Payoneer Global Inc. Q4 FY2024 Earnings Call

Good morning. Thank you for standing by. Welcome to Payoneer's Fourth Quarter 2024 Earnings Conference Call. At this time, all lines have been placed on mute to prevent any background noise. Following the speakers' remarks, we will open the line for your questions. As a reminder, this conference call is being recorded. I would now like to turn the call over to Caius Slater, Payoneer's Director of Investor Relations.

Thank you, operator. With me on today's call are Payoneer's Chief Executive Officer, John Kaplan, and Payoneer's Chief Financial Officer, Bea Ordonez. Before we begin, I'd like to remind you that today's call may contain forward-looking statements which are subject to risks and uncertainties. For more information, please refer to our filings with the SEC which are available in the Investor Relations section of payoneer.com. Actual results may differ materially from any forward-looking statements we make today. These forward-looking statements speak only as of today and the company does not assume any obligation or intend to update them, except as required by law. In addition, today's call may include non-GAAP measures. These measures should be considered in addition to and not instead of GAAP financial measures. Reconciliation to the nearest GAAP measure can be found in today's earnings press release which is available on our website. Additionally, please note we have posted an earnings presentation supplement alongside our earnings press release on investor.payoneer.com. All comparisons made on today's call are on a year-over-year basis unless noted otherwise. With that, I'd like to turn the call over to John to begin.

Good morning, everyone, and thank you for joining us today. Payoneer had a standout Q4 and a record-breaking 2024. We hit new highs in volume, revenue, and profitability because we are executing with focus and precision. Our strategy to build a global financial stack for SMBs is working. Our mission is clear: to connect the world's underserved businesses to a rising global economy while delivering sustainable profitable growth and shareholder value. At our Investor Day in September 2023, we laid out a simple plan: become the leading payments and financial services provider to cross-border SMBs. We're doing exactly that, leveraging Payoneer's key strengths—our strong team, broad ecosystem, regulatory infrastructure, trusted brand, and diverse global customer base. Traditional banks underserve SMBs operating across borders, and we don't. 2024 was a breakthrough year for Payoneer. We sharpened our ICP strategy, prioritized our largest customers and AP products, and accelerated both growth and profitability. The results speak for themselves. Revenue growth, excluding interest income, accelerated from 5% in 2023 to 20% in 2024. B2B volume grew 42% year-over-year, far ahead of our initial target of 25% and significantly outpacing our 2023 performance. ARPU, excluding interest income, grew 21% year-over-year, marking six consecutive quarters of acceleration. Customer adoption of three or more AP products reached 53% of our total usage in Q4 of 2024, a 30% increase over Q1 of 2022. Card usage grew 36% year-over-year, with broad-based growth across all regions. 10K-plus ICPs grew volumes 21% year-over-year. Key product launches included the lite account, ERP integrations, and the Green Channel portal in China, helping our customers there increase their access to global demand. We expanded our financial stack with the acquisition of Skuad, positioning us to capture share in global workforce management. We were disciplined about our costs. For example, Payoneer headcount has been largely flat for two years. We delivered three consecutive quarters of positive adjusted EBITDA excluding interest income. We're scaling efficiently and profitably. Our execution is strong, and we've exceeded our September 2023 Investor Day targets. These results demonstrate our scalable, increasingly profitable model and the strength of our execution. We are in the early stages of a multiyear value creation journey. The trade technology and financial landscape is shifting, and we are in the prime position to capitalize on it. Here's where we're focused. We intend to deliver sustained growth and profitability, further refining our ICP strategy, enhancing acquisition efficiency, increasing cross-sell, improving retention, and optimizing pricing. We will continue to implement our platform modernization and expansion. We will build, buy, and partner with an ecosystem of products, simplifying our UX and advancing our regulatory infrastructure, all to provide the financial stack our customers need. We plan to close our acquisition in China. We shared a few weeks ago that we have secured the regulatory approvals required to proceed with our acquisition of a licensed payment service provider and are working towards closing in the first half of this year. We will continue to review and optimize capital allocation. We are balancing growth investments with returns to shareholders to drive long-term value. As we look ahead to our 20th anniversary this April, we are committed to unlocking the multi-trillion-dollar cross-border SMB payments opportunity. The Payoneer brand is strong, recognized, and trusted with our strong team, clear strategy, consistent results, and improving profitability. We are taking share in cross-border B2B payments and creating value for our shareholders. With that, I'll turn it over to Bea to walk you through the financial details and our 2025 guidance.

Thank you, John, and thank you to everyone for joining us. Payoneer had a record-breaking 2024. We delivered volume growth of 21%, growth in revenue excluding interest income of 20%, and generated $271 million of adjusted EBITDA, representing a 28% adjusted EBITDA margin for the year. These results are a testament to the unique value proposition we offer to our customers, SMBs and entrepreneurs looking to access the opportunities of an increasingly digital global economy. Now turning to our fourth quarter results. We delivered another quarter of record revenue at $262 million, up 17%. Growth was driven by robust performance in our marketplace business, continued strength in our B2B franchise, increased adoption of our checkout capabilities and card product, as well as the impact of our pricing and offering strategy. Volume growth of 18% reflected broad-based outperformance across our ecosystem. SMB volumes grew 18% year-over-year. Volume from SMBs that sell on marketplaces was up 14%. We grew volumes from SMBs that sell B2B by 37%. Merchant services volume continued to grow by more than 100% year-over-year. Our Q4 take rate of 116 basis points decreased 2 basis points on a year-over-year basis and 6 basis points sequentially, primarily driven by lower interest income. On a year-over-year basis, we were able to drive expansion in our SMB customer take rate reflecting the incremental value we are delivering to our customers. Our SMB customer take rate was up 9 basis points year-over-year and flat sequentially despite a seasonal mix shift towards larger e-comm sellers, driven by continued growth in our B2B franchise, the ongoing impact of our various pricing initiatives, continued adoption of our high-value products, especially our card product, as well as the impact of our workforce management acquisition. Customer funds held by Payoneer increased 9% year-over-year to $7 billion. Customers value our multicurrency capabilities and the ability to hold balances in stable currencies is a core value proposition. We continue to steadily grow customer funds and generated interest income of $61 million in Q4 even as average interest rates declined year-over-year. As described on our third-quarter call, in 2024 we implemented a number of actions to reduce our sensitivity to short-term interest rate fluctuations. As of December 31st, we had approximately $1.8 billion of assets underlying customer funds invested in a portfolio of U.S. Treasury securities and term-based deposits. The weighted average yield on this portfolio is approximately 4.4% with a weighted average duration of approximately two years. We have purchased interest rate derivatives on approximately $1.9 billion of funds underlying our customer balances, providing a floor against interest rate declines below 3%. Approximately 50% of the assets underlying customer balances are short-term, highly liquid, and thus, subject to floating rates predominantly to short-term interest rates in the U.S. We will continue to actively manage our hedging programs. Total operating expenses of $233 million increased 17%, primarily driven by labor-related expenses, higher transaction costs, consultancy fees, and the impact of seasonal cashback incentive programs designed to drive adoption of our card product. Total operating expenses included approximately $70 million of one-time and seasonal items, including adjustments to full-year bonus and benefits accruals in line with our strong 2024 performance, one-time investments in certain platform and infrastructure initiatives, and a donation to the Payoneer foundation, among other items. Transaction costs of $43 million increased 19%, broadly in line with volume growth of 18%, even as we saw a mix shift into higher transaction cost products and business lines, including our B2B merchant services and our card product. Transaction costs represented 16.5% of revenue, an increase of 30 basis points from the prior year period. Sales and marketing expense was up $7 million or 14% year-over-year, driven by higher labor-related costs including from our workforce management acquisition, increased spending on card incentives especially in China, and higher partner commissions. Other operating expenses were up $3 million or 9%, driven by higher IT and communication costs and higher consulting fees. R&D expense increased $5 million or 15%, reflecting higher labor-related costs from higher headcount which increased approximately 25% year-over-year, including from our workforce management acquisition, as well as higher bonus and employee benefit accruals in line with our 2024 performance. G&A expense increased $6 million or 23%, again primarily due to higher bonus accruals as well as certain non-recurring consulting fees and the impact of our donation to the Payoneer foundation. Adjusted EBITDA was $63 million compared to $52 million in the prior year period. This represents a 24% adjusted EBITDA margin in the quarter and is the third consecutive quarter of positive adjusted EBITDA excluding interest income. For the full year, we achieved $14 million of positive adjusted EBITDA excluding interest income versus an adjusted EBITDA loss excluding interest income of $25 million in 2023. Net income was $18 million compared to $27 million in the fourth quarter of last year. Q4 basic and diluted earnings per share were $0.05. We ended the quarter with cash and cash equivalents of $497 million. During the quarter, we purchased approximately $18 million worth of shares, and for 2024, we repurchased a total of $137 million worth of shares at a weighted average price of approximately $550 and exceeded our target of doubling our share repurchases in 2024 versus 2023. As discussed on our third-quarter call, during 2024 we also repurchased and redeemed all 25 million outstanding public warrants for $21 million. Turning now to our 2025 guidance. For full year 2025, we expect revenues to be between $1,040 million and $1,050 million. This includes $215 million of interest income and $825 million to $835 million of revenue excluding interest income. The midpoint of our guidance implies 15% growth in revenue excluding interest income, in line with the medium-term targets we shared at our Investor Day in late 2023. We expect revenue excluding interest income to grow at a faster rate than volume in line with our stated strategy to expand ARPU from faster growth in our higher yielding B2B business and ongoing penetration of high yield products like our card offering as well as from the continued rollout of our pricing and offering strategy. We expect to generate $215 million of interest income for the year, based on probability-weighted market interest rate expectations, our expectations for balance growth, and the impact of our investment program. We expect transaction costs as a percentage of revenue to be approximately 18%, up from 15.6% in 2024 from the impact of declining interest rates and in line with ongoing growth in our higher cost B2B checkout and card offerings. We expect 2025 adjusted OpEx less transaction costs of approximately $595 million, which represents 7% growth over 2024. Adjusted OpEx represents our guidance for revenue less adjusted EBITDA. We expect adjusted EBITDA to be between $255 million and $265 million, representing an adjusted EBITDA margin of approximately 25% at the midpoint, again in line with the medium-term targets we set at our 2023 Investor Day. When excluding interest income, our guidance implies adjusted EBITDA of between $40 million and $50 million, over three times higher than in 2024 and showing increasing profitability in our core business. Our 2024 results reflect strong momentum across our business and demonstrate the size of our opportunity and the strength of our execution. We delivered meaningful growth in our B2B business, demonstrating strong product-market fit with service-oriented SMBs in emerging markets. We grew ICPs, and the volume from our larger ICPs delivered increased ARPU and generated positive adjusted EBITDA excluding interest income. We remain committed to driving innovation and delivering long-term value for our customers, our shareholders, and our employees. We are now happy to answer any questions you may have. Operator, please open the line.

Thank you. We will now begin the question-and-answer session. Our first question comes from Sanjay Sakhrani with KBW. Please go ahead.

Thank you. Good morning. I was wondering if you could discuss the macro assumptions that inform your perspectives. Could you elaborate on what you've considered and the potential upside and downside scenarios within the guidance? Thanks.

Hey, Sanjay. It's Bea. Nice to hear from you. So, look in terms of our guidance philosophy, there's been no change there. Our guidance reflects how we expect the business to perform, the environment in which we operate, models and assumptions that are anchored to those key metrics that we're seeing in our business, as well as how we expect marketplaces and other parts of the ecosystem to perform. So, we're not looking to be conservative. We feel our guidance is pragmatic, appropriate, and consistent. We talked in our prepared remarks around the assumptions there. The main assumptions really are around marketplace volume and B2B volume, as well as take rate dynamics which we're happy to dive into. But on that marketplace volume, we assume in our guidance that those growth rates normalize to high single digits from the mid-teens that we saw in 2024. And we assume that B2B growth continues to come in at about 25%. That steps down off of the record year in 2024, but is consistent with the dynamics we're seeing in our business right now. And so, look, taken together in the aggregate, that all points to volume growth for our SMB business and in general, in that low double-digit range. And as we said again in our prepared remarks, we expect revenue to grow faster than volume based on take rate dynamics that we are seeing within our business, a modest take rate expansion. And that all gets us to that revenue guide. Right? We're coming off of a record year, as we've said. We have really good momentum. We're hitting those medium-term targets that we said in late 2023, and we feel confident about our guide with all of the assumptions baked in.

Thank you, Bea. I'd like to follow up on the discussion about tariffs and the situation with China. Is there anything you have considered regarding global tariff discussions? Also, regarding the take rate, which you mentioned is a key strategic focus, what opportunities do you see for ARPU optimization as we move forward? Can you share what stage we are in with this and discuss the execution plans for 2025? Thank you.

Sure. I’m happy to address that. Let’s start with the take rate question. We feel very positive about our ability to increase the take rate in our SMB business, excluding interest income. This is something we've monitored and discussed throughout 2024. We saw a growth of 4 basis points in Q1, 1 basis point in Q2, 2 in Q3, and in Q4, we achieved a 9 basis point increase in take rate. Notably, we remained flat quarter-over-quarter, which is usually where we expect a decline. This indicates a solid expansion in take rate, which aligns with our overall growth strategy. For 2025, we anticipate our SMB customer take rate will continue to see modest expansion, which we define as being in the range of 1 to 3 basis points. The key factors contributing to this are consistent with our previous discussions. First, we plan to drive accelerated growth in our B2B sector compared to our core marketplace business, which has a take rate approximately 1.5 times higher. Additionally, we plan to cross-sell our higher value products, such as card and checkout, where we achieved record performance with a 36% increase in card usage. We will also continue implementing our financial stack strategy, including selling our checkout capabilities following our workforce management acquisition. Finally, we are refining our pricing strategy, which has been an ongoing journey for us, and we see continued potential there. Overall, these factors give us strong confidence in our strategy and our ability to increase take rate as we progress through 2025. Regarding trade policy and tariffs, we have discussed our guidance finance philosophy and the assumptions that inform it, but I won’t provide explicit assumptions regarding trade policy impacts. There is a wide range of potential outcomes, and the situation continues to evolve rapidly. Historically, our diversified business—spanning various geographies, trade routes, goods, and services—has proven resilient against similar trade policy challenges. For instance, 80% of our B2B business consists of services. Given this broad range, we are closely monitoring the situation over the medium to long term, and we believe it may actually present opportunities. In the near term, we will continue to analyze the situation, and we don't expect any significant impact on our business in most moderate tariff scenarios, which aligns with the expectations of most observers, despite the inherent uncertainties. This captures our long-term perspective on the matter.

Thank you.

Hi. Thanks for the question. Wanted to ask about revenue ex-interest income. Obviously, we exited the year at a really healthy 26% year-over-year clip. And I know you're expecting a bit of a step down in '25 to 15%. So, maybe you could talk about some of the drivers of that deceleration. I know, Bea, you just talked about marketplace and B2B volumes, but anything beyond that. And then any comments on the cadence of that deceleration through the year? Should it be a steady deceleration or any sort of step functions in any of the quarters or other timing issues to call out?

Thank you for the question, Nate, and welcome. We're currently projecting a 15% year-over-year core revenue growth, which is a decrease from the record year we had in '24. As you may know, much of our outperformance last year was due to strong results in our B2B business and unexpected higher volumes in our marketplaces. A year ago, we anticipated high single-digit growth in our marketplace segment, especially with discussions about a recession in 2024. However, our marketplaces delivered about 15% volume growth, which significantly boosted our results. We also saw encouraging growth acceleration in our B2B business, and looking ahead to 2025, we expect a return to high single-digit growth in e-commerce marketplaces. This aligns with what we've observed toward the end of '24 and into January and February. We believe this represents a return to expected longer-term growth trends. We're also confident about achieving 25% volume growth in our B2B segment. Although it's a slight decrease, the tougher comparisons and growing baseline make this reasonable. Combining these factors, we anticipate low double-digit volume growth overall for 2025, which reflects our expectations for greater revenue growth in relation to that volume due to the effects of take rates we've discussed. Regarding quarterly expectations, we aren’t anticipating a significant ramp-up in the latter half of the year—rather, we foresee mid-teens growth in Q1 and Q2, with modest increases of one or two percentage points. We believe we don’t need a dramatic acceleration to reach our targets and are comfortable with mid-teens growth in the first half and slight seasonal acceleration in the second half.

That's really great detail and I think you used the word pragmatic to describe the guide earlier, so it's good to hear that. So, for the follow-up, it was nice to see a return to some sequential growth in that cohort of ICPs doing greater than $10,000 per month. And I know you've been focused more on growing volume per ICP, but I think it would be great to hear how you're thinking about the pace of ICP adds in '25, maybe across both the size buckets and by region, and then similarly how you're thinking about growing that volume per ICP, capturing more share of wallet, et cetera.

That's a great question, and I'll address that. First, let me provide some context. In 2023, we generated $585 million in normalized revenue, excluding one-time fees, while our core business experienced a loss of around $20 million. For 2025, we anticipate revenue of $830 million and approximately $40 million in core EBITDA. Reflecting on our 5% growth in September 2023 and achieving 20% growth in 2024 highlights the exceptional execution by our team and favorable macro conditions that have supported our business. Our strategy for 2025 focuses on executing and optimizing the controllable elements of our business while leveraging macro trends that work to our advantage. Specifically regarding the ICP framework, we introduced ICPs to clarify the significant contribution of our largest customers to our overall volume and revenue, along with their need for comprehensive financial solutions as they face multi-currency and multi-geography challenges globally. Our growth equation is based on ICP multiplied by ARPU, minus the cost to serve. We are set to unlock leverage in 2025 with a projected fourfold increase in core adjusted EBITDA. We are enhancing ARPU growth through our large customers while also acquiring increasingly larger ICPs. Although we have not yet shared net revenue retention metrics for customer cohorts, the largest ICPs in the segment show the best logo, volume, and revenue retention. We are directing our resources toward profitable growth rather than simply tracking ICP metrics, which is crucial to understand. In terms of ARPU growth, we've seen a 36% increase in card products, over 100% growth in our checkout services, and a 42% rise in B2B growth. Back in 2023, we guided toward a 25% growth after coming off lower single-digit growth, and our team performed exceptionally well. We feel confident as a growth company approaching over $1 billion in revenue. Moving into 2025, we expect to continue acquiring more high-value, larger ICPs, due to the exceptional success of Adam Cohen and our go-to-market team. Oren Ryngler and our product organization are streamlining customer onboarding at scale, allowing us to expand without proportionately increasing headcount or costs. Overall, we are encouraged by the trajectory of the business and the vast opportunities available amidst the competitive environment, particularly our proven ability to attract and monetize ICPs. Furthermore, the supplement we shared reveals that growth rates of ICPs in our highest take rate regions are outpacing the rest of the company. We are fully aligned in our efforts to promote profitable growth and enhance shareholder value.

John, Bea, appreciate the detailed answers. Thanks.

Thanks, Nate.

Good morning, everyone. Congratulations on finishing the year strongly. I wanted to discuss the B2B dynamics you're observing in the first quarter and your expectations for the full year. I understand that the outlook is set at 25%, which you've been clear about since Investor Day as the long-term expectation. Can you elaborate on what it would take to achieve further growth beyond that 25% level? Will you reach similar levels of large numbers this year, or do you see opportunities for continued outperformance as we progress through 2025?

Thank you for your question, Will. We have indeed surpassed $10 billion in B2B volume in 2024, which is a remarkable accomplishment for our team, and we take pride in the momentum and traction we’ve gained. The percentage of our volume growth from B2B continues to rise, which is crucial for long-term shareholder consideration because it enhances the overall financial strength of our business. The B2B opportunity is substantial; we have made significant inroads in this sector. Our team is committed to acquiring and serving customers at full speed. We aim to exceed expectations because our business is diversified across various global regions—such as APAC, Latin America, China, and Europe—where customers require the multicurrency solutions we offer. Notably, in terms of regional growth, we observed that around 80% of our growth in Latin America came from B2B, while in EMEA, it was 88%, and in APAC, it was 37%. Our B2B franchise is making significant inroads in these markets. Small and medium businesses, especially multi-entity ones, are often underserved by their local banks, and we are providing them with a much better solution. I see further opportunities for us to capture more of this market, especially as we integrate our workforce management product and explore cross-sell potential.

Got it. That's very helpful. Could you provide some insights into the acquisition process in Mainland China? I'd like any updates or additional thoughts compared to what you shared earlier regarding the opportunities there. I know there have been significant share gains even before this acquisition in the Chinese corridor. I'm curious about your perspective on the competitive landscape in this area and what advantages this deal could bring.

We recently announced the deal and confirmed that we have received all necessary regulatory approvals, allowing us to proceed with closing in the first half. The benefits we expect from this transaction are clear. We are regulated and trusted by governments worldwide, which is crucial for offering a global solution to small and medium-sized businesses. We will be among a select few NASDAQ-listed companies with this advantage, and we take it seriously. I will be visiting China in a couple of weeks and am eager to meet our customers there. This presents a significant opportunity to capture more market share in China, as our solutions outshine those of local competitors. Our global network and Green Channel initiatives will help our customers expand their distribution across various regions. Regarding the acquisition, we see chances to enhance outbound money flows and establish on-the-ground operations supported by technology and research and development. This will speed up our product development and improve our cost structure. We've discussed in the past our commitment to expanding our regulatory footprint, which creates a strong competitive edge for the Payoneer brand and benefits our shareholders.

Yeah. Now that's certainly differentiated in the payment space. I appreciate you taking the question.

You bet.

Cool.

Yeah. Good morning. Thanks for taking the questions. It's good to see the continued progress in core EBITDA. Is there any way to think about the long-term margin for that metric? I think guidance calls for about 5% in 2025.

Thank you for your question, Cris. I'm glad to hear from you. We're very proud of the leverage we've achieved in our business, which is contributing to increased profitability in our core operations. To provide some context, in 2023, our core business experienced a loss of $25 million. However, with interest rates now declining, we are projecting to deliver over $40 million in adjusted EBITDA at the midpoint for 2025, which is three times more than last year's performance. Despite shifting our business to different geographies, adding regulatory and licensed infrastructure, which adds complexity but strengthens our position, and expanding our product offerings, we've managed to operate more efficiently and enhance profitability. We believe we can maintain this trajectory. We set a goal of 25% adjusted EBITDA back in 2023, regardless of interest rate fluctuations, and we are confident in reaching that target in 2025. We see this as a solid long-term objective, with potential for further upside. As we focus on our platform investments and leverage AI and innovations in our customer journey functions, we believe we can unlock additional efficiencies over time. For now, we are very comfortable with the 25% target and expect to achieve it in 2025.

Great. Thanks for that. And John, you alluded to it earlier and I think last quarter you talked about those ICPs generating over $250,000 of monthly volume. Can you just give any additional color on that cohort and what that looks like?

Yeah. They're fantastic, and they're happy with our product. And it's exciting to serve them because when you meet with them, what you see is these are real-scale businesses underserved by the traditional banking system. And so, as I mentioned, we see great net revenue retention with them, strong logo retention with them, and our go-to-market team is being very effective at identifying high-value customers. So, whether it's marketing services companies in Dubai or business process outsourcers in the Philippines or iPhone case exporters and traders coming out of China, it's pretty exciting to see the Payoneer global brand, a strong regulatory framework serving an upmarket cohort of customers very effectively.

Got it. Thanks for taking the questions.

Thanks, Cris.

Hi, this is Spencer James on for Trevor Williams. Thank you for taking the question. I wanted to ask maybe a follow-up to Sanjay's earlier question on tariff risk to Payoneer and maybe put a finer point specifically around efforts to close the de minimis loophole for goods shipped to the US. I was wondering if you could maybe comment on how you expect the impact of this rule to affect different sellers across your base for it to go into effect.

I appreciate the question. We can confidently assert that the de minimis rule is not significantly affecting us. We estimate that less than 3% of our volume falls under that exception. While it can be tricky to pinpoint, around 3% of our volume from China is below that threshold. Therefore, we're assured that our impact is minimal. It's also important to note that our business is diversified across various regions, products, services, and trade routes, and has demonstrated resilience. Our sellers are strong, and we have a global network supporting 7,000 trade routes. Although we're keeping a close eye on the situation due to the existing uncertainties, we are optimistic about our business's durability, our customers' strength, and the overall momentum we have. Ultimately, our focus is on creating long-term value.

Great. Thank you for that. Appreciate it. And as a quick follow-up, one quick modeling question. Could you add any color on the cadence of adjusted EBITDA throughout the year by quarter?

Yeah, for sure. So, look, we talked a little bit about the core revenue cadence in that mid-teens and just stepping up very modestly over the course of the year. Transaction costs we called out in our guidance, we expect them to be at 18% of total revenue, again stepping up over the course of the year and again, from mix shift and declining interest rates in the back half of the year. So, directionally, if you're starting more or less aligned with that Q4 exit rate and stepping up to around that 18% or 19%, that's how we see transaction costs behaving over the course of the year. Adjusted OpEx is relatively flat for those first two quarters or so. Stepping up modestly in Q3, stepping up again in Q4 from seasonal impact. But more or less, if you assume a pretty consistent 24%, 25% adjusted EBITDA margin overall over the course of the four quarters, you're very much aligned with the expectations we have for the business.

Great. Thank you for taking the questions.

Thank you. We have no further questions. And so, I'll hand the call back to the management team for any closing remarks.

Thanks everybody for joining us today. We have had an extraordinary 2024, a standout Q4, and we're confident in our team, the size of our opportunity, the power of our brand, the moat around the firm, and the response from our customers. So, probably the final thing I want to say is thank you to our shareholders for your support and to our team for their incredible hard work.

Thank you everyone for joining us today. This concludes our call and you may now disconnect your lines.