Scout24 Se

and so-called grey market initiatives, which already lead to an impressive number of increasing listings.

I will now switch from the revenues to our cost development. The development of our cost once again Three months after our Capital Markets Day, we continued to invest behind exactly the priorities we outlined. AI, product innovation, brand and the integration of Spain. Yet our organic cost base increased by only 6.4% compared with 10.5% organic revenue growth. Please note that you will find in the appendix to this presentation a detailed breakdown of our reported and our organic cost developments, separating the costs which are allocated to Spain into our organic core business. But let me highlight three examples that demonstrate the strength of our operating model and why we are confident that we can apply the same approach in Spain with the effect of an improving overall margin within the next two and a half years as we demonstrated it within our CMD. First, personal cost. Of course, our largest cost bucket declined by 3.5% organically in the first half, exactly what we outlined, reflecting our higher organization effectiveness, productivity improvements, and our continued transition towards a more AI-native organization. Second, organic IT costs grow by only 8.4%, way below organic revenue growth, despite continued investments in technology, automation, and our AI roadmap. At a time when many companies are experiencing AI-related cost inflation, we continue to fund innovation while keeping technology costs well under control. Third, marketing costs increased by 18.9% organically, exactly as planned, reflecting targeted investments behind our brand, new B2C products, and in addition, marketing costs were also impacted by the integration of Spain. Taken together, this demonstrates the scalability of our operating model. We continue to invest behind innovation while at the same time keeping organic cost growth way below revenue growth. Our organic ordinary operating EBITDA margin reached 64% in the second quarter. And please let me make one additional point on Spain. We are very confident in our ability to optimize the cost base over the coming quarters and we complete the carve out and integration into Scout24. We have successfully applied the Scout24 playbook across multiple acquisitions and we are already doing exactly the same in Spain. That gives us strong confidence that we will deliver a steadily improving margin trajectory over the coming quarters and years, creating significant long-term value from this acquisition. So continuing on the next page, where you can see that the items below our ordinary operating EBITDA developed favorably in the second quarter as well, supporting strong first-half earnings growth on both a reported and adjusted EPS basis. The non-operating effects were materially lower year-on-year, mainly reflecting much lower share-based compensation costs. But I will come to this item in more detail on the next slide. D&A increased moderately, reflecting the higher amortization of acquisition-related assets following the Spain acquisition. Our adjusted EPS increased by 18.8% to €1.97. outpacing revenue growth despite the expected dilution from Spain. Basic EPS also increased strongly to €1.87 benefiting from the lower non-operating effects. Overall, our first half earnings growth is another proof point to the scalability and quality of the Scout24 operating model. Strong operating performance remains the primary driver of earnings growth complemented by our Value Accretive Share Buyback program, which further supported EPS through a 3% lower weighted average share count. On page 18, you can see the bridge between our reported and our adjusted net income for the first half of the year 2026. Within these bridge items, there are four key elements I would like to highlight. First, our non-operating effects, excluding share-based compensation, declined significantly, reflecting mostly lower M&A-related costs. Of course, this was partly offset by continued PMI and restructuring costs as we implement the organizational transformation outlined at our CMD and build a more AI-native organization. Second, share-based compensation was broadly neutral in the first half. The positive effect from the release of the provisions for the LTAP payouts, which we made in the first quarter of 2026, were largely offset by new provisions in the second quarter, covering the new LTAP tranches for 2026 and also by an increased share price. Third, PPA DNA increased as expected. reflecting the higher amortization of acquired intangible assets following the Spain acquisition. And finally, the financial result benefited from around 4 million euros of fair value gains on our VC fund investments and approximately 2 million euros from the revaluation for the Sprengnetter call options. So before I will come to our cash flow and our capital structure, Please let me first put today's results into the broader context of our CMD. As I already said, after my first five months at Scout24, I am absolutely convinced about the quality of the business and its long-term potential in the light of our CMD and our presented strategy of the agentic operating system. If you go back to our CMD in 2024, we had a clear strategy, a strong operating model and ambitious financial objectives. Today, I believe the opportunity is even larger. Not because our strategy has changed, but because the business itself has become stronger and supported by continuous important strategic investments in our ecosystem. Over the last two years, we have consistently executed, delivered on our commitments and proven that our operating model scales. But perhaps the biggest difference today compared with our capital markets day in 2024 is AI. Two years ago, it was a strategic ambition, which we already highlighted as a key pillar of the future development. Today, it is becoming a major part of how Scout24 operates. AI helps us build better products, deepen customer engagement, and most importantly for a CFO, creates new monetization opportunities. At the same time, it enables us to innovate faster, automate more processes, and significantly shorten the time from an idea to customer impact. In other words, AI is strengthening both sides of our P&L. It supports sustainable revenue growth while making our operating model even more scalable and increasing our operating leverage. Combined with our industry-leading subscription businesses, expanding monetization across the customer journey, and our proven ability to integrate acquisitions while expanding margins, I believe the foundation of the business is stronger than ever. For me, the most important change since our CMD in 2024 is that our growth drivers are no longer developing independently. They are reinforcing one another. Better products drive stronger customer engagement. AI accelerates innovation and efficiency. A scalable operating model translates those advantages into consistent financial delivery. That is why I believe Scout24 is becoming an even stronger compounding model for shareholders than we have seen two years ago and why I am so confident in the opportunities that lie ahead of us. Turning now to page 20 and our free cash flow development. Starting from a net income of €132 million at the end of the first half of last year, free cash flow amounted to €101 million in the first half of this year. The main driver of the year-on-year decline was around €25 million of LTIP cash outflows, reflected in working capital and provisions relating to incentive programs from previous financial years. Excluding this effect, free cash flow would have increased year on year, underlying the strength of our cash generation. Cash conversion remains strong at 73% of adjusted net income and 45% of ordinary operating EBITDA. Turning to leverage and capital allocation. During the first half of this year, we deployed almost 400 million euros of capital across strategic M&A, share buybacks and dividends. To remind you, we paid a dividend of 105 million euros in the second quarter and we already bought back more than 1.7 million of shares in the first half of the year with a cash consideration of 123 million euros. By the end of the first half of the year, we had more than 3.8 million treasury shares, representing 5.25% of our share capital. As you know, we are currently running another share buyback tranche in the second half of the year, with an outstanding buyback volume of around 220 million euros today. In addition to the free cash flow generated during the period, these investments were funded through a 300 million euros short shine or in English promissory note issued at attractive terms and additional debt. As a result of our investments in M&A, share buybacks and the dividend payout, our financial leverage increased to just 0.99 times at the end of the second quarter, leaving us with significant financial flexibility. So let me conclude on page 22 with our guidance. Based on our strong first half year performance, we are of course confirming our full year guidance for 2026 with a very high level of confidence. We continue to expect revenue growth of 16% to 18% including around six to seven percentage points from Spain and an ordinary operating EBITDA margin of up to 61% or up to 64% on an organic basis. Let me make a few comments on phasing. Based on our first half revenue performance and the outlook for the second half, we are currently tracking toward the upper end of our revenue growth range. As always, we will provide a more specific update with our third quarter results when we have even greater visibility for the remainder of the year. On profitability, the second quarter already demonstrates the strength of our operating model with a group-level organic operating EBITDA margin of 64%. This reflects the efficiency of our German business and our proven ability to expand margins following acquisitions. The path towards our guidance of up to 61% reported operating EBITDA margin will continue to build through the second half of this year. This will be supported by lower TSA costs in Spain, continued optimization of the Spain cost base, and further efficiency gains in our German business as we continue the transition towards an AI-native organization.

Based on our track record of integrating acquisitions and executing PMI programs, we are highly confident in our ability to deliver the same outcome in Spain.

Consistently delivering on our commitments while improving profitability has become a hallmark of the SCAR24 business model and we are confident that 2026 will be another example of that. Thank you for your continued interest in SCAR24. Ralf and I are now happy to take your questions. Please limit your questions to two questions per speaker. I will now hand over to the operator again and thank you for your interest.

Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touchtone telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only handsets while asking a question. In the interest of time, please limit yourself to two questions. Anyone who has a question may press star and one at this time. One moment for the first question, please. And the first question comes from Ed Young from Morgan Stanley. Please go ahead.

Good afternoon. My first question is on private subscriptions. Could you give a bit of colour on the churn during Q2? You obviously entered and exited at a higher number than the average during the quarter. So what's caused that? Was it concentrated in any particular packages or cohorts? And how should we think about growth in private subs coming out of the period? And then the second question is on AI. You mentioned on the consumer side, you've seen Search interactions increasing nearly 50 times year on year. I just wondered if you could give some color on whether you're seeing any change in the consumer behavior or any associated increase in engagement or paid conversion or leads being sent to agents. Thanks.

Yeah, hi, I feel happy to take your questions. I mean, in the private business, what we can say is that the We exited the Q2, so the numbers in June are 522,000 subscribers on the consumer side, so plus subscriptions. And this is actually a positive development. So we are accelerating our subscriber growth compared to Q1. And this is something we see is possible to continue in July already. We see higher numbers here as well. So if you sum it up and you take the one way, the current one we have, then we would land double-digit revenue growth. So therefore, we are quite happy with the progress we are making. I mentioned it last time. Maybe to give a bit of context of the number I mentioned in the last call where I said 530,000 in April, that was the test we did where we did a win-back campaign. In April and the campaign actually was quite successful, but we decided and led to subscriptions of over 530,000 in April, but we decided in May to take the campaign down and not to count the customers from that campaign into the subscriber numbers. So as I said, 522,000 end of June. This is really sustainable growth. And we are making progress, as I said, and can accelerate the revenue growth for the private business. That was question number one. Question number two was regarding the AI usage of the audience. I have to say we are quite happy. We see that the people are more engaged if they are using our AI features. That's true for both, for consumers as well for professional customers. If they are more engaged, actually what they experience as a consumer or as a user of it, they experience a better matching experience. And so that means their search experience becomes better. Se, Filip Lindvall, Martin Mildner, Claudia Viehweger, Christian Ronge, Gertrud Kolb Some efficiency on the search experience and our professional customers, they get a better quality in terms of leads and contact requests.

Okay, thank you.

Then the next question comes from Adam Berlin from Goldman Sachs. Please go ahead.

Hi, good afternoon. My first question is on ARPA in the professional business, which grew 10% in the first half and in the second quarter. Can you give us any colour on the drivers of that 10% ARPA growth? How much of it is coming from upgrades to these new AI-powered tiers? Is there any kind of diminution of ARPA because of the new subscribers? How much is just price? Any color you can give us on the kind of drivers of that 10%, that's the first question. Second question, can you give us an underlying growth rate for the Spain business, please? Revenue growth.

So, yeah, I can start, and maybe for Spain, Martin, you can put some color on. So, yeah, if it comes to ARPA growth, I mean, it's always a mixed... on value in the packages. So we see customers upgrading their memberships into the higher tier. We are also migrating customers from the old membership world into the new one. Still, we do upsell with ImmoPoints for AI features. So what we see actually is that we see higher perception or higher usage of AI features on the B side. And we see that we are able to monetize those AI usage or intelligence usage via ImmoPoints. I think we disclosed the revenue review with the Immopoints and it's really a strong growth here and you see that and this is actually driven by AI features. So yeah, this is what I can share. Other than that, we are not disclosing actually. But yeah, I mean, APA is not just driven by here price increases. I mean, this is not the approach we follow. As you know, we have here a different approach. We call it responsible pricing. So most of the Martin Mildner, Christian Ronge, Gertrud Kolb

and more from a 30,000 feet perspective on Spain. You know that we took over Spain in March and we are now really working on the integration of Spain and putting, as I said in the call or in our script, and putting the playbook of Goal 24 on Spain. And there are some homework to do. So therefore, currently you see that we are roughly having 5 million euros per month on the revenue side in Spain if you count it up. from March onwards. And we said over the entire year for 12 months, and you know that we have only 10 months in our books for this year, but for a 12-month period, we said that we'd like to achieve 60 million of revenues in our press release in September last year. And we are, as we said, quite confident that we are reaching these numbers. And currently our focus is really to have the same playbook as here. and to have much more longer contracts with our customers, which leads then also to more subscription safe revenue model where you have an increase month over month. And as we said in other courts, currently Spain is structured in a much different way than we are doing our business. So the contracts are much shorter. You have sometimes the dip in the month over the Some are where the contracts are canceled and we are now turning this into our model where you really have more long-term contracts and therefore I would say please give us some time for this year to make the transformation and to see then in the next year that the playbook is the same way as in Germany and that we then have also having not anymore the TSA transition cost that we have more synergies but overall we clearly focusing on our 60 million run rate for an entire year multiplied or divided by 12 multiplied with 10 months but I think this is where we are approaching for the full year and we are really focusing on getting the costs under control and having cost reductions by TSAs but also by having synergies. I apologize that I had a broader view on this but maybe this takes you a little bit looking also in the Spain business.

Yeah, that's helpful. Thank you.

Then the next question comes from Doinzola Ojo from Citi. Please go ahead.

Hi, thanks for taking my question. My first question is on InnoPoints. I think we saw that 60% of customers are now using them. I understand that usage is expected to grow but can you give us a bit of colour on where you see penetration reaching and maybe what AI features are most popular and then on Spain thanks for the underlying colour but it would be helpful to understand how growth is what's driving growth is it more so membership growth or is it pricing and then on the share of advertising in Spain I think the plan was to take down the share of Advertising as a share of revenues. Is that still the case?

Thank you. I start with the ImmuPoints. So the way how it works, I mean, we presented it at the Capital Market Day that we established ImmuPoints as our currency within our ecosystem where people can consume additional services and AI features in this perspective additional services. In the moment where our customers consume more intelligence in the system because we are creating or building or we build partially our ImmuAI system. So in the moment where people consume intelligence, for instance, if they want to create a virtual staging or if they need the floor plans, AI build and so on, then they have to use ImmuPoints for that. And actually all the AI features in particular, they will drive the ImmuPoint consumption. and we see that this is working. What it also drives is the multi-product usage for our customers. So in our ecosystem, we have many different products here. They are all in a way connected to each other, so you can Thank you very much. Ideally, we will see more usage coming with that customer because you mentioned the number. Hopefully, in the future, more customers will use ImmoPoints. They will also commit to ImmoPoints. So it's not that we want to have recurring revenue even with the ImmoPoints here. And we also see that we are able to bring more and more products on this model where we monetize the intelligence. as more products we are adding to our ImmoPoint universe so that you can pay with ImmoPoint as more, let's say, revenue we are going to see in the ImmoPoint revenue line. So, yeah, this is what I can say to ImmoPoint. On Spain, what would drive revenue? I mean, Martin just mentioned it a bit. It's actually the normal classified playbook They have memberships where you need to grow in customer numbers, where you have to add some on-top products to it. Hopefully customers will buy it, but this is actually what we have to establish in Spain. Many of the contracts we have in Spain with our professional customers, they are not long-term, they are short-term contracts. But if you move, let's say, the customers into long-term contracts, of course the volatility for revenue will go down. in particular during the summer. And this is actually what we want to do there. As I said, normal execution of the classified playbook. You asked about the advertising revenues. I think we said it in one of the other quotes already. Actually, we want to become more independent from those advertising revenues. I don't know. I don't have the exact number so much it is at the moment from the revenue side. Do we have it? So we want to focus because it's important in particular if you are the number two in the market that you have a good product experience. The revenues are not that big so ideally we can replace those revenue easily if we are doing a good job on the membership side here for professionals and that's actually the strategy.

Thank you. Maybe just one tiny follow-up. On the IMO points, using the AI features, I think it was asked earlier, can we get any sense of how much that is driving ARPU?

Do we want to disclose this? No, not yet.

What we can say is that IMO points is growing very fast. We started off in 24, we came out with the concept at the CMD and today we're doing over 3 million run rates, so that obviously gives you a feeling for the growth and it's obviously growing materially faster than the membership line overall, so it has a net positive contribution to ARPU.

Thank you very much.

Then the next question comes from Craig Abbott from Kepler Schifrö. Please go ahead.

Yes, good afternoon. I'd like to just come back, please, to the private segment. Thank you for sharing some color earlier on how you're thinking about the subscriber growth developing throughout the back half of the year. My first question would be, how do you see those marketing costs developing and kind of like the EBITDA margin progression we should be thinking about? And the second question is there, maybe it's not that material, but I would just like to gain some more color, please, on the landlords. Se, Filip Lindvall, Martin Mildner, Gertrud Kolb

As you probably know, we tested a lot in the last couple of months on the product side. And of course, if you are introducing a new product here, you have to do some marketing around that. So this is actually what we did, and that's what you can see reflected in the marketing here. So we had to promote a bit the product features. We had to explain them to consumers, but also to professional customers. If they are receiving a lead here, what's the difference? What we see already, and this is what I didn't mention before, we have in the highest tier at the moment, there's a new AI features in our application assistant. So with this assistant plus Seekers, they can apply automatically for relevant applications. Thank you very much. One to be faster than the others because it was a bit the issue that the product became commodity here in Germany. So this is what we have changed. And this is good. And of course, we had to do marketing. Other than that, I think we reconfirmed today our margin guidance. And of course, this is what we will deliver. And yeah. And this is. That was number one. Number two was the landlord product. I think you said it correctly that the stickiness of homeowners using the product is higher in the paid product, but the entry product actually is a free product for homeowners. What we see in this free bucket, let's say that we were able to increase the engagement here. This is important because if you want to do upsell into paid products, you need to have engagement on the free product first. But we still have to do some work here on the product. It's really in the early stage. It's a bit like what we did with the Plus products 10 years ago where we had to shape the market. It's the same here on the homeowner side. We are really happy with the content homeowners delivering to the platform. Now, we have 6.5 million properties in our homeowner product. And this is actually content no other portal can offer to Seekers. And to give Seekers access to this content is really an advantage for the platform. So there's not just value in monetizing homeowners. There's also value for the Seeker side and also for Plus subscribers. So, therefore, from the content contribution topic or perspective, we are really happy. If it comes to monetization, there's still potential. And we, as I said before, we have to shape the market here first. Hope that helps.

Okay. So, it does. And if I take a step back and look at your overall plus portfolio, That's like you're developing the subscriber base there. You already use the content also across to your other products. But in terms of driving the actual revenue line and therefore also the EBITDA line, it's the other plus products with potential in the future to come from the landlord product. Is that the way we should think about it?

Yeah, I mean, at least, I mean, you said from the strategy perspective, you would like to move deeper into the grain market as more Thank you very much. Ideally, the landlord or homeowner product is driving plus subscriptions at the end. But it's not the only, let's say, feature we have in the pipeline to drive plus subscriptions. There are also other things we can imagine. For instance, we have the product that's called Living Plus. Ideally, we have products where people move from the search phase into the living phase and we stay relevant for those users. So if we are successful with that, then we can expand the lifetime from today's six to 12 months into eight months because that's the average lifetime of a tenant here in Germany.

Yes, very helpful. Thank you very much.

And the next question comes from Will Packer from B&B Paribas. Please go ahead.

Hi there. Many thanks for taking my questions. Two for me, please. Firstly, thanks for the framing on the new home segment. It does sound somewhat familiar from what we've heard in other markets where eventually the supply crunch feeds through and results in more disappointing classified revenue. Could you remind us what percentage of professional revenue is generated in new homes? And then perhaps frame a little bit more on So, what we see...

Let's start maybe with the vent side and then on the new homes. Filip will give you a bit of details and background here. As many other markets in Europe, the real estate market at the moment, they are challenging, not just on the new home. The overall demand for properties in Germany is going down. But we are participating here. So we are gaining market share because the percentage, which is, let's say, where the demand is going down on our website is lower than it is with the competition. It shows us that we are even able in tough markets to grow market share. And one reason for that is that we are able to deliver content others cannot deliver. So this exclusive content strategy we presented First in 2024 and now we are executing along this and we updated the strategy on the capital markets day this year as well here. I think it's paying off now. So people appreciate that they find content which they cannot find on other portals and therefore we can win market share here in this rent space in particular, even if the overall demand for rent properties is going down in Germany. So on a new home, Maybe, Filip, you can, because we have the numbers, you can share it.

Yeah, yeah, well, and actually the reason we put in the slide we wanted to talk about the story is that we're actually able to, we want to show that we're able to grow in all the markets across cycles. This was also a topic at the CMD. And one of the reasons is that we offer products for the entire transaction flow. So it's much more than just marketing. We're deeply integrated into The workflows of these customers and actually even some products where we just share the transactional upside with the customer. So we're not charging anything upfront. So we have a flexible approach. And what we wanted to say also on the slide is that our membership business continues to grow through this cycle. And we didn't put the numbers specifically, but our new home builder business and developer business is growing around 15% year to date. That's obviously very Strong numbers, and in terms of the total pie, slightly less than 20% of the membership business.

I mean, there's one effect maybe you can also put into consideration is that the square meter prices to build new homes, they are still increasing here in Germany. So that leads to high Thank you very much. It's the other way around and they need more marketing support here as well. And they need also more intelligence. So targeting the right buyers and finding them in the ecosystem, that's also what we do now. We are doing specific campaigns for developers. And that's how we can grow the business even in challenging times.

Thanks for the call on.

And the next question comes from Annick Maas from Bernstein. Please go ahead.

Good afternoon. My first question is going back to private subs. If you could give us a little bit more granularity in between how many are coming from subs having signed up to the new Search Plus tiers versus Living Plus, given you call out Living Plus as having grown quite strongly in your press release. And the second one is on Spain. You keep on repeating that you want to repeat the playbook of Germany, which I guess, as you just highlighted, includes having products for the entire transaction flow. So in that context, how shall we think about the Spanish M&A envelope over the next years? Respectively, what type of assets do you think are most relevant owning quite quickly in Spain? Thank you.

So I think about how to start. So maybe we start with the M&A in Spain. I think, first of all, I mean, from my perspective, there's no pressure to do an acquisition in Spain in order to complete something. So first of all, we have to integrate what we acquired. We have to bring it to a situation where we see sustainable growth. So that means we see... Our famous revenue ladder where we do every month more revenue than the month before, where we see growing customer numbers, where we also see some innovations on the product side. And those innovations, of course, we can use, we can copy those innovations from ImmoScout here in Germany. That's actually what we would like to do. Do we need, let's say, we have an agent software product in Spain as well, so we don't need to acquire it. We also have access to real estate valuation data in Spain, so we don't need to acquire it. If it comes to audience, I don't know. This is something, of course, we have to watch out always. It's the same what we are doing here, how the audience channels are changing, where they are going and so on. But there's no, as I said, there's no pressure to do something here additional. And first of all, we would like to show that we are able to integrate the Fotocasa business into our Thank you very much. We don't want to go too close to any detail because it's also relevant for competition. But what we can see is that the tiering we did, and you see it in the APU development for the plus subscriptions, right? But we see that with the higher tiering, we are able to drive APU. And we are also in parallel, and that's what we tested a lot in the last couple of months, is that we need to find a path back where we can grow customer numbers. So, and Living Plus is helping here because we are extending lifetime from those who found their apartment because the biggest complaint of Plus subscriber is, oh, I found my apartment, I don't need Plus anymore. So, and therefore we're working heavily on this Living Plus product, but it's not easy to find, let's say, a value set for customers that they stay for what I mentioned before, 80 years in this product. So it cannot be just insurance products or so what we have today. So we need to add more. Thank you very much. For us it's important that we are able to show that the subscriber numbers are going up and at the same time that we have a positive ARPU impact. This is actually what we could deliver for Q2 and now we see that this is accelerating further. The times are over where we are growing 40% every year on the private segment. What we see now is we are able at least to grow double-digit as we are able to do in other parts of the business. That's important in order to maintain the double-digit revenue growth for the company in some. And so therefore, we are happy with the development.

Thank you. Thanks.

Then the next question comes from Joe Barnard-Lamb from UBS. Please go ahead.

Excellent, thank you very much. Yeah, a couple of follow-ups from me. One follow-up on private membership of this 530,000 in April. You explained that you'd stopped a temporary win-back promotion. Can you just give a bit more color on what happened here? As I think the April number you mentioned last time has led to some uncertainty today. So what exactly was that promotion and why did you stop it? And then the second question, also a follow-up to the conversation around private margin and the marketing investment. Do you plan to continue these marketing investments in 2H? And do you think that 2H private margin will be down year on year driven by those investments? And I guess related to that, consensus sits at 61% for the group. With this investment, is that achievable? Thank you.

Thanks, Joe, for your questions. Quite good ones. So, I mean, the campaign was regarding Thank you very much. So we decided, is it good enough in order to deliver sustainable growth for the business? Where I said, look, we need to show every month that we are able to add customers to our subscription model. And therefore, we decided actively not to continue that. And yeah, so I mean, the numbers in April, if I remember right, it was close to 540,000 with the This is campaign. So, but it turned out, as I said, that the sustainable growth out of this bucket was not as we expected or wanted to have it. And therefore we stopped it. So, but as I said, so this is the baby. So then we see baby shoes. have chosen, we exited the quarter with 522,000 subscribers. And this number is quite promising because in this bucket, the revenue and also the subscriber growth is sustainable. And so therefore, the quality here is better. And yeah, so sometimes I understand that there was quite a bit of uncertainty because also learning for me that I have to be careful with what kind of numbers I'm sharing in the Q&A session. but because this number was not disclosed officially but anyway so I can understand that there was a bit of uncertainty but I also said last time and this is true we are testing we are shaping here a new product set into the market therefore we have to do marketing yes and therefore the margin was not as it was before for Q2 but we are We are quite optimistic that we are able to bring the margins back to it, as I said, because if the product is flying and if the product is established, we can deliver the margin profile we had before. And please remember that, I mean, now we are talking about margins above 60% for the private business. As we started, there was margin below 20%. and you were asking me all the time are you able to deliver margin profile the core business has and now we are dropping a bit because we did a bit of marketing and everyone gets nervous. So I think it's now on us to bring it to the next wave of revenue growth and that's what we're working on. So and this will take some investment temporarily and this will also take some marketing spend temporarily.

Thanks for the call, Ralf. Cheers.

And the next question comes from Markus Siebel from JP Morgan. Please go ahead.

Yeah, perfect. My question was in the same direction, just to finish really private now. So are you saying with where you stand now, you commented that July is getting better, so is July customer numbers, are July customer numbers already better than the 522 in June. Just to clarify on this and then on the marketing line and the appendix you show that marketing was up organically by 19%. Is that then, given what you just said, probably the right number also for H2 or is marketing organic growth coming down in H2? Thank you.

Yeah, so let me start with the ask for how many subscribers we have in July. So we see that the numbers in July are, so we have 528,000 subscribers here, so it's higher than what we had in June. So as I said, the subscriber growth is quite sustainable, and we expect that this is going to continue in August and in the following months as well. And what's quite positive here, as I said before, is that if you take the revenue run rate we have and if you compare this revenue run rate with the Q1 revenue we had this year, there's double-digit revenue growth already. So the question is, are you able to grow double-digit in private next year? The answer is clear yes, because run rate is already on double-digit. Therefore, for me, private is Thank you very much. But, you know, I cannot really give a 100% guarantee for every, let's say, cost line. We need to have a bit of a wiggle room here. So as long we deliver what we promised, and that's our main focus as a management team, that you get the certainty that we deliver what we promised and this is what you always got. And even today, right, I was quite surprised of the share price action. Now I understand better why. But I mean, this is the best result we ever had as a company. And so, and we are one of the Se, Filip Lindvall, Martin Mildner, Claudia Viehweger, Christian Ronge, Gertrud Kolb I understand the questions on private and the uncertainty with the number I gave in the call earlier this year. But again, I think from the margin profile, there's potential. We deliver what we promised this year, and I'm quite confident.

Perfect.

Fair enough.

Thank you.

And the next question comes from Andrew Ross from Barclays. Please go ahead.

Great, good afternoon guys. I've got two on private subscription you'll be pleased to hear. First one goes on the ARPU side. Can you update us on what the distribution is between standard pro and unlimited in terms of what percentage of subscribers are on each tier and then what you've learned so far about ability to upsell people as you layer in new features? It sounds like the early understanding of what's happening in unlimited with the AI features is positive but also curious in what's happening in Pro, given features you added in earlier this year. That's the first question. Then the second one, I hate to go back to these numbers on private subscribers, but clearly for the average of Q2 to be 517,000, equal to be over 530,000 and recorded to exit at 522,000, the low point must have been quite a lot lower. So how low did it go and when was it? And I guess what we're trying to build is a picture where It troughed, and then now you've seen a period of kind of sequential reacceleration to get comfortable with kind of through the worst. And when we think about the rest of the year, that this five-minute subscriber number starts going up into the right again. Anything you can do to help us with that would be useful.

Sorry, Andrew, I didn't get the last question fully, but maybe we start with the product split for for private since we did the tiering. So, I mean, I hope you understand that, as I said before, we don't want to disclose here the details because it's relevant numbers or it's relevant information for the competition as well. So what I can say is that the APU in the highest tier, you know, it's double. And if you take the APU goals we delivered in Q2, you see there is already some impact coming from the highest tier. And the reason why people choose the highest tier is because they perceive their values in there, that the value is higher than in the lower tiers. Since we implemented in the highest tier the AI application manager, since then we see an uptick in conversion into this higher tier. Therefore, our working assumption actually is if we are able to create this extra value in the highest tier, we can grow this number further. and with that we are able of course to drive the ARPA number because we know that this is now more important where we are not going that fast on the subscription numbers as well. So back to subscription, I think I explained twice the reason why the 530,000 I mentioned in the Q1 call was what the reason is for that. So again, so we expect now with all the products and measures in place that we are able to deliver sustainable customer growth on the subscriber side month over month. So that's actually our aim. So I cannot promise 100% that this is, but we see all the indicators at the moment are going into the right direction. And you can see if you compare Q2 with Q1, you see already that we are accelerating here. So therefore, we are on a good track, I would say. So give it a bit more time, and hopefully in Q3, then we have also another data point that this is possible to deliver. All what I see at the moment in the forecast and so on, and also in the numbers for July in particular, what I shared before, that we see this growth in subscriber numbers. So the other question regarding the last one, the last question We got in the number of subscribers, and we're sorry. That was the last one, yeah.

But just to be clear on that point there, Ralf, so if I go through Q2, it was a bit over 530,000 in April. It must have dipped closer to 500,000 or so in May, and then it's improved up to 522,000 at the end of June and 528,000 in July. Is that roughly the shape of what's happening in Q2? No, it's not.

The 530,000, that's what I said before. I mean, the 530,000 was because we did a campaign for Winback and cross-selling. And this campaign was driving the numbers even above the 530,000. What we did then is we decided actively in May not to count those customers from the Winback and cross-selling campaign into the subscriber numbers because we saw that the... For instance, revenue and value we are getting from this, let's say, group of people or from this bucket was not as sustainable as we thought. So therefore, we said it makes no sense to continue with this campaign, even if the campaign is delivering more subscribers, because this will not be sustainable. And therefore, the 530,000, I mean, we delivered more than 530,000 subscribers. But again, we said, look, don't count those customers into it. And then we corrected the numbers then in May. That was actually the reason. So there is no dip in subscriber numbers or so in May or June. It's the other way around. If you look into the details, and as I said, we didn't count the customers in from the campaign. You see an uptake in the numbers from May to June in particular. So yeah, that's what I can say.

Thank you. Back on private business. Ralf, did you decide to make the additional marketing spend following the decision to end the win-back campaign?

Secondly, you mentioned in the prepared materials that as a result of these initiatives in private, you got 35,000 more listings. Can you explain why these marketing initiatives result in more content, especially if they're focused on the grey market initiative, which, as far as I understand, sits within your subscription products? and the waiting list and the tenant network. And those don't actually create private listings. So I probably got it wrong. So if you can educate me why those marketing initiatives result in more listings. Thank you.

Yeah. So the marketing center is not connected to this CrossSell and Winback campaign. If you do Winback and CrossSell, usually you take customers who terminated their contracts or resigned. So actually, you don't need to spend extra money here for doing a campaign on that. So the extra marketing money we did is in order to promote the different tierings we had and to do tests for the different tierings. Because if you launch such a product, you cannot use 100% of the traffic we have on the website. So we decided to buy traffic from external in order to test the tiering in a way which is helping us to assess the product. So that was actually what we did. And so on the other question was regarding the... How do you arrive? The tenant-to-tenant network is what we launched, right? And tenant-to-tenant means, I mean, if you are a seeker, you're looking for a property, you probably live in a current apartment. So hopefully you are not homeless. So you have an apartment. And this is something people trade in. So tenant-to-tenant means that... If you want to get a better position, I mean, in the market as a seeker, you can trade in your current apartment and that creates a grey market listing as well. So since we have the tenant to tenant network, there's a kind of communication between the two tenant groups here. And if you look into the, let's say, local markets here in Germany, let's take Berlin, the number of There are apartments where people say, look, I mean, I have an apartment here and I'm looking for another apartment, but I only give you my apartment if you give me the other apartment. So this trade-in, trade-out model is expanding here in Germany in the regional markets in particular. Now we have a product, so everything is going via our platform and we are able to flag those extra listings in the platform and we give access to those listings and also then access to the landlords which are behind those listings. And that's what we do. And on the other hand, landlords, we have registered in our homeowner hub, right? There's also, let's say, if they know that the apartment is coming to the market, they are able to use our Let's say tenant network to collect the right potential tenants they would like to approach for their apartment. So what I said before, we're trying to create a situation where we can offer a better matching between the two groups, between the landlords and the tenants. And if the tenant, let's say, has an apartment he can trade in, even better then. Things don't

become publicly available on the platform for anyone to see? Do they?

Yeah, yeah, becomes, but of course you can say, look, I mean, only plus subscribers, they get access first to the tenant-to-tenant listings because there's also high demand for those listings. So you can usually, you can use our playbook we have on the plus subscriber site in order to drive More plus subscriptions and to deliver better quality even to those who trade in their apartment they live in.

Okay, thank you. And just to follow up on the marketing and to come back to a direct question that was asked earlier, do you think private margins will be higher in the second half than the first half?

I'm not steering like that, sorry. I said that before. I mean, we gave you a guidance for the company. We gave you a clear margin profile for it, and this is what we're going to deliver. I mean, I cannot be a business if I give you 100% guarantee for every cost line. Sorry, this is something I cannot do.

Understood. And the next question comes from Nitzler Neisser from Deutsche Bank. Please go ahead.

Great, thank you. So I'm moving away from the private business, if that's okay. And my question's on Spain. Could you tell us, Ralf, based on what you've seen in the country thus far, what do you think the optimal margin level could be for Spain in the next few years? And is the improvement in the Spanish margin baked into the midterm margin guidance that you've given us in the last capital markets day? So just to understand what was in, you know, the 64% by 2028 EBITDA margin target, that would be great. And my second question is on the professional segment, the customer growth is better than we expected in Q2. Could you remind us, you know, where are these customers coming from? And do you expect the customer numbers in Germany to continue to increase in H2 as well within professional? Thank you.

Hi, Ms. Martin. Thanks again, first of all, that you are driving from Prague to Spain, but even Spain is not so big. But regarding the EBITDA margin, the improvement of the EBITDA margin, so what is the right margin? I think we will see it. We will improve it. You saw from our presentation where we had in the appendix some kind of The separation of our organic costs and our costs in Spain and that we said also that they are currently burdened by the TSA costs and that we are driving the TSA costs down and that then the margin will improve. And with respect to the overall margin within our capital markets day guidance, I think It is clear that the improvement of the Spain business will also have an impact on our margin improvement. Remember that we also gave you on one chart some indication how we would see the organic margin on the German business and how we will see the overall margin. And maybe I recall that the overall margin was for the entire business, including Spain, back to 64%. And we said in the barrel Ladies and gentlemen, this was the last question for today. I would now like to turn the conference back over to Filip Lindvall for any closing remarks.

This concludes today's call. Thank you for joining and your interest in SCALE24.

Ladies and gentlemen, the conference is now over. Thank you for joining and have a pleasant day. Goodbye.