Good morning. [Foreign Language] Thank you for joining us for Stingray's conference call for its first quarter results ended June 30, 2023.

Today, Eric Boyko, President and CEO as well as Co-Founder; and JP Trahan, CFO, will be presenting Stingray's financial and operational highlights. Our press release reporting Stingray's first quarter results for fiscal 2024 was issued yesterday after the market closed.

Our press release, MD&A and financial statements for the quarter are available on our investor website at stingray.com and also on SEDAR. I will now give you the customary caution that today's discussion of the corporation's performance and its future prospects may include forward-looking statements.

The corporation's future operation and performance are subject to risks and uncertainties, and actual results may differ materially. These risks and uncertainties include, but are not limited to, the risk factors identified in Stingray's annual information form dated June 6, 2023, which is available on SEDAR.

The corporation specifically disclaims any intention or obligation to update these forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable law. Accordingly, you're advised not to place undue reliance on such forward-looking statements.

Also, please be reminded that some of the financial measures discussed over the course of this conference call are non-IFRS. Please refer to Stingray's MD&A for complete definition and reconciliation of such measures to IFRS financial measures.

Finally, let me remind you that all amounts on this call are expressed in Canadian dollars unless otherwise indicated. With that, let me turn the call over to Eric.

Okay, Mathieu. Good morning, everyone, and welcome to our first quarter conference call for fiscal 2024.

Stingray delivered robust adjusted EBITDA of $28.3 million, representing 35.8% of sales in the first quarter of '24, thanks to cost-saving initiatives implemented over the past year. Despite a temporary slowdown in revenue growth due to the timing of retail media advertising campaigns, I'm pleased to report current revenues for Stingray Advertising in the second quarter are plus 45% year-over-year at this point.

We remain on target to achieve our goal of 40% growth in the advertising revenues for 2024. We also recently announced a sales agreement with Mood Media's Vibenomics advertising division, a leading technology and retail media solution provider that creates the largest retail media audio network in the U.S.

This groundbreaking collaboration will provide advertisers south of the border with an unmatched national presence, reaching over 800 million monthly shoppers through in-store digital audio advertising across 25,000 brick-and-mortar locations. This broad network will encompass major players in key retail verticals, including grocery, drug, convenience and home improvements.

Expansion to other verticals will continue in 2024. This announcement comes from a period of significant growth for the retail media advertising in the U.S.

with a spending forecast to increase from $31 billion in 2021 to an anticipated $61 billion by 2024 as per the eMarketer retail media ad spending forecast report. In addition, we secured a deal last week with Loblaw Media, the retail media division of Loblaw Companies, to expand Stingray's retail audio advertising network into Loblaw stores across Canada.

The Loblaw network will span nearly 300 locations, including Loblaws, Zehrs, Real Canadian Superstore and other retail banners, with campaigns expected to begin as soon as mid-August. As a result, we expect more than to double our revenues from the Stingray Advertising business to $100 million from the $50 million right now in the next 24 months.

The goal is to offer a single large-scale network of premier retailers for advertisers seeking reach to promote their brands. We also anticipate accelerated momentum for our in-car entertainment segment in fiscal '24 driven by the recent partnership with BYD, the world's leading manufacturer of new energy vehicles, to bring our popular Stingray Karaoke product to its fleet of nearly 300,000 cars at launch in Europe and Lat Am.

As well, Audi cars are beginning to roll out manufacturing plants with our embedded Karaoke app while we keep expanding our presence at Tesla. In terms of FAST channels, they generate solid organic growth in the first quarter as we begin better monetizing our content for connected TV by contracting third parties to resell unsold inventories by major television manufacturers.

As planned, revenues from our SVOD business were slightly down, [ singly ] given our sharpening focus on B2B-driven customers, but profitability improved year-over-year. We expect new country launches in Europe, in Lat Am, Asia and Middle East launched in Q2 and Q3, which will have positive impact on our overall subbase, plus the addition of Zen Life SVOD, which also will be a great new product that we're adding with our friends from Amazon.

Altogether, revenues from Broadcasting and Commercial Music business increased 2.3% to $47.2 million in the first quarter of '24, while Radio revenues declined by 0.6%, or we call it pretty much flat, to $31.8 million as we will, and we still, outperform the industry. Looking ahead, we intend to be laser-focused on our 4 high-growth opportunities that I outlined earlier, but we will remain disciplined with our spending due to the uncertain economic environment.

Our capital allocation strategy will continue prioritize debt reduction without sacrificing key growth initiatives fiscal -- in 2024. So again, very happy with our first quarter, a good start to the year.

And with this, I will now turn over the call to our friend, Jean-Pierre.

[Foreign Language] Revenues reached $79 million in the first quarter of fiscal '24, up 1.1% from $78.1 million in Q1 2023. The increase was primarily due to the equipment and installation sales related to digital signage and an increase of in-car revenues and to a positive foreign exchange impact, largely offset by a decrease in B2C and in retail media advertising revenues.

Revenues in Canada improved 1.3% to $47.3 million in the first quarter of 2024. The growth mainly reflects enhanced equipment and installation sales related to digital signage.

Revenues in the United States remained stable year-over-year at $19.1 million in Q1 '24 as in-car and FAST channel revenues increased and to positive foreign exchange impact, largely offset by a decrease in B2C and in retail media advertising revenues. Finally, revenues in other countries rose 2.1% year-over-year to $12.6 million in the most recent quarter.

The increase can primarily be attributed to a positive foreign exchange impact offset, in part, by lower audio channel and subscription revenues. Looking at our performance by business segment.

Broadcasting and Commercial Music revenues grew 2.3% to $47.2 million in the first quarter of 2024. The growth was primarily due to equipment and installation sales related to digital signage, in-car and FAST channel revenues increase and to a positive foreign exchange impact, largely offset by a decrease in B2C and in retail media advertising revenues.

Radio revenues, meanwhile, declined 0.6% or flat year-over-year to $31.8 million in Q1 2024. The slight decrease can be attributed to reduction in national advertising revenues.

But as Eric mentioned, our Radio business outperformed the industry. In terms of profitability, consolidated adjusted EBITDA improved 8.4% to $28.3 million in the first quarter of 2024 from $26.1 million in Q1 2023.

Adjusted EBITDA margin reached 35.8% in Q1 2024 compared to 33.4% in the same period in '23. The growth in adjusted EBITDA was mainly due to higher revenues year-over-year, while the increase in adjusted EBITDA margin can be attributed to lower operating costs in the Broadcasting and Commercial Music segment following cost-saving initiatives implemented in fiscal 2023.

By business segment, Broadcasting and Commercial Music adjusted EBITDA increased 19% to $20 million in the first quarter of 2024. The year-over-year increase was mainly due to cost-saving initiatives implemented during the past year and an improved gross margin on higher revenues.

Adjusted EBITDA for our Radio segment declined 6.8% year-over-year to $9.9 million in the first quarter of 2024. The decrease can be attributed to a slight drop in revenues, increased music rights fees and higher marketing expenses.

In terms of corporate adjusted EBITDA, which represent at-office operating expenses less share-based compensation as well as performance and deferred share unit expenses, amounted to a negative $1.6 million in the first quarter of 2024. Stingray reported a net income of $14.1 million or $0.20 per diluted share in the first quarter of 2024 compared to $9.4 million or $0.13 per diluted share in Q1 2023.

The increase was mainly due to a onetime settlement gain from a trademark dispute and higher gain on the fair value of derivative financial instruments. These factors were partially offset by higher interest expense.

Adjusted net income totaled $11.9 million or $0.17 per diluted share in Q1 2024 compared to $13.2 million or $0.19 per diluted share in the same period in 2023. The decrease can mainly be attributed to a higher interest expense, partially offset by better operating results.

Turning to liquidity and capital resources. Cash flow generated from operating activities totaled $24.3 million in the first quarter of 2024 compared to $16.3 million in Q1 2023, with a onetime settlement gain from trademark dispute and better operating results accounting for year-over-year improvement.

Adjusted free cash flow amounted to $18.5 million in Q1 2024 compared to $15.7 million in the same period in 2023. The increase was mainly related to better operating results and lower tax paid, partially offset by higher interest expense.

From a balance sheet standpoint, Stingray had cash and cash equivalents of $11.7 million at the end of the first quarter; subordinated debt of $25.6 million; and credit facilities of $374.1 million, of which approximately $53.7 million was available. Total net debt at the quarter end stood at $388 million or 3.28x [ pro forma ] adjusted EBITDA.

Net debt increased [indiscernible] from $371.1 million in Q4 2023 mainly due to an earn-out paid on the in-store audio network acquisition and higher interest expense. This ends my presentation for today.

I will now turn the call back to Eric.

Okay. Thank you, JP, for your report.

And I guess we're ready for questions from our friends.

I wanted to first ask a question on the Radio side. It feels like the cost inflation in this segment was somewhat uncontrollable.

Are there ways for you to cut OpEx there to protect the margins if revenue kind of remains flattish for the year?

Yes. The OpEx here increasing is -- part of it is because of the NAFTA agreement.

So our Re:Sound fees for all radio stations have increased for us like $1.2 million. That was part of the new agreement with NAFTA that was negotiated.

So there's a $300,000 a month coming from that. We did do more marketing this quarter than last year, about $400,000.

But besides that, our costs remain the same. And yes, [indiscernible] risk of recession.

But in our case, with the fact that some of our competitors are shutting down station or putting less focus on radio or some of our competitors also might be thinking of divesting, it's giving us a great opportunity to win market share with the local sales force. And I must say, we're really gaining momentum on the local side while some of our peers are decreasing their investment in the local teams.

So we remain positive. Radio, again, Q2, very stable.

But again, part of the OpEx was marketing, and the other one is really it's going to be there forever, it's Re:Sound. But the good news, we also got a saving potentially for [ C11 for Part 1 ].

So that might offset the Re:Sound costs as we don't need to [indiscernible], so that's the good news.

So are you expecting to see some revenue growth on the Radio side for 2024?

Yes, right now we're expecting -- we're happy. Right now in Q2, at this point, we're positive, slightly positive.

But for sure, when we looked at numbers of our peers on both TV and radio, we're very happy with our results. So very stable business, very happy for the moment.

But radio -- and again, for us, our big win is when our cars -- the national market is coming back slowly, but we're not seeing the car business we used to have, which was $30 million pre-pandemic and last year was $10 million. So the $20 million we're missing, it's all the car business.

So we need more cars inventory. And hopefully, when you hear more car ads on the radio, we're happy.

Good. And then maybe just one on Mood Media.

My understanding was that you guys had a very nice technological advantage [ with Mood ]. So maybe you can just kind of delve into what each partners bring to that relationship?

It's really, roughly, we have our inventory at a certain CPM [indiscernible] $500 million. They also have $500 million of inventory with their retailers.

And we only sell [ 1 million ]. So how do we go from 5% selling of our inventory and at least getting to 20%, which would be $200 million?

So the goal was really [ to say how can ] working together. So we're doubling our retailers.

We're really having a national footprint. And both sales force can sell in each other's territory, so we're doubling the sales force.

So that's why we feel very confident that we'll be able to double ourselves in the next 24 months, and we expect results as early as in the next month. Both our sales force are selling -- we're selling on Kroger.

They're selling on Albertsons and [ CVS ]. And I think you'll see quickly that a lot of retailers will be joining this network.

We call it a network, as I think it's important. We don't sell a retailer.

We sell a network. And I think this deal is very creative.

And I must say, thank you to our Mood partners for taking and working together on this project. But it really makes us the #1 player in the world by far in terms of number of retailers.

And I think you'll see a lot of new retailers being signed and added, and we'll become an incumbent in the phase. So very excited about that deal.

And we will have some numbers this year. We just have to monetize, but there will be some financial impact that we'll be happy to tell the analysts in the next quarter.

Just first question on what happened exactly in retail media this quarter. Was it a function of the broader advertising market creating some pullback in some campaigns by clients?

Or was it more you guys and/or you guys sort of slowing things down in anticipation of doing the Mood Media deal?

No, no. It was really -- it was one campaign by [ a pharma ] of $2 million that was in Q1 last year.

And so the campaign this year was pushed to June, July, August, in Q2. So it's a $2 million campaign.

So you do the numbers. We would have been up 20%, 30% in Q1.

In Q2 now, we're looking already plus 45%. We'll probably finish at plus 60%, plus 70%.

So when you average out over the first 6 months, we're going to be at the plus 30%, plus 40% range. It's really just the timing of one campaign.

So overall, for the year, our pacing is we're still pacing at plus 30%, 35% in the U.S., which is our goal. In Canada, our pacing is at a 100%.

So we're still in a good position for increasing that unit by 40% to $55 million. So again, it's really a timing issue with one campaign.

But the more we grow and the bigger we get, the less we'll have this data risk of one campaign making a difference.

Right. But having said that, some of these metrics that you just gave, the 30%, 35% U.S., 100% Canada, you also suggested those were the growth metrics prior to the Mood Media deal.

So can you just -- I understand the doubling of the sales force, the doubling of the footprint, the enhancement of a critical mass. But maybe I'll push you a little bit.

Are you really going to see an acceleration of growth? Or do we -- should we think about it in terms of that accelerating factor more of a post-2024 as the thing gains a bit more momentum and adds more verticals?

No, it's a good question. So we had a call last Friday with that same question: What should we budget on both sides for sales that we expect?

So for now, the deal has been done. We haven't created an internal budget.

But by the next quarter, we'll have a lot of visibility. We expect impact this year.

What amount, difficult to know. But for sure, it's only going to be positive on increasing our sales.

It's only positive news of having more territory, more salespeople and a national territory. And just on both sides, we haven't given ourselves a budget yet of what that impact will be this year, but we expect it to be material, not significant.

But again, early stage, but only upside. Is there going to be an extra $5 million, $10 million, $20 million?

We don't know. But anywhere from $5 million to $20 million extra sales this year that we expect with this partnership.

And then next year, sky is the limit in terms of us working well, and also evangelizing the market. Our biggest issue is evangelizing the market.

Okay. And just one other question.

You touched on the better economics coming out of the SVOD business, notwithstanding the fact that there was a bit of a dip on SVOD subscribers. When we think about this, at one point, you had talked -- and I know you've updated it since.

But at one point, it was going to be potentially $100 million rev business on the back of 1 million subscribers. You're eventually going to get perhaps to 1 billion subscribers.

But would you characterize this as potentially sort of a $50 million to $60 million revenue business? Or could it actually scale beyond that?

Yes. I think for sure, we'll hit 1 million subs just with the launch of the new countries with Amazon.

We're launching in about 20 new countries, I mentioned on the call. Plus, we're launching also new products with Zen Life, which is an SVOD product, with all of our customers.

So adding new products. We're also adding our products with [ Trivia ].

So with the addition of these products, it just makes the B2B so much stronger. But again, the B2C is declining, so there's a bit of pivot between B2C and B2B.

But our clients are very stable, and we're adding new clients. So again, 1 million subscribers.

We hopefully [indiscernible] this year. We'll see.

Maybe it's going to take maybe 18 months, but it's also always growing. And it is going to be a $60 million business going to $80 million.

[ You can guess ] our ARPU is $5 instead of $15. When you B2B, you're at $5 ARPU.

When you B2C, you're at $15.

I wanted to follow up on the Mood Media. I'm curious if there are any impacts on the cost side.

Or are there any -- is there any spending you have to do, whether it's on the sales force side or integration of technology? Should we expect any impact to margins at all?

Scott, it's one of the rare deals that we said to the Board, "Hey, it's only a win-win-win." So win, we have more retailers.

Win, we have more salespeople. We're using -- we're working together.

We're marketing the product together. So we're just leveraging each other straight.

So no cost impact and more efficient, and we expect results. Our goal is we expect results as early as this month.

So it's not something that we want to see in Q4. We expect results in August, September.

And hopefully, we can report some numbers to you by November. But we expect a new sale on what we call a cross-border sale or cross-territory sale any week now.

So very excited. And like I said to Adam, anywhere from $5 million to $20 million of sales this year, tough to see.

But I think it's going to be -- it's a great partnership. And also for the market and for the retailers and the advertisers, it gives them a good sense that they're teaming up with the right partners.

Okay. And then I might just drill a little further on some of the growth expectations.

So last quarter, you were talking to 40% growth expectations in advertising. You're still targeting that.

But should we expect the Mood Media deal to add on top of that 40%? Or is it sort of now still 40% with Mood Media?

Yes. I would still keep it at 40% for now, and let's wait for next quarter.

Let's wait -- the proof is in the pudding. Let's wait to see how the synergies -- the positive synergies of this partnership comes in.

And the speed. For me, we're very confident that we're going to be doubling sales over the next 24 months.

It's just how quickly is the speed going to happen. So I think we'll have more visibility by the next quarter because now we've only been 2 weeks in the partnership.

So we're like newlyweds. We're still in the honeymoon.

Fair enough. It's early days.

And maybe I'll just ask one on the in-car side. Last quarter, you talked to the run rate being around $8 million on the Karaoke in-car business.

Any color on how much the BYD deal adds to that?

Yes. So BYD starts by about -- around 50,000 a month in October, but they're expected to do 4 million cars a year.

So 4 million cars a year, we're looking -- that's about roughly, round numbers, just that by itself is another $8 million to $10 million a year in business from BYD. The big thing for them is they have their plant in Ontario, as you know.

They're very strong in Europe, Lat Am. But now the big question is when will they launch in the U.S., and I think that one is more geopolitical than business.

So that -- we're getting ready for the U.S. So again, biggest partner in BYD is Warren Buffett.

The company was, last quarter, like $130 billion. Not well known in North America, by us Canadians.

But it's -- we visited them, and we're going to visit them in China in September. It's an incredible company in terms of production and size and what they do.

So very happy to be their international partner. And with BYD, we're launching Karaoke.

We're also launching Calm Radio. So we're going to have our Calm Radio stations in every car, and we're launching many more products.

So it's not only Karaoke. We're really becoming the in-car music, entertainment.

See us at the XM Sirius for EV cars, but around the world. So that's how Stingray is being positioned.

But OEMs, BYD, the deal we have right now, it's going to be over 15 years. So they're looking from 2022 to 2037.

So I'm going to be almost 70 years old by the time this deal is over. So I think I might be -- I'd still be working, but I may be less productive.

All right. Well, it does sound like a good opportunity.

I'll leave it there.

Yes. And we'll get more visibility with time on all the car dealership.

They're all starting with EV. So everything is [ new ] even for Audi.

Audi rolling out their cars. So one thing that I'll ask the analysts is maybe we could do a research of how many cars -- how many EV cars over the next 10 years and then we could start doing a modeling.

So maybe one of you analysts can take a project if you have some extra time in the summer.

Just on these numbers you just provided on the BYD deal. You talked about going from 50,000 a month to potentially another $8 million to $10 million a year.

What would that revenue be contingent on? Is that the current expectation that this could be the growth for next year?

It's more -- it's how -- the difference between us and car manufacturers, we, at Stingray, are used to thinking about 6 to 12 months. They think 6 to 12 years.

So it's a different mindset. Audi is ramping up to be ready for 2026.

So for us, 2026 is like -- but once you're in the cars, you're in the cars for the whole length of the agreement. Once you're embedded, you're embedded forever in that car.

So that's what we're doing. So we know we're going to be in every car.

We know where our position is. We just don't know how fast that Audi and BYD -- we know Tesla.

Tesla right now is ramping up by 100,000 cars a month. So that's easy to model.

Every month, we get 100,000 new cars. We get our fees per car.

So our revenues increased by about $15,000 a month. I'm keeping numbers round here.

So that's easy to model. With the new players, we'll have to see how their production output goes and how quickly they deliver those EV cars.

There's no doubt that the car business, when I was talking about vectors, SVOD is going to be a $100 million business. Retail media will be a $100 million business, for sure.

The FAST channel also, we're growing very -- around the world and all the TV manufacturers. That's also another business for $100 million.

And the cars will also be a $100 million business. The question is, is it going to be in 2, 3 or 4 years, and we'll have more visibility.

But all these vectors are high gross margin of 90% plus. Very little CapEx because it's all -- you deliver once and it's the same content.

And it's going to be increasing for the next -- what we can tell you is that the EV market will increase for the next 10 to 20 years. So you're going to have a rising lake in this space.

And if you're involved, everybody will make money. So it's the opposite of cable industry.

[ What's even a good ] question is I feel that the cars will be replaced the cable industry. You'll get your entertainment from your car in the future more than you get it from your cable [ that sits ] at home.

Okay. Great.

And I think it's fair to say you previously assumed those kind of deals with the car OEMs would take years to materialize, but we've seen a few deals lately, frankly. So are [indiscernible] accelerating in general?

Or was this deal specific to BYD?

Yes. So BYD, we're launching with 300,000 cars in October.

So we're launching with 50,000 a month. And then it's all based on their production, how many cars are they going to produce.

And all of our deals, by the way, excluding China, we don't provide music or Karaoke in China for licensing purposes. We don't understand the licensing rights there.

We don't want to get involved. So it's car manufactured -- car delivered outside of China.

So we'll have to see the production of BYD. And we've seen some of the cars in Canada.

We've seen their cars when we go to Europe. We see their cars in Lat Am.

So how quickly -- I think they're delivering an electric car in for USD 22,000. So pretty nice-looking cars.

People are going to be jumping on those cars. I'm not a car guy, but it's going to be interesting to see those sales over the next few quarters.

Great. And one last for me.

Year out, I think it's a new guidance for advertising revenue doubling in the next 2 years. What needs to happen in operational terms for you to meet this guidance, maybe in terms of CPM for retail media or other factors?

Really, our #1 goal is to get more salespeople, to have more people on the street. I know it's good old-fashioned sales.

We need to be able to evangelize the market, evangelize agencies, both across Canada and the U.S. And also, we're looking to go international.

So we're looking in Australia and other countries. We're starting to get international deals, but our focus is on Canada and the U.S.

and that's it. So our big investment will be to add 5, 10, 15 new headcounts in sales that will produce results.

So it's purely a sales execution. There's no technology.

There's no -- we don't need more footprint. We will get more footprint.

It's really about executing and selling and evangelizing. And the other part we're realizing, once we convince a product -- an agency about one of our campaign, the repeat business is 90% to 95%.

So once you get a customer on board, they stay with you forever. So it's really great.

We're really excited. In Canada, last year, we had 10 campaigns.

At the same time, this year, we had 53 campaigns launched. A lot of small campaigns.

So we already have 5x more campaigns than we did last year. So that will be -- with that, you need more salespeople.

So again, that's both on our side and Mood. So we'll both need to expand our sales team.

Just 2 follow-ups for me on back to the connected car. Yes, Eric, I think a bunch of us on this call used to cover the old Canadian Sirius XM, and it was a fascinating kind of ramp-up on that model.

I just want to know kind of how you generate revenue and at what phase or stage you do that with these contracts. And then the second question, just back to the doubling of revenues in Stingray Advertising.

Just given an evolving revenue mix with that kind of growth, are you still looking at 40% margin for the Broadcast and Commercial Music segment?

Yes. So for the car business, it's the good old cable industry.

So [ the goal ], cost per subscriber or cost per car, so it's a CPS model. Depending on the deals, we'll give them a free period just like when you rent a building, you give them 3 free months.

So that's amortized. But most of the deals should be accretive right away.

So example, BYD starting in October. It really depends on the rollout of the cars.

Some car manufacturers will start with a basic of 1 million cars. Some will start at 0.

So when you start at 0, it takes time to ramp up. So that -- and that model will only expand as they build more cars.

So I think it's the -- and we enjoy the CPS business like we enjoy the cable side. So we'll get more visibility on production of cars.

And regarding the margin, yes, our margin -- we still expect our margin to be like you saw this quarter. This quarter, our broadcast margin was 42.3%, up from 36% last year.

Two reasons. Our cost initiative, yes.

But the main reason is when we focus on big customers, our margin is much higher. Bigger customers, easier.

Amazon, we're in 30 countries, going to 60, but we get 1 check per month. And so the accountant only has to deposit one check.

It's not even a check. It's a wire transfer.

It's one delivery for the world. So imagine being able to deliver in 60 countries by 1 delivery.

So when you're a B2B, your gross margin is much higher -- your gross profit, which gives us an EBITDA margin -- and right now we're 42%. So very comfortable to be above 40% in broadcast for now and to be increasing in the future once we do those big deals.

To deliver to one Tesla or to deliver right now to 2 million Tesla, 3 million Tesla is the same [ fee ]. It's a broadcast -- it's one [ fee going to ] Tesla.

So there's no extra cost. So it's like the good old cable days like if you have a -- it's really broadcasting.

A couple for me. Just back to the electric vehicle model.

Your revenue from the customer, is that a flat fee through the length of the deal? Or does that accelerate or go down after you're through a preview period?

I'm just curious if you're effectively -- your ARPU and your customer base is flat or whether it will go up. And then secondly, on the Radio business, you talked about you're gaining market share.

Are you talking about major markets there? Or are you talking about smaller markets?

And maybe if you could just comment on the overall health of the business. Is the smaller market radio business performing better than large market given lack of competition from other media and things like that?

Yes. That's a good question.

So really, for the car business, it's like the cable industry, the CPS. So we get paid per car, not per usage.

So if Tesla produces 100,000 new cars, then we get times of fee. Again, we got to be careful with you guys telling our fee.

But it's really a CPS model just like in the cable days where you charge $0.10, $0.15, $0.20 per subscriber, independent if they use it or not. So that -- it does increase over time.

We haven't -- we looked into flat fee, but we haven't done any flat fees for now. Most of the car manufacturers prefer paying per car as they expand their business model.

So does that answer the question for the car?

So is your agreement that every car that comes off the line has your products in? Or is that a customer...

No, no. Every car that comes off the line is embedded with the Karaoke and it becomes a subscriber of ours, except in certain markets like China and maybe Korea with certain suppliers.

But for the Western world, we get a piece of every car. Okay.

And for the radio -- now on radio, every month, we get a report that -- we compare to each other to all the other radio station. We call it the [ trend ] report.

So everybody gives their numbers to an accounting firm. You don't know who's gaining or winning.

But for sure, we're beating the market again. This year, we're up 8% compared to the peers.

So we are -- that's how we know we're getting market share. Good question.

I think we're winning a bit -- there's local salespeople in every radio. Local sales is about [ 6% ] of your sales or more.

So I think we have an advantage with, as you know, some of our peers are decreasing their radio presence and some other companies are even looking to divest. So that creates uncertainty on their side.

So it gives us a chance to hire new people, be stronger and be more present with customers. So we do feel that we have an edge right now in the market, both on the larger station and smaller stations.

But still, radio is tough. I won't -- radio is a tough business.

We don't expect much growth until the car dealership. Remember when I met you, Tim, at the [ Sofitel Hotel ] when you told me about how the radio was good for the car business because you could sell your cars on a weekend.

On a Wednesday, you could make a call and do your ads on Thursday. So we need those cars back in the dealership.

And hopefully, that will be coming back in the next -- and hopefully, those will be EV cars. So we'll make money selling the cars and doing ads, and then we'll make money doing Karaoke and music in the cars.

And just any comment on large market versus small market radio performance in general?

Yes, I think it's very similar. I can get back to you, maybe a follow-up call on that.

[ I have to go ] deeper because we have all the reports. But I would say at first glance, both markets are -- our [ trend ] report is strong in both markets.

Yes. And thank you, again, for the analysts for being up early this morning.

Thank you all of you for being there. Thank you for the team at Stingray.

And again, another great quarter. And thanks for everybody that are shareholders that have confidence in Stingray.

And hopefully, we can continue growth and good margins. So have a great day, everyone.

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