Michael Porter - VP, Finance and IR Bob Rosenblatt - CEO Anne Martin-Vachon - President Diana Purcel - EVP and CFO

Mark Argento - Lake Street Capital Thomas Forte - D.A. Davidson Mark Rosenkranz - Craig-Hallum

Greetings and welcome to Evine Live Second Quarter 2018 Earnings Conference Call. At this time, all participants will be in a listen-only-mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions]. As a reminder, this conference is being recorded. I would now like to turn the conference over to Michael Porter, Vice President of Finance and Investor Relations. Please go ahead, sir.

Good morning and thank you for joining us. Joining me on today's call is our CEO, Bob Rosenblatt; our newly appointed president Anne Martin-Vachon; and our CFO, Diana Purcel. We issued our earnings release earlier this morning. If you do not have a copy, you may access it through the News section of our IR website. The earnings release is also an exhibit to our Form 8-K which was filed this morning and can be accessed through the Financials SEC Filings section of our IR website. Some of the statements that we make during this call are considered forward-looking and are subject to significant risks and uncertainties. These statements reflect our expectations about future operating and financial performance and speak only as of today's date. We undertake no obligation to update or revise these forward-looking statements for any reason. We believe the expectations reflected in our forward-looking statements are reasonable, but give no assurance such expectations or any of our forward-looking statements will prove to be correct. Please refer to the Safe Harbor section in today's earnings release and our SEC filings for additional information. Finally, we will make reference to non-GAAP measures on this call such as adjusted EBITDA. The information required to be disclosed about these measures including reconciliations to the most comparable GAAP measures are included within the earnings release. Now, I would like to turn the call over to Bob.

Thanks, Michael. And good morning, everyone. We had another productive quarter which not only generated revenue growth year-over-year but also a 12% increase in adjusted EBITDA, resulting in our best second quarter net income since fiscal year 2000. We are quickly progressing towards our goal of being a leading interactive digital commerce company and are firmly situated at the intersection of retail, entertainment and technology. This combination leaves us uniquely positioned to deliver immersive interactive experience to our customers. Our merchandising team travels the world to curate exclusive products that have a unique story and partners with them to bring the products to life across all platforms in an effort to maximize the brand's potential. On the retail side, we continue to focus on adding to our merchandising assortment and finding products to not only meet the needs and wants of our customers but to exceed their expectations with exciting new discoveries. To that end, we launched 17 new brands in the quarter in addition to some highly anticipated new product launches including Ready to Wear cosmetics which made its debut on the network in July. This established brand from Italy uses proprietary manufacturing processes that permits the customer to create a more personalized look to align with their own unique style. The premier exceeded our expectations completely selling out of 10 of our 15 offerings. It was the most successful launch we've had in the color cosmetic space in Evine's history. We also had successful launches with Nutritionary, an exclusive to Evine meal replacement and nutrition line in partnership with Heather Thomson that launched in May with many sellouts as well as Fig & Vine a proprietary fashion collection that launched in June. Fig & Vine was designed and inspired to give our shoppers an exclusive collection that featured high-end casual resort style looks at an excellent value. We ended the quarter with the highly anticipated DC Comics exclusive premier from Invicta watches, which was simulcasted live from the Time Square Invicta stores jumbotron and included limited edition time pieces featuring iconic characters such as Wonder Woman, Batman and Superman. This premier was the latest collaboration between Invicta and Evine following similar themed partnerships including the characters from the Marvel Universe, Star Wars and Disney to name just a few. Outside of new launches, we also celebrated some key milestone anniversaries during the quarter. Gems en Vogue and Michael Vallatuti celebrated 20 years at the network, and in their time with us have generated over $300 million in sales, offering fine jewelry featuring precious or semi-precious stones. Skinn Cosmetics and Dimitri James celebrated 10 years with us and MacKenzie-Childs the brand known for its distinctive vibrant and whimsical tableware designs, celebrated their first anniversary. These milestone anniversaries illustrate the breadth in our assortment and our ability to build unique longstanding brands as well as nurturing and building up in coming brands. From an entertainment perspective, as the retail industry continues to be disrupted and as customers change how they choose to consume content so does Evine, whether it's via our remote broadcast that virtually transport our customers to Waterford's artisans of Ireland, the Invicta Cruise on the Caribbean, to the floors of the gem shows in Las Vegas or to Paula Deen's home in Savanah, Georgia. Our theme shows that air at the same time on a continued basis, which result in some of our highest viewership like Morning Perk, Wake up in Style or The Sizzle or educational programming such as Evine after Dark, Evine has been and is committed to remain at the cutting edge of providing entertaining content. All the while ensuring that customers have frictionless access and the ability to transact and to view content across all platforms based on the methods that they prefer. Evine remains fully distributed to over 87 million television homes and we are focused on increasing our presence on all other relevant platforms as is dictated by our customers' desires and as technology permits. For example, we continue to experience growth with over-the-top content distribution platforms. On a year-over-year basis, second quarter Roku installations increased 27% and usage increased 59%. We also accelerated the execution of live content storytelling across Facebook Live and YouTube during the quarter increasing the total minutes viewed by 15 % compared to the first quarter. We believe that these additional platforms are differentiators for us in the long-term as we provide additional avenues for our customers to access our brands and products in a convenient manner. Finally, I’d like to highlight our second annual All-Star Event we held earlier this month after the second quarter ended. This multi-platform event was brought back last year after an eight year hiatus and is our annual celebration where we honor some of our top brand partners, both the veterans and newcomers who make our network so special. An event kicked off with an award ceremony which was streamed live on Facebook from our gold carpet with our host Kimberly Wells as she interviewed some of our favorite Evine personalities. Later that night, we shared our entertainment award program with our customers via livestream on YouTube. Throughout the four day All-Star experience, shoppers were able to take advantage of special pricing and limited time offers on exclusive items. The event exceeded both expectations and sales levels compared to last year. Lastly, with regard to technology, we continued to invest in fully building out our direct-to-consumer and increasingly valuable video commerce platforms. These investments include our state-of-the-art broadcast studios in Minnesota as well as our wholly-owned 600,000 square foot fulfillment center in Kentucky where we upgraded to a best-in-class warehouse management system. Additionally as customer expectations continue to increase, we continue to invest in upgrades in our website and mobile platforms with a focus on creating a seamless experience across all of our platforms. 52.6% of our sales in the second quarter were generated from our digital platforms, representing an increase of 450 basis points compared to last year. Additionally, 55.7% of our digital sales were generated from mobile devices, which was an increase of 630 basis points compared to last year. As I said earlier, Evine sits solidly at the intersection of three evolving industries; retail, entertainment and technology. And we are uniquely positioned to adapt and evolve to an ever changing retail landscape. I now want to introduce you to our President Anne Martin-Vachon. Ann started with us earlier this month and is responsible for our front-of-the-house operations including merchandising, marketing, broadcasting, digital and production. She comes to us with over 25 years of consumer and retail experience serving most recently as President of the Canadian multiplatform e-commerce company TSC, Today’s Shopping Choice, a division of Rogers Media. And before that, as the Chief Merchandising Planning and Programming Officer at HSN. She has a strong track record, particularly in areas that are well aligned with the next phase of our strategy vis-à-vis growing the customer base, supercharging the merchandise portfolio and improving the broadcast and digital content experience to deepen customer engagement. Sufficed to say we are fortunate and very excited to have her on our team. In the near-term I will continue to spend the necessary amount of my time working closely with Ann and the front-of-the-house team and related partners to ensure that she has everything that she needs to continue to build the Evine business. Over the past 10 quarters, we have worked diligently to ensure that Evine is equipped with all the tools necessary to drive profitable growth on a go forward basis in this ever changing retail landscape with significant upside potential. We have built a scalable business model, supported by a strong balance sheet, process controls and systems, along with a world class senior leadership team. With Ann focusing on the customer facing operations I now have the ability to spend more time furthering our strategy as well as having more time to speak with our current and future investors to better articulate our company’s go forward strategy. I will continue to drive our key operating priorities including growing our HD footprint and maximizing utilization of our unique assets. The latter includes finding strategic partners who can benefit from a marketing, merchandising and merchandise distribution point of view from our fully distributed TV and web presence in the United States. This is the third year into our three year turnaround. And as previously mentioned, our focus this year is on profitable sales growth. We delivered another solid quarter which has given our entire company further confidence as we look to the future. With that, I'd like to officially welcome Ann to our team and have her provide more detail on our progress. Anne Martin-Vachon: Good morning. I'm very excited to be here. I thought I would start out by sharing my thoughts with you as to why I wanted to join Evine. At its core I was able to check off every single box that is important to me. First, it is in the consumer industry. I love helping people find products that make their lives easier or help them feel better about themselves. The Evine brands and products do this every single day. Second, there is significant opportunity for the business to become substantially larger than it is. There is no reason why Evine cannot expand its market share. We simply are low on the number of customers we serve compared to the access to potential customers we have, growing the customer base with a key initiative for me before I came to Evine and I believe many of the actions that I used at TSC will help us here. Third, there is alignment. Bob has done a great job aligning the company on primary tenants which serve as the foundation for our strategy in establishing a strong and collaborative culture that is ready to win. It makes much easier to change, enhance or expand when there is alignment. Fourth, based on my background, I'm fortunate enough to be in a position to be able to make an immediate impact. Once I knew I would be joining Evine, I began working with the team on a list of strategies to help drive growth and profitability. There are many opportunities and my direct experience can help Evine with customer engagement, customer retention and growth and our curated merchandising assortment. It was exciting to me from the very beginning to know that there is a strong correlation between what I have done and what Evine needs. Now that you know the why, I will give you an update on the side pillars driving my focus. Number one is customers. We have to do everything we can to increase the number of customers we serve and extend the loyalty of the customers we already serve. Both of these need to be at the forefront of everything we do every single day. We will embrace and retain our current customer base and look for ways to attract new to grow our customer file. During the second quarter, our customer file declined 3% compared to the second quarter of last year. Although this was sequentially better than the 7% decline in the first quarter, we'd like to accelerate to be in the positive territory as it is one of the leading indicators that will drive continued business success. The good news is that the customer retention trends and purchase frequency remained quite strong. During the quarter, we grew our purchase frequency by 4% representing the 8th consecutive quarter of growth. Good news is we are growing customer loyalty. Now we also need to grow our customer base. I look forward to continuing to reinforce and strengthen this customer first philosophy in the organization. The second pillar is our curated portfolio of brands and products. One of our competitive advantages is our ability to use our powerful multimedia platform to tell the compelling stories behind our great products. The art of this platform is our ability to take the customer on a journey of discovery. This doesn't happen overnight. We are not simply an editing function or aggregator of products and brands. We are a curator that builds brands over time by telling their story and keeping them fresh and relevant along this journey. Great product, great story, told by great storytellers. As Bob mentioned, we have a strong table of brands at Evine, some of which have been around for over 20 years, and others that are just being introduced to our customer base. We will continue to find great brands and great products from around the world and showcase them in whatever platform they choose, television, over-the-top, web, mobile, social or the next best thing to come along. That brings me to our third pillar, content. Storytelling across our broadcast and digital platforms is central to our success and we will continue to raise the bar to entertain, delight and engage our customers. We leverage our unique platform to tell stories about great brands and products. And we need to continue to keep this fresh and relevant for our viewers. We need to curate fun, entertaining and informative content. And we need to distribute that content to all of the customer touch points that are relevant. Customer experience is the fourth pillar. I believe that our customer is our boss. Every single one of us answers to our customer. As such, flawless execution to deliver the best-in-class customer experience is paramount to what we need to do day-in and day-out. The fifth and most important pillar is the people and the culture. Bob and the executive team have built a team that is aligned and ready to win. My philosophy is, do what you love, and you will excel. I believe in passion and fun. I believe in partnership, trust and accountability. In my short time here, I've already seen a lot of those qualities around the organization. The team here is the heart and soul of the business, our most valuable resource and our most powerful engine for growth and success. The entire team is aligned around these five pillars. And if we hit on them day-in and day-out, sustainable revenue growth and expanding profitability will result. Again, I am extremely honored to have the opportunity to be part of the Evine story and I look forward to exceeding the expectations of our customers, employees, brand and vendor partners, and importantly, shareholders. I will now pass the call over to Diana for additional details on our financial results and capital structure. Thank you.

Thanks, Anne. And good morning, everyone. Thank you for joining us today. As you can tell from Bob and Ann’s comments, confidence continues to grow as we had another good quarter, and we look to continue that momentum as we head into the second half of the year. I'd like to start off with some additional color on our second quarter financial performance. Our revenue increased in the second quarter, predominantly due to continued expansion within the Beauty & Wellness category, which grew 27% as compared to the prior year. And the growth in this category reflects the continued focus on our subscription business which grew 61% year-over-year. Our Jewelry & Watches and Home & CE categories were both relatively flat in the quarter while our Fashion category declined. Our return rate was 18.7% in the quarter which was a 40 basis point improvement year-over-year. Return rates across most merchandise categories improved with the largest improvements coming from our Watchers and Beauty categories. Our gross margin percentage was in line with the prior year reflecting a 20 basis point decrease year-over-year. This modest decline was driven by rate pressure particularly within the Fashion & Accessories category and was partially offset by favorable mix into the higher margin Beauty & Wellness category. We had a good quarter with expense management. In total, operating expenses decreased approximately $1 million as compared to last year with the largest driver being a $729,000 decrease in our distribution and selling expenses. We had great performance within our key variable costs, including our primary operational functions, our customer solutions group, our fulfillment and logistics center and our credit and payments group. Variable expenses for the quarter were 8.9% of total net sales compared to 9.8% last year, a 90 basis point improvement. These expense reductions were driven by efficiency improvements in our fulfillment center as they continue to realize the benefits of our upgraded warehouse management system and a reduction in bad debt expense as we maintained discipline in our credit and payments group. The reductions in variable costs helped to offset the increases that we are seeing in content distribution cost stemming from our investment into the HD channels that went into effect in the back half of last year. As Ann mentioned earlier, content distribution continues to be a key tenant of our strategy. We remain in more than 87 million homes as of the end of the second quarter including over 35 million HD homes, both consistent with where we were last quarter. We continue to seek and evaluate opportunities to increase the number of HD channels and neighborhoods we are in and we continue to seek additional exposure on other distribution platforms such as over-the-top and social. We also saw a benefit in the quarter from lower interest expense as interest expense of approximately $900,000 was $415,000 or 32% less than interest expense for the second quarter of last year. As I mentioned last quarter, this decrease is due to our debt reduction over the past year particularly the payoff of our high interest debt. Bringing it all together, we delivered $3.9 million of adjusted EBITDA in the quarter which was a 12% increase compared to the second quarter of 2017. This is the fourth consecutive quarter and eighth of the past 10 quarters where we have increased adjusted EBITDA year-over-year and is our best second quarter adjusted EBITDA performance since fiscal year 2014. From a bottom-line perspective, we were nearly breakeven reflecting an approximate $2 million improvement year-over-year and we delivered a 3 penny improvement on EPS. As Bob mentioned, this was our best second quarter earnings per share since fiscal 2000. Turning to the balance sheet, we amended our credit facility with PNC during the quarter to further strengthen our liquidity position. Among other things, this amendment reduces our interest on LIBOR loans under the revolving credit facility by 1% and under the term loan facility by 2.5%. Additionally, it increases our total availability by approximately $10 million and extends the maturity date of the credit facility to July of 2023. We expect to realize approximately $500,000 of annualized interest expense savings from this amendment beginning in the third quarter. We ended the quarter with cash of approximately $28.1 million and had an additional $23.3 million of unused availability on our revolving credit facility giving us total liquidity of approximately $51.4 million. Our inventory balance at the end of the quarter was $65.4 million down $3.4 million from year end. However, up modestly from the same time last year. Our inventory management continues to be strong and disciplined. In addition, we continue to monitor and evaluate the potential impacts for the China tariffs. If further tariffs are implemented, we have options to mitigate our exposure including working with our existing suppliers to move production outside of China looking to other suppliers outside of China for similar products, taking products out of the rotation if they do not meet our internal contribution margin hurdles, adjusting our pricing or finding savings elsewhere to offset the impact. As such, we don't expect the tariffs to have a material impact on this current fiscal year and we will continue to evaluate going forward. On the debt side, we ended the quarter with $68.8 million of debt outstanding, which is down more than $5 million from the beginning of year levels and down almost $8 million from the same time last year. Our debt at the end of the second quarter was at lowest level since the third quarter of fiscal year 2015. Regarding cash flow highlights. During the quarter we spent approximately $2 million on capital projects primarily reflecting investments in upgrades to website optimization, IT infrastructure and customer solution systems. We continue to expect full year capital expenditures to be in the $8 million to $10 million range, of which $4.1 million was incurred during the first half of the year. Lastly, from a tax perspective, we continue to have approximately $321 million of federal NOLs that are available to us to offset future taxable income. In terms of our outlook for full fiscal 2018, we affirm the expectations that we laid out at the beginning of the year and that we reiterated on our first quarter earnings call. As a reminder, fiscal 2018 will have 52 weeks compared to the 53 weeks in fiscal 2017. For revenue, we expect to generate $648 million to $668 million which equates to 2% to 5% growth on a normalized 52-week to 52-week basis and zero to 3% growth on a reported basis. We expect adjusted EBITDA to be between $19 million and $21 million. Again, thank you for joining us today. I'm very pleased with our performance for the quarter as well as our positioning for the near and long-term. With that, we are happy to take your questions.

Thank you. At this time we'll be conducting a question-and-answer session. [Operator Instructions]. Thank you. Our first question is from the line of Mark Argento with Lake Street Capital. Please proceed with your question.

Good morning everybody. Just a couple of quick ones. First off, subscription growth was pretty significant in the quarter. Maybe you could drill down a little bit where what types of subscriptions you see in progress with? And then maybe you could talk a little bit about how the balance sheet continues to improve, what are some of the priorities in terms of incremental investment or where do you focus the additional free cash flow under the debt paydown and any kind of thoughts on that would be great? Thanks.

Sure. Thanks, Mark. Let me start with the subscription business. As I think we've probably started talking more about the subscription business and the fact that we thought there were opportunities in that probably three quarters ago at this point in time and we have gone to great lengths to make sure that we’ve increased the focus on that. Most of that at present is in health and beauty as you would expect, but we are also having some success in some of our other areas especially the collectable areas, where people have a tendency to be fans and want to buy more of a vendor or of a certain style. And we have a small dedicated team that is focused on being able to figure out the best way via any ways we do it whether it would be social media or email or even through the phone to able to continue to drive that business. And once we do that obviously that’s got the best value in terms of profitability because it allows us to be able to be -- not to have to show the products, and we can show new products on air. And if you think about the number of hours that you have is shelf space, it essentially opens up more shelf space. So we feel pretty good about the fact that as we talked about several quarters ago that, that we knew that was a key focus, and we’re going to continue to drive towards that and will continue to reinvest into that to make sure that the customer is satisfied with the experience. Because if the customer is satisfied with the experience and has enough flexibility to be able to either turn on or turn off the subscription model as they feel fit, and as we continue to be able to bring in great product that really delivers great results. We think that continues to be a big opportunity -- a big off-the-air opportunity that we continue to want to mine. In terms of the balance sheet, I could say that obviously we’re in the best shape we’ve been in for -- I don't know -- how many years has it's been since it's the balance sheet, I think at four years, five years something like this. So, we’re in really good shape with the balance sheet, and as you know I'm a pretty conservative guy. And it was really important for me to be able to have some powder, if you will dry powder to be able to utilize it to take advantage of opportunities. And now that Anne is aboard and is starting to do a deep dive into each one of the areas, the place we think is the opporutnities is to be able to go out and find the best products that are out there and be able to make the smart bets now that we have the right parameters in place to make sure that from an inventory standpoint, we can balance the inventory, the cash against potential revenue, and potential customer growth. And we are in the midst of trying to figure out the best way to do that. That being said, we are and we’ll continue to be opportunistic. If we find -- if we find and now that I’ve Anne aboard I'll be able to have more opportunity to do this. I hope to be able to spend more time being able to evaluate other businesses as that are strategic to us and that we can have opportunities to look at. But again, the key to me at this point is that we are leaders in video commence, and as you guys can see that a lot of that has to do with the growth that we’re having online, whether it be mobile or whether it be through the digital on desktops. So, we’re going to continue to focus on that as an opportunistic way to be able to grow the business, but we’d be interested in that as well. And I think from balance sheet standpoint, we for the first time now have the flexibility to be able to figure out the best way to spend the money to get the best return on investment to the customer.

There is one follow-up for Anne. Anne, I know you’ve been there for a month or so, but from your perspective, what’s the one single thing that you see that creates the biggest opportunity that start growing the top line again? Is it customers, products? What’s the one key lever? I know there is multiple levers, but if you had to pick one, what would that one be? Anne Martin-Vachon: Good morning, Mark. So, you’re absolutely, right. The beginning of week four, so under a month, and I will tell you that you’ve hit it perfectly dead on. It is absolutely the customer and the customer of growth as well as the product and brands in the portfolio of curated products that we carry correct.

Anne won't say it, but I’ll say is for her, is that, during the time that she was at HSN having responsibilities for the breadh of the merchandise area, they had the largest growth in customers as well as the larger sales growth. So, I’m really comfortable that we have found the right match to be able to drive the business the correct way.

The next question is from the line of Thomas Forte with D.A. Davidson. Please proceed with your questions.

Great. Thanks for taking my question. So now it looks like, you're on track to meet your goal for profitable sales growth in 2018. I was curious to find out your thoughts on your long term financial model including sales growth margins and free cash flow generation?

Thanks Tom. Great question. We are not ready to and I've learned this the hard way over years of working with companies for long periods of time. We were not ready to declare victory per se as of yet. We've got so much opportunity to be able to. At this point, now that we have the model right. Just driving revenue with the right business plan that we have in place is going to be able to throw off -- should throw off a bunch of money. And as you know, we have NOL so any of the incremental moneys that we throw off, we're not paying -- we're not going to have to pay taxes for it. So, we're looking at the third and fourth quarter, and in this ever changing business that we're in and god knows we're in retail we're in ever changing business, we look focused on the third and fourth quarter and being able to deliver the best results possible with being mindful to the fact that there is a lot of customers out there that are looking for alternatives in terms of being able to shop. And because we have really just begun our HD rollout, I think we began it really in September in earnest. And we made another big investment in HD in December. The key for us now I think is to be able to make sure that any customers out there who like this medium whether it would online or whether it would be on air know about us, our passion about the brands that we're bringing and building. And so for now, we're going to be focused on the second, the third and fourth quarter. And as I am able to be able to peel off more, we'll talk about the other components as it becomes relevant. But for now, the focus continues to be let's drive third and fourth quarter.

So then as a quick follow on, what gives you confidence simply than on a go-forward basis, on a full year basis, you'll be able to continue to generate profitable sale growth from hereon out?

Well, I think that we are happy with the growth that we're seeing based on the HD Homes that we have acquired -- the HD channels, I should say, that we've acquired that we've gone on to now. It takes 12 to 18 months to be able to get the full maturity on that. And we want to make sure that we reach out to them and let them know that we're there. At the same time, we are continuing to drive more vendors here, more vendor partners here. And also accelerate the marketing effort to be able to let people know that we're here. And so for us, it's really a matter of the blocking and tackling to be able to ensure that the base is solid in order to be able to have the accretive growth going forward. And I think that probably trumps, at this point, all the other things that we want to talk about at this point from that point of view.

Our next question is coming from the line of Mark Rosenkranz with Craig-Hallum. Please proceed with your question.

I wonder if you could talk a little bit about second half. It looks like you're implying a decent amount of growth in the second half. Wondering if there was anything specifically that you're looking forward. Is it the HD Channels? Is it alternate distribution? Or is just addition of new brands? Just kind of what are the key areas you're keep an eye on as you approach the second half?

Yes, I know you’re getting on all this three that we are totally focused. If you were here, you would see a triangle that we’ve put up for every quarterly meeting here that talks about those three things. And we have -- the power of having the entire company focused on those specific items and seeing the growth that we’re seeing especially on the new brand pieces as well as the reinvigoration on some of our core brands that we mentioned earlier, Gems en Vogue and Invicta. We want to continue to be able to bring new brands and new products in that are in what we call the white spaces, which is areas that we have not yet been able to -- we don’t have merchandise that our customers that looks like our customer would buy and so we’re actively looking in there. A lot of that happens to be in the apparel space as well as in some of the home space, and we are focused on that and we have a lineup we know already of many new vendors that are coming on that and fill those white spaces. And a combination of that and being able to get customers to focus on us that as an alternative to the other choices out there in terms of a lot of exclusive and proprietary merchandise that’s out there is something that’s been the secret to our formula in the sense that as opposed to be editors of everything that’s out there, we want to continue to be the people that focus on great being brand builders and being able to make sure that we are able to bring a story alive. And we don’t think there is anybody out there that can do it as well. And I would much rather use our space both online and on air to be able to be brand builders and to work with great brands that our merchants are able to find and actually work with them with our team whose core competency is helping to find their strength of the vendor partners and bring those stories to life. And we believe that there is nobody out there that can do it better than us. So that is really the focus on where we’re going to be and it gives me the confidence, also the veteran team that we have and it's being around for a while now understand how to be able to drive this. And we then leading the charge on the front the house piece of it, it’s a great feeling for me to know that everybody is working almost as one body for the first time ever.

Okay, great. And then moving on the digital mobile side, you guys can see really strong growth. Just wondering, if there is any kind of particular drivers for that? Is that just an improved interface overall? Are you seeing a better traction with different brands that are more conducive in online experience? Or is it just a different type of customer that you’ve been adding on? And it's kind of feel the way that kind of the strong digital growth you see?

Sure, it’s a matter of focus. One of the things that was not here before is, we redeveloped a very strong by division alliance between the marketing departments and the merchandise department. And by doing that, it allows us to be looking at through the lens of saying -- of trying to solve the issue or the problem with the opportunity I think what is the best way to be able to get this customer to be able to get this customer to be able to shop with us. How do they prefer to shop? So in answer to your question, yes, absolutely, we find there are differences, and the analytics show that there were differences between the customer that are shopping on digital in many of the cases and the customers that are shopping on TV, and there is even -- obviously, the nuances on digital, the ones that are shopping on laptops versus the ones that are shopping on mobile. Our point of view is, we have to solve the issue of saying whatever the customer really wants is that what we want to be able to do, we want to make it. So, we are working very hard and we’ve made some big changes to our mobile checkout procedure to make the checkout process as seamless as possible. And the more we work on making the entire shopping experience as seamless as possible, we think that and having great merchandise that is not available all over the place, and the idea of discovery and being able to [culture] great pieces of merchandise is really where we will be able to stand out. And we think that that is something that has longlasting effects beyond just TV shopping if you will to just people who want to shop in general.

Thank you. Ladies and gentlemen, we reached the end of our question-and-answer session. I would like to turn the call back to Bob Rosenblatt for closing remarks.

Thanks so much. So, I'd like to thank everybody for participating in our business update today. We remain energized about our progress. But honestly, there is always more to do in this business. It's part of the fun of this business is that you never know what you're going to wake up to and we love that. So, I want to take this opportunity to thank our employees, our customers, our brand and vendor partners and shareholders for your continued confidence and support, and I hope you have a wonderful rest of the day. Thank you.

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.