Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| And we continue to be optimistic about our mission to connect 1 billion people every day with optimism and civility, not just in gaming, but in entertainment, ultimately in shopping, ultimately in social communication, and ultimately in learning and education where we're making amazing progress as well |
| In terms of the question as why was bookings so strong in the fourth quarter, we like to think it's growing our user base, they're more engaged, the content continues to get better and better, the platform continues to scale |
| We had a strong fourth quarter and a strong full year 2023, consistent with the outlook we made at Investor Day |
| We're seeing strong payer growth really everywhere |
| It was our first quarter over $1 billion in bookings and also our highest quarterly growth rate in two years |
| We saw a -- I don't know if we shared, you could probably go in and figure it out what percent of the top 20 creators on the platform are now offering inexperience subscription, highlighting that we've seen good adoption amongst our creator base |
| And we're pleased to share that, in Q4, we delivered net cash flow from operations of $143 million, up 20% year-on-year, strong net liquidity of $2.2 billion, and our covenant adjusted EBITDA was $259 million |
| We like having a very strong balance sheet |
| And in all four of these dimensions, we made great progress |
| And then just as a follow-up, you are -- now that margins are expanding, free cash flow is once again nicely positive, you have the high quality problem of being on a position of having a good amount of excess cash |
| And these older DAUs are interesting and exciting for the advertising business that we're building |
| As I mentioned earlier, we -- our economy team has a lot of things that are very -- so compelling opportunities to improve monetization |
| And as you see, we're getting good at models that can drive real translation |
| We're getting really good at high volume voice processing for safety and civility, once again on our own infrastructure at low cost |
| And so, I'm certainly excited and optimistic about the ability to continue to improve monetization |
| And several years back, the vast majority of people on our platform were under 13, so seeing the growth over 13 is a really good sign |
| And then, we see very good sequential growth in Q3 with the summer, and then a big sequential jump in Q4 for the holidays and then again back down a little bit in Q1 of the next year |
| On Pages 12 and 13, you can see are growing at a slower rate than bookings growth and that's yielding healthy operating margins and more cash flow from operations |
| So obviously, we're pleased with the '23 results |
| On the immersive communications side, we saw great growth in our voice DAUs |
| We're also in a nice position where we continue to invest in the business, continue to grow and invest, and we're doing that out of operation |
| And then, reduced capital expenditures are yielding significantly higher free cash flow |
| I just met with them all yesterday actually, and it's an amazing team |
| So it's growing, new people all the time, very talented, very excited |
| So, when we have variance in margin, that's okay, just we're going to show margin improvement in each of those quarters and then overall |
| For the full year and fiscal year 2023, DAU is up 22%, hours up 22%, revenue up 26% and bookings of $3.5 billion, up 23% year-on-year |
| Our infrastructure, including edge data centers around the world to supply performance and reliability, great content developers popping up all around the world and continued innovation here |
| I also want to highlight that on a biz dev since prepaid cards wherever we can around the world has also made enormous progress in the last year |
| And as we grow bookings, we grow the economic opportunity on our platform |
| And a big call out, bookings per monthly unique payer was the highest of any Q4 and actually, of course, the highest in the history |
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| What will look odd a little bit in the letter with the guidance as adjusted EBITDA is negative because the deferred is not in there |
| On bookings back to Page 17, normally Q1 is down from the Q4 of the prior year, the holiday season |
| But just DevEx on its own, I think, was below 20% of bookings this quarter, very slightly for the first time in over two years |
| If DAUs happen to grow a little bit faster, then that number might come down a little bit |
| Some industry experts estimate that over 10,000 workers lost their jobs in the video game industry in 2023 |
| And Kotaku reports that over 6,000 have already lost their jobs in January, including 2,000 from Microsoft |
| So, our infrastructure investments have come down pretty significantly |
| These are going to be a little bit difficult for you to get exactly right because of the waterfall of the deferred and the factors that go into determining that number |
| Q2 goes down a little bit because we tend to grow the top-line, but also invest a little bit, and we have some amount of fixed cost growth |
| If they happen to grow more slowly, that number will go up a little bit |
| We were on a couple of new platforms in the fourth quarter, so that clearly had an impact |
| So Q1 is lower because we don't have the working capital benefit |
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