Dassault Systèmes SE ($DSY)

Good morning, good afternoon, everyone. Thank you for joining this conference call. Pascal Daloz, our CEO and Chairman; and Rouven Bergmann, our CFO, on the line with us to discuss our first quarter 2026 earnings. During this call, results are prepared in accordance with IFRS. The financial figures discussed on this conference call are on a non-IFRS basis with revenue growth rates on a constant currency basis unless otherwise noted. Some of the comments on this call contain forward-looking statements that could differ materially from actual results. Please refer to today's press release and the Risk Factors section of our 2025 Universal Registration Document. All earnings materials are available on our website. I would like now to hand it over to Pascal Daloz.

Thank you, Marie. Good morning, good afternoon, everyone. Before handing over to Rouven, I really would like to put this quarter in perspective to our trajectory. So if you remember what I said in February, 2026 is the year of execution, not the strategy, not the vision, really the execution, execution to strengthen the foundation for sustainable growth, to accelerate our transition to subscription and to deploy our industrial AI strategy. Now let me start with where we are. Back in Feb, we set a clear commitment. And I think today, we are delivering on them. Q1 is on track. Revenue is up 3%. No surprises, no deviations. We confirm our full year outlook, 3% to 5% with an acceleration in the second half, and we will come back on this. But beyond the numbers, what matters is really the trajectory of what we are building. And we are, in fact, delivering this with 3 levers, 3 priorities: one, transforming our existing clients; two, expanding into new frontier, new territory of conquest; and three, scaling our industrial AI offers. And I think we are executing consistently across all those 3. Let me start first with our installed base. Globally, I think our clients are not slowing down. They are adapting. They are transforming themselves. And in fact, they are not constrained by the demand for most of them, but they are constrained by the complexity. Too many systems, too many regulations, too many unexpected things coming from the geopolitics. And at the end, this is creating much frictions between the design and the execution between the sourcing and the supply. And this is really where we come in. And if you look at carefully our results, this is where it's visible, it's really on the recurring business. First, with the annual run rate, which is up 6%, and Rouven will come back on this. The cloud is up 8%, which is more than twice to our total growth. And 3DEXPERIENCE, our platform is up 7% despite a high comparison base, if you remember last year because we had this significant deal with Lockheed Martin. This is not, again, for all of our customers. This is not only a shift in terms of tools, it's really a shift of in how companies operate. The second lever, the second priority is the new frontier. This is really where the growth will come next. Here, there are a few things to say. One, in Life Sciences, I think we can say the environment remains challenging, but our platform approach is starting to deliver some results, and I will come back on this. In the consumer, we see discipline, speed and scale, strong growth in apparel and a growing momentum in food and bev and retail. And I think we are really building strong position for the future. Third, 3D UNIV+RSES. This is the most important shift. And this is where really AI move from promises to reality, not pilots, not proof of concept, but real use cases in production. And I think this is possible because everything is powered by our industrial AI architecture, which has been designed, imagined to serve the purpose for the industry. Now if we look at the industry at large, and if we step back a little bit, one thing is clear. I think we are increasingly acting as a critical partner, and it's visible. If you take the mainstream performance, it's broad-based. SOLIDWORKS continue to drive a strong momentum. And in a way, this could be seen as an early indicator of the underlying demand across industries. Second, in Transportation & Mobility, demand is holding despite the volume pressure. And I think we remain the reference for most programs around the world, and we continue to expand in the Americas. In Aerospace & Defense, after strong comparisons last year, the next wave is ahead and budgets are increasing, especially in the defense space, and we see traction concretely this quarter in Marine & Offshore, where we signed significant deals. Beyond the core, a few things needs to be noticed also. As I say, in the consumer, growth is strong, driven by Centric with sizable win in apparel, such as Nike and a growing momentum in food and bev and retail with landmark transactions this quarter. Ferrero is one of them, Amazon is another one. In High-Tech, our solutions benefit from the global scale-up of AI and the cloud infrastructure. And in the Life Sciences, as I say, we are transforming a fragmented and a slow environment with our platform approach. And finally, in infrastructure, the growth is driven by complex energy program, and I think where sovereignty matters. So the common piece across all those industries, I think we are helping clients to move faster to improve quality and to use capital much more efficiently. Now let's zoom on concrete example. Take Eaton. Eaton is a global leader in intelligent power management, and they are at the center of electrification. Their challenge is very simple to scale the execution without adding complexity. And how do they answer to this by unifying everything on 3DEXPERIENCE platform on the cloud. And today, over 20,000 users work on one single systems and the result, faster time to market, optimize costs and the value creation in hundreds of millions. Another good example is U.K. Fusion Energy. Their ambition is really to deliver the Fusion power plant by 2040. It is definitively one of the most complex engineering challenge in the world. They choose 3DEXPERIENCE as an operating system to connect the ecosystem at large. And as you know, for such object, you have a lot of, a lot of companies involved to ensure the data continuity between the design, the engineering, the construction, the operations and to build the secure infrastructure. So this, I think, is a good example of what the transformation is about when it's at the frontier of innovation at the same time. Now if we move to the new frontier, there are many things we could say. First of all, in the semiconductor, the race for AI infrastructure is really accelerating. And you know that designing advanced chip is extremely complex. That's why with our multiphysics simulations, company like Annapurna Labs, they can design and validate faster and delivering the next generation of the cloud infrastructure. And you know Annapurna Lab is one of the Amazon company, and they are the one for sure, providing some chips -- high-value chips to AWS. If I look at in Life Sciences, we are reinventing the CRO business model, shifting from a labor-intensive approach to an AI-driven operating model. And this is extremely important for them because they are -- I mean, it's a must -- so with our AI-powered MEDIDATA platform, company like WCT, Worldwide Clinical Trials, they move from a thousand of fragmented systems to a unified enterprise solutions, and this is giving them the ability to be smarter, to do faster studies, better executions and a real-time insights. And both really are driving growth and margin improvement. In the consumer, speed is really critical. And with Centric PLM, JM Smuckers accelerate product development while maintaining quality and control. As a result, faster innovations, better products and a model that has scale and scale across the industry. Now let's move to the third lever, 3D UNIV+RSES. And I think this quarter is also delivering tangible value. First, for the one who had a chance to be with us at MEDIDATA NEXT, last month, we demonstrated how we connect the full life sciences life cycle from the discovery to the clinical to the real-world outcomes. And with our AI virtual twins, whatever it's the virtual twin of the drugs, virtual twin of the plan, virtual twin of the cohort, we can do something which is unique, which is synchronizing the drug development life cycle with the patient journey. And to accelerate this, we have introduced Dot. Dot is our virtual companion for clinical intelligence. And the results are already tangible, 30% to 40% higher enrollment rates and a clinical data corpus build time, which has been divided by 5. I think it's really a step in change of performance. Second thing at GTC, it was in March also, we showcased our industrial AI architecture. And why this is important? Because most of our peers, they put AI on the top. We are putting AI at the core. And putting AI at the core means you have to redesign your architecture. And this is done. This has been published, demonstrated and showcases. And what is unique in what we did, in fact, we are leveraging 40 years of science and industrial data. We are connecting design simulations, data and workflows with one unified system, putting the industry world model as a foundation. And the industry world model is for our software, what basically the LLMs, they are for the others is the foundation understanding the physics, but it's also the foundation capable to produce physics. And this is where we are making a big difference. Now moving to the virtual companions. We are also releasing them this quarter. And you can see on the slide, you have a bunch. The takeaway is what it's not only 1 companion or 2 because it's how they could become more specialized, more intelligence and more connected. And to do this, we combine the industry know-how on one hand with the domain knowledge and the real-time data. And you can see if you take LEO with the virtual companion for engineering, you could specialize them by discipline. Now this is really the way we are scaling intelligence across the Board. Now to conclude, we will handle our Capital Market Day on November 17 this year, 2026 in Paris. And we will go obviously deeper into these visions and the road map, and we will also connect this with the financial plan. Thank you. I think, Rouven, over to you for more detail on the financial performance and the outlook.

Thank you, Pascal, and also a warm welcome from my side to you. Good morning, good afternoon. As you heard, Q1 was a solid start. We delivered revenue, margin and EPS well aligned with our objectives, demonstrating our continued focus on execution. Our recurring business continues to perform well as reflected by the consistent annual run rate growth of 6% year-over-year and a net ARR increase of EUR 35 million sequentially. Good operating discipline translated to strong operating cash flow performance, generating nearly EUR 1 billion in operating cash flow, up 22% at constant currency. The bottom line is we are laying the foundation for acceleration throughout the year and into 2027. Now looking at the details of the financials for this quarter. Total revenue reached EUR 1.510 billion. It's up 3%, excluding currency, software and services revenue all up 3%. On the revenue mix, upfront license revenue came in slightly better than anticipated, up 9%, driven by a number of significant multiyear deals. Subscription revenue grew 3%, reflecting a tough comparable from the landmark Lockheed Martin deal closed in Q1 of last year. Now turning to our recurring business growth. The annual run rate or ARR provides a consistent view of annualized growth at a rate of 6%, and this is independent of the timing of revenue recognition. And in the quarter, we added EUR 35 million in annualized value sequentially, bringing the total ARR to EUR 4.371 billion, encompassing all active subscriptions and maintenance contracts, including the annualized value of multiyear subscriptions where IFRS requires upfront revenue allocation. So what drove the ARR this quarter? It's a growing share of cloud bookings and continued expansion of multiyear subscription deals with higher total contract values. This broad-based momentum translated into double-digit subscription ARR growth. Now turning to our growth drivers. 3DEXPERIENCE platform is at the core of our growth strategy. In Q1, 3DEXPERIENCE saw 7% growth ex FX and makes up 42% of our Eligible software revenue, which is up 3 points compared to last year. Also, cloud revenue grew strong at 8% with good momentum in the take-up of 3DEXPERIENCE cloud, which was up 30% year-over-year. And as you heard from Pascal, some of our key wins for Eaton, U.K. Fusion and all of them on the cloud. We are executing on our growth drivers with a rate of growth, which is more than 2x when compared with our total software revenue. Now looking at the geos. Europe delivered healthy growth of 7% in the quarter, broad-based across regions with strong contribution from Home & Lifestyle and key energy deals. This is a clear illustration of our diversification strategy at work, delivering impactful solutions across an expanding set of end markets. Asia posted a mixed performance. It was up 3% with a slight revenue decline in China as a primary headwind. But outside of China, the business remains resilient across geographies with Korea, Japan and India all contributing meaningfully in our core industries. Americas was down 1%, reflecting a tough comparable from the Lockheed Martin contract expansion of Q1 last year. Excluding this effect, Americas grew mid- to high single digits. The underlying performance was strong with double-digit growth in Transportation & Mobility and Industrial Equipment and even stronger momentum in consumer industries. Now let's move to the performance of product lines. The Industrial Innovation was flat in Q1. It was mainly due to the tough comparable, as mentioned earlier. Adjusted for this, Industrial Innovation was up mid-single digits. The growth replicated across our core manufacturing brands, DELMIA, SIMULIA, ENOVIA and CATIA and driven by good traction in subscription revenue. Now over to Mainstream Innovation. Here, we had an outstanding quarter, 14% growth year-over-year. Centric delivered particularly strong return to growth this quarter, driven by notable new client wins, including a significant competitive displacement and broad momentum across strategic verticals such as food and beverage, retail and sports apparel. This is a meaningful inflection point and a testament to the new leadership team and the entire Centric team. Clients are validating the strength and differentiation of our offer as they look to transform their business in a very fast-moving consumer industry with AI at the center. This performance supports our full year outlook of mid- to high teens growth for Centric with Q2 mainstream growth expected to normalize sequentially from this quarter's level. Also SOLIDWORKS momentum continued with high single-digit growth in revenue and double-digit growth in units. The performance was broad-based across geos, and it underscores our strong value proposition in the mainstream market, where short sales cycles and time to value are essential. Now to Life Sciences. Q1 was still negative as MEDIDATA's business was mainly impacted by lower revenue contribution from partners. As expected, this reflects a carryover from lower 2025 bookings. While in the quarter, we saw bookings volume and value trending positive versus last year. Also important to highlight, we signed a strategic multiyear partnership with Worldwide Clinical Trials, a leading CRO, who is standardizing clinical activity on MEDIDATA's cloud platform and leveraging AI across all workflows to speed up and simplify study build and study execution. We see this as a first-of-a-kind deal. For 2026, we expect H2 to improve over H1, with the objective to reach a positive run rate growth entering 2027. Now turning to cash. We generated a strong EUR 949 million in operating cash flow in the quarter, which was up 17% and 22% ex FX. As anticipated, this was driven by positive working capital dynamics over the quarter as account receivables decreased sequentially, reflecting strong cash collections and a favorable impact from contract liabilities due to higher billing activity. Free cash flow was up 27% in the quarter, driven by strong operating cash flow. Cash conversion in the first quarter even jumped to 208% versus 167% in Q1 of last year. Seasonally, Q1 is a strong cash collection quarter. At the same time, the progressive transition of our business towards subscription and cloud creates an opportunity for continued improvement in cash conversion. Now to complete the picture, our overall cash and cash equivalents reached EUR 4.875 billion as of Q1, which reflects an increase of EUR 750 million versus Q1 of '25. Now looking at the investments in the quarter. It's also worth highlighting that we completed an acquisition of a start-up to expand our cyber systems strategy with ALM capabilities, Application Lifecycle Management. Combined with 3DEXPERIENCE, this acquisition offers a unique advantage for companies developing software-defined products. And we are excited to have a very talented team joining our Cyber Systems CATIA team. To complete the picture, our net cash position remains strong and stood at EUR 2.396 billion as of Q1. Now over to the financial outlook. Firstly, we are confirming our full year outlook for total revenue of EUR 6.290 billion to EUR 6.410 billion or a range of 3% to 5% growth ex FX, with an operating margin in the range of 32.2% to 32.6% and EPS of EUR 1.30 to EUR 1.34. And this represents 3% to 6% growth ex FX. For Q2, we expect total revenue in the range of EUR 1.518 billion to EUR 1.568 billion, which is up 2% to 5% ex FX. Software and services revenue are expected to grow in line with total revenue by 2% to 5%. We target an operating margin of 29.5% to 29.9% and an EPS of EUR 0.29 to EUR 0.31, growing in a range of 3% to 7%, excluding currency. And this is all based on our FX assumptions for an average rate as published this morning. Now to conclude, we had a solid start to the year. We delivered performance at objectives, and we confirm our full year guidance. Our growth drivers demonstrate that our strategy is working, providing the tailwinds for future growth. Our focus is on execution and operating discipline, as you saw in Q1, drove solid margins and strong cash flow conversion and strong cash conversion. This provides the foundation to invest in our long-term growth and accelerate our AI strategy to deliver tangible values for our clients, our employees and of course, our shareholders. And now Pascal and I, we look forward to take your questions. Thank you.

[Operator Instructions] We will now take our first question from the line of Jay Vleeschhouwer from Griffin Securities.

Pascal, let me start with you. You made an interesting comment with regard to your AI architecture and how you believe you're differentiating from your competitors who have also announced their products and architecture. The question is, how extensive do you think the virtual twin portfolio will become? In other words, do you think that you will take the extensive list of roles and trigrams you have in the core business, let's keep the Life Sciences business aside for the moment and transplant a parallel set of virtual companions or agents as part of the new AI portfolio. A couple of more questions.

Thank you, Jay, for this question. In fact, I think it's a good question. We still want to keep the portfolio of role and processes we have. And why? Because the virtual companion anyway needs to use an application. So for this reason, I think they are complementing each other more than if you want, substituting by each other. That's point number one. Point number two, we have the virtual companion and we have the generative experiences. The virtual companion for us is a way to associate to the applications, to the roles, the rezoning. And you will accept if you are scientists, if you are an engineer, if you are a production scheduler, your rezoning is not the same. And that's the reason why in order to basically optimize and in a way, sometimes lower the barrier of usage of our software, we are training our companions on this domain expertise and industry know-how at the same times. And then after the generative experience, it's a different paradigm. It's how you could automatize a sequence, a process. And here is really a way for us to balance if you want workforces with AI. And what we are measuring in this time is the unit of work. So in the reality, and I met many, many customers, they want to have the choice. They want to have the choice to use to be, in fact, to use human or to have the interactivity with the portfolio of role and processes. And for certain time or certain task or certain profile of people, they want to have the ability to either automatize with the generative experience or to, in a way, hire virtual companion, if you want rather than to hire people or basically to also to have to reskill some of their people. So this flexibility, I think it's very interesting things. Now there are certain roles, nevertheless, Jay, which are a little bit in between because we put in certain roles a lot of industry knowledge and know-how. And what we are doing, we are eliminating this role in order to basically transfer the value added, if you want, in the virtual companions. That's what we are currently doing. But I think the architecture of the portfolio is very clean, very understandable by the customer, very easy to, in a way, to price without having to destabilize the current pricing system. And it's easy to articulate also the value because they are complementing each other.

Okay. Continuing with you, Pascal, a quarter ago on the call, you mentioned new operating executive for the channel. And the question is, do you expect that the changes in the channel that you alluded to will go into effect this year? Or would it make more sense to do so at the beginning of 2027? And as part of that, our understanding or sense is that CPE is not performing necessarily as well as you would like or as well as CSE. And perhaps you could talk about how you're thinking about improvements there. And then I'll have a question for Rouven.

So you are right. I mean the primary focus of the person who joined the team, his name is, by the way, Pierre Barnabe. He's ready to transform the indirect model. And starting with CPE and why so? Because -- and you know it very well, CPE is still relying on one category of partner, the resellers. And the reseller model was a good model when we were selling application. Since we have moved to the platform game, those resellers, they have to become, on one hand, system integrators to connect the platform with the rest of the enterprise systems. The more we are moving to the cloud, the more they have to become a hyperscaler in a way because they need to understand the architecture. They need to understand how to support these operations. They need to understand the SLA concepts. With the -- basically, by broadening the portfolio outside of CATIA, moving to DELMIA, SIMULIA, where you have a lot of specialized domain you need almost to be an engineering services in order to understand the value of the specializations. And last but not least, for most of what we do, you need also to transform the organization and the profile of the people, which means you also need to become a consulting firm. So if you try to hire and to find one single partner having all the dimension, it's almost impossible. So this is the reason why specifically for CPE, we have to redesign the ecosystems, and we have to diversify the category of partners we have. And that will be the primary mission for Pierre, which is to define this new operating model to define the protocols to define how they can work together in order to fulfill the complete missions and to be a lever for us. That's, in a way, his mission. For CRE, the topic is a little bit simple, if you want, because I'm not challenging the reseller model. I think the reseller model is still valid because it's a volume approach. And I think what we are pushing is very well packaged, very well suitable. Everything, even if it's cloud-based, you do not have to basically articulate the value of the architecture. It's really a pure services. There is nevertheless some transformation to be done. I think they could accelerate the digitalization of the sales. And this is where I think, again, Pierre could help a lot to promote the online approach, not to bypass the partner, but to help them to be much more efficient to decrease, if you want, the cost of sales and also to prepare for AI as well. So that's really at the high level, the 2 key missions. Now there are some tactical things we want to do this year, especially related to the reward program for the resellers, the incentives. Those are really tactical and it's a way basically to redirect a little bit their focus. But most of what I'm describing, it's something you will see the benefit starting 2027.

Okay. Finally, for you, Rouven, looking backward at your 2025 numbers in your annual report, we can see that your remaining performance obligations or backlog, if you will, declined by about EUR 85 million. Maybe you could talk about the components of that, mostly currency or some other organic mix effects? And would you expect the backlog to resume growth in 2026? And then finally, for you, Pascal, your favorite question on SOLIDWORKS. It was interesting you mentioned double-digit growth. We had estimated 9% volume growth. So it looks like you must have done around 20,000 units for the quarter, somewhat easy comp, but double-digit growth, nevertheless, if you could comment on that.

Thank you, Jay. On RPO, I can keep it short. The major effect of the decline is FX related, so currency related. But I think what's also important for you to know, the RPO is not really a good proxy of revenue growth because the RPO, it only includes revenue from deals with a duration of more than 12 months. So all subscriptions that have a shorter remaining duration are not included in this number. And you know that it can fluctuate depending on timing of renewals. So it's not a real good consistent number for you to project the revenue outlook. That's why we have the ARR, which is much more consistent, 6% growth, and this encompasses all active subscription and maintenance contracts in a forward-looking 12 months value. So I can -- I think I can really take some concern out of this number that you have when you say it's declining. In fact, there's an FX impact, but it's not a proxy to revenue growth.

And on the SOLIDWORKS performance, Jay, on the value side, the growth -- on the revenue side, the growth is high single digits, but the growth...

Double digit.

But the growth in terms of number of units is double digits. So why so? Because you see more and more the subscription in the mix. And that's basically a good sign. I think we -- I didn't check, Rouven, but we should be close to almost half of the new units being subscription-based now or that will be a license based. And obviously, all of them are on the cloud.

[Operator Instructions] We will now proceed to our next question from the line of Derric Marcon of Bernstein.

Two quick questions. The first one is for Rouven and the second one also, sorry for you, Pascal. But on the guidance for 2026, you didn't disclose this time the breakdown between upfront license and subscription revenue growth. Did you change or have you changed your way of thinking compared to 3 months ago or it's remaining in the same ballpark? And my second question, you talked this morning about an acceleration of the revenue growth in H2 versus H1, and you explained the bridge for that. Would you expect annual recurring revenue growth at constant currency to follow revenue growth? Or do you see here a deviation between the 2?

Okay. Derric, I like the question. Thank you so much for giving the opportunity. On the objectives, it's not much to add because they are consistent, they're not changing. We have given the details at the beginning of the year. We confirm software revenue, total revenue, services and from a revenue standpoint, of course, the margin and EPS. But everything is consistent from that perspective. And you saw that from quarter-to-quarter, we can have some fluctuations. This quarter, upfront was a bit stronger than subscription. But we expect subscription revenue growth to come back in the second quarter and then resulting in higher recurring growth because we had this tough year-over-year comparison from Q1 '25. And we also had several multiyear subscriptions that we reported upfront license in the quarter, which drove the upfront license number, as I mentioned. So not a real change here. The outlook is very consistent. But we are -- as you realize, and it gets me to my -- to your second question, it's a good transition. We are more and more focused on ARR. And we -- the advantage of looking at the ARR is that we represent all our business activity that is recurring in a 12-month forward-looking consistent view. And with this, we can give you really the underlying growth of our business momentum, which is consistent with 6%, it has slightly accelerated in Q1. We are on a trajectory with 3% software revenue growth in Q1. We are now forecasting 2% to 5% for Q2 with around 3.5% midpoint. And then we see an acceleration into H2, which is between 4% to 6% for H2 in terms of software revenue growth. But keep in mind, in the ARR, we already reflect the 12-month forward-looking portion, right? So all the bookings activity was from cloud transactions in Q1 that are not recognized that are not visible in revenue yet, they will become visible in Q2 and onwards. They are already reflected in our ARR. And as we build and win more deals, the ARR will continue to build. We have not guided on ARR in 2026 because we are, at this point in time, really looking at the track -- building the track record of ARR and the consistency in our reporting. So I do not want to do this right now to point you to an acceleration in 2026. It's too early to say. But we'll be very focused on ensuring that we execute and reflect the value of our business activities in ARR growth because we know that from a P&L standpoint, it's backwards looking. We have from time to time seasonality. We have tough comparisons that are all not relevant in ARR because we look at a 12-month forward-looking number, and it's consistent. So that's what you should expect in 2026. In Capital Market Day, of course, I will spend more time on that and prepare then also for 2027 because that's the point in time where we want to guide on the ARR and then also anticipate the acceleration.

Our next question comes from the line of Jason Celino of KeyBanc Capital Markets.

Great. Just one for me. Have you seen any impact from customers either delaying investment due to higher oil prices or due to the conflict in Iran? Any deal delays? I only ask as a few U.S. software companies have mentioned some deal slippage. Curious if you're seeing anything.

Jason, Pascal speaking and Rouven, feel free to add whatever you want. No, we do not. In fact, there are probably a few reasons for that. Remember, most of what we do is really related to the research and development investment cycle, a little bit less related to the operational cycle. So I think that's probably the reason why at least right now and for the rest of the year, we have not seen impacts neither in the pipeline, neither deal shifting or being basically reopened. That's not what we are seeing today. If the crisis stay the way it is, this could have maybe an impact, but at least not for 2026.

[Operator Instructions] Our next question comes from the line of Frederic Boulan of Bank of America.

Just one on my side. If you can comment on your shareholder return policy, how do you think about M&A right now versus share buybacks considering current level of share price, but also what's going on in terms of private valuations?

Thank you, Frederic. I will take it. Even if I was betting your question will be for Rouven.

But I can take this one, too.

But let me -- so I think it's -- again, it's a very interesting discussion. We spoke about it extensively last time. So my position is very simple. if you remember, for the last 3, 4 years, I was almost complaining every year that the valuation, they were far too high to have the payback on, I mean, some external move we were considering. Now we are entering in a period where all the software multiple are under pressure, and I think it's really a good timing. We do not see yet this impacting the private equity economy, but it will come. And we know that there are assets we are considering being owned by them. And I think the timing is helping us. Now coming back to your questions, I think I still will put more favor and more priorities on the external growth. But I'm not basically against to do some share buyback. And if you look at carefully the resolutions for the shareholder assembly, you will notice that I didn't change the absolute number in terms of value for the share buyback, but I have significantly increased the number of shares due to the basically the pressure on the stock. So at least this is giving you an indication of where I am.

We have now come to the end of the question-and-answer session. Thank you all very much for your questions. I'll now turn the conference back to Pascal for his closing comments.

Okay. So thank you very much for your participation. Again, just to remind you a few messages. We delivered Q1. We are on track. We are confident for the second half of the year. And more importantly, I think we are building the momentum, as Rouven explained, and this is visible with the annual run rate, which is giving us a better perspective for '27 and the years to come. Now the last message is with 3D UNIV+RSES, I think we are also changing the game because many of our customers, what they need is a system they can trust, a system that can understand the business and a system that can improve over time. And this is exactly what we do. This is exactly what matters. And that's what we will explain to you with more detail during the Capital Market Day in November 17. So thank you so much. Hope to see you on the road or in the coming weeks. And for the one I will not have a chance to see, see you no later than for the Q2 results. Thank you so much.