All right, before we begin, research disclosures, which I don't have, but talk to your sales representative. Now we can begin. My name is Josh Baer, software analyst at Morgan Stanley. I'm thrilled to have the Toast leadership team here today, Aman Narang, co-founder and CEO, and Elena Gomez, CFO. Thank you so much for joining us.

Thanks for having us, Josh.

Aman, I want to start high level. If you think about the Toast story, maybe how it's evolved over the last couple of years, what parts of the operating playbook remain unchanged, what has changed?

First of all, thank you, everybody, for joining us. In many ways, the Toast playbook and strategy has not changed. If you look at what's happened in the business since we IPO'd three years ago, So in our core U.S. S&B business, we have doubled market share and now have 20% of all restaurants here in the U.S. in our S&B and mid-market segment and are seeing incredible momentum. And if there's one thing that's a top priority for us as a team, it's to make sure that in our core business we are leaders. You know, we see tremendous opportunity to continue to grow. You know, we, as an example, in our flywheel markets where we have the most density, So the way we break down these markets is we look at penetration based upon market share, and we're still seeing above-average growth in our most penetrated markets. That gives us some signal about what's possible. And a big part of why we're investing is to continue to differentiate the platform and separate from the pack further, and I'll talk about that later, to continue to make sure we have the best possible platform for our customers. In terms of numbers and scale, we've gone past 2 billion ARR. We grew recurring gross profit 33% last year in terms of what we shared on margins. We are at our midterm goals in the mid-30s on margins. We think as we continue to grow and scale, the most important thing for us is to continue to grow and scale because the margin profile of the business, the incremental margins in our core are very good. And then part of the reason really three years ago we said we need to go invest to open up the opportunity beyond the U.S. restaurant market is we saw that there was a lot of overlap between what we were doing in the restaurant business and markets that we were not in. So as an example, enterprise markets, upmarket, international markets, we've launched now four countries, and then retail, where we now support food and beverage retail in a big way. And those businesses are doing really, really well. We shared last year, they crossed 100 million in ARR. They doubled last year. There's a path to continue to grow and scale. So those businesses, that's a big part of our strategy. And then, you know, I think we're all talking about what's going on with AI and what does that mean for all businesses. And so one of the things that we are very – there's two areas we're focused on. One, for our customers, there's tremendous opportunity to leverage AI to help them do a lot of the work today that they're doing manually. We'll share more about that later. And then internally, right, you've all heard about how, you know, AI is making developers more productive support. And so we're seeing our top developers now being twice as effective and twice as fast, in some cases more, by leveraging some of these AI tools. A third of our support tickets never hit so human already. And the big focus there across really the entire organization to leverage AI is to say, how can we then accelerate growth? How can we take all that investment and point it to the most important opportunities for our customers and continue to grow and scale the business?

Great overview. Elena, you've got a lot of momentum heading into 2026. You got it to 20% to 22% growth in your recurring gross profit metric. EBITDA margins are up. What's the biggest driver of that gross profit growth? How important are locations? What other factors could drive that to the high end or even above?

Yeah, great, great question. First of all, I'm really excited about the team's execution through 2025. We had just an amazing year all the way through, and locations was certainly part of it. In terms of our guidance for a top line, 20% to 22% growth on RGP was where we started for the year. And as we always do at the early part of the year, we're really balanced and prudent in how we approach the year. We have less visibility, obviously, as we get into the year. We always aim to do better. And in terms of what are the swing factors really that would drive that growth to be higher, There's a few things. One, GPV, always a dynamic in our business that we're managing, too. Also, our TAMs. Amon just talked a lot about our TAMs and how we're investing behind those. To the extent we have data that tells us something is really working beyond our expectations, we may double down on that because that's a priority for us in terms of driving long-term growth. And then, of course, in our core business, which is the majority of our business, to the extent we see greater productivity that could drive upside to our plan. So those are the things I think about. And when you look back even at the last couple of years, GPD performance definitely played a role in our improvement versus starting the year. And the team outperformed as well over the last couple of years. So really proud of that execution. And then when you think about, okay, in that context, where would you invest more? It's behind those same things. It's behind going faster. If we have an opportunity to go faster in these towns to drive growth and the data proves that it's the right investment, we take a super disciplined, data-driven approach to it, we will lean into it. Similarly, we would lean out if we saw something that didn't make sense. But overall, incremental investments beyond where we are today would be pointed at these innovations. And then Aman talked a lot about AI, and that's a really big opportunity for us as well. And so we'll take the opportunity to lean in there as well.

Let's stick on that topic of AI. Obviously, the market is concerned about the durability of moats and incumbents. And so I want to ask you directly, why is Toast, you know, well-positioned? What happens if an AI native entrance shows up? And ultimately, does AI, you know, strengthen your position or does it eat away at it?

Yeah, we really believe AI strengthens our position. You know, we are the most important piece of technology our customers use to run their business. It's where they work. If you look at, like, a restaurateur's, you know, how they spend a lot of their time, it's understanding across all of our capabilities how their business is performing and what they can do to make sure whether it's their guest experience is as good as it can be, the employee experience, supplier and accounting inventory, of course the operations of the restaurant. And, you know, it's often at the intersection of all this technology that people are getting the most value. And it's like there's software, there's hardware, there's FinTech, there's payments and lending, there's very specific regulatory needs, compliance and regulatory challenges there. There is, you know, it's not well known, but we do all the networking for our restaurants, right, to make sure that our customers, if the Internet's down, they call us to help them make sure that the platform is operating. As you can imagine, it's mission critical at 9 o'clock at night when a restaurant's operating. No matter what happens, you've got to make sure things can continue. And so you've got hardware, software, payments, lending, payroll. Across all of that software, you know, one of the things our customers really value, they almost look at us like an outsourced CIO in that they're leveraging our teams to make sure they're getting the most out of our platform. And so I think the opportunity for us is to look at some of this work that is often done through humans and it's manual to say, what are ways in which we can leverage AI to help them get more out of Toast and to help them run a better business? So I think Toast IQ is really, we've shared, what we've launched with Toast IQ is the foundation there where it's essentially a co-pilot that sits alongside the Toast platform. So when you log in to Toast, you can do things like ask questions, get custom data and reports. You can do things like understand, make changes to the back end based upon, let's say, something's out of stock or you want to update something on DoorDash and Uber Eats, for example. You can manage a lot of the config. And then, you know, over time, we're building out custom workflows as well in the back end, which I'll share more about. And so I think there's a big opportunity to leverage AI to help make our customers more productive. Another example is voice and video. We have pilots going with voice AI where if you call a restaurant on the phone, the voice AI can answer the call. That's voice for phone is one modality. Think about walking up to a kiosk and being able to order. There's more complexity there with ambient noise, but over time is a solvable problem. Similarly, even with the terminal, you can imagine that there's so much opportunity with voice to be able to make the experience and the workflows more efficient. And then with video, there's a lot of opportunities. There's a lot of startups now looking at video feeds to detect fraud, to detect theft, to understand what's going on, even things like the restaurant's clean. And so the biggest challenge for us really is to prioritize and say what is the order in which we're going to leverage what this technology enables and to land use cases that really matter for our customers.

Excellent. I want to double-click on Toast IQ. In the first four months, you mentioned over half of your locations had already started using ToastIQ, I want to ask about what monetization looks like down the road, potential for impact to SaaS ARPU, and then also today, if you are seeing any impact to win rates or retention or just any general engagement trends there.

Our win rates and our retention numbers are really good. We've shared that in the past, but our win rates last time we shared was up year over year, both for FSR and QSR. Retention numbers are strong in the business. As you mentioned on ToastIQ, we've seen good adoption of the platform, but it's still early. I think in terms of monetization, my expectation is it's going to be very similar to most of these AI platforms where it's usage-based for the base agent. And then where I think there's a tremendous amount of value is to build on top. So I'll give you an example. Most of our customers are using fractional people that don't even work full-time for the restaurant to do things like bookkeeping or accounting or marketing, even payroll and tax. And so one of the things we are piloting right now, we've got customers using it already, is on top of all of our products that we offer for demand generation and marketing, things like online ordering, gift card loyalty, CRM websites, and our toast advertising product, we have a team that is going in and saying, with our AI agent, we will optimize all those channels. So it's things like making sure on your website your online ordering has images that are compelling. It's making sure that the campaigns you're generating for marketing are compelling. AI does a very good job of that. It is getting those campaigns out to all those different channels that matter, both online and through their data that they collect. That's phase one. And we're already seeing with that marketing agent that the usage and the value we're creating with our first-party software is greater. because, again, restaurateurs don't have, you know, they're using fractional help to do it, and we can do it better, and we can do it more efficiently. Now, you think about, like, where this could go. Most restaurants don't do a great job of looking at when they're really busy and when they're slower to try to optimize yield, right? And so the opportunity that we have is we've got over 30 million accounts, Toast accounts in our back end that have signed up for Toast to get online ordering, for example, or to set up our loyalty program. And so if you're a restaurateur, it's really valuable to say, okay, let's say I have a Mexican restaurant here. Who are the people that love Mexican food, that have never been to my location, that live around here, and are big spenders? And so for those folks, how can I generate the right custom messaging and offers to get them to try our location? and that's why our big focus for us with our, part of the reason we're investing in a big way in our local app is we want to get that audience number up and so you'll see for example we just announced last year a partnership with Resi and Talk and the idea is you can book a table on Resi Talk as well as on our tables product and when you go to a restaurant now when you've booked a table to any of these platforms at the end of the transaction one of the most painful parts about going out to eat. It's just like having to wait for your check at the end. So you can just walk out with the card on file. And you can personalize the experience off of the data that now we have about you. And so as we build up that audience in local, we believe it's the opportunity for us to create the best experience for dining in and the best experience in terms of the best offers that are relevant to you based upon your dining history. And so I think there's, hopefully that paints a vision for what AI can enable, where instead of it just being us being software providers, the vision is we can do a lot of the work more efficiently. And we may have some humans in the loop in the background, by the way, to support all of this, to actually drive incremental course party demand. And we're doing this not just, of course, we were testing with not just marketing. We have examples of pilots going with bookkeeping and accounting, some of the back office tools. And the strategy is all of the software that we offer, we want to see whether agents can play a role to actually drive greater value for our customers.

which is really helpful to lay out that vision. I want to shift gears and talk about payments and GPV and maybe starting with consumer spending and the backdrop there. There's a lot going on when you think about GLP-1s, tax refunds, changes in preference in dining. I mean, what are you seeing as far as traffic, ticket sizes, and consumer backdrop?

Yeah, it's fair. There's always lots of puts and takes going on in the macro, But at the highest level, consumer trends are stable. And when you look at our GPV per location for several quarters, it's been within a narrow band. And to the point you're making on all the backdrop, restaurants have always proven to be really resilient. When we look back at data at various economic cycles, there's a resilience in restaurants that they know how to navigate. And so our confidence in that GPB prolocation staying in that narrow band continues as a result of just looking at this data time and time again.

That's helpful. And with regard to fintech monetization, your take rates have been expanding. Which levers are repeatable looking ahead, thinking about pricing or mix or new products? Which is the biggest opportunity?

Yeah, it's a great question. We view there are several levers that are very durable for us over the long term, and we are very confident over the long term to drive our long-term take rate up. In the near term, really proud of the team's execution. They added four basis points of improvement year over year to our run rate, which is on the back of these initiatives you laid out, whether it's cost optimization, a little bit of pricing, new product development. And, in fact, those are the same levers that they're maniacally focused on for the long term. So cost optimization, you know, at our scale of $200 billion in GPB, that affords us some negotiation leverage. It affords us even more scale on a per-transaction basis. And then, of course, there's a whole team focused on how can we innovate around our platform to drive more value and deepen our relationship with our customers to the extent we can drive more digital transactions. Obviously, that'll impact the take rate. And then pricing, we're following the same strategy and philosophy that we've talked about, which is really starting with small, targeted improvements over time. And over time, as we continue to build a platform, there may be an opportunity to lean in more over time. But in the short run, we're going to really be focused on targeted moves.

Great. I want to shift the conversation to focus on location. In the first couple of questions, we identified location additions as the core growth driver of the model. I think you're now powering about 20% of SMB and middle market restaurants in the U.S. In your top 10 markets, you continue to have higher productivity, showcasing the flywheel effect. And so how much longer can these high-penetration markets display that flywheel type of growth? And as a follow-up, you've guided to more net new locations this year in 26 versus last year, where you added, I think, over 30,000. What's the composition of this location growth across the core enterprise, international, and retail?

So first off, like the past few years, we've been able to continue to add more and more net ads every year, and we expect to do the same this year. and I think that's really at its core, fundamentally starts with our core business, as I talked about earlier, and even Elena was talking about pricing earlier. The most important thing that we're focused on is to make sure in our core business we have a path to market leadership, and that's why we're investing in a big way in the platform. The data signals we've seen from our most penetrated markets shows that there's a path to continue to gain share in a big way based upon the share gains we're seeing, and I think for markets that we launch later, we have the same strategy where we're investing in the natural cycle to how restaurateurs buy this technology, and we want to make sure that we're in as many decisions, our win rates are strong, and the signals that we see internally tell us there's no reason why we cannot have, in our core business, durable location growth like we have for the past three years, based upon the signals we've seen. Despite all the progress, we're a 20% share, and you look at what it can be if you're a leader in a category over time, it can be far greater. And the investments that we're making with AI and some of our data are all about reinforcing, having a path to continue to expand not just ARPU, but the differentiation in the market of the products that we offer. In terms of the new TAMs, I think we always get feedback that I spend a lot of time talking about these new TAMs when they're smaller, right? And I am very excited about the potential here because if you look at whether it's a restaurant that is in Boston or San Francisco or London or Toronto or Vancouver, our strategy has always been from day one, by the way, to really focus first and foremost on the busier restaurants that are more successful. And you look at, like, as an example, a handheld Toast Code 3, you know, the thing that, you know, people say time and time, if you go talk to restauranteurs and the staff in restaurants, they'll tell you the thing they love about it is that it turns tables faster, the owners are happy, you get more in tips, right, and the guest experience is better. And so all the investments we make in our platform is focused on improving the experience first and foremost for these busier restaurants. And if you look across the world, in these tier one cities, there's lots of busier restaurants where Toast can help them run a better business. And so that's a big part of the strategy on these new TAMs, whether it's in international markets, enterprise upmarket, enterprise restaurants just by nature tend to be busier in terms of GPB per location versus SMB. And then in retail, it's been really interesting. This was the one area when we launched retail two and a half years ago, we had more questions even internally from our team about what is the strategy here. We've been so focused on restaurants for a decade plus. How do we think about the expansion into retail? And it turns out that the challenges that we're solving in retail, we started with restaurant retail, now we're doing grocery and convenience and gas stations and liquor stores. That business has done tremendously well because the challenges they face in terms of using legacy technology are actually very similar to what restaurants were 10 years ago. And that's why we've seen this market start to take off. And so I think as we think about why we have so much confidence to our location growth, it's because we have confidence in our core business that we continue to take share. That's all the signal we see in our data. And we're focused very much on continuing to separate from the pack in terms of the differentiation our platform offers with AI. And then we're expanding the TAM in a big way to continue to serve, to open up the opportunity with our platform.

Perfect. I want to ask a quick follow-up on some of the growth TAMs. Starting with international, you recently launched Australia. That's your fourth market in Canada, Ireland, and the U.K. What factors go into your decision process determining what markets to enter? What should we expect as far as future expansion?

Yeah, Elena and I talk about this a lot. I think, you know, the balance for us is how much, I think for the most strategy, at the end of the day, like how much you can take on, this goes back to like how much can you do well? Like that's the fundamental question I think we're asking ourselves. And so the way we do that is we've committed to these countries that we've launched so far in the UK, Canada, Australia, and Ireland, and we're seeing really good success there. We're focused on making sure that in those markets, our strategy is working back to the busy restaurants that we have a path to market leadership over time, and we are going to make sure, first and foremost, we invest in those markets to de-risk our ability to have a path to a really great business. Because back to the supply world effect, it really matters when you get to 5% share and 10% share because social proof is such a big factor in how people buy. And so the last thing we want to do in these markets is be spread too thin and not have a path to market leadership. And we're seeing really good signal, by the way, in terms of productivity, or reps is fundamentally not that different than the U.S., which tells us that the – and the customers are telling us that they see value in our platform. Now, in terms of new markets, you know, back to, like, the strategy in busier locations, if you just think about that for a second, like, actually that points to a strategy where you want to be more of – you want to be, like, really focused on the Tier 1 cities across the world versus going super deep in every – across the entire TAM in these countries. Right. And so and so part of what we're looking at is as we think about Western Europe, as we think about, you know, other parts of the world where there are large cities that have, you know, high GDP per capita and and restaurants and restaurants are thriving. Like, what is the strategy to open up more of that TAM? Because, again, those customers can benefit from toast. And the thinking there is, you know, like any horizons testing, we have we have a team that goes in and is doing future testing and learning. to try to understand when we launch, and the signals always starts with customer. What is the customer feedback? What is the team's feedback on the ground? What are our win rates? All the things we're looking in the U.S. And then we're also looking at the economics. So, for example, in some markets, one of the questions we're asking ourselves is, do we want to go direct or do we want to go through a partnership where we may not go to some of those markets anytime soon and maybe there's a partnership opportunity there to scale. So those are, I'm going to share a lot of texture there, but those are some of the factors that go into opening up new markets. But there's one thing I'll leave you with. It's making sure, Elena reinforces this to me all the time, is to make sure that in the markets we're in, we cannot end up number two because we're spread too thin across too many priorities.

So in Enterprise, in 25, you signed two of your largest customers ever, Applebee's and Firehouse sub. and you have a strong pipeline there. I guess I'm wondering what specific capabilities helped you win those large deals. And also, you're rolling out a drive-thru product. Does that change the game for you in enterprise?

For context for everybody, we didn't really have an enterprise business three years ago. Our core business was the U.S. SMB, and we had a really good penetration mid-market, up to 500 units, but really not much of an enterprise business to speak of. And now we've scaled up and gotten many brands that are using the platform, and part of that is just focus. We've focused and invested to build out the above-store capabilities that are necessary in enterprise, and we've set up the organization. We have a dedicated leader who drives the enterprise business, and in terms of how customers buy there, how they're serviced, the level of support they expect, what they expect from a product, there are some differences. But the thing that got us conviction that we should invest here is if you talk to franchisees or you walk into some of these restaurants that are enterprise brands, within the four walls of a restaurant, they still get a ton of value, right? So, you know, Applebee's, for example, like you walk in and you hear like, oh, the handheld is really helping us, just like an SMB's. Or you walk into a Firehouse Subs location, and even very early in the rollout, one of the things they saw was with our kiosk product, they were seeing better throughput, they were seeing higher check size, and the cost to the franchisees were actually going down. And so often, like, within the store, there's lots of innovation that we've built in 10-plus years in SMB. It really applies. And in terms of, like, what's gotten us to start to now open up the enterprise business, it's really, like, all the capability you need. So if you're managing 10,000 stores, like, how do you manage across all of that in terms of, you know, things like your menu, all of the config and the toast backend, the APIs that needed, the partner ecosystem, the security compliance needs. There's some just very specific needs that we were lacking, that we've built out. And what's exciting about the QSR opportunity is, you know, we're going to GA a product in QSR this year. In enterprise, in the U.S., QSR is 70% of the opportunity. And so that is a part of the market where, and we see customer pull. Like we're getting into RFPs now that we never did because customers see the value of what Toast offers. And so that's an exciting launch for us where I think, And within DriveThru, not only will customers be able to benefit from the full platform that Toast offers, we're actively looking right now at how to leverage, and I know it's still early. We're not quite there on this, but how to leverage voice AI because that's a key use case for DriveThru where even if voice AI is not perfect at answering every interaction and there's a mechanical torque in the background to support you, it can be hugely productive. And so as we think about our drive-thru product, we're looking for other partnerships as well as organic investments to see are there ways to create a really differentiated platform for this big part of the market.

Great. And one follow-up on retail. You mentioned that your retail adjacencies are facing some of the same challenges as your core restaurant opportunity. Are there capabilities that you need to build to fully serve the retail market?

Yeah, for sure. I mean, if you look at our retail business, you know, a year ago we had seven people working and selling retail, and we saw enough signal with the product we had launched where we said, you know what, we should scale up the sales team. We had never scaled a sales team beyond restaurants ever in the issue of the business, and we for the first time did that last year, and the signal was strong enough that we said we should scale it again this year, and so I think the early signal in retail has been super positive. The ARPUs are already north of 10K in that business, not that different from our U.S. SMB restaurant business. And for context, five years ago, our SMB, our ARPU was 7K in our U.S. SMB business. And so those ARPUs will grow and scale over time. And I think back to what you said, the reason we have seen a lot of early success is we have built this platform that solves deeply for the needs of these retailers. So, for example, in grocery, there are very specific product challenges. In liquor, there are some very specific product challenges. In convenience stores, down to like even integrating with the fuel pump, for example, to make sure you can process payments for fuel that we have built out and are investing in. And we're replacing legacy on-prem solutions like we did with restaurants 10 years ago because no one in the cloud and with modern tech has done that. And that's really what's driving the wind rate and the adoption. now if you think about the roadmap moving forward you know it's actually not that different again than restaurants like over the last 10 years we've had to build out a lot of the product to support all these different restaurant types and I remember when I started this company I very much underappreciated how much complexity there is to support these businesses and all the different workflows that exist and it's the same thing in retail where you look at community stores for example you know very specific inventory needs or e-commerce needs and in grocery you know There's a lot of needs around how to drive throughput in a checkout lane that are very specific. Managing inventory while your grocery store is open has the very specific needs. And so we're building out all the capabilities in the product. And then our sales team has been interesting. I'd say maybe 80%, 90% of the sales we've done are in food and beverage retail. But we're actually seeing really good traction beyond that as well. It's very early. But whether it's in home and garden or even B2B retail, in a B2B retail that very specific needs are invoicing and custom pricing custom websites it almost starts to become like ERP over time but we're starting to see really good traction beyond even food and beverage retail where again we're learning and I think that is going to be a part of our strategy like as we think about the next decade part of it's going to be of course like making sure again we're focused on the TAMs we're in where we're scaling but I think a big part of it is going to be learning in these new TAMs because like if you just zoom out for a second today like Toast is known to power neighborhood restaurants and like there's no reason if you think longer term why it couldn't actually power a lot of the neighborhood because there's so much overlap like you think about like walking to retail location the software and hardware you need to take an order take a payment run payroll run a schedule like so much overlap with what we offer for restaurants that if you can build the specific capabilities in retail i think there's a lot of upside there it's really

helpful amon uh and some really exciting growth opportunities a lot of momentum there but alana how do you think about the economics of some of these new initiatives? One thing that you look at is payback period. How do these new TAMs, paybacks in these new TAMs, differ from the core? What's acceptable from a payback threshold as you're scaling these new TAMs?

Yeah, no, really important question for us. So we've operated at mid-teens payback in our core for a very long time. And just zooming out, one of the reasons we're in these businesses, and you can hear the energy from them on, is we believe they are significant ARR opportunities and we also believe that they're profitable business for us over the long term. And so back to payback periods, certainly today where we are because we're scaling, the paybacks are elevated above 20 months, but we have also taken the core business from above 20 months to mid-teen months. So we know that playbook and we're going to execute against that playbook. And it's really across both honing the go-to-market motion, adding more product, and really the intersection of both of those that we feel very confident we can drive each of them to payback periods of sub-20 months. And that's how we're operating the business, that there's no scenario where we would operate a business over the long term that's not sub-20 months. So that's our operating principle. And then if you just take an example, Aman just talked about it, retail is already at a very healthy clip in terms of our poo. We talked about the fact that we're increasing our rep capacity. So today that rep capacity isn't in what we believe is the long-term rep productivity. And so as they scale, that will contribute to payback. And then we're really excited about the product innovation, the capabilities that we're building across each of these segments. So that's just one example. but at the highest level, we're operating with a principle that we will run these businesses at sub-20 payback in a few years.

Great.

Maybe one tweak. Rep retail productivity is very healthy for rep reps.

Sticking to margins, you've called out some near-term headwinds related to higher memory chip costs, tariff. What's the impact? How should we think about those? What's more structural or long-term? What's transitory?

Yeah, so first thing is our focus on long-term margins of 40% or greater has not changed despite this hardware, what we believe is a transitory impact. Certainly in the near term, we'll have some pressure. We've talked about that in earnings for memory specifically. It's about 150 basis points in 2026. Tariffs has a bigger impact in 26 and 25. All of this, by the way, is reflected in our guidance. And what gives me confidence in how we're navigating this is a couple things. One, we are working with longstanding relationships with our suppliers. Two, we have a very seasoned team behind the hardware operations, and they're maniacal about trying to optimize the price and really thinking about not just near-term, but what does long-term supply chain look like for us over time? So I feel really confident not only will we have the supply we need for 26, We have a line of sight into the supply for 27. And back to the first question, very confident it will not impact our ability to deliver long-term margins of 40% or greater.

Excellent. Let's close out the conversation just framing profitable growth. You've hit your medium-term margin targets faster than expected. So what should we expect from here as far as margin expansion?

Yeah, that's a debate that Amon and I, we talk about a lot, right? Because, what's that? We talk about this a lot. It really frames how we think about the company. First of all, you're right. We got to adjust to debathom margins earlier than we said at analyst day. And we also have a core business that's already at 40% margins with high incremental margins. And as Amon talked about earlier, that's the majority of our business. The reason we're investing in these new TAMs is because we really want to drive long-term growth. And as I said earlier, we believe not only will they contribute ARR in a significant way over time, but they are going to be profitable businesses for us. That maniacal focus on payback periods is what gives me confidence. And then when you think about it, a lot of these TAMs are drafting off the centralized operations that we have in R&D and G&A. So looking at that entire picture, I feel really good not only about adjusted EBITDA margins, but really GAAP margins. Like, we've done a lot of work to drive our stock-based compensation down. We've been incredibly disciplined in thinking about that as just like any other budget line item. And so when you look at the complexion of margins, both on an adjusted EBITDA basis and on a GAAP basis, we're really proud of how we're executing.

The only thing I'll just add to what Elena just said is to the extent that AI allows us to move faster in the business or to drive efficiency in the business, we understand that that is both a massive opportunity and also can be an existential threat. And so we're going to make sure we're not left behind in terms of making sure that, you know, today people talk about support and R&D being the areas, but across the business that we're leading when it comes to adoption usage of AI to drive value for our customers and our internally efficiency internally in the business.

Aman, Elena, we're over time. Thank you so much for the conversation.