Adyen NV

AEX:ADYEN

Earnings Call Analysis

Strong Growth in Process Volume and Revenue

The company reported a 46% year-on-year increase in process volume to EUR 297.8 billion, driven by a 51% rise in digital volumes and a 30% growth in Unified Commerce. Net revenue increased by 21% to EUR 438 million. The company expects annual net revenue growth in the low to high 20s percentage through 2026, with the low end expected in 2024. North America remains the fastest-growing region, and the company continues to expand its team, with a 15% increase in employees year-on-year, aiming for a more gradual hiring pace moving forward.

Strong Quarterly Performance

The company reported a robust first quarter with process volume reaching EUR 297.8 billion, marking a notable 46% increase year-on-year. Within this, digital volumes surged by 51%, Unified Commerce volumes saw a 30% rise, and the Platforms business experienced a 55% growth. Net revenue for the quarter stood at EUR 438 million, reflecting a 21% growth. This was consistent on a constant currency basis as well【4:0†source】【4:4†source】.

Revenue Guidance and Growth Perspective

For the upcoming years, the company reaffirmed its financial objectives, targeting an annual net revenue growth between the low 20s to high 20s up to 2026. They expect to be at the lower end of this range for 2024, and current performance aligns with this prediction. A significant contributor to revenue growth has been the expansion within existing customer bases, with North America standing out as the fastest-growing region【4:0†source】【4:4†source】.

Customer Expansion Strategy

The company's 'land-and-expand' strategy continues to be a core driver of growth, with over 80% of the quarterly growth originating from existing clients. This successful strategy was exemplified through the substantial volume increase from a key digital customer, alongside multiple other large enterprise accounts【4:0†source】【4:4†source】.

Managing Volume and Revenue Dynamics

Despite the high volume growth, net revenue did not increase at the same rate, attributed to stronger growth from the largest customers who benefit from lower pricing due to higher volumes. The key managerial focus remains on absolute net revenue and profitability rather than take rate percentage【4:6†source】【4:9†source】.

Team Expansion and Long-term Investments

The company added 26 new employees in the first quarter, contributing to a 15% year-on-year increase in team size as of March 2024. Hiring continues, albeit at a measured rate compared to the previous years' significant efforts. The focus is on bringing in senior commercial roles to drive long-term growth, with expectations of a more modest EBITDA margin expansion this year compared to subsequent years【4:4†source】【4:7†source】.

Market Dynamics and Competitive Position

The company's strategy includes maintaining flexible pricing to meet customer needs while focusing on long-term absolute revenue growth. Although new competitive dynamics have not significantly impacted business results, the company's premium value proposition continues to attract larger enterprise customers, evidenced by stable and strategic partnerships【4:9†source】【4:10†source】.

Sector Diversification and Payment Methods

A notable trend is the company's ability to secure wins in the financial sector, with high-profile clients like Klarna and WorldRemit. This move demonstrates the strategic importance of payments within these sectors. Additionally, there is a growing mix of local payment methods complementing traditional card payments, adding complexity but also value in global markets【4:10†source】【4:12†source】.

Outlook and Future Strategy

Looking ahead, the company remains confident in meeting the lower end of its revenue growth guidance for 2024, supported by a broad-based growth strategy across various geographies and customer segments. The continued investment in commercial and technical teams is expected to further position the company as a leader in providing complex payment solutions that add strategic value across industries【4:6†source】【4:14†source】.

Earnings Call Transcript 2024-Q1

[Josh Masser, executive]

Hi, everyone, and thank you for joining our business update call today. My name is Josh Masser, Head of Investor Relations, and I'm joined today by our CFO, Ethan Tandowsky. Building on our Investor Day last November, we are happy to keep the dialogue open with more regular status updates.

The idea of today's short call is to add some color to the progress we've made in the business since our H2 publication in February. We'll start with the brief Q1 overview from Ethan, followed by a live Q&A.

The call will be limited to 30 minutes, so we ask you to please keep your questions to a maximum of 2 per person, so we can take questions from as many of you as possible. Following the call, the IR team will be, of course, available to respond to any outstanding queries. As always, we will be using the Q&A functionality in Zoom and not the raise-hand function, -- and when submitting your questions, please share your name and the firm you represent. Okay. Let's get started. Ethan, over to you for the recap.

[Ethan Tandowsky, executive]

Thanks, Josh. And thanks, everyone, for being here. I'll first recap the past few months by the numbers, and then provide some additional voice over. To start, process volume landed at EUR 297.8 billion, up 46% year-on-year. Within this, digital volumes were up 51%, Unified Commerce volumes grew 30%, and our Platforms pillar grew at 55%.

Our net revenue was EUR 438 million, up 21%. Our growth rate would also have been 21% on a constant currency basis. Finally, we added 26 people to the team net in the first 3 months of the year. So now that we've gone through the numbers over the past few months, let me provide a bit more commentary.

Over the course of 2023, we shared updated financial objectives that more clearly specify our expectations for the coming 3 years. These reflect the growth potential in operating leverage inherent to our single platform and aim to shed light on how we're tracking against our long-term ambitions. As it pertains to net revenue, our expectation is to grow between the low 20s and high 20s percent on an annual basis up to and including 2026.

We further shared that we expected to be at the lower end of this guidance range in 2024. Thus far, our net revenue performance is consistent with this, and we continue to expect our annual growth for 2024 to be at the low end of that range.

To give some additional color, following the same trend as in the second half of 2023, North America was again our fastest-growing region thus far. Next, when you look at the recent process volume acceleration, there's a key driver we can point to, namely, it's that we continued growing with our existing customers. Our land-and-expand strategy remains core to our commercial approach, and over 80% of our growth came from our existing base once again. One proof point of this strategy was our volume growth with an existing digital customer, which greatly ramped up in H2 2023 and which we discussed at that time.

While this customer had a significant volume impact, we also saw acceleration with other large-volume enterprise businesses. Their collective expansion contributed to that 46% year-on-year volume increase. As we reiterated in H2, substantial wallet share growth with our customers undoubtedly drives value for our business. Of course, when we grow faster with our largest volume customers, a natural outcome may be periods in which processed volume outpaces net revenue. This dynamic gives us the opportunity to be a strategic enabler for enterprise businesses of varying sizes, while pricing for the outside's value and functionality we bring.

It's why we consciously manage on that revenue, rather than on take rate. And we don't manage on take rate because an enterprise partnerships absolute net revenue impact, and profitability are what's most important to us. Finally, I'll spend a moment on our global team. Our strategy remains unchanged, and we continue to expect to bring on a couple of hundred net new joiners over the course of 2024. As you know, as part of our long-term investment, we did a lot of hiring over the past 2 years.

It's important to remember that we are still annualizing the hires made in 2023. As a reference point, we ended March 2024 with 15% more employees than at this time last year. For that reason, we expect that the EBITDA margin should expand year-on-year on a full year basis, albeit it will be more limited than in the following years.

When we closed our significant 2-year investment period in H2 last year, we plan to continue to make strategic hiring investments, albeit at a much lower rate. And so far, this year, we prioritize bringing on senior leaders who will play an essential part in our hiring process for the rest of the year. Our hires thus far were more weighted towards commercial roles. While we've been focused on growing the commercial organization, I want to stress that it takes time to see new customer wins driven by our expanded team. These are investments we make for the long term.

To wrap up, we feel we're in a solid position 3 months into the year. We're confident that the products we're building with our expanded tech team are positioning us well in the industry. Combining this with our commercial team increasing in both size and Adyen experience, we believe our investments are on track to deliver growing value to both current and future customers.

[Josh Masser, executive]

Thank you for that commentary, Ethan. That was very helpful. We'll now transition to our Q&A segment. As always, we ask that you please submit your question with the name and firm you represent.

[Josh Masser, executive]

Thank you. The first question comes from James Goodman at Barclays.

[James Goodman, analyst]

Can you hear me now?

[Josh Masser, executive]

Yes.

[James Goodman, analyst]

Yes. So look, a couple of questions from me then, please. So firstly, just on the second quarter perhaps. How's that started? And if we think about the shape of the comps, I think you had 21% growth in Q1 last year, 16% in Q2. So is it logical to expect some sort of acceleration in the business in Q2? And then the second question, just around the take rate release. So you've made some helpful comments there already. Should we -- if we exclude Cash App, if we exclude the mix effect towards large enterprise, should we think about it as being roughly flat? Or are there underlying pricing changes to consider as well?

[Ethan Tandowsky, executive]

Yes, sure. Thanks. Maybe to start on Q2, I think the idea we had in doing these updates is to give insight into how the business is developing, right? And we've given a view on what we think for the year, for 2024. We think we'll be towards the low end of the guidance range we've given. And we feel we're confident that we're tracking towards that. So we'll continue to work with our teams and with our customers to grow their businesses and, of course, to grow ours. And we're confident that we can attain that annual growth rate that we've talked about previously. In terms of -- maybe, Josh, can you share...

[Josh Masser, executive]

Yes, take rate, excluding Cash App.

[Ethan Tandowsky, executive]

Yes. In terms of take rate, excluding Cash App, yes. So the question, I guess, comes down to, is it just mix? Or is there also a pricing impact? I want to be clear here, there is no structural change on the way that we price our contracts. It's not new that we are flexible with various sized enterprises. And in this period, we grew our volumes at a higher rate with the largest enterprises. So we haven't seen a structural change. We still see that we can bring premium value to the market. We still price for that premium value, and we think it's a great outcome that we're able to work with the biggest companies in the world.

[Josh Masser, executive]

Thank you, James. The next question is from Mohammed Moawalla from Goldman Sachs.

[Mohammed Moawalla, analyst]

Yes. Can you hear me?

[Josh Masser, executive]

Yes.

[Mohammed Moawalla, analyst]

Two from me. Just coming back on -- the take rate. I know you said you don't manage the business to the take rate. It's more of an output than an input. I know that this is sort of -- you're going to be reporting quarters kind of for the -- for the first time in a more consistent basis this year. Are there any sort of other factors outside of the enterprise kind of merchant effect you said from a seasonality standpoint or mix standpoint that we should be mindful of? And then I also noticed that I think you may have kind of recovered some volume share at eBay.

Could you confirm that and whether that had some impact as well? And then my second question was, you've obviously reiterated your midterm revenue outlook, which is to sort of accelerate net revenue growth. How should we sort of unpack that in terms of kind of volume and take rate.

And should it be fair to kind of assume that the take rate should still see that kind of erosion as the kind of existing customer base grows and share of wallet growth within that?

[Ethan Tandowsky, executive]

Yes. So I think starting with the question on take rate, it very much isn't a mix impact here. It's -- that we grew faster with the largest customers on our platform. And it's also that the -- the relatively smaller enterprise customers grew at a slightly slower growth rate than we saw in the second half. So both of those things are factors, but they're -- down to mix rather than a pricing impact. Then on eBay. eBay is one of those -- largest -- one of those large customers on our platform.

And we talked about last year how they looked at what payment methods they wanted to do with us, and what they wanted to do in-house. Those comps got easier in the first quarter of this year. So that's also why you see the total platform growth accelerating quite significantly from Q4, even as the -- excluding eBay growth continues to be really strong.

And then take rate erosion in the future. The way we build our business is on absolute net revenues. So all of our teams internally are focused on how do we help our customers with their top priorities, and how do we manage absolute net revenues for us as a business. So whether those volumes come from -- the biggest companies on our platform or -- the relatively smaller ones, they're incentivized equally. It's important that we make all of them successful and that we focus on our absolute net revenue growth, and that's how we've set up our organization throughout. So that's also why we actively manage on those absolute net revenue levels, and why it's hard for me to guide on how volumes would trend compared to those net revenues as it's not how we're internally set up.

[Josh Masser, executive]

Next question is from Justin Forsythe from UBS.

[Justin Forsythe, analyst]

Can you hear me?

[Josh Masser, executive]

Yes.

[Justin Forsythe, analyst]

So just a couple from me. I wanted to talk a little bit about the acceleration in digital TPV growth. So -- and that is on an -- ex that individual large merchant basis, which -- it also seemed accelerated, granted there was some FX impact, it seems, in there. You talked about acceleration with existing merchants, particularly large enterprises, which drove some of the pricing impacts that has discussed here. Can you talk a little bit more what is driving the expansion with these merchants? Is there a change you're going to -- and changing the way you're going to market with them, compared to where you were, say, pre-Q2 2023? Is there anything different you're doing on a pricing basis to entice them to come on to the platform? Or is it, again, just simply the same value prop and they're just expanding wallet share?

And I wanted to talk a little bit about the full-time higher dynamic contributing to revenues. So maybe you could highlight a little bit the sales FTE and account managers, a little bit more on the role of the account managers. Is there an understanding when you sign a contract that you'll be ramping to a certain wallet share over a, say, 4-year time period? Or do account managers play a pretty big role in facilitating the ramping of that volume over time?

[Ethan Tandowsky, executive]

Yes, sure. So first on the digital acceleration. It's not that we've made a structural change in the way we price for those customers. I think -- we've always been flexible, like I said, in how we structure price because we're focused on absolute net revenues, given the limited variable cost to those transactions. That's remained consistent. Of course, as you go, you need to meet your customers' priorities.

And as customers' priority shift, we also need to make sure that we're explaining what we can offer in terms of value to meet those priorities. So of course, you're making tweaks along the way in your commercial process. But in terms of structurally making a change in the way that we price those deals, we haven't made a change there.

We still think that we offer a premium proposition, and we price for that. I think it is really a strong proof point that these customers are willing to expand wallet share with us, hence bring more of their business on to the Adyen platform. So overall, I definitely see it as a positive. I think -- the pricing dynamics haven't changed structurally for us, and we'll continue to take the approach that we've taken consistently over the past years.

In terms of how the account managers work together with our customers, they play a really key role. First, and being the day-to-day contact and support with those customers to understand their day-to-day operational challenges, but also in being a strategic enabler for them in understanding what are the biggest priorities of those customers? And how could we, as a business, help them meet those priorities. So it's not that they lock in a 4-year plan. They have a good sense of how much business we're doing with any given customer at any time, and they have a good sense of what are the key priorities that we're going to work on together over the next 6 to 12 months and then they execute on that.

So -- of course, you have some type of long-term planning, and what direction you want to take the account. But in terms of making that really locked in, given how fast our customers' priorities can change, they focus on really how they can help them over the next 6 to 12 months, especially.

[Josh Masser, executive]

The next question is from Adam Wood from Morgan Stanley.

[Adam Wood, analyst]

Just really around -- you've seen a fair amount of volatility on the growth quarter-to-quarter over the last kind of 18 months, 2 years. Ethan, you're obviously, happy to reiterate that guide for the full year to be at the low end of the range. Could you just help us a little bit about what you're looking at to give you the confidence that, that's going to be the case? What are you seeing in the business that gives you that?

And then just kind of a follow-on, to the extent that's linked to the headcount that you've hired and brought on board and that becomes more and more productive as we go through the course of this year, and particularly at the end of the year. What's the experience been so far on that in terms of people getting productive in the results? And I guess what I'm asking in other words, is are you still confident that the scale of the business that you decided to change was a big limiting factor -- on the growth rate rather than it being something around market commoditization, competition or price?

[Ethan Tandowsky, executive]

Yes. Thanks, Adam. We just had a question on the role of the account management team, and they play a key role here as well. So we take a view on our various accounts on our customers, which share of wallet opportunities we have with them. And we then prioritize them over that 6- to 12-month period I talked through. That is progressing according to what we expected. So our growth thus far is in line with our expectation for the full year. And it gives us the confidence that we're on track to meet that low end of the guidance range that we previously discussed.

In terms of how new specialty sales team members are picking up, we feel good about that as well. They're tracking in a similar way to how we saw bringing salespeople on in the past. I think the biggest -- the biggest definer of how productive salespeople are, is typically how long they've been at Adyen. It takes quite some time to build pipeline. And then, of course, we need to close that pipeline and those accounts then need to ramp up, and that process can take a number of years as well. But the early signs are good that we are able to hire strong people into the team, and they are able to contribute at a really good level for us. So we are confident that we made the right decisions in going into that investment period, and that over time, we'll also see the business accelerate because of it.

[Josh Masser, executive]

Thanks, Adam. The next question is from Harshita Rawat of Bernstein.

[Harshita Rawat, analyst]

Ethan, can you give us some more color on the Cash App volume ramp? How much was in the fourth quarter run rate? And did you ramp up more volumes in the first quarter? And I'm assuming you're just doing kind of the [ carded ] portion of their more than $200 billion of B2B that's -- their reporting volume. And then just as a follow-up, a large peer of yours has had a management change last year. And what we're hearing now is that they're going back to some customers and having pricing conversations to bring profitability up. Is this something you're seeing already in your customer conversations?

[Ethan Tandowsky, executive]

Yes. So first on Cash App volumes. What we've previously communicated is that we had a bit of volume in Q3, but that they were basically fully ramped to what we expected in Q4. So we saw similar absolute volumes in the first quarter to what we saw then. Of course, the comparables change, so they can have a different impact on the relative growth rate, but on an absolute basis, we saw similar volumes. And then in terms of change in competitive dynamics, of course, you hear things anecdotally, but to say that it's materially impacting our numbers already or our business already -- wouldn't be fair for me to share. So we haven't seen a huge change in that dynamic thus far.

[Josh Masser, executive]

Thanks, Harshita. Next question is from Sandeep Deshpande from JP Morgan.

[Sandeep Deshpande, analyst]

Firstly, with your take rate having gone down because of the mix, do you need to grow your processed volume over the period of your guidance much more now like what you did this quarter? I mean, you had very strong process volume growth. But does this mean that you expect that sort of volume growth given the lower take rates that you're seeing historically, your take rates haven't gone up from lower levels?

And secondly, I mean -- not secondly -- or how do you believe that the take rate will go up because you're going to have a new product in the mix and that will take the take rate up or will stabilize the take rate? And then secondly, my question is regarding, the lower take rates give -- give the potential to break into potentially newer businesses and newer markets, which do require these lower take rates. And so, are you targeting new verticals associate, which require these lower take rates, maybe potentially groceries or low-cost businesses? -- And which are these verticals that you're targeting?

[Ethan Tandowsky, executive]

Yes, sure. So starting with what type of volumes do we need to drive the revenue growth that we anticipate. Like I've said on this call before, I think it's important to -- to understand that we really manage the business on absolute net revenues. So when we look at our portfolio of customers and where we have the opportunities to grow, we don't track it on a volumes basis. It could mean that some -- in some periods, the opportunities are with really high-volume opportunities.

And in other periods, it's with lower volume opportunities. The key metric that we are tracking our business on also that our commercial teams look at is on the net revenue side. So -- no, it doesn't mean that we need to have this big of a delta between process volume and net revenue to grow our net revenues at a substantial pace. -- that could even be periods where we grow volumes slower than net revenues. It really depends on which projects, which customers we focus on at what time. And then in terms of -- new verticals, and new markets that could be unlocked by a lower take rate, here, we really look at, is payment strategic for an industry. And I think over time, we've seen that payments has become more strategic for more industries, even breaking into things like everyday retail, we talked about the S Group in H2.

These are types of industries where we previously wouldn't have gone into because they didn't see a lot of strategic value in payments. We see that more of these industries are seeing strategic value in payments, and therefore, it is a conversation now worth having with them.

But ultimately, the take rate that we show is one big, blended average of all of the customers on our platform. So just because it changes because this period we grew with our largest existing customers. It doesn't mean that the average take rate of all of our customer base declined in that same way. It's really down to mix. And so it doesn't unlock anything new. It's more, we see more industries moving to seeing payments as a strategic enabler, and that opens up more industries for us.

[Josh Masser, executive]

Thank you. The next question is from Hannes Leitner from Jefferies.

[Hannes Leitner, analyst]

I got kind of a follow-up question on it. I mean you had over the last year announced a couple of wins in the financial sector, I would call it like Klarna, WorldRemit and the Cash App opportunity. Maybe you can talk a little bit about those kind of opportunities which seems to be a little bit away from the core typically retail, luxury or airlines or unified commercial business. So maybe you can talk about that -- what's in the long term. And then the second question would be, you called out local payment methods. Maybe you can just give us a little bit of a feeling of the split of the mix you are having between the key payment methods like when you think about the traditional Visa, Mastercard, maybe Amex, and then looking at the local payment methods and wallets and et cetera?

[Ethan Tandowsky, executive]

Yes. Sure. So first in the financial services sector. I think -- the fact that we're able to win in this sector, I think, shows how complex it is, and also how strategic payments are within that overall industry. That's what's allowed us to have success with those customers. So it's really them seeing payments as a strategically important part of the services they're offering. And I think that is a trend that has maybe changed over the last few years where it has become more important.

In terms of real impact on the business, we talked about the large digital customer and the acceleration we saw in Q4. For the rest, I think they follow a more -- common, ramp-up path where that ramp-up takes a number of years. It's through diligent work with our teams and theirs to win share of wallet, to prove our performance, and then to gain more of their business. So in that sense, I see it quite similar.

And then in terms of LPMs versus card mix, yes, card is still far and away the predominant mean of payments for our customers. You see small mix shifts, but nothing major, that's worth noting. I think the more interesting trend is that you see more local payment methods in the mix and that's adding more complexity for us to help solve -- for our customers, even in a market like U.S., where previously it was relatively straightforward, just a just a few card types that you needed to process, you still see more and more payment methods becoming relevant in a market like that, but also around the world. So I think it is more the -- the array of type of payment methods, then it's that fundamentally, the full mix shift has changed all that much.

[Josh Masser, executive]

Thanks Hannes. The next question comes from Fred Boulan from Bank of America.

[Frederic Boulan, analyst]

Yes, I mean, just a follow-up on the previous question around the phasing through the year. So I hear you on your kind of confidence to get to the guidance of low 20s for the year. However, as we look at last year, we've had a much tougher comp in -- Q3 and Q4. So if we continue at the current pace, we're not really there in terms of delivering on that guidance. So if you can be a bit more specific into which areas you expect to accelerate in the next couple of quarters to get there? Is it some specific -- I mean, within the mix, is it more around platform or unified commerce?

Is it some specific products that you've been launching -- which are ramping up faster, some industries, some geogs? So would it be good to understand a little bit where your confidence is coming from. So, I know the question has been asked already, but I'm trying from a different angle.

[Ethan Tandowsky, executive]

Yes. Thanks. It's hard to point at one area. I think the reason that we -- were building a growing business, our growing is scaling every -- our business is scaling every quarter, right? So when we look out at our growth projections, it's looking across our whole customer portfolio and seeing where the opportunity is. That opportunity appears strong for us this year, where we think, we can get to the low end of the guidance range. And then ultimately, we believe that a lot of the commercial investments we've made over the past years will also kick in and help us accelerate from there.

So it's not that I would point to one customer or even one geography, although, of course, North America is our fastest-growing geography this quarter. That I would say that's what's going to ultimately drive the acceleration. We see it relatively broad-based, and we feel confident also that because it is broad-based, that we will be able to deliver on it.

[Josh Masser, executive]

Thanks, Fred. The final question is from Pavan Daswani from Citi.

[Pavan Daswani, analyst]

Firstly, I have -- maybe if you could touch on the wallet share losses in Q2 last year and whether you have started to see some of those coming back. And if so, can you maybe give us a sense of what has really driven that based on the conversations that you've had? And I think the other questions really have been answered, but maybe just one more on the kind of adding on some of the questions on the building blocks of the accelerating growth. You gave us those building blocks at the Investor Day. I appreciate that it's just a quarter, but it seems to be tracking somewhat differently based on those building blocks that you gave us. So I don't know if -- is that just a quarterly impact? Or is that kind of a different -- different way of thinking about that?

[Ethan Tandowsky, executive]

Yes. So what we talked about in H1 was that we grew at a slower rate than we had grown previously within digital, especially in the U.S. And it's really hard to connect volumes one-on-one to what you would have won versus what you're winning now. You're in constant discussion with those businesses about where do they see Adyen can best support them? Where can we add value? And yes, we are able to grow with businesses like we previously called out. So also with the largest digital U.S. businesses, we are adding a lot of wallet share. We see that reflected not only in the growth of the volumes, but also in the fact that North America is the fastest-growing region in terms of net revenues.

So yes, I think we are winning there. It's difficult to connect it one-to-one, but we're happy with the progress that we've been able to make also with our commercial teams and showing that the biggest businesses in the world want to work with us and they see the value that we can bring to them.

Then in terms of the building blocks, I think the biggest thing that I would call out is that what we talked about in -- in November is that there are share of wallet gains in volumes, which are the biggest driver typically of our growth. At the same time, the more volumes we do with the customer, the lower their pricing goes, because we have little variable cost on those additional transactions. It grows absolute net revenues. And therefore, we incentivize that they bring more volume to us.

So those 2 numbers typically move in the same direction. If we are gaining more share of wallet in any given period, then probably there's also a bigger tiered pricing impact that's similar to what you see in the first quarter, and not similar in absolute terms, but in just relational terms. And so that's the biggest difference from what we shared then. And also, what will always be the driver of any difference from what we shared on those building blocks.

[Josh Masser, executive]

Thanks, Pavan. And thanks, everyone, for joining today. So that concludes the call. The IR team are, of course, on hand to answer any of the remaining questions, [e-mail]. So thanks, everyone, and have a great day.