Q2 2025 Amdocs Ltd Earnings Call
Speaker Change: Thank you for standing by and welcome to the Amdocs' second quarter 2025 earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you'll need to press star 11 on your telephone. If your question has been answered, and you'd like to remove yourself from the queue, simply press star 11 again.
Speaker Change: As reminded, today's program is being recorded. And now I'd like to introduce your host for today's program, Meta Smith, Head of Investor Relations. Please go ahead, sir.
Speaker Change: Thank you. Before we begin, I need to call your attention to our disclaimer statements on slide two of the presentation in those that some of our comments today may be forward looking statements and our subject to risks and uncertainties, including our described in Amdocs' SEC filings, and that we will discuss certain financial information that is not prepared in accordance with gap.
Speaker Change: For more information regarding our use of non-GAAP financial measures, including the reconciliations of these measures, we refer you to today's earnings release which will also be furnished with the SEC on 4-6-Tay.
Um.
Speaker Change: Today's speakers, participating on the call with me today are Shuki Sheffer, President and Chief Executive Officer of Amdocs Management Ltd. and Tamar Rapaport DeGim, Chief Financial and Operating Officer.
Speaker Change: To support today's earnings call, we are providing a presentation which can be found on the Investor Relations section of our website and as always a copy of today's prepared remarks will also be posted immediately following the conclusion of this call.
Speaker Change: On today's agenda, Shuki will recap our business and financial achievements for the second quarter and will update you on the continued progress that we've made executing against our strategic growth framework, including Genai and our continued sales momentum in cloud.
Speaker Change: Shuki will finish by discussing our financial outlook for the fourth fiscal year 2025, after which Tamar will provide additional details on our second quarter financial performance and forward guidance.
Speaker Change: As we communicated previously, Shlomo Shlomo should also welcome certain financial metrics on a pro-former basis.
Tamar Rapaport-Degim: which had just prior fiscal year 2024 revenue by approximately $600 million to reflect the end of certain low margin non-core business activities which were substantially already ceased in the first quarter of fiscal 2025. And with that, I'll turn it over to Shuki.
Shuki Sheffer: Thank you, Matt, and everyone joining us on the call today.
Starting on slide six.
Shuki Sheffer: I am pleased to report good results for fiscal second quarter, ready for which belongs to Amdocs.
Shuki Sheffer: Global Base of Employees were executing our strategy to deliver the next-gen cloud, digital and AI-based solutions our customer needs to ensure amazing experiences and seamless connectivity for billions of people each day. Among the second quarter of financial highlights.
Shuki Sheffer: Revenue of 1.13 billion was above the midpoint of our guidance and increased by 4% from a year ago in Performer Council Council.
Shuki Sheffer: for stability improved by 10 basis points equationally at the flexing ongoing internal efficiency gains.
Shuki Sheffer: non-GAAP earning per share was $1.78, above the guidance range, primarily due to lower than expected non-GAAP effective tax rates in the quarter.
Shuki Sheffer: Additionally, we close the second quarter with a 12-month backlog of $4.17 billion up by 3.5%
Shuki Sheffer: The healthy increase in 12 months backlog was supported by a strong pipeline to deal conversion at Sorn and Slide 7. Among the highlights...
Shuki Sheffer: We slightly are relationship with 18 T-cricket wireless through payment solution, deal
Shuki Sheffer: Consumer Cellular, a new logo for Amdocs in the U.S. has selected our Connected Access Solution to introduce new digital brands, and we benefit from a healthy customer's demand for our fibre deployment or costation and digital infrastructure management service offering.
Concert Momentum in Cloud also continue this quarter
Shuki Sheffer: We are working with Microsoft to migrate Amdocs and non-Amdocs application to the Microsoft Azure platform for a leading T1 European operator.
Shuki Sheffer: And in Philippines, we sign an agreement to support the next phase of PILDT's Cloud Modernization Projects
Shuki Sheffer: As to our Project Execution Disquater, we successfully achieve a high number of major milestone for many of our world's loudest operation.
Shuki Sheffer: At AT&T, we are progressing the main sum to cloud migration using the Amdocs Argentine migration paradigm, which entails migration application and operational ecosystem to operate on the cloud.
Shuki Sheffer: We also reach notable mice in Japan, a strategic market for Amdocs, where we deliver an advanced cloud-native platform to enable NT and T-Infernet to modernize and migrate its IT operations system to the cloud.
Shuki Sheffer: This achievement continues our momentum in Japan, where we are now supporting three flagship customers including Jacob and Tharamount in addition to entity infinite.
Shuki Sheffer: Rounding out the Operation Highlights, we deliver another record quarter-in-minute services, which could to be roughly two thirds of total revenue.
Shuki Sheffer: Renewal Wright also remained very high in Q2, as we sign new multi-year managed services agreements that expand end-of-scope of activities with tell-you-no-way, PDT and M1 in Singapore.
Shuki Sheffer: Moving now to Slide 8, let me address our multi-pillar growth strategy, which is designed to provide our customer with the innovation and cutting-edge technology they need to
Accelerate the journey to the Cloud.
Shuki Sheffer: Did it have the customer experience for consumer and B2B? Monitor investment in net generation networks? Stringline automated complex network ecosystem and simplify and accelerate the adoption of GenNTVI
Shuki Sheffer: Beginning with cloud on 29, Qt over another strong quota of sales momentum and best-in-cloud project execution.
Shuki Sheffer: Working with a strategic partner Microsoft, I'm excited to announce that Amdocs were selected to play a critical role in facilitating the migration of both Amdocs and on Amdocs' application to the Microsoft Azure platform for a tier one European service provider.
Shuki Sheffer: Under the Microsoft Amrela, Amdocs is heading the delivery of number of work stream pivotal to the operator's strategic transition to the cloud-first architecture which will enhance performance, exert innovation and improve operational efficiency across its markets.
Speaker Change: Andocs always successfully complete the fails phase of its cloud modernization project for a leading Philippine services provider, PILDT, and its wireless observatory smart, migrating PILDT business-critical system and legacy application to AWS.
Shuki Sheffer: We also signed a new agreement to upgrade PTT's data platform, an additional call system in the next phase.
Shuki Sheffer: Additionally, Telstra in Australia has engaged Amdocs to consult its segment-specific Amdocs service order management solution to a single-cloud platform servicing all segments which will provide the operator with a faster time-to-market.
for New Services, Greater Business Agility, and Epoof Customers of Disfection.
Speaker Change: I believe the ability to win deals and execute projects in the cloud is a testament to our expertise and end-to-end cloud offering. Moreover, we remain on track to deliver another year of double dits course in cloud-related revenue in fiscal 2025.
Moving to the digital transformation on slide 10
Speaker Change: I'm delighted to announce that Consumer Cellular, a US wireless provider, has become the latest in the growing list of customers to select the Amdocs Connect X cloud-native SaaS platform to support the loans of innovation new digital brands, innovative new digital brands.
Speaker Change: It's a new client of Amdocs. We look forward to partnering with Consumer Cellar Allow to help and rapidly create and deploy new plans, achieve operational excellence, and boost customers of satisfaction for the roughly 4 million subscribers.
Speaker Change: Amdocs Market 1, a SaaS-based and scalable platform that enable service provider to rapidly monetize OTT and digital consumer service experiences is also generating healthy customer demand.
Speaker Change: Marketsman was recently selected by St.K. Hutchinson to equip participating group companies such as three higher-led and wind tray in Italy with the ability to grow the digital ecosystem, capture new revenue streams and deliver enhanced customer experiences.
Speaker Change: Another of our SaaS platform, Amdocs Easing Clouds, was recently ranked number one in the global Easing orchestration landscape for the third year running by account of point research.
Speaker Change: The Accelerate adoption of Easing Globally is creating opportunities for Amdocs. For instance, Amdocs is working with stem cell the largest mobile operator in Mexico in the subsidiary of Camovel to bring innovative Easing technology to millions of Tel Seriosos.
Speaker Change: Turning to slide 11, Amdocs continue to be recognized as the global market leader in overall
Speaker Change: He looks starting out Domain Strains Comcas as renewed its multi-ill commitment to Amdocs' Bill experience as the Bill presented platform for its residential and business customers.
Speaker Change: And we recently modernize anyone Bulgarians, convert charging platform to reduce billing processing times and speed up customer-facing interaction.
Speaker Change: In Latin America, we started an agreement with Movistar El Salvador for full BSS modernization to enhance its current pre-paid platform, and Amdocs was recently selected by Botswana Telecommunication to modernize its convert charging and billing platform.
Moving to Network Automation of Slide 12
Speaker Change: It's an extended network policy platform agreement at Cloud Brazil for multiple consumer line of business. And we have secured multi-year extension of our OSS engagement with Costa Rica, Guapo Ese, reinforcing our long-standing collaboration and commitment.
Speaker Change: I also would like to highlight recent mice on its PVT in Philippines when we partner with Microsoft to deliver the successful Google Live of the Amdocs Custom Engagement Plastics.
Speaker Change: This enterprise B2B platform was seamlessly integrated with Amdocs' intelligent network suite to connect customer servants needs directly to do underlying network performance in an automated end-to-end
Speaker Change: Beyond wireless, Amdocs is well positioned to meet strong demand for fibre deployment of frustration and leader infrastructure management its global service provider accelerated the fibre expansion investment to launch converged broadband and mobile services offering.
Turning to slide 13 and 14.
Speaker Change: Amdocs Ltd's priority is to access the telco-industrial adoption of Gen.A.I.
Speaker Change: Architech and Lord was recently recognized at Nvidia's GTC event during CEO Jensen Heng's keynote address, where Amdocs was spotlighted as the key partner in driving the next wave of AI innovation in telecom.
Dr. Prasad Prasad Prasad Prasad Prasad Prasad
Speaker Change: This hotel we continue to evolve the Amdocs image platform in close cooperation with Nvidia and other GNI partners.
Speaker Change: It's part of the new link to this and made splats on offerings. We launch our innovating network agents supporting both network design and deployment as well as network operation.
Speaker Change: Kappel with NVIDIA's AI Enterprise, NVIDIA Omniverse, Digital Twin capabilities in Amazon, SageMaker, Maker to support accelerated network design, planning and deployment network troubleshooting
Additionally,
Speaker Change: We launched Amdocs Ltd in a factory which is designed to help service providers monetize surging enterprise customer demand for air-driven infrastructure such as GPUs of service, LLNs and vertical intelligence application, enabling them to unlock significant new revenue streams.
Speaker Change: The offering Mary's Amdocs and May's platform, Agentex, Agentex, Experiences and Monetization Suite with an idea and delinial structure to provide the full ecosystem of capabilities needed to create innovative new services.
Speaker Change: As to our commercial progress, we are running multiple POCs in several of our flagship customer many of which are in the relatively mature stage and producing highly compelling results.
Speaker Change: Adding to the expanding pipeline of opportunity, Amdocs is a natural well-position to meet the new wave of demand for data, the data-related services, meaning to support GNII adoption.
Speaker Change: Amdocs are already playing an expensive loan in support in GNI-related data requirements for several customers such as AT&T and Globally the Philippines.
Speaker Change: It's another example, Amdocs Ltd support a T1 operator in Canada, which launched a unified customer profile as part of the data and ice strategy, creating a single integrated view of each customer across worldwide operations.
Now, to address the current operating environment on slide 15
Speaker Change: The level of global macroeconomic uncertainty is clearly rising in the recent months.
Speaker Change: But we believe Amdocs is relatively well positioned to navigate the present environment due to our unique business model. As a specialist software and service provider to the global communication and media industry, Amdocs is currently directly affected by the announced stories.
Speaker Change: A course of serviceable market of nearly 60 billion, we continue to see rich and encouraging Python, which we are working hard to convert to new deals.
Speaker Change: by leveraging our technology leadership, project operation and expertise, and our poor inability to support customer industry conservation initiatives.
Speaker Change: Having said that, no company is completely immune to operating environment and we have of course closely monitoring any indirect impact of macro conditions on us in our customer spending
Bringing you all together.
Speaker Change: Continuing our stone-frails half-performance and our current level of visibility,
Speaker Change: 25 Performa Revenue Gross Outlook of 2.7% in constant currency, all be each within a tight
Speaker Change: We are also on track to achieve our target of double-digit expected total journal return for the fifth consecutive year, supported by significantly improved profitability and robust early-to-cash conversion. With that, let me turn the call over to Tamar for remarks.
Tamar Rapaport-Degim: Thank you Shlomo and a lot of you. Thank you for joining us.
Tamar Rapaport-Degim: Before I begin in today's comments, I will compare certain financial metrics on a follow-up basis, which are just prior fiscal year 2020 for revenue.
Tamar Rapaport-Degim: by approximately $600 million to reflect the phase out of certain low margin.
Tamar Rapaport-Degim: Nanko Business Activities, which were substantially already seized in the first quarter of fiscal 2025. To further assist your modeling, the regional mix of this revenue was similar to the overall company, and it contributed roughly 150 million per quarter.
Shuki Sheffer: Now picking up on Shuky's earlier comments, we deliver the good set of results for the second peaceful quarter as detailed on slide 18.
Shuki Sheffer: Q2 revenue of approximately 1.13 billion was up 4% year of year in Performa Concentre currency and was above the midpoint of our guidance. This might negative foreign currency movement of approximately 2 million dollars compared to our guidance assumption.
Shuki Sheffer: We are pleased with the stronger pace of growth in Q2, which reflects from by sale the ramp up of previously signed engagement and recent acquisition.
Shuki Sheffer: Reflecting the phase out of certain business activities reported revenue declined by 9.4% from a year ago.
Shuki Sheffer: On a regional basis, North America was slightly up-to-quenchally and up 1.4% from a year ago in to form a constant currency.
Shuki Sheffer: As anticipated, you operate bounded from the weakness of the fire corner, benefiting from the ramp up of new deal activities, and a contribution from the previously completed acquisition of profit.
Shuki Sheffer: In Southeast Asia, healthy customer activity was offset by mixed trends in Latin America, resulting in sequential decline in rest of the world.
Shuki Sheffer: Chifting down the income statement, Naga cooperating margin of 21.3% improved by 10 basis points sequentially, supported by the ongoing adoption of automation, AI, and other sophisticated
Shuki Sheffer: On pairs with a year ago, Dan Gap operating margin jumped by 290 pages points by merely reflecting the end of the low margin business activities and efficiency gains.
Shuki Sheffer: On the bottom line, NNGAP diluted EPS of 1.78 was above our guidance range. This was primarily resolved of a lower NNGAP effective tax rate in the quarter, which included a tax benefit that naturalized alias and plants in the year.
Shuki Sheffer: Similarly, diluted gapy pairs of 1.45 was also above our kindness range, due to a lower than expected effective gap tax rate in the second quarter.
Shuki Sheffer: Turning to Slide 19, revenue for managed services was a record $747 million in the second fiscal quarter, up to 3.7% from a year ago.
Shuki Sheffer: Revenue from all the year, Manage Services Engagement to Counties for 66% of total revenue in Q2 supporting our visibility and underscoring the importance of Manage Services or the key measure of business resiliency for Amdocs.
Shuki Sheffer: Arrizio Rates for Manage Services Engagement have historically approached 100% and typically include an expansion in our scope of activities.
Shuki Sheffer: To provide a few recent examples, we are extending our long-term strategic relationship with Italian Norway through 2030 to deliver enhanced managed services.
Shuki Sheffer: This continuous collaboration will improve telly and always operational efficiency, empowering them to offer more streamlined and effective services to those customers.
Shuki Sheffer: We are also expanding our managed services in PILDT with our current long-term engagement to cover non-Amdocs applications.
Shuki Sheffer: And we recently extended the multi-year managed services agreement with M1 Limited in Singapore to manage this customer's new cloud-native charging platform.
Shuki Sheffer: Cunning to the Bound Sheet and cashflow highlights on slide 20, ESO of 77 days fell 4 days sequentially enrolled by one-day year of year reflecting normal fluctuations in business activity.
Shuki Sheffer: and Bill Decivibos, Net of the Third Revenue, declined by 25 minutes sequential in Q2, aggregating both the short-term and long-term balances.
Shuki Sheffer: As a reminder, the net difference between unbuilt receivables and deferred revenue fluctuates from quarter to quarter in line with normal business activities, as well as our progress on significant multi-year transformation programs we are currently running in North America.
Shuki Sheffer: Reflecting strong execution, free cash flow before we structure impairments was $181 million in Q2.
Shuki Sheffer: including the department of 25 million reported free cash to 156 million.
Shuki Sheffer: As expected, Q2 free cashflow was affected by the payment of our annual bonuses for the prior fiscal year, the timing of which occurred as it normally does in the second fiscal quarter.
Shuki Sheffer: Overall, we added Q2 with a healthy cash balance of approximately $324 million, and bond-boring of roughly $650 million, providing ample liquidity to support our ongoing business needs while retaining the capacity to fund our future strategic goals.
Shuki Sheffer: Turning to capital location on slide 21, this quarter we repurchased $135 million of our own shares and our current authorization of which there was roughly $258 million remaining as of March 31st, 2025.
Shuki Sheffer: Deflecting our confidence in the future success of Amdocs and the company's ability to generate cash, our board has today authorized a new share repairs plan of $1 billion with no state-of-the-exploration date.
Shuki Sheffer: Between the two authorizations, we have up to 1.26 billion of remaining repurchase authority as of now.
Shuki Sheffer: as of March 31st. Additionally, we paid cash dividends of 54 million in the second fiscal quarter. Looking ahead, we are reiterating a free cash flow target of between 710 million to 730 million in fiscal 2025.
which is before structuring things.
Shuki Sheffer: Given the previously mentioned seasonality relating to the timing of second-quarter bonus payments, with the last 40% of fiscal year 2025 free cash load target already achieved in the first fiscal half of the year, we are well on track to deliver our annual free cash load target.
Shuki Sheffer: Our annual free cashflow outlook equates to a conversion rate of more than 90% relative to expected non-gotten income and translates to a healthy free cashflow yield of roughly 27% relative to Amdocs' current market capitalization.
Shuki Sheffer: Regarding our capital allocations in fiscal year 2025, we expect to return the majority of our free cash
Shuki Sheffer: Moving to slide 22, 12 months backlog was 4.17 billion at the end of Q2, up 3.5% performer from a year ago and 30 million sequentially.
Shuki Sheffer: We expect 12 months backlog to represent roughly 90% of forward-looking revenue, further underscoring the importance of this metric as a leading indicator of our business.
Shuki Sheffer: Now, turning to a revenue outlook on slide 23, we are continuing to closely monitor the prevailing level of macroeconomic geopolitical business and operational uncertainty in the current business environment.
Shuki Sheffer: The third quarter in full year 2025 financial guidance deflects what you consider to be the most likely outcome based on the information we have today, but we cannot predict all possible scenarios.
Shuki Sheffer: On a performer constant currency basis, we are reiterating the 2.7% midpoint of our fiscal 2025 revenue growth outlook, which we have tightened to a range of 1.7% to 3.7% year over year, as compared to 1% to 4.5% previously.
Shuki Sheffer: As a reminder, our annual guidance includes another year of double digit growth in cloud and some contributions from inorganic deal activity this year.
Shuki Sheffer: As to the third fiscal quarter, we expect revenue between $1.11 billion to $1.15 billion, which assumes the positive sequential impact of Rafi's fur from foreign currency fluctuations as compared to second quarter of fiscal 25.
Shuki Sheffer: Moving down the income statements, we are on track to produce non-GAAP operating margins within our guidance range of 21.1% to 21.7% in fiscal 2025, the midpoint of which equates to substantial increase of roughly 300 basis points of comparison with a pile of fiscal year.
Shuki Sheffer: Improvement from face-down business activities and another 60 to 70 basis points resulting from our continued focus on operational excellence, automation and gradual implementation
Shuki Sheffer: Below the operating line, foreign currency fluctuations in hedging costs are expected to impact non-GapNet interest and other expense by roughly several million dollars on a quarterly basis.
Shuki Sheffer: As indicated at the beginning of the year, we expect our non-GAAP effective tax rates for fiscal 2025 to be within an annual target range of 15% or 17% for the full fiscal year 2025.
Shuki Sheffer: Bringing everything together on slide 25, we are reiterating your non-GAAP deluded earning per share growth outlook of 6.5% to 10.5% in fiscal 2025.
Shuki Sheffer: Considering our strong first half earnings for Shlomo and the midpoint of our Q3 EPS guidance, we expect that by the end of Q3 we will have achieved roughly three quarters of our full-year total targets for non-GAAP diluted EPS growth.
Shuki Sheffer: Overall, we are on track to deliver double digits expected total shows with turns for a fifth consecutive year in 2025, including a dividend yield of more than 2%.
With that, back to you Shlomo
Shuki Sheffer: Thanks, Tamar. I am pleased with our performance in the first two quarters, and we are entering the second half with a strong backlog position and reach-pipe on the opportunities.
Shuki Sheffer: We are the market leading offering and proven ability to execute. We believe we are well positioned to achieve our targets for the full fiscal year, while we of course, we monitor in the current market environment closely. With that we are happy to take out your questions.
Speaker Change: Certainly, and as a reminder, ladies and gentlemen, if you do have a question at this time, please press star 1-1 on your telephone. Our first question comes from the line of Timothy Horan from Oppenheimer, your question
I've great good things, guys. We focus on AI a minute.
Speaker Change: Are you starting to see material contributions to revenue growth from AI or improvements to the product and...
Speaker Change: You know, how are you kind of working with Endidia on AI at this point, any more color on that collaboration? And then related to that, it sounds like cloud growth is accelerating is...
Speaker Change: Is that true? And you know, is AI helping that growth or is it go to market or other improvements in the product there? Thanks.
In order to reconnect strongly
Speaker Change: Genii activities with data because the only way to get the benefit of Genii is to send the data and this is to some degree what you mention is some overall from the cloud because definitely when you move the data to the new platform.
Speaker Change: Whenever it's Microsoft, AWS, or Adil's definitely it's also in the cloud.
Speaker Change: We see a lot of activity that support GNII in the data domain, which we see some expanded activity in the data domain, which closely contribute to revenue growth.
Speaker Change: In the use cases, I would say we see good signs of POC.
Speaker Change: I'm maturing to real deals, I think it will be more evident in the future quarters but overall we see a good progress regarding Nvidia we are obviously collaborative with Nvidia in many domains [inaudible]
I think what the progress that he has done there is...
Speaker Change: and this quote is beyond what we discussed before how we can support, you know, calls and tales and monetization and upsell.
Speaker Change: I think that the progress we've done was mainly in the network domain, so now we are having, actually, we build our network.
Speaker Change: Automation and Domain Discordial, a building on Nvidia tour. So I think this was the progress regarding Nvidia on top of what we've done with them already before.
Speaker Change: Very helpful, and Tamar, follow-up, great improvement to the margins here. Are you using AI to improve your own productivity much and, you know, is there, can you kind of continue the base of margin improvements going forward for a few years, thanks?
So, Tim, let me take this.
Speaker Change: When we talk about Genai, there are three pillars in Amdocs that I think that we are actively working. One is the offering, building on our image platform, and developing AI factory in different use cases, and data to support the Genai. This is one.
Speaker Change: The other one is all our products today are generally enabled, so when you take our products, they are coming with generally eye capabilities.
Speaker Change: And the third element is more of a how we are going to aim.
Get the efficiencies in our software development website in the operation.
using a Gen-AI tool.
We see a lot of progress, definitely.
Speaker Change: When we look at the, remember we talked before, a lot of automation that we've done historically to support our...
Thank you.
Thank you.
Speaker Change: Thank you. And as a reminder, if you have a question at this time, please press star 1-1 on your telephone. Our next question comes from the line of Shlomo Rosenbaum from Stefold. Your question, please.
Shlomo Rosenbaum: Hi, thank you. Shuki, can you just talk a little bit about the customer spending behavior? What you saw is this quarter versus what you saw last quarter and you know we're into May already. Thank you very much.
Speaker Change: There's obviously more risk and concern out there, but are your clients changing anything, or is it really kind of the same? And then I have another follow-up.
Speaker Change: I would say we don't see any change right now in our customer spending behaviour.
Speaker Change: Okay, great. And then maybe for Tamar, the AR, after several quarters have gone up, has seen a couple quarters of going down, it looks like you're hitting milestones and um builds are going down.
Speaker Change: Should we think about this as something that was kind of bumpy that you needed to go past?
Speaker Change: Or is there something where there's a certain range that you expect to operate within? And these are just kind of the fluctuations within that range. In other words, did you have a lot of projects that were unusual that you had the milestones kind of in front of you when you got past them or is this the normal cadence of bouncing around?
Sizing Wives [inaudible]
Speaker Change: When we are thinking about what's happening specifically in the, and build the ARB failed position and I'm usually looking at the net difference because you know sometimes the customer may be in and built position and then took what is later in the field because eventually it's the gap between how we what's the face of recognition versus invoicing.
Speaker Change: So, I don't think we can say that, oh, now it was a thick level of milestones and we issued invoices and necessarily now the only way is down it's made bounce around I think the good news is
Speaker Change: In any one of these countries, any one of these projects, we are making progress, we are hitting the inverse milestones once we do, we collect the money, so the cycle works.
Speaker Change: And I think that looking forward, you know, as we are going after additional significant deals that are in the pipeline.
Speaker Change: Of course, that will be good news, right? I mean, if we get to win additional deals and then they have the cycle of their own, but that's too early to tell exactly what we'll be the mix of...
Speaker Change: and that's why we don't guide for these balances, it's very hard to predict exactly in every quarter all the moving elements.
Speaker Change: Okay, if you don't mind me squeezing one more and just following up on the one question from previously, there's a lot of POCs on the AI offerings and we've been talking about that for the last few quarters.
Speaker Change: Is there anything large that has hit in terms of contracting yet? Or are we still kind of waiting for the really big, you know, a few big referenceable clients to kind of start to cascading?
I think the same.
Speaker Change: For me, data-related activities to support and I, we do see a good progress, as I said before. I cannot mention, but we have at least a couple of customers that are doing a very good progress also from the commercial side, but they cannot name them yet.
Speaker Change: Are they, um, though, referenceable for other clients and others I understand you want to talk to us about it but if someone else called in are they ones that are far enough that they get someone else could talk to them? Okay. Yeah, very good. Thank you.
Thank you.
Speaker Change: Thank you. And as a reminder, ladies and gentlemen, if you do have a question at this time, please press star 11 on your telephone.
Speaker Change: And this does conclude the question and answer session of today's program. I'd like to hand the program back to Matt Smith for any further remarks.
Speaker Change: Thanks operator and thanks everyone for joining this evening. If you do have any additional questions, please reach out to us here in the IR group and with that have a great night.
Speaker Change: Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.