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Ladies and gentlemen, welcome to the Q3 2024 Results Conference Call. I am Elo, the chorus call operator [Operator Instructions]. The conference is being recorded. [Operator Instructions].
The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Filip Lindvall, Vice President, Group Strategy and Investor Relations. Please go ahead.
Good afternoon, everyone, and welcome to Scout24 Third Quarter and 9 Months 2024 Earnings Call. My name is Filip Lindvall, and I'm Vice President, Group Strategy and Investor Relations at Scout24.
With me on the call today are Tobias Hartmann, our Chief Executive Officer; and Dirk Schmelzer, our Chief Financial Officer. Tobi will start the presentation with an overview of our quarterly performance, and Dirk will dive deeper into our 9 months and third quarter 2024 results.
Let me just remind you that we have now completed the first full year since the consolidation of Sprengnetter on July 1, 2023. This means there is no longer any inorganic revenue contribution from Sprengnetter.
I also want to remind you that starting with our third quarter results today, we are now reporting in line with our new segment structure, which we announced during the last earnings call. As always, we will conclude the call with a Q&A session. You can find today's presentation on our website under Financial Reports & Presentations.
This session will be recorded and a replay will be made available as quickly as possible after the event. Please take note of the disclaimer on Page 2. Tobi, now over to you.
Thank you, Filip, and welcome, everyone. Let's turn to Page 3 of our presentation and review the key highlights.
Revenue growth was 8.5% in the third quarter of 2024, contributing to an overall increase of 11.4% for the first 9 months of the year. Growth was driven by continued strong performance in our core agent membership business and a very strong momentum in our private subscription segment.
Our membership business grew revenue by 9.0% during the quarter, driven by a combination of customer growth and product upgrades. We continue to win new professional customers, achieving 2.5% growth in our membership business during Q3. This marks an acceleration compared to the second quarter. The number of customers amounted to 24,728 during the quarter. By the end of September, we have grown the base even further, now approaching 25,000 customers.
Our interconnected product portfolio and the strength of the ImmoScout24 platform continue to provide unmatched value to agents in this increasingly complex real estate market. Our private subscription business also remained a key growth driver in the third quarter with 27.6% growth. We continue to add subscribers at an impressive rate growing 24.7% in the quarter and reaching an average of 460,000. Growth was based on continued strength across the product portfolio. At the end of September, our customer base has surpassed 470,000, a new all-time high.
We are very pleased that our newly formed business unit, transaction enablement, grew 2.9%. This was driven by strong performance of our data and valuation business, CRM software as well as ESG products. Demand for seller leads stabilized, while demand for mortgage leads remains soft. Our operating leverage accelerated in the quarter with 16.1% growth and 4.1 percentage points margin expansion. These improvements are due to continued focus on efficiency gains and the successful execution of our interconnectivity strategy, which is improving product usage. Adjusted EPS rose by 16.0% to EUR 0.75 during the reporting period.
Turning to financial guidance for 2024. Based on the strong business performance in the first 9 months of 2024, we are very pleased to narrow the current guidance to the upper end, both for revenue growth and OO EBITDA margin. Based on this guidance update, we are well on track to deliver our fourth consecutive year of double-digit revenue growth. This is a track record we want to continue building on as we move into 2025.
Before we continue with the quarterly numbers, let me provide you with a quick update on the German real estate market. The real estate market for residential sales transactions is in recovery mode. Interest to acquire properties is increasing. Nationwide contact requests on ImmoScout24 increased by 9% in September compared to August. In Germany's major metropolitan areas, they rose by 28% year-on-year. However, transactional volumes remain lower than historical levels as buyer affordability is still down compared to the low interest rate environment.
As inflation is starting to come down and the ECB has started to lower interest rates, there is reason to be optimistic that the residential sales market will continue to gradually recover as we move into 2025.
For our customers, active in the commercial developer or new homebuilding space, the market remains more challenging. There are also reasons to believe that those markets will benefit from lower inflation and interest rates, but it is too early to call out the recovery here.
Overall, the current market environment is favorable for Scout24. The decline of the gray market, higher complexity of selling real estate and increased importance of buyer leads are trends that will continue to persist as we enter 2025. With our unmatched product portfolio to tackle this new market environment and complexity, we are confident to continue our growth path.
Let's turn to Page 4 for a brief summary of our key third quarter metrics. Revenue for the quarter reached EUR 144.0 million, reflecting an 8.5% growth year-on-year. Ordinary operating EBITDA came in strong at EUR 90.7 million, an increase of 16.1% year-on-year, representing a margin of 62.9%.
In the Professional segment, subscription revenues rose by 9.0% to EUR 74.5 million due to continued strong growth with residential agents. In the Private segment, subscription revenue continued to perform exceptionally well with a 27.6% increase, building on the already strong performance from the second quarter. Subscriber growth reached 24.7%.
Turning to Page 5. Let me now elaborate on our 9-month results. Group revenue reached EUR 419.6 million, reflecting an 11.4% increase. The ordinary operating EBITDA of the group came in at EUR 257.1 million, up 14.5%, representing a margin of 61.3%. With these results as a basis entering the fourth quarter, we are well on track to achieve the upper end of our guidance.
In the Professional segment, subscription revenues showed healthy growth of 9.5%, reaching EUR 219.7 million. This was driven by the strong performance of our core membership products throughout all 3 quarters of the year.
In the Private segment, subscription revenues grew by an impressive 24.8% year-on-year, totaling EUR 65.8 million. As I commented before, this growth is driven by broad-based strength across the product portfolio.
Let me wrap up by putting our strong results into a broader context of our strategic framework. We are well on track to deliver a strong 2024, which marks the first year on the back of the Capital Markets Day we had in February, where we outlined our updated strategy and financial targets.
With our narrowed guidance towards the upper end, we are off to a great start executing on our strategy and targets. Our strong financial results are an outcome of our interconnectivity strategy starting to bear fruit. Let me highlight just a couple of examples to make the point.
At the Capital Markets Day, we said we were confident that our agent membership product will continue to see high demand based on our new level of interconnected products we provide in the new memberships. Agents now consume much more of the ImmoScout24 product universe than just the listing insertion. Examples include valuation products, energy certificate, modernization calculator and many more. The growth rates we achieved in our membership business so far in 2024 illustrate the point that we have permanently raised the bar for this business and we are very excited about our plans and momentum entering 2025.
We also said at the CMD that we had great know-how turning new product into subscriptions. LivingPlus is a good example of this. We now have more than 19,000 subscribers and we are closing in on EUR 1 million annual revenue run rate for this great new product.
For seekers, we said that we wanted to increase information and transparency around property data. To that end, we have added a fair price label for our listings. This is essentially pulling valuation data from Sprengnetter API and comparing it to the price asked from the agent. For seekers, we have also integrated AI filters on listings and we are one of the first classified in the world to do so. Interconnectivity also generates internal cost efficiencies as we become more productive.
As you can tell, we are very excited how we are executing and how the strategy is coming together. While we clearly still have much to do, we are confident to close out the financial year 2024 on a high note and we look towards the upcoming year with a high level of confidence.
And with that, I'll hand it over to Dirk.
Thank you, Tobi, and welcome, everyone. Let's turn to Page 6, where you can see the year-on-year revenue growth and ordinary operating EBITDA margins for our Professional and Private segment over the first 9 months, which both grew double digits in revenues.
The Professional segment achieved an 11.1% revenue increase. The ordinary operating EBITDA margin decreased by 0.1 percentage points to 62.5%. This is still a good achievement considering that last year's numbers did not yet include Sprengnetter until July.
We saw strong demand for Plus subscriptions in the Private segment, resulting in a 12.4% revenue increase. The ordinary operating EBITDA margin for the Private segment increased by 6.2 percentage points to 58.1% as we continue to scale the business and make high return marketing investments.
Let's turn to Page 7 for a closer look at the Professional segment. In the third quarter, revenue in the Professional segment grew by 6.5%, reaching EUR 103.4 million. This growth was primarily driven by the strong performance in our core membership products for which revenue increased by 9% in the quarter and 9.5% for the 9 months. We are very pleased that we continue to expand our Asian customer base, achieving a year-on-year growth of 2.5% in Q3.
ARPU in the Professional segment grew by 6.4% from EUR 943 to EUR 1,004, slightly slower than revenue from subscriptions. This development was driven by new customers generally coming in at a lower ARPU and the more challenging market situation for our commercial customers.
The transaction enablement revenue line reached an inflection point and grew by 2.9% in the third quarter of 2024, supported by the gradual recovery of the real estate market. Ordinary operating EBITDA in the Professional segment improved significantly by 11.3% in the third quarter of 2024. As a result, the ordinary operating EBITDA margin expanded by 2.7 percentage points, reaching 63.6%. This positive development is due to successful execution of our interconnectivity strategy, leading to an increased gross margin and increased internal productivity.
On Page 8, let's take a closer look at the private segment. In the third quarter, the private segment grew by 13.8%, reaching EUR 40.7 million. Growth was fueled by the continued strength of our Plus subscription portfolio, particularly driven by TenantPlus, as well as positive developments in BuyerPlus and a still small but steadily growing contribution from our newly launched LivingPlus products. The average number of private customers rose by 24.7% during Q3, reaching 470,507 in September. Subscription revenues for the first 9 months of 2024 increased by 24.8%, reaching EUR 65.8 million.
Ordinary operating EBITDA in the Private segment grew significantly by 31.1% in the third quarter and 25.9% for the 9 months, supported by the scalability of our Subscription business. As a result, the Private segment's ordinary operating EBITDA margin expanded materially to 61.3% in the third quarter, an increase of 8.1 percentage points.
Let's turn to Page 9 to review the main ordinary operating items. Operating effects for the third quarter decreased by 1.8% compared to last year. Over the 9-month period, expenses rose only moderately by 5.5%. These positive developments reflect the progress we see around interconnectivity, which generates scale benefits and productivity. One example of this are our marketing costs, which continued to decline as more and more product sales are triggered from within our ecosystem user base, drawing from our strong brand and traffic. The rise in operating effects on a 9-month basis stemmed mainly from higher personnel costs and increased other operating expenses, which were mainly driven by more external labor and professional services.
Ordinary operating EBITDA grew by 16.1% in the third quarter, which marks a meaningful acceleration compared to the second quarter. This led to a 4.1 percentage point expansion in the ordinary operating EBITDA margin for Q3 and a 1.7 percentage point improvement over the 9-month period. These strong margin improvements are driven by continued revenue growth from our higher-margin products as well as a positive trend in cost management.
Overall, we are pleased with our current cost structure and our ability to effectively manage cost moving forward. You can expect us to remain focused on driving business growth while continuing to enhance profitability in the coming quarters.
Let's turn to Page 10, where you see the items below ordinary operating EBITDA. Non-operating effects increased by moderate 6.2% in the third quarter, returning to more normalized levels after the strong increase in the first half of 2024 due to the higher accruals for share-based compensation. On the 9-month basis, nonoperating effects remained 41.4% higher year-on-year. Reported EBITDA improved by 16.8% to EUR 85.3 million in the third quarter, slightly ahead of ordinary operating EBITDA.
Moving now to items below reported EBITDA. D&A came in at EUR 11.5 million in the quarter, increasing by 24.2% due to increased amortization of internal completed projects as well as D&A related to PPA from the Sprengnetter acquisition. D&A in the third quarter was lower compared to the second quarter, in line with comments we shared during the last earnings call. We expect D&A to stabilize at current levels for the fourth quarter as well.
The third quarter reported net income grew 8.4%. Growth was negatively impacted by strong financial results in the third quarter last year, which was fueled by positive one-offs. Earnings per share for the quarter amounted to EUR 0.69, representing growth of 9.9% year-on-year.
Adjusted net income for the quarter was up significantly at 14.4% and adjusted EPS grew by 16%, slightly less than ordinary operating EBITDA due to higher D&A expenses and the effects from the financial results.
Turning now to Page 11 to walk you through a bridge from reported net income to adjusted net income. This is an additional piece of disclosure we have added for this quarter. The purpose is to provide a clear overview of the adjustment items between reported and adjusted net income. We believe that this is important as our active M&A strategy and also the recent strong share price since 2023 has created differences between the two baselines. Let me call out a couple of points.
Nonoperating effects, excluding share-based compensation were driven by increased provisions for milestone payments related to the Sprengnetter acquisition as well as a revaluation of the remaining 25% stake. This increased provisioning impacted both M&A costs and the financial result. At this point in time, we do not expect to increase provision levels further.
On the topic of share-based compensation, we discussed during the last earnings call that it will be higher this year than historically. The reasons are strong share price and business performance. For the 9-month period, we currently stand at EUR 20.4 million. For the full year 2024, we do expect to remain within the EUR 20 million to EUR 25 million range. Please note that the majority of positions I just discussed will not have a cash impact in the ongoing financial year.
Turning to Page 12 on the topic of cash flow. We believe that one of the core advantages of our business model is the strong cash generation. As we move from executing our product vision and growth targets to improve our profitability, we now add the third element focusing on our strong cash generation. This additional slide allows you to track our free cash flow generation on a quarterly basis.
The strong and growing cash flow generation of the Scout24 financial model is an important part of our equity story, which we want to highlight. To simplify reconciliation, we are starting the bridge from reported net income and progressively building up to the free cash flow figure. Free cash flow for the 9 months was very strong at EUR 172.9 million, representing growth of 24% year-on-year. The strong year-on-year growth was driven by a combination of revenue growth, increased profitability and positive working capital changes due to the high amount of noncash nonoperating effects I mentioned on the slide before. Free cash flow conversion as a percentage of adjusted net income and ordinary operating EBITDA for the 9-month period was at 111% and 67%, respectively.
Turning now to Page 13. We focus on our leverage development and capital allocation strategy. At the end of the third quarter, our leverage stood at 0.4x, which was slightly decreased since its peak earlier this year following the dividend payment. Leverage was reduced as our ordinary operating EBITDA continues to grow and we repaid some debt. We expect leverage to remain in the range of 0.4x to 0.6x in the upcoming quarter.
We continue to deploy capital for our shareholders. In the third quarter, we bought back shares for a total of EUR 21.8 million, which is a meaningful increase compared to the second quarter.
Let me wrap up with some key takeaways. Just 8 months after our Capital Markets Day, we are on track to deliver with guidance at the top of the range, implying double-digit revenue growth and a margin at the upper end of the range we shared in February. These results are not a coincidence. They are a combination of our unique strategy with our strong teams delivering high-quality operational execution.
Revenue growth in our core business lines is getting stronger as a result of interconnectivity and we expect to see these developments going into 2025. Our transaction enablement revenue line offers upside as the transactional markets recover. Executing on interconnectivity will also continue to generate cost savings as organizational efficiency improves and marketing costs are reduced plus more products draw on the power from within the ecosystem.
On the M&A side, we have shown over the years that we have the ability to acquire strategic companies, integrate them well and continue to generate margin expansion on group level. Expect us to continue on this path.
Moving to the guidance on Page 14. As a reminder, our guidance for 2024 assumes 9% to 11% revenue growth and an ordinary operating EBITDA margin of about 61%. Based on the strong business performance in the first 9 months of 2024 and our constructive outlook for the fourth quarter, we have decided to narrow the current guidance range to the upper end, both for revenue growth and ordinary operating EBITDA margin. In terms of outlook for the fourth quarter, we expect trends to remain broadly similar to what we have seen in the third quarter.
In summary, with the momentum we are experiencing in our core business, a slow but steady recovery of the real estate market as well as increased organizational efficiency, we feel very confident to close out the fiscal year 2024 on a high note. While it is too early to talk about 2025, we feel good about the momentum we are currently seeing in the business and expect to carry this into next year as well. We will provide the next update during our preliminary Q4 full year 2024 earnings call on February 27, 2025.
And with that, let's open the line for questions. We would appreciate if you could limit your questions to 2 per speaker. Operator, over to you.
[Operator Instructions]
First question comes from William Packer from BNP Exane.
Two from me, please, kind of related. So firstly, you gave some helpful data about demand side indicators, which are supportive. We can see the leading indicators of mortgage approvals are supportive. When do you think we start to see a substantive improvement in transaction levels? And when do we start to see normalization back to historical levels?
And then the second part of the question is, could you help us think through for your key business lines, how that will impact your business when we do see that recovery? I suppose the context is, there's a lot of optimism for the property classified segment on how this transactional recovery will flow through to the businesses. And clearly, some segments will do better. But you think considering in 2023, your performance was very resilient on countercyclical dynamics in areas like PPA, it could have more of a mixed impact on your business. So could you just help us think through for your core state agency subscriptions for the PPA business, for your private subscriptions, how that cyclical -- impending cyclical rebound flows through?
Will, thanks for the question. This is Dirk. Trying to fully answer your questions around, first of all, the German market. As you have seen, we've seen a slight growth on the transaction enablement here about 3%. And that is an indicator that transactions in Germany are continuing to grow versus 2023, where we've seen a very depressed year.
We also see that based on that developments, the amount of leads that we are generating through our platform, buyer leads, have increased by 9% on the average in certain areas by up to 28%.
So the market is pretty lively, and we expect that to continue over the next quarters to come. When we will return to basically the amount of transactions and the transaction levels we've seen in 2022, 2021, we believe that's going to be more in the outer years of our overall long-term guidance. So we're looking at '27, '28. But apart from that, I think compared to the market and how the business has been performing in 2021, 2022, the return of the transactions will help us to continue our growth momentum going forward. So when we see further movements in mortgage rates going down, it is quite obvious that, first of all, our mortgage business will have an advantage around that.
We will also see an advantage in our seller leads business. This time, as opposed to '21, '22, we're going to see our seller business continuing for much profiting and continuing to get much, much more organic seller leads than bought seller leads, as we've seen in the past, the profitability and volume will increase in both revenue lines, seller and mortgage.
On the transaction enablement side, the remainder of the transaction enablement side, valuations certainly will go up. So we're going to profit with that from our Sprengnetter business. In the core membership business, we believe that the gray market is something from the past and it will not return simply for the fact that prices are rather moving sideward whereas transactions are picking up and not upwards. So our buyer lead business, which is reflected by our core membership business will also profit from more transactions in the German market because they also mean that the health of our more than 25,000 agents on the platform is insured.
Now going through the other revenue lines, like in the Private segment, our TenantPlus product, we believe that this is now a standard in the German market. As of today, we have around 470,000 subscribers and we believe that we can get much more of the around 4 million rental transactions in Germany from our subscriber base. And we don't believe that there will be a market situation where the rental market will be in a situation where we have lesser demand from tenants in the market.
And I think overall, your last question was around PPA. I think we've said everything about the professional PPA in the past calls that you've followed. We believe this is a more stable revenue line and the same will be the case on the private PPA revenue line. So we're going to see slight uptick, maybe single-digit growth, but we're profiting more and more from migrating those demands into our subscription memberships. I hope that was an answer to your question.
Yes. So it sounds like the disappearance of the gray market is a bit of a structural factor that will assist you as we go into the next phase of the cyclical recovery as well. That's very helpful.
Yes. And you can see that also. I mean the transaction market is coming back and we are improving our listings. I think that's quite a good data point to underpin that.
And next question comes from Doyinsola Sanyaolu from Citi.
Thank you for today's presentation. I had two questions. In the Private segment, we saw a strong development in customer numbers and ARPU. Do you think this new level of customer numbers is sustainable in the near term, such that the 500,000 target for 2026 could be conservative? And then maybe along the same vein. Could you talk us through some of the developments in the uptake of LivingPlus, BuyerPlus, et cetera? Are they the main drivers of customer number growth? And maybe like what's really driving the increased interest? Is it all macro or is there more of a push around some of these products? And then just as a tiny add-on to that, maybe why are some customers less interested in the third-party credit checks?
This is Tobi. Thank you for your question. Let me start providing some color. With regards to our Private segment, you pointed out correctly. We're very happy with the development. And we do think that in the past, there are always questions about, first, can we get to the number that we had laid out in the past, around the 500,000 subscribers by 2026. Clearly, we have a line of sight that we can get there. We don't think this is a conservative objective. We rather think this just proves that we are able to really innovate around an initial idea and then scale that idea. That also leads to ARPU development, customer number and then driving the engagement.
What we are doing is we are creating more and more services and ramping more products around the customer base. So what you will see in the future is not necessarily such high growth in the customer numbers itself, but rather seeing that we're taking the relationship, we're picking it up and we're extending the lifetime given the fact that we're moving into different phases, such as LivingPlus, where all of a sudden, we've passed the stage of just finding the new home and then moving in and being a partner at their side.
So that's coming back to the interconnectivity strategy we are pursuing because let's not forget, we initially started solving for one pain point. But now we are a partner to our customers who have found a home, who are moving into a home, who then have completely new challenges with the home such as the energy bill, such as the utility checks, such as legal advice because they might be pushed out of the apartment because the owner wants to move in and things like that.
So you should expect more around the product itself and innovation rather than us coming up and saying, hey, by the way, we're going to have 750,000 subscribers. That's not so much our goal. Our goal is more like providing more value for the existing customer base. Hopefully, this is helpful color.
The next question comes from Jo Barnet from UBS.
Excellent. So two from me. Firstly, EBITDA margin in Private improved by, I think, it was 8 percentage points year-on-year. Could you give us a little bit more color on the key drivers behind that? I appreciate there's a degree of seasonality. Do you think that the achieved margins above 60% are sustainable? And how should we think about that into next year?
And then secondly, you mentioned the narrowing of the guidance range to the upper end. I think your ordinary operating EBITDA margin guide is circa 61% not a range. So just how should we interpret that? Should we think of that as greater than 61% now? Or would you steer us in some other way?
Jo, thanks for both questions. First of all, on the Private margin, I think that is something which will continue and is pretty stable to upward development and that has simply to do with the fact that we are now using a dual vendor strategy on our credit checks. On the outlook, you're right. It was a bit of a language issue. But you can expect us certainly not to deliver below 61% rather on top of it. And I think that gives you enough color on the question.
We now have a question from Craig Abbott from Kepler Cheuvreux.
Congratulations on the good results. Yes, I wanted to follow up on the earlier question regarding the different subscription product categories within Private all performing very well. I think you were very clear that big driver going forward is going to be more the value add and customers simply consuming more products that you're offering.
So my two follow-ups there, if you will, just a two-part follow-up there is, I mean, should we kind of assume -- I know you're not guiding on this, but can we kind of assume, nevertheless, similar overall growth rates in that subscriber revenue line, even if the actual growth in the number of subscribers maybe start slowing down to the higher base effect that you, I think, you were kind of alluding to.
And the second part of that is if you could give us an update on just kind of like the average duration across your portfolio? And then I have my second question after that.
Craig, I'll start off with your question around the development on Private. I mean our strategy here, I believe, is quite clear. First of all, we were in a, so to say, land grab mode. We were trying to make the product a standard product in the German rental market and I think we have a tick in the box here. That's done. What we have been doing in the meantime, as referring to Jo's question before, was to improve our quality of the product, and we are now following a 2-vendor strategy here, which will improve the margin slightly.
The next phase is going to be putting some additional product features into it. And with that, trying to have a longer lifetime of our customer base. So we're coming from 5 to 6 months. Now, above 6 months, 6 to 7 months is what we're seeing. And then we're going to see slight improvements on the overall ARPU in Private. And if you put all that together, we're very optimistic to grow at levels that you've seen this year, slightly below that, but we're very optimistic that the overall business will continue to be developing or developing very, very healthy.
Second part of your question, you go ahead, Craig.
Yes. No, my second question. By the way, there was a lot of very useful color there. I think the question is more big picture overall for the group. Just wondered if you could give us an update on any new developments you may or may not have seen on the competitive front in the last quarter.
Craig, it's Tobi. We've not seen any major new developments aside from what's publicly known and that you're all aware of, whether it's what will happen as a part of the split between the Sprengnetter assets or whether it's the take private of the Adevinta assets, but we've not seen anything changing in the competitive set per se, which is also why we are super focused on our own strategy because hopefully, by now, we've demonstrated that we've built something really unique with, again, our customer base in the private sector where we're having more and more active customers than with our professional record level numbers and then also with the new membership products we've launched in the professional world, which are more and more adopting penetration towards multiproduct/interconnectivity products and that will make a huge difference going forward. So we are super focused on our strategy.
And the next question comes from Christopher Johnen from HSBC.
First one on the membership package migration. Can we get an update on that, where you stand? I think last quarter, you said you had a couple of thousand people migrated. I'm just trying to -- if you cannot be specific just on the quarter, maybe you can share a bit of a view as to where you expect to be at the end of the year so that -- I'm trying to get a bit of an idea as to how much will potentially be left over as we enter 2025. That would be interesting.
And then the second question, maybe there is a bit of color you can give on what level of savings and marketing we are looking at as we sort of exit the year and go into next year. I understand the interconnectivity sort of driving cost savings, but it's -- I guess it's not tangible enough for me. Maybe there is some color you can give on the scope. So we get an idea. This quarter was, I think, 17.5%. For the 9 months, it was 3-point-something. So just maybe you can give us a bit of a range or something to work with as we enter '25.
Chris, it's Tobi. With regards to your first question, you're correct. We pointed out the last time that we had already successfully migrated a couple of thousand professional customers. We are on a really healthy trajectory. Otherwise, we wouldn't be able to demonstrate also the -- those numbers we've just published. Please do understand, we cannot give you a concrete number towards the end of this year. It's also for competitive reasons we are not disclosing that. But let me just give you a little bit more color so hopefully, you can relate to the facts and interpret that the right way.
These are the strongest membership additions and product world that we've ever pulled out. We have a really high satisfaction level and people and professional agents understand the power of these additions. We have just started to begin to roll out our own currency, [indiscernible], which, by the way, has been in the making for many years as an additional tool set to make it easier to adopt and also to migrate into other product worlds within your either existing membership world or as an upgrade on to your next. And this is still in its infancy.
So hopefully, you can get a sense for not only how strong the products are, but also how excited we are because the market response is very positive and we are just at the very, very early step of even trying to translate and making people understand what's in it for them if they stick around and if we have more data points to finance the exact membership package they need and then throw in the [indiscernible] that they can make a move within their membership or moving up and being upgraded.
And Dirk, maybe on marketing, you can say something?
Yes, Chris, I mean, you've probably seen that we decreased marketing by 17% in our results compared to Q3 last year. And I think it would be fair to think about the same decrease for the fourth quarter compared to the fourth quarter 2024. We're going to act a little bit sort of more on short notice here. If we see that we can do marketing with an improved ROI, we're going to certainly do that. But according to our plans, we're going to see a saving in roughly the same amount that we've seen in the third quarter.
Our next question comes from Nizla Naizer from Deutsche Bank.
I have two questions as well. The first is on M&A. In your remarks, you mentioned that it still remains a key focus. Could you remind us again which parts of the business you would like to strengthen potentially through M&A, like what's on your wish list ideally? Some color would be great there.
And secondly, on growth, it was another very strong quarter of net additions in your agent base, like it's up 308 on average. Could you remind us again where are these agents coming from? Is it -- is there an element of maybe agents in Austria in there as well? Or is this largely in Germany? Some color there would be great. And could these trends continue in Q4? Or should we expect sort of a step down from these levels given the high base already? Some color there would be great.
Nizla, it's Tobi, I'll start with the first question around M&A. Yes, we're happy to iterate what we had shared previously, which means we do have a continued focus on what we call proudly strategic acquisitions that fall into the category of what we did with Sprengnetter, which was clearly going after valuation services or anything else in the data space, focused primarily on driving our Professional segment growth. That's probably one. And whenever we think there's an opportunity that we can pick up the pace or accelerate something that we otherwise would have to do in-house, that's one criteria. And otherwise, product gaps, there's not many, but there's still a few spots here and there where we feel we could find a suitable target. That's our primary focus.
And I think we've built a pretty good muscle now, how we identify companies, how we then speak and talk to them and then how we maybe also get to a transaction and integrate them and absorb them as part of our ecosystem. So that's something we shouldn't forget 3 or 4 years ago, we didn't really know how to do that. And by now, we've digested a few and we've made a couple of mistakes here and there, but we also -- we got it right. So we feel very good about that, and that's going to be our focus. And maybe, Dirk, on the other question?
Yes. I think you can assume that out of the 24,700 agents that we're having on the platform, around 2,000, and that's really more of a stable part, is coming from Austria. We haven't seen huge changes there and the rest is coming from Germany. And the teams, of course, want to go to 25,000. I think that's a number we are all aiming for. If that's at the end of Q4 or at the end of Q1 or Q2 next year, I'm a bit agnostic but I have no doubts that we're going to achieve that target.
And our next question comes from Giles Thorne from Jefferies LLC.
The first question was back on transaction enablement and specifically mortgage leads. And it was sent to that earlier, but just to dig into it, it would be useful to get a reconciliation between the industry data we're seeing on mortgage lending, which is pretty robust and your comments that mortgage deals is still quite soft. And then the second question was just on the organization, you'd merged about 18 months ago, the CTO and CPO roles under Ralf but I see that you now split them out again. So it would be interesting just to hear the logic for that move.
I think I take the first one, Giles. And I think the difference that you hear in our language versus the overall language in the market, which is a bit more upbeat is the fact that we might see a bit more refinancing in the market, which is usually happening with the existing bank than we've seen in the past. But we are quite optimistic, as I said, that our mortgage business will also improve. And what you need to keep in the back of your head is that we are -- with regards to growth of our mortgage and seller leads business, much more focused on delivering that on a very profitable basis. And that's why you might have seen us compromising on return on invest versus level of growth. But overall, we have no doubt that we're going to return to growth rates that we've seen previously here.
And for the other question, I hand back to Tobi.
Yes, certainly. So with regards to the organizational question, we are very happy that we found Gertrud, who joined us a few months ago as our CTO. As you know, we've had that position in the past already. And then we decided to not have a CTO for some time because there was a lot of heavy lifting we wanted to get done in order to get connectivity going between the teams, and that's why Ralf decided and we, together, decided that we would pause but then it was always the plan to rehire at the appropriate time another CTO. And that's why now with Gertrud, we have strengthened that part. So Gertrud obviously reporting to us. Ralf leads still the technology engineering product and the data part. And we're just super happy that we found her because there's a lot to do around AI and what have you. And so yes, other than that, no other changes.
And we have a follow-up question from William Packer from BNP P Exane.
Just a quick one. Do you mind just clarifying the message on FY '24 margins? My understanding was that you were reiterating the top end of current guidance, so near 11% revenue growth and towards the top end of 61%, i.e., 61.4%. Is that a misunderstanding?
No. Will, I said it's going to be not less than 61% and we would like to stick to that language.
So it could be 62%?
62% no. 62% is the right level to assume for next year, and that's what we guided. But no.
Sorry for the misunderstanding.
Ladies and gentlemen, that was the last question. I would now like to turn the conference back to Filip Lindvall for any closing remarks.
Okay. So this concludes today's conference call. Thank you all for dialing in and your questions, and thank you for your interest in Scout24. Have a good day, and for those of you who celebrate Halloween. Bye-bye.
Ladies and gentlemen, the conference is now over. Thank you for choosing chorus call and thank you for participating in the conference. You may now disconnect your lines. Goodbye.