Release Date: February 18, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Truecaller AB (TRUBF, Financial) reported a 23% year-over-year increase in net sales for Q4 2024, reaching SEK523 million.
- The company achieved a record high of 429 million monthly active users, marking a 15% increase from the previous year.
- EBITDA grew by 19% to SEK201 million, despite higher growth-related investments and incentive costs.
- Truecaller for Business showed strong growth with a 45% year-over-year increase, driven by verified business consumer experience and business messaging.
- The launch of a new iPhone app is expected to boost subscription revenues, with iOS users already contributing 43% of total subscription revenues.
Negative Points
- The company did not fully reach its target of 45% annual net sales growth from 2021 to 2024, achieving 40% instead.
- Higher incentive costs were incurred due to an increased share price, impacting overall expenses.
- The Indian tax authorities initiated a tax survey on Truecaller's transfer pricing model, which could potentially lead to increased tax scrutiny.
- Server costs are expected to rise in 2025 due to the new iPhone offering, potentially impacting margins.
- The company halted its share buyback program in Q4 2024, which may affect shareholder returns in the short term.
Q & A Highlights
Q: Could you discuss the succession from your previous role and ensure a smooth transition for the Truecaller business and ads business?
A: The transition was smooth due to our well-staffed leadership. Frederick, who managed parts of our revenue, now oversees all revenue, including advertising and Truecaller for Business. This internal transition negated the need for external hires.
Q: What has changed regarding user growth and subscriber growth, especially in premium subscriptions?
A: We unlocked investments made in 2024, improving conversion and retention through our user monetization engine. Growth came from various regions, with India contributing significantly. Simplifying subscription plans also aided user growth.
Q: Can you elaborate on the potential of Truecaller for Business and future product ambitions?
A: We've only scratched the surface with existing customers, as many processes haven't migrated to our platform. We see potential in fraud protection and CRM within enterprises. Our product offerings continue to expand, unlocking further growth opportunities.
Q: How do you foresee the impact of the new iPhone app on revenue, and which markets will you target?
A: The new iPhone app, launched recently, is expected to boost subscriber revenue starting Q2. Markets with good iOS penetration, like India and the US, will drive revenue growth.
Q: What are the recruitment needs and growth-related costs for 2025, especially with the iOS launch?
A: We plan a 5-10% increase in employee costs due to selective recruitment. Growth investments, including user acquisition and marketing, will increase but remain within our financial targets.
Q: How are you managing your cash position, and is there room to return more to shareholders?
A: We've spent over SEK1.5 billion on buybacks and dividends since the IPO. Future capital allocation will be decided by the board, with a focus on operational targets and shareholder value.
Q: How is the adoption of the new iOS app progressing, and what are the dependencies?
A: Adoption depends on users upgrading to iOS 18.2 and the latest Truecaller app version. It's a gradual process, but we expect increased adoption over time.
Q: What is the industrial sector mix for ad revenues, and is there a focus sector for 2025?
A: Ad sectors vary seasonally, with gaming, e-commerce, FMCG, and electronics being prominent. We maintain a broad-based customer approach without focusing on a specific sector.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
