Getty Images Holdings Inc

NYSE:GETY

Earnings Call Analysis

Getty Images Reports Growth Amidst Challenges

Getty Images saw a return to growth in Q2 2024 with revenue increasing 1.5% year-on-year to $229.1 million. Adjusted EBITDA was $68.8 million, down 5.4%, but margins remained healthy at 30%. The company anticipates full-year revenue between $924 million to $943 million, reflecting 0.9% to 2.9% growth, and adjusted EBITDA between $290 million to $294 million. Despite economic challenges, including impacts from the Hollywood strikes, Getty showcased resilience, driven by its strong subscription model with 52.9% of revenue from subscriptions. Investments in AI and strategic partnerships further bolster future outlooks.

Return to Growth: Q2 Highlights

In the second quarter of 2024, Getty Images successfully returned to growth, achieving revenues of $229.1 million, up 1.5% from the previous year on a reported basis. This reflects a 2.1% increase when adjusted for currency fluctuations. Despite this positive outcome, the company reported a decline in adjusted EBITDA, which fell 5.4% to $68.8 million, maintaining a solid EBITDA margin of 30%. Emphasizing their strategic approach, the company recognized challenges from softer demand in agency and production segments, particularly impacting video revenue. However, there was growth across all their brands, including Getty Images, iStock, and Unsplash, buoyed by increased paid downloads and consumer engagement with exclusive content.

Competitive Edge in a Changing Landscape

Getty Images credits its competitive edge to unique partnerships, deep expertise among its staff, and extensive archives. One notable achievement highlighted in this call was their role as the official photographic agency for the International Olympic Committee. The company captured over 5 million images during the Summer Olympics, demonstrating its capacity for large-scale, high-quality content production. This strategic positioning underlines Getty's commitment to providing in-depth storytelling capabilities to their clients, securing their value in a crowded market.

Embracing AI: A Future Growth Driver

The call featured a significant focus on generative AI, with Getty Images announcing advancements in their AI capabilities in collaboration with NVIDIA. They aim to provide high-quality, commercially safe AI services, which may become a meaningful revenue contributor over time, despite early indications suggesting limited current impact. The company is optimistic about the potential of generative AI to enhance customer engagement as it gains traction in commercial use. This innovation positions Getty to remain relevant and competitive by leveraging cutting-edge technology.

Financial Discipline and Outlook

Getty Images demonstrated strong financial discipline, achieving a free cash flow of $31.1 million, up from $27.9 million year-on-year. Their balance sheet showed $121.7 million in cash at the end of Q2 while maintaining a net leverage ratio of 4.2x, unchanged from previous quarters. The forecast for the remainder of 2024 includes updated revenue guidance between $924 million to $943 million, reflecting expected growth of 0.9% to 2.9% year-on-year. However, adjusted EBITDA is projected to decline slightly, accounting for 3.8% to 2.5% reduction compared to 2023. Despite these adjustments, the EBITDA margins are anticipated to exceed 31%, showcasing ongoing operational efficiency.

Navigating Agency Revenue Challenges

While optimism for the latter half of 2024 exists, challenges remain in the agency sector, which has been characterized by double-digit declines. Improvements are noted, yet the recovery is gradual. Getty sees opportunities for stabilization, particularly as economic conditions improve. As they look towards the second half of 2024, events like the Olympics and the upcoming U.S. political cycle are expected to positively influence their editorial performance, aligning well with historical year-on-year comparisons.

Focus on Subscription Services

Subscription services, now responsible for over 50% of revenues, have seen a strategic push to grow annual subscriptions across various platforms. The introduction of Unsplash+ as a paid service and enhancements in iStock's subscription offerings are examples of this commitment. The emphasis on subscription growth is aimed at improving average revenue per user (ARPU) and lifetime value, underscoring a strong foundational change within the company. Although challenges with subscriber growth rates were noted, retention rates remain stable, suggesting the firm is building a solid customer base.

Conclusion: A Balanced Perspective

In conclusion, while Getty Images is navigating a complex environment of industry challenges and economic uncertainties, its return to growth, commitment to AI advancements, and strategic focus on subscription revenues showcase a balanced approach towards fostering resilience. Their proactive financial management, coupled with a strong operational performance, positions them well for the years ahead. Investors should consider both the current growth trajectory and the inherent challenges the company faces as they move forward.

Earnings Call Transcript 2024-Q2

[Operator]

Good morning, and welcome to Getty Images Second Quarter 2024 Earnings Conference Call. Today's call is being recorded. We have allocated 1 hour for prepared remarks and Q&A. At this time, I would like to turn the conference over to Steven Kanner, Vice President of Investor Relations and Treasury at Getty Images. Thank you. You may begin.

[Steven Kanner, executive]

Good afternoon, and welcome to the Getty Images Second Quarter 2024 Earnings Call. Joining me on today's call are Craig Peters, Chief Executive Officer; and Jen Leyden, Chief Financial Officer.

Before we begin, we would like to remind you that this call will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to various risks, uncertainties and assumptions which could cause our actual results to differ materially from these statements. These risks, uncertainties and assumptions are highlighted in the forward-looking statements section of Friday's press release and in our filings with the SEC.

Linked to these filings and Friday's press release can be found on our Investor Relations website at investors.gettyimages.com.

During our call today, we will also reference certain non-GAAP financial information, including adjusted EBITDA, adjusted EBITDA margin, adjusted EBITDA less CapEx and free cash flow. We use non-GAAP measures in some of our financial discussions as we believe we represent our operational performance and underlying results of our business. Reconciliations of GAAP to non-GAAP measures as well as the description, limitations and rationale for using each measure can be found in our filings with the SEC.

After our prepared remarks, we'll open the call to your questions. With that, I will hand the call over to our Chief Executive Officer, Craig Peters.

[Craig Peters, executive]

Thanks, Steven, and thank you to everyone for joining Getty Images Second Quarter Earnings Call. I will touch on our performance and progress at a high level before Jen takes you through the full second quarter financial results.

I am pleased to report, as expected, we returned to growth in the second quarter with revenue of $229.1 million, representing a year-on-year increase of 1.5% on a reported basis and 2.1% on a currency-neutral basis. Adjusted EBITDA came in at $68.8 million for the quarter, down 5.4% on a reported basis and 4.7% currency neutral, but continuing to represent a healthy EBITDA margin of 30%.

We continue to see some softness from our agency and production customers, impacting both creative and editorial and most notably, our video revenues. However, we achieved growth across each of our Getty Images, iStock and Unsplash brands, and we continue to see strong utilization of our offerings reflected by growth in paid downloads, with consumption centered on our exclusive creative and editorial content.

It would not be an earnings call if the CEO did not speak to our embrace of AI but I want to start by grounding us in what really sets Getty images apart. Our partnerships and unique access, our deep expertise embedded across our staff and exclusive contributors, our comprehensive coverage and archive, our best-in-class search and our deep customer relationships.

I was extremely fortunate to spend last week in Paris and observe how this uniqueness is demonstrated at an event like the Summer Olympics. We've been the official photographic agency of the International Olympic Committee for more than 25 years. Our experienced team of more than 140 individuals captured every moment across more than 70 sports for both men's and women's competitions. We captured the grandeur of the host city and the celebrities in dignitaries performing and in attendance. We captured the action from every angle, including from the air and below the water.

All told, we shot and edited more than 5 million images over the course of the games, and we delivered this content to our customers with unmatched speed. Our archive allowed customers to tell deeper stories about Paris, and tie the Paris Games and its athletes to the rightful place in history.

Our commercial team was also on the ground, delivering best-in-class service to the International Olympic Committee and its family of partners and sponsors, including NBC Universal Comcast, Coca-Cola, Procter & Gamble, Visa, Toyota, AB InBev and Samsung Electronics to name a few. And we did all of this while covering the world beyond Paris, global elections and conflicts, climate events, the latest concert performances, movie premieres and major sporting events such as Formula One, where we're also their official photographic partner.

If you remember, in April, we announced the acquisition of Motorsport Images to deepen our footprint within the sport. And I'm pleased to report we added more than 300,000 images to our archive and worked closely to support new commercial partners such as McLaren Racing and Aston Martin.

I am proud of the scale and scope of what our team accomplished. I am proud of the level of professionalism displayed. I'm reminded of what truly sets Getty Images apart and of the durable value we conveyed to our customers.

On the technology front, we continue to innovate to bring true commercially safe, high-quality, generative AI services to our customers. We launched an updated model of our commercially safe generative AI services and tools in partnership with NVIDIA that brings lightning-fast speeds and higher-quality visuals, including improved detail for high resolution 4K outputs.

We rolled out capabilities allowing customers to use AI across our preshot-creative library, enabling customers to modify both generative AI images and existing pre-shot creative images. We announced the option for customers to fine-tune the commercially safe foundational model using their own proprietary content.

We announced our partnership with Picsart to offer a custom, commercially-safe model to their millions of creators, marketers and small business customers. We announced the renewal of our long-standing Canva relationship, providing Canva's customers with access to millions of Getty Images' award within creative image and video assets and agreement to collaborate to develop responsibly trained, commercially safe generative AI for their platform.

I am proud of the progress we're making on this front. I am proud of the quality of our offerings and the legality and integrity of how they are trained. And by the company we keep I am reminded of the truly unique capabilities of Getty Images.

I will end my remarks by saying that I'm excited to build on our momentum over the second half of 2024. I will now turn it over to Jen to take you through the more detailed financials.

[Jennifer Leyden, executive]

As Craig mentioned, our business returned to top line growth in Q2. With headwinds turning to tailwind, our editorial business is back to the growth we have historically seen after 4 consecutive quarters of decline due to Hollywood strike impact. Our subscription business continues to expand now up to 52.9% of total revenue, and our key performance metrics continue to be healthy.

Positive growth momentum across our business in spite of a still challenged agency business and a slow ramp-up of post Hollywood strike activity from our media and production customers provides a solid foundation from which we continue to execute towards a strong second half of the year.

Let's begin by highlighting some of our KPIs, which are reported on the trailing 12-month basis our LTM period ended June 30, 2024, with comparison to the LTM period ended June 30, 2023. Total purchasing customers were 740,000, down from 830,000 in the comparable LTM period. The decrease is related to lower volumes of a la carte transactions which reflects both our continued shift and committed annual subscriptions and a still pressured agency business, which consumes nearly entirely on an a la carte basis.

Importantly, we continue to see the benefit of higher lifetime customer value as we shift into more committed solutions. With the total annual revenue per purchasing customer growing 10.7% to 1,232 from 1,113 in the comparable LTM period. We added 100,000 active annual subscribers to reach 282,000, representing growth of 55% over the corresponding 2023 LTM period.

This metric has grown north of 50% in each of the last 7 quarters. This growth was fueled by our e-commerce offerings, including our iStock annual and our Unsplash+ subscription. With the majority of this growth coming from customers' brand move to Getty Images. Out of the 282,000 annual subscribers, over 60% were first-time purchasing customers.

In addition, we continue to expand our geographic reach with over 96,000 new subscribers from across our targeted growth markets in LatAm, APAC and in EMEA. Our annual subscriber revenue retention rate was 89.4% compared to 98.5% in the comparable LTM period but held relatively steady to 90% reported for the LTM Q1 '24 period. The year-on-year LTM decline was driven by the same factors that have impacted this metric over the past several quarters include subscriber count growth and our lower retention, smaller e-commerce subscribers.

On Hollywood strike impacted reduction in incremental a la carte subscriber revenue from some of our media broadcast and production customers and a decline related to onetime project spend in the prior period from certain corporate customers.

On a sequential basis, the impact from some of these items does appear to be stabilizing, and our subscription revenue renewal rates remain very healthy averaging in the 90% range. Paid download [indiscernible] volume was up 0.9% to 95 million in ever compelling data point demonstrating the continued demand for high-quality, differentiated commercially safe content. Our video attachment rate rose to 15.6% from 13.5% in the LTM Q2 2023 period, another quarter of year-on-year growth.

Turning to our financial performance. Revenue was $229.1 million, an increase of 1.5% and 2.1% on a currency-neutral basis. Included in these results are certain impacts of the timing of revenue recognition, which reduced year-on-year growth by 100 basis points.

Annual subscription revenue was 52.9% of total revenue, up from 51.1% in Q2 2023. This is our seventh consecutive quarter with subscription revenue comprising north of 50% of our total revenue. In total, subscription revenue increased 5.2% on a reported basis and 5.7% currency neutral, driven primarily by growth across our e-commerce subscription offering.

Editorial revenue was $83.6 million, an increase of 4.1% year-on-year and 4.6% on a currency-neutral basis. We are seeing a strong rebound in editorial with the business delivering its first quarter of growth since the Hollywood strikes began impacting our financial performance in Q2 of 2023.

We saw growth across sports, news and entertainment with the largest gain in sport, which was in double-digit year-on-year growth. We are seeing lift from our impressive coverage of major events such as the European soccer season and the lead up to the UEFA Euro championship as well as our coverage of the U.S. and U.K. election cycle.

It is great to see our editorial business back in growth, and we are excited to continue this momentum into the second half of the year.

Created revenue was $137.9 million, down 2.4% year-on-year and 1.8% on a currency neutral basis. Creative performance continues to reflect the pressures in the agency business, which was down double digit, due primarily to decline at the smaller independent agencies. As we mentioned earlier, we are seeing a lag in recovery on the production side of things, which is also impacting creative results.

Created annual subscription revenue continues to be in growth at 5.7% year-on-year and 6.2% on a currency-neutral basis. Our customer acquisition efforts continued to drive growth in our iStock annual subscription, which grew 19% on both a reported and currency-neutral basis, marking the 12th consecutive quarter of double-digit growth.

In addition, our Unsplash+ subscription, the first paid subscription for Unsplash, delivered another quarter with triple-digit growth. As Craig mentioned, iStock and Unsplash largely e-commerce sites continue to grow. These sites on a combined basis represent roughly 20% of our revenue with over 50% sitting in annual subscription.

Across our major geographies, on a currency-neutral basis, we saw year-on-year increase of 1.7% in the Americas, 2.4% in EMEA and 3% in APAC. All of our major geographic regions were in growth, fantastic to see. Revenue less our cost of revenue as a percentage of revenue remained consistently strong at 72.5% in Q2, up from 71.9% in Q2 of 2023.

Total SG&A expense was $101.2 million, down from $101.5 million in the prior year. As a percentage of revenue, our expense rate was 44.2%, down from 45% last year. The lower expense rate was driven primarily by the increase in revenue and lower stock-based compensation in the quarter.

Excluding stock-based compensation, SG&A rose to $97.2 million in the quarter or 42.4% of revenue up from $89.6 million or 39.7% of revenue in Q2 2023. The increase in spend reflects our planned reinvestment in the business, primarily across staffing and marketing, in addition to higher commissions tied to revenue delivery and the inclusion of Motorsport Imaging operating costs.

This quarter also included some elevated severance costs as we continue to optimize our resource allocation. These costs should be offset by savings in the balance of the year and higher net annualized savings going forward.

Adjusted EBITDA was $68.8 million, down 5.4% year-over-year and 4.7% on a currency-neutral basis. Adjusted EBITDA margin was 30%, down from 32.2% in Q2 of 2023. CapEx was $15.4 million in Q2, up $1.5 million year-over-year. CapEx as a percentage of revenue was 6.7% compared to 6.2% in the prior year period and well within our expected range of 5% to 7% of revenue. The year-on-year increase is largely tied to timing within the year.

Free cash flow was $31.1 million, up from $27.9 million in Q2 of 2023. The increase in free cash flow reflects working capital changes related to the timing of receivables and payables. Free cash flow is stated net of tax interest expense of $26 million and cash taxes paid of $12.8 million in the second quarter.

We finished the quarter with $121.7 million of balance sheet cash, down $12.5 million from Q1 2024 and up $0.4 million from Q2 2023. This includes $32.6 million in voluntary debt repayments in the second quarter of 2024. As of June 30, we had total debt outstanding of $1.35 billion, which includes $300 million of 9.75% senior notes, USD 601.8 million term loans with an applicable interest rate of 9.94%, $448.5 million term loan, converted using exchange rates as of June 30, 2024, with an applicable rate of 8.69%. We also have a $150 million revolver that remains undrawn.

Our net leverage was 4.2x at the end of Q2. unchanged from both Q1 and year-end 2023. We remain committed to utilizing our cash flow to further deleverage the balance sheet, and we will continue to proactively explore opportunities to refinance our debt.

Based on the foreign exchange rates and applicable interest rates on our debt balance as of June 30, our 2024 cash interest expense is estimated to be $131 million. Of course, our actual annual interest expense remains subject to changes in the interest rate environment, which we outlined in more detail within our SEC filings.

In summary, it is good to see our business back in growth, with healthy underlying key metrics. We remain physically disciplined, we continue to invest in this business, and we look forward to building on our Q2 momentum.

Now turning to our outlook for the full year 2024. Taking into consideration the estimated impact of the stronger U.S. dollar and assuming current FX rates hold we are updating our reported revenue guidance range to $924 million to $943 million, representing year-on-year growth of 0.9% to 2.9%.

On a currency-neutral basis, this represents growth of 1% to 3%, which remains unchanged from our prior guidance. We now expect adjusted EBITDA of $290 million to $294 million, which translates to a year-on-year decrease of 3.8% to 2.5% or 3.6% to 2.3% currency neutral. The update to our adjusted EBITDA outlook reflects a $2 million impact on current borrowing currency pressure approximately $2 million of integration-related expenses that are more onetime in nature and some higher-than-expected employee health insurance costs.

Please note the estimated FX impact include an assumption that FX rates remain consistent with those as of August 1, 2024, with the euro at 1.08 and then GBP at 1.29 for the remainder of the year. Despite these unplanned impacts, our operating efficiency remains strong, with adjusted EBITDA margins expected to be north of 31%.

With positive momentum building, we remain optimistic for our full-year return to growth while maintaining the fiscal discipline that has long been embedded in our business. With that, operator, please open the call for questions.

[Operator]

[Operator Instructions]. We'll take our first question from Cory Carpenter with JPMorgan.

[Cory Carpenter, analyst]

Craig, one for you and one for Jen. Maybe for you, Craig, just on generative AI. You rolled out a lot this quarter, made a lot of progress. Hoping you could talk about the consumer engagement you're seeing? And then also, I know it's still early, but your thought -- latest thoughts on the potential monetization effect over time.

And Jen, for you, just could you touch more on the drivers of reacceleration in the second half of the year and the assumptions you're making in particular around the agency channel?

[Craig Peters, executive]

Thanks for the question, Cory. On the GenAI front, we continue to see really positive feedback from our customers across each and every segment of the business. And that's really due to the quality of the model, services that we're providing, but also the truly commercially safe nature of how these are built and what these can do. It's still early days in the adoption curve, though within the commercial sector. And so it's not material to the business.

We expect, over time, it can be a meaningful contributor to the revenues of the business, but it's still early days. And fairly limited contribution to the business at this point, but it is on a growth trajectory. And as that becomes more material, it will be something we'll probably report back to. Jen?

[Jennifer Leyden, executive]

Yes. And on guidance and just as we noted acceleration into the second half. So there's a few things there for top line performance. One, as we mentioned, we're still seeing certainly through the first half, Q2, some continued lag on that production side of things recovery. So a bit of continuing improvement there.

We have seen those declines start to taper off, but largely still a slower recovery than we anticipated. So a bit of pickup there. Agency side of things, we're not necessarily expecting any material changes there, but again, slow gradual improvement to those double-digit declines that we're seeing.

The other big piece of this, which we've spent some time talking about before is the editorial side of our business, there's a few things [indiscernible] there. One, obviously, as we move into the second half of the year, we've got a really favorable year-on-year comp with the strike impact starting to impact us largely in Q3 and the second half of last year. So we've got a built-in favorable comp there.

And then our editorial event calendar largely stacked in the second half of the year. So that's been a big events like the Olympics and the U.S. political cycle, both of those shaping up to be pretty healthy size event for us. So those are the primary drivers of that top line performance in the second half.

[Operator]

Our next question comes from Ronald Josey with Citi.

[Ronald Josey, analyst]

I wanted to double down a little bit more and understand on the subscription side, Craig and Jen and specifically, clearly over 50% of revenue for the past 4 quarters, that's a good thing here. I want to understand about the drivers. So you mentioned iStock, Unsplash now 20% of revenue, 50% of that from subscribers. Just tell us more about what you're doing to drive that subscription from iStock or, call it, subscription benefit from iStock and Unsplash and also the strength in iStock and Unsplash.

And then back to the subscription side, growth did decel here in 2Q from a revenue -- from an annual active subscriber perspective. Can you provide any insights on the decel and growth? And then from a retention rate, it looks like retention rate has been relatively steady. Should we assume this is the right rate going forward here?

[Craig Peters, executive]

Great. Thanks, Ron. And Jen, if you -- I'll take a stab at this upfront and then Jen can fill in on anything that I might have missed. In terms of the kind of Unsplash and iStock side of things, we've been making a concerted effort over the last really 2 years to drive more annual subscriptions across those products. It results in higher ARPU. It results in ultimately higher lifetime values. And we think we deliver more value to our customers through those offerings and become more embedded in their day-to-day use and workflows. So we think it's a good thing for the customer. I think it's a good thing for Getty Images overall.

The way we've been doing that, obviously, on Unsplash, we introduced a paid subscription, an Unsplash+ that had not sat there before. And it brings new value to those customers. It brings indemnification. It brings higher end content in there that is fully released content. So ultimately, it's providing additional value to the Unsplash universe.

On iStock, we've introduced more SKUs within the paid -- sorry, within the subscription product side of things. And we've been increasing the use of free trials against that. I'd say it's been largely positive. There is a slightly lower retention coming out of the free trial. But it's been one that we're getting people to try the product that are largely new to the iStock platform, as Jen mentioned. And we think that's a good thing, and it's been largely net positive.

We're obviously going through a test cycle to continue to optimize that by [ geo ] and traffic source. But that's been a driver behind that in addition to offering lower-end annual subscriptions like 10 downloads per month. That has led to great growth across those 2 platforms in terms of their annual subscription revenues and ultimately, as a percentage of the overall business, those do [indiscernible] mentioned on previous calls, they do with lower net retention.

Obviously, we're dealing with small businesses and freelancers and those have higher degrees of churn in and out of products. And so that's been impacting that retention rate that you referenced, which has kind of come down a bit. But again, I still think it's a net trade positive to the business.

And so I think on a go-forward basis, yes, you should expect to probably see revenue retention rates for subscribers to kind of maintain in that kind of 90% range. And we'll continue to test and learn and optimize. But again, I go back that we had growth across Getty Images, growth across iStock and growth across Unsplash in the quarter. And I think the annual subscription component of that was a big driver to ultimately achieving growth across each of those brands. Jen, anything to add?

[Jennifer Leyden, executive]

Yes. I think the only thing I'd add is, Ron, you asked specifically, I think if that 89%, 90% retention rate is sort of the go forward. I think probably as we cycle through this year, it will hover somewhere around there. And then start to ramp back up to low mid-90s over time. And one of the things that we are seeing when we've touched on here, one of the other drivers of that retention rate is we're seeing a little bit of contraction in spend from these subscribers outside of their subscription, and that is very much a Hollywood strike impact.

So if you go back to last year, pre-Hollywood strike, this number was in those low to mid-90s. So we're starting to see that consumption level that a la carte spend outside of subscription start to pick back up. Again, we're far from full recovery on that, but that's one of the drivers of this that I think slowly over time, we'll start to see that come back a bit.

[Ronald Josey, analyst]

Super helpful on both. Could you -- and one quick follow-up just talking on the writer strike and recovery we still have -- I think we're still recovering. Would you say we're beyond the heavy lifting, so to speak, and now it's a matter of time? Or would you have expected the recovery to be faster or slower? Any thoughts there would be helpful.

[Craig Peters, executive]

Yes, Ron, I think we're beyond the heavy lifting, but we're just in a gradual reramp over time. And -- so we're hopeful that we'll continue to see that over the second half and into 2025, it's one where that will impact all of our product lines. So it's not just an editorial item. It's an editorial plus creative. In fact, a lot of the content that is consumed into production is creative. So yes, we expect that we'll see that.

Clearly, following the media sector, it's one where that's been a bit more gradual by all reports, but all expectations are that by 2025, we should probably be back to where we were -- but yes, we're kind of past the heavy lifting side of things and should be in a situation where it's just a gradual return over time. And again, we've got deep embedded relationships within that community and those customer space, and are in tight conversations with them. So I think that expectation is one that's grounded in good, solid customer communication and feedback.

[Jennifer Leyden, executive]

I'd just add there, just to give some numbers. If we look at specifically kind of that production side of things, when we were in the heart of strike impact last year, we saw that industry down double digits. As we move into this first half of the year is still in decline, but now sort of in that lower single-digit range.

So if you look at those numbers, we've gone from double-digit declines down to single-digit decline. So seeing some improvement. But as Craig noted, we expect that recovery to continue on a bit longer.

[Operator]

Our next question comes from Mark Zgutowicz with Benchmark.

[Mark Zgutowicz, analyst]

A couple for me on -- well, one premium access. Just curious how that performed in the quarter and your expectations for the e-com product? Basically, I think it's roughly a 20% base today, so just growth in the second half?

And then also curious, I might have missed it, but I was curious what drove the big quarter-over-quarter growth within the other segment.

[Craig Peters, executive]

Thanks, Mark. On PA, premium access is our largest subscription offering. It's our primary subscription offering. It includes a lot of our really premium content across editorial and creative and video and stills, can bring our archive into play.

We continue to see really strong performance in that product, not just in take-up of new customers, but more importantly, on the retention side of things and the utilization side of things. So it's a really strong product, and we haven't really seen any moderation in its performance at any point in the last couple of years. It just -- it's really about building the strength of that deep customer embedded workflows and utilization. And that's kind of what we're bringing to the e-commerce side of things through those subscriptions on iStock and Unsplash.

With respect to the performance going forward on iStock and Unsplash, we continue to expect them to be in growth. These are platforms that are, again, really offering a differentiated content offering relative to competition. And it's one that we believe fundamentally resonates with our customers.

We see them consuming that content relative to nonexclusive or other sources at a much higher level. And it's one that we think that's a durable point of differentiation, and we believe based off of paid download metrics, revenue metrics, customer metrics that we're taking share within those spaces through those platforms, given their unique positioning and fundamentally, the content that underpins that and we expect that to continue.

With respect to other, that includes our media manager offering and music offering, but also some data licensing. And we did some small data licensing deals that are consistent with our view about really -- how we bring our content into the data licensing market or if we burn our content in the data licensing market, which is really staying away from onetime kind of perpetual licenses and trying to do it more in a partnership model.

So there was some slight data licensing that's consistent with that framework in Q2 off of a very small base historically. So that's what drives that in the quarter. Jen, anything to add there?

[Jennifer Leyden, executive]

No, I think, Craig, you touched on it. There are some other smaller individually immaterial contributors there are prints business or music business, both of those also in growth. But again, these are fairly small members as is that other grouping overall.

[Mark Zgutowicz, analyst]

That's helpful. And just on the license -- the data licensing side, is that how would you characterize that growth as more onetime in nature versus carry forward over the next 12 months? Just maybe if you could frame that, Craig. And one last one for me just in terms of political and the Olympics, if you could maybe quantify that your expected contribution relative to the last cycle, that would be helpful.

[Craig Peters, executive]

Yes. Thanks, Mark. It should be -- there's a bit of accounting with [ 606 ] and revenue recognition that makes that a little bit of a pull forward on some of the data licensing. But these are kind of within the model that we've always stressed, which is kind of more recurring in nature, kind of more partnership in nature.

So I would see some level of lumpiness just due to the different recognition aspects relative to kind of linear time-based recognition. But for the most part, we're trying to build recurring durable revenue streams over time. That is our focus as a leadership team and as a business and how we're entering this.

So probably a little bit of lumpiness. But ultimately, you can think about it as something that we're building relationships and revenue that we believe will be recurring over time, but how they're recognized might vary a little bit.

And as for the editorial calendar in terms of the elections and the Olympics and [ euros ]. We expected that to be slightly lower than the historic contribution on a 4-year cycle -- presidential, so 2020 versus '24. We're probably closer to [ 10 million to 12 million ] in the previous cycle, largely driven by the political side of things. And we expected this year to be around [ 8 million to 10 million ] and again, largely driven by a differential on the political side of things. We'll see how that plays out.

We believe that, that might be a conservative point of view given how the election is now shaping up in the U.S. And I can tell you, having come out of Paris and sat with a lot of our commercial partners in Paris, there's a lot of activity that is flowing out of that. So hopeful that there might be some upside relative to what we said in our initial guidance within.

But I think you can think about it in that [ 8 million to 10 million ] range. We're certainly seeing consumption of that content out of that premium access subscription offering. And it just speaks to, again, the quality of the content coverage that, that team, our team, the Getty Images team pull together in Paris, the speed, the quality, the depth, the breadth, the innovation around how we're covering games.

I think some of the new content and new content types we were producing were just fantastic and customers really reacted to them well.

[Jennifer Leyden, executive]

And one thing I'd add there, specifically on the political side, that incremental revenue for us, that will be a lift to both creative and editorial. So historically, when we look back at political spend, it's roughly 50-50 in terms of how it hits creative editorial, sometimes it skews even higher on the creative side of things. So that political impact, while we talk about it in the editorial side of the business, that impacts our creative revenue as well.

[Operator]

Our next question comes from Tim Nollen with Macquarie.

[Tim Nollen, analyst]

I'd like to come back to the agencies topic, please. The agencies themselves have had kind of mixed-ish results. Just wondering what gives you the optimism going into the second half of the year? I mean I think they've been stable overall. But I'm talking to larger agencies, what we cover on the public side, maybe you're focused more on the smaller agencies. So just wondering where the optimism comes from there?

And then secondly and relatedly, I think last time we were talking a bit about agencies adopting more of the generative AI tools. And I'm wondering if there's any indication yet that they are shifting away from an a la carte to more of a subscription payment model as they adopt these tools.

[Craig Peters, executive]

Thanks, Tim. On the agency front, I would say that what we're really seeing is a stabilization within that portion of the business. This is, again, a segment where we're seeing double-digit declines, and we're seeing that start to moderate as we see some of the economic certainty start to improve, as we see some of the sectors of the economy like the tech sector kind of bring back some spend and investment that flows through the agencies.

So it's not anything that we're expecting in terms of a heroic change as Jen referenced in her remarks. But it is one that we are seeing the trends of normalization. That's kind of led out through the large network agencies, and we're seeing early signs of that in the agencies.

So we don't see a major shift to AI or subscription within those agencies. And that's largely, again, because of how they work with their clients and what that means in terms of how they need to bill back with their clients. They still need to build back on a per project basis. So we're not seeing a shift into subscription. We're not really seeing any major shift to AI there in terms of end project needs. But we are seeing experimentation. And that is certainly something that we see in there. And in many cases, that's in partnership with Getty Images.

[Operator]

And this will conclude our Q&A session as well as our conference call. Thank you all for your participation, and you may disconnect at any time.

[Jennifer Leyden, executive]

Thank you.