Naspers Ltd

Hello, partners. How are you? Welcome to our results call. I hope you received and you enjoyed our results today. I'm quite excited to what we shared today. At the same time, we could share a little more about our growth. Not only that we are growing 20%, but even more important, that our ecosystem thesis is working. So I enjoyed very much to share the numbers of Despegar. It's not only 5% of Despegar revenue coming from the iPhone ecosystem, but we share the data week by week. You can see a very strong growth. I'm quite confident we'll get to 10%, 15% in the short term. So this is the base of our thesis, our ecosystem thesis. We are growing very fast in iPhone, but we're pushing Despegar to grow together At the same time, we could share a little of our numbers in terms of results. You saw it grow 70% to $530 million. I think it's great to share this number with you. One year ago, I told you I expect us to have more profit than a decent dividend, and I expect us to get to multiple billion dollars of profit. And many people said, I can't see process doing that. So hope you can see profits doing that today. We are going to get between $1.1 to $1.2 billion in profits in EBITDA this year, excluding JET and Nascent Val. So we can expect $1.2, $1.3, $1.4 billion of EBITDA this year. And fourth floor, total billion dollars of profits in the next few years. So I'm quite excited about our numbers in terms of results. We keep the discipline. We sold 1.2 billion, but we are on track to sell at least $2 billion these years of our assets. We keep our buyback. Now we bought back more than $40 billion, generated more than $60 billion in results. So I think we keep the discipline, we keep the growth, but I want to reinforce, all of that is the foundation to how we are going to build a much bigger company. So innovation is growing amazingly with our process. I wanted to do a bigger session on innovation now, but because of the timing, we decided to focus on numbers today. But in a few weeks, by December 15, maybe January 15, we are going to make a much longer presentation on how AI is changing our lives in terms of life and commerce models, in terms of assistance. You saw we had 20,000 assists already. So I could talk a lot about innovation. I hope you'll make questions about that. It's quite exciting. So, our moment now is execution, execution, execution. We have some discipline also in M&As. A few M&As are focusing growth. For example, the Indian ones, Ixibo and Hapdo, they are growing, Hapdo is growing more than 120% year over year. We are very excited about that. A few M&As are increasing our profitability, like La Central, Jet, and Despedar. So I think the company is doing good. I'm excited about the results. Hope you have many exciting questions for us today. And my priority now is to execute both of those few billion dollars in results. We are just getting started. We really want to build at least $100 billion outside of Tencent and one of the best tech companies in the world. Let's talk more about that today. So let's go for our questions.

Mr. Owen, Ray and Gaida, speaking of just getting started, let's get started on the Q&A, shall we? Catherine, why don't you, if you could, remind the audience how to ask a question, please, and then I'll start off with a quick question. Please, Catherine.

Ladies and gentlemen, we will now begin our Q&A session. If you have a question, we ask that you please use the raise hand function at the bottom of your Zoom screen. Once called upon, please unmute your audio to ask your question. If you have joined via a phone line, please press star 9 to enter the queue and star 6 to unmute once called upon. For those of you watching on the webcast, if you would like to submit a written question, please type it in the Ask a Question tab to the right-hand side of the player. I will now hand back to your host, Owen Ryan, to take your questions.

That's great, Catherine. Thanks very much. It's great to be here today. It's good to hear from you guys. As you said, Fabricio, I think we're following through on our commitments. One such commitment was investment in our ecosystems. The biggest investment today has been JET, and I think it's on the minds of most investors. So can you give us a little update? We're a few days in since the delisting of JET. What's the future look like?

Let's talk about the GEX, Alejo. First, we closed the GEX transaction completely a few weeks ago. But just last Monday or Tuesday, we changed the management, the supervisory board. So now I and a few other people from Brussels are part of the supervisory board of GEX for the last six days. So what I can tell you, we are very, very confident. As you saw, we shared lots of data on DeskPagar, how it's growing, how we are working on the ecosystem. On JET, we have just six days, so it would not be appropriate to share today. What I can tell you, first, we are, this week, working a lot with JET on a key set of culture to enable the company to think big, move faster, and grow a lot. JET is not growing over the last few years, as you know. Obviously, we know that, too. I'm very, very confident that together we deliver a company that grows faster and is much better. The first big thing is on culture. It's happening right now that we're planning on JETS. That's why I couldn't add the numbers because we need a few more weeks to have a project for JETS. At the same time, our focus besides culture, and again, you saw me here last week on pros, the results we have today is because of the change of culture one year ago. Besides of culture, technology and product are the three big areas of energy of our reforms. On technology, we need again to move faster and to make sure JET becomes a more tech-first company with first-class technology in the world, using AI to take all these decisions. On products, we have to make sure that a few areas that JET is a little behind, we move faster. For example, loyalty program that is for Latin America, but it's not ready here in Europe. So we are going to push those three things. Hopefully, in general, we have a few results to share. Today is still too soon. But I can tell you that JET is not performing well. We all know that. But the level of confidence I have that you have a company growing again and competing very well is very, very high. And probably, you know, I like some letters from the CEO. Maybe we share a letter from the CEO where we can share more info on JET. But we have more specific questions I can answer today.

It's the holiday season for letter writing, so maybe you can write one to investors there after. Okay, well, thanks for that. I'm sure there'll be some follow-up questions on that throughout the call. But let's open it up to the audience, and I think the first question is coming from Will Packer at BNP. Will, your line's open. Make sure that you're on mute.

Hi there. Many thanks for taking my questions. Two from me, please. Firstly, Fabrizio, you talked to optimizing the buyback in your prepared remarks video. Could you help us think through the implications of that optimizing? Is it the current buyback run rate of $6 to $7 billion as the new normal for FY26, 27 and beyond? Or should we think of you cutting the buyback? And then it sounds like it's fair to assume that there's going to be some flexibility of funding, perhaps away from Tencent towards Mate One and free cash flow. In terms of my second question, the global... Online classified share prices have sold off sharply in recent weeks, following the OpenAI Developer Day and Rightmoves AI profit warning. For Fabrizio specifically, GenAI is central to your vision for the group. How are you thinking about the risk and opportunity for classifieds in terms of GenAI? Does this recent sell-off make the sector an increasingly attractive potential use of your M&A firepower, or would you rather see the dust settle first? Thank you.

Thank you, Will. Thank you for the questions. First, you asked about optimizing the buyback. You have lots of good numbers there. I don't want to repeat all of them. But in general, as you said, the buyback is more or less $6 to $7 billion this year. We have an open buyback. We are going to keep an open buyback the way it is. I like buybacks because I think if our company is cheap, we should be investing in our own company and increasing the value of the shareholders that want to stay. So we are going to keep doing that. On the other side, I think the company we have today is a very different process than it was two, three years ago. Remember, again, one year ago I said we were going to get to multiple billion dollars of profits. Many shareholders didn't see it coming. It is coming, but hopefully you can see that in the numbers that we are sharing today. So Produs is on a different moment. The discount is on a different moment. Tencent is on a different moment. I'm a big fan of Tencent. I think Tencent is going to be a big winner in the AI race. Tencent is positioned for that in China, and if you compare the multiples of Tencent versus everything else in the US, there is a lot of space for Tencent to keep growing. So, it's exactly what I said, it's optimizing the buyback. We are going to keep the open buyback as we have, but I'm not going to say the names of other companies. People have to be able to name other companies. I can tell you that there is another company in our portfolio that we believe has smaller growth potential than Tencent. growth and strategic potential and tencent. And yes, we are going to sell these companies and use this money also to keep a buyback. So what we are going to see is optimized exactly that. Eventually the buyback is, I don't know, one billion maybe, half a billion is for tencent, half a billion is for other companies that we can sell and use the cash to... I think the right word, the word I use is to make a better capital allocation. which is the number one company in China, growing fast, well positioned to win in the AI race. It's not the best decision to me to sell Tencent, even if we increase the value per share. So if I can optimize it, selling other things and increasing our participation, that's what we intend to do. We expect it to sell at least $2 billion this year. And how can I say... You can expect that we are going to do buybacks using other sources of density.

Just to remind you, although we are selling our density stack on a per share basis, we've actually increased our exposure to density, and by augmenting the share buyback with the other proceeds from other divestments, compared to continuing on the current path. So, I think that is a critical way of how we can further enhance the ESG environment.

For example, there is another company that we believe has less focus today than they should. We could sell a company that we believe has less focus and invest more or sell less of a company that we believe are performing well, has less focus, and we believe are going to win the Chinese market. So, that's what I mean by optimizing.

Those companies are the companies you're talking about as the additional $2 billion, right? Just to be clear. At least $2 billion.

And we already sold $1.2 billion. We've sold at least $400 million. And can we use this money to offset, let's say, $1 billion for other companies? Yes.

That's something we've seen from the group in many years, the more active portfolio management.

Yeah, the buyback was 100% automatic. That's what I don't like. We should sell. The second question was on AI and classifiers, you said. Many people sometimes ask me if I think, not the first one this week, if I think AI could have impact on classifiers. My answer is, it's much bigger than that. I think AI is going to have impact in classifiers, on e-commerce, on food delivery, in investing, in analyst reports from banks. AI is going to have impact everywhere. Obviously, as you know, the market today is a little too heavy, so everyone looks like an AI winner. But there will be AI winners that will create trillions of dollars of value. Not only trillions of dollars of cost, but trillions of dollars of value. And this is going to happen. How do you see that declassified? The point here is not if AI is going to hit your industry or not. Because if you think AI is not going to hit your industry, you are wrong. It will really hit all industries. is how we play our game on that industry i think what we are doing here in bronze is very very good we are not like you said some other company or you said some some classifiers with now other classifieds Classified was a business where people were, how can I say, surfing the high profitability without investing enough in technology. That's not our approach. Produs as a group is investing in large commerce model to understand the customers better than itself, and to create and improve our companies. We invest in a lot of content agents. We have more than 20,000 content agents doing everything, including many things on classifieds. We invest in a lot of inventory. a venture capital that invests in everything. To invest in companies that can make our ecosystem run better or in companies that can run better because of our ecosystem. So these three areas have profound impacts in our classified business. We are using the large commerce model to run better classified business and ads. On agents, we are running lots of our services through agents. For example, taking care of customers, taking care of retailers. Remember, our classified is less horizontal, more focused in real estate and and jobs and autos, thank you. So we are taking care of the autos, retainers, and our partners. And third, we are investing in early-stage AI companies that are better in growing in classifiers. So we can make these companies grow faster, and we can also make our classifiers not only keep growing, but disrupt other classifier companies. So yes, AI will have impact. I think Broadus is very well-positioned about that. Because everything we are doing, we put on hold for one hour, but part of our positive results, not because we are lucky or because our market just grows, because we are selling better, we are reducing the cost of ads, we are increasing the efficiency of the company, we are reducing the requirements for hiring people because our agents expand our working capacity. So, we are doing a lot of classifieds. For example, let's remember one thing. We just invested in one company that are automating through agents the relationship between real estate and their customers. We are doing that by ourselves and we invest in a company that is growing like 300%, doing the same thing. Our classified is very well positioned to use AI as a competitive advantage. So, that's how I see AI in Broads.

Hi guys, can you hear me okay?

Yep. Perfect. Good afternoon. I've got two, please. First one is to follow up on Will's question on optimisation of the buyback and to understand how it relates to where the discount is at a given period of time. It's been observable that the cadence of buybacks has slowed down in the last few months as the discount has stayed in that kind of high 20s, 30-ish percent zone, depending on the definition of the NAV. So should we kind of see that as a signal that the company feels there's less attractive opportunities in buying its own shares relative to the rest of the NAV at these levels? And should we expect the buyback to move up or down depending on where the discount is? That's the first question. The second one is to follow up on the opening remarks on JET. I appreciate it's going to be hard to give guidance today, but if you could give us a flavour of the level of investment that you'd like to put into JET, that would be very helpful. Thank you.

Thank you, Andrew. On the buyback, I was concentrating on the JET. You want more information? So it's a function of many things. How well we are doing, how fast we are growing, how profitable we are, how our discount is. You said the discount was around 26.7% of the last few months. I am an optimistic founder, so you can discount my optimistic opinion. But I will also, one year and a half later, remind you that we have the the discipline, the completely reset on culture, and the innovation. So my optimistic vision is that Scum will go down more, because if the tentative is very valuable, and we have 1, 2, 3, 4 billion dollars in profits in our core, that is playing well, innovating, etc., I will call you later to ask, so why the reason to have this level of Scum at 26 or 7 or 8, etc., that it was. So, considering all of that, the back deck is going to be more aggressive or less aggressive. My point on optimization now specifically is, if we can keep buying back, but not only from Tencent, but from Tencent and other assets that we are selling, this is much better for us all. So that's what we are trying to implement now. You made another question? Yeah, it was on the level of investment projects. Yes, the level of investment projects. This is not the problem, to be honest, Andrew. Not the problem today. So how do I see that? First, would I invest more in JET? Yes. My problem today is not to invest more in JET. We became operators of the company six days ago. Today we are having the full week of meetings to plan the next three or four months. The company doesn't even have a plan for the next three or four months, because we are going to start in December. Today, tomorrow, tomorrow the planning for the next three or four months. So we had this discussion last week. Should we be doing like in one day a proposal? The answer is no. You have our guidance results yet. We will give more information on the guidance we've shared as soon as we have it. But I want to reinforce first, the problem is not the level of investment should be. The problem is the efficiency. Two things first. is under-delivering in what they promised. They have their COVID guidance. What they are delivering is less than their COVID guidance. But second, the efficiency of the investment in JET has to improve before any other movement. So I'm not going to increase investment directly in JET if I don't think we are making the... I could put a hundred million dollars in JET. If it's not very well invested, It's not worthwhile. So right now, we are trying to rebalance return on investments on investments and how technology improves return on investments. That's why the guidance for the next two, three, four months, they are not very valuable. Because if we think we can improve it a lot in 45 days, I have to run it first and see the results, then do a new guidance. So that's why... That's why we need 45 days to have a better view on JET numbers. But I just want to reinforce, Nick wants to compliment, but to reinforce our level of confidence that we can run JETs better in terms of growth and profitability is very, very high. And we will share in details more about that when we share more data on JETs.

And I'm reminded just to comment on Fabricio's saying that JET data performs well. It was a listed company until last week. Last time it came to the market, you would have seen that order growth was negative 77%. The company guided at that stage, given their own internal metrics in Euro terms, reported in Euros, and I ever dialed about 360 million Euros for the calendar year FY25, which is December 25. I can say to you that some of those things have continued during Q3, where we've seen further reduction in some of the order growth, and that will cause and have an impact in terms of their regional guidance. We are expecting actions to measure against that, so that they will materially miss the 360-meter.

Anyway, my confidence on GEX growing faster and improving overhead results is very high. But since you have six days, you need to update the numbers on GEX in the next fall.

I think the important thing to point out here is that the acquisition was not made on the results of this year. The acquisition was made on the expectations for turnover multi-years, and which is why you're talking about as planning has just begun on that.

Yeah, so as I said, On these six days, we think the numbers are bad because of this reduction of 6%. I believe that in 45 days, with a strong reset in culture and moving faster in tech, we'll have good news to share. But we can do that today because it's true. Yes.

Thank you, Andrew. And the next question we'll take from Cesar at Bank of America.

Hi, everyone. Thanks for the presentation and the opportunity to ask questions. I just want to focus on M&A, so I have a couple of questions on it. The first one, do I understand correctly that the available firepower for M&A is still around $8 billion? That's the first one. The second one, should we expect you to pause a little bit M&A as you focus on the integrating all these assets and focusing on the ecosystems or should we expect any large transactions in the next couple of months? And then the third one, it seems to me that you've been talking a lot more about India recently. Should we understand that this is back as a focus area for you? So I thought you talked a little bit more about it than at the capital markets there, for example.

Let me take the first one. So it seems I've asked the question. At the end of September, from a total group perspective, we had $20 billion of cash on the balance sheet. About $18 billion of that related to our central corporate cash position. Subsequently to September, we have settled, of course, the jet acquisition as well as La Central. That was about $7 billion that was spent on that. On a performer basis, that leaves us with about $11 billion dollars of cash at the same time. And obviously, you need some liquidity buffer against that. So what is available for M&I is, I would say, at least eight and more, from a peer partnership perspective.

That said, our priority is not to spend eight million dollars or more or nine on bigger positions right now. My big priority by far I think I want to highlight one thing. First of all, financial institutions have been very, very good. We talk more about it on those meetings, but WellEx is doing very good, very profitable, growing well. So we have good expectations, which is one of the central synergies. And second, again, when we announced that there's just this acquisition, many people said, ah, but it's expensive. I really don't believe it. I think we are being paid four to five in something that should be $15 billion. That's what we attribute. So the biggest priority by far is how to make sure Jet comes back, gets back growing, it's the best technology product in the world, and really win in Europe. That's our biggest priority by now. So, as a curiosity, I read in the newspapers all the two or three rumors. Prozis intends to expand $5 to $10 billion on low-techs. I can tell you that But what was it in delivering right now? And again, I think now I have some reputation inside Prozos. It delivered the numbers we promised. And also, I always talk about transparency. We will keep transparency on JET just after a few more weeks or months of work.

Because like you said in your opening remarks, it's focused on execution, execution, execution, right? And then the other question that Cesar had was on Indiana, whether it's a bigger

Prime Minister Modi a few days ago, so it was all in the news that we had talked about in India. But really great, to be honest. I'm always complaining Europe has to move faster than talk about creating big tech companies. And meeting Prime Minister Modi was how we move faster. He asked me, let's do more. So it was a very inspiring conversation. I think what we've done in India is very good. We are the biggest FDI, the national investor in India. Many of our companies has more value to unlock. So we promised you a few IPOs in the last 12 months. Most of them happened. We still have the expectation that there will be another very big IPO, and it's going to be big and good, from amazing companies. So our returns on investment in India are quite positive. We invested in the last one month, I think, in two companies that are growing very fast. Hap is growing 120%. It's the number one company in mobility in the UK. that and they are very good online travel agents and travel and mobility too so i think we are keeping the consistency in the areas we want to invest we are keeping the idea of the consistent synergies and i expect a lot more good news from india not only like spending a lot of money but we put that in the presentations pay you For years, including you, our analysts complained that our P.U. has to perform better. P.U. is profitable. Finally, after many years, the profitability of P.U. is growing quarter by quarter quite well, month by month even better. P.U. is helping other companies to grow faster, and other companies are helping P.U. to grow faster. It's so rapidly getting closer to our ecosystem. We've created other positive impacts. We're excited that we are going to build more, many billion dollars in value

And it's clear you can see the operational improvement in the owned and operated AU, but you're also seeing that increasing connectedness of all the individual pieces within the ecosystem working together a little bit more.

Yes. So you see, this time we shared lots of data in Latin America. We saw that Shark revived in the loyalty center, and many businesses around benefited We are doing the same thing in India, where the results are good, we are going to share more data with that in the next few months. So we don't expect to spend $80 billion in India right now, but to keep having good results in terms of the ecosystem building in India. And I think the latest investments were very good moments.

Yeah, and with pay-it-and-have profitable, we could say that all of our main businesses are being profitable, which is something we've never been able to say. It's certainly a necessary thing. What's it just say? All of the business abroad. All of the business abroad. I've heard it here. I've heard it here. I've heard it in Silicon News.

So, yeah, we are in the city here.

All right, Cesar, thanks very much for the questions. And we'll move to Michael for me. Hello, Michael.

Hi, can you hear me clearly? Yes. Perfect. Well, first of all, thank you for letting us ask the questions and for the presentation. So the first one is actually in iFood. So with Kita and Didi now ramping up their presence in the Brazilian food delivery market, what are your thoughts and what have you seen since October? And then how do you think this is going to impact iFood's growth trajectory over the next year to two years? And then maybe just touching on India. So you mentioned that there's a lot more collaboration between yourselves and the different companies that you have minority stakes in. How do you think about... monetizing that going forward? Is that largely given from yourselves, or are they providing data back at a higher rate?

I understand the end of the question.

It's a connection between the companies in India, particularly the minority trust companies, and whether there's how we facilitate data sharing to improve the upgrades.

Very good. So first on iFood, I think many of you were in Brazil and have visited Brazil one or two months ago. The people that were there, they could see that iQOOD is more than one business that has been doing the same thing for the last five, seven years. The reason iQOOD is growing so fast, it just got to, including all the business, 160 million orders. Just to remind you, last time we met, I think we celebrated 100 million orders, now we're celebrating 160 million orders. It's because it's a company innovating and We think in how we offer business and offer the best technology for the strongest customers. So, oddly, we have competition now, more competition, that is GT and Kieta, and H1 is also entering, Brazil just entered. Those two companies entered in a few cities, I think two or three. They are spending a lot of money per order, like they have discounts of 20, 50, 60, sometimes 70% in an order. So my advice to you, just check later how much they are paying to be there competing. And look, if you give a free meal to someone, people will eat for free. It will happen. But is it sustainable to have the best service, best offer over time? And remember, this isn't the core, that is the food delivery. iFood today have, beside the core, a big loyalty program that gives free delivery, plus discounts on Despergar, plus discounts on, I think, thousands of other companies. We have Fintech, We have dine-in, we have POS machines in the restaurants where we take transactions. We have kiosks where we put orders in the restaurants. We have a credit card, a new voucher credit card, with one million people buying food with a credit card, paying to iFood. We have the business of ads that is going super well. We bought from a company, I sold and we invested in CLM Bonds, great company in terms of loyalty. We have the Classified as Integrated. The integration with Despegar is a big success. So, everything that buys in iFood, they get three points to use on Despegar. We have a company for entertainment at Insimpla. We have the... We launched now, just now, we launched one seed today, this week, iFood plus Uber. So, Uber has tens of millions of customers that are not iFood customers, and iFood has tens of millions of customers that are not Uber customers. I guarantee you that we are going to see a lot of cross-sell in the two best companies in the region. So, some companies are investing a lot to have the offer that we had six years ago, and we welcome competition. This makes everyone run faster, but it's much more than, let's make the next sale of a business and cash call this business. It is, can we be the best? creating new business, innovating, moving faster. iFood is doing that. So if you study around the core food delivery, you see many business. Interesting thing for you, Todd, I know you like the numbers and more than my things on innovation. FinTech, we spent two, three years saying FinTech is the future for iFood. FinTech numbers are growing very fast and profitability in FinTech is growing very fast. So our profitability keeps growing because a few businesses we were invested in one, two years ago. I'll tell you two. Fintech, groceries, and selling through WhatsApp called Anotaí. We were losing money the last two, three years. Now we are making money. So my point to you is that it's a good business and there will be competition. And let's fight for offering the best service for our customers. And I want to remind you Even in their home markets, there is a lot of pressure to compete against other players, so we are confident.

But we will compete. And, Michael, you also asked in terms of given the competitive environment, how do we see in terms of what the impacts of that might be. the high growth rates that iFood is going to, we're very confident that for the second half of this year, we will continue to sort of stay in there at those levels. And we also reiterated our confidence in our overall diet. iFood is also investing, buying a new product, also being somewhat competitive, but we've built a lot of that into our existing processes, and we are sort of re-evaluating various other projects and elements to utilize and free up funding so that we can actually fight against the competitors without changing the sort of trajectory that I've put on for this financial year.

are the periods where we've seen the most growth. And one of the things that Diego often says is, you know, when you focus on price, it's the race to the bottom. But you build a real moat through product. And what you've just described there is an ecosystem that is iFood with an ecosystem that is LATAM. And I think you've highlighted, I think there's tremendous hidden value in that pago business that we should and will do more to bring to you guys in the future. Now, how about we touch on the the India ecosystem, and the question there was how you can really build the LCM and the connectivity between those businesses without connecting data. And you asked about minority.

Yes, exactly. Look, my mind doesn't work like that. I remember the last results call, someone made this same question. If you are a minority, then you can't cooperate between the companies. I disagree. I absolutely disagree. I think we can cooperate with minority companies. We do it. We don't do it because I call them and say, I'm your boss, do you know what I'm saying? We do it because we call a company and say, that's how we run fine-tuning our AI models, that's how we run customer support using AI, that's our KPIs on optimizing our partners' relationship with agents. When we show off that to a good company, The company said, I want it. I'm going to get this data. I want to run my open just like that. With other companies, I'll tell you another story. We showed off that to Mishu. Mishu liked it. But Mishu showed how they are doing. I think it was multi-language customer support. And they said, oh my God, this is very good. We want to use it also. We want to learn more from that. So the point is not being majority or minority. And if you need to be majority to do something good, it's because there's something wrong. Or you are not selling well, or the guy there is not the right guy. We can work with the minorities because we're saying, this company can grow faster. These are the data and the technology that gets there. And we are cooperating well on that. One example, Payo is giving credit and working with customer profiles, with users. We hope that we are are not investors, but the companies are growing faster because of the EU. That's why we argue.

And the other thing to take into account is the LLM, so the LCTM, that we're testing now at TAM and we're getting some of the results already in the deck. That's something that we can also bring to bear in the other ecosystems.

around the world, being trained in the large Amsterdam AI house two weeks ago, where we have now a center of learning and knowledge of AI that everyone is traveling there to participate in the events. We are running today an event with 80 people inside Prozos on fine-tuning large language models to optimize e-commerce transactions. So everything that we did in Latin America is now, like now and really today, going to India and Europe. So you don't need to do that. And we are quite confident to have a lot of growth. A curiosity, I didn't use a lot of the time of the meeting today morning to talk only about tech and innovation, but it was too much information. So we said, let's focus on numbers today. We will get back soon, as soon as Owen wants. If he wants to respond, talk to him. Sorry, I want to do it in two weeks. We are going to share why we are more confident than ever that we are one of the best players

You brought up the AI has to get your questions again, but I think this is an important thing to pause on because this is something that is kind of inherent in the new culture. It's not something you would expect one, two years ago. Can you talk a little bit about the AI has, why you've opened it, what you're hoping to achieve? Because it certainly is a little bit different.

I want to make Amsterdam the center of AI in Europe. Amsterdam has a lot of knowledge, but not the vibrant community. If you go to Silicon Valley, every day you go there, there is hackathons. So we create a big space in Amsterdam, where every day we have a hackathon, a meeting, a course, and it's open for two weeks. We are having every day a big event with hundreds of people, and we are helping the ecosystem, and we are helping ourselves too, but we are contributing to make Netherlands a center in Europe AI. We also hosted last week the AI House ago, which hosted the Illuminate, an event in Europe talking about putting regulators and founders together to reinforce that. And Mario Draghi was one of the speakers there, and President Barroso. We are talking about, Europe needs to move faster, Europe needs to play to win. There are many things in the EU regulation, including the AIF, congratulations Europe, because we did a big change this week, including the GCCOM, that we think should be taking more risk to create leaders. So, the process is taking a much more aggressive or preeminent position to say, let's use the technology and regulators to create a big European tech leader, and we are very confident on our actions. That's great. Please don't kill my email now.

We'd love to have some of our investors now at the AIS so we can match up certain events with your travel plans. So please reach out to IR. So let's move on. Thank you, Michael. We'll move on to Luke at Morgan Stanley. Hi, Luke.

Yeah, hi, good afternoon, everyone. I just wondered if I could pick up on this thread of more competition in food delivery. So you signaled more investment in JET. Obviously, we heard from Delivery Hero and Talabat also pointed to more investment, Dash as well, being a big theme over the last month. But if we just map that through then, for ifood how can we see that progressing into fy27 is that kind of the trajectory that you see there and just particularly in the context that you may need to um do you feel like there needs to be more investment into dark stores or more 1p logistics i'll just be interested to hear your thoughts there And then just finally, I appreciate you might not be able to say anything, but the delivery here is situation. Obviously, you've got until mid-August to sell down to single digits. Is there anything that you can comment on in regards to that? Thank you.

Okay. So, competition on Talabah, we have no access to different view on Talabah. iPhone made a projection for the year that included competitive investors. We are going to deliver on our projection and our growth and everything else, so we are doing quite good. I can't talk today on the numbers for the next year, but as I told you, many of the business that we started one year or two years ago, or three years or four years ago, they are becoming mature now. So iFood is more than the food delivery. One example is the iFood Badoo, if you remember me about this. Remember that Mercado Livre has half of its profit from Mercado Badoo? I think pavo is an important part of my food already. It's growing. So I don't have any numbers today to share on the next year. I can tell you that what's better for this year, we are delivering. We are happy with that. And we have to do the bonus next year in one or two months. On the liver deal, I'm sorry. I don't have any updates on that. We have an agreement. The agreement is for 12 months. We are going to deliver on the agreement that we made. Sometimes I talk in the press. the best thing for Europe. I think Europe would be better as a commencement if we have global tax changes. That said, we have an agreement. We are going to fill the agreement according to the terms of the agreement, nothing to share. However, we are selling assets of companies that has lower... We are selling assets of companies. When I say we are going to sell 2 billion this year, it doesn't include the degree of Europe. So maybe we are going to sell more than 2 billion. Maybe we are going to sell next year. Don't have any of these on that.

Let me just add to that. A lot of the investments that we're making in iFood to drive the business forward, regardless of the competition, are exactly in the same areas that we now need to do even better because of the competition. For instance, optimizing the delivery aspects of the business, you know, cheaper food elements, the loyalty program elements. All of those things we have been doing. We're just accelerating and and improving even more in various spaces. And now we have the AI elements that we can add to enhance that efficiency.

And to complement what Nico points out, some of the things that we did on iFood over the last five years that are quite big, we can replicate that in JET starting this week. Because only now we are the main project. So there is lots of upside inside the ecosystem. That's what I'm selling for one year to you. I think Google and Microsoft and Meta and Tencent are winning, not only because they have one key product, but because they have a scale Instagram ecosystem that enables cross-sell AI technology. We have that, and we will have benefit from that on Jack and on iTunes.

I think one of the things that iTunes has done a fantastic job of in the past is areas that required investments to scale. then don't need all of that investment going forward. You take some of that from area A and deploy it into area B. So it's not incremental investment always in the asset. I think one of the questions that we get underneath this perhaps is, well, what does this mean for kind of your future year guidance? Is this a kind of retrenchment or a return to kind of an investment cycle? But I think you were very clear at the beginning of the call that you expect to go from the other one point something that billion today one two uh even three you said um that's two two two more than that and then that concludes investments in the other parts of the business and food so i guess here the credibility is to think that first time you talk about true because everyone said oh my god i don't see how they can do it we will get to judea and uh so we are constantly are going to keep increasing our our markets I think they probably said the same thing on 160 orders of iFood. So thanks very much for that, Luke. And we will go to Robert at Caliber.

Hello, Robert. Good afternoon. Thank you. Thank you very much. We have first a question on the impact of agentic consumer applications on marketplaces. If you look at these agentic applications, people are using it for more and more tasks. In the case of process, I think you saw the first impact at Stack Overflow, where people found coding suggestions of agentic applications better than browsing on the forum. But increasingly, it could be the case that purchasing decisions could also move towards these consumer agentic applications like JetCBT. So I'm wondering, yeah, how do you plan to integrate your marketplaces inside of these applications? And as user behavior shifts towards, yeah, consumer-agentic applications, yeah, could some marketplaces like Classify lose distribution leverage and the data advantage? So how will you address this to stay ahead? Yeah, maybe a second question on the IRRs. I think in the past you targeted a 20% IRR target with a higher hurdle for startups and lower for high-quality, more mature businesses. If I look at, for example, La Centrale, which we're buying for around 1 billion euros, clearly a high-quality business. It's growing at a kegger of 13% EBDA, and you expect that market growth to continue. So I think it's challenging maybe to get the 20% IRR. So I'm wondering, what is kind of your lower hurdle in terms of larger investments, in terms of IRR? So what is your minimum hurdle to make these deals?

I'll try to respond quickly just because of the time. But on the first one, what you just asked, life agents are going to compete against us. Yes. I told you in the beginning, I want to talk one hour about our strategy there. It's exactly about that. So what we are going to tell you soon is, we are doing live commerce model, we are doing agents focusing on our internal and partners, and we are doing live agents, sorry, live assistance, where we deliver this kind of service to our customers. And I think we will be very well positioned because of our ecosystem and how to operate there, better than any other player outside. So I could talk about that for one hour, but We are moving fast to lead on that, including on many investments we made exactly on this area. So we are bullish and excited about what we can do in what we call live assistance. Next chapter to know more about that. The second is on IRR. We expected, yes, 30% IRR on last exam. Remember, last exam was a small company operating more isolated. We think that putting it together with everything we are doing outside, we are going to get good levels of growth, increasing profitability, and we expect to get more than 30% in last year's hour.

Okay, thank you.

Great, thanks. And it looks like, Will, you're back in the line. You want to have a good commuter line?

I was very stressed with Robert. If you have more time, I can get back to Robert fresh. But let's see if anyone else is there.

Will, are you there?

You left us. Sorry, I was just, I'm muting. Just wanted to come back, so thank you for your comments earlier, very useful. So it's pretty clear the six to seven billion is the right kind of framing for the FY26 buyback. When we think about FY27 beyond, is that the kind of level we should be thinking, or is it just, you know, you're going to have optionality and decide depending on the relative appeal of different uses of capital? Thanks.

Most companies, they do a buyback very specific. I'm going to buy back $5 billion. We are doing an open buyback. So we are not exactly not saying this is the number for the next one to three years. So we don't have any number for next year. But as I told you before, what I don't like is to have an automatic thing. We have to analyze what we have, what opportunities we have, what's happening in the world. I'll give you one thing to think. I think product is ridiculous shit. Again, oh my God, why we can have a company that's creating one and a half billion dollars close to that in profits and still have a discount? The world is not like that today. We have many companies that have 100 times revenues. Having our cash position, but maybe the world is going to change, that's my point. There is a lot of change ahead. I think profit is very well positioned. If the world changes, we are going to become even more uh attractive company because we are doing innovation ai we are generating cash and we have investment capacity so i'm for sure since i have an open-ended buyback i don't need to think how it's going to work next year one year in advance i have to keep playing well with discipline with good capital allocation that's what you asked me one year ago what i'm telling you now one year after we deliver the discipline one year after uh selling less Tencent and more other companies is good capital allocation because we believe much more in the growth of Tencent. But what I commit to you is we are going to keep executing well, but we don't have a guidance for next year yet. Well, we still may not have it, so in six months, maybe we can share it more. Again, I'm confident we are going to keep executing well. What we have in terms of innovation and delivery, to me, I think next year is much more a year of opportunity for us than a year of, oh my God, how are we going to handle not delivering what we promised.

Okay, thank you, Will. We have four minutes left, so let's continue. Thanks, Will. We'll try to get two in. Madim from SVG, if you're on, so please unmute.

Good afternoon. Yes, just two very quick ones from me. So we noticed that the likes of Rightmove and others are investing at quite a high rate in AI, and this has the impact of weighing down on their profitability. I'd just like to understand how pros have done it, because we haven't really seen that impact on profitability with these substantial investments in AI and LCM. And then just on top of that, just how much more differentiated is it when you're looking to acquire businesses like Larsen Graal, you know, the ability to bring this capability

So the first question was how has OLX been able to do so well and expand margins immediately while investing in AI, whereas other companies, I won't repeat their name, have now had to kind of reset expectations because they're investing. And it's been a long journey of OLX investing in AI.

Yeah, so I think it all started one year ago on culture, focusing results, you know, the support of an ecosystem. So many of the things that Alexa is setting up right now, they are also learning and sharing from inside the ecosystem. Large commerce model, for example, the investment was holding an iPhone, and now that it is ready, we are pushing it to Alexa and to India. So I think that's the central story or thesis of process. We can have one classified component on a central operating by itself, or, and that's my thesis, To get a bigger group that knows how to operate, classifies, and AI, we can make their performance better. So the first big company we are operating at is Despegar. The number of Despegar doesn't look that big because April, May, and June were bad. I looked at Despegar month by month. It is increasing every month for six months. So that's the difference. OLX benefits from that, and I'm quite sure La Central is going to benefit from that too.

So the overall benefit of being part of the group. Nadeem, thanks very much. We have to move to the last question. I think we're going to land this. Maddy, take us home, please.

Yes. Thanks a lot for taking my question. Just two quick ones from my side. Given your recent positive trip to India and the meeting with the Prime Minister Modi, would you say your CMD ambitions for India were too conservative? In hindsight, I mean, with just about 1.3x revenues from FY25 to FY28 and just above 5% margins. That's what your CMD guidance was. So, wondering whether that changes at all post the meeting with the Prime Minister. And then the second one, on the asset monetization opportunities outside of Tencent and Mithuan, is there any major opportunities you can talk about? Thank you.

It was really inspiring, but then you sent me numbers 1.3, 1.4, 1.5. I didn't connect those numbers super well, so I'm sorry. Yeah, I'm sorry.

I think the numbers you're referring to are like the same. because the ecosystem around that is much bigger. So it really depends how the control positions evolve over the next few years. So it could be substantially different depending on how the power goes up. Yeah, it makes total sense.

That's why I didn't recognize it. Our expectations are bigger than theirs. But that's the way it is. These will be important on there. after talking with Prime Minister, if something changes. I'll tell you, yes, I'll tell you one thing. We did all the, we moved faster in innovation in Brazil and Europe. That's the true thing that we're really running on AI. I think we are in this deep thinking. India has to lead. India cannot be one day behind Brazil and Europe, so in Egypt. Anyway, another question? I forgot the other question.

We've got two billion that we are in for this financial year. There are other assets that we can consider, but we're not going to sort of pre-announce if we are not getting outside.

There is some recommendation to say we are selling this home, but we probably can understand why. But our portfolio is much more than made to earn, and that's So there are many others. Some of the others we talked about this year, today. There are many others. There are five or ten. And there are many more billions we could sell, but we're not going to say exactly what. I can guarantee you, this year we sell 2 billion. Probably next six months we are going to announce how many billions we are going to sell the next year. At least a few more billions. All right.

Well, thank you for that, Matty. And thank you very much, everybody, for joining us. Are there a couple of words you want to leave us with? Do you want to say a few final words?

I hope you see something in front. So a few final words. Today we focus on numbers, and I'm happy. I think we are moving on the right direction on numbers. We will get to a few billion dollars in profits. There is much more to talk on execution of jets, not for today, and much more to talk on innovation, specifically about jets. Someone asked me today, I will talk exactly about that. So I am a I was unsure that we should be doing more and moving faster, but I think we are moving well. Just getting started, but our thesis from here is we are going to be a strong, tech-focused, operating company. We are getting there. So I'm excited with the results. Hope you enjoyed them too. And I hope you're going to keep sharing good news with you in the future. Thanks for coming, and thanks for being partners. Let's keep building the future together. Thank you.

Thank you very much, everyone. Thank you, guys. And there are a couple of questions here that Ira will follow up. And always, if you have follow-ups, please reach out directly to your friendly IR team. And we will see you very soon. Thank you very much. Bye-bye.

Bye-bye.