Operator: Good day, everyone. Welcome to the Groupon's Fourth Quarter and Full Year 2012 Financial Results Conference Call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the Company's formal remarks. Today's conference call is being recorded.
For opening remarks, I'd like to turn the call over to the Senior Director of Investor Relations, Genny Konz. Please go ahead.
Genny Konz - IR: Hello, and welcome to our fourth quarter and full year 2012 financial results conference call. On the call are Andrew Mason, our CEO; and Jason Child, our CFO; in addition, Kal Raman, our Chief Operating Officer will join us today. The following discussion and responses to your questions reflect management's views as of today February 27, 2013, only and will include forward-looking statements. Actual results may differ materially. Additional information about factors that could potentially impact our financial results is included in today's press release and in our filings with the SEC including our Form 10-K.
During this call, we will discuss certain non-GAAP financial measures in our press release and our filings with the SEC each of which is posted on our IR website. You will find additional disclosures regarding non-GAAP measures including reconciliations of these measures with GAAP measures. Finally, unless otherwise stated all comparisons in this call will be against our results for the comparable period of 2011.
Now, I will turn the call over to Andrew.
Andrew Mason - CEO: Thanks, Genny. Q4 provided the best evidence yet that customers love Groupon. First and foremost, we had our strongest sequential increase in absolute billings dollars in our history growing more than $300 million stronger than our previous record by over $40 million and growth reaccelerated to 25% quarter-over-quarter.
The billings growth was across the board with local travel and goods both in North America and international all seeing strong sequential increases. We also set a new unit sales record in Q4 exceeding $50 million sold for the first time. This is proof once again of the power of our buying platform and network that didn't exist just a little over four years ago and now supports over $5 billion of commerce.
Executing on our belief that scale does matter in this business, our results reflect a deliberate and aggressive focus on growth of our platform and segment market share as well as our willingness to trade-off short-term operating profitability. We expect our operating margins to improve in 2013 as we fine-tune our take rates and automate manual processes that will significantly improve our cost structure going forward. We are also reiterating the long-term operating margin targets that we've shared with you previously.
Excluding stock-based compensation and acquisition0related expenses, our operating profit came in at $14 million in Q4. There were three main drivers of what we expect to be a temporary reduction in operating margins. First, Q4 is a seasonally strong quarter for our goods business. As we've discussed before growth of goods, the direct portion of which carries lower margins has impacted our overall margins as it has grown materially over the last few quarters reaching an impressive $2 billion annual billings run rate in Q4. Second, we reduced local margins in the quarter as part of an aggressive campaign to drive growth by attracting more top merchants to Groupon.