Global Business Travel Group, Inc.

Good morning and welcome to the American Express Global Business Travel First Quarter 2025 Earnings Conference Call. As a reminder, please note today's call is being recorded. I'll now turn the call over to Vice President of Investor Relations, Jennifer Thorrington. Please go ahead.

Hello and good morning, everyone. Thank you for joining us for our First Quarter 2025 Earnings Conference Call. This morning, we issued an earnings press release, which is available on scc.gov and our website at investors.amexglobalbusinesstravel.com. A slide presentation, which accompanies today's prepared remarks, is also available on the Amex GBT Investor Relations webpage. We would like to advise you that our comments contain certain forward-looking statements that represent our beliefs or expectations about future events, including industry and macroeconomic trends, cost savings, and acquisition synergies, among others. All forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from the statements made on today's conference call. More information on these and other risks and uncertainties is contained in our earnings release issues this morning and our other SEC filings. Throughout today's call, we will also be presenting certain non-GAAP financial measures, such as EBITDA, adjusted EBITDA, adjusted EBITDA margin, adjusted operating expenses, constant currency, workday adjusted revenue, free cash flow, and net debt. All references during today's call to such non-GAAP financial measures have been adjusted to exclude certain items. Definitions of these terms in the most directly comparable gap metrics and reconciliation for non-gap metrics are available in the supplemental materials of this presentation and in the earnings release. Participating with me today are Paul Abbott, our Chief Executive Officer, and Karen Williams, our Chief Financial Officer. Also joining for the Q&A session today is Eric Bach, our Chief Legal Officer and Head of Global M&A. With that, I will now turn the call over to Paul.

Thank you, Jennifer. Welcome to everyone, and thank you for joining our first quarter 2025 earnings call. I'd like to kick off with some key points we want you to take away from today's call. First, we continue to deliver really strong results in the first quarter with 15% growth in adjusted EBITDA, 260 basis points of margin expansion, and a 9% increase in free cash flow. We are delivering on the commitments for strong earnings growth, margin expansion, and cash generation. Second, we have diverse resilient revenue streams, very high customer retention, and consistent share gains. Our Q1 performance demonstrates these very strong fundamentals. Third, we have a strong and flexible operating model that allows us to adapt to a range of economic conditions We have a proven track record of cost control and margin expansion that positions us well to manage through more uncertain economic conditions. And finally, we are continuing to invest to drive sustained growth with confidence in our long term growth prospects. There is obviously more economic uncertainty and as a result, less full year visibility. But we have delivered strong Q1 results and a solid guide for Q2. Our approach to a slower growth environment is to remain laser focused on what we can control share gains, margin expansion, cash generation, and driving shareholder returns. Turning to the first quarter highlights, we delivered strong adjusted EBITDA and cashflow growth and impressive margin expansion in line with our commitments, despite a slower demand environment. Our value proposition. To provide customers more savings and control over their travel spend becomes even more valuable in a weaker economic environment. We continue to gain share with an accelerated pace of new wins, and importantly, we maintained a very high level of customer retention. We have previously talked about our capital allocation strategy, and we are executing exactly what we said we would do to drive shareholder value. We've lowered our leverage ratio, received two credit rating upgrades, and amended our CWT merger agreement to reduce the original purchase price and the number of shares issued. The current environment doesn't change our longer-term strategy or our earnings power. We believe our resilient and flexible business model will demonstrate that we are the preferred industry investment during this cycle and for the long run. Taking a closer look at the financial highlights of the first quarter, growth rates provided here are on a constant currency workday adjusted basis. Total transaction volume was up 4% driven by increased demand for business travel and our share gains. TTV, or total transaction value, which reflects both volume and price, grew 5% to reach $8.3 billion. This was driven by transaction growth and modestly higher average ticket prices and hotel room rates. Revenue was up 4% to reach $621 million for the quarter, driven by solid growth in transactions and TTV and increased demand for our products and professional services. Although these top line results were solid, they were roughly one percentage point softer than we expected coming into the year due to a modest slowdown in organic transaction growth. However, our focus on margin expansion and operating leverage resulted in adjusted EBITDA growth of 15% to 141 million in line with what we said we would deliver with strong margin expansion of 250 basis points. Turning to the workday adjusted transaction growth in more detail, Just as a reminder here, for organizational purposes, we divide our customer base into two general categories, global multinational and small and medium enterprises. We don't have products or services that are offered solely to one size of customer. Customers of all sizes may prefer different solutions. Some larger customers may prefer a simpler approach, while some smaller customers may prefer a more bespoke, high-touch global solution. transaction growth was relatively stronger with global multinational customers up 6% in the quarter, we saw stronger growth in financial services, pharma and industrial sectors. And the broad range of industries that we serve brings us diversification to our revenue streams. SME growth remains slower at 2%, as we previously described, SME customers have tightened spending controls in a broader trend for SME businesses beyond just travel spend. Growth in domestic air and regional and international air transactions were both up 2%. Our US air TTV growth was 3% in the quarter, in line with the commentary provided by the major US airlines on corporate spend growth. We are also well diversified from a supplier perspective, with hotel becoming an increasing share of our revenue. Growth in hotel transactions continues to outpace air at 5% versus 2%. This reflects industry trends and also our focus on increasing our volume of hotel bookings as we continue to strengthen our hotel content and display and provide customers with more hotel value and more choice. Finally, on a regional basis, transaction growth was 3% in the Americas, 4% in EMEA, and Asia Pacific continues to outpace the rest of the world at 7%. So turning here to the commercial highlights, our solutions provide complete visibility and control over travel spend. And our marketplace provides access to the most comprehensive and competitive content to deliver customers significant savings. Plus we've also maintained our ability to invest through different economic cycles. Because of all of this, we have historically seen strong sales performance and a flight to quality during more challenging macro environments. In the first quarter, we continued to gain share. We said our total new wins value would accelerate in Q1 and it did to a total of 3.2 billion over the last 12 months. And importantly, These share gains are on a very strong foundation of impressive customer retention of 96% over the last 12 months. Our value proposition is clearly resonating with SME customers, which represents our biggest growth opportunity. SME new wins value totaled $2.3 billion over the last 12 months. More and more SME customers recognize the benefit of a managed travel program, with our number of unmanaged SME wins up 8% year over year. We continue to invest in technology transformation, including automation and AI to improve the customer experience and increase productivity. Let me provide clarity on the actions that we're taking with our operating costs and productivity gains and what makes our earnings less sensitive to softening economic conditions. In the first quarter, 81% of our transactions came through digital channels. Growth in digital channels was 5% year over year on a workday adjusted basis and outperformed overall transaction growth as we intentionally drive a higher mix of these more profitable, higher margin digital transactions. Over 60% of our digital bookings came through on our own software platforms, NEO and Agencia. Owning our software platforms is a significant competitive advantage. We've proven that we can improve the user experience and accelerate the share of digital transactions using AI and machine learning to improve productivity and reduce costs. Adjusted operating expenses declined 1% year over year, even with incremental investments in future growth. And traveler care productivity went up an impressive 7% year over year in the quarter. The end result? 260 basis points of adjusted EBITDA margin expansion, a powerful demonstration of our cost control and productivity gains. Finally, regarding the CWT transaction, we announced an amended merger agreement. The highlights are an extended deadline to provide the parties with additional time to defend the lawsuit filed by the DOJ as necessary and a revised transaction value. with a reduction in the number of shares expected to be issued from approximately 72 million to approximately 50 million. And now I'd like to hand it over to Karen to discuss the financial results and the 2025 outlook in more detail.