Adyen N.V.

Welcome to Adyen's H1 2023 earnings call. We look forward to discussing our key updates from the last period. We closed H1 with continued growth of 739.1 million euros in net revenue, up 21% year on year. Though we remain focused on building Adyen for the long term, this cycle presented shifting economic dynamics. As the macro landscape evolved, we saw North American digital businesses increasingly prioritize cost optimization. We know that growth is not always linear and continued progressing towards our sizeable opportunity while meeting our customers ever evolving needs. This included launching new products across all pillars from advanced authentication functionality that drives conversion to tap to pay on Android to productizing our payout solution. These innovations enabled us to help drive our customers' ambitions even in the current climate, and enabled our distinct momentum across our platforms and unified commerce offerings. To further our trajectory, H1 was also a period of continued investment in building our global team to accelerate growth across key initiatives and regions. The talent market provided a tailwind that helped us remain on track in adding 551 joiners this cycle. Along the way, we remained focused on effectively scaling our culture of speed and autonomy across our global team. Following this continued investment period, EBITDA margin landed at 43%. With the team nearly at its next phase of scale, we remain confident in the robustness of our business model and the long-term opportunity ahead of us. Together, we are working to realize it. We are now pleased to dive into this period in greater detail. We'll start with a fireside chat with our co-founder and co-CEO, Pieter van der Dus, and our CFO, Ethan Tandowski. We'll then open the floor for a Q&A during which you can send in your questions using the Q&A functionality at the bottom of your screen. Please note that the raised hand functionality will not be incorporated. We ask you to leave your full name and the firm you represent when submitting your questions. We will unmute you to ask them live at the end of this segment. Thank you for your cooperation.

Good morning, good afternoon, and good evening, and thank you for joining us today at iGen's 2023 H1 Earnings Call. I'm really glad to be joined today by our co-founder and co-CEO, Peter van der Does, and our CFO, Ethan Tendowski. Now, let's jump right into it, Peter. If you look back at the first half of this year, what are the things that really excited you, and perhaps also touch upon a few of the things that perhaps didn't grow according to our expectations?

What we are really pleased to see is that, let's start with platforms. Many of the business that we do, the companies that we do business with as consumers, the SMB, the smaller and mid-sized companies, they're on the platform. And what is happening that as SMBs move more to platforms, it's an essential part of the economy for us to be part of. And we see very high growth there. So that's important. It's an area where we have been investing. You see that we release a lot of products and that we have a lot of traction there. growing of a smaller base, obviously. Unified commerce, to merge what is happening in store with online, so that those shopper journeys work perfectly. We are very good at that and we see high growth there. If you look at online, where we started the company, we see lower growth than what we hoped for. And the reason for that is that we have seen increasing competitive pressure in North America. And that's, to my view, related to a higher interest rate environment. More companies are looking at the bottom line, and that's an environment in which they try to see if cheaper alternatives work. It's the part of the business that's easiest to switch, US online. We're still growing, right? So it's not that we're shrinking there, but it's growing at a lower pace than anticipated. Still, we feel that we should also in that part of our business keep investing because total cost of ownership is ultimately what defines the choice of payment partner. And we believe that we have still room to also further invest there and make the product even better. And that's the way to grow also in a digital part. We expanded the team. We also announced already last year that we'll grow this year with about the same number of people as we did last year. We're well on track there. And that's necessary because if you look at our long term opportunity, nothing changed. It's still out there. It's still huge. And we need to have the right team on board to grasp that opportunity and We are building towards that. It's a good market for us to hire people. So we get very talented people on board. We always have the bar very high. We keep it high and we're successfully executing there.