Release Date: February 13, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- CM.com (XAMS:CMCOM, Financial) announced a comprehensive refinancing package for its outstanding convertible bond, showcasing improved financial strength.
- The company achieved record levels of EBITDA and gross profits, surpassing its guidance from the summer of 2024.
- CM.com (XAMS:CMCOM) launched new AI innovations, including the Playground AI and Agentic AI Studio, positioning itself as an AI-first company.
- Operational efficiency improved significantly, with a reported 18% decline in OPEX year-over-year.
- The company successfully completed an equity issue with strong support from high-quality investors, enhancing its growth potential in AI.
Negative Points
- The Pay business unit faced challenges with fierce competition in the online segment, affecting topline development.
- Despite improvements, the annual recurring revenue showed only a small uptick in growth in Q4 compared to Q3.
- The company had to take a goodwill impairment of EUR8.8 million on its Pay business, reflecting challenges in aligning with current market valuations.
- The competitive landscape in the online payments sector remains a concern, impacting revenue growth.
- The integration of new AI solutions like HALO is still in early stages, with potential revenue impacts yet to be fully realized.
Q & A Highlights
Q: What's your plan with regards to buying back the bonds? Will you first utilize the RCF and use cash for the remainder? Also, how do you plan to manage OPEX while investing in AI?
A: We are using the facility with the banks to buy back the bonds and have issued new share capital to strengthen our balance sheet. We plan to grow our company and profitability, which will allow us to reassess our financing structure in a year or two. Regarding OPEX, we expect AI to make our operations more efficient, allowing us to accommodate growth without increasing headcount. Our HALO program is being integrated into every department to enhance efficiency.
Q: Can you elaborate on the momentum in the Engage business unit and the sales funnel development?
A: The momentum in Engage is strong, especially after launching HALO. We are focusing on existing clients for easier integration and doubling the price for HALO services due to its added value. Our target market is the midmarket, which offers shorter sales cycles and scalable opportunities. We see strong demand for our European-developed AI solutions, particularly in Europe.
Q: What is happening with the Pay business unit, and how do you plan to address the lack of momentum there?
A: The Pay business unit has faced challenges, particularly in online payments due to fierce competition. We are focusing on building our pipeline and converting point-of-sale devices to our new processing platform. While online payments have struggled, in-person payments are growing, and we have a plan to improve performance.
Q: Can you provide more details on the Connect business unit's growth and the impact of a major global tech platform?
A: The Connect business unit has seen growth due to increased traffic from a major global tech platform. We focus on offering the best quality and price, which has helped us capture more business from large tech platforms. The growth is driven by multiple communication channels, including SMS, OTT, voice, and email.
Q: How does the HALO AI platform's pricing model work, and what are the expectations for its impact on revenue?
A: The HALO AI platform's pricing model is based on doubling the price per resolution compared to our previous conversational AI platform. Most clients pay an annual recurring revenue bundle price, with additional charges for over-usage. We are initially focusing on upselling to existing clients and then targeting new clients. It's too early to include HALO's impact in our guidance, but we expect significant revenue growth.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
