Teleperformance Ord

Hello, and welcome to the teleperformance first quarter 2025 revenue. My name is George. I'll be a coordinator for today's event. Please note, this conference is being recorded and for the duration of the call, your lines will be in the listen-only mode. However, you will have the opportunity to ask questions towards the end of the presentation, and this will be done by pressing star one on your telephone keypad to register your question. If it requires assistance at any point, please press star zero and you will be connected to an operator. Please also note the disclaimer on page two. The conference will be hosted by Mr. Olivier Rigaudi, Deputy CEO at Group CFO, and Mr. Thomas Mackenbrock, Deputy CEO. I'd like to hand the call over to Mr. Thomas Mackenbrock. Please go ahead, sir.

Thank you, and good evening, everybody, also from my side. It's a pleasure to be with you and share with my dear friend Olivier our Q1 results. Unfortunately, we cannot be in the same room today as I'm traveling in Asia, but we'll manage nevertheless. As you can see, and as you probably have read, we are very pleased with our Q1 results. And I think it's important to start with the four main messages. Number one, as you can see, we reported 2.8 growth for the first quarter and on a like for like basis it's 1.6 respectively 2.6 if you adjust for the visa application contract that was not renewed as we explained in february this is in particular strong if you compare to 2024 which was a leap year i think we referenced to this also in february where we had one working day less What in particular excites me is our very strong momentum across the board for core services. On a global level, we're growing 2.3% like for like. If you look, for instance, at EMEA Asia or Africa, that region, we are growing close to 4%. And there are a lot of, let's say, positive momentum in the business. That's why, as we indicated in February, we also seen an acceleration of that growth throughout the year. Specialized services, we are very pleased that we have completed the acquisition of ZP in February this year. And with ZP together, we are reporting growth of north of 10% on a like-for-like basis. Obviously, as we lost the Visa business, it is smaller. Second point. Majorelle integration as well as the reorganization of TP France is well on track. We will report over 20 to 30 million synergies this year that comes on top to the report in 94 of last year, and we submitted the voluntary plan to the French authorities. Thirdly, as you remember, we announced in February a new AI partnership program. The idea is to build an open ecosystem with leading AI companies around the world, really trying to find the best of breed companies and work with them and collaborate with them when it comes to further enhancing their product and their go-to-market. after Sanas, which was an accent translation tool that we used to enhance our human colleagues around the world. We are very excited to have two agentic AI companies now part of this partnership program. If you remember, we have this notion about human augmented by AI and AI. And as we are the orchestrator and integrator of human AI-led services, We're very pleased to have Emma, that is in a horizontal AI, agentic AI company, and Paloa, who's an agentic AI company, focusing on customer services as part of our group. Fourth point, given all this good news, we're very happy to confirm our financial objectives, and Olivier will share later a few more details. Let's look now at these different elements in a bit more detail. As you can see on the next page, our core servers, as I said, are really in good shape. And just now in India, India remains a key driver for our growth momentum, but also the UK, the Middle East, Egypt, South Africa, Turkey, Latin America, so really across the board. A very strong momentum. As you can see, EMEA APEC, our business segment, 3.8 like for like. Americas, we see in the actual U.S. some degrowth and some deacceleration, but overall still plus 0.8% for that business segment. Specialized services with ZP together close to 11%. If we adjust now on a like-for-like basis without the loss of the visa renewal, we are at close to 4%, and including the visa renewal service, as indicated, if you do the math, minus around 2.4%. In particular, when it comes to language line, as we indicated, we have a very... close eye on this volatile environment in the U.S., and we're managing this quite closely, but do expect, obviously, for the further course of the year, in particular in the second half, some further acceleration of the growth. Let's move, I think, best drawing nearshoring. No surprise there. We see more momentum in particular in multilingual hubs than offshore locations. ZP together, we announced end of February that we got the approvals and completed the acquisition. We're very happy to report that now the integration process is well underway. Synergy's program is launched, obviously, for IT reporting. Cast management, Olivier, was a few weeks ago also on the ground to kick off all the Synergy work streams. So there we are in good shape. And also important to note, as we're now reporting the numbers for the first two months, It's really well in line with our business plan, and we're very happy to have the whole ZP family part of the TP group. Let's move on. Here, as you remember, we are an orchestrator and integrator of four things, managing, emotional intelligence with our colleagues around the world, and we continue to invest in their skills and upskilling to drive know-how on the AI side, as well as the AI and the emotional intelligence side to create deeper human connections. We continue to focus on process excellence because that's the core of really of the DNA of TP now for over 40 years to best in class of managing processes at scale and how to implement now all the new possibilities with AI in our process excellence. So there we are also full on track with the global rollout. Thirdly, technology. We continue our internal transformation. We just did a review the last three days in India on all the tools and AI microservices that are implemented on a continuous basis in our client operation. How do we use our tools to augment for more efficiency, more quality our day-to-day operations? And we will continue to drive this internal transformation. And secondly, on the partnership side, I will say a few months later, we are very happy to have these two new companies board. And fourthly, domain expertise. We will move into more and more verticalized VPU operations. We see sustained growth in our non-voice activities, whether this is back office, BPO, analytics, trust and safety, consulting services. So that's really great to see. And we want to build on this. So we're investing in people, know-how solutions on the verticals we really see promising, like BFSI or, for instance, finance and accounting services that we want to expand further. If we now turn the page and see on TPAI as presented in February, we have these three growth factors. One, AI data services. This is one area where I particularly pay attention. We want three new client contracts, so that's great to see on AI data services. And we're also investing here in data services capabilities to really hone our know-how for how to train and to be a good operator and partner for the AI companies when it comes to data quality. tp infinity our more consulting technology led arm we see wins across analytics technology consulting i'm personally quite excited about the wins in analytics we really have a great know-how to implement analytics in our existing operations and we want to drive that capability that exists that's part of tp also for broader use cases outside of our existing operation Second comment here, we continue to invest on technology capabilities. So how to integrate IT as a service, technology as a service. We have done this successfully in particular in the Middle East, and we're expanding this know-how also now to the U.S. market. And for TPAI solution, you remember it's our own solution that we use for microservice in our operations is working with our partner ecosystem. And we continue to do so in building a more targeted ecosystem with AI companies that we want to create win-win solution in orchestrating human and AI. Sanos was February. We continue to invest. Now we have Emma and Paloa, and you will have some more in the pipeline, and hopefully we can share with you over the following month. Let's take a look at Emma first. So Emma is a company that was founded by Surojit and Suvik a few years ago in San Francisco. I can tell you when I met first Sir Richard in Silicon Valley, I was amazed. I cannot say differently. I feel very privileged to work with him together. He really built an absolutely amazing horizontal agentic AI platform. You have to see this, that he's building libraries and know-how to drive universal AI employees that can automate enterprise workflows in an agentic manner. I mean, Surajit has worked very successfully as Coinbase at Google. I think he has more than 40 patents on his own, U.S. patents for this. So it's an absolute pleasure to work with him. We're super excited to drive these partnerships where we are an exclusive go-to-market partner and integrator for more than 400 clients globally for EMMA. We also have the right to invest in EMMA in the next financing round, and we want to collaborate very closely with them to really orchestrate our know-how on processes in humans for back offices with this digital transformation agentic AI approach. I think it's an area for us that's really strategically important. Back office, where we have grown – I shared this in November and February – double digit last year, and we want to drive this transformational change on back office EPO with Emma together. So more to share at our Capital Markets Day in two months, but I'm very, very happy to have the whole Emma team part of our extended family on board, and we'll be excited what we can do together. Let's move on. So that's Emma. Paloa is a different story. It's also an agentic AI company, a little bit older. It's also now more than 300 people. It was founded by Malte and Stefan in Berlin. They further expanded, so it's a very strong European footprint. And they focused on agentic AI solution for the customer services part, so for the front office part. We really see, of course, given TP's positioning in the worldwide market, a lot of opportunities also, again, blending agentic AI solution and our BPO front office expertise together, packages, and go jointly to market with them. We also have the right to invest in their next financing round. And I do believe this will be a quite winning combination, giving our scale and footprint and distribution now how to implement it in coupling with our core services and their agentic tools and capabilities. So that's, I think, both great examples in addition to the family. And I'm very, very happy to share with you as we move forward more success stories, hopefully, on this partnership that makes me quite excited. So this highlights strategy. Now let's take a closer look at our financial numbers. Olivier, over to you.

Thank you, Tamara. Good evening, everyone. I'm happy to share the good figure with you. I'm just going to start with the first slide just to show that growth is on track. I just wanted to stay a minute on this slide. The growth reported is 2.8%, as you can see. The life-long growth is 1.6%. I just wanted to highlight the fact that In this first quarter, we benefited from a dollar which was stronger than it is today, which is 105 versus 109 last year. And it's clearly not exactly at this level today because we are at 1.13 to make it simple. But I just wanted to highlight that the figure in Q1 benefited from a higher dollar than what we are going to have all along the year probably. And this 1.6% likely growth is, of course, higher than the consensus, which was 1.1. Let's move to the next slide to see what happened precisely in the growth. As mentioned earlier on, the currency effect is negative by 6 million. In fact, it's a mix of a positive one coming from the U.S. dollar, roughly 25 million, that is offset by the Egyptian lira, Brazilian real, and Colombian pesos and others. But just to show that finally, on the first quarter, there is a limited impact, but it will be probably different in the second part of the year. Being on that, we have a change in scope of consolidation of 36 million, which is, as you mentioned by Thomas a minute ago, is a consolidation of ZP activity over two months, which have been consolidated early February. And you have this growth, like-for-like growth of 42 million, which is mostly coming from the core service. I'm going to give you much more detail in a minute. That's where we are. Next slide, please. Here is the revenue by activity split across core service and specialized service. As mentioned, you have a core service that is growth of core service, which is 2.3%, significantly ahead of the forecast, mostly driven by, mentioned by Thomas of Intego, by Europe, Middle East, specifically Africa, and Asia-Pacific. The specialized service – oh, no, please stay on the previous slide. Please, thank you. The specialized service is growing by 10.7%, including the two months of ZP that I mentioned, which is 2.4% if you avoid – if you take out this impact, knowing that beyond that, if you take out the famous non-renewable of the contract in UK, the growth would have been close to 4%. Next slide, please. I just wanted to come back to the performance by vertical, and what you can see is that there is a significant growth in government, travel, hospitality, and media, entertainment, and gaming. It has been also effectively happening in the multilingual hub, including Egypt, but also in Asia Pacific. And as you can see, the diversified client portfolio help us to swallow any bump that we might have. Next slide, please. Performance by business line. This is very interesting to see that care is still 54% of the business and growing in line with overall growth. But what we are seeing is that The growth is also happening significantly in BPO, other non-voice services across the region, whether it's trust and safety, whether it's back-office BPO, or in other stuff. So, obviously, the part that is not care is growing faster than care that is online. That's what I just wanted to let you know. So overall, good performance. And if we move to the outlook, please, next slide. We continue to see a volatile economic environment. I'm not there to comment that on what you read on the paper every day. But we have a positive market dynamic supported by ongoing offshore and automation trends that we are benefiting from. We also benefit from the continued founder consolidation, And we continue to deliver to an ounce of accelerated growth between 2 and 4 like-for-like growth and 3 and 5 if you exclude this famous contract in UK. Margin will grow by 0 to 10 basis points all along the year. And we will continue to generate a strong free cash flow around 1 billion before non-recurring item and continue to decrease our ratio on net debt to recurring EBITDA. That is the figure, and I'm leaving the speech hand over to Thomas to much more in detail. Just for the follow-up.

Look, as we shared and discussed with many of our investors and with you in the call, there have been sort of the requests to better understand what is our strategy in the age of AI. What are we doing to implement AI in our business process services, in our specialized services? What are our unique offerings on the AI side? And what role do we want to play in this AI ecosystem? And secondly, what is sort of a midterm outlook in this world of change? and AI for TP in the next years ahead. And for that, as indicated before, we will reserve and we organize this Capital Markets Day on June 18th in New York. The idea is really to guide you through these questions that you have been asking in more detail, to share with you use cases, what we have done, how we implement our strategy, what we're seeing. As you see, we gave a little teaser at the end of February. We have executed Partnership Center, but there's many more to share with you. And we're really excited and looking forward to welcome many of you either physically in New York, it will be in the Rockefeller Center, or either online via live stream. So very much excited to see you all there. And there we can share a little bit more detail and have a dialogue on these topics. With that, we are open for Q&A and looking forward to all your questions.

Thank you very much, sir. Ladies and gentlemen, once again, as a reminder, if you have any questions, please press star 1 on your cell phone keypad. Just make sure that your lines are not muted to allow you to reach your equipment. Our very first question today will be from Will Kirkness of Bernstein. Please go ahead. Your line is open.

Evening. Thanks for taking the questions. I've got two, please. Firstly, can you just talk a little bit about the language line slowdown? I think you might see something similar maybe back in 2017. So if you could just give any more context on it and maybe any visibility on a rebound that would be useful. And then secondly, just on the investments in the AI, so I think Sanas was maybe 13, and then Emma and Paolo are a combined 25 million. I just wondered how we can think about how that sort of flows out, what ownership you take, whether there's scope to move beyond those initial numbers. And then when we think about that 100 million in aggregate, can that grow significantly? And then what are the implications, I suppose, for traditional M&A and or shareholder returns? Thanks.

So let me start with the first one. I think you hinted to it. We saw a similar dynamic under the first Trump administration. There is a lot of. uncertainty, I would say, in the market. It's less driven by regulatory change. So the language access regulation in the U.S. is in place. But we see in particular for the Spanish-speaking community that is obviously a relevant user group for our language line services in the U.S., some, how can I say this, hesitation to have access to public services, whether this is on the healthcare side or governmental side. And this is a significant portion that we see on this slower development within language line solution. It's still growing, obviously, but let's say some hesitation in demand. It's, of course, very hard to predict how the environment changes there in the next month. We saw a rebound in 2017, and the team expects something similar for this year. So that's why we are more optimistic for the second half of the year. But we have to remain very vigilant and, of course, to monitor this very closely where they're in dialogue with the team. quite closely because obviously as you said rightly it has been a slowdown in the growth compared to last year but growing and managed really by i would say one of the best industry teams there is when it comes to interpreting solutions second question was on ai partnership so As we said, we started with this partnership, and I can tell you the feedback and response we have seen from partners around the world and from AI companies is very, very encouraging. It's very positive. We work with many partners because we believe we want to put the best technology solution in place for our clients so we are not bound to anyone. But we really see the value of collaborating closely with targeted companies where we really can create win-win situations. There are, you've seen we have entered into augmenting our humans with accent translation. We now have two partnerships on the agentic side, one on the front office customer experience services side, the other one a bit more on the back office side, horizontal AI. We also see in discussing vertical AI applications, because AI needs to be often specific, addressed to a certain vertical need. So think about that we are exploring the opportunities on that side. But we want to always build the best-in-class solution for our clients, combining AI and, let's say, the human-led BPO. We're working on this plan. I would say for this year, we have earmarked the 100 million. It's too early to tell how this will develop in the years after, but we're working on making progress and, of course, have to deliver also on the promises we see. As you see in charts, the next financing rounds for both companies have not been completed. I think it's a very positive sign that we are allowed on their cap table, because as you can imagine, this is often highly contested. But as we move forward and as they will do their financing rounds, then obviously if they share it, you will know the valuations. But it's less so about the actual equity stake, but more the arrangement that we have to really allow us to orchestrate their solutions with our capabilities, with our go-to-market or managed service capabilities to really bring it to life. Because I do believe TP is one of the best partners to scale AI solutions in the market. And I think this scaling the AI solution, bringing them to life on an enterprise level is a huge value proposition that we have. Sorry for the long answer. Okay.

Yeah, no, that's very helpful. Thanks. And just to follow up then, so in terms of more around capital allocation, is that a case of wait for the 18th of June capital markets day?

Yes. I think for this year, as you've seen, we have done the acquisition of ZP. uh we of course increased our dividend for this year and we have earmarked as you remember for over a billion free cash flow up to 100 million this year but going forward on the capital application we'll share we're working on it for the capital market say for sure okay thanks very much thank you sir we'll now go to carl green of rbc capital markets please go ahead

Yes, thank you very much. Just two questions from me. Following up from Will's question just on the trends in LLS, you're clear that you're expecting a second-half pickup. If a second-half pickup doesn't materialise, what would the potential impact be on your 0-10 basis points guidance for the group overall? Just trying to get a sense as to how important the LLS recovery is going to be in terms of hitting that guidance. That's my first question. And then the second question, just on the core and dibs, that was a good performance in the first quarter, as you've identified. Could you just give us some flavor as to how that's broken down between new logo wins, new account wins, versus that kind of ongoing deflation and offshoring impact, which you've sort of wrapped together? That would be very helpful. Thank you.

Olivier, you go ahead. Yeah, I'm going to take the first question. Of course, we are following that very closely. Precisely because of the mix. So what we are going to do, and we have already started to do, is just to be on the safe side on the cost, whether it's direct or SG&A overheads. So we are following that precisely to be able to deliver the growth, the margin that we have announced. As far as we know, we are seeing some growth. better momentum in terms of contract sales in LLS. It's not totally finished, but we do believe that there are reasonable chances that we will continue to grow at a higher speed in H2. But that's, of course, during this uncertainty period, we are taking all the measures to control the cost and to make sure that we are able to deliver the guidance that we announced to the market. Second question for you. Can you hear me?

Yes, I hope you can hear me.

Thomas, you take the second question.

Sure. So when you look where we see growth, it's in particular, as indicated before, is media, government, fast-moving consumer goods as well, and travel and hospitality. And as you know, our business is always about ramping up over time. So it's a mix of logos that we have won this year and also the growth with existing clients. As you remember, we have shared last year that we have continued and expanded our investment in our business development activities. And I think it's a good, healthy mix of new logos, one, and existing clients that we have sort of business developed further in the expansion. So it's a healthy mix really across the logos. And if I look the ramp down for the year, as I said, I'm quite optimistic also for the second half.

That's great. Thank you.

Thank you very much, sir. when I move to Ben Wild of Deutsche Bank. Please go ahead, sir. Hi. Thanks, everyone.

I'm conscious that it's a revenue update call today, but I have a few questions on the margin guide that you've reiterated today. Olivier, firstly, in terms of the cost flexibility that you've just described, If I go back to July last year, I think you said on one of these calls that you believed that the group could deliver significantly more than the initial 150 million euros of Majorelle synergy benefits. Since then, you've retained that 150 million target. Where do we stand with respect to Majorelle synergies? And do you now think that 150 million is the absolute ceiling for Second question is on FX and the impact on the profitability of the group. There's obviously been some fairly strong FX news in the last few weeks. Just a question on how you think about the impact of a weaker dollar on the margin. And then certainly with LLS, I think at the beginning of March, there was an executive order, the kind of English-only executive order, What gives you confidence that there will be an H2 recovery in LLS? And how are your clients responding to the regulatory change that has come through in March?

Thank you. Okay, about Synergy, you remember that we delivered 94 million of Synergy last year. We said to the market that we will deliver between 20 or 30 more million this year, mostly geared on the second part of the year for a major reason, because this is something that is coming from mostly the IT and telephony costs that were linked to contracts that are going to finish by the end of June 2025. So we will be able to deliver this savings, not on a full year basis, but closely six months in 2025. So that is absolutely clear. So 150, I'll come back later on in H1 at the end of Q2 with a precise figure, but at that time it will be clearer. But what I can tell you is that most of the synergy has been launched, and, of course, we harvest them on a timely basis given the time. Even the contracts that have been done, especially on IT, but also on site, on certain sites that are, I would say, following some contracts that are absolutely, you cannot get out before the timing. That's the first point. On ethics, there are two issues. One is a transaction. One is a translation. Clearly, here we are speaking mostly of the translation impact. It's not exactly the same story to book a dollar at $1.05 in Q1 and $1.13 as it's done today in our figures, that's for sure. In terms of business, we made our budget at a level which is not very far from the 113. But clearly, we will have an impact on ourselves and on our translation impact of the FX, clearly. So we are following that very precisely. So far, we have not been so much hit in quarter one, in Q1, as you understood. That's why I wanted to highlight it in the second part of the year, in the next quarter to come. So this will be probably, if it continues, this will have a negative translation impact. No doubt, either on sales and either on margin. Difficult to tell where we are going to land. Frankly, if you know that, I would be happy to share it. On the transaction part, most of our covered edge have been down either in September, October, November until early January. So the transaction impact should be not dramatic. Of course, there are ups and downs, but the main impact would be translation. On the fact that The H2 of LLS will be better. Of course, by nature, we don't know where is the H2. So we have a budget. We have a pattern that we followed in 2017 that is clearly showing a recovery after the executive order. Just wanted to be clear on the executive order. The executive order is not a ban of LLS. other language and English at all. There are plenty of other rules that supersede that. So this is not a ban. It's much more a global mood that doesn't help. But legally and people are still bound by their local stuff. So what we see that new volume coming, video is doing well. We see some, as I mentioned earlier on, some contracts are about to be signed by LLS. So we are, of course, monitoring the situation very closely. But this is something that we do believe that we can manage as of today. But of course, we will update the market as soon as we have more information about it or more visibility.

Yeah, maybe to add, because sometimes there's a misunderstanding. today, more than 30 states already have laws in place that designate English as their official language. So it's not that this is something completely new. What the executive order does, as Olivier said, it rescinds an order that was signed by Bill Clinton some time ago for language assistance to individuals with limited English. And yes, federal agencies how to apply the respective laws. But language service agencies can remain their policies. In some cases, of course, necessary if you're in a hospital and you want to do this. And what we see is more a demand-driven, less regulatory-driven change that people simply don't show up. And if you read the news, I think you can understand why. It remains one of the focus areas for the group. Of course, language line is only a part of specialized services, which is a part 50% of the overall business. So we also have to put it into perspective. But obviously, as we said in February, as I said in every investor meeting, we remain super vigilant on this topic because this needs to be managed. And it's a bit outside of our control as this is a demand curve we have to observe in the market.

And sorry, I forgot to mention on your first question, you remember that we mentioned a French reorganization plan that we provided for last year that is underway. And we do believe that... We had good progress there, and we do believe that beyond the agreement of the local representative, we will get a final approval, hopefully, in the coming weeks from the French state. And we believe that we could be able to deliver this plan starting early second part of the year. We don't know exactly yet today, but that should also help to deliver on margin.

Just a final follow-up, if you don't mind. Are you willing to give an idea of roughly what level LLS growth is in Q1, please?

Well, mid-single digit.

Very clear. Thank you.

Thank you very much, sir. We'll now move to Evelyn Gideonu of Morgan Stanley. Please go ahead.

Good afternoon, gentlemen. Thanks for taking my questions. I've got two remaining. So the first one is if there is any update on the ongoing transition for the CEO position, anything you would like to share with us. The second thing is on LLS. It seems to me that The ICE agency in the U.S. is developing some own AI tool for live translation, so wondering if you're doing any work for that government agency and whether you expect any impact from that kind of internally developed tool by U.S. government agencies on LLS. Thanks.

So on your two questions, first of all, thank you for them. The transition, as we said, it really works, I cannot stress this enough, very, very harmoniously with Daniel, the new chairman, Olivier. It's a pleasure to work with them. We haven't said any time. There are so many things to be done, so it's not a lack of work, and it works very collaboratively, and I think also very effectively for the organization right now. With regard to the AI tool from the ICE agency, I have to confess, I haven't heard about it. So we are not involved in developing it, but it's not something that has sort of come up in our discussions. We're happy to go and come back to you on this one to share further details. But we're working with multiple – obviously, we're working with multiple institutions, I mean, also government institutions on various fronts. And, of course, we're experimenting and working and piloting also with AI tools for these interpretation services. So happy to come back to you on this one with a more detailed answer.

Yeah, and just to follow up on that, within the 14%, I think you are doing with government within LLS. Does IC represent a large part of that, or is it highly diversified, that 14%?

Not that, as I know, I'm going to check, but for me, it's very mostly, mostly.

Because also the structure. Yes. Because obviously also the structure of ICPS is quite moving, but we'll come back to you on that one. Yeah, understood. Thanks very much.

Thank you. For questions. Our next question is coming from Nicole Mannion of UBS. Please go ahead.

Good afternoon. Thanks for taking my question. Just one left. Just on the AI piece. Any problem? Hey, hey. Just on the AI piece, I think you mentioned that... We can't hear you.

I can't hear you. Yes, I can hear you. Can you hear me okay? Go ahead, go ahead.

Okay, yeah.

It's okay for me.

Okay, okay, I'll carry on. Yeah, just on the AI piece, I think you mentioned 80 projects launched in Q1, which sounds like your own initiatives, and then obviously you have these partnerships running adjacent. I mean, I guess this will be a big topic for the upcoming CMD, but does this sort of signal kind of a shift to sort of more of a partnerships approach rather than making your own investments in AI technology and so on, or do you still intend to kind of have a hybrid approach there. Just trying to think about how we should think about the balance of those investments between kind of your own restructuring, minority investments and so on. Any call there would be great. Thank you.

Yes, the question of Mike and Bill, it's not either or, it's both. To be honest, we have such a great suite of AI application solutions internally at TP. Some of it's developed, some of it's sort of used market technology and customized. We have this under the umbrella of TP microservices from AgentAssist. simultaneous translation tools, knowledge tools, quality assurance, analytics support. So it's really a great suite of tools. It's not one mega tool, which we also don't set, but really targeted to the specific needs. And we continue to deploy this. So that's the homework we have to do. I think there's still ample of space driving more transformation in our operations. And that's the tools that we use. But if you see really some of the cutting edge technologies, and that's, I must say, we're really privileged to work with both companies or with all three companies now further that's something that we don't have to that extent in-house in certain use cases and there i think providing an open ecosystem and working them with them closely makes complete sense i think they're really if you look at it we will share more details having their partner approach is something that augments our capabilities i think we have a lot of things that we can provide when it comes to the as i said scaling side integrating the human element to it, and that gives us, I do believe, a competitive edge going to our clients and offering the full breadth of our own services as well as our partner services with our partners and even other companies.

Got it. That's very helpful. Thank you.

Thank you. What's your questions, Ben? Ladies and gentlemen, due to time constraints, we have only time for one question, and today's last question will be coming from Mr. Laurent Gelbar of BNP Exam. Please go ahead.

Yes, good evening. Actually, I will have two questions. So the first one relates to the large volatility we have been seeing in the market. Last time we saw that was in the U.S. with the failure of regional banks, and this led some of your clients to postpone outsourcing decisions. So how do you see the pipeline of new business developing and do you see some clients being hesitating going forward on what they are going to do? That's one. And the second one relates to Forex. Olivier, can you share with us a kind of sensitivity of the transaction Forex, i.e. for one cent of euro appreciation versus the dollar, what would be the impact in terms of bips for the overall margin, if you can?

You start, Thomas, or?

Yeah, please do start and then answer the customer, sure.

No, I'm going just to depend, but roughly depending on the level, but beyond our market, beyond our budget, one cent might have an impact of 20 million in sales. That is the impact.

In terms of profitability?

I have to check again. I'll let you know later. But significantly less, as you can imagine. No, but it's true. It's true. Difficult to predict where we are going to land and prefer to be on the safe side. But in terms of sales, yeah, it's 20 million, 20 million cents versus our budget, which is not so far from the actual present rate as we speak. We have been hopefully careful in doing our budget. But the year is not over, far from it.

To your first question, Laurent, so there I do believe it's really the strength of TP comes into play. If you look at our broad client portfolio, you see all kinds of behavior. Some clients, as you said, Maybe wait and see. They are a little bit unsure what will develop and they maybe postpone a certain decision. Other clients want to know, given the macro environment, do we have more cost saving and accelerated? We really see across the board some are affected negatively by the tariff. and certain REM subs are delayed. Some other see more opportunity to drive more offshoring. It's across the board, and I think that's the strength or the resiliency of TP, having this broad geographical exposure and this broad client exposure across different verticals. If you look at the growth of the different segments, it's different than what we've seen last year. And I think that's the ability sort of to mitigate that risk, is something that we feel quite strongly in a world that gets more and more volatile almost by the week, that we are a little bit of a of a haven of stability. Yes, we see also volatility. Yes, language line, as I said, had some challenges still growing. But on the other hand, the core business that makes us quite excited is growing faster. So last year, as you remember, it was almost the opposite in the beginning of the year. I wasn't there, but in Q1, they said, oh, the core business was not growing, but specialized services growing. The strength of TP is to have this broad mix across geos, across verticals, and across different lines of business. that gives this overall stability. And there, yes, I'm not happy, I can tell you, with the development of a language line. On the other hand, I'm super excited to see how we're growing in certain verticals. And yes, there are some clients to have a wait and see and where we are in ongoing discussion to do this. So yes, we have to manage this volatility, but from a position of relative strength in an ocean of volatility.

Thank you, Thomas.

And we are seeing the core service growing again at a better speed, probably higher than people expected. And this is something that should be noted.

But I'm happy. I think it's the last. But we're happy to share again. As we move along, we have now end of April. The first quarter is over. We will be in five weeks or six weeks from now on the capital markets there. Of course, we will then present an update where we stand and really looking forward to continue the dialogue with all of you.