Sportradar Group AG Q2 FY2022 Earnings Call

Good day, and thank you for standing by. Welcome to the Sportradar Second Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Christin Armacost, Manager Investor Relations.

Thank you. Good morning, everyone, and thank you for joining us for Sportradar's earnings call for the second quarter of 2022. Before we begin, I would like to point out that the slides we will reference during this presentation can be accessed via the webcast on our website at investors.sportradar.com. These slides will be posted on our website at the conclusion of this call. A replay of today's call will be available via phone and on our website. After our prepared remarks, we will open the call to questions from investors. To be fair to everyone, please limit yourself to one question plus one follow-up. Please note that some of the information you'll hear during our discussion today will consist of forward-looking statements, including, without limitation, those regarding revenue and future business outlook. These statements involve risks and uncertainties that may cause actual results or trends to differ materially from our forecast. For more information, please refer to the risk factors discussed in our annual report on Form 20-F and the Form 6-K furnished with the SEC today, along with the associated earnings release. We assume no obligation to update any forward-looking statements or information which speak as of their respective dates. Also during today's call, we will present both IFRS and non-IFRS financial measures. Additional disclosures regarding these non-IFRS measures, including reconciliation of IFRS to non-IFRS measures, are included in the earnings release, supplemental slides, and our filings with the SEC, each of which is posted to our Investor Relations website. Joining me today are Carsten Koerl, Chief Executive Officer; and Alex Gersh, Chief Financial Officer. And now I would like to turn the discussion over to Carsten Koerl.

Thank you, Christin, and thank you to all of you for joining us today. We are pleased with our strong results in the second quarter, highlighted by a 23% revenue growth, which we believe showcases the power of our business model. The Sportradar team has delivered excellent results through the first half of the year, even in the face of global adversity. We remain confident about our vision, the quality of our execution, and our multi-year growth strategy. Based on our strong results year-to-date and the visibility of our business, we are increasing our revenue guidance for the year to a range from 24% to 27% growth, up from our previous guidance of 18% to 25%. As you know, we are the leading global sports technology company focused on the sports betting ecosystem globally, enabling immersive experiences for sports fans. The combination of our unique experience platform, network, and technology, along with the worldwide sports rights we have acquired over the past 20 years, has built a business that we believe will deliver long-term shareholder value through, first, consistent strong revenue growth; second, growing profitability with business leverage and margin expansion over time; third, exceptional operational execution by a senior management team with a proven track record of delivering outstanding results; and last, but not least, strong free cash flow and disciplined capital allocation. The highlights for quarter two, speaking of capital, in July, we paid down €200 million of our €435 million debts outstanding. Post-repayment, our cash position remains solid with over €500 million and over €600 million in available liquidity. We believe that our business model can achieve 55% to 60% free cash flow conversion targets over the long term. Revenue in the second quarter increased by 23% compared with the second quarter of 2021, driven by strong growth in the U.S., our managed betting services, and our global ads business. Our revenue is a combination of subscription-based and revenue share products. Subscription revenue accounts for around 70% of our total and is a stable source of growth for us. The rest, our revenue sharing solutions, include some of the fastest-growing opportunities such as the betting footprint in the U.S., our MBS segment, and the ads solutions. Our success can be seen in the net retention rate, or NRR, which is one of our most important client metrics. NRR for the second quarter was 115% and has been above 100% for the past two years. Total customer attrition in 2021 was less than 1%. The rest of the world business, accounting for over 80% of revenue, continues to grow at double digits for us. Last quarter, we highlighted our managed betting services, which include managed trading services and managed sportsbook services. Our MBS revenue increased 65% year-over-year. We estimate we handle over €8 billion in transactions in the first half of the year alone and remain on track to handle between €17 billion to €20 billion of transactions in 2022. This would make us one of the top five bookmakers in the world, including DraftKings and FanDuel as a comparison. I'd also like to highlight our ads business, growing nearly 40% year-over-year. We continue to demonstrate to our largest betting operators that we can offer more efficient customer acquisition, retention, and lower cost per customer than competing solutions by over 50%. We also announced a joint venture with Ringier this quarter. One of the biggest media houses in Europe will bring immersive experiences for sports fans in Africa. Leveraging Ringier's media platform Pulse, we now have the ability to reach millions of African sports fans with integrated 360-degree solutions from risk management, interactive sports services, and marketing tools to connect with over 30 million existing African media profiles. This will mark a milestone and create a blueprint for future activities and partnerships with other large media operators in interesting betting jurisdictions around the globe. Now to the U.S. business, which grew 66% in the second quarter. As you will recall, we have been investing in the U.S. since 2014, which we believe provides us a clear first-mover advantage in the States, building on our demonstrated success in other parts of the world. We have built an ecosystem of leagues, betting operators, and media customers that is second to none. Sportradar data and proprietary platform products support 70% of the in-play net gaming revenue in U.S. sportsbooks. We have over 275 digital media and broadcasting customers and cover over 90 sports every day of the year. The U.S. business accounts for approximately 15% of our revenue, and while the EBITDA margin is negative, it continues to improve each quarter. Our U.S. business has delivered 57% revenue CAGR between 2019 and 2021, driven by growth in online sports betting, acquiring key data rights from professional leagues, and the proliferation of sports data used in the media. We see core industry growth across three key components. First is an increase in the legislation of sports betting across the country. Second is our ability to successfully negotiate long-term profitable deals and deliver more value from customer relationships over time. And third is upselling services and products, which enables our customers to create more value and gain efficiency. Live betting services are key components of this strategy. Importantly, we have also invested in deepening our relationship with the leagues through prudent sports rights acquisitions paired with actionable plans that should drive future profitability over the life of the contract. Our adjusted EBITDA loss margin profile has narrowed substantially, pointing us to a clear path to profitability in this region. As proof, in 2019, we had more than 100% negative adjusted EBITDA margin in the United States, which narrowed to a 32% loss in 2021, and further down to an adjusted EBITDA loss of 19% in this quarter. This performance improvement is ahead of our expectations and bodes well for our long-term plan of building an attractive, profitable U.S. business. This operating leverage we are seeing is a balance of accelerating revenues, streamlining the organization, and cost optimization. For example, we have reorganized our U.S. sales team under one experienced sales leader and created enterprise and emerging accounts teams to better serve our customers and the market. Just this month, we made changes to our product and operation team, bringing us closer to our customers. These changes will yield a more efficient and coordinated team, leading to a strong foundation in the future. Our customer optimization has focused on product and pricing strategies, allowing us to be more effective in what we sell to our customers. In fact, we have recently engaged with some of our larger betting operator customers to develop a value-based pricing model, which has been received very well. Lastly, in our focus on profitability, we are acquiring sports rights, which we believe is a differentiating strength of the company. We have excellent visibility into our spotlight costs over the next two to three years. We continue to expect rights to grow over time. We fully expect to grow our revenues faster. Overall, given the strong revenue growth, market positioning, and an increased level of cost discipline, we now expect to achieve profitability in the U.S. at least 12 months ahead of the original 2025 target date. Additionally, I want to announce that after having led us through the IPO process and the first three quarters as a publicly listed company, our Chief Financial Officer, Alex Gersh, has decided that he and his family want to move back to the United States. He will be leaving Sportradar at the end of September to accept another position. I appreciate Alex's many contributions to Sportradar and invite you to join me in wishing him well as he embarks on the next chapter. We have launched a search for a new CFO and have named Ulrich Harmuth as Interim CFO. Ulrich, who has been with the company since 2013, has served as Chief Strategy Officer since 2020 and has been a member of my management team overseeing corporate development activities, including M&A, strategic partnerships, and ventures. I'm confident in Ulrich's leadership and support of Sportradar's growth and contribution to the execution of our financial priorities. With that, let me turn the call over to Alex to talk about the financial results.

Thanks, Carsten. And good morning, everyone. First, let me thank Carsten for the opportunity to work at Sportradar. It's been an exciting two years. While I'm relocating back to the U.S. and taking on a new challenge, I have no doubt that Sportradar will continue to go from strength to strength in its business. Now, let's start with the financial numbers. As Carsten already stated, we had strong revenue growth across all segments in the second quarter. Revenue in the second quarter of 2022 increased 23% to €177 million versus the second quarter of 2021. Growth was strong across all segments, with the highest growth coming from the U.S., where we grew 66%. Our revenue outperformance came despite losing approximately €5 million from business in Russia due to the conflict with Ukraine. We reported adjusted EBITDA of €28 million for the second quarter, down 13% year-over-year, primarily due to the continued impact of the Russian-Ukraine conflict, investment in our technology and product, and some impact from new sports rights contracts. As is always the case, new sports rights contract profitability will improve as we accelerate the sales process. Our unlevered cash flow conversion increased to 157%, due in large part to favorable FX transactions from our cash balances. Our cash and equivalents exiting the quarter were €760 million, with total liquidity available of €826 million. As Carsten mentioned, in July, we paid down €200 million of our senior secured term loan, and I will go into more details later on. Now to the segments. Rest of the world betting, our rest of the world betting revenue grew 21% in the quarter to €96 million, representing 54% of our total revenue. Growth was primarily driven by an uptick in our higher value-added offerings, including managed betting services (MBS) and live services. More specifically, MBS revenue grew 65% year-over-year to €33 million due to record turnover, while live data and ad revenue grew 3% to €43 million due to upselling content to our existing clients. In addition, we saw increased content sales from our Synergy acquisition made in the same quarter last year. Rest of the world betting adjusted EBITDA decreased 8% to €43 million. The associated adjusted EBITDA margin declined to 45% versus 59% in the prior period. As I mentioned previously, in the second quarter of 2022, we saw the impact of the Russia-Ukraine conflict. We continued investment in product and technology, which is mainly headcount, to drive future growth and acquire new sports rights. As I have said previously, and is almost always the case, the margin on new sports rights improves over time as we accelerate the sales process for those products. The rest of the world audiovisual segment grew 9% year-over-year to €40 million. This growth was primarily driven by new customers and traction with our Synergy acquisition, offset by loss of revenue from Russian customers. Rest of the world audiovisual adjusted EBITDA increased 22% to €13 million, and the segment adjusted EBITDA margin increased to 33% from 29%, primarily due to higher personnel costs, partially offset by lower sports rights costs. Turning to the United States, which continues to be our highest growth segment, revenue grew 66% year-over-year to €29 million. We spent time on this earlier in the call, so I will simply summarize that we saw over 60% growth in betting, over 90% growth in audiovisual, driven in large part by last year's Synergy acquisition. Ads and sports media grew at approximately 50% each. Second quarter U.S. adjusted EBITDA was negative at €5.5 million, a sequential decrease of about €1 million. U.S. adjusted EBITDA margin was negative 19% versus a negative 27% last year, driven by operating leverage. As we highlighted earlier, we remain confident in the continued progression towards profitability sooner than 2025 at this point. Now a few words on the cost. Personnel costs for the quarter increased by €18 million to €64 million, in line with our expectations, as we continue to hire and acquire in areas of product and technology to further our growth goals. Purchase services and licenses in the second quarter of 2022 increased by €11 million to €43 million compared to the second quarter of 2021, primarily resulting from increased cost of content creation and processing and in line with the revenue growth. This really relates to growth in our cloud hosting capabilities and apps business. Last, total sports pricing cost increased by €14 million to €49 million in the second quarter of 2022. Growth was driven by new 2022 rights, as well as a return to a normalized schedule for sports such as the NBA. Liquidity. Our liquidity and cash generation remain strong and are actually strengthening. As we previously discussed, we continue to evaluate the best use of our cash and capital structure. Continued revenue growth and our strong liquidity position enabled the company to prepay a portion of the outstanding term loan facility B in the amount of €200 million in July 2022. Even after that prepayment, our available liquidity stands at €639 million. We are confident that the strong and improving cash flow generation will allow us to invest in the business and take advantage of market opportunities as they arise. Our adjusted free cash flow increased to €36 million in the quarter, up from €13 million last quarter and from negative last year. Our unlevered cash flow conversion increased to 157% from a negative 7% last year. Approximately €31 million was attributable to favorable FX gains on our cash as the euro weakened significantly during the quarter. We maintain our medium-term unlevered free cash flow conversion target range of 55% to 60%. As a reminder, we currently pay interest on our debt semiannually in the second and fourth quarters of the fiscal year. And now just to summarize the guidance, let me update it, as Carsten already mentioned. For the full year of 2022, we are raising our expected revenue outlook to a range of €695 million to €715 million, or a growth rate of 24% to 27%, up from a prior range of €665 million to €700 million, or a growth rate of 18% to 25%. Because we do not anticipate any improvement in the Russia-Ukraine conflict this year, we are maintaining our adjusted EBITDA in the range of €123 million to €133 million, representing a year-on-year increase of between 21% to 30%. The result implies an adjusted EBITDA margin for 2022 of between 17% and 19%. Thank you all, and I will now turn it back over to Carsten for some additional remarks.

Thank you, Alex. In closing, I want to remind everyone of our key priorities. We continue to invest in our business with a focus on our core betting products, expand our portfolio through internal development and opportunistic accretive acquisitions, and we will be prudent stewards of managing your capital, balancing risk and opportunities, all in the name of long-term shareholder value creation. With that, I can turn over to the operator to open up for Q&A.

Thank you. Carsten, just to follow up on the commentary to achieve U.S. profitability. I'm wondering if you could unpack that a bit; what are the specific revenue or cost buckets where you see Sportradar outperforming your prior expectations?

Hello, David. Thanks for the question. If you simply follow the quarters from 2021, we had been negative 34% in the third quarter, negative 33% in the fourth quarter last year, 25% in the first quarter this year, and now 19% in the second quarter. We clearly see a trend of operating leverage. In terms of the segments, undeniably, it's sports betting and ads product, which is growing at 40%. From a sports betting perspective, we continue to see more states coming online, which is naturally good for us. Furthermore, live betting is key for us. The margin is significantly higher for anything related to live, and we are benefiting from this. Thanks to our first-mover advantage, we hold a 70% market share when it comes to the profits generated by operators with live betting. That is where our revenues come from. Does that answer your question, David?

Yeah, very much. And Carsten, you know, you sit on a lot of data about consumer betting habits. Just wondering if there's any insight you can share on the consumer as we've seen kind of economic slowdowns across many regions you operate in?

We see absolutely no slowdown. I receive this question frequently. Yes, there are some small markets, primarily retail markets, where operators encounter issues, but this is more than compensated for in the larger markets, particularly online. If I observe the results from our clients, and as you've likely noticed from several published results, you see similar tendencies and trends. This industry is resilient to economic downturns. In the event of a downturn, we even notice an increase in requests for sports betting in many markets. Overall, we see no impact, and in some markets, even a slight positive impact from increased betting activities.

Thank you. We have a question from Ryan Sigdahl with Craig-Hallum. Your line is open.

Good day, Carsten. Alex, good luck on your next venture. We want to dig into guidance first. Does the current range contemplate potential impacts from Ukraine and Russia for the rest of the year or is that outside the range, similar to previous guidance?

No...

It contemplates the current downside.

And just to be clear, considering the previous guidance, it was outside that range, given the wider potential outcomes, and now we're further along in the year. Is that right?

That's right. Everything that we expect to come out of Ukraine and Russia, all negative impacts are factored into these numbers.

Great. Then for my follow-up, just on the EBITDA margin being flat year-over-year. Obviously, Ukraine and Russia are impacting that, among the other things you've mentioned. But as we sit here today and considering your headcount, infrastructure, technology spend, etc., do you think you're in a reasonable place to resume higher EBITDA margins starting next year and going forward?

We have stated that we continue to invest, but we are growing our team and investing in technology. However, we are also fully aware we have to operate within the guidance or perform even better. We are closely monitoring our efficiency and evaluating where to invest, with the U.S. being a focal point for us. Whatever happens there, it's a strongly growing market, but we also have other growing segments like our trading services and managed platform services, where we, of course, invest.

We have a question from Bernie McTernan with Needham & Company. Your line is open.

Thank you for taking the question. Just a follow-up on the U.S. Are there any thoughts on how the new NBA contract could impact the trajectory of EBITDA profitability going forward?

You know that the old NBA contract is still valid for the next season. After that, we will begin with the extension. As I mentioned in my remarks, we are transitioning to a value-based pricing model and are currently in discussions with significant operators, which are looking promising. I think we can announce something in one of the next quarters to provide more transparency. We are working on creating value for our clients and, of course, for us.

That's great. I appreciate that. I also wanted to dive into your claim of delivering 70% of In-Play NGR in the U.S. If I'm right on that, could you elaborate on why you have higher market share in In-Play versus regular betting?

We deliver our service to 98% of the sportsbooks in the United States. There may be some very small casinos that do not receive our services. From this perspective, we nearly cover the entire market. The interesting aspect of live betting is that it is the segment where we focus the most, which also brings us the highest profitability. These figures originate from our clients. If we evaluate our clients and revenue share, this is how we compile these numbers, which stem from our first-mover advantage. We began operations in this area in 2014, enabling us to build client relationships that include, for instance, a preferred supplier clause. Thus, if other suppliers present the same data, the sports book must choose us because of the existing contract. This provides us a favorable starting position in this critical segment. I hope this clarifies the numbers.

We have a question from Robin Farley with UBS. Your line is open.

Thank you. Just to revisit and clarify your guidance. At one point, you mentioned potentially having a €13 million disruption from Russia and Ukraine, and now you're stating that this won't impact guidance. Is that due to less disruption, or is it the same disruption, but the rest of your business is outperforming your expectations?

Hi, Robin.

Sorry, go ahead, Carsten.

Alex, please go ahead.

It's the second one. It's as Carsten said, we have experienced very significant growth in ads. We have significant growth across other parts of the business. While it's not as high margin as the Russian revenue, which is effectively at 100% margin, that’s the reason why we are maintaining our guidance and including all the negative impact from Russia into the current guidance.

Okay.

To summarize, Robin, we are fully aware that we need to perform no matter what happens in the world or what external impacts exist. This company must manage these variables, adhere to our guidance, and deliver results. That is our full commitment. As Alex correctly noted, we managed to mitigate the impacts with various factors, and all negative influences are factored into the numbers in the guidance. We are fully committed to adhering to the guidance and delivering results.

Great, thank you. Just one more clarification: can you discuss how much of the revenue growth came from Synergy versus organic growth?

Alex, can you handle that?

The Synergy acquisition is situated in various segments, making it challenging to delineate specifically. I can say that in the U.S., our Sports Solutions business, which effectively encompasses Synergy, saw substantial growth from approximately €5 million last quarter to over €8 million in Q2 of 2022. Growth can also be seen in other areas that stem from Synergy, but isolating those impacts is more complex.

To clarify, of your total revenue growth, how much was attributed to Synergy in aggregate?

That’s something - so there's cross-selling from the Synergy business to other units, and I don't have the number for that aggregation. So that's my... The major portion is in the U.S., which I mentioned, but I cannot provide the breakouts for the other segments. With Synergy, we've acquired it and are now successfully cross-selling their products to our extensive client base.

Understood. Thank you.

We have a question from Steven Pizzella with Deutsche Bank. Your line is open.

Hey, good morning, guys. Just wanted to follow up on the U.S. business. It appears that U.S. revenues settle in at approximately 1.5% to 2% of U.S. sports betting KGR according to our math. One, do you think that's a good way to look at it, given I believe a large part of the revenue is from other revenue? And two, where do you think that can get to? Can you reach 4% to 5%?

Hi, Steven. No, I don’t think it’s a good way to look at it because you would be considering only data distribution. I hope we’ve made it clear that we are not merely a data distributor for the U.S. media and betting operators. We start with data and then upsell with probability products, which we refer to as Live Odds. This is followed by trading services and platform services, alongside our audiovisual product. All of this accumulates to significantly higher margins and explains the direction of our numbers. Pure data upselling alone would not suffice; we must deliver value to the client. If that value isn't present, growth cannot happen.

Okay, great. Thank you. I appreciate it.

We have a question from Michael Graham with Canaccord Genuity. Your line is open.

Thank you. I just wanted to ask about your ads business. You stated in the slides that ads grew over 70%. You mentioned a 40% growth number in your prepared remarks, was that for the U.S., and can you clarify that? Additionally, could you share how complete you think your ads solution is and the growth potential for that business going forward?

Looking ahead, we foresee continuous year-over-year growth from 40% to 45% in the ads sector for the coming years. We have developed a programmatic advertising engine with DSP and SSP, enabling us to maintain control over this aspect internally, which we believe is a strength. Over time, we have integrated components like paid social and offline campaigning to construct an ads business. This has evolved throughout the years, and we expect ongoing growth.

To add, the ads business in the U.S. has grown by 50%. However, the total ads business globally grew by about 40%, as it experienced slightly less growth in Europe, but in the U.S., it's experiencing a growth rate of 50%.

Okay, thank you. I also wanted to ask about the competitive landscape among the operators in the U.S. Given your insight through the ads business, is competitive intensity increasing?

A growth expectation of 40% to 45% over the next three years implies a strong competitive landscape. I think we have a specialized segment, and we have a tailored solution. Yes, there is competition out there, but we project significant growth. This suggests we can deliver competitive solutions.

We have a question from Shaun Kelley with Bank of America. Your line is open.

Hi. Thank you for taking my question. I wanted to return to the revenue outlook for a moment. I believe we've covered a lot regarding the EBITDA outlook, but as we think about your core revenue trends that gave you the confidence to raise guidance. Can you help us break down whether this improvement is more out of the U.S., where we're seeing solid growth, or healthier trends in the rest of the world?

Look, the rest of the world betting is the most significant segment for us, and we are growing more than 20% in the quarter. We continue to see growth, which is driven by upselling clients. I spoke about the NRR being 115%, and we've seen nearly no client losses of less than 1%. We can upsell scalable products like Live Odds. We are also seeing clients transitioning to our trading services and platform services, which are higher-margin products and contribute positively to our growth. Regarding the audiovisual segment, traditionally it does not grow as quickly, usually around 10%, but we are managing its profitability. The U.S. shows strong growth as well, with a four-year CAGR of 59%. More states are coming online with betting, and many media companies look to us for upselling opportunities.

Thank you. Lastly, there was significant FX volatility observed during the second quarter. Can you explain how this impacts Sportradar’s business? Are there anomalies or aspects that may arise, or are most costs aligned with market currency? Though it doesn't appear to have created a substantial impact from your euro report, could you elaborate on the effects on revenue and consumer side?

Alex, a relevant question for the CFO.

You're right; it's not super substantial. We are a euro-based company, and the cash valuation has risen significantly due to our dollar cash conversions. Regarding revenue, the impact has been minimal, a couple of million at best, and there is zero impact on EBITDA attributable to the balance of our dollar-denominated revenue and costs. So currently, there's no material effect on the P&L except for cash valuation.

Thank you very much.

Thank you. Our last question comes from David Katz with Jefferies. Your line is open.

Hi, this is Christy Cassandra asking on behalf of David. Thank you for taking my questions. Carsten, could you expand a little bit more on the U.S. live betting today? Can you tell us what the penetration looks like today and where you see it longer-term?

Yes. We have observed that certain sports are adopting live betting more readily, such as basketball. It's difficult to provide an exact estimate, but it is around 30% to 35% of all bets received. There are sports, which have lower live betting interest, like NASCAR or NFL, but we see significant growth in live betting. It's considerably more engaging and enhances the betting experience. In our key markets in Europe, Africa, Latin America, and Asia, there is a clear trend towards live betting; in saturated markets, around 70% to 80% of accepted bets are live, and we anticipate that the U.S. will follow this trend. It’s just a question of timing. Once fully adopted, the U.S. should mimic global levels of 70% to 80% of all bets being live. The trend has already begun, and it cannot be reversed, which is positive and logical since in-play betting connects bettors emotionally to the game.

Thank you. As a follow-up, single-game betting seems to be gaining popularity in the U.S. Is the company offering products or pricing on these types of offerings, or are there plans to develop such an offering?

Yes, this falls under the betting engine component. With our platform services, we offer this, including with our trading services, along with calculators or parlays and integrating bonus or buyback programs. If you have a parlay and some of your picks are already winning, you have the option to buy back the bet, which utilizes algorithms we've developed. It's a typical and growing trend, enabling individuals to place small bets with significant potential payouts. This presents an opportunity for a more entertaining and engaging experience, moving away from the traditional Vegas betting approach. Thank you.

Thank you. There are no other questions in the queue. I'd like to turn the call back over to Carsten Koerl for closing remarks.

Thanks to everyone for joining the call today. I want to reiterate our ability to meet and exceed the revenue expectations, despite the ongoing challenges we face from the Russian-Ukraine conflict and the general economic unease. With our cash flow and capital in a stronger position today, we will continue to look for growth opportunities and consider smaller accretive acquisitions. We will also relentlessly drive leverage into our business model, particularly in the U.S. I want to personally thank our Sportradar team for their unwavering commitment daily to serve our customers and build our business. I couldn't be prouder of what we've built over the past 20 years. I remain incredibly confident in our prospects for the future. Thank you for joining the call.

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.