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LiveOne, Inc. misses on earnings expectations. Reported EPS is $-0.02 EPS, expectations were $-0.018.

Operator: Hello, and welcome to the LiveOne Incorporated Q1 Fiscal 2025 Financial Results and Business Update Webcast. My name is Elliott and I’ll be coordinating your call today. [Operator Instructions]. I would now like to hand over to Aaron Sullivan, CFO. Please go ahead.

Aaron Sullivan: Thank you. Good morning and welcome to LiveOne’s business update and financial results conference call for the company’s first quarter ended June 30, 2024. Presenting on today’s call with me is Rob Ellin, CEO and Chairman of LiveOne. I would like to remind you that some of the statements made on today’s call are forward-looking and are based on current expectations, forecasts and assumptions that involve various risks and uncertainties. These statements include, but are not limited to, statements regarding the future performance of the company, including expected future financial results and expected future growth in the business. Actual results may differ materially from those discussed on this call for a variety of reasons.

Please refer to the company’s filing with the SEC for information about factors, which could cause the company’s actual results to differ materially from these forward-looking statements including those described in its Annual Report on Form 10-K for the year ended March 31, 2024, and subsequent SEC filings. You will find reconciliations of non-GAAP financial measures to the most comparable GAAP financial measures discussed today in the company’s earnings release, which is posted on its Investor Relations website. The company encourages you to periodically visit Investor Relations website for important content. The following discussion, including responses to your questions, contains time-sensitive information and reflects management’s view as of the date of this call, August 13, 2024.

And as except required by law, the company does not undertake any obligation to update or revise this information after the date of the call. I’d like to highlight to investors that the call is being recorded. The company is making it available to investors and the media via webcast, and a replay will be available on its website in the Investor Relations section shortly following the conclusion of the call. Additionally, it is the property of the company and any redistribution, transmission or rebroadcast of this call or webcast in any form without the company’s express, written consent is strictly prohibited. Now, I would like to turn the call over to LiveOne’s CEO, Rob Ellin.

Rob Ellin: Thank you, Aaron, and good morning, everyone, and thank you for joining us today. I’m thrilled to share the outstanding progress and success that LiveOne has achieved driven by our unwavering commitment to a creator first model. Our Audio Division comprising of Slacker Radio and PodcastOne, we reached incredible milestones in Q1 of fiscal 2025. We achieved a record breaking $31.9 million in revenues and $5.1 million in adjusted EBITDA, demonstrating the strength of our business strategy and execution. Looking ahead, we project a phenomenal year 2025 for Audio Division, which anticipated revenue of $130 million to $140 million and adjusted EBITDA ranging from $20 million to $25 million. Our solid foundation and exciting opportunity position us for continued growth.

Under Brad Konkol’s leadership, Slacker Radio’s experience remarkable growth starting with our great partnership with Tesla, remain and continue to grow that partnership. We added Bill Wittress six — almost seven months ago formerly headed up a division of Microsoft doing over hundreds of millions of dollars of B2B deals. He has crafted a strategic roadmap for B2B partnerships, securing and signing four major additional deals with 63 potential partnerships in the pipeline. We anticipating closing multiple partnerships with market cap companies ranging from $1 billion to $1 trillion before this year ends. Based on a huge success signing five major additional partnerships including the $24 million partnership with one of the largest streaming networks, a Fortune 250 company, which is adding about $2 million of revenues a month, we’ve expanded our B2B team from one to six professionals.

And now, aggressively moving to hire ahead of each vertical, we fully expect to have a team of over 10 people leading the charge in our B2B area. Our membership growth continues to grow steadily increasing from $3.7 million to $3.9 million. We maintain cost efficient marketing spending less than $1 million this year with very little breakage, the lowest by far in the industry. PodcastOne led by Kit Gray is seeing tremendous success signing 37 new podcasts added in the last 12 months, bringing our total to 187 podcasts. We’ve sold a second major show to a streaming partner that is moving our podcast from podcasting to television and film. There’s a unique amount of money that will be coming in from those television shows, shows over the next couple of years.

Our publishing business led by Josh Hallbauer grew 300% and earned two Grammys. We partnered with Kartoon Studios to produce and publish and distribute original programs for Winnie-the-Pooh, the mega brand funded by — funded with over $30 million. Our celebrity brands division led by Sara Dee is set to introduce 10 to 12 celebrity brands over the next 12 months, including Birthday Sex Chardonnay with Jeremih, Smyle Coffee with KYLE. We’re expanding our stock buyback again to $12 million. We’ve purchased over 4.4 million shares of stock and extinguished those, leaving us with additional $6.3 million dedicated to the program. This move underscores our confidence in the company’s future and a commitment to enhancing shareholder value. In conclusion, we believe our stock remains extremely undervalued given our impressive growth and unlimited future prospects.

We’re confident in our direction and excited about what lies ahead. Thank you everyone for your support and belief in LiveOne. I’m now going to hand it over to Aaron Sullivan to review the Q1 results.

Aaron Sullivan: Thanks, Rob. I’ll spend just a minute providing a very brief overview of our results for the first quarter of fiscal 2025 ended June 30. Consolidated revenue for the three-month period ended June 30, 2024, was $33.1 million. Slacker posted record revenue for Q1 of $18.7 million and adjusted EBITDA of $5.4 million. PodcastOne posted record revenue of $13.2 million and — with an adjusted EBITDA loss of $300,000. For the first quarter of fiscal 2025, revenue consists of 56% membership and 44% advertising, sponsorship, merchandising and other, compared to 64% membership and 46% advertising, sponsorship and merchandise in the prior year period. Consolidated adjusted EBITDA for Q1 fiscal 2024 was $2.9 million. On a U.S. GAAP basis, LiveOne posted a consolidated net loss of $1.7 million or $0.02 a share, diluted share in Q1 fiscal 2025.

As of June 30, 2024, total members, which include free members were approximately 3.9 million. Note that included in total members are certain members who are currently subject to a contractual dispute for which we are not currently recognizing revenue. Rob, I’ll turn it back to you.

Rob Ellin: Great. Great, Aaron, and thank you for the great job you’ve done. Just to wrap it up, real focus right now is on those B2B partnerships, that first, $24 million deal, the revenues are just kicking in. We’re seeing the growth in our revenues. We’re seeing our growth in our EBITDA, and we’re seeing the opportunity that these B2B deals that we could go on a hot streak here. And as we do, these are major companies. These are billion to trillion dollar companies, major verticals across auto obviously with Tesla expanding into other auto companies, carriers, carriers around the world, merchandise businesses, retailers, hotels, airlines, there’s so many opportunities right now and the team has really put together a fabulous lineup.

And that’s why we’re going to expand the team, we’re going to grow the team for the first time in almost four years, and we’re going to focus all that energy on those big $20 million plus partnerships with major partners across those verticals. So I want to thank everyone for joining and open it up for any questions.

Operator: Thank you. [Operator Instructions]. Our first question comes from Brian Kinstlinger with AGP. Your line is open. Please go ahead.

Brian Kinstlinger: Great. Thanks for taking my questions. It’s great to see the solid sequential growth in podcast revenue. And you mentioned that the B2B partnership kicking in and beginning to have a material impact, sounds like about $2 million a quarter, I think you said. I’m curious, how much more does that partnership have to go in terms of reaching the peak run rate?

Rob Ellin: Yes. So we’re not giving the exact numbers, Brian on it, but this is — it started in November and scales up. So I think you’ll see that revenue growth in each quarter going forward and yes, we couldn’t be more excited about the partnership and the opportunity to get much bigger. This is the beginning of putting our content across large streaming platforms. And I think it’s so critical that the cost of content has become so expensive that it’s almost $1 million and $1.6 million an hour of content. And the beauty of our content is we have AAA content with the biggest social media stars in the world. Right, it costs us under $3,000 an hour. So we have the opportunity to really grow that. And I see this is the first of many streaming partners and streaming networks.

When you think about music choice on cable or satellite and how many channels were audio, let alone video and you think about MTV and country music channels and all, there really is no thought leader in music anymore. And we have an opportunity to really be that thought leader across audio and video.

Brian Kinstlinger: Great. And then as it relates, I think so, correct me if I’m wrong, the $24 million B2B partnership you just mentioned, and it was on podcast press release, that’s the one that was pending on the last call. That’s in addition to the other one that’s ramping. Is that right? And if that is right, can you comment on details such as, is that $24 million over some period of time, and how long do you think before that begins to ramp?

Rob Ellin: Yes. Let’s be a little bit careful now. We’re going to have a lot more details shortly on the next partnership, and we’ll provide that publicly in the very near future. And I think it won’t just be one, as we stated earlier, we’ve now signed four additional major partnerships, and we’ll have some real clarity on that coming over the next couple of weeks.

Brian Kinstlinger: But just to be clear that this $24 million partnership, because it just happens to be the same number, I want to be clear, that’s different than the $27 million from November, right?

Rob Ellin: No, no, that’s the same one, that started in November and is growing and is scaling up.

Brian Kinstlinger: Okay. And then can you speak maybe to the inventory fill rates of podcasts, I guess, the heart of the question is on today’s viewership or listener — sorry, on podcast, where could — how much better could the inventory fill rates become as you win lots of these partnerships?

Rob Ellin: Aaron, you want to take that?

Aaron Sullivan: Yes. I think we’re seeing consistency in our kind of fill rates in terms of what we’re able to sell through to partners. So we will try to optimize that. The quicker way to revenue though is just to increase the available inventory, right, and that’s kind of what we’re working towards. And yes, I think I’ll leave with that. Rob, if you have anything to add?

Rob Ellin: Yes. I’m not sure I followed the exact question. I think what you’re articulating with these additional B2B deals is not just inventory. This is traffic and audience, right? As we spread our tentacles [ph] spread it off across a Fortune 250 company, right, with a massive streaming network, we’re getting more eyeballs onto ours, the more traffic, the more audience, the more advertising we’re going to get. And I think that answers it, Brian. But I’m not sure I understood fully your question.

Brian Kinstlinger: Yes. No, no, yes, we’ll take it offline. Perfect. My last question is how aggressive are you advertising to increase your market share or growth in downloads and unique listeners?

Rob Ellin: How aggressive — say that one more time.

Brian Kinstlinger: I guess, I’m just curious, is the budget increasing, I mean, what — how are you acquiring new listeners?

Rob Ellin: Yes. The budget is now yields the beauty of this, of course, Spotify app [Technical Difficulty] continue and multiple — TikTok multiple times and yes, those opportunities to keep getting our content into new places where already the distribution and the traffic is built is really the key. And part of the beauty is, because we own our own technology, right, all those revenues come for us, right? The more traffic, the more audience, the more revenues we derive.

Operator: We now turn to Barry Sine with Hills Research. Your line is open. Please go ahead.

Barry Sine: Good morning, gentlemen. How are you? Can you hear?

Rob Ellin: Excellent, Barry. Good to hear your voice.

Barry Sine: Okay. Okay. Likewise. On the $63 million pipeline, I wonder if we can get a little more breakdown on that. Rob, you mentioned a number of different verticals. You’re hiring senior managers for each of the verticals. How does that pipeline breakdown by vertical? And within that pipeline, how many of those have you tendered a contract to, say you’re far along in the process. Could you give us a little more visibility on that pipeline?

Rob Ellin: Yes. I think, I don’t know if I can get much deeper than that from a legal standpoint, but I can tell you this is a) we absolutely will have additional auto companies this year, right. Number two is, because our balance sheet and all the debt was converted at $2.10, right. Our balance sheet is pretty pristine now and very shaped. It gives us the opportunity to expand globally, right. So we have opportunities with carriers around the globe. I love the opportunity. Love, love, love, and couldn’t be more excited about where we’re going with retail, right. The opportunity that you’re watching Amazon, right, and Amazon has so much rich media. Everyone from Best Buy to Walmart to Costco all came, all the retailers must have, right, that are competing in the digital world, right, must have content.

And you’re seeing that happen and starting to see some of my thoughts come to fruition as you saw Walmart buy Vizio for $2.3 billion. It only sold for $230 million only three years ago, right, when Charlie Collier bought it. Now they’re paying $2.3 billion for it. That’s the first telltale sign they’re going to compete head on with Amazon and they’re going to create their own content like Amazon Prime. And I see the same thing across all the retailers is really exciting. In terms of hotels and airlines and loyalty programs, really just massive opportunity for our company. We’re one of 10 DSPs in the world. We’re the third fastest growing. We’ve got this very unique content and proving more and more original content like the event we’re doing tonight, right?

You’re going to have more and more original content from music, right, to podcasting to podcasts turning to television shows that I think that more and more networks are going to need our content. And so I’m really excited about where that’s going. And that 63 deals, we’re — there’s way more than that in the sort of pipeline. These are the ones that we think have really moved along that are in shape, that have an opportunity to close in the next 12 months.

Barry Sine: And then continuing on that, I believe you’ve said that there are four deals that are actually signed. You can’t discuss who they are, but as they go live, we’ll see press releases with announcements on those. Any update on that process?

Rob Ellin: Oh, yes, it’s coming. So again, those are all we said before year-end is coming. So the year is coming fast, right? And so you’re going to see announcements on each one of those shortly. And with those, you’ll see some details and highlights where they’re going. And when you’re talking about billion to trillion, multi-trillion dollar partners, right. You got to be careful what they’re going to let you say and how much the detail they’re going to give in it, right? But for us, as you can imagine, these are very meaningful, right? Every $20 million deal, if four more deals hit, right, and we had those four deals, even if they’re half the size of last one, that’s going to put us in the $200 million range next year. What I’ve told the Street is, our goal is to get 10 million subscribers. And 10 million subscribers, we’ll be doing $0.5 billion in revenues and $150 million in EBITDA. And that’s the goal of the next couple of years.

Barry Sine: And then I want to pick up on the word you’ve used a couple times in the call, which is globally. In your script, you talk about serving carriers globally. And then a minute ago, in response to my question, you cited the balance sheet cleanup that’ll allow you to go global. So that’s been a long-term aspiration of the company to get global streaming rights. And one of the things I believe that kicks in almost automatically is Tesla automatically. So is that what you’re alluding to? Is that you’re closer to getting music streaming rights on a global or at least European basis. And what would the implications of that be?

Rob Ellin: I’m hoping you’ll see very shortly. And this is — we’ve gone through some tough times here. We had to survive COVID. We lost our entire live business. We were inches away from having all those licenses and moving overseas then, but it was unaffordable, right, post-COVID, we lost 30% of our revenues and a big part of the growth story of the company, we had to pivot it, right, and turn it. We — this team has just done a magical job of fighting through adversity and difficult times. And we’ve proven we’re going to survive it. But not only going to survive, we’re going to expand around the globe. And for anyone that knows me, my last two companies, including Digital Turbine was built off the backs of carriers, right, overseas, right, we have tremendous relationships over there.

So it’s definitely in the forefront of positioning where the company is going. And absolutely, if you look at all the memberships, whether it’s Netflix or it’s Spotify, half their revenues come U.S. and have come overseas, right? We have 25%, 28% of our traffic is overseas. We’re not deriving any revenues from it. But it had to be affordable. It had to make sense and now it’s the time where we’re ready and way better positioned to be able to do that. And I think you’ll start to see long-term deals with our partners, right, our existing partners, not only those 63 right there in the pipeline, but also our existing partners start to see for the first time, long-term partnerships and expansion of where we can — where our content can live.

Barry Sine: Okay. That’s great. And then my last question, you just alluded to my last question; you started to mention live events. And I know in the early history of the company pre-COVID that was the main event, live events. I saw and I thought it was interesting that you put a press release that you’re doing a live event in the Hamptons. And previously, what you’ve said is that you would not do live events unless they were profitable and you would need to get a sponsor to do that. So are we — is the company dipping its toes back in the water on live events? And does that mean you found a way to do this more profitably?

Rob Ellin: Yes, absolutely. And the event that we’re doing tonight, we have great sponsors from E11EVEN Vodka on, right? We’re positioning ourselves again that we’ve proven right, and Josh Hallbauer runs our music has proven, yes, we had Teddy Swims play at our studio in Beverly Hills, right? And next, after seeing him on streaming platform, guy becomes one of the biggest stars in the world, right? We had Kid Laroi before anyone heard of him. So we’re going back to our thesis that as a thought leader in music, it is critical to be a thought leader, and not just audio, but video. And now that we have the resources, right, and we obviously have the relationships with the talent as well, the industry, this is the time to really step on the gas.

And you’re going to watch something pretty spectacular tonight. You’re going to see 12 artists perform of all genre of music. You’re going to see one of the greatest pianists, classical pianists play all the way up to the main squeeze. And in between, you’re going to see some of the great R&B and Hip-Hop artists performing. So it’s going to be a really special night. And our talent is getting closer to our company. As you can see by these celebrity deals, right, these celebrity partnerships, we don’t only want to be able to derive revenues just by putting music up. We’re starting to own products in conjunction with that talent. And I’m really proud of the team and what they’ve done. Sara who’s joined us is Head of our Celebrity Brands, brings a unique talent to the company, unique skill driving massive revenues.

She was at White Claw when they were doing $600,000 revenues. I think she left when they were doing about $4 billion. We see a huge opportunity to be able to drive more and more revenues, offer those relationships with podcasters, as well as with social media stars, including artists.

Barry Sine: Okay. That’s my questions. Congratulations on a great quarter, guys.

Rob Ellin: Thanks, Barry, and thanks for your support.

Operator: We now turn to Sean McGowan with ROTH Capital Partners. Your line is open. Please go ahead.

Sean McGowan: Thank you. I apologize if these questions have been asked already. I get dropped from the call a couple of times. First, Aaron, on cost of sales seems to be a little higher than we had expected, particularly at PodcastOne. Can you talk about what’s driving that?

Aaron Sullivan: Yes. Hi Sean, how are you? Yes. So our content acquisition costs have been a little bit higher than we anticipated. That’s kind of the upfront cost to signing some of these deals and new podcasts. Going forward, we expect it to level out over the next couple of quarters about where we’re at today and then start to improve from there.

Sean McGowan: And tying that question for Rob then, is this surprising to you? I thought we were in an environment where it was actually going to be easier to pick up shows that we’re either getting dropped or not getting renewed on the same terms from other networks. Is that proving not to be the case or less of the case than you had expected?

Rob Ellin: No. No, it’s actually really exciting. I mean, we’re just starting so many podcasts. We’re announcing one almost every week. And there’s a cost to it, right? The way that it works, Sean, in podcasting, you and I have talked about this a little bit is, you sign the podcast, right? You pay them some money, right, they — even if they start doing the podcast the next morning, you’re paying them for the next three months, and you’re not collecting back your money for three months to four months. So there’s a window of time. So I would say, Aaron, hit it right in the nose. But it’s really exciting how many podcasts were signing, and they’re adding about $350,000 to $500,000 on average per revenue. Every single one of these podcasts is a joint.

So there’s going to be a little cost to it in the beginning, but can’t really be — can’t be better than growing the revenues right now and doing that. And we’ll achieve, we’ll get that in the back end. We’ll get those back in the back end when we start to get paid by the advertisers.

Sean McGowan: So it’s not so much that you have to pay more per podcast to get them, it’s just that you’re signing more than you had expected to, so that’s why the cost is higher.

Rob Ellin: Yes. Yes. This has been really exciting. There’s been some really exciting signings as well, that there’s a little bit of money, it’s got to go out the door day one.

Sean McGowan: Okay. Got it. And then in terms of, you talked a lot about these deals that you’re in process with and signing and lining up more partners. So is your strategy then to only update or improve or increase the revenue guidance once the deals are signed? Because I would have thought that if you’re signing new deals and you close on some others, maybe you’d increase the revenue guidance. Is it you’re just going to wait until they’re nailed down?

Rob Ellin: Well, I think the guidance is a good number right now. And we’re going to — as we announce the next B2B deals, right again the more — the bigger our distribution is, the bigger our audience is, right, the more revenues we’re going to drive. So I’d be surprised if we don’t raise those guidance again at the end of next quarter. But let’s look carefully. This is great growth, spectacular growth for PodcastOne. And let’s look at that number again at the end of this quarter and really make sure that we’re going to beat the number, right? This is a tough market out there, as you know. We want to make sure we beat the numbers.

Sean McGowan: Great. Thank you very much. Appreciate it.

Operator: We now turn to John Liviakis with Liviakis Financial. Your line is open. Please go ahead.

John Liviakis: Hey guys, congratulations on a strong quarter, and sorry for the technical problems on the conference call with Sean. There were some issues. But anyway, excellent presentation. Quick question for you. So at one time, the company disclosed its relationship with J.P. Morgan and represent them in strategic dialogue. Any comments you want to make and what your plans are there and how it’s progressing?

Rob Ellin: I mean, we’ve always been an acquisition vehicle and we’ve been hampered over the last couple of years from doing that, all the different difficulties that have been out there. This is certainly a time that both offensive and defensively. We are continue to aggressively explore and are extremely excited about the opportunities that are out there, right. And as we keep moving up the ladder, we’re number 11 in the world in podcasting. We’re number 10 in audio, right. We’re certainly a candidate that could come aggressively try to bias, but we’re also looking at some great assets that meteor assets have been decimated and probably even more on the public side than the private. There’s some great assets out there that we will aggressively look at.

If we could find another Slacker, we can find another PodcastOne, but both of those companies doing $20 million in revenues, right. Slacker is now at a run rate to do $85 million, right. We bought PodcastOne doing $20 million; it’s now on a run rate to do over $50 million. If we can find another great asset that is accretive to us and fits in with the team and the skills that we have, we are absolutely aggressively looking on both sides, both offensive, defensively, and the entire J.P. Morgan team is coming in for the event tonight. So we’re deep in the trenches with them on a regular basis on all the excitement and energy around both sides, both offensively and defensively.

John Liviakis: Sounds great. The Slacker acquisition looks to be brilliant. And what a job that Brad’s been doing. And any quick comment on that? You mentioned 63 B2B contracts in a pipeline, but actually now you’re saying that that’s really the core opportunities and there’s vastly more than that in a pipeline, that’s an interesting comment. And what’s the intellectual property there? How many patents do you have and how that differentiates from the rest seem to be really taking off that business, its unique model, et cetera.

Rob Ellin: Yes. Well, we have over 40 patents. I think from a patent standpoint, we’re one of the thought leaders in the space. I think from a — from the standpoint of our IP, this is the first time we’re starting to showcase how valuable our IP could be. And just think about taking a podcast, right, and I said Varnamtown would be a bidding war, right? We just sold the rights to it and we’ll talk about who the partner is very shortly, right? And in taking a podcast that cost us almost no money, right? Literally limited money and now selling it to television, they’re very serious money. My background previously and my team’s background, we’ve made a lot of movies, we’ve made a lot of television shows. The cost is zero to us going forward.

So when you own that IP, you get a second window of money that could be staggering, right? And I said we were going to sell one a year for the next couple of years. Now we’ve sold two this year. If we could sell two a year, could be tens of millions of dollars in profits, let alone revenues, but profits that come to the company over the next few years with no additional cost to us. And just to give you an idea on both Vigilante and Varnamtown, their streaming partners are going to be in by the time we turn the corner. Vigilante, they’ve already spent well over $1 million on Varnamtown will be well over $1 million shortly that studios are spending money on. And because we have a proven, not only do we have proven IP, but on top of having the IP, we have proof that there’s an audience.

When we go into those negotiations, we go with a very different bullet than you go in. When you just go in and you got a book or a script or great story, I see really, really super opportunities and excitement around that. For anyone that doesn’t know, I owned atmosphere films previously and was fortunate enough to have the movie 300 and Spiderwick Chronicles. And when the studios are paying for these things, you never know how they can go. And 300 ended up doing it, $1.1 billion in revenues. So we’re really energized about owning our own IP and it’s kind of this team skill is owning our own IP.

John Liviakis: Great. Thank you, Rob.

Operator: We now turn to Sachem Ismalois [ph] with — sorry, a Private Investor. Your line is open. Please go ahead. Sachem, your line is open.

Unidentified Analyst: Sorry, I was muted. Thank you for your presentation and congratulations on your remarkable results. And most of my questions have already been answered, but I still have some questions. And first of all is, I noticed that your general and administrative costs quite increased. And could you explain it? How could you expose this?

Rob Ellin: Aaron, you want to take it? I’m having a little trouble hearing.

Aaron Sullivan: I’ll take that one. Yes, I think the question was, are G&A expenses have increased? So yes, two drivers to that.

Unidentified Analyst: Yes, that’s right.

Aaron Sullivan: One is additional stock-based compensation. We’ve had some executive contracts that have some stock-based comp in them, and that’s kind of across the business units. And then specifically as it relates to PodcastOne and this is kind of included in consolidated results as well. And there’s additional G&A, just as it’s a separate public entity. So you’ve got additional legal accounting and just general public company expenses. That’s really what’s driving the increase in G&A.

Unidentified Analyst: So there’s no extraordinary costs included there.

Aaron Sullivan: Sorry. I didn’t quite catch that. Can you repeat that?

Unidentified Analyst: All some extraordinary costs were included in G&A costs?

Aaron Sullivan: I think that was —

Rob Ellin: Yes, I think if we get hear you, it’s really — yes, I think it’s really hard to hear you, but I think just to answer you, Aaron and our finance team have done a brilliant job in that we’re filing two audited financials, right? There’s additional costs there, both legal and accounting for both the public companies LiveOne and PodcastOne. And then we also explored the opportunity of doing a stack with Slacker Radio, right? And so there was also additional costs of doing the audits on Slacker. So — and stay tuned on that. There’ll be some excitement and energy around that as well. But there is additional both legal and accounting costs to this.

Unidentified Analyst: Okay. Thank you. And one more question, is that revenue from Audio Division may be to some extent explained by seasonal factor. Is there any seasonal pressure in your Audio Division revenue?

Rob Ellin: Can you try that one more time? And I really apologize.

Aaron Sullivan: I think the question is there seasonal pressure across the business units? I think that’s the question.

Unidentified Analyst: Seasonal factors?

Aaron Sullivan: And seasonal factors —

Rob Ellin: Yes, we have some — go ahead, Aaron.

Aaron Sullivan: Go ahead, Rob. All right, so I’ll take it. So in our merchandise business and in podcast, our Q3, which is — fiscal Q3 or calendar Q4, that’s our largest quarter. But other than that, our subscription business, no seasonality there, and that kind of even things out a little bit.

Unidentified Analyst: Okay. Thank you.

Operator: [Operator Instructions]. We have no further questions. I’ll now hand back to Robert Ellin for any final remarks.

Rob Ellin: Yes. I think we covered a lot today. I think we covered a lot in the earnings and how spectacular the numbers were. I want to thank everyone for joining and thank everyone for the support. And we look forward to updating everyone very shortly on some major B2B partnerships. And those four that we have already signed will be announced shortly, and there’ll be more to come. So thank you, everyone, and appreciate it, and we look forward to the next call.

Operator: Ladies and gentlemen, today’s call has now concluded. We’d like to thank for your participation. You may now disconnect your lines.