Q3 2025 Amdocs Ltd Earnings Call

Thank you for standing by and welcome to the m docs, third 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, and you'll need to press star 1, 1 on your telephone. If your question has been answered and you'd like to remove yourself from the queue simply press star 1 1 again, as a reminder, today's program is being recorded. And now I'd like to introduce your host. For today's program, Matt Smith head of investor relations. Please go ahead sir.

Thanks operator. Before we begin, I need to call your attention to our disclaimer statement on slide 2 of the presentation. It knows that some of our comments today may be forward looking statements and our subject to risks and uncertainties including us described in unbox his SEC filings and that we will discuss certain financial information that is not prepared in accordance with gaap. For more information regarding our use of non-gaap financial measures including reconciliations of these measures, we refuse,

You to today's earnings release, which will also be furnished with the SEC on form, 6K.

Participating on the call with me today, I'll shoot you share, president and chief executive officer of Amos management limited and tomorrow Rapaport dig in Chief Financial and operating officer.

Certain financial metrics on a pro forma basis adjust 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 Shiki.

Thank you, Matt and everyone joining us on the call today.

Starting on on slide 6.

And looks delivered solid financial results and achieved important business milestones. In Q3, our global team of amazing people continued to support the strategic business imperatives of our customers with innovative cloud, digital, and AI-based solutions.

Touching on the quarterly financial highlights.

Revenue of 1.114 billion was up 34.5% from a year ago in a perform, a constant currency. Exceeding, the middle part of our Guidance, with sequential growth in all regions, and a record quarter in Europe.

Profitability improved by 10 basis points sequentially delivering my internal efficiency improvements.

Non-game not Gap, diluted earning per. Share was 1.73 a penny above the midpoint of our expectation and we wrap up the quarter with the healthy transfer backlog of 4.15 billion up 3% from a year ago, performer,

Jumping to slide 7.

Q3 features several important wins, which showcase amdocs market and Technology leadership in our proven ability to power the mission, critical needs of our to customers.

We have continued to see positive sales momentum in Cloud where we have recently won Kee modernization immigration deals, which expand our long-standing partnership with Alisa in Finland, Cloud, Brazil, and a leading Eastern, European operator leveraging, our end-to-end Cloud offering and Telco vertical expertise.

In the emerging domain of jennetty, AI, and data services, I'm encouraged to say that our tech leadership and key partner collaboration with Nvidia and Microsoft are bearing fruit. As we start to convert previously discussed PCs into commercial success.

Notably, we recently won strategic died related deal with 3 customers, including a leading US service provider, Consumer Cellular, and he had UAE, and I believe provides. And I believe this will provide a foundation to which we demonstrate MDOC Genai capabilities to further. Expand our customer activities over time.

Telling to project execution.

I'm just engaging complex Mission critical transformation closely working with our customer as a key partner.

During criteria, we deliver new record number of deployments achieving key outcome Milestone at AT&T Comcast voron Italy, and Netherlands. Build it in the Philippines and other

Among the highlights Bell Canada and Abdul is set a new Benchmark by moving. Critical Billing System to the cloud simplifying, thousands of daily operation and interfaces in the in the process.

We also supported the go live of our B2B platform in Optus in Australia and completed a BSS modernization supporting 25 million subscriber in Telecom South Africa.

Rounding out my operational review. Q3 was another record quarter in Monette Services. Moreover, we have recently strained, our managed Services engagements with several key customers including a leading provider service. Provider in the US, BT in the UK and Telstra in Australia.

Telling to slide 8. I like to elaborate of our growth strategy, which is built to address our customer, strategic, business imperative, and investment needed to accelerate the journey to the cloud.

Simplify and accelerate the adoption of generative, Ai and data services.

digitalized customer experience and consumer of consumer and B2B

And monetize Next Generation, Network, Investments, and streamline and automate complex Network ecosystem.

The execution of our growth strategies enabled by amdocs. Unique tackled business model, which integrates Cutting Edge technology, across platform and solution, project deployment, and IP based it operations support.

By continuing to invest in innovation to further extend our tech offerings and capabilities, we are consistently able to bring value to our customers.

We see every engagement as an opportunity to showcase our value position and gradually scale activities within our existing customer as well as new ones.

As we can see on slide 9 more customer choosing amdocs as the primary partner for public private and hybrid Cloud, migration using our comprehensive Cloud solution and Telescope expertise.

We are happy to announce the expansion of our partnership with the Lisa in Finland to modernize their B2B platform using MDOC, CS digital Suite deployed on Google Cloud gcp.

This transformation will enable a Lisa to accelerate time to Market. Streamline, delete to older journey and deliver a unified experience across mobile and fixed Services all on a single converge digital platform.

It marks a significant step for forward. Enhancing agility, improving customer engagement and supporting Eliza long-term growth in the B2B space.

We are pleased. Also pleased to announce a new win with 1 of Eastern, European leading service providers will be leveraging. Our cloud-based customer experience platform, a solution designed to transform customer experience and operational agility.

As part of this engagement and dogs will also work with the service provider to migrate new required, Mobile customer to the platform driving long-term, efficiency, and innovation.

Brazil to modernize their Enterprise systems.

I also want to highlight AMD's unique suite of SaaS-based cloud solutions, which are gaining market traction and contributing to growth.

Our suite includes Connect X, which is helping every nose and Telos to launch strong, powerful brands created to target specific consumer groups with unique user experiences.

Connect X was recently adopted by Consumer Cellular, and several other new logos. In addition to which we've dependent our with deepen, our collaboration with AT&T, by extending our connected platform agreement to accelerate. Its next gen Market offering.

An example of a way in which connectors is supporting our customers mobile phone leading Vietnamese operator, which recently used platform to launch. Say me its new digital brand. Specially tailored to meet evolving needs of young tech-savvy, gen Z subscribers,

Supported by a strong sales momentum of the last several quarters, we expect to reach our double-digit revenue growth target for cloud in fiscal 2025.

Furthermore, we believe Cloud will remain a primary goals engine, for real dogs, in the foreseeable future. As most of our customers are only just starting, just getting started on their multi-year, migration Journeys.

Turning to slide 10.

We are intensifying our focus on genetic Ai and data. Services is a key growth pillar for Amos. Let me take a moment to elaborate

First a leading US service provider has signed an expanded multi agreement, which extend minutes services to transform its billing Commerce catalog and Order management through Genai power solution.

This includes a geni enabled maze, agent Bill presenter to simplify billing inquiries and enhance customer experience.

Second, I'm just explaining multi-year agreement with Consumer Cellular as this wireless provider to transition to an AI powered mvn.

Building on a recent deployment of connect X. This agreement, leverage amdocs Ai and data platform. Customer experience insight and the mates with to transform Telecom data into actionable insight and real-time Predictive Analytics for great for greater automation intelligence.

Third, I need to share as we expanded our collaboration with the uae's largest service, provider en UAE.

Through additional new gehna use cases, this development built on the successful implementation of our Mas platform and marks another step in the journey, towards fully powering, all of e and UA's, customer facing Channels with Genai.

Over on.

I'm encouraged by this recent deal because they reflect my data service and leadership in the Telco industry. And because they provide strategic Foundation, or which we can demonstrate value, and gradually scale, our customer activities in this emerging domain over time.

Moving on Q3 in calls include notable customer development that grows our additional key strategic pillars as shown on slide 11.

Beatty.

Is awarded at dogs. A digital transformation project.

Starting day to be finalized that will enhance their consumer customer experience as part of a multi-year, managed Services engagement.

Solution Coastal services.

In network, we've extended an engagement with Australia Tara and we are continue a multi-year OSS digitization which will enable Telstra to benefit from our Genai and network automation capabilities.

Additionally 18 units. Open at policy managed Services engagement with amdocs under an expanded. Long-term agreement

Cloud Brazil, expanded policy, platform agreement with amdocs to better. Serve the evolving needs of its playpen and prospered, customers and Globe. Telecom in Philippines, selected Amos to deliver end-to-end, run optimization services. This is game cover. The full spectrum of front services including installation, commissioning integration testing, accepting optimization of its radio sites,

Global service provider are also accepting the fiber Network expansion Investments to enable converge value at offering which bundle broadband and mobile together.

The trend is creating strong demand for fiber Network design, the deployment orchestration and digital infrastructure management solution which Andrews is positioned to support with our next gen fiber solution.

For instance, we've significantly increase our fiber Engineering Services to support in support of AT&T's fiber expansion, serving them, as their connectivity design partner across the majority of AT&T's markets.

To further augment the our capabilities and Market position in fiber. We recently closed deal to acquire the Telco network engineering business of mobia a privately owned company which will expand our fiber offering and fiber custom footprint in Canada.

Finally, in next gen Network modernization. Monetization A1 group in Europe, selected amdocs, billing charging and product catalog solution to establish a converge cloud ready. Monetization platform for team Macedonian affiliates.

turning now to the count operating environment on slide 12

We continue to see rich and encouraging pipeline of opportunities across our large server terms on the market of nearly 60 billion dollars.

Our 12 month, backlog position is healthy. And I, as I mentioned, we are on track to achieve our double digit growth Target in Cloud this year.

That said, we are closely watching any impact of the uncertain global macroeconomic environment on us and our customers spending Behavior.

Bringing it all together, on slide 13. When I expect slightly better Revenue growth of roughly 2.9% in performer. Constant currency at the midpoint of fiscal 2025 output equating to an improvement of about 20 basis point compared with our Piper designers,

We are also on track to deliver double digit expected, total, share return for the fifth consecutive year. Assuming the midpoint of our non-gaap diluted earning per share Outlook supported by significant improved profitable and robust earning to cash conversion.

With that, let me turn to call to Tamar for every month.

Thank you, Shuki, and hello everyone. Thank you for joining us.

Before I begin in today's comments, I will compare certain Financial metrics on a performer basis which adjusts prior fiscal year 2024 Revenue by approximately 600 million dollars.

To reflect the phase out of certain low margin non-core business activities, which were substantially already seized in the first quarter of fiscal 2025.

To further assist you modeling the regional mix of this Revenue was similar to the overall company and it contributed roughly 150 million per quarter.

To begin. I'm pleased with our solid financial performance for the third fiscal quarter as detailed on slide 15.

Q3 revenue of approximately 1.14 billion dollars was up 3.5% year-over-year in both former constant currency and exceeded the midpoint of our guidance. Even after adjusting, for a positive impact from foreign currency movements of approximately 9 million dollars compared to our assumptions.

Reflecting the phase out of certain business activities reported Revenue declined by 8.4% from a year ago.

On a regional basis. North America improved by 1% sequentially, posting its strongest quarter of the fiscal year.

Europe, delivered, a record quarter with yarova Revenue, growth of nearly 8% driven primarily by the ramp up of New Deal, activities as well as some contribution from the earlier acquisition of profit, which we closed at the end of q1.

Best of the world was slightly higher on a sequential basis. We continue to see mixed Trends while Salvage. The Asia growth is partially offset by weakness in Latin America.

Non Gap. Operating margin of 21.4%. Improved by 280 basis points from a year ago, reflecting the announced phase out of the low margin non-core, business activities, and the benefits of ongoing efficiency gains within our operations.

Net Gap. Operating margin improved by 10 basis point sequentially.

Interest in other expenses, amounted to roughly 11.7 million in the third quarter and included a 1-time charge taking in respect to 2 and a half million, right off of a small minority investment. This quarter.

On the bottom line, non-gaap diluted DPS of 1.72. Was the penny above the midpoint of guidance and diluted gaap? EPS of 1.39 was slightly above our guidance range in the third quarter.

Most slide 16 revenue for managed Services, was a record 771 million in the third fiscal quarter up 4.1% from a year ago.

Accounting for roughly 2/3 of total revenue managed Services. Engagements are a key measure of unbox long-term visibility and business. Resiliency underpinned by customer renewal rates which are historically approached, 100%

To provide some recent examples of the ways in which we deliver value to our managed Services customers over time.

We recently signed a significant multi-year agreement, which extends and expands our managed Services engagement with the leading US service provider leveraging, our generative, AI powered platform.

In Australia, tails for extended, its managed Services engagement, continuing a multi-year ossd. Sorry digitization, which will enable it to benefit from our knee and network automation capabilities.

And BT has awarded them dogs. A digital transformation project.

Starting dates to be finalized that will enhance their consumer customer experience as a part of a multi-year, managed Services engagement.

Moving to the balance sheet and cash flow. Highlights on, slide 17, they solve 76 days was down by 1 day sequentially and up to 2 days year, over year, reflecting a normal fluctuations in business activity

And build receivables, net of deferred revenue declined by 71 million sequentially in Q3 aggregating. The short-term and long-term balances.

This is the second consecutive quarter of sequential improvement in this metric, as billings have been running higher than revenue.

As a reminder, the net difference between and build receivables and deferred revenue, fluctuates from quarter to quarter in line with normal business activities, as well as our progress on multi-year transformation programs.

With free cash flow before restructuring payments of 230 million. In Q3 we are on track to achieve our annual Target.

Including restructuring payments of 19 million reported, free cash, flow was 212 million.

Overall, we ended Q3 with the healthy cash balance of approximately 342 million and then available 500 million revolving credit facility. Providing ample liquidity to support our ongoing business needs while retaining the capacity to fund our future strategic growth.

Switching to Capital allocation of slide 18.

This quarter, we repurchased 135 million of our shares.

Including the new 1 billion Cherie purchase, authorization approved, by our board. Last quarter.

We had up to 1.12% as of June 30th 2025.

We paid cash dividends of 59 million in the third fiscal quarter.

Looking ahead. We are writing our annual free cash flow Target of between 710 to 730 million in fiscal 2025, which is before structuring payments.

Annual free cash flow Outlook equates to a conversion rate of more than 90% relative to expected non-gaap net income and translates to a healthy free cash flow yield of more than 7% relative to Andros current market capitalization.

Regarding our Capital locations in fiscal years 2025, we expect to return the majority of our free cash flow to shareholders.

Moving to slide 19. 12 months backlog was 4.15 billion at the end of Q3 up 3% from a year ago on a performance basis.

We expect 12 months backlog to represent. Roughly 90% of forward-looking Revenue filed their underscoring, the importance of this metric as a leading indicator of our business.

Environment.

The fourth quarter and full fiscal year. 2025 Financial guidance, reflects what we consider to be the most likely outcome based on the information we have today, but we cannot predict all possible scenarios.

For the full fiscal year 2025. We now expect Revenue growth of between 2.4%, and 3.4% in performer, constant currency. There's 2.9%, midpoint of which equates to an improvement of roughly 20 basis points of compared, with our previous outlooks.

Our annual guidance, incorporates double digit growth in cloud and some contribution from inorganic deal activity.

As to the fourth fiscal quarter, we expect revenue between 1.1, to 5 billion to 1.165 billion.

And for your modeling purposes revenue from acquisition of mobiuz network, engineering business will be immaterial in Q4.

Moving down the income statement, we are on track to produce nanga operating margins within our guidance. Range of 21.1% to 21.7% in fiscal year 2025.

The midpoint of our guidance equates to a substantial increase of roughly 300 basis points this fiscal year.

Roughly 230 basis points of which is from the previously announced phase out of business activities and now the 60 to 70 basis points of margin expansion is resulting from our continued. Focus on operational, excellence Automation, and the gradual implementation of Genai.

As part of our process of accelerating, the internal adoption of Genai across everything we do at amdocs, we are proactively evaluating our Strategic investment priorities for fiscal 2026.

Having regard to our future Workforce location and the optimal mix of Technology infrastructure, workspace, and other resources.

Below. The operating line foreign currency fluctuations in hedging costs are expected to impact non-gaap net interest in other expense by roughly several million dollars on the quarterly basis.

We expect our non-gaap effective tax rate for fiscal 2025 to be within an annual target range of 15% to 17% for the full fiscal year, 2025 consistent, with our initial guidance.

Wrapping everything together on slide 22. We now expect non-gaap diluted earning per share growth within a tighter range of 8% and 9% for the full fiscal year 2025.

The 8.5 midpoint of, which is unchanged as compared with our prior Outlook of 6 and 1/2 to 8. Sorry to 10 and a half previously.

Assuming the 8 and 1/2 midpoint we are on track to achieve double digit expected total. Shoulders return for a fifth consecutive year in fiscal 2025 including our dividend yield.

With that back to you Shuki.

Thanks to Mark. I'm pleased with our solid financial performance and business achievement in the third quarter, including our ongoing momentum in cloud and encouraging signs of commercial progress in Genai and data services. With our unique technology-led business model. We are on track to meet of national targets for the fossil fuel.

With that, we are happy to take your questions.

Certainly. And our first question for today, comes from the line of George Nutter from Wolfe research your question, please?

Thanks very much. Um I guess I wanted to start just by asking you about uh the British Telecom. When I I you know, looking back I I don't think you guys did much business there. Um

I guess I'm just wondering, um, you know how big that opportunity is for you if you could size it, that would be very interesting. Um, you know, also, if I go back, you know, in the last 3 or 6 months you guys talked about, you know, some bigger deals kind of working through your pipeline. I assume you were referencing the, the, the, the BT transaction. Um, and then also, I'm just curious if that BT situation is in is, in backlog, at this point or not.

Thanks.

Uh, the the second question is not in our backlog because it was signed after June June 30th. And second we did have, we are doing many years business with what used to be everything everywhere, which was acquired by British Telecom, and and they are running some of our Legacy platform. And this deal is actually modernizing all the Commerce domain of everything everywhere. It's a it's a combination of a full modernization project within a extended minute services to support everything there. So it's a incremental activity, in significant incremental, activity to our previous activities uh, with everything everywhere which is now BT.

To your other point about having significant deals in the pipeline. We, we mentioned a couple of examples that were signed in the quarter. Some of which, I would say, are important and strategic, not necessarily huge in size, like Telstra and some of which, like, uh, the US leading operator, which we cannot mention by name. Right now is a significant deal including modernization including Genai, including multi-year, managed Services extension and expansion. So um, definitely um, an example of of a deal that is on the other, I would say scale in terms of sizing so. So we see both charge and, and yes, we continue to sign deals as we speak. So, um, you know where life is cut in a way by a cut off point on June 30th, but in reality, it continues obviously in the weeks since

Got it. That's great. And then um I guess I'd also just asked about um you know, AI um,

You know, I know you guys I think had around a dozen uh PC's going on with the Amaze product. I think mainly in call center types of applications, I was just curious about, you know, what kind of progress you're making there have, you had customers convert from trial to, uh, to production rollouts, you know, anything? You can say there would be interesting too, thanks a lot.

Uh, thanks Joel. So we converted the actually 4 uh, different customer from PCS to.

A to actual deal this quarter and this uh in in 1 of them, in the UAE, is the expansion of the previous deal that we've signed. And actually, we are, we are there? We continued and expanding building agents on top of the, the infrastructure that we've built in the other, um, in the other 3 customer that we mentioned, we are installing RMA platform. And, uh, we are building starting to build use cases, on top of it. Uh, we are helping also the customer to arrange the data to support it and it's a combination of care related. Uh billing care or care related, use cases and also uh Commerce and upsell use cases.

Great. Okay. Thank you very much.

Thank you. And our next question comes from the line of slow-mo. Rosen, bomb from stifel your question, please.

Hi, thank you very much. Um, it's good to hear about all the the deals and um, I just want to follow on a comment that you made tomorrow about, you know, the June 30th being kind of a, just a cut up point in time. So the first time in, in many years, that we've seen a sequential, uh, tick down even over its small and backlog. It's down 20 million.

Can you talk a little bit about that in in what, you know what's contributing to that? And then afterwards, I just want to ask a little bit more following up on the AI deals. If you could just help kind of dimensionalized them, and do you think that that's going to, you know, at what point in time, will we help see that be incremental to revenue growth? Uh, so, you know, kind of lifting up the expectation, uh, for, you know, Revenue growth on a year-over-year basis, even even just a little bit.

Thanks a lot.

So when we look on backlog and and they always say it's, it's a good leading indicator, you know, as we look on the next 12 months backlog and and we continue to see nice year-over-year growth. 3%. This quarter, you write sequentially, it was down 20. I'm I'm less uh focused on that since eventually, you know signing of deals can happen on August 1st and August 2nd and and you're right. That is unusual. But on the same time, we've seen deals being signed like the bt1. That is a significant 1 and others.

Um, so we have focused on looking forward and continue to see the back of the, um, giving us great visibility. You know, we talked about roughly 90%, uh, never take it day, you know, as an accurate mathematical formula, but but it is giving us a good coverage as we look forward. Both, in terms of understanding the revenue picture as well as the ability to plan, which is really important in terms of resources and how we are thinking about executing the deals and being prepared to do so.

Actually comes first typically in the cycle in terms of getting the data ready and the services that are associated with that as well as um data 1 platform in order to help customers do so. So this is the 2, I would say vectors that we are seeing from Pure Revenue. Point of view, the data related activities are bigger right now and the Gen AI use cases are the ones we are as we said, converting now from plc's to commercial deals and we like this conversion rate and we expect to see more as we move forward.

Thank you.

Thank you.

Thank you.

Timothy Herren from UPenn your question, please.

Thanks guys. Uh the North American win, is that a relatively? You know, smaller customer. That's going to become, you know, larger or you know, can you give us some sense of how how meaningful the material that is and then, um, can you tell us a bigger customer that become bigger?

um,

The SAS products can you tell us how meaningful that is the overall revenue or maybe just incremental, you know, Revenue growth at this point? And I know you talk a lot about connect X. Um, are there other SAS products that are doing well?

I will start to describe the the South Pole that can Market give more. It's going double digit. I mean, it's, it's a go Center for. We have several South product. There is obviously the connect X Market 1, which is our monetization platform is also source and our eing platform is a is also a SAS platform. So we have we think that we we developed quietly nice and I think in esim we have more than 40 customers worldwide. And so we see more and more traction. I think the the, the obviously, the connect X getting a lot for the attention lately, because this is really, really? We, we achieved the, I don't know, 10 customers. Well and it's the it's the it's the newest 1 and 1 that we launched to the market, several quarters ago and you see very nice traction since addressing both the MV and the opportunity as well as the digital brands of the larger players.

Um, and and people are really excited about the, you know, we mentioned, for example, Consumer Cellular love. It's a new window of last quarter. This quarter already, we've seen expansion of the business with them. Um, so the momentum is being built. Now, it

Aggregating all of the revenue we see in the SaaS business, it's not in the hundreds of millions, don't get me wrong. But the fact that it's going very nicely and is obviously generating as it scales up, a nice margin is giving us the appetite, I would say, to invest more into these kinds of offerings.

And do you have a sense of where we are in the cloud Migration, by by your customers, you know, maybe you know what percentage or what any, you know, we're in and do they recognize that they have to migrate to the cloud to really, you know, use gen Ai. And, you know, are they thinking that gen AI is going to really help them, move the needle, fundamentally,

I I I think it's 2, different things. I think that, um, also, we are using Genai tools, but, uh, many customers, AMD dogs started, the journey, uh, to move to the cloud. The journey includes obviously, uh, some type of Consulting. Uh, and and then you need to have all the activity of taking the platform to the cloud and you have migration. So it's not a it's not a simple necessarily definitely. It's not a short project. So we have many, many

Customers that are start, it, they are starting to immigration on the mids of the migration, but, uh, I would say less than handful of amdocs customer completed that, but we really, we, we did start the journey for with many customers. So, there is a lot of a lot of activities ahead of us in, in this specific domain.

And LESA tomorrow, the the margin expansion, you saw this year, 6070 basis points, you think that's, you know, sustainable or repeatable thanks.

Is that we have the the tech lead and build that into the way we do things internally.

Thank you.

question at this time, please press star 1, 1 on your telephone,

And our next question comes from the line of talion. From perk of America. Your question, please.

Hi, guys. This is Kevin need to prune on for tolani of Bank of America. Uh, I have 2 questions for you. Um, the first 1 is about G, and I know we already had some questions about G, but I wanted to ask you a little bit of a different sense. Um, in the terms of

What do you guys think about the potential for G to contribute meaningfully to revenue over time? Um whether it's a standalone opportunity or an accelerator of the existing service lines um and directly speaking, you know is it crazy to think that in a year from now that Jen AI is a meaningful contributor to revenues or is this still a few years out?

I think, what we

as we expected doing the year, we had,

Several or I would say quite a lot of both of Concepts engagement with customers that are evaluating the capabilities, how to take it into supporting their business, either to create a better customer experience or or reduce cost. And create efficiencies, we are starting to see conversion again, as expected of this proof of concept into commercial deals now,

The pace is hard to predict.

Another thing that we are seeing, as I noted before, is that a lot of the investment needs to go into the data layer, meaning, in order to be ready to leverage the opportunity of Genai, their needs to shy, like to call it the plumbing, the plumbing behind the scenes of the data domains. So we do see the revenue picking up on that aspect already. Um, we are not in a, in a, with a crystal ball with saying to, say exactly what's going to be the revenue contribution and the pace of maturity. But I'm optimistic, as we are seeing it. I mean, we are seeing the value, we're seeing the dialogue with customers, they stock, definitely to experiment, and move to commercial. Deployments we are seeing, it's not just when we say proof of concept just to be clear, it's not in a lab, it's taking real production environments, real customer data and showing concrete kpis Improvement relative to the comparison.

So, the, the I would say the elements are there.

The pace of the impact of Revenue yet to be seen.

Got it. Thank you. Um, and then again, I'm not asking for any number. Um, but just again directionally, you know, as we get towards the end of the year and and to facilitate your 26th, can you maybe speak to some of the broader demand Trends? You're seeing across your service lines? Is there anything you know structural or secular drivers or anything that's really sticking out? Um that would make you believe.

Believe that, you know, the current fiscal year growth rate of fiscal year 25 growth rate could differ up or down in fiscal year 26, or are we seeing kind of more, uh, consistent trends?

Um, I think that's from from a spending Behavior. We see the same

still the same uh uncertainty we discussed before and you know because of different rates and uh

Be, you know, macroeconomics, geopolitical and others. So we see the same interest rate Cuts, Etc. So we see the same, um, same pressure on spending but it's the same. We don't see any change. I think from this quarter to previous quarter and we don't see any erosion but at the same time we don't see necessarily that these things is changing, but but we believe we are

So far, uh, we are never getting in pretty much the same environment that we that we have in the in the power portals.

Got it. Thank you guys.

Thank you. Thank you.

Thank you. 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.

Thanks, operator. And thanks, everyone, for joining the call. If you do have any additional questions, please give us a call here in the IR department. With that, have a great night. Thanks.

Thank you, ladies and gentlemen for your participation. In today's conference, this does conclude the program. You may now disconnect good day.