Getty Images Holdings, Inc.

Please stand by. Your program is about to begin. Good morning, and welcome to Getty Images' second quarter 2024 earnings conference call. Today's call is being recorded. We have allocated one hour for prepared remarks and Q&A. At this time, I would like to turn the conference over to Stephen Kanner, Vice President of Investor Relations and Treasury at Getty Images. Thank you. You may begin.

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 Layden, 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 statement section of Friday's press release and in our filings with the SEC. Links 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 they 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 for 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.

Thanks, Stephen, 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 achieve 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 and 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 and 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 am reminded of what truly sets Givity images apart and of the durable value we convey 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 pre-shot 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 PixArt, 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-winning 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 am excited to build on our momentum over the second half of 2024. I will now turn over to Jen to take you through the more detailed financials.