Nexi Spa Azioni Ordinarie

Good morning. This is the Coral School Conference operator. Welcome and thank you for joining the NEXE nine-month 2025 financial results presentation. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. Should anyone need assistance during the conference call, they may signal an operator by pressing star and zero on their telephone. At this time, I would like to turn the conference over to Mr. Paolo Bertoluzzo, CEO of NEXE. Please go ahead, sir.

Good morning, good morning to everyone, and welcome to our nine-month results call for 2020-2025. As usual, I'm here with Bernardo Mingrone, our Deputy GM and Chief Financial Officer, with Stefania Mantegazza, Leading AR, and a few more members of our team that may help to answer your questions as needed. As usual, we start with the summary of the key messages. I will hand over to Bernardo to cover the results in more detail, and I will come back for the closing remarks, and most importantly, to answer to your questions. Let me jump to page three with the summary of the key messages. First of all, we continue to deliver profitable growth for the nine months and in the quarter. Revenues are up 2.8% for the nine months and 1.8% in the quarter. As anticipated in the third quarter, We see more material effect of this trading event that we have anticipated when we provided the guidance in March this year. More precisely, we're talking about the bank losses from the past and some key bank contract price and negotiation effects. These effects will peak probably in Q4 this year, and then we'll start slowing down across 2026 with a more material reduction in the second half. The underlying growth, therefore, net of this effect is at about 6% year-on-year, both in the nine months and in the quarter. Merchant solution revenues are up 2.7% in the nine months and 0.6%. versus the same quarter last year, with underlying growth being at around 5%, 5% to 6% in both the nine-month and the third quarter. EBITDA is growing at about 3.5%. in the nine months with a 35 basis point margin expansion. The quarter results in terms of margin are a bit affected by the revenue mix that sees a stronger IES and some operating cost phasing. Second key message, we continue to shape NEXI for future profitable growth. Three key points that we want to underline. We continue to progress our strategy execution in the integrated payment space. the space of convergence across payments and software. As discussed in the past, our strategy is based on partnerships with ISVs, and since the beginning of the year we've added another about 50 partners, ISV partners, to our pool that is about 500 across all our geographies. Second key message that we want to reiterate, we continue to build a stronger multi-channel approach to the Italian market, obviously still leveraging our very strong partnerships with the Italian banks, but also adding to this strong channel also complementary channels, targeting more precisely SMEs, that is our core focus. And these complementary channels by now represent year-to-date about 26% of our total new sales. Last but not least, we want to underline that merchant solutions in Germany is growing double-digit in the nine months, even accelerating in the third quarter, supported by customer base and market share growth. And we really want to stress this performance in Germany because obviously there's a lot of debate around how strong players like Nexi are in competing with the newer players focused on SMEs, the single platform runs and all of that. And clearly the performance in Germany shows very well that we can compete, we can win effectively and have accelerated growth as well. The third key message we want to deliver is that we continue to create value for our shareholders. Across 24 and 25, we did deliver 1.1 billion euros of capital to our shareholders, while becoming at the same time an investment grade issuer since the end of last year. Net financial debt is now down to 2.6 times that. EBITDA, notwithstanding the fact that we have returned in the year already €600 million to shareholders as remuneration, which is a 20% increase versus the previous year. Obviously, in March 26, we will talk about the capital allocation for 2026 on the back of the more than €800 million cash that we will generate in 2025. Coming to guidance, we confirm we lend revenues the low to mid single digit year-on-year growth space. We confirm that we generate excess cash for more than 800 million euros with high degree of confidence. As far as the margin is concerned, for sure it will be positive with Q3, with Q4, by the way, seeing a margin expansion better than Q3. Where it will land precisely will depend on the volumes we will see in Q4 and the business mix that we will see in Q4. In any case, we are talking about only a few million euros here and there. Let me now hand over to Bernardo to go through the results more in detail.

Thanks Paolo, good morning. Starting on slide number five with revenues, as Paolo has already mentioned, this quarter was significantly impacted by discontinuities as expected. This has been accelerating throughout the course of the year. You can see the revenue growth in the quarter of 1.8% is distant from our underlying growth of 6%, and this gap is widening compared to the nine months. So as we said, this is the highest impact we've had year to date. and the peak is expected to be reached in the coming quarter. With regards to EBITDA and EBITDA margin, EBITDA is growing. The margin, and please remember we're always talking about an EBITDA margin north of 57%, suffered in the quarter from what I would characterize as a slightly different revenue mix than what we might have planned with a bigger contribution coming from issuing the merchant solutions. and also a bit of phasing effect on some costs, which might have spilled over from one quarter to the other, which is impacting the margin accretion. However, for the year, we are positive at 35 basis points. Moving on to merchant solutions on the next slide, we have growth in the quarter. Again, here, this is the business unit on which the negative impact coming from the discontinuities we've talked about impacts us the most. You can see the underlying growth is mid-single digit. Overall, I think we can point to continued growth in international scheme volumes, albeit with a softer summer. We have a slightly unfavorable volume mix, as I was mentioning earlier, as a group, but also within merchant solutions with some pricing and mix effects in e-commerce in Poland. We're talking about Sorry, just a few million euros here, but that makes a difference, obviously, in terms of year-on-year growth. I think more importantly, from a volumes perspective, Poland, but more importantly also Germany, which is growing in the quarter, in the mid-teens, have shown a robust performance. We continue to grow our franchise in the most valuable segment of SMEs. We continue to upsell and cross-sell our value-added products and services And indeed, we're making progress on the ISV partnerships front with more than 50 signed in the nine months or in the year to date. Issuing solutions at a very strong quarter, 6.5%, 6.6% growth. This, as usual, has been sustained by volume growth. The international debit product in Italy upselling and cross-selling throughout the group. I think it's fair to say that part of this higher performance in the quarter than for the nine months will be reversed in the fourth quarter. We expect it to benefit less from year-on-year project work, which, as you know, as we've discussed in the past, it's very hard to predict in which quarter they will be booked. And we're also expecting in the fourth quarter to see – The first effects of some insourcing from a large Nordic client that we've spoken of many times in the past is something, a decision which goes back three or four years and has been postponed a number of times and is now kicking in. So the fourth quarter is softer than the third, but a strong year to date and expected for the full year in any event on issuing. DBS is the business unit which has the most reliance on, let's say, project work and one-off billing, so it's lumpier. I don't read too much in the quarterly performance. Overall, for the year, we expect growth and a good performance from the business unit. Indeed, we recently launched in October a very important piece as part of our payments business, the verification of payee, which affects hundreds of banks across Europe. We're the largest player in the space, and this was a big success for us. From a geographic perspective, it doesn't surprise that Italy is the region which was impacted the most by the discontinuities of the Italian banks that we've spoken of so many times. Nordics, I would say, good performance in the low single-digit area, but benefiting from continued progress on selling value-added products and services to our client base. DAC, I would say very strong performance in Germany, slightly less so in Switzerland, but overall good performance from the region. And CSCE, which is probably the most impacted by the softer summer and what I said earlier about Poland. Finally, before handing the floor back to Paolo on costs, costs grew about 3% in the quarter. HR costs still showing the benefits of the initiatives which were put in place last year and continue to be implemented during the course of this year. Slight growth coming on the non-HR costs, which is the one most impacted by volume growth, by inflation, by the growth of our business in general. But as you know, we manage our cost base as a whole, and you can see the 2% growth for the nine months is pretty much in line with our expectations, and I don't expect a the final part of the year to be any different. Actually, the fourth quarter expected to be better than the third and probably better than the nine months to date. So I think other than the phasing effect, which I mentioned earlier, which has to do with intra-group VAT and the timing of these things, and again, we're talking about a few millions of euros here and there, I would expect strong cost performance for 2025. So let me hand the floor back to Paolo for his final remarks.

Thank you, Bernardo. Let me just reiterate page 11, the messages that I've already anticipated on guidance. We will land our top-line growth in the low-to-mid single-digit space with underlying growth acceleration. Cash, excess cash, will generate at least 800 million euros committed to with a high degree of confidence. And as far as If the margin is concerned, for sure it will be positive. We expect a Q4 performance in terms of margin expansion to be better than Q3. Where exactly it will land will depend on the dynamics in Q4. But in any case, we're talking about a few million euros shifting here and there. Let me close from where I started. Three key messages on page 13. We continue to deliver profitable growth across the business. So we continue to shape next for future property growth. And again, the three topics that we really want to underline is the progress in integrated payment space across geographies, the continued acceleration of the newer channels in Italy together with continued good performance of the bank partnerships as well. And last but not least, a very strong performance and improving day by day in Germany for merchant services. And last but not least, continue to stay very focused on value creation. We're returning this year 600 million euro to our shareholders in March. We'll talk about what we will do for 2026 on the back of a strong increase of excess cash generated in 2025. Last but not least, let me anticipate and invite you actually to the capital market day that we will have at the beginning of March. More precisely, the current plan date is the 5th of March. Let me stop here and let's open to your questions.

Thank you. This is the Coruscant Conference Operator. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 under touchtone telephone. To remove yourself from the question queue, please press star and 2. Please pick up the receiver when asking questions. Anyone who has a question may press star and 1 at this time. The first question is from Gregor Herman, Barclays. Please go ahead.

Good morning, everyone. Thank you for taking my questions. Just three of them, please. Just on the guidance, can you confirm whether you need reacceleration in Q4 to meet the EBITDA guidance or simply the cost reversal that you mentioned that you expect in Q4 is enough for you to meet that cadence? And then I think on the revenue, the guidance still leaves a pretty wide range for Q4. Can you comment whether you expect a reacceleration in Q4 there? And finally, on issuing solutions, you mentioned some phasing effects. Would you be able to quantify these phasing effects, please? Thank you.

Hi Gregoire, this is Paolo. Thank you for your question. We just commented on guidance and then I pass to Bernardo on the issuing effect. As both Bernardo and I said in Q4, we expect to see the peak of these extraordinary effects and therefore it's going to be difficult, unless we are surprised ourselves, to see an acceleration of revenues in Q4. Nevertheless, we expect to see positive revenues in Q4. and in particular we expect to see some instead acceleration from merchant services. Again, it will depend very much on November and December that, as you know, are very much peak months in our industry, while, as anticipated by Bernardo, we've seen some reversing on some phasing in issue that instead in Q4 will perform not as good as in Q3 and year-to-date. Let me pass over to Bernardo for quantification.

As Paolo was saying, I think let me just add to his comment. In terms of the evolution of revenues during the course of the year, I would highlight what we put in the slide in terms of the underlying revenue growth, which has been pretty homogeneous throughout the quarters. Quarter one was probably a little lower than quarter two, and quarter three was similar to quarter one in terms of the underlying growth. And that's pretty homogeneous. Where you get the big gap between reported and underlying is this effect of banks which are exiting. And I think we spoke of this other times. I mean, we do our best to slow this down as much as possible, to hold on to clients which are being migrated from our platform to others as much as possible. But the impact of this is that we have a longer period of time in which there's a gap between banks. underlying and reported. And the shape of this curve, this gap, is very hard to predict. I mean, it really depends on our efforts and also on the banks trying to migrate these customers' efforts. So it's very hard to call to the basis point how it's going to impact. However, with regards to issuing, going back to the issuing question, we're talking about single-digit million euros of impact coming from banks. project work, which was probably in the fourth quarter compared to the gap between year and year, fourth quarter and fourth quarter at this point, compared to third quarter and third quarter, because that's what we're talking about. And we have a similar impact, something which is less than €10 million for the year, coming in a year, coming from the migration away from this Nordic customer. So how quickly they migrate away from us, I mean, it's really up to them and how that impacts us in the fourth quarter, we will see. But those are the two impacts.

Okay, that's clear. Thank you.

The next question is from Josh Levin, Autonomous Research.

Good morning. Two questions from me. First, any views on what PSD3 and PSR might mean for NEXE and the broader European payments landscape? And then second of all, I guess it's refreshing to have a call where the scripted marks don't talk about AI, but to the extent you can, are you able so far to internally quantify the impact of AI on any of your unit economics?

Thank you. To cover both.

Listen, PSD3, PSR, I think, I mean, we don't see any material effects directly on the business and so on and so forth. If anything, we see some positive effects because these new regulations are creating further complexities into our business. And ultimately, our company is in the business of simplifying payments for our customers. being merchants, corporates, banks, and so on and so forth. And the reality is that the more complexity there is around, the better positioned are large players like us versus the smaller ones that normally struggle to follow through on these complexities. So in general, we believe this is going to be something positive for us. On AI, we're all in in AI since, I would say, a year and a half ago. This year, we already see the contribution across, I would say, mainly technology expenses, both CAPEX and OPEX. for double-digit million euros. Let me not be precise in this specific case. For next year, we're planning much more than that, and this is across technology development, software development, software testing, infrastructure management, operations, onboarding, marketing, back-office processes, general productivity. We are all over the place on this, and we believe that this will be a great contributor to increasing efficiency. across the company and also obviously enabling us to invest more into growth over time as well as supporting continued margin expansion and cash generation. Obviously, we're also very much into leveraging AI for product innovation and differentiation. And most importantly, we're deeply into the topic of agentic commerce, which as we all know, will become relevant over time for the e-commerce part of the business. And on this front, we are participating both on the big tech initiatives. We are one of the few European companies cooperating with Google in the setting of the new standards on the agentic side of commerce. But at the same time, we're deeply involved with international schemes, MasterCard and Visa in setting the future rules that are fundamental in defining how agentic commerce will work. And clearly, clearly, clearly, this will be very much also European-specific, or in any case, continent-specific, because they will have to be consistent with European regulation. And again, given the position we have, we believe we are in a good place to be able to shape this and be a protagonist in this space as well.

Thank you.

The next question is from Han Leitner at Jefferies.

Thanks. Can you give us an update on the Sabadell joint venture? given the Spanish banks have been not merging. And then can you talk about the 2026 expectation and current consensus is just looking for a slight acceleration, but your headwinds with the Italian banking contract should come out of the base. So maybe you can talk there a little bit about the expectation from project work, the issuing contract ramping down, and then underlying market trend growth you see. That would be it.

Good morning, Hannes. Let me take both questions. Sabadell, finally, after I think two years, now we have seen what has been the conclusion. Sabadell remains an independent bank. We are obviously happy to see it. And again here, let me lay down the facts as clearly as I can, even if we discussed them in the past with many of you. First of all, We have no commitment whatsoever any longer across the two of us because this was an old deal that was happening in old market conditions and therefore there is no obligation any longer among the two parties. We are in great relationships. a great relationship, and we have agreed these are very, very friendly. At the same time, we continue to consider Spain an interesting market for a company like Nexi. And honestly, we continue to consider Sabadell a fantastic potential partner in Spain, given how focused they are on payments, given how focused they are on SME, given how deeply entrenched into the local ecosystem they are. And therefore, we will continue to have conversations with them to see if there are new opportunities to do something together on completely new terms, potentially also completely different business model. So great relationship, still interested in doing something at different terms. We will see where it lands in the coming months. We are very, very relaxed about it and actually happy to have the opportunity to have the conversation. As far as 2026 is concerned, obviously, as you can imagine, we are working on our budget for next year. We'll talk about it in March together with the guidance. I can only reiterate what both Bernardo and I said. As far as this is concerned, we should always remember that our performance this year is materially affected by these exceptional events. And therefore, the dynamic will really depend on how these events come into place and then unwind over time. As we said, we see these events peaking in Q4 this year. then continuing at a slightly lower level in the first half of next year, and then slowing down towards the last part of the year. Therefore, we would expect the overall effect on a yearly basis to be probably a bit lesser than what we've seen this year, and this should support with our underlying growth continuing, should support some acceleration, but this is a topic for March.

Maybe just a quick follow-up on German performance. Was this kind of also driven by one of your competitors basically being in the spotlight with credit downgrades or is that all organic initiatives?

No, no, no. It's all organic initiatives. This is growth coming from effective products in the market, competitive products in the market, a strong focus on the most valuable segments being SMEs, and in particular the mid-part of SMEs and the more national corporates, the mid-corporates, now supported by a strong and focused investment in go-to-market and in sales and, honestly, a strong market. team in place in the market. It's all organic, and by the way, we are winning not just against, I think, the incumbent you have in mind, but a little bit more across the board. Maybe coming back on your questions around guidance into next year, as I think we have anticipated in March as well, this year a lot of the effect that we've seen from these exceptionals has to do with merchant services in Italy in particular. Now, next year, we should see less impact into merchant services and more into issuing, given this phasing. So let's see how it evolves. Thank you.

The next question is from Sebastian Stavowitz, Kepler Shoe Group. Please go ahead.

Hello everyone and thanks for taking my question. On pricing environment, you mentioned a little bit more pricing pressure in Poland, if I'm right. Have you seen any kind of changes in the competitive landscape, new players being a bit more aggressive in some of your markets, whether it is traditional PSPs or some digital players or commerce platforms? Coming to the market, that would be the first question. The second one, in terms of contracts renewal, do you have any major contracts renewal coming into the next 12 to 18 months to understand if there is more downside risk to your revenue on top of what you expect already from the contract ramping down at Banco BPM and other discontinuities? Thank you.

Good morning, Sebastian, and thank you for the two questions on pricing pressure for new players and so on and so forth. I think what we are seeing in Polish e-commerce, that again, we're really talking about a few million euros here, which is just, I made it explicit to you and transparent to you because in the quarter and in the region, in merchant services, they have a few basis points in fact, but in the theme of things that are totally marginal. Honestly, we don't see any major change in dynamics. Obviously, there is more pressure in various countries from these newer players, more focused on SMEs. We are competitive in the market. We have to stay competitive. We do what we need to stay competitive. I think the performance in Germany is showcasing it very well. Poland, we continue to take share. Also, in this environment, obviously, in places like Italy and Denmark, where we are by far the leaders in the market, we are more attacked by these players. We are, by definition, the more visible ones. But that's the reason why we're ramping up our direct sales channels next to the, and in partnership with, the bank wants to help us remain and stay competitive versus these players that normally have a direct go-to-market as well. So we believe we are overall well set up to compete in that space, and we will continue, obviously, to invest to stay competitive. But as far as the second question is concerned, on contract venues, I think we did comment a little bit on this topic last time. We have a... won renewals on 100% of the deals that were up for renewal over the last 15 months by now, or something like that. I think we said 12 three months ago, so I guess now it's 15. Going forward, we see much, much less of potential renegotiations or situations I think probably the one that is worth mentioning is going to be the renewal of the Montepaschi distribution agreement on the book in 2027. We have a great relationship with the bank, and don't forget that the book is ours. So we're really talking about the distribution agreement because we did buy the merchant book back in 2017. So, but obviously we will do whatever we can to continue the great relationship we have with them, and we just renewed other contracts with them only a few weeks ago.

Thank you. The next question is from Aditya Butharapu, Bank of America. Please go ahead.

Good morning. Thanks for taking my questions. Could you just clarify the comments on Q4? You said you reached the beginning of the Q&A that you expect an acceleration in merchant services. Maybe I didn't fully capture that. So if you just clarify that. And then also just related to that, can you talk about what you've seen so far in Q4 in terms of volumes? I know October is probably a smaller month, but any color on what you're seeing on the volumes or the broader macro would be interesting. Second question, you talked a lot about the ISV partnerships and you have about 500 in place right now. How big are those partnerships in terms of your overall volumes today and how fast are they growing? Any color would be appreciated. And then finally, just on the underlying acceleration you talk about in 2026, can you just talk about, again, the drivers there, what should help to improve that?

Good morning, Adi. Let me take the three of them. Q4, MS, re-exceleration, probably yes. We're talking about small numbers again here. Let's be clear. We're always talking about a few million euros shifting here and there. And that should be supported by the various initiatives that we're doing, but also from the fact that, at least in Italy, in terms of volume, we should start seeing some reversal of volume. the strong impact that we had so far on MS, in particular from the Banco and now recently from the Casa Centrale. So that should happen. As we also said, instead we will start seeing more impact on IS over the next few quarters. Then let's see what happens. If I look at volume dynamics in October in Italy, we already see a little bit of better uh, better, um, uh, volume, uh, growth. So it looks like it's moving in the right direction, but again, very early to say again, never forget that the fourth quarter is really, really shaped by what happens at Christmas and, uh, and Black Friday and all that. So let's see what happens. On ISVs, it's difficult to give a number because the classification of what an ISV is versus an ISO versus an ECR provider is very, very complicated. So we really don't want to be stuck into numbers that then change over time and then confuse you. Let me just give you a little bit of the flavor here. We are talking a lot about this topic because we believe that long-term it will be impacting our industry also in our geographies. However, this is a topic that, in terms of overall impact, is extremely small and fragmented across Europe at this stage, at least the Europe that we see. Nothing to do with the U.S. It's coming. It's coming slowly. It's coming in a very differentiated way across the various markets. This topic of ISVs and the materiality of it is more visible in the Nordics, where this A bit earlier, as you know, the Nordics are super digitalized as economies and therefore also SMEs are digitalizing faster. And that's the reason why we see it there faster as a dynamic. Germany is very much behind the Nordic situation, even if we start to see obviously more focus there. In Germany, what is still big is ISOs, resellers, this type of dynamics, which are not precisely Poland, I would say, is more or less in the state of Germany. And last but not least, Southern Europe, Italy, but also Greece, Croatia, and the other markets where we're present. This is really, really, really small. Obviously, we're working to take position, but you hardly see these volumes. A lot of players are trying to get organized to do this, but they're still in the process. And obviously, we are in the process of working with many of them. As far as 2026 is concerned, I can only reiterate what I said before in terms of the market risk dynamics. Again, as we said in the past, we see our underlying growth remaining solid in the mid- to single-digit plus, and ideally accelerating on the back of the market share gains here and there, plus the initiatives to increase value for our merchants here. with software, merchant financing, and the various other topics we discussed in the past. The profile precise will therefore depend very much on what happens on these exceptional events that we discussed in the past. Again, as I said before, this should ease out, especially towards the end of 2026. If it happens the way we see it happening as we speak, the overall impact should be a bit lower than this year, and therefore this should support some reacceleration. But again, on the back of strong underlying.

Thank you.

The next question is from Alexandre Four, BNP Paribas. Please go ahead.

Good morning. Thank you very much for letting me on. I have two free questions, if I may. One is going back on... This commentary you made on both discontinuities having reached or reaching peak pressure in Q4, just a little surprised because to your point, it feels like issuing will come under pressure next year. You mentioned that renegotiation in the Nordics, but I think Banco BPM was also supposed to migrate off next year? So is this being pushed a little bit? Just trying to get a sense of the latest timing there. And maybe relating to that, how should we think of any potential lingering margin headwind if we have some of those lucrative relationships continuing to dwindle in 2026? And my last question is, topic that you touched on earlier, agentic commerce. Just curious, Paolo, how you think about it more broadly, looking maybe three, four years out. Would you view this as an opportunity to to take further share away maybe from banks who might struggle to keep up. And beyond share dynamics, how would you view agentic commerce impacting yields and margins? I think there's more work you need to do. Maybe you'll be able to price for that. So any thoughts there? Much appreciated. Thank you.

Hi, Alexandra, and thank you for your three questions. questions or maybe two plus one. First of all, on the discontinuities in Q4, Again, we don't have full control of the phasing of all these things. You're right in saying that most of the effects from Banco issuing are expected at some point into next year. To be honest with you, we don't have full visibility because we understand the supplier they've chosen is behind plan. We may start to see something on a part of it in the last quarter, but again, it's not just Banco. There are smaller things as well. So that is why if you combine everything, we expect to see the last quarter this year as the one with the highest impact. As far as, and again, as I said, into next year, then from this peak, we expect to have basically not the first and the second quarter starting to slow down, probably more similar to the third quarter this year, and then instead having a material reduction towards the end there. But again, the exact phasing is not depending on us. And by the way, we fight as much as we can to make this happen as late as possible and as small as possible. As far as margin entering into next year, clearly, this dynamic pull pressure margin, the simple fact that we've expanded the margin this year tells you that as we do all of that, we also have a number of initiatives that increase margin, that the new things we are doing are margin contributing. And by the way, we continue to do a pretty hard work on efficiency as usual, but obviously even more in the case of the environment we're in and that's one of the reasons why I think as I was answering to the question of Josh in the very beginning we are so focused on AI as a lever also to create a space for margin expansion and also our investment as we look into next year now this is exactly what we're looking at I think ultimately where we'll be landing on margin next year will depend very much also on where and how much we decide to invest ourselves into the various topics that we've been talking about in this call as well. Agenda e-commerce, listen, I think it's a super fascinating topic. Let's be very clear. I think if people tell you they know exactly what will happen, how it will happen, and so on and so forth, they may be stretching it a little bit. It's super complex. And by the way, to a certain extent, we like complexity because, as we said in the past and also today, it's always an advantage for people that are really focused and that scale with competence and in this environment. But let me try to add a few comments here. First of all, never forget that e-commerce for Maxi is maybe unfortunately a relatively small In the sense that we're talking about 5% to 10% of our total revenues growing nicely. And this is clearly one of our growth engines, but is a relatively smaller part of our portfolio, point number one. On that basis, we see, as you mentioned, rightly so, this complexity potentially being an asset for us. because, again, the smaller players, the banks in general, will struggle to be a part of this, quote-unquote, potential revolution in e-commerce. Clearly, our partner banks in Italy will benefit from our efforts, and we'll be partnering with them also on this front. I want to be very, very clear. But never forget that, ultimately, we're partnering with banks in Italy, Greece, and Croatia elsewhere, banks are competitors, and therefore we believe that we really struggle to keep up in these spaces, or at least many of them. To be honest with you then, how this will develop will depend very much on customers. And when I'm talking customers, I'm talking about consumers, the ones that buy stuff. Because if you really want the extreme version of a gentic commerce, which is the one where not only you start the commerce activity from scratch, from AI, from agents, but you complete the transaction including the payments in an agent-to-agent dynamic, that really requires a big leap of faith from the customer that basically has to trust an agent fully for spending his or her money. And I think that this is maybe one day possible, maybe for certain verticals and product categories, But honestly, how big it will be in the future I think is really something that we will need to see. In any case, we are investing in this space and we'll be organizing ourselves in this space for obviously enabling merchants in any case to be able to interact with agents because maybe it is going to be just a small thing, but our role is to help merchants to accept any type of transaction, any type of payments, also the ones coming through agents. At the same time, we're already working on what we can do on the issuing side to make sure that our products, our cards, are agentic commerce ready. Therefore, we see a lot of work that we can do to enable all of this. But I'm sure we'll talk about it again many times in the future.

Thank you very much.

The next question is from Justin Forsyth, UBS. Please go ahead.

Thank you very much. Good morning, Paolo and Bernardo. Just a few here from me. I want to hit first fiscalization in Italy. If I'm not mistaken, I believe that's meant to take place and become enacted, I believe, January of next year. Do you see that as a potential forcing factor for greater adoption of software-led payments in Italy and or potential for Nexi and Nexi's ISV partners to grow? Second question is around the ZipPay partnership in Ireland, which I believe you helped roll out this application within your DBS solutions business. Maybe you talk a little bit about how you won that, what the monetization and rollout timing looks like there. And just more broadly speaking, how you see the go forward opportunities within DBS and whether you see this as a business line that's strategic to you longer term and add synergies across your other business lines and maybe updated thoughts on what you plan to do with that asset, if anything. I know there's been some news on that subject. And finally, just a real quick cleanup question for you, Bernardo. If I have the math right, it seems like you had 0% growth international schemes in the quarter. I know you noted some softness in Southern Europe. Also, I'm sure that has to do with the bank M&A as well and MS. But maybe if you can provide a normalized number there and or also, I know we were commenting on trends in October month to date. Maybe you could add Germany and the Nordics to that as well, if you don't mind. Thank you very much.

Hi, Justin. I'll let Bernardo take the last question. On fiscalization, yes, it's right, it's happening. It will happen in a few months, but it will happen in such a way that will not require merchants to change neither the cash register nor their... acceptance solutions because the reconciliation will be done by the tax authority technology in the cloud. Therefore, the only thing that merchants will have to do is going to be to connect in the cloud to associate in the cloud their cash register, which is already connected. Don't forget here, maybe let me step back so that everybody can follow this conversation. In Italy, as well as in other places, there is already the obligation to have your cash register connected with the tax authorities, okay? The new news that will be implemented into next year is that there will be a connection in between what the terminal is transacting on digital payments, the point of sale terminal, and what the cash register is registering and is transacting. And this connection in between, clearly this is intended to avoid certain behaviors for tax avoidance that were playing with the two devices being not connected. Now, this connection will happen in the cloud, and therefore there is no need for changing the ECR, there is no change for changing your cash register, there is no need to change your acceptance solutions, your point of sale terminal. The connection will happen in the cloud. The merchants will simply need to register in the cloud the two, if you like, components and associate the two of them. Obviously, we will be helping. We're already helping the merchants that will be able to do it with Nexi in one click through our digital assets in the cloud. Around the market, as you can imagine, No, you have some ECR vendors that are claiming that you need to change everything and so on and so forth. But honestly, that's a marginal, I would say, commercially aggressive behavior, but that's absolutely not needed. So we believe that this dynamic of digitization of merchants will continue with its own pace that in Italy so far is relatively slow. And honestly, we will try to accelerate ourselves through our partnerships with our own initiatives, but should not see a material change because of fiscalization. On these account-to-account, instant payment-based service that we have developed with the Irish banks, I think it's a nice service. We are very proud of being chosen by them and by a number of other countries also outside of Europe. I would love to tell you it's big and growing. The reality is that it's relatively small. You don't see it into the big scheme of things, but it's something that, again, we are very proud of and will continue to pursue because, ultimately, whenever we are chosen by central banks, when we're chosen by bank consortia, consortia is always a great testimony of the value that we can create and how deep we are into technology and modern solutions. As far as DBS is concerned, more broadly, we are where we were every single time we talked about it. There are areas of this business that are less strategic, and we continuously review the portfolio and pursue certain potential projects. but again, this has already happened, will continue to happen on a one-to-one basis. Last one, Bernardo, on your side.

So the volumes, I presume you referred to the 1% growth of value-managed transactions in the nine months that we reported this on slide six. I couldn't find the 0% you're referring to, but I think if the question was...

Bernardo, just to clarify, I was just saying that international schemes, the nine months was, what was it, about 5%, and I think that implies something close to zero for the 3Q.

Yeah, okay, fine. I mean, in general, I mean, there's a recast, as you can see, in the database due to the fact that we're aligning, let's say, as we replatform across the group, in particular in Italy, we have recast some of the historic volumes just to make sure they're 100% aligned with with the revenue. The revenues were always 100% correct. The volumes, maybe we had more than one, we were calculating maybe more than one time some kind of volumes because they were driving certain revenues. And that probably gives you the impact you're referring to. But in general, I think the crux of the question was about the impact of the banks that are leaving the portfolio, so the underlying, let's say, volume. And I would say that in Italy, you know, that weighs probably Five percentage points, more or less, and it's about half that at a group level. So if you look at it at the Italian level, it's twice what it is at the group level.

Got it, got it. And the last piece of that was just on the Nordics in Germany in October, if there's any additional comments there. Thanks.

October, Germany, as we mentioned, for the first nine months, for the third quarter, is performing very well, you know, mid-teens in terms of growth. I think the acquiring volumes are strong. Cost terminals may be lumpier. But in general, I think even October is a strong month, continuing like the rest of the year. And Poland, if you look at physical acquiring and e-commerce, both volumes are strong. As I said, when we called out Poland... We're talking about more of a pricing stroke, let's say shift to marketplaces, larger customers on e-commerce compared to smaller customers, which has a pricing effect. But on volume growth, Poland is performing pretty well.

I think in general the way you should see it, Justin, is Nordics trialing around mid-single-digit volume growth, maybe a bit short of that, but around mid-single-digit, which is pretty good for a market that is already penetrated where we have a strong leadership position. And instead, Germany and also Poland, by the way, in the high single-digit type of space.

Awesome. Thank you so much for the time. Appreciate it. Thank you.

And the last question is from Gabriele Venturi, Banca Acros.

Good morning. Thanks for taking my questions. Could you please comment on potential risk and impacts that could arise from possible M&A developments that could involve

Good morning, Gabriele.

Well, listen, you know better than I do that the situation is super, super open, and there are many options that we can read in the media. spectators to all of this. The only thing I can comment is that we have a very strong partnership with Create Agree Call that has just been renewed for the next three to four years across issuing and acquiring to 2029 and the performance with them is super strong and the relationship is great. Same goes along for Montepaschi, where, as I said, we just renewed a part of the issuing contracts. The other part is longer term, and we'll have in the coming months a conversation on how to extend the merchant book distribution agreement while the merchant book itself is already ours. So both parties, we have a strong relationship. You know where Banco is heading to, so let's say it's very difficult for us to provide any further comments. We are, I think, in strong position with both, in case I recall, and Montepaschi.

Thank you. Thank you.

Mr. Bertolucci, there are no more questions registered at this time. I turn the conference back to you for any closing remarks.

Well, thank you again for attending this call. And most importantly, looking forward to seeing you in early March for not just results, but for the capital market day. We plan to have in the same day a quick update on Q4 results, but then obviously look into strategy in longer term output for the company. And in that context, we provide the guidance for 2026 and also 2021. Capital allocation, our commitment for 2026 on the back of a very strong cash generation this year that is expected to land with 100 more million euro of cash generated versus last year. Thank you very much. I'm looking forward to seeing you over the next few hours and days in many conversations. Thank you.

Ladies and gentlemen, thank you for joining. The conference is now over and you may disconnect your telephones.