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spk07: Ladies and gentlemen, welcome to the TDCF Q2 2023 results announcement. My name is Ada and I will be coordinating your call today. If you would like to ask questions during the presentation, you may do so by pressing star 1 on the telephone keypad. I will now hand you over to the management team to begin.
spk03: Hello everyone and welcome to TDCX Second Quarter 2023 Earnings Conference Call. My name is Jason Lim, the Head of Investor Relations. Joining us on the call today is our Executive Chairman, Founder and CEO, Mr Lahong Junick, our CFO, Mr Chin Tzu Ning, and our EVP of Corporate Development, Mr Edward Goh. Before we continue, I would like to remind you that we will make forward-looking statements which are subject to risks and uncertainties and may not be realised in the future. you should not put any reliance on any forward-looking statements. Also, this call includes the discussion of certain non-IFRS financial measures, such as adjusted EBITDA and constant currency revenue growth. For reconciliation to the closest IFRS measures, please refer to the Form 6K, which is available on our website. We have prepared a convenience translation for the Singapore dollar to the US dollar at a rate of 1 USD to 1.3557 Singapore dollars. This should not be construed as representation that any Singapore dollar amount can be converted to USD at this or any other rate. With that, let me hand over the call to Lahon. Lahon, please.
spk02: Hello, everyone, and thank you for joining us today. We delivered a strong and resilient set of results against the backdrop of a challenging environment. I appreciate that everyone at TDCX has put in the extra mile to achieve this, and I would like to thank our global team for their efforts. Let me begin with some highlights. Q2 2023 revenue rose 5.5% year on year. On a constant currency basis, revenue would have grown an even stronger 11.3%, which significantly exceeded our guidance. Our largest segment, Omnichannel CX, continued to grow at a nice clip of 8% year on year. Our traditional strength in sales and digital marketing also came through as the segment grew 15%. We continue to deliver industry leading margins with adjusted EBITDA margin at 25.9% for Q2 2023. Margins were down compared to last year as we continued to put in necessary investments to position ourselves stronger for tech sector recovery. This includes initiatives such as our geographic expansion, building out of our TDCX AI arm, and operationally keeping strong agent and support ratios for our clients. Our CFO, Mr. Chin, will provide more details on our margins later. Operationally, I'm very proud that we remain at the top end of performance tables for our clients, and as a result, continue to grow business broadly across our clients. Revenue from clients outside the top five grows 67% year on year. If not for the impact of one of our key clients reducing volumes as part of their focus on cost efficiency, we would have registered much stronger overall revenue growth. Our strategic geographic expansion over the last two years has really started to contribute meaningfully. All-in revenue from our new geographies was nine times in Q2 2023 compared to what it was in Q2 2022. This included clients that we added from our Hong Kong subsidiary as well. Overall, we delivered a robust earnings performance as profit for the period rose 9.4% to 22 million US dollars. We stand out amongst peers in our sector in still being able to deliver good earnings growth over a very tough period. This clearly demonstrates that TDCX continues to execute at very exceptional levels. Our profit performance has translated into strong cash flows and a strong balance sheet. Cash generated from operations was $49 million for the first half of 2023. As of 30 June 2023, we have $301 million cash and cash equivalents with no debt on the balance sheet. This puts us in a very strong position to move quickly on several strategic growth options, especially in an environment of high interest rates. We continue to explore M&A opportunities that could help enhance our capabilities or reach to better serve our clients or to accelerate our growth. Besides that, we have the financial strength and flexibility to deploy capital for important organic initiatives such as TDCX AI, our consulting capabilities and investing in our new geographic sites. I'm very happy with the progress that TDCX AI is making and we're growing our team steadily. Our clients have entrusted us on consulting and advisory services and in piloting and implementing AI-enabled CX solutions. A number of projects are in the pipeline. For example, with a large tech client, our team was tasked to analyze the cognitive load of multi-skilled agents and to identify the tipping point at which an individual agent would be overwhelmed by product information and which would impact the way a customer service campaign would be set up. Another example we've done for clients is modeling and analyzing agents' learning curves and thereafter developing customized roadmaps such that agents reach peak performance faster. For a travel and hospitality client, we incorporated machine learning to anticipate and decrease employee attrition by up to 15%. We are also leveraging Google Cloud's enterprise-grade generative AI capabilities, to build an AI-enabled chatbot to respond to candidates' queries about our company and the recruitment process, and integrating this with our proprietary flash hire recruitment system. To sum up, there are huge businesses as well as productivity improvement opportunities with AI, and we're moving at incredible pace to take advantage of these. CDCX is very differentiated. We are agile, nimble, and hyper-focused on the complex CX segments, which requires human intervention, and that is not easily replaceable. Our positioning and strengths in Southeast Asia are unique amongst global CX providers. I'm not sure if the public markets have misunderstood or overreacted to the threat of GenAI, while underestimating the efficiencies and opportunities that this could bring. At current trader levels and considering the profitability and cash generation of our differentiated business, we see great value and we intend to prioritize share buybacks as a form of enhancing shareholders' returns. Next, let me touch on some client highlights. Our business development momentum remains very strong. Client count rose 52% to 91 clients as of June 30th, 2023. And we have a further seven clients who have been signed up but not yet launched. Beyond the quantity, I'm excited about the quality of clients that we launched in Q2, which included several giants of the world in their respective spaces. This includes an established global e-commerce platform based out of the U.S., a rapidly growing fast fashion e-commerce platform, which is one of the two fastest growing giants globally, and a leading travel platform based out of Asia, which is one of the world's largest in this space. With a higher client count and broader growth, we improved our revenue diversification as our top five clients contributed 73% of this quarter's revenue down from 83%. in the same period last year. In terms of geographic reach, we now have a much wider footprint compared to two years ago. With a growing headcount of over 18,700 employees globally, we are able to serve more clients across the world. The revenue chart here demonstrates our unique positioning amongst global listed CX providers with around 71% of our business focused on serving Southeast Asian and North Asian languages. Before I hand over to our CFO, let me share some views on the outlook. Having completed half the year now, we have a better sense of where we will land for FY 2023. We've seen delays in decision-making from clients and the lengthening of the sales cycle throughout the first six months. The effect flows through to the second half, which means that the higher end that we were aiming for in second half 2023 is not coming through. As such, we are adjusting our FY 2023 revenue outlook to reflect this. Mr. Chin, we'll provide more details later. While we do not want to get too much ahead of ourselves, we are starting to get the slightly clearer picture of how the next year is going to unfold. They are encouraging signs for economic activity in the US, coupled with recent positive results for several of the tech giants, including those in the digital advertising space. This bodes well, and I'm cautiously optimistic that we're starting to see some green shoots for 2024 rebound. With our efforts on operational excellence and focus on value adding to our clients, We're in a very strong position to seize opportunities as they arise. With that, let me hand over to Mr Chin.
spk04: Thank you, Lohan. In Q2 2023, we delivered revenue of US dollar 126.2 million, up 5.5% year-on-year on a reported basis. Had the Singapore dollar remained constant against our operating subsidiaries' currencies from Q2 2022, revenue would have risen by 11.3%. The exchange rates used for the translation of the local functional currencies of the Malaysian Ringgit, Philippine Peso, Thai Baht, Japanese Yen, and Roman Bi depreciated between 3% to 9% against the group's presentation currency of Singapore dollar for Q2 2023 compared to Q2 2022. Moving on to profitability measures, EBITDA decreased by 2.2% to US$33.7 million this quarter, due largely to higher employee benefit expenses, which rose 7.1% year-on-year, higher than the revenue growth rate. Adjusted EBITDA declined 7.1% to US$32.7 million in Q2 2023, as margins contracted from 29.4% to 25.9% on higher infrastructure and employee costs. I will elaborate more on this in a later slide. Interest income increased six times with increased funds in interest earning deposits against the higher interest rate environment, while income tax expenses declined 24% with the reinstatement of tax incentive in the Philippines that was suspended in Q2 last year. Consequently, profit for the period grew 9.4% to US$21.6 million. Adjusted net income, which represents profit before equity settled share-based payment expense, net foreign exchange gain or loss, and acquisition-related professional fees were stable year on year. This was largely because we incurred lower equity-settled share-based payment expense in Q2 2023 compared to the same quarter last year. Let me next provide some insights of our revenue by service offerings. Our growth in Q2 was led by the sales and digital marketing line of business, followed by omni-channel CX services, but was partly offset by decline in content trust and safety. Revenue from sales and digital marketing services increased by 15% to US$33 million, driven by the expansion of existing campaigns by digital advertising and media, as well as e-commerce clients. Our newer client cohorts from 2022 continue to scale up, further contributing to the growth in this line of business. Omnichannel CX revenue rose 8% to US$76 million as a result of higher business volumes driven by the expansion of existing campaigns by clients in the travel and hospitality, gaming, FMCG, financial services, and tech verticals. Revenues from content trust and safety declined 19% year-on-year to US$16 million due to contraction of volume requirements by existing clients in the digital advertising and media verticals. partially offset by expansion in the travel and hospitality vertical. In summary, omnichannel CX made up 60% of our total business in Q2, while sales and digital marketing and content trust and safety contributed 26% and 13% respectively. Next, let me elaborate on the adjusted EBITDA margin movement from 29.4% in Q2 2022 to 25.9% in Q2 2023. In terms of margin impact, higher rental and maintenance, telecoms and tech expenses were offset by lower recruitment costs leading to a neutral impact. There was a 0.8% impact from general overheads, largely higher infrastructure costs linked to LP space expansion for new sites and higher professional fees incurred such as tax and legal fees. Thirdly, there is a 2.7% impact from high employee costs. of which the bigger factor is higher local support and shared service headcount. There is also some impact from higher headcount of deployed agents versus billable, as well as higher corporate costs. However, when comparing to Q1 2023, there was a sequential improvement of margins from 24.2% to 25.9%. This was due to an improvement in utilization in both the mature sites and new sites like Brazil, Turkey, and Korea, as well as an improvement of excess headcount compared to Q1 2023, with resources in Q2 2023 closer to our deployed agent headcount and man-hours. Let me next move on to the half-year performance. Our revenue for the six months ended 30 June 2023 was US$247.9 million, up 6.8% on a reported basis, or up 11.8% in constant currency curves. EBITDA was up 2% to US$65 million and profit for the period increased by 15.4% to US$41.7 million. This was driven by a reversal of equity settled share-based payment in Q1 2023, higher interest income as well as lower income tax expenses. Excluding the effects of the reversal of the share-based payment expense, adjusted EBITDA declined 11.6% to US$62 million while adjusted net income declined 9.9% to US$38.9 million. This was largely a result of increased employee costs and high overheads, in particular for the first quarter of 2023. Accordingly, adjusted EBITDA margins for first half 2023 landed at 25%, down from 30.3% in first half of 2022. To a large extent, much of the margin compression is due to planned costs such as our geographic expansion, choosing to recruit in good time, and keeping strong support and shared service staff ratios. For first half 2023, revenue from omnichannel CX rose 8% to US $148 million. Revenue from sales and digital marketing services increased by 19% to US $66 million, while revenue from content, trust, and safety services was down 18% at US $32 million. For the half year, Omnichannel CX contributed 60% of our business, while sales and digital marketing stood at 27% and content trust and safety at 13%. Lastly, let me provide an update on our full year 2023 outlook. We have revised the full year 2023 revenue growth range to 2% to 4% on a constant currency basis from 3% to 8% previously. As Lohan mentioned, some clients are taking longer to commit to business volumes. During Q2, one of our key clients also reduced their volume forecast for the remaining months of FY23. This means that there is a knock-on effect on the revenue numbers that we can put into our forecast of second half of 2023. Further, revenue was strong in the second half of 2022, which sets a high bar in terms of year-on-year percentage growth for the second half of 2023. In terms of adjusted EBITDA margins, we have trimmed the top end of our range, and our guidance for full year 2023 is now expected to be approximately 25% to 27%. We are committed to putting in the necessary investments and spending in the business for the long term and remain cautious in our cost optimization efforts with an eye on volume recovery for 2024. We have adjusted the margins outlook accordingly to reflect this. Against the backdrop of what we are expecting, we are re-strategizing our overheads approach to make it more elastic against revenue. For example, this includes planning infrastructure, spending closer to revenue pipeline. These initiatives will take some time to benefit margins, likely in full year 24. With that, let me hand you back to Lohan.
spk02: Thank you, Mr. Chin. We're ready to take questions. Hi, everyone.
spk07: Ladies and gentlemen, if you would like to ask a question, please press star followed by one on your telephone keypad. We now have our first question from Pang Bin from Goldman Sachs.
spk00: Hi, good morning, everyone, and thank you very much for the opportunity. Three questions for me, please. Number one, on the guidance and outlook, Can you please go over the rationale why you make this substantial change to your revenue guidance, especially if we're looking at your first half of the year on constant currency basis, you are up in the double digits. So what has changed? I'm sure you're talking about some of your clients, but can you go into specific details of that? On the back of that as well, what level of confidence and visibility you have on this revised guidance? Is there any possibility of further rewrites down going forward? That's question number one. Number two, you also mentioned that you started seeing signs of better 2024. Can you further clarify and provide more color on that? Have any of your clients started indicating that they will likely increase their spending into next year? And number three, lastly, can you share with us more around how AI may impact your business? How many percent of your business may see more impact comparatively, and how do you plan to remit the list here?
spk02: All right. Thank you, Phuong, for all these questions. So, yes, the revised guidance from 328 to 224, I mean, you called it substantial. It's not tremendously substantial, but it does have an impact. I do agree. So there's a few reasons behind this. The first one is the deals we were hoping to close got delayed. So really the velocity of deals have been slower than anticipated. Some clients who had indicated that second half was going to be stronger didn't really materialize. It got delayed even further, let's say into September. at lower volumes than initially anticipated. So that's one factor. We still have pressure from the digital advertising sector, which was not doing terribly well in the first half, but it's not going to do better in the second half. And that's taking into account as well that our second half last year was also quite a good second half. So that doesn't help us very much. And then, yeah, the opportunities are coming though, and we're a bit more optimistic around 2024 leading into your next question. I would say where clients are starting to indicate better forecasts in 2024, Nonetheless, I think if I come back again on the impact on the second half, which was the primary question you had, travel and hospitality is not really going to show up as much as we were anticipating. China hasn't really played out so well as we were hoping it would. So it's a whole bunch of factors, although We have sectors that are doing pretty well like gaming, tech, e-commerce, automotive for us are really doing extremely well and there's a whole part of the business that's growing at fast pace but it's being brought down by other sectors that are weighed in. Now, if you look at digital advertising, we see some good results announced by our key clients generally in the first two quarters. Unfortunately, we don't see it translated in immediate growth. So how long more do they need to produce better results until they decided to open the floodgates and decide to invest further is a question mark that we still have on our list. Having said that, we see some green shoots in 2024. We see that the recession fears are starting to subside, and we are seeing some also good momentum on our pipeline. We are closing deals. The leads we're getting starting in the second quarter are starting to turn around compared to the first quarter. So there's a number of encouraging signs. That makes us pretty optimistic, if not cautiously optimistic for 2024. Now, the last question you have, and one of the questions I think you have is whether there's a chance that we're going to revise our forecast again in the next announcement for Q3. We think we have a good sense of 2023 at this point. So any barring any unforeseen circumstances or something really major, we are pretty locked in that guidance at this point. The question on impact of AI, we've had very, very good momentum with TDCX AI, I have to say, and a lot has to do with the role we think TDCX can play as an advisor to our clients. And so we've had a lot of very successful discussions with most of our clients and successful engagements in consulting projects with them, some that we, I think, have explained earlier in the call. And really it's leveraging the possibilities that are available to us. In terms of impact, the first impact we expect from TDCxAI is strengthening our relationship, defending our territory, and really enhancing the business we already have with our clients to grow further, show them better productivity, better insights, better quality. And what's interesting, I would say in Q2, is we didn't anticipate to monetize TDCX AI so quickly, We expected it for a few years to remain a value add to our clients to do what I just said. But now we're starting to make commercial proposals as well with dollars associated with it. So there's a real appetite from clients, but we see real opportunities as a result of that. And one of the opportunities we see is a growing a total addressable market for TDCX. We see the possibility now to offer some of our services to the in-house call centers and operation, and that's a total addressable market that is three times the size of the outsourced CX market. So our total addressable market has has grown three-fold on the basis of that, or four-fold, because from $100 billion, we're moving into plus $315 billion, $415 billion. But there's also the consulting market TAM in the CX industry, which is another $30 billion. So we're talking about $445 billion as opposed to $100 billion. So there's a huge opportunity for us to... play in and TDCX with its very differentiated offering, being in Asia, working with the best clients in the world, we've got so much knowledge and capabilities that we can share as part of TDCX AI for this total addressable market that gives us a good confidence level as to the opportunities for us to tap these new trends that we hear a lot about. I hope that answered your questions, Tom.
spk01: Thank you.
spk07: Our next question is from Meghana Kandhi of CGSCIMB.
spk01: Hello. Hi. Thank you so much for the presentation. I just have a few questions here. First, the revenue contribution outside of your top five clients seems to have bumped up really well in Q2. So could you please share a bit more color on this? Are you seeing clients that have onboarded over the past year or two ramping up their campaign sales more significantly? Or are there any other standout performers that are moving the needle here? And my next question would be on the EBITDA margin guidance. So considering the lower adjusted EBITDA margin, should we expect this trend to be more cyclical in nature given the lower volume outlook in second half? Or is this more structural looking at the types of services that you're providing to some of the newer clients? Thank you.
spk02: Thank you very much for the questions. Yes, the performance outside of our top five clients is quite staggering and significant. very happy with that the whole goal of the company where we you know we have two strategies to diversify from our bigger clients which is build our new newer clients to outpace the growth of our bigger clients then the second one is on the M&E side continue to have a more balanced business so we've had great success bringing new clients for for the past few years and Some of them date back to 2021, and they started rather small, but they've now taken over the world. So we have a gaming client, for example, where we really started in one location back in 2021. And now we are in five locations. It's become a global client. It's been growing very fast in the gaming sector. We onboarded on the back of this another great gaming client as well. where we expect it's now operating in two locations. We expect it to grow in another location, so that's doing well. We onboarded as well recently a fast-moving fashion from Asia, and this client is growing super fast, but really extremely fast, so it's a star. for us in one of our locations in the Philippines. We have a digital advertising new client that we onboarded about two years ago that's starting to really deliver. So we just recently onboarded less than a year ago an automotive business and you know automotive is going through a bit of a revolution of a change of distribution model transitioning from wholesale and agents and distributors into an online model that creates tremendous opportunities for us. It's a global deal. So there are quite a few opportunities. But what I find super interesting as well is a lot of our, more and more of our clients are becoming originally from Asia. And there's a big trend where TDCX is able to attract the Asian superstars, the leading companies of Asia as part of our clientele, which really represent the future of the economy for Asia and for the world, actually, because they're not operating in Asia only. They've done their job of having a good market share in this growing territory. and they're taking over the world, and we're there to support them where they need us to be. Now we have 16 locations to serve our clients, so we've been making great progress on growing our location, so we're in a fantastic position and in a good place at this point. Maybe the second question, I think, is around the margins. both maybe the short-term and the long-term part of the margin. Maybe I'll defer to Mr Chin to talk to you about the margin, if you don't mind. Yeah, sure. Thanks, Laha.
spk04: So on the margin side of things, it is pretty much due to largely planned costs and planned investments and our continuing investment into the business. As a reflection of our geographic expansion that we have put in in the last couple of years. The building up of our AI arm that Lohan has alluded a bit a while ago, that also is big into the EBITDA outlook, as well as what happened in Q1 on our improvement going into Q2 about keeping our agents sizing in anticipation of the volume movement. which comes along with support and shared service staff ratios to deliver the best optimal outcome for our clients. And it's kind of reflected in Q2 that we are going to continue on that path going into the remaining months of the year. In that sense, we think that these investments are quite necessary. to put us in a healthy position to benefit from a possible macro recovery if it turns in towards the end of this year going into 2024. So on that basis, we do commit ourselves to putting in, as I said earlier on, necessary investment and spending for the business in the long term. rather than going on a quarter-to-quarter basis, remaining careful in how we optimize our costs, with an eye on volume rebound in 2024. But at the same time, against what's happening in the near term, we are also reprioritizing our overheads generally from what we had planned early on to make it more stay kind of elastic against our revenue volume in the near term so that our EBITDA stays on course of what we outlook. Things like infrastructure, capacity planning, decisions are still to be revisited to ensure that we don't stay too off course from the business side of things. So that's what It's happening now and also going into the remaining five months of the year.
spk03: Thanks, Mr Chin. We have some questions on the webcast that I can read out. Can you share a bit more colour on your business development pipeline? How is it coming along? And second one would be, you announced some share buybacks in Q2-23. Can you give more colour around that and your plans going forward?
spk02: Thank you for the question. Our pipeline is building up pretty nicely and What I like about it as well this year is we've gotten quite a bit of interest in a new sector that we haven't been really into, which is health tech. So we want two contracts in that sector in Europe, and then a third one in Asia as well. We have more coming up on the health sector as well, which is going to be an interesting development for TDCX to grow our opportunities for business. We see in Q3 the number of leads starting to get into the zone of the higher numbers than we've had before over the past two quarters. Good opportunities in still a lot of new economy companies as well. for us and as well I would say that what makes this year different is we're getting a lot more RFPs from existing clients and the deals we're closing as well have a much higher sales value than they did in the previous quarter. So our business development team that was recently restructured is doing a great job And that can only get better. So that answers the questions on the pipeline. I'll leave the other questions to be answered by Edward Goh, our head of corporate development. Sure.
spk05: Thanks, Laurent. On the topic of buyback, I think we've always said we're guided by valuation against our peers, but mindful on the impact of liquidity. But I think at current levels, definitely we're seeing very attractive I think sort of prioritizing really the use of our capital on this exercise. I think looking at just sort of our cash being $300 million still, that's about 40% of our current market cap. It looks like a very sort of a good level for us to continue to be more proactive in our share buyback program. So definitely we've sort of done some in the second quarter. of 23, which we purchased about 160,000 ADS over this period of time. So we'll continue to sort of adopt the same approach going forward. Thank you.
spk02: And if I can rattle on a little bit on the business development pipeline as well, just wanting to indicate a little bit of what we're seeing as potential trends that are going to impact us and drive more business for us Really the opportunity for outsourcing, which we think is going to fuel 2024. We're starting to see that clients who have laid off need to get things done, but they don't have the manpower, they don't have the capabilities. Even in the in-house market, clients don't have the capabilities because everybody's been going through the leaner exercise And the kind of inquiries we're getting from clients are becoming increasingly complex because those are the resources that they cut. So the second trend that we see also is the ever-rising expectations. As the world becomes more and more digital, the expectations are much higher. So some of our clients have increased their NPS expectations, their CSAT expectations. Increases come at a cost that can be mitigated through automation, but will require much more investment and effort, and that, we think, will be driving the price of the business and what we sell to our clients. and leveraging absolutely TDCX AI to help to drive that. So we see quite a number of positive trends at this point that can continue to power the business in 2024 and beyond.
spk03: Operator, can we have the next Question, please.
spk07: Sure. Our next question is from Jonathan of Philippine Securities.
spk06: Morning, management. Thanks for taking my question. The first is, could you give some update on the new geographies, Indonesia and Brazil? How has the progress been? Has the pipeline over there been as expected? And the second question would be on the key client that actually reduced volumes for you guys, or is reducing volumes. Can you give a little bit more color on them, you know, how much volume did they cut and how much expected growth was this in percentage terms? Thank you.
spk02: Thank you, Jonathan. So two zeros here, Indo, Indonesia, pretty new to us, so it's a At this point it's embryonic expansion. We're very early days in Indonesia but successful already with the client because our strategy for 2023 and 2024 will be to go in greenfield operations supported by clients as previously different where we were in some locations strategically investing but for several reasons. One that we already have quite a good footprint globally that we're trying to control our costs as well. Now we choose locations when we have business. So Indonesia was exactly that. So it's just starting but very successful at this point. Brazil is, I would call it a tremendous success. We started with a client. We have a bit more than 100 headcount now in Brazil. When I say it's a tremendous success because We were able to do this really in a very short period of time in Sao Paulo, that the business is performing super well for our clients, but that also we're getting a number of inquiries. And finally, because it's also completing the puzzle of Latin America, where we were in Colombia, we are in Colombia doing really well in Bogota. But it's difficult to have a Latin American strategy unless you cover Portuguese and Brazil, because Brazil is still a huge powerhouse in Latin America. Having the combination of Bogota and Sao Paulo makes it really credible and capable. So very happy with where this is going. Very happy also with our operational capability in terms of setting up greenfield sites. Over the past two years, we've done mostly 100% success in greenfield operations, which is a tribute to our operations teams. And it's super important for our clients to give us more business moving forward. So that plays around our agility. Now, going back to the second question about clients reducing volume, Yeah, I cannot give too much details about which clients. I'd rather give sectors. So as you would expect, digital advertising has been under pressure for the right or for the wrong reasons. I would say the sales and digital marketing a lot less under pressure. More the OCX and the content moderation were under pressure. And that will continue to be the case a little bit. fintech has also contracted yet we're seeing some rebound but more in the later part of the year so that's why our guidance is affected as well but that's giving us some some hope in 2024 on the fintech side i would say travel and hospitality uh we were expecting I would say a much better Q2, Q3 out of travel and hospitality. And is it mostly because China didn't show up? Is it because Japan is not traveling outside? There could be different reasons. I think maybe globally as well. But if it's not delivering the usual power numbers that we are used to. Nonetheless, our first half on travel and hospitality is quite spectacular nonetheless. And good is just that the second half is not tremendous. So that's what's going on, if I can say. We have other sectors like tech, gaming, e-commerce that's flying. So there are opportunities even in the financial services for us. So it's not all gloom. It's a mix of factors that are pretty sectoral, and the other sectors are doing well. I hope that answers the question, Jonathan. Yes, great. Thanks for that.
spk07: This concludes today's Q&A session. I will now hand it over to Jason for closing remarks.
spk03: Okay, thanks everyone for joining us on this call. If you have any further questions or need any follow-ups, please feel free to get in touch with us. On behalf of management, we're signing off. Thank you and goodbye.
spk07: This concludes today's call. Thank you for joining. You may now disconnect your lines.
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