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spk01: Welcome to the TDCX Q3 2023 results announcement. My name is Neil and I will be coordinating your call today. If you would like to ask a question during the presentation, you may do so by pressing star 1 on your telephone keypad. I will now hand you over to your host, Jason Lim from TDCX to begin. Jason, please go ahead.
spk08: Hello everyone and welcome to TDCX Third 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 that may not be realised in the future. You should not place 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 6-K, which is available on our website. We have prepared a convenient translation for Singapore dollars to the US dollar at the rate of US $1 to SGD $1.3648. 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.
spk00: Hello everyone and thank you for joining us today. Before I begin, I'd like to thank our team members across the TDCX global network for their exceptional efforts and our clients and investors for their continued trust and support. In the third quarter, TDCX delivered a solid revenue of $120 million, which is stable on a constant currency basis. We also demonstrated improved operating rigor as we delivered Q3 adjusted EBITDA margins of 27.8%. A testament to the success of our ongoing cost optimization initiatives, This compares with 25.9% in Q2 2023. Profit for the period was 23 million US dollars, an increase of 2.3% year on year. This means we are very much on track to meet our guidance for the year. I would say that the overall business continues to be strong and resilient. Notably, if you were to exclude revenue from our top client, Revenues from the rest of the business would have grown in the low teens percentage year on year for Q3 2023 compared to Q3 2022. This demonstrates a very healthy performance against the backdrop of a really tough operating environment, which speaks to the way we continue to deliver excellence for our clients. You can also see this across a few operational parameters. Firstly, we continue to register growth-based business growth as revenue from clients outside the top five rising 51% year on year. These newer clients, while starting from a smaller base, are growing quite steadily and continue to ramp nicely with us. Secondly, we continue to make progress in reducing client concentration and diversifying our business. Our top two clients contributed 47% of this quarter's revenue hence reducing our concentration by almost 10 percentage points from 56% in the same period last year. Thirdly, our business development efforts have yielded good results. Total client count rose 31% to 94 clients as of September 30th, 2023, with bright spots in some key sectors, which I'll speak more about shortly. And last but not least, our geographic expansion in the last two years continues to bear fruit, as revenue from new geographies grew five times this quarter compared to the same period last year. These indicators show that despite an uncertain backdrop, we are managing the business well while simultaneously achieving growth in earnings. Despite these improvements, the macroeconomic environment remains challenging. As communicated before, several of our key clients have reduced volumes during the year as part of their focus on cost efficiency. We're seeing the impact of these reductions against a strong Q3 last year, but these are within our forecast and expectations for FY2023. We're very disciplined with regards to cost controls. Furthermore, we have actively deployed our cash to drive higher returns. Our profit performance has translated into strong cash flows and a strong balance sheet. Cash generated from operations was 86%. million US dollars for the nine months of 2023. As of September 30 of 2023, we have 318 million US dollars of cash and cash equivalents with no debt on the balance sheet. Again, our strong cash flow generation and low leverage provides us with ample flexibility to pursue strategic growth as well as to enhance shareholder returns through a variety of avenues. We see great value in our shares at current valuations and have prioritized share buybacks as a form of enhancing shareholder returns. We were much more active in the market in the third quarter. From 1st July to 17th November 2023, we purchased around 930,000 shares. Since the inception of this program in March 2022, we have deployed more than $15 million and bought back around 2 million shares. We see this as an attractive use of our capital and believe that as growth returns, repurchases at these levels will create significant value. In terms of M&As, with our strong cash balance, we have the ability to move very quickly on targets that could help enhance our capabilities or reach to better serve our clients or to accelerate our growth. Additionally, we have the financial strength and flexibility to allocate capital to strengthen our organic initiatives such as TDCS AI, our consulting capabilities, and reinvesting in our business. This quarter at TDCS AI, we have accelerated our progress in deploying AI solutions for select clients while continuing to refine other pilot AI initiatives to boost internal productivity. Let me outline another use case that we launched this quarter to showcase how we help clients solve major pain points. For sales campaign for large digital advertising clients, we built an AI-enabled sales catalyst accelerator to enhance outreach success and to maximize customer engagement in our sales and digital marketing programs. Our team took our treasure trove of historical contact data sets and overlaid them with additional data, such as interaction notes and customer profiles, and we trained the model to predict and identify the optimal moment for a marketing specialist to carry out a marketing plan review. This improvement boosted their reach by 20 to 40%. With a higher reach, our marketing specialists were able to assist users in a more timely and strategic manner and significantly increased monetization for our digital advertising clients. This is a good example of where TDCX establishes our right to play as a strategic advisory partner to clients who are looking for actionable ways to gain incremental productivity and efficiency within their campaigns as they come under pressure to do more with less. Through TDCX AI, we leverage our deep operational experience as CX practitioners and our tech stack to better understand clients' pain points and advise and implement feasible solutions to drive improved outcomes in their campaigns without losing that human touch. This is ultimately what clients have always come to us for. Most of our campaigns, which involve complex tasks that require humans in the loop, we believe will benefit from the productivity gains AI provides and will help us scale the business to even greater heights. We have won some very exciting clients during the quarter as total client count rose to 94, a 31% increase year on year. Our domain expertise in key verticals and strategic footprint in APAC continues to shine through. The clients we launched in Q3 included one of the world's most popular mobile messaging apps and a leading global airline based out of Asia, both of whom have the potential of ramping meaningfully with us. Our client count does not include a further four clients that have been signed but not yet launched, which include Southeast Asia's leading super app providing everyday services, as well as a European medical device manufacturer. Such wins are testament to deep domain expertise that we have built over the years, such as for social media platforms within our digital advertising and media vertical, in travel and hospitality, as well as in sales and digital marketing. We have also made forays into innovative verticals, such as health tech with two clients, which we are pretty excited about. For one client, TDCX will be providing customer support for patients with specific medical needs, and for the other, helping medical practitioners understand how to use sophisticated medical devices. CDCX's ability to break into new verticals such as health tech stems from our specialization in managing complex customer interactions and the ability to deliver excellent CX outcomes. With a higher client count and broader growth, we have improved our client concentration profile, with top two clients contributing 47% of revenue compared to 56% in Q2 2022, while top five clients contributed 71% of this quarter's revenue, down from 82% in the same period last year. In terms of contribution from verticals, digital advertising and media now represents 43% of our business and remains pressured by softness from our largest clients. We see some bright spots in travel and hospitality, our second largest vertical at 29% of revenue, which grew 8% year on year, demonstrating a stabilization of the travel sector with a runway for longer-term growth as we bring more clients in this vertical. E-commerce and gaming are also doing very well, growing at an incredible clip of 63% year on year, and 110% year on year, both reflecting the underlying strength of these sectors. I'd like to emphasize at this juncture that TDCX is unique amongst global CX providers with over 70% of the business focused on serving Southeast Asian and North Asian languages, serving complex business needs. Since 2021, We've expanded quite rapidly, adding nine new geographies to our global footprint, including Colombia, India, Romania, South Korea, Hong Kong, Turkey, Vietnam, Brazil, and Indonesia. Our new geos have been scaling well and revenue in Q3 2023 was five times that of Q3 2022. We are happy with our strategic footprint now, and we will be focusing on growing and stabilizing these new sites generating better economies of scale and progressively improving their margins. Korea has been one of our top performers in terms of new sites revenue expansion and continues to do well as we add more headcount and deliver on customer satisfaction scores. In Indonesia, we recently launched on the ground with a large social media client. It's early days yet. We are excited about the market's potential. In Vietnam, we are delivering top of the network scores for a client launched a few quarters ago, and we are in active talks to sign up another client. These are positive developments, which really gives me confidence that our footprint in Asia will only continue to strengthen. Some updates on LATAM as well. Earlier this year, we launched our first campaign in Sao Paulo, Brazil, a pivotal step in our journey, and our team has continued to grow ever since. We have delivered what the clients have called their smoothest launch to date. And we're now one of the top three performing sites globally based on customer satisfaction. In Colombia, we expanded our customer service support team with a very innovative robot assisted food delivery service. And we continue to receive interest from clients looking to launch in the region. Beyond delivering value to our clients, Our goal at TDCX is also to ensure that we provide the best employee experience to our global TDCX team members and continue to attract and retain the best talent. I'm extremely proud of our engagement teams who champion a vibrant, multicultural, and joyful work culture. And seven of our campuses are Great Place to Work certified among the many other industry recognitions celebrating TDCX. In closing, we remain super focused on executing and delivering excellence for our clients, and the results can be seen in many of the indicators that we shared earlier. Over the past nine months, our nimble and agile structure has allowed us to pivot quickly, strategizing to make overheads more elastic against revenue, which in turn has contributed to margins improving. We have also made good progress on the AI and consulting front, which really helps to position us to be the ideal outsourcing partner for our clients. Moving forward, we will continue to invest for growth while at the same time managing our costs carefully. While we are focused on some of these immediate priorities, I would like to convey my confidence on TDCX differentiated footprint domain expertise in doing complex work for key verticals and strong track record in developing client-vendor relationships into key strategic partnerships for large global enterprises. We see green shoots in 2024, but it also appears that the global macroeconomic environment is not out of the woods yet. So we'll have to be very careful and robust with our guidance when it's time to do so during our Q4 results announcement. With that, let me hand it over to Mr. Chip.
spk05: Thank you, Lohan. In Q3 2023, we delivered revenue of US$130 million, which is stable on a constant currency basis. On a reported basis, revenue is now 5.4% year-on-year due to the strengthening of the Singapore dollar against most of our operational functional currencies. This was driven by a decline in required volumes for some of our key crimes, resulting in lower revenue from our top five crimes combined. Our clients outside the top five continue to grow strongly, rising 51% year-on-year, which is in line with our continuous measures to broaden our customer base. This has improved our customer revenue diversification, as Lahan had shared earlier. Adjusted EBITDA declined 9.1% year-on-year, and we delivered margins of 27.8% this quarter, compared to 29% in the corresponding period last year. As shared throughout the earlier part of this financial year, we have continued with investment expenses to grow our business, including entering into new geographies and building new capabilities such as TDCX AI. As part of our planned geographical expansion strategy, we incurred higher rental and maintenance expenses with the setup of free field sites, as well as higher telecom and technology expenses to support campaign volume requirements at both existing and new sites. That said, our cost management and productivity initiatives have started to show results, as adjusted EBITDA margins have improved sequentially from Q1 2023 through to Q3 2023. I will share a bit more on this in the next slide. In Q3 2023, we recorded higher interest income from increased placement of cash in interest earning deposits compounded by the elevated interest rate environment. We also recorded lower income tax expenses from the reinstatement of tax incentives in the Philippines that was suspended temporarily last year, lower profitability of few key operating units, and the non-recurrence of the one-off prosperity tax in Malaysia that was instituted in 2022. As a result, coffee for the period grew 2.3% to US$23 million. Adjusted net income which represents profit before equity settled share-based payment expense, net foreign exchange gain or loss, and acquisition-related ex-professional fees rose 2.2% year-on-year. We have reported sequential adjusted EBITDA margin improvements from Q1 to Q3, which demonstrated the effects of our focus on cost optimization and improving productivity and efficiency. Adjusted EBITDA margins rose from 24% in Q1 2023 to 25.9% in Q2 2023 and up to 27.8% in Q3 2023. Throughout the course of the year, our efforts to right-size headcount against business requirements has started to bear fruit, resulting in better employee cost efficiency. Secondly, as our new geography started to launch new campaigns and generate revenue, This also helps increase utilization as a new site and deliver better economies of scale as we move through 2023. Let me next provide some insights of our revenue by service offering. Revenue from omni-channel CX Solutions services decreased by 3% to US$72 million, primarily due to a contraction of volume from a key client in the digital, advertising, and media version. We were able to partly offset this with higher business volumes in the travel and hospitality, gaming, fast-moving consumer goods, financial services, technology, and e-commerce verticals. Revenue from sales and digital marketing services increased by 3% to US$32 million due to the expansion of existing campaigns by key digital advertising and media clients, and scale-up contributions from new clients secured in 2022. Revenues from content, trust, and safety declined 30% year-on-year to US$14 million due to downward revision of volume requirements by an existing client in the digital advertising and media vertical, but was partially offset by expansion due to travel and hospitality. Because we only have two clients in this segment, it is more susceptible to swings due to changes in orders. There continues to be good opportunities within the content trust and safety sector which we are working to tap. In summary, Omnichannel CX made up 60% of our total business in Q3 while sales and digital marketing and content trust and safety contributed 27% and 12% respectively. Much of the swing in this quarter was driven by movement in volumes of an existing large client. If they exclude the key client, we delivered double-digit percentage growth across all three service offerings. Let me next move on to our year-to-date performance. Our revenue for the nine months and the 30th September 2023 rose 7% on a constant currency basis. Due to the impact of the strong Singapore dollar, reported revenue was up by a lower 2.5% to US dollar $366 million. We delivered strong earnings growth over the nine-month period as profit for the period rose 10.3% to US$65 million. This was driven by a tight focus on cost optimization and further boosted by a net reversal of equity settled share-based payment expense in Q1 2023. Margins were down year-on-year as we continued with our planned investment into new geographies and new capabilities. In particular, in the first and second quarter of this year, we had opted to keep strong support and shared service ratios, which impacted margins during the early part of the year. Margins have since improved sequentially quarter to quarter as shared earlier. Excluding the effects of equity federal share-based payment expense, adjusted EBITDA declined 10.8% to US dollar 95 million due to the lower margins year on year. Adjusted net income declined by a lower 5.8% to US$62 million, aided by lower taxes and higher interest income. For the nine months of 2023, revenue from omnichannel TX rose 4% to US$219 million. Revenue from safe and digital marketing services increased by 13% to US$98 million, while revenue from content, trust, and safety services was down 22% at US$46 million. due lastly to a drop in volumes from a key find in December. For the nine months of 2023, 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 delivered a resilient set of results in line with our guidance. For the nine months of 2023, we have reported a 7% growth in revenue in country currency curves and adjusted EBITDA margins of 25.9%. Based on the near-term visibility of revenue in Q4 2023 that reflects confirmed volume requirements expected operational delivery and seasonality, and barring unfortunate significant events, we are reiterating our full year 2023 revenue growth range at 2% to 4% on a content currency basis. We also reaffirm our full year 2023 adjusted EBITDA margins to be approximately between 25% to 27%. We will share FY24 guidance when we next report our Q4 and full year results. With that, let me hand you back to Jason.
spk08: Thank you. Thanks, Mr. Chin, Lahorn, for the presentation. We are now ready for the Q&As. May I ask that you limit yourself to three questions at each round, so we have a chance to take down the questions. Operator, please.
spk01: Thank you very much. Ladies and gentlemen, if you would like to ask a question, please press star followed by one on your telephone keypad now. If you change your mind, please press star followed by two to withdraw your question. When preparing to ask your question, please ensure your phone is unmuted locally. Thank you. And now I have our first question from Kaysion from CS. CGS CIMB. Please go ahead.
spk07: Hi, good morning, management team. Thanks for taking my question. I have three questions here. The first one is regarding the revenue slowdown in the first quarter of the year. This seems to be mainly driven by your top two customers. Based on my rough calculations, it seems that the revenue has fell 20% year-on-year here. Can you share more on what's happening here that results in such a drop? Question number two, I think Menta showed a return to growth for his digital advertising in the latest quarter. Why hasn't that translated into your numbers? And based on your latest discussion with them, when can we see contributions from digital advertising clients returning to growth? Third question, I think we see some bright spots here in terms of X top five client performance. Maybe you can share some more colors on this. That would be very helpful. Thank you.
spk00: Thank you, Casey. Appreciate the question. I'll answer both the revenue slowdown and the bright spot within the same answer, then I can talk about any growth implied or announced by our digital advertising clients. So in terms of revenue slowdown, really this is what was expected and the reason we revised our guidance back in August. So some key clients, particularly our large digital advertising client has cut volumes. But if you exclude that top client, our revenues across all three segments would have grown in low teens. The clients outside the top five are still growing very well at 51% from Q3 23 to Q3 22. But the impact, as you know, from the bigger client is the one causing that slowdown. So we're really in a situation where we have almost two different companies here. One that's being impacted by some large clients who are restructuring, looking for efficiencies. And then we have a mix of new clients and existing clients who are growing at a very fast pace. And so we have to manage that operationally. In answering the brighter spots question, We've brought in some exciting clients. We have some verticals that are doing well for us. Travel is performing. Gaming is exploding. Tech is doing well. Health tech is a new sector, so that's exciting. I'm excited about the global messaging platform that we've brought in, which has a great potential. And it's a multi-purpose service that we provide, whether it's B2B support, technical support, but also content moderation. Another client in the e-commerce side from Asia. Another social media company that we're working with from Asian footprint, but also global footprint. Asia's preferred super app and more gaming. A new airline that we're bringing in as well. So quite excited. One of our tech clients as well has some potential to grow. So it's more about the quality of those clients that excites me and that I see as a bright spot. Now, in terms of the second question about the digital advertising clients announcing better performance, yes, it's good for them, and we're very happy, of course, to see this. It's, however, a bit difficult to connect and map this with us. You know, we don't own 100% of their business. a percentage of it in specific service lines, specific geos. So from day one, and I think now we've been, what, public listed for the past two years, we've had difficulties really connecting the dots between their performance, the macroeconomic performance, and our performance, because a lot of things get in the way. But if you want to also look at the Q4 outlook, they've remained a little bit cautious as well. So it's not impossible that those clients are not pressing on the accelerator pedal right now, watching and planning for next year. So from quarter to quarter, I wouldn't jump into making predictions. Watch it carefully and then see how things pan out next year. So I have, however, a sentiment that we've been under a situation where there's been a lot of management reshuffle over the past 12 months. a bit of paralysis in making decisions that should be normalizing, and I could expect that maybe clients are looking at 2024 with a bit more stability, strategy, planning, and decisions. So that's what I'm thinking of. I hope that answers the question.
spk07: Thank you so much.
spk03: Thank you very much.
spk01: Thank you very much. We now have our next question from Ranjan Sharma from J.P. Morgan. Please go ahead.
spk04: Hi. Good morning, team, and thank you for the presentation. Just one question from my side. The head count has come down. How should we think as about a growth opportunity. I mean, could this be a leading indicator that you expect revenues to be under pressure in the coming periods as well, that you are reducing the headcount? Thank you.
spk00: Thank you, Ranjan. Look, the headcount reduction is absolutely directly related to the reduction in business volume. As we announced, we are minus 5.4%. So that translates into reduced headcount invariably. So again, we have to be careful to look at it from quarter to quarter and not make predictions. Q4 will also be a different quarter than Q3 was. There's some seasonality. So if I look at the headcount, I look at it from where we've been. And, you know, we have quite a bit of flex in terms of hiring fast and also... reducing our headcount fast as well. So yeah, I wouldn't put that as your leading indicator into reading into 2024, which I assume what you're asking right now. So we usually right-size according to the business volumes, and that's one of the strengths and reasons why clients come to us, right? So it's really direct correlation between revenue
spk04: and headcount sizing for tdcx well thanks for all i mean i mean i appreciate that you've done a very efficient business but what i'm grappling with is that if you were expecting revenues to pick up would you still cut headcount so and the quality of that called the corollary to that is that if you're reducing headcount then you would expect revenue revenues not to pick up in the in the coming periods
spk00: I think we were sticking to our guidance of revenue for 2024. So, you know, we report to you the headcount we had in Q3, which we were cutting because we started cutting before Q3 so that it looks like we have less headcounts so that we meet our targets and meet our clients' requirements. But it's not like we're cutting headcount continuously It's not a program of layoffs. It's right-sizing. So that's a continuous operational method that we've been carrying out. And as the business picks up, we'll be hiring more. So that's the logical, typical mechanics. I hope I understand and answer your question correctly.
spk04: Thank you.
spk00: Thank you, Ranjan.
spk01: Thank you very much. We now have our next question from Han Tan from HSBC. Please go ahead.
spk09: Thanks, management. Could I ask how much of this quarter's beta margin improvement you attribute the FX effect versus the other effects you mentioned like utilization so if fx turns do you expect some pressure to these margins mr chin maybe could answer this question yeah your question centers around uh how much is fx and how much is yeah How much of quarter-on-quarter EBITDA margin improvement is FX versus other factors?
spk06: I would say not an awful lot because the FX in Q2 to Q3, the movement was not as apparent in the earlier two quarters or earlier first quarter. So I would say it's to a lesser effect on that front, but more of the utilization costs, right-sizing effects of the headcount deployment and better, I mean, enhanced performance due to the right-sizing of headcount, calibration of people according to the business demands. it will carry more weight on that front, more effect on that front rather than the effects which though it has a bit, it is not the main core issue for the period.
spk09: Okay, thanks so much. I think my next question is on the water reduction in headcount. Is there a way that you could provide colour in terms of geography or segments?
spk00: We don't really give a breakdown here, depending on the GOs, but if I can maybe take your question a little bit further and say that some of the clients have also been looking for cost reductions and have asked to move from some more expensive locations to lower cost locations. The good news is we have now a network of 16 geographies with different profiles and capabilities from a language and pricing and technical capability point of view. And we can offer these options, which was, I think, two years ago, not the case. So we're pretty well shielded and ready to deal with those challenges. But yeah, it depends really. It's not uniform across the board. You have Look, we have the new geos who have grown five times compared to last year's. That's nine different countries out of 16. So you would expect that those have progressed in terms of headcount, whilst the legacy larger geos where we operate from have been under a bit more pressure. And not all of them, some of them. I hope that answers the question.
spk09: Then on that point on shifting to lower cost locations, has that been a headwind to top line and if so, how much?
spk00: Yeah, it is definitely a headwind. It's unavoidable as a headwind to the top line. I cannot share the amount, but it's not terribly significant. It does have an impact, but it's not... probably worth mentioning in terms of value, but it's a natural progression of the way we're rebalancing demands in a tough market environment. The macro is challenging, clients are quite price sensitive, and we need to be able to offer them solutions. But it's training pretty fine and within our guidance once again for this year.
spk09: If I could just squeeze in one question, could I ask about lead time to sort of between headcount additions and ramp up? Has that timing changed since two years ago?
spk00: No, no. This is still the same cycle of recruiting is more or less the same and the impact on revenue growth. follow. So no major transformation here within our operational model. Got it. Thanks. Very helpful.
spk03: Thank you, Han. Okay. Thanks, Han.
spk08: I think next we have a question from Jonathan Wu via the webcast. Moving into 2024, can we expect revenue growth from your larger clients to remain relatively muted and overall growth to be driven by newer or smaller clients?
spk00: Thank you, Jonathan. So, well, it's early days at this point, and I cannot comment really into how 2024 will look like, and we'll provide our guidance at the four-year results soon. We are absolutely working on our forecast right now, discussing volumes with clients and planning. As you know, those large clients have a quite significant chunk of our business, so definitely if their growth is muted, then we'll be impacted, but it's too early to comment on this. Other clients that we have, the smaller ones, same thing. I don't want to commit at this point, although they would have logically a faster growth profile than the top two and top three. So it's a bit early to talk about this, but that's as far as I think I can go at this point.
spk01: Thank you very much. As a reminder, ladies and gentlemen, to ask any further questions, you can press star followed by 1 on your telephone keypad now. We now have a follow-up question by Casey Ong from CGS CIMB. Please go ahead. Hi. Thanks.
spk07: In terms of guidance for FY23, I observed that you decided to keep your full-year guidance of about 2% to 4% in constant currency terms. I noticed that in nine months this year, revenue growth on constant currency terms was already about 7%. So is it more of a conservatism, or are you expecting further weakness in fourth quarter? Thank you.
spk00: Thank you, Casey. No, I think we planned this pretty well. And as you can see, the first half, we were up 11%. But the third quarter, we're down 5.4%. So we're pretty well tracking within the guidance that we've given, 2% to 4%. So this is a year where the first half was stronger than the second half, and I guess every year is different, and we adapt depending on how our business evolves, how our clients are behaving, how the macroeconomic environment behaves, but that's more or less the picture. So I think we're reiterating that guidance of Q4, and I guess you can draw your own conclusions as to how Q4 is going to look like.
spk07: got it and just uh wondering in terms of ai uh yeah can you talk a bit more about the latest uh monetization of this opportunity yeah uh yeah any color will be helpful thank you great thank you for the question so quite excited here we are pursuing our journey with the tdcx ai making great progress
spk00: As expected, as I said before, we use TDCX AI as a strategic advantage to strengthen our relationship with our clients, especially the larger clients. And so we are continuously investing in that space. We've brought in two new professionals into the mix, whom I'm very happy with. And we've continuously engaged with our clients. We continue to build interesting products and prototypes. And I mentioned one of them in the call in terms of helping to accelerate our sales on digital marketing. But one that got me very excited as well was one with GenAI that we've done with OpenAI. on knowledge base that we've improved from one of our airline clients and it's a very exciting use case at this point in terms of seeing the value it brings in adding more speed to proficiency. Monetization is still a long way away if you want it in terms of value. But we're looking at different ways to monetize. One, charging clients for strategic consulting fees, and we're seeing some traction in that possibility. Sharing of productivity gains over time, getting into outcome-based pricing models, but also helping our employees to be more efficient. and relevant to where we think the world is going to turn, which is going to be having to do more complex transactions. And as I said, from the day we went IPO, automation will rid the business of the simple tasks and will continue to drive the more complex tasks to humans in the loop. And so we focus on that. And so, yeah, I'm happy with that. I'm always never happy enough. It could go faster. But we're in a good place, and I think what I like about is really the strategic intent not to confuse ourselves with an IT company, but more as a CX strategic advisor leveraging AI for our clients in general.
spk03: Got it. Thank you. Thank you, Casey.
spk08: Thanks, Casey. I think that's all the questions we have on the call today. If you have any follow-up, please feel free to reach out to Investor Relations. On behalf of management, thank you for your time and for dialing in. Goodbye and have a good day ahead.
spk01: Thank you very much. Ladies and gentlemen, this concludes today's call. Thank you for joining. You may now disconnect your lines.
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