Q3 2025 Altus Group Ltd Earnings Call
All lines have been placed on mute to prevent any background noise.
After the Speakers' remarks, there will be a question and answer session.
If you would like to ask a question. During this time simply press star followed by the number one on your telephone keypad if.
If you would like to withdraw your question Press Star one again. Thank you I would now like to turn the call over to Camilla Chief Communications Officer, you may begin.
Thank you operator, hi, everyone and welcome to the conference call and webcast discussing Altus group's Q3 results for the period ended September 30th 2025.
Our press release MD&A financial statements and the slides accompanying our prepared remarks are all available on our website and is required after the violence of theaters bus after market close this afternoon.
In conjunction with our earnings release. This afternoon also she was also announced that our CEO Jim had and that's the part of the company effective immediately my Gordon Altice groups, former CEO and director since 'twenty 'twenty has been appointed executive chair effective immediately and has agreed to assume the steel rules and she wants 2026.
Concurrently raising the Polish it stepping down from the chair roles and remaining on the board as a director of the press release can also be found on our website.
I'm joined today by Covenant as well as my important we also have rich circus, the precedent of software and data joining us for the Q&A portion of the call.
Some of our remarks on this call and in our disclosure may contain forward looking information that is based on certain assumptions and therefore subject to risks and uncertainties that could cause actual results to differ materially from those projected.
Referring to our forward looking disclaimer in today's materials.
Please be reminded that Altus group uses certain non-GAAP financial measures ratios total segments measures capital management measures in supplementary and other financial measures.
Fine and National instrument 50 to 112.
We believe that these measures may assist investors in assessing an investment in our shares as they provide additional insight into our performance.
Readers are cautioned that they are not defined performance measures and do not have any standardized meaning a guy for us and may differ from similar computations. That's reported by other entities and accordingly may not be comparable to those financial measures as reported by those entities. These measures should not be considered in isolation or a substitute.
For financial measures prepared in accordance with IRS.
An explanation of these measures as detailed in today's IR materials.
I would also like to point out that unless otherwise specified all the percentage and basis points of growth rates. We referred to on this call today will be on a constant currency basis over the same period in 2024.
I'll now turn it over to Mike Gordon.
Thank you Sunil and Hello, everyone before.
Before we discuss our results I wanted to take a few moments to address leadership changes, we announced earlier today as well as the conclusion of our strategic review.
On behalf of the board.
Speaker #1: As reported by other entities and accordingly may not be comparable to those financial measures as reported by those entities . These measures should not be considered an isolation or as substitutes for financial measures prepared in accordance with IFRS .
Operator: Call and webcast. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Camilla, Chief Communications Officer. You may begin.
I want to thank Jim for his contributions to the company as well as to Ray for his years of service as the chair as he transitions into a director role.
There are leadership vision and tireless efforts over the past several years have established a strong foundation.
Speaker #1: An explanation of these measures is detailed in today's IR materials . I'd also like to point out that unless otherwise specified , all the percentage of basis point growth rates we refer to on this call today will be on a constant currency basis over the same period in 2024 .
Jim has played an integral role in positioning Altice group for the opportunity as a pure play software data and analytics platform.
Camilla Bartosiewicz: Thank you, Operator. Hi, everyone, and welcome to the conference call and webcast discussing Altus Q3 results for the period ended 30 September 2025. Our press release, MD&A, financial statements, and the slides accompanying our prepared remarks are all available on our website, and as required, have been filed to SEDAR+ after market close this afternoon. In conjunction with our earnings release this afternoon, Altus Group also announced that our CEO, Jim Hannon, has departed the company effective immediately. Mike Gordon, Altus Group's former CEO and director since 2020, has been appointed Executive Chair effective immediately, and has agreed to assume the CEO role in Q1 2026. Concurrently, Rayne Mikulich is stepping down from the chair role and remaining on the board as a director. The press release can also be found on our website. I'm joined today by Pavan as well as Mike Gordon.
During his tenure, we successfully strengthened our platform, we refined our market approach and.
Speaker #1: I'll now turn it over to Mike Gordon .
Speaker #2: Thank you Camilla , and hello everyone . Before we discuss our results , I want to take a few moments to address the leadership changes .
And we improved how we're going to operate across the business.
There's also grew with vendors this next group space.
Speaker #2: We announced earlier today . As well as the conclusion of our strategic review . On behalf of the board , I want to thank Jim for his contributions to the company , as well as to Ray for his years of service as the chair as he transitions into a director role , their leadership , vision and tireless efforts over the past several years have established a strong foundation .
Our focus shifts from operational build out.
The accelerating market adoption of our new product innovations.
And improving our profitability and focus across the businesses.
Making this the right time for a leadership change that aligns with Altus group's future needs.
I look forward to carrying the momentum forward and accelerating the pace of progress as I step into the executive chair and eventually we CEO.
Speaker #2: Jim has played an integral role in positioning Altus group for the opportunity as a pure play software , data and analytics platform . During his tenure , we successfully strengthened our platform .
Now, let me touch briefly on the conclusion of our strategic review.
The board undertook a disciplined and a thorough strategic review process as we periodically do.
Speaker #2: We refined our market approach and we improved how we are going to operate across the business . As Altus Group enters its next growth phase .
Camilla Bartosiewicz: We also have Rich Sarkis, the President of Software and Data, joining us for the Q&A portion of the call. Some of our remarks on this call and in our disclosure may contain forward-looking information that is based on certain assumptions and therefore subject to risks and uncertainties that could cause actual results to differ materially from those projected. Please refer to our forward-looking disclaimer in today's materials. Please be reminded that Altus Group uses certain non-GAAP financial measures, ratios, total segment measures, capital management measures, and supplementary and other financial measures as defined in National Instrument 50-212. We believe that these measures may assist investors in assessing an investment in our shares, as they provide additional insight into our performance.
To evaluate potential options for maximizing the shareholder or are you sure the shareholder value.
Shareholders.
Speaker #2: Our focus shifts from operational build out to accelerating market adoption of our new product innovations and improving our profitability and focus across the businesses .
A company engaged in a fulsome review, which.
Which include a consideration of a wide spectrum of strategic alternatives, including soliciting interest from potential acquirers.
Speaker #2: Making this the right time for a leadership change that aligns with Altus Group's future needs . I look forward to carrying the momentum forward and accelerating the pace of progress as I step into the executive chair and eventually the CEO role .
After careful consideration of these alternatives, including reviewing multiple proposals the board determined that remaining independent and continuing to execute and accelerate that strategy is the best path forward for all of this group and to maximize the value for shareholders.
Speaker #2: Now , let me touch briefly on the conclusion of our strategic review . The board undertook a disciplined and thorough strategic review process as we periodically do to evaluate potential options for maximizing the shareholder of our shareholder value of our shareholders .
The company has undergone significant.
This transformation in recent years to operate more efficiently and transition into a pure play CRE software data and analytics platform.
Camilla Bartosiewicz: We use our caution that they are not defined performance measures and do not have any standardized meaning under IFRS, and may differ from similar computations as reported by other entities and, accordingly, may not be comparable to those financial measures as reported by those entities. These measures should not be considered in isolation or as substitutes for financial measures prepared in accordance with IFRS. An explanation of these measures is detailed in today's IR materials. I would also like to point out that unless otherwise specified, all the percentage and basis point growth rates we refer to on this call today will be on a constant currency basis over the same period in 2024. I'll now turn it over to Mike Gordon.
Altice group is in the early stages of its new product cycle as market conditions strengthen and the benefits of its operational strategic transformation are beginning to take hold.
Speaker #2: The company engaged in a fulsome review , which included consideration of a wide spectrum of strategic alternatives , including soliciting interest from potential acquirers .
Our board believes that these factors present considerable upside potential for the company's shareholders in the periods ahead.
Speaker #2: After careful consideration of these alternatives , including reviewing multiple proposals , the board determined that remaining independent and continuing to execute and accelerate its strategy is the best path forward for Altus Group and to maximize the value for its shareholders .
The strategic review gave us tremendous insight and reinforce confidence in our value creation plan.
The cable lay with clear priorities and a strengthened conviction what needs to be done and how we need to execute to accelerate our momentum.
Speaker #2: The company has undergone significant business transformation in recent years to operate more efficiently and transition into a pure play Cree software , data and analytics platform .
Altice group is at a critical inflection point and I am excited to execute on this opportunity for our shareholders.
Mike Gordon: Thank you, Camilla. Hello, everyone. Before we discuss our results, I want to take a few moments to address the leadership changes we announced earlier today, as well as the conclusion of our strategic review. On behalf of the board, I want to thank Jim for his contributions to the company, as well as to Ray for his years of service as the chair as he transitions into a director role. Their leadership, vision, and tireless efforts over the past several years have established a strong foundation. Jim has played an integral role in positioning Altus Group for the opportunity as a pure-play software, data, and analytics platform. During his tenure, we successfully strengthened our platform, refined our market approach, and improved how we are going to operate across the business.
The team is really looking forward to taking all of these through our value creation plan at our upcoming Investor Day on November 20.
Speaker #2: Altus Group is in the early stages of its new product cycle , as market conditions strengthen and the benefits of its operational and strategic transformation are beginning to take hold .
Among other things, we're planning to introduce new financial disclosures and walk you through the growth and profitability algorithm of our mid term goals I Hope you all can join us.
Speaker #2: Our board believes that these factors present considerable upside potential for the company's shareholders in the periods ahead . The strategic review gave us tremendous insight and reinforced confidence in our value creation plan .
I'll now turn things over to Paul to dive into our quarterly results.
Thank you, Mike I want to personally thank Jim and Randy for their leadership and contributions that the foundation laid out we will continue to guide our execution and drive value for shareholders.
Speaker #2: We came away with clear priorities and a strengthened conviction of what needs to be done and how we need to execute to accelerate our momentum .
Let me start with a few key highlights from the quarter. These included a sustained growth in recurring revenue improved operating leverage and strong cash flow generation.
Speaker #2: Altus Group is at a critical inflection point , and I'm excited to execute on this opportunity for our shareholders . The team is really looking forward to taking all of you through our value creation plan at our upcoming Investor Day on November 20th .
Mike Gordon: As Altus Group ventures its next growth phase, our focus shifts from operational build-out to accelerating market adoption of our new product innovations, and improving our profitability and focus across the businesses, making this the right time for a leadership change that aligns with Altus Group's future needs. I look forward to carrying the momentum forward and accelerating the pace of progress as I step into the executive chair and eventually the CEO role. Now, let me touch briefly on the conclusion of our strategic review. The board undertook a disciplined and thorough strategic review process, as we periodically do, to evaluate potential options for maximizing the shareholder value of our shareholders. The company engaged in a fulsome review, which included consideration of a wide spectrum of strategic alternatives, including soliciting interest from potential acquirers.
<unk> revenue was up five 2% anchored by the strength of Argus intelligence, which delivered double digit growth for a second consecutive quarter.
Speaker #2: Among other things , we're planning to introduce new financial disclosures and walk you through the growth and profitability algorithm of our mid-term goals .
Consolidated revenue grew by 2.2% tempered by softer performance in the appraisals in depth development Advisory segment, and the impact of our ongoing portfolio simplification.
Speaker #2: I hope you all can join us . I'll now turn things over to pub to dive into our quarterly results . Thank you .
For the fifth quarter in a row, we delivered consolidated margin expansion consolidated margins grew by 230 basis points to 19, 2%.
Speaker #2: Mike . I want to personally thank .
Speaker #3: Jim and Ray for their leadership and contributions . To Foundation . They built will continue to guide our execution and drive value for shareholders .
Year to date margins are up 440 basis points.
Profit from continuing operations increased meaningfully underscoring the quality of our of our earnings.
Speaker #3: Let me start with a few key highlights from the quarter . These include sustained growth and recurring revenue , improved operating leverage and strong cash flow generation .
Adjusted EBITDA Rose 16, 1% year over year driven by.
Speaker #3: Recurring revenue was up 5.2% , anchored by the strength of Argus Intelligence , which delivered double digit growth for a second consecutive quarter .
Top line expansion of market intelligence and operating improvements in analytics as we continue to optimize that portfolio.
Adjusted EPS came in at 38 cents that way from the prior year as a result of both higher profit and lower share count following our buyback program.
Speaker #3: Consolidated revenue grew by 2.2% , tempered by softer performance in the appraisal , development Advisory segment and the impact of our ongoing portfolio of simplification .
Mike Gordon: After careful consideration of these alternatives, including reviewing multiple proposals, the board determined that remaining independent and continuing to execute and accelerate its strategy is the best path forward for Altus Group and to maximize the value for its shareholders. The company has undergone significant business transformation in recent years to operate more efficiently and transition into a pure-play CRE software, data, and analytics platform. Altus Group is in the early stages of its new product cycle as market conditions strengthen, and the benefits of its operational and strategic transformation are beginning to take hold. Our board believes that these factors present considerable upside potential for the company's shareholders in the periods ahead. The strategic review gave us tremendous insight and reinforced confidence in our value creation plan.
Cash provided by operating activities and free cash flow, where we're up in the quarter on an as reported basis by 22, 8% and 36, 5% respectively. These are strong results considering the comparative periods still have contribution from the divested property tax business.
Speaker #3: For the fifth quarter in a row , we delivered consolidated margin expansion . Consolidated margins grew by 230 basis points to 19.2% year to date .
Speaker #3: Margins are up 440 basis points . Profit from continuing operations increased meaningfully , underscoring the quality of our of our earnings . Adjusted EBITDA rose 16.1% year over year , driven by top line expansion of Argus Intelligence and operating improvements in analytics .
Notably free cash flow per share was up 45, 7%.
Our operational improvements and ongoing portfolio simplification are translated in a higher quality earnings compared to a year ago.
This has been and will continue to breathe and driver of cash flow improvements.
Speaker #3: As we continue to optimize our portfolio, adjusted EPs came in at $0.38, doubling from the prior year as a result of higher profit and a lower share count.
During the quarter page or further action to rightsize, altice, reducing head count and terminating leases and other contracts.
Speaker #3: Following our buyback program , cash provided by operating activities and free cash flow were up in the quarter on a reported basis by 22.8% and 36.5% , respectively .
In the quarter, we recorded $6 6 million in restructuring costs.
Turning to the analytics business segment, our revenue performance came in inline with our guidance expectations and outperformed on margin expansion.
Mike Gordon: We came away with clear priorities and a strengthened conviction of what needs to be done, and how we need to execute to accelerate our momentum. Altus Group is at a critical inflection point, and I'm excited to execute on this opportunity for our shareholders. The team is really looking forward to taking all of you through our value creation plan at our upcoming investor day on 20 November 2024. Among other things, we're planning to introduce new financial disclosures, and walk you through the growth and profitability algorithm of our midterm goals. I hope you all can join us. I'll now turn things over to Pavan to dive into our quarterly results.
Speaker #3: These were strong results considering the comparative period still had from the divested property tax business , most notably , free cash flow per share was up 45.7% .
As a side note as we talked about in a couple of calls we're no longer reporting on on new bookings as we plan to rollout can you kpis at our upcoming Investor day here shortly.
Speaker #3: Our operational improvements and ongoing portfolio simplification are translating the higher quality earnings compared to a year ago . This has been and will continue to be a driver of cash flow improvements during the quarter .
Recurring revenue as a key metric for our performance for a second consecutive quarter Argos intelligence was up double digits, reflecting strong renewals on the platform and good traction with our new pricing model.
CMS delivered moderate growth anchored by strong client relationships and pricing trends.
Speaker #3: We have further action to rightsize contribution contracts in the quarter. We recorded $6.6 million in restructuring costs. Turning to the analytics business segment.
Pavan Bhalla: Thank you, Mike. I want to firstly thank Jim and Ray for their leadership and contributions. The foundation they built will continue to guide our execution and drive value for shareholders. Let me start with a few key highlights from the quarter. These include sustained growth in recurring revenue, improved operating leverage, and strong cash flow generation. Recurring revenue was up 5.2%, anchored by the strength of ARGUS Intelligence, which delivered double-digit growth for a second consecutive quarter. Consolidated revenue grew by 2.2%, tempered by softer performance in the appraisals and development advisory segment, and the impact of our ongoing portfolio simplification. For the fifth quarter in a row, we delivered consolidated margin expansion. Consolidated margins grew by 230 basis points to 19.2%. Year-to-date margins are up 440 basis points. Profit from continuing operations increased meaningfully, underscoring the quality of our earnings. Adjusted EBITDA rose 16.1% year-over-year, driven by.
With CRE sentiment improving for well positioned as momentum builds.
Both businesses continue to exhibit low churn with net revenue retention levels above 100%.
Speaker #3: Our revenue performance came in line with our guidance , expectations and outperformed on margin expansion . As a side note , as we talked about in a couple of calls , we're no longer reporting on new bookings as we plan to roll out new KPIs at our upcoming Investor Day here shortly .
Margins continue to expand increasing by 250 basis points this quarter and year to date.
The improvement reflects a combination of factors revenue growth ongoing portfolio optimization enhanced delivery efficiency through our global service center benefits from restructuring initiatives and disciplined expense management.
Speaker #3: Recurring revenue is a key metric for our performance . For our second consecutive quarter . Argus intelligence was up double digits , reflecting strong renewals on the platform and good traction with our new pricing model .
Turning to the appraisals and development Advisory segment revenue and adjusted EBITDA were down reflecting softer market conditions across both businesses.
Speaker #3: DMs delivered moderate growth anchored by strong client relationships and pricing trends , with CRE , sentiment improving . For well positioned as momentum builds , both businesses continue to exhibit low churn with net revenue retention levels above 100% .
Crazy business, which operated exclusively in Canada was particularly impacted by the ongoing tariff uncertainty inflationary pressures and evolving monetary policy.
Turning to the balance sheet, we ended the quarter with $405 1 million in cash and 101 hundred $57 2 million and take that.
Speaker #3: Margins continue to expand , increasing by 50 basis points this quarter and year to date . The improvement reflects the combination of factors revenue growth , ongoing portfolio optimization , enhanced delivery efficiency through our global Service Center , benefits from restructuring initiatives and disciplined expense management .
Solving a funded debt to EBITDA ratio of one to one.
As a reminder, we fully executed our N civ last quarter retiring approximately three 3 million shares and reducing our outstanding share count to $43 2 million.
Pavan Bhalla: Top-line expansion of ARGUS Intelligence and operating improvements in analytics as we continue to optimize the portfolio. Adjusted EPS came in at $0.38, doubling from the prior year as a result of both higher profit and lower share count following our buyback program. Cash provided by operating activities and free cash flow were up in the quarter on an as-reported basis by 22.8% and 36.5%, respectively. These are strong results considering the comparative period still had contribution from the divested property tax business. Most notably, free cash flow per share was up 45.7%. Our operational improvements and ongoing portfolio simplification are translating to higher quality earnings compared to a year ago. This has been and will continue to be a driver of cash flow improvements. During the quarter, we took further action to right-size Altus, reducing headcount and terminating leases and other contracts.
Speaker #3: Turning to the appraisals and development advisory segment , revenue and adjusted EBITDA were down , reflecting softer market conditions across both businesses . The appraisal business , which operates exclusively in Canada , was particularly impacted by the ongoing tariff uncertainty , inflationary pressures and evolving monetary policy .
Year to date, we've returned $178 million to shareholders.
With a strong net cash position and consistent free cash flow generation, we continue to view buybacks as an effective way to return capital.
Forward to sharing more on our capital out of place capital allocation plans at Investor Day.
With respect to our fiscal 2025 business outlook, we're refining our full year guidance ranges to reflect current expectations.
Speaker #3: Turning to the balance sheet , we ended the quarter with 405.1 million in cash and 100 and 157.2 million in bank debt , resulting in a funded debt to EBITDA ratio of 1.21 .
Notably, we're taking a more conservative view on revenue and giving the ongoing softness in appraisal and debt Advisory segment, we're moderating our view on consolidated adjusted EBITDA adjusted EBITDA margin.
Speaker #3: As a reminder , we fully executed our NCIB last quarter , retiring approximately 3.3 million shares and reducing our outstanding share count to 43.2 million .
In the analytics segment were slightly moderating our revenue range.
Speaker #3: Year to date , we've returned 178 million to shareholders with a strong net cash position and consistent free cash flow generation . We continue to view buybacks as an effective way to return capital .
BMS continues to build momentum supported by strong client engagement and a healthy pipeline.
Pavan Bhalla: In the quarter, we recorded $6.6 million in restructuring costs. Turning to the analytics business segment, our revenue performance came in line with our guidance expectations, and outperformed on margin expansion. As a side note, as we talked about in a couple of calls, we're no longer reporting on new bookings as we plan to roll out new KPIs at our upcoming investor day here shortly. Recurring revenue is a key metric for our performance. For our second consecutive quarter, ARGUS Intelligence was up double digits, reflecting strong renewals on the platform, and good traction with our new pricing model. GMS delivered moderate growth, anchored by strong client relationships and pricing trend. With CRE sentiment improving, we're well-positioned as momentum builds. Both businesses continue to exhibit low churn, with net revenue retention levels above 100%. Margins continue to expand, increasing by 250 basis points this quarter and year-to-date.
Acceleration is expected to extend into 2026.
Remain confident in the trajectory and opportunity ahead.
Speaker #3: We look forward to sharing more on our capital allocation , capital allocation plans at Investor Day . With respect to our fiscal 2025 business outlook , we're refining our full year guidance ranges to reflect current expectations .
Rguest intelligence continues to perform well and remains a consistent bright spot.
We're seeing growing optimism across our client base.
Market activity is picking up capital is becoming more accessible and valuations are rebounding with Q3 asset how you're showing double digit gains across all major major CRE sectors.
Speaker #3: Notably , we're taking a more conservative view on revenue and giving the ongoing softness in appraisal and debt advisory segment for moderating our view on consolidated adjusted , adjusted EBITDA margins in the analytic segment , we're slightly moderating our revenue range .
Really strong setup heading into next year.
In fact, the team is once again really looking forward to taking you through our value creation plan at our upcoming Investor Day on November 20.
Speaker #3: BMS continues to build momentum , supported by strong client engagement and a healthy pipeline with the broader acceleration is expected to extend into 2026 .
Before we take questions I want to thank our employees for an exceptional quarter and for the ongoing work to finish the year strong payout.
Hey, operator, let's open the lines up for questions go ahead. Please.
Speaker #3: We remain confident in the trajectory and opportunity ahead . Argus intelligence continues to perform well and remains a consistent bright spot we're seeing growing optimism across our client base market activity is picking up .
At this time I would like to remind everyone in order to ask a question Press Star then the number one on your telephone keypad.
And your first question comes from Stephen Macleod with BMO. Please go ahead.
Pavan Bhalla: The improvement reflects a combination of factors: revenue growth, ongoing portfolio optimization, enhanced delivery efficiency through our global service center, benefits from restructuring initiatives, and disciplined expense management. Turning to the appraisals and development advisory segment, revenue and adjusted EBITDA were down, reflecting softer market conditions across both businesses. The appraisal business, which operates exclusively in Canada, was particularly impacted by the ongoing tariff uncertainty, inflationary pressures, and evolving monetary policy. Turning to the balance sheet, we ended the quarter with CAD 405.1 million in cash and CAD 157.2 million in bank debt, resulting in a funded debt-to-EBITDA ratio of 1.21. As a reminder, we fully executed our NCIB last quarter, retiring approximately 3.3 million shares and reducing our outstanding share count to 43.2 million. Year-to-date, we've returned CAD 178 million to shareholders.
Speaker #3: Capital is becoming more accessible , and valuations are rebounding with Q3 asset values showing double digit gains across all major , major CRE sectors .
Thank you good afternoon, everyone and welcome.
Welcome back Mike.
I guess, so I guess just a couple of a couple of questions, maybe maybe for Mike and the team.
Speaker #3: It's a really strong setup heading into next year . The the team is once again really looking forward to taking you through our value creation plan at our upcoming Investor Day on November 20th .
Just with respect to the CEO change you are stepping into the role beginning in Q1.
Just curious if you can give a little bit color around I mean, I guess the biggest question is why why now.
Speaker #3: Before we take questions, I want to thank our employees for an exceptional quarter and for the ongoing work to finish the year strong.
Thanks, Steve and it's good to hear from you again, but it would be deaf on these calls we do.
Speaker #3: Okay . Operator . Let's open the lines up for questions now . Please .
I think why now is we looked at what we were trying to do is creating a new value creation plan what that plan would look like over the next three to five years and what we were trying to make sure is as we were starting to shift and accelerate what we're trying to do is make sure that we were.
Speaker #4: At this time , I would like to remind everyone , in order to ask a question , press star . Then the number one on your telephone keypad and your first question comes from Stephen McLeod with BMO .
Speaker #4: Please go ahead .
Speaker #5: Thank you . Good afternoon , everyone , and welcome back , Mike up . I guess I guess just a couple of couple of questions .
All aligned and as a result, as we've talked about this.
Order levels for instance, right.
As always sit back and say that means that he's got a couple of years left of that he felt that this would be the right time to move on and then as we also talked with Jim. We just came to the same conclusion and that was how we jumped into this as we were going to enter into 2026th so.
Speaker #5: You know , maybe maybe for Mike and the team , you know , just with respect to the CEO change and you stepping into the role beginning in Q1 .
Pavan Bhalla: With a strong net cash position and consistent free cash flow generation, we continue to view buybacks as an effective way to return capital. We look forward to sharing more on our capital allocation plans at investor day. With respect to our fiscal 2025 business outlook, we're refining our full-year guidance ranges to reflect current expectations. Notably, we're taking a more conservative view on revenue, given the ongoing softness in appraisal and debt advisory segment. We're moderating our view on consolidated adjusted EBITDA margins. In the analytics segment, we're slightly moderating our revenue range. GMS continues to build momentum, supported by strong client engagement and a healthy pipeline, but the broader acceleration is expected to extend into 2026. We remain confident in the trajectory and opportunity ahead. Argus Intelligence continues to perform well and remains a consistent bright spot.
Speaker #5: Just curious if you can give a little bit of color around . I mean , I guess the biggest question is , is , is why ?
Speaker #5: Why now ?
Speaker #2: Hey , Stephen , it's good to hear from you again . And I'm glad to be back on these calls with you . I think .
As we go through to the Investor Day, we felt pretty good about where everything was with the value creation plan and you want to talk with that to all of you of course.
Speaker #2: Why now is that we looked at what we were trying to do in creating a new value creation plan , and what that plan would look like over the next 3 to 5 years .
And then.
We just decided that this is the best for the company and best for all of the individuals.
Speaker #2: And what we were trying to make sure is , as we were starting to , we shift and accelerate what we were trying to do is make sure that we were all aligned .
Okay. That's that's helpful. Thanks, Mike.
And then maybe just just with respect to the strategic review and one of the things that sort of.
Speaker #2: And as a result , as we talked about this at the board level , for instance , Ray has always set back and said to me that he's got a couple of years left , and he felt that this would be the right time to move on .
So I guess my question is twofold one is.
Can you give a little bit of specifics around why.
Why we're meeting a standalone business is the right thing like what were the key care key characteristics. They looked at and then maybe secondly, along those lines.
Speaker #2: And then , as we also talked with Jim , we just came to the same conclusion . And that was how we jumped into this as we were going to enter into 2026 .
With respect to the portfolio simplification that you're going through.
Speaker #2: So as we go through into the Investor Day , we felt pretty good about where everything was with the value creation plan , and we want to talk with that to all of you .
You know, how how does that roll into kind of the outlook over the next few years.
Two great questions.
Pavan Bhalla: We're seeing growing optimism across our client base, market activity is picking up, capital is becoming more accessible, and valuations are rebounding, with Q3 asset values showing double-digit gains across all major CRE sectors. It's a really strong setup heading into next year. In fact, the team is once again really looking forward to taking you through our value creation plan at our upcoming investor day on 20 November. Before we take questions, I want to thank our employees for an exceptional quarter, and for the ongoing work to finish the year strong. Okay, operators, let's open the lines up for questions now, please.
Speaker #2: Of course . And then we just decided that this is best for the company and best for all the individuals .
So the strategic review, we had a framework in which we were looking at everything because what we were trying to do is get a good sense of we knew strategically what we want to build how we wanted to start to execute and how we wanted to accelerate across things and.
Speaker #5: Okay , that's that's helpful . Thanks , Mike . And then maybe just just with respect to the strategic review , and one of the things that sort of I guess my question is twofold .
Given.
Truly just the interest as a whole in our business.
Speaker #5: One is , you know , can you give a little bit of specifics around , you know , why why remaining a standalone business is the right thing .
Wanted to make sure that we.
We did a post merger.
And we did.
As we look three things.
Felt that it was better.
Speaker #5: Like , what were the key key characteristics that you looked at . And then maybe secondly , along those lines with respect to the portfolio simplification that you're going through , you know , how does that roll into kind of the outlook over the next few years ?
Stay as a standalone business, because we felt like we can execute and deliver more value for our shareholders through that execution in the short term and in the medium term so that we could actually put that forward.
Operator: At this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. Your first question comes from Stephen McLeod with BMO. Please go ahead.
As to the portfolio simplification.
Speaker #2: A two good questions to the strategic review . We had a framework in which we were looking at everything because what we were trying to do is get a good sense of we knew strategically what we wanted to build , how we wanted to start to execute and how we wanted to accelerate across things and given truly just the interest as a whole in our business , we wanted to make sure that we did a full review .
We started that last year.
And we are planning on really working through that very quickly as we enter into 2026.
Mike Gordon: Thank you. Good afternoon, everyone. Welcome back, Mike. I guess just a couple of questions, maybe for Mike and the team, just with respect to the CEO change and you stepping into the role beginning in Q1. Just curious if you can give a little bit of color around, I mean, I guess the biggest question is, why now?
Again, good good discussion for a couple of weeks from now, but we are.
As I said.
Our software data and analytics platform and Thats, how were looking at the business.
Okay. That's great. Thanks, Mike I'll leave it there queue back up I appreciate it.
Speaker #2: And we and we did . And as we looked through things , we felt that it was better to stay as a standalone business because we felt like we could execute and deliver more value for our shareholders through that execution .
Okay.
Your next question comes from the line of Gavin Fairweather with core Mark. Please go ahead.
Mike Gordon: Hey, Stephen. It's good to hear from you again, and I'm glad to be back on these calls with you. I think why now is we looked at what we were trying to do in creating a new value creation plan, what that plan would look like over the next three to five years. What we were trying to make sure is, as we were starting to shift and accelerate what we were trying to do, is make sure that we were all aligned. As a result, as we talked about this at the board level, for instance, Ray has always sat back and said to me that he's got a couple of years left and he felt that this would be the right time to move on.
Oh, Hey, good afternoon, and thanks for taking my question, it's nice to reconnect, Mike and happy to hear that our offices are saying public nice to hear maybe just firstly for me on Argus intelligence in the rollout nice to hear about the double digit growth. There last quarter. You did talk about the pricing that you're achieving on renewal maybe you could give us an update on how your results are tracking versus euro.
Speaker #2: In the short term and in the turn , so that we could actually put that forward . As to the portfolio simplification , we started that last year and we were planning on really working through that very quickly as we enter into 2026 .
15% target there.
Yeah look we are as we've mentioned.
Speaker #2: Again , good , good discussion for a couple of weeks from now . But we are as as I said , a software data and analytics platform .
Irrigation intelligence is billing terms that were in a very meaningful migration in that great pattern and Argos intelligence is performing extremely well.
Speaker #2: And that's how we're looking at the business .
Speaker #5: Okay . That's great . Thanks , Mike . I'll leave it there and queue back up . Appreciate it .
Mike Gordon: As we also talked with Jim, we just came to the same conclusion, and that was how we jumped into this as we were going to enter into 2026. As we go through into the investor day, we felt pretty good about where everything was with the value creation plan, and we want to talk with that to all of you, of course. We just decided that this is best for the company and best for all the individuals.
From a growth perspective, we're seeing high double digit growth in R&D some colleges.
Speaker #2: Thanks .
Speaker #4: Your next question comes from the line of Gavin Fairweather with Cormark . Please go ahead .
High double digit growth in our E. R. R. As I've mentioned, our net revenue retention, which is a function of.
Speaker #6: Oh hey , good afternoon and thanks for taking my questions . Nice to reconnect , Mike , and happy to hear that Altace staying public .
Cross selling upsell activity as well in other words, if a 100%.
Speaker #6: Nice to hear . Maybe just firstly for me on Argus Intelligence and the rollout . Nice to hear about the double digit growth there last quarter .
And even from a pure retention perspective.
We're having a great client and logo retention as clients are going to change.
Speaker #6: You did talk about the pricing that you were achieving on renewal . Maybe you could give us an update on how your results are tracking versus your 15% target .
Change, so highlighting very strong renewals of our customers.
Mike Gordon: Okay. That's helpful. Thanks, Mike. Maybe just with respect to the strategic review and one of the things that sort of, well, I guess my question is twofold. One is, can you give a little bit of specifics around why remaining a standalone business is the right thing? What were the key characteristics that you looked at? Maybe secondly, along those lines, with respect to the portfolio simplification that you're going through, how does that roll into kind of the outlook over the next few years?
It's showing the benefit of our price increase with which we are which clients are targeting.
Speaker #6: There .
Speaker #3: Yeah . Look , we as we mentioned , our intelligence is going through that . We're in a very meaningful migration and upgrade pattern .
And translating to very high customer revenue on logo retention.
We're roughly 56% of the way through.
Speaker #3: And our intelligence is performing extremely well from a from a growth perspective , we're seeing high double digit growth in Argus intelligence , high double digit growth in our IRR .
Operations to Argos intelligence.
I would say roughly about 70% of that is landing a seat base, 30% of that is landing and asset base and in both coming went down pretty meaningful price increases and so.
Speaker #3: As I mentioned , our net revenue retention , which is a function of cross-sell and upsell activities as well . North of 100% , and even from a pure retention perspective , you know , we're having a great client and love retention as clients are going through a change .
<unk>, it's a good proof point that that is delivering what the clients are looking for and can you give us a severity upon to help to continue to tend to drive adoption and had slipped more clients over to asset base over time.
Mike Gordon: Two good questions. The strategic review, we had a framework in which we were looking at everything because what we were trying to do is get a good sense of we knew strategically what we wanted to build, how we wanted to start to execute, and how we wanted to accelerate across things. Given truly just the interest as a whole in our business, we wanted to make sure that we did a fulsome review. We did. As we looked through things, we felt that it was better to stay as a standalone business because we felt like we could execute and deliver more value for our shareholders through that execution in the short term and in the medium term so that we could actually put that forward. As to the portfolio simplification.
Speaker #3: So highlighting very strong renewals of our customers , it's showing the benefit of our price increase , which which we are which clients are absorbing and translating to very high customer revenue and logo retention .
That's super helpful. I appreciate it and then just secondly for me on analytics margins. They just continue to surprise to the upside here I know you got your 35% target for next year, which the business is getting pretty close to here in the Q3. So I'm curious when you get when we get into a cyclical recovery I mean, there should be some nice margin tailwind is there anything preventing margins in analytics.
Speaker #3: But we're roughly 56% of the way through the migration to artists intelligence . And I would say roughly about 70% of that is landing as seat based .
I'm kind of pushing higher than that 35% like specific areas, where you might want to reinvest for growth.
Speaker #3: 30% of that is landing as asset based . And they're both coming down pretty meaningful . Price increases . And so , you know , one , it's a good point that that it's delivering what the clients are looking for .
Yeah.
Yeah.
We've talked about for quite some time that there are multiple paths for margin improvement for this business.
Mike Gordon: We started that last year, and we are planning on really working through that very quickly as we enter into 2026. Again, good discussion for a couple of weeks from now. We are, as I said, a software, data, and analytics platform, and that's how we're looking at the business.
Speaker #3: And to gives us a very long tail to continue to to drive adoption . And flip more clients over to asset based over time .
And so we continue to execute on that we're very pleased with that.
440 basis points expansion year to date on the consolidated level, but to your point again in that 250 banks banks that were getting but year to date from analytics. Obviously, it's a function of the fact that we're continuing to grow.
Speaker #6: That's super helpful . I appreciate it . And then just secondly , for me on analytics margins , they just continue to surprise to the upside here .
Speaker #6: I know you got your 35% target for next year , which is the business is getting pretty close to here in the Q3 .
Total and recurring revenue. Despite the fact that we're in a challenged commercial real estate market environment. Obviously, there are a lot of science.
Mike Gordon: Okay. That's great. Thanks, Mike. I'll leave it there and cue back up. Appreciate it.
Speaker #6: So I'm curious when you get when we get into a cyclical recovery , I mean , there should be some nice margin tailwinds .
Speaker #6: Is there anything preventing margins in analytics from kind of pushing higher than that ? 35% , like specific areas where you might want to reinvest for growth ?
Pavan Bhalla: Thanks.
Operator: Your next question comes from the line of Gavin Fairweather with Cormark. Please go ahead.
Dying, but that but in the current market environment for us to be able to get rent.
Gavin Fairweather: Oh, hey, good afternoon, and thanks for taking my questions. Nice to reconnect, Mike, and happy to hear that Altus is seeing public. Nice to hear. Maybe just firstly for me on ARGUS Intelligence and the rollout, nice to hear about the double-digit growth there. Last quarter, you did talk about the pricing that you were achieving on renewal. Maybe you could give us an update on how your results are tracking versus your 15% target there.
Level of growth that we're generating.
Speaker #3: Yeah , look , you know , we we've talked about for for quite some time that that there are multiple paths for margin improvement for , for this business .
Already.
Pretty phenomenal in my <unk>.
Buck.
We've also highlighted the fact that we continue to focus on portfolio simplification and so just proof of that with the disposal of bearings guaranteed business last year.
Speaker #3: And so we continue to execute on that . We're very pleased with the 440 basis points expansion year to date on a consolidated level .
And we're also consciously exiting at that.
Pavan Bhalla: Yeah. Look, as we mentioned, ARGUS Intelligence is going through a very meaningful migration and upgrade pattern, and ARGUS Intelligence is performing extremely well. From a growth perspective, we're seeing high double-digit growth in ARGUS Intelligence, high double-digit growth in our ARR. As I mentioned, our net revenue retention, which is a function of cross-sell and upsell activities, is well north of 100%. Even from a pure retention perspective, we're having great client and logo retention as clients are going through a change, highlighting very strong renewals of our customers. It's showing the benefit of our price increase, which the clients are absorbing and translating to very high customer revenue and logo retention. We're roughly 56% of the way through the migration to ARGUS Intelligence, and I would say roughly about 70% of that is landing as seat-based.
Speaker #3: To your point , Gavin , that 250 base bits that we're getting year to date from analytics , obviously it's a function of the fact that we're continuing to grow both total and recurring revenue , despite the fact that we're in a challenged commercial real estate market environment .
Services business, where we implement on all of those products as well as exiting some non profitable businesses.
And in Canada associated with the appraisal business. Despite that revenue headwind, we continue to be able to print very solid consolidated revenue growth and recurring revenue growth. So that's a great story for us.
Speaker #3: Obviously , there are a lot of signs of that dying , but but in the current market environment , for us to be able to get print that level of growth that we're generating is pretty , pretty phenomenal .
Obviously I highlighted in my prepared remarks, the notion that we continue to right size office.
Speaker #3: In my book , you know , we've also highlighted the fact that we continue to focus on portfolio simplification . And so just proof of that with the disposal of the various this last year .
And so we are.
Going through a pretty large restructuring.
Also I have a very large focus on G&A, which we'll talk a lot about at Investor day.
Coming to make sure that we will continue to rationalize both.
Speaker #3: And we're also consciously exiting the the , the services business , we implement non Altus products as well as exiting some non-profitable businesses and Canada associated with the appraisal business .
Our our span and our and our real estate footprint.
And so and we continue to deleverage the GSC I think roughly 15% of our employee base now.
In terms of total head count is hitting in the GSE and as you guys will hear from us at Investor Day, we're going to continue to push on that shelf Gavin. It's a great question. We're very proud of the margin improvement that we're delivering and Theres a lot of opportunity ahead of us to continue to do that and so we look forward to talking to you about that on.
Speaker #3: Despite that , revenue headwind , we continue to be able to print very solid consolidated revenue growth and recurring revenue growth . So that's a great news story for us .
Pavan Bhalla: 30% of that is landing as asset-based, and they're both coming with pretty meaningful price increases. One, it's a good proof point that it's delivering what the clients are looking for. Two, gives us a long tail to continue to drive adoption and flip more clients over to asset-based over time.
Speaker #3: You know , obviously , I highlighted in the prepared remarks the notion that we continue to rightsize Altus . And so we we are going through a pretty large restructuring .
On the 20th.
Thanks, so much somehow flawed.
Speaker #3: We also have a very large focus on G&A , which we'll talk a lot about at Investor Day , coming to make sure that we can continue to rationalize both .
Kevin.
Your next question comes from the line of Aaron Kyle with CIBC. Please go ahead.
Gavin Fairweather: That's super helpful. I appreciate it. Just secondly, for me on analytics margins, they just continue to surprise to the upside here. I know you got your 35% target for next year, which the business is getting pretty close to here in Q3. I'm curious, when we get into a cyclical recovery, I mean, there should be some nice margin tailwinds. Is there anything preventing margins in analytics from kind of pushing higher than that 35%, like specific areas where you might want to reinvest for growth?
Hi, Good evening I wanted to ask a question just on the guidance revision.
Speaker #3: You know , our , our , our span and our and our real estate footprint . And so and we continue to leverage the GSE , I think roughly 15% of our employee base now , in terms of total headcount and in the GSE and as you guys will hear from us , at Investor Day , we're going to continue to push on that .
Fiscal 2025 guidance last quarter, and then we've taken it down again this quarter. So I just wanted to dig into that a little bit I know last quarter. The guidance cut was due to the slower BMS activity.
It sounds like the answer to that is no but are you seeing any softness in our gift from cogent sales and are you still seeing a 20% yield on pricing that you mentioned last quarter and how should we think about the guidance revision for 25.
Speaker #3: So the Gavin , it's a great question . We're very proud of the margin improvement that we're delivering . And there's a lot of opportunity ahead of us to continue to do that .
Pavan Bhalla: Yeah. Look. We've talked about for quite some time that there are multiple paths for margin improvement for this business. We continue to execute on that. We're very pleased with the 440 basis points expansion year-to-date on a consolidated level. To your point, Gavin, the 250 basis points that we're getting year-to-date from analytics, obviously, it's a function of the fact that we're continuing to grow both total and recurring revenue despite the fact that we're in a challenged commercial real estate market environment. Obviously, there are a lot of signs of that dying, but in the current market environment, for us to be able to print the level of growth that we're generating is pretty phenomenal in my book. We've also highlighted the fact that we continue to focus on portfolio simplification.
Speaker #3: And and so we look forward to talking to you about that . On on the 20th .
Yeah, but we backed out we've got 60 days left to go in and in the year in the quarter. So obviously, we want to try that.
Speaker #6: Thanks so much . I'll pass line .
Speaker #2: Kevin .
Narrow the range down as much as possible.
Speaker #4: Your next question comes from the line of Aaron Kyle with CIBC . Please go ahead .
Everyone as it relates to the guidance I'm going to just you know again I'm not overly concerned with what the guidance concerning the reason for that is one rguest intelligence continues to fire on all cylinders as we mentioned in some of the prepared remarks and as I have just highlighted in regards to the <unk> growth that we're seeing.
Speaker #7: Hi . Good evening . I wanted to ask a question just on the guidance revision here . You trimmed fiscal 2020 guidance last quarter , and then we've taken it down again this quarter .
Speaker #7: So I just want to dig into that a little bit I know last quarter the guidance cut was due to the slower VMs activity .
That business.
Yeah, we did allude to the fact that there is a pricing uplift on that conversion on a blended basis, we're seeing about a 16% price increase.
Speaker #7: Sounds like the answer to this is no . But are you seeing any softness in Argus Intelligence sales . And are you still seeing that 20% yield on pricing that you mentioned last quarter ?
It is about 10% asset base is about 30% so.
Speaker #7: Or how should we think about the guidance revision for 25 ?
So very good price absorption and then when you match that up with the strong net revenue retention and strong gross revenue retention.
Speaker #3: Yeah , look , we've got we've got 60 days left to go in in in a year in the quarter . So obviously we want to try to narrow the range down as much as possible with everyone .
Pavan Bhalla: Just proof of that with the disposal of the fairways guaranteed business last year. We are also consciously exiting the services business where we implement all those products, as well as exiting some nonprofitable businesses in Canada associated with the appraisal business. Despite that revenue headwind, we continue to be able to print very solid consolidated revenue growth and recurring revenue growth. That's a great news story for us. Obviously, I highlighted in the prepared remarks the notion that we continue to right-size Altus. We are going through a pretty large restructuring. We also have a very large focus on G&A, which we'll talk a lot about at investor day upcoming to make sure that we can continue to rationalize both our span and our real estate footprint. We continue to leverage the GSE. I think roughly 15% of our employee base now.
With our clients.
Understand the value that's being delivered so that is a very positive story.
Speaker #3: As it relates to the guidance , I'm going to just I'm going to just , you know , again , I'm not overly concerned with with the guidance , concern and the reason for that is one Argus intelligence continues to fire on all cylinders .
From a permit from an analytics just to round out the story the other big component the other big core franchises VNS and we've talked about that.
Now a few times and assess that.
Speaker #3: As we mentioned in some of the prepared remarks and highlighted in regard to the RR and RR and GR growth that we're seeing in that business .
Our Vms revenue was predicated on our clients deploying assets and given the fact that we are seeing still a seven cap business and their approach to asset deployment.
Speaker #3: You know, we did allude to the fact that there is a pricing uplift on the conversion on a blended basis. We're seeing about a 16% price increase.
We are we're not seeing that inflection in Vms with that said we are we have a very healthy pipeline, we have a growing backlog and we do see that this opportunity is extending into 2026. So therefore, we're just right sizing the guidance for 2025.
Speaker #3: Seed is about 10% . Asset base is about 30% . So very good price absorption . And then when you match that up with the strong net revenue retention and strong gross revenue retention , it tells our clients understand the value that's being delivered .
With the inflection carried into 2026 appraisals and development Advisory is is lower than we had anticipated from a topline perspective, but the team is doing a phenomenal job in executing what.
Speaker #3: So that is a very positive story from a from a from an analytics just to round out the story , the other big component , the other big core franchise is VMs .
What we said we wanted them to do in terms of driving more profitable growth.
Speaker #3: We've talked about that a few times in the sense that , you , our VMs revenue is predicated on our clients deploying assets .
But that top that top line does have an impact on consolidated revenue, it's just math and so again the premise that the guidance Mr really helped.
Pavan Bhalla: In terms of total headcount, it is sitting in the GSE. As you guys will hear from us at investor day, we're going to continue to push on that. Gavin, it's a great question. We're very proud of the margin improvement that we're delivering, and there's a lot of opportunity ahead of us to continue to do that. We look forward to talking to you about that on the 20th.
Speaker #3: And given the fact that we are seeing still some tepidness in regards to asset deployment , we are we're not seeing that inflection in VMs .
But the Q4 and the full years do the math for you guys.
To give you a view of where do we see things are playing out.
Speaker #3: With that said , we have a very healthy pipeline . We have a growing backlog , and we do see that this opportunity is extending into 2026 .
Again.
Like I said, there is theres a lot of optimism in regards to where we are from them from a product roadmap and a commercialization perspective.
Gavin Fairweather: Thanks so much. Have a tough one.
Pavan Bhalla: Gavin.
Speaker #3: So therefore we're just rightsizing the guidance for 2025 with the inflection in the 2026 appraisals and development advisory is is lower than we had anticipated from a top line perspective , the team is doing a phenomenal job in executing what we said we wanted them to do in terms of driving more profitable growth , but that that top line does have an impact on consolidated revenue .
Operator: Your next question comes from the line of Aaron Kyle with CIBC. Please go ahead.
The CRE market is fine we are seeing positive signs of activity asset values.
Double digit gains across all major sectors on an annual basis from Q3.
Aaron Kyle: Hi. Good evening. I want to ask a question just on the guidance revision here. You turned fiscal 2025 guidance last quarter, and then we've taken it again this quarter. I just want to dig into that a little bit. I know last quarter the guidance cut was due to the slower VMS activity. Sounds like the answer to this is no, but are you seeing any softness in ARGUS Intelligence sales? Are you still seeing that 20% yield on pricing that you mentioned last quarter, or how should we think about the guidance revision for 2025?
Cost and availability of capital continue to improve.
That dovetails into an easing monetary policy.
Yeah. Thank you report that as of Q3 <unk> is estimating that that dry powder for commercial real estate stands at approximately 395 billion globally.
Speaker #3: It's just math . And so again , the premise that the guidance was to really help both the Q4 and the full year , do the math guys and give you a view of where we see things are playing out .
We are seeing transaction volume starting to trend in the right direction, albeit still down.
Low single digit year over year is up on a sequential basis.
Pavan Bhalla: Yeah. Look, we've got 60 days left to go in the year and the quarter. Obviously, we want to try to narrow the range down as much as possible with everyone. As it relates to the guidance, I'm going to just, again, I'm not overly concerned with the guidance concern. The reason for that is, one, ARGUS Intelligence continues to fire on all cylinders, as we mentioned in some of the prepared remarks. As I just highlighted in regards to the ARR, NRR, and GRR growth that we're seeing in that business, we gave a lead to the fact that there is a pricing uplift on the conversion. On a blended basis, we're seeing about a 16% price increase. Seed is about 10%. Asset base is about 30%. Very good price absorption.
Speaker #3: But again , like I said , there's a there's a lot of optimism in regards to where we are from . A from a product roadmap and a commercialization perspective that the CRE market is tied .
So as the market continues to signal price stability, and we are seeing favorable rate trajectories, all position us well to accelerate the market adoption of our new product innovation.
Speaker #3: We are seeing positive signs of activity. Asset values have seen double-digit gains across all major sectors on an annual basis in Q3.
We're really excited about 2026 and add finishing the year off strong.
Speaker #3: Cost and availability and capital continue to improve as effect dovetails into an easing monetary policy . You know , pick your report . But as a Q3 is estimating that dry powder for commercial real estate stands at approximately for you $395 billion globally .
Okay. That's that's helpful color on the guidance and maybe if I can just follow up with one another question on the strategic review and the conclusion. There you mentioned it was it was wide ranging and considering several ups and sitting at sort of the pacing of offers so maybe.
Maybe to the extent that you can comment where valuation that you are seeing throughout the process in line with what you would've expected or yeah anything you can add there for additional color would be great.
Speaker #3: We are seeing transaction volumes starting to trend in the right direction , albeit still down low . Single digit year over year . It is up on a sequential basis .
Pavan Bhalla: When you match that up with the strong net revenue retention and strong gross revenue retention, it tells our clients to understand the value that's being delivered. That is a very positive story. From an analytics, just to round out the story, the other big component, the other big core franchise is VMS. We've talked about that a few times in the sense that our VMS revenue is predicated on our clients' deploying assets. Given the fact that we are seeing still some toughness in regards to asset deployment, we're not seeing that inflection in VMS. With that said, we have a very healthy pipeline, we have a growing backlog, and we do see that this opportunity is extending into 2026. Therefore, we're just right-sizing the guidance for 2025, with the inflection period into 2026. Appraisals and development advisory is.
Yeah sure I mean, as I said I think that.
Speaker #3: So as the market continues to signal price stability and we are seeing favorable rate trajectories , these are all positioned us well to accelerate the market adoption of our new product innovation .
With the review that we did and we looked internally and externally and we also tried to look.
Different options Eric.
Speaker #3: So we're we're we're really excited about 2026 . And finishing the year off strong .
We did get figures that were.
I'd say pretty good when it came to the standpoint of valuations, but to be honest is weak.
Looked at our framework on how we were evaluating that and how we would execute going forward and what the team believes.
Speaker #7: Okay . That's helpful . Color on the guidance . And maybe if I can just follow up with one another question on the strategic review and the conclusion there .
We felt that there was more value that we could drive for our shareholders and as we sat down as a board it became evident that we do like what that execution plan would be.
Speaker #7: You mentioned it was it was wide ranging and considering several options , including the solicitation of offers . So maybe to the extent that you can comment , you know , we're valuations that you were seeing throughout the process in line with what you would have expected or yeah , anything you can add there for additional color would be great .
We knew how that we would take advantage of Argus intelligence.
And you said and how we were going to start to really think about the businesses, we're going to accelerate so.
We move forward with the game plan as we did and we know what we are marching towards over the next three to five years.
Speaker #2: Yeah , sure . I mean , as I said , I think that we with with the review that we did and we looked internally and externally and we also tried to look at many different options there .
Okay. Thank you I will pass the line.
Pavan Bhalla: Lower than we had anticipated from a top-line perspective. The team has been doing a phenomenal job in executing what we said we wanted them to do in terms of driving more profitable growth. That top-line does have an impact on consolidated revenue. It's just math. The premise that the guidance was to really help both the Q4 and the full years do the math for you guys and give you a view of where we see things are playing out. Like I said, there's a lot of optimism in regards to where we are from a product roadmap and a commercialization perspective. The CRE market is fine. We are seeing positive signs of activity. Asset values have seen double-digit gains across all major sectors on an annual basis in Q3. Cost and availability and capital continue to improve.
Speaker #2: We did get things that were , I would say , pretty good when it came to the standpoint of valuations . But to be honest , as we looked at our framework and how we were evaluating that and how we would execute going forward and what the team believed , we felt that there was more value that we could drive for our shareholders .
Your next question comes from the line of Paul Treiber with RBC. Please go ahead.
Oh, Thanks very much good afternoon, just a couple of questions for Mike just on the value creation plan.
That you mentioned.
You said that you wanted to ever want to be aligned.
Speaker #2: And , you know , as we sat down as a board , it became evident that we knew what that execution plan would be .
Got a plan that the go forward value creation plan does that differ from what the company has a message to investors over the last couple of years.
Speaker #2: We knew how that we would take advantage of Argus intelligence as pub has said , and how we were going to start to really think about the business as we were going to accelerate .
Hey, Paul no not necessarily.
Speaker #2: So we move forward with the game plan as we did , and we know what we are marching towards over the next 3 to 5 years .
I would say is that I think we're looking at an acceleration of that plant.
Think that as we have gone through things over the last couple of years.
We have been and to be fair. The team has been working very methodically on trying to change the business and really get it started and be focused towards being more of the software and data and analytics business, which in a lot of ways is a pretty good side of lift and I think if we are looking forward when I get back to the alignment is now that we feel like we have the piece.
Speaker #7: Okay . Thank you . I will pass the line .
Speaker #4: Your next question comes from the line of Paul Traber with RBC . Please go ahead .
Pavan Bhalla: As I said, dovetails into an easing monetary policy. Pick your report, but as a Q3 pre-quit, it is estimating that the dry powder for commercial real estate stands at approximately $395 billion globally. We are seeing transaction volume starting to trend in the right direction, albeit still down, low single digit year over year. It is up on a sequential basis. As the market continues to signal price stability and we are seeing favorable rate trajectories, these all position us well to accelerate the market adoption of our new product innovation. We're really excited about 2026 and finishing the year off strong.
Speaker #8: Thanks very much . Good afternoon . Just a couple questions for for Mike . Just on the the value creation plan that you mentioned .
And parts now it's going to be adding those in faster. So that we can get a faster growing so as we look at things like on where do we want to continue to invest in growth.
Speaker #8: You said that you wanted everyone to be aligned . Is that plan that the go forward value creation plan , does that differ from what the company has messaged to investors over the last couple of years ?
We have a good perspective on that.
As Bob said, we are looking to really look at how we can increase profitability.
Speaker #2: Hey , Paul , no , not necessarily . What I would say is that I think we're looking at an acceleration of that plan .
And we've been doing that consistently but we think that we have we feel like we can really work on that as well and then when I look at things in just execution plan.
Speaker #2: I think that as we have gone through things over the last couple of years , we have been and to be fair , the team has been working very methodically on trying to change the business and really get it started and be focused towards being more of that software and that data and analytics business , which in a lot of ways is a pretty good size lift .
Just really putting yourself out there in a couple of years working yourself backward per quarter to see how youre going to really get customers value and how they are going to adopt our products and we've been really talking about that and trying to create a value prop like quantitative value prop for our customers and our customers are seeing what that can be so I think from our view that to be.
Aaron Kyle: Okay, that's helpful color on the guidance. Maybe if I can just follow up with another question on the strategic review and the conclusion there. You mentioned it was wide-ranging and considering several options, including the solicitation of offers. To the extent that you can comment, were valuations that you were seeing throughout the process in line with what you would have expected? Yeah, anything you can add there for additional color would be great.
Speaker #2: And I think as we are looking forward when I get back to the alignment , is now that we feel like we have the pieces and parts , now , it's going to be adding those in faster so that we can get a faster groove .
Alignment that you get to it's not an alignment of persons thought processes, but it's more on power.
Speaker #2: So as we look at things like on where do we want to continue to invest and grow , that's we have a good perspective on that as Putman said , we are looking to really look at how we can increase profitability , and we've been doing that consistently , but we think that we have a we we feel like we can really work on that as well .
We're going to execute.
Okay. That's helpful. And then second question just on the strategic review does the board see possible divestitures.
Mike Gordon: Yeah, sure. I mean, as I said, I think that with the review that we did, we looked internally and looked externally, and we also tried to look at many different options there. We did get things that were, I would say, pretty good when it came to the standpoint of valuations. To be honest, as we looked at our framework and how we were evaluating that and how we would execute going forward and what the team believed, we felt that there was more value that we could drive for our shareholders. As we sat down as a board, it became evident that we knew what that execution plan would be. We knew how we would take advantage of ARGUS Intelligence, as Pawan has said, and how we were going to start to really think about the business as we're going to accelerate.
And or acquisitions as part of our value, creating strategies going forward here.
Speaker #2: And then that when I look at things in just execution plans , it's just really putting yourself out there in a couple of years , working yourself backward for a quarter to see how you're going to really get customers value and how they're going to adopt our products .
Good question I would say.
So the answer on the divestitures is we're always looking at that and we will talk about that on November 20th.
And in the Investor Day, and then I would say that we're going to be focusing on driving value back to our shareholders in the near term, we think that we have the pieces in pieces and parts in place.
Speaker #2: And we've been really talking about that and trying to create a value prop like a quantitative value prop for our customers . And our customers are seeing what that could be .
Speaker #2: So I think from our view , that's the alignment that you get to . It's not an alignment of persons thought processes , but it's more on how we're going to .
If there is something.
That is that is it out there that becomes interesting to us as we've done in the past we will consider it but right now we really think that we're going to be focusing on driving the value back to our customers and that in the short and medium term.
Speaker #2: execute
Speaker #8: Okay . That's helpful . And the second question just on the strategic review , does the board see possible divestitures and or acquisitions as part of a value creating strategies going forward ?
Mike Gordon: We moved forward with the game plan as we did, and we know what we are marching towards over the next three to five years.
Okay, I'm sorry for the investors.
Yes.
Aaron Kyle: Okay, thank you. I will pass the line.
Speaker #8: Here
Again, if you would like to ask a question press star one on your telephone keypad.
Speaker #2: Good question . I would say so . The answer ? on the divestitures is we're always looking at that . And we will talk about that on November 20th .
Operator: Your next question comes from the line of Paul Traber with RBC. Please go ahead.
Your next question comes from Richard Tse with National Bank Capital markets. Please go ahead.
Gavin Fairweather: Thanks very much. Good afternoon. Just a couple of questions for Mike. Just on the value creation plan that you mentioned, you said that you wanted everyone to be aligned. Is that plan, the go-forward value creation plan, does that differ from what the company has messaged to investors over the last couple of years?
Yes. Thank you welcome back Mike.
Speaker #2: And at the Investor Day . And then I would say that we're going to be focusing on driving value back to our shareholders in the nearer term .
I had a question also on the strategic review you said that you had some inbounds that were pretty good.
What valuation.
Speaker #2: We think that we have the pieces in pieces and parts in place . You know , certainly if there's something that that is out there that becomes interesting to us , as we've done in the past , we'll consider it .
Would you consider or would you have considered pursuing those strategic options.
That's something that is between us and the board.
Mike Gordon: Hey, Paul. No, not necessarily. What I would say is that I think we're looking at an acceleration of that plan. I think that as we have gone through things over the last couple of years, we have been, I mean, and to be fair, the team has been working very methodically on trying to change the business and really get it started and be focused towards being more of that software, that data, and analytics business, which in a lot of ways is a pretty good size lift. I think as we are looking forward, when I get back to the alignment, is now that we feel like we have the pieces and parts, now it's going to be adding those in faster so that we can get a faster groove.
We looked at we looked at a variety of things and as we were walking through.
Speaker #2: But right now we really think that we're going to be focusing on driving the value back to our customers in the short and medium term .
What we were seeing from the market.
Speaker #2: Okay , thanks for taking the questions .
We're very happy.
<unk> made a lot of.
Speaker #8: Yeah .
Time to take a look at us and we've spent time with them, but again at the end of the day, we felt like we could drive a lot more value for our shareholders in a short term and the medium term consequence, so thats, how we just went through it.
Speaker #4: Again , if you would like to ask a question , press star one on your telephone keypad . Your next question comes from Richard Si with National Bank Capital Markets .
Speaker #4: Please go ahead .
Speaker #9: Yes . Thank you . Welcome back . Mike , I had a question also on the review . You said that you had some inbounds that were pretty good at what valuation would you consider or would you have considered pursuing those strategic options ?
Okay fair enough.
And then as you come into the job here early next year.
Is it fair to sort of ask you.
Mike Gordon: As we look at things like where do we want to continue to invest and grow, we have a good perspective on that. As Pawan said, we are looking to really look at how we can increase profitability. We've been doing that consistently, but we think that we feel like we can really work on that as well. When I look at things in just execution plans, it's just really putting yourself out there in a couple of years and working yourself backward per quarter to see how you're going to really get customers' value and how they're going to adopt our products. We've been really talking about that and trying to create a quantitative value prop for our customers. Our customers are seeing what that could be. I think from our view, that's the alignment that you get to.
What your top one or two offering issues are going to be in terms of priorities for 2026.
Should we wait until you are actually in that job because I think it's fair. It's early so I appreciate you've just giving you right down to it.
Speaker #2: You know , that's something that , you know is between us and the board . We looked at we looked at a variety
The.
Speaker #2: of things . And as we were walking through what strategic we were seeing from the market , we're very happy at like how people made a lot of time to take a look at us and we spend time with them .
I would tell you the following when I look at just.
Our execution and how we can accelerate that execution, that's really what I want to get down to on this.
In talking to the team and talking to the board it's been a focus for all of us so far.
Speaker #2: But again , at the end of the day , we felt like we can drive a lot more value for our shareholders in a short term .
Again, one of the reasons why.
Speaker #2: And medium term consequence . So that's how we just went through it .
We look strategically at our options.
Speaker #9: Okay . Fair enough . And then as you come into the job here early next year , is it fair to sort of ask you what your top 1 or 2 operating initiatives are going to be in terms of priorities for 2026 , or should we wait till you're actually in that job ?
So think of US as we look through this and tumor poverty in his talk we have a lot of opportunity to really continue to get good growth.
Mike Gordon: It's not an alignment of person's thought processes, but it's more on how are we going to execute.
With our core franchises, and we really want to accelerate that growth as well as to accelerate the profitability. So I think as we go on.
Gavin Fairweather: Okay, that's helpful. Second question, just on the strategic review, does the board see possible divestitures and/or acquisitions as part of the value-creating strategies going forward here?
This what I would call it March with the team.
Speaker #2: I think it's fair . It's early , so I appreciate you just getting right down to it . The the I would tell you the following .
We think that that is we're really going to lineup to this so that we can do.
Do you want to.
Gary.
Speaker #2: When I look at just our execution and how we can accelerate that execution , that's really what I want to get down to on this .
Good and strong growing software company.
Mike Gordon: Good question. I would say the answer on the divestitures is we're always looking at that. We will talk about that on 20 November 2024 in investor day. I would say that we're going to be focusing on driving value back to our shareholders in the nearer term. We think that we have the pieces and parts in place. Certainly, if there's something that is out there that becomes interesting to us, as we've done in the past, we'll consider it. Right now, we really think that we're going to be focusing on driving the value back to our customers in the short and medium term.
Okay, great. Thank you.
Yeah.
Speaker #2: I , in talking to the team and talking to the board , it's been a focus for all of us so far . And that's again , one of the reasons why we we look strategically at our options .
Your next question comes from the line of Kevin Krishna Rodney with Scotiabank. Please go ahead.
Hey, there good evening. Thanks for taking my question I've, just got one I think you mentioned that your 56% of the way through the the Argus intelligence.
Speaker #2: I think also we look through this and we're in this talk , we have a lot of opportunity to really continue to get the good growth with our franchises , and we really want to accelerate that growth as well as accelerate the profitability .
Migrations I'm wondering if you can comment on adoption of the various Ah different packages there the core Ah Ah portfolio and benchmark.
Speaker #2: So I think as we go on this , what I would call March with the team , we think that that it's we're really going to line up to this so that we can be a very good and strong growing software company .
Wondering if you can give any update on how those are trending are they within your expectations and let me I'll follow up after that.
Gavin Fairweather: Okay. Interesting.
Mike Gordon: I'm sorry, our investors.
Gavin Fairweather: Yeah.
Yeah, Kevin Great question, maybe I'll start the answer and then I'll hand, it over to rich <unk>, who heads that up so.
Operator: Again, if you would like to ask a question, press star one on your telephone keypad. Your next question comes from Richard C with National Bank Capital Markets. Please go ahead.
Speaker #9: Okay . Great . Thank you . I'll pass the line .
As you know.
Thanks, Mark manager portfolio manager.
Speaker #4: Your next question comes from the line of Kévin Kirshner with Scotiabank . Please go ahead .
Richard C: Yes, thank you. Welcome back, Mike. I had a question also on the strategic review. You said that you had some inbounds that were pretty good. At what valuation would you consider or would you have considered pursuing those strategic options?
<unk> add on that that will definitely brought onboard with Argus intelligence, we just recently launched it.
Speaker #10: Hey there . Good evening . Thanks for taking the question . I've just got one .
We're seeing a very healthy pipeline, we expect.
Speaker #10: I think you mentioned that your your as 56% of the way through the The Argus intelligence migrations . I'm wondering if you can comment on adoption of the various different packages .
Yeah.
Fair number of clients should be closed by the end of the year. In addition to the clients that we have today.
The first generation of benchmark Badger was designed with invoicing the customer in mind, where we literally have the lead product manager stand on VNS quarterly reviews with clients.
Mike Gordon: That's something that is between us and the board. We looked at a variety of things. As we were walking through what we were seeing from the market, we're very happy at how people made a lot of time to take a look at us, and we spent time with them. Again, at the end of the day, we felt like we can drive a lot more value for our shareholders in a short-term and a medium-term consequence. That's how we just went through it.
Speaker #10: There's the the core portfolio and benchmark . I'm wondering if you can give any update on how those are trending . Are they within your expectations and maybe I'll follow up after that .
To be able to create a scenario that could mimic the benchmark analysis that we provide clients.
Through that Dms processes, we're also leveraging that technology internally.
Speaker #3: Yeah . Kevin great question . Maybe I'll start the answer and then I'll hand it over to Richard Sarkis . Who heads that up .
Guidance for the past in terms of project, one where we're just driving greater efficiencies within our business and using.
Speaker #3: So you know , as you know , benchmark manager , portfolio manager big add on that that that we brought on board with Argus Intelligence .
And the biggest customer of our own products easing that innovation that comes out of our own use.
Richard C: Okay. Fair enough. As you come into the job here early next year, is it fair to sort of ask you what your top one or two operating initiatives are going to be in terms of priorities for 2026, or should we wait till you're actually in that job?
Speaker #3: We just recently launched it . We're seeing a very healthy pipeline . We expect , you know , a fair number of clients to be closed by the end of the year .
And that to the marketplace.
Look in order for clients to have access to benchmark manager and we've mentioned this in the past they do have to move their models to the platform scenarios. Some work that the client has to do but we are leveraging our own automation capabilities through the altice IV and Rihanna on the IV.
Speaker #3: In addition to the clients that we have today . You know , the first iteration of Benchmark Manager was designed with the voice of the customer in mind , where we literally had the lead product manager sit on VMs quarterly reviews with clients to be able to create a scenario that could mimic the benchmark analysis that we provide clients through , that VMs process .
Mike Gordon: I think it's fair. It's early, so I appreciate you just getting right down to it. I would tell you the following. When I look at just our execution and how we can accelerate that execution, that's really what I want to get down to on this. In talking to the team and talking to the board, it's been a focus for all of us so far. That's, again, one of the reasons why we look strategically at our options. I also think as we look through this and to where Pavan has talked, we have a lot of opportunity to really continue to get the good growth with our core franchises. We really want to accelerate that growth as well as accelerate the profitability. I think as we go on this, what I would call, March with the team, we think that.
And to help facilitate that.
Part of the continued involvement of the product we are adding more.
And in more cities active to the D&O.
Extending the property subtypes, we just had a larger lease recently and we continue to add more properties steps subtypes that punch line candidates. We're iterating fast based on at a kind of a full circle of continual feedback loop.
Speaker #3: We're also leveraging that technology internally . As you guys heard in the past , in terms of project one , where we're just driving greater efficiency within our business and using as the biggest customer of our own product , using that innovation that comes out of our own use to bring that to the marketplace .
Our early clients to continue to evolve the product and so on.
So that gives us a lot of upside in the sense that gum.
Speaker #3: Look , in order for clients to have access to benchmark Manager , and we've mentioned this in the past , they do have to move their models to the platform .
Our sales team has a great opportunity to stay engaged with clients and continuing to build the pipeline not only as they migrate to Argus intelligence, but now the opportunity to follow that on.
Speaker #3: So there is some work that the client has to do . But we are leveraging our own automation capabilities through the Altus ID and ID to help facilitate that .
Mike Gordon: We're really going to line up to this so that we can be a very good and strong-growing software company.
With what the add ons that we're continuing to bring more and more to that platform and so that gives us a pretty long runway in terms of opportunity and growth.
Speaker #3: You know , as part of the continuing involvement of the product , we are adding more MSAs and more cities to to the view .
Richard C: Okay. Great. Thank you. I'll pass the line.
Speaker #3: We're expanding the property subtypes . We just had a large release recently , and we continue to add more properties to subtypes . But Punchline Kevin , is we're we're iterating fast based on a kind of a full circle of continual feedback loop from our early clients that continue to evolve the product .
From a new logo perspective, but also from that from a price volume perspective as lab to Ed Fritsch.
Operator: Your next question comes from the line of Kevin Krishnaradne with Scotiabank. Please go ahead.
I think you've covered that really well I think the two points.
Mike Gordon: Hey there. Good evening. Thanks for taking the question. I've just got one. I think you mentioned that you're 56% on the way through the ARGUS Intelligence migrations. I'm wondering if you can comment on adoption of the various different packages. There's the core, Portfolio, and Benchmark Manager. I'm wondering if you can give any update on how those are trending. Are they within your expectations? Maybe I'll follow up after that.
Underscore our won the rapid pace of iteration right real modern software development and not integration done in a vacuum buses with both the internal and external voice of the customer obviously with our several hundred Vms practitioners, providing us that voice of the market internally, but also spending a lot of time.
Speaker #3: And so so that gives us a lot of upside in the sense that , you know , our sales team has a great opportunity to stay engaged with clients and continue to build a pipeline not only as they migrate to Argus Intelligence , but now the opportunity to follow that on with , with , with the add ons that we're continuing to bring more and more to the platform .
Customers, who have the core of our risk intelligence product previewing portfolio and best Park manager with them and getting that feedback that has informed our roadmap.
Operator: Yeah. Kevin, great question. Maybe I'll start the answer, then I'll hand it over to Rich Sarkis who heads that up. As you know, Benchmark Manager, Portfolio Manager, a big add-on that we brought on board with ARGUS Intelligence. We just recently launched it. We're seeing a very healthy pipeline. We expect a fair number of clients to be closed by the end of the year, in addition to the clients that we have today. The first iteration of Benchmark Manager was designed with the voice and the customer in mind, where we literally have the lead product manager sit on VMS quarterly reviews with clients to be able to create a scenario that can mimic the benchmark analysis that we provide clients through that VMS process.
Second piece is really around thinking about the core Argos intelligence product that as Tom had mentioned as having really strong traction as the launching pad for future upsell and cross sells for portfolio and benchmark manager both of which would require a move to asset based pricing. So I think we're just really starting to scratch the surface.
Speaker #3: And so that gives us a pretty long runway in terms of opportunity and growth , both from a new logo perspective , but also from from a price volume perspective as well , to that , Rich , I don't .
Speaker #2: Yeah , I think you covered that really well . I think the two points I underscore .
Speaker #11: Are one , the rapid pace of iteration . Right . Real modern software development and not iteration done in a vacuum . This is with both the internal and external voice of the customer .
Around that asset based pricing uptick as well.
86 and beyond.
Thanks for that very comprehensive answer I'm wondering what do you think that.
Speaker #11: Obviously with our several hundred VMs practitioners providing us that voice of the market internally , but also spending a lot of time with customers who have the core intelligence product reviewing portfolio and benchmark manager with them and getting that feedback that has informed our roadmap .
Manager as it is.
It's something that will be valuable to both of your largest customers in the smallest of that or is it something that might only be adopted by a large I'm just trying to understand where you think you know what type of customers might be the best suited for the product or is it kind of something that you think over time can be beneficial to the big large and small.
Operator: We're also leveraging that technology internally, as you guys heard in the past, in terms of project one, where we're just driving greater efficiency within our business. As the biggest customer of our own product, using that innovation that comes out of our own use to bring that to the marketplace. Look, in order for clients to have access to Benchmark Manager, and we've mentioned this in the past, they do have to move their models to the platforms. There is some work that the client has to do. We are leveraging our own automation capabilities through the Altus ID and Reonomy ID to help facilitate that. As part of the continuing involvement of the product, we are adding more MSAs and more cities to the view. We're expanding the property subtypes. We just had a large release recently, and we continue to add more property subtypes.
Speaker #11: And the second piece is really around thinking about the core Argus intelligence product that has been mentioned as having really strong traction as the launching pad for future upsells and cross-sells for portfolio and benchmark manager , both of which would require a move to asset based pricing .
That's a great question and I think the answer is both.
For the larger ones. This is a great complement to some of the benchmark I guess is that they are currently getting.
From our BMS colleagues on a quarterly basis with benchmark manager that really brings it to life and then allows the fees for a period inspection and diving into the best market trends, which really brings those benchmarking reports for life.
Speaker #11: So I think we're just really starting to scratch the surface around that asset based pricing uptake as well . In 26 and beyond .
Speaker #10: And do you think for us , very comprehensive answer . I'm wondering , do you think that the benchmark manager , is it is it something that will be valuable to both your largest customers and the smallest ?
For the smaller and medium ones, there's almost like a democratization of benchmarking where now it is available for those who have perhaps a smaller portfolio of different types of assets and different pricing models.
Speaker #10: Is it or is it something that might only be adopted by large ? I'm just trying to understand where you think you know , what type of customers might be the best suited for the product , or is it kind of something that you think over time can be beneficial to , to big , large and small ?
They are looking for the benchmark manager software really on logs capability for them.
As previously they might have been sort of not able to get that type of capability.
Operator: Punchline, Kevin, is we're iterating fast based on a kind of a full circle of continual feedback loop from our early clients that continue to evolve the product. That gives us a lot of upside in the sense that our sales team has a great opportunity to stay engaged with clients and continue to build the pipeline, not only as they, one, migrate to ARGUS Intelligence, but now the opportunity to follow that on with the add-ons that we're continuing to bring more and more to the platform. That gives us a pretty long runway in terms of opportunity and growth, both from a new logo perspective, but also from a price volume perspective as well, too. Rich, I don't have.
Speaker #11: That's a great question . And I think the answer is both for the larger ones . This is a great compliment to some of the benchmark insights that they are currently getting from our VMs colleagues on a quarterly basis , with Benchmark Manager .
Thank you.
Yeah.
There are no further questions at this time I will now turn the call back over to Pablo <unk> for closing remarks.
Speaker #11: That really brings it to life and allows that into period inspection and diving into the benchmarking trends , which really brings those benchmarking reports to life .
Yeah. Thanks again, everyone for joining us on this call. This evening and as always please don't hesitate to get in order to pass through can know Martin if you have any follow up questions with that I'll conclude the call.
Speaker #11: And for the smaller and medium ones , there's almost like a democratization of benchmarking , where now it is available for those who have perhaps a smaller portfolio or different types of assets and different pricing models that they are looking for .
And look forward to seeing everyone at Investor day.
Thank you ladies and gentlemen that concludes today's call. Thank you all for joining you may now disconnect.
Speaker #11: The benchmark manager software really unlocks that capability for them . Whereas in previously they might have been sort of not able to get that type of capability .
Mike Gordon: Yeah, I think you covered that really well. I think the two points I underscore are, one, the rapid pace of iteration, right? Real modern software development and not iteration done in a vacuum. This is with both the internal and external voice of the customer, obviously, with our several hundred VMS practitioners providing us that voice of the market internally, but also spending a lot of time with customers who have the core ARGUS Intelligence product, previewing Portfolio Manager and Benchmark Manager with them, and getting that feedback that has informed our roadmap. The second piece is really around thinking about the core ARGUS Intelligence product that, as Pawan mentioned, is having really strong traction as the launching pad for future upsells and cross-sells for Portfolio Manager and Benchmark Manager, both of which would require a move to asset-based pricing.
Speaker #10: Thank you .
Speaker #4: There are no further questions at this time. I will now turn the call back over to Pavan for closing remarks.
Speaker #3: Yes , thanks again , everyone , for joining us on this call this evening . And as always , please don't hesitate to get Ahold of us through Camila or Martin if you have any follow up questions .
Speaker #3: With that, I'll conclude the call and look forward to seeing everyone at Investor Day.
Mike Gordon: I think we're just really starting to scratch the surface around that asset-based pricing uptake as well in 2026 and beyond.
Mike Gordon: Thanks for that very comprehensive answer. I'm wondering, do you think that the Benchmark Manager, is it something that will be valuable to both your largest customers and the smallest, or is it something that might only be adopted by large? I'm just trying to understand where you think. What type of customers might be the best suited for the product, or is it kind of something that you think over time can be beneficial to big, large, and small?
Mike Gordon: That's a great question. I think the answer is both. For the larger ones, this is a great complement to some of the benchmarking insights that they are currently getting from our VMS colleagues on a quarterly basis. With Benchmark Manager, that really brings it to life and allows that intra-period inspection and diving into the benchmarking trends, which really brings those benchmarking reports to life. For the smaller and medium ones, there's almost like a democratization of benchmarking, where now it is available for those who have perhaps a smaller portfolio or different types of assets and different pricing models that they are looking for. The Benchmark Manager software really unlocks that capability for them, whereas previously, they might have been sort of not able to get that type of capability.
Mike Gordon: Thank you.
Operator: There are no further questions at this time. I will now turn the call back over to Pavan for closing remarks.
Operator: Yes, thanks again, everyone, for joining us on this call this evening. As always, please don't hesitate to get ahold of us through Camilla or Martin if you have any follow-up questions. With that, I'll conclude the call and look forward to seeing everyone at investor day.
Operator: Thank you. Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.