Delivery Hero SE (DHER) Q4 FY2025 Earnings Call Transcript & Summary

Welcome to the Delivery Hero Q4 2025 Trading Update. Today's presentation will be followed by a Q&A session. [Operator Instructions] I will now hand over to Christoph Bast to begin the presentation.

Hello, and welcome, everyone. Thank you very much for joining our Q4 2025 earnings call. Joining me on this call are Niklas Oestberg, CEO; and Marie-Anne Popp, CFO at Delivery Hero. Together, they will present the key highlights of our Q4 2025 results. Following their presentation, we'll be delighted to address any questions you might have. And now over to you, Niklas.

Thank you, Christoph, and welcome, everyone, and thank you for listening in. So 2025 was a challenging year with tough competition, FX headwind and regulatory uncertainties. Therefore, I'm very happy to share that we returned to growth in Korea as promised. We completed the rider model [ change ] in Spain and Italy. We accelerated growth in Saudi Arabia at the end of the year, which was even beyond our highest expectations. I'm also very happy to have turned the Integrated Verticals segment profitable while growing very fast. Staying on the topic of integrated verticals and Quick Commerce in general, then let's move to the next slide. So what you can see here is our Quick Commerce business, which represents the next frontier of our platform's evolution. We have moved beyond traditional food delivery to become an indispensable Everyday App, leveraging a hybrid model of food delivery, owned Dmarts and local retail partnerships. The primary strategic advantage is the deep structural stickiness it creates within our user base. We aren't just a service, we are a daily habit. We capture diverse shopping occasions across the entire consumer journey, starting from your essential grocery shopping over pet food, electronics to health and beauty products and so on. The result speaks for themselves. Quick Commerce is currently outpacing food delivery with GMV growth of over 30%. In addition to continued strong growth in groceries, we are seeing significant momentum across non-grocery verticals. Within this, health and beauty stands out, contributing over 50% year-on-year growth, while non-grocery as a whole already accounts for 20% of our Quick Commerce volume. With 2025 GMV surpassing EUR 7.5 billion, we are scaling rapidly to meet our 2026 GMV. Target of around EUR 10 billion, solidifying our position as the leader in instant grocery and retail delivery. Now moving to AdTech. Some time ago, we gave the ambitious long-term target for our AdTech business to reach more than EUR 1.5 billion revenues in the full year of 2025. As you can see, we came very close to this target despite a slower rollout of our AdTech products in South Korea. Although the share of AdTech revenues in Korea constantly increased in the last 2 years, it is still behind the group average, leaving plenty of upside. On group level, AdTech revenues grew to 3.0% of GMV in 2025. And in Q4, 2025, the share reached already 3.2%, with very attractive adjusted EBITDA margins. Our continuous improvements to the performance of the ad products contribute strongly to this growth. To name some key developments: Our personalized ad ranking system leverages neural networks to improve the relevance of ads and the efficiency of our user targeting. This, combined with our machine learning-based automated ad bidding and pacing, enabled return on ad spending to improve from 3.9x to 6x between 2022 and 2025, and is unlocking significant additional investments from vendors. In simple words, we offer better and more relevant ads with greater returns to our vendors. Throughout the years, we have stretched and strengthening our ad product portfolio, from launching display ads in 2025, our CPC rollout in Woowa in 2022 to keywords revamp and video as launched in 2025. These products support restaurants and vendors to increase visibility and conversion rates. Going forward, the main growth drivers for our AdTech business will be Woowa, Glovo and PedidosYa, which are all below group average right now but growing strongly. Our long-term ambition remains to achieve AdTech revenues of above 4% of GMV. And AdTech is just one area where we are seeing huge improvements from AI. As we navigate the broader AI transformation, they view our complex [ physical ] operations as profound structural moat. AI agents help us predict demand or recommend great restaurants to customers, but they cannot move physical goods, manage millions of real-time merchant integrations or run hyperlocal logistics, Dmarts and kitchens. Because our business is fundamentally anchored in hard, real-world execution, we're highly insulated from purely digital disruption. Ultimately, we see ourselves as massive beneficiaries of this revolution, leveraging AI to drive huge upside across consumer experience, merchant success and bottom line efficiencies. So with that, let me now hand over to Marie-Anne, who will guide us through the financial highlights.

Thank you, Niklas, and a warm welcome from my side as well. We finished the year 2025 strong, with Q4 showing further improvements in our 3 main focus areas: top line growth, profitability and cash generation. GMV in Q4 increased by 8% year-over-year on a like-for-like basis, and including -- excluding hyperinflation and FX effects, accelerating from 7% year-over-year in Q3, driven by significantly improved momentum in Asia. Revenue grew by 21% year-over-year on a like-for-like basis, growing again markedly faster than GMV. Profitability also improved with gross profit margin expanding to a new all-time high of 8.3% in Q4. The adjusted EBITDA grew to more than EUR 900 million in 2025 despite elevated growth investments in MENA and Asia, as well as particularly strong FX headwinds from the U.S. dollar and Korean won. One thing I'm particularly pleased about is that our free cash flow came in at more than EUR 200 million. If we go to the next page, Orders on group level grew by 9% on a like-for-like basis in Q4, accelerating from 8% in the previous quarter as the Asia segment has returned to growth, while all other segments continue to grow strongly. As mentioned, GMV growth for Q4 reached 8% on a like-for-like basis in constant currency, and excluding hyperinflation accounting, improving from 7% in Q3. Revenue increased by 21% and has remained above the 20% mark at the group level for several consecutive quarters. This robust growth continues to be fueled by the ongoing expansion of our own delivery logistics, particularly in South Korea and Turkey as well as a shift to the new rider model in Spain. In addition, the sustained strong performance of AdTech business and the continued appeal of our subscription programs have further supported this momentum. Let us take a closer look at the preliminary results for the full year 2025. The guidance for GMV was increased to the upper end of 8% to 10% year-over-year growth during our H1 trading update. Our slightly increased growth in Q4 was not able to fully compensate for a slightly weaker-than-expected Q3 growth rate, and we arrived at a 9% year-over-year growth. Total segment revenues rose by 23.1%, coming in at the midpoint of our 22% to 24% year-over-year guidance on a like-for-like basis. Adjusted EBITDA reached above EUR 900 million, compared to our guidance of EUR 900 million to EUR 940 million. And free cash flow exceeded our guidance of more than EUR 120 million and came in at over EUR 200 million, due to improved working capital efficiency and lower tax payments. Hence, we are pleased with our preliminary results for the full year 2025 and will now dive deeper into the Q4 performance on a segment level. In Europe, GMV growth was temporarily softer in the second half of 2025 since we were still optimizing the operational efficiency following the successful transition of our rider fleet to an employment-based model in Spain. This will still have some effects on the top line in H1 before growth is set to reaccelerate again in the second half of 2026. Performance in markets outside of Spain stayed robust, supported by healthy increases in orders and GMV in the majority of countries. Revenue growth in Europe was again driven by the year-over-year expansion of our own delivery logistics, which reached 82% in Q4 2025. The implementation of the new rider model in Spain and its associated change in revenue recognition as well as strong AdTech revenues and increasing basket sizes resulted in a particularly strong growth of 34% in segment revenues. After business review of our operations in Finland, we concluded that reaching a category leadership position would require prolonged and disproportionate investment relative to the long-term returns. That's why we exited the market as of mid-February, and we'll focus our energy on countries where we are already #1 or strong #2 and where we can generate the highest long-term returns. Adjusted EBITDA in Europe came in close to the breakeven point in Q4 2025. Through further efficiency improvements, we expect to be around adjusted EBITDA breakeven for the full year 2026. Let's move on to MENA. We have again delivered robust GMV growth despite challenging prior-year comparables as Q4 '24 was exceptionally strong due to concentrated growth initiatives. Throughout the region, fair competition regulations are being rolled out across Saudi Arabia, the UAE, Kuwait and Qatar, creating a more balanced environment that benefits the entire MENA ecosystem. It puts a halt to predatory pricing mechanisms that distort competition, disrupt smaller innovators and add a significant cost burden on local restaurants. Order growth in Saudi Arabia picked up again in December, with momentum even accelerating through January and early February. This performance was driven by an enhanced subscription offering with half of Saudi's GMV already coming from subscribers. Further investments are targeted incentives for high-value customers and the expansion of the multi-vertical proposition. Talabat once again delivered strong operational results, achieving 20% year-on-year GMV growth in Q4 2025 despite exceptionally high comparables from the prior year with growth of 33% year-over-year in Q4 2024. Growth was supported by the continued expansion of Quick Commerce and subscription offerings, improved partner-funded savings and an ever-growing selection. In Turkey, profitability improved substantially, resulting in positive adjusted EBITDA in the second half of 2025. Now on to the Asia segment. GMV returned to growth on a like-for-like basis in Q4 '25 across the entire Asia segment, supported by category share gains since May and increase in orders in South Korea, both driven by ongoing improvements in customer experience, which, among other things, has resulted in an outstanding year-on-year growth of 31% in the Quick Commerce business. The rest of Asia continued to strengthen, delivering GMV growth of 11% in Q4 2025, supported by an improved restaurant selection, more attractive vendor-funded deals, subscription rollout and a leading Quick Commerce proposition. We expect this positive momentum to accelerate further throughout full year 2026. Our operations in Hong Kong can look back on a particularly strong year in 2025 with accelerating growth throughout the year in both orders as well as GMV. Building on the momentum, the region and, in particular, Korea, has had a strong start to Q1 2026, with further acceleration in top line growth. Revenue growth remains robust, underpinned by the continued rollout of own delivery operations as its main driver, with the OD share for the segment increasing to 76%. Profitability was reduced by investments in product and customer experience to further strengthen our long-term business. Now continuing with the Americas segment. We accelerated order growth by -- to 24% in Q4, reaching the milestone of 1 million average daily orders. GMV grew 17% year-on-year, slightly below order growth, even though basket sizes increased across most countries. This reflects the impact of reporting Argentina in euro even within a constant currency framework since Argentina qualifies as a hyperinflation country. Quick Commerce and our subscription offering continue to be key growth drivers, strengthening our value proposition across the Americas. Revenue growth was further supported by the strong performance of AdTech, which outpaced the overall top line and still offers significant upside potential going forward. Adjusted EBITDA also improved materially in 2025, demonstrating the resilience of our business despite ongoing macro headwinds. Now on to Integrated Verticals. Our integrated verticals business continued to deliver outstanding momentum, achieving 25% GMV growth year-on-year. This performance was especially strong in the MENA region where demand is exceptionally high. Adjusted EBITDA improved markedly and reached breakeven for the full year 2025. This progress reflects our ongoing efforts to enhance the customer value proposition through broadening and strengthening the assortment to be more relevant as well as effective pricing strategies across our store portfolio. For the full year 2026, we expect a small positive adjusted EBITDA despite investments in our Dmarts expansion. Besides the pure Dmarts business, also our local shop offering, which is actually included in the regional segments, continues to perform exceptionally well, supported by the onboarding of key partners like Jumbo in Argentina, Carrefour in Qatar, or KIKO Milano in UAE. Our combined Dmarts and local shop business collectively known as Quick Commerce has now surpassed EUR 7.5 billion in GMV, and we're on track to approach EUR 10 billion in full year 2026, underscoring the strength of the business model. Let's now have a closer look at the gross profit margin. At the group level, our gross profit margin continued its upward trajectory, increasing by 10 basis points year-on-year to reach 8.3% of GMV, which is a new record high. Both MENA and Americas are already operating at strong and attractive GP margin levels. These regions are using their solid profitability as leverage to scale rapidly in the Quick Commerce space. In Asia, gross profit margins also showed steady improvement, expanding sequentially by another 20 basis points in the fourth quarter of 2025, largely driven by stronger profitability in South Korea. Europe is gradually recovering from the temporary impact of the transition to the new rider model in Spain. With that adjustment now largely behind us, we anticipate further margin expansion as we move through fiscal year 2026. Just as a reminder, as part of our continued efforts to streamline financial disclosures, starting in 2026, we will report gross profit only in accordance with IFRS and on a semiannual basis. Up until the release of full year 2025 numbers, we have had 2 structurally different P&Ls for management reporting purposes and for IFRS reporting purposes. These differences draw significant manual reconciliation, limiting speed and transparency, while increasing risk across many levels. Hence, we harmonized the 2 P&Ls, and from 2026 onwards, we'll disclose slightly amended but fully aligned KPIs. This will accelerate our internal reporting cycles and provide great transparency and comparability of our profitability drivers for the financial community. Let's now have a look at the affected KPIs. We're basically talking about 2 shifts. First, we will reflect revenue reductions, like vouchers or refunds, as a direct deduction from revenue. Instead of marketing expenses, thereby having the total segment revenues fully aligned with the IFRS revenue as published in our half year and annual reports. Secondly, we will have certain cost reclassification within the P&L to ensure both reporting structures are fully synchronized. While this results in higher cost of sales and a lower reported gross profit, it reduces our other operating expenses, meaning this does not have any impact on adjusted EBITDA and free cash flow. Also, GMV and group revenues will remain unaffected by these changes. Let's have a look at the upcoming dates. On 26 of March, we will publish our annual report 2025 and the full year 2025 earnings release, and also organize another analyst call. We will also give formal guidance for the full year 2026 that day. Until then, we would like to refer back to what we already stated in the Q3 trading update, namely that we expect moderate adjusted EBITDA growth for 2026 as we increase our investments in Talabat, Korea and Integrated Verticals. Without providing a specific outlook at this stage, we would characterize this as an adjusted EBITDA increase of up to a mid-single-digit percentage. From a cash flow perspective, we anticipate that the business performance will continue to improve the underlying cash conversion. At the same time, we will see higher investments in our Dmarts business as previously communicated. With these opposing effects together, a free cash flow slightly above EUR 200 million appears to be a reasonable expectation for 2026. Regarding the strategic review, we're carefully evaluating all relevant strategic options together with our advisers to unlock shareholder value. Given the nature and scope of the strategic options being evaluated, it is not in the best interest of the company and shareholders to give any interim details of discussions while they are underway. We will provide updates as soon as we are in a position to share details. Some options available to us may progress quickly, while others naturally require more time. Let me assure you that the organization is fully focused and working diligently across all work streams to assess every avenue to drive value for our shareholders. One more heads-up we would like to give to today's audience. We are thrilled to announce that Andrea Ferraz will take on the newly created role of VP of Investor Relations and Corporate Communications. Andrea joins us from Klarna in March, and you will get to know her over the coming weeks. That's it from my side. Thank you for listening, and we're now looking forward to taking your questions. Christoph?

Thank you very much, Marie-Anne. Before we enter the Q&A, I would kindly ask you to limit your questions to 1 panelist because this way we can ensure that every analyst has the opportunity to ask a question. And with this, operator, please go ahead.

[Operator Instructions] Our first question comes from Andrew Ross with Barclays.

Thanks for those comments on the outlook for '26 and strategic review. Given that I'm going to ask on Saudi, I ask if you can give a bit more color as to the changes that you've seen since the new regulation came into place at the end of last year. So could you be more specific about where Hungerstation's market share is today versus where it was pre-Keeta launching in 2024? And how much have you been able to regain since those changes came into place? And then I guess the follow-up to that is kind of how you're thinking about regulation coming in through the rest of the GCC region in this year?

Andrew, so we don't really look at category share the way maybe you do. We rather focus on how we are growing. If someone gives out on EUR 600 million in vouchers, of course, we'll get a lot of orders. The question is what is the kind of long-term sustainable order level. So what is the true category share that such a player has, versus what is the temporary order growth that someone will generate. Therefore, we don't really pay too much attention to that. We don't think it is that relevant. We try to look at underlying fundamental category share gains and losses. And the best way to do that is look at our own business and see how that is evolving and are we losing any of our customers. We believe that the customers that we have, which we have gained over multiple number of years through aggressively pushing our service, whatever customer we didn't gain during that time period is probably not a very good customer. But of course, if someone offers $100 to order from SWAN, you will have a lot of riders and cleaning people and SWAN also ordering because it is simply free money to gain. So coming back to that, like how does our business look and evolve? Well, first of all, we grew prior to Keeta entering, we grew at 15%. We obviously pushed a lot in Q4 that year when we launched, and we actually accelerated our growth 10% to 15%, I think 15% in Q4 2024. So that's why we have a pretty tough comp as we entered Q4. Despite that, we managed to grow faster than 15% at the end of the year, so let's say, December here. So faster than 15% in December, and this trend continued into 2026. That means we are growing faster now than we did before Keeta entered the market in Saudi. And we have done that without any material downgrade to profitability. Our expectation is that we're going to grow in Saudi this year in terms of profitability. So overall, I think it's incredibly strong signals that we have there. And we have achieved this not by doing massive discounts and vouchers and entered into the price war. And it's very easy to kind of get dragged into that. That's not what we have done. But we have actually rather focused on our best customer and continuously working on the service and the product offering that we give to them. And that's why we see that we haven't lost any of our good customers. The only customer that we have lost have been very low-quality voucher-driven customers. And therefore, we are incredibly excited about Saudi and, yes, we see a very good development for us. When it comes to impact from regulatory, of course, if someone has to start making economics because you cannot do predatory pricing anymore, so therefore, you would see an impact. If someone starts adding different fees, they have to start charging restaurants, they have to start charging consumers and so on. So of course, it becomes a little bit more level playing field. And of course, some of those, let's call it, fake customers or empty orders, those will disappear from those other platforms, which means that, technically speaking, yes, we will have gained share. But again, we don't consider it share gain when someone lost an order or a customer that wasn't really a true customer. So from that point on, we focus rather on our growth. And outside of Saudi, I think the other markets have learned from the negative experience that Saudi had to go through that is hurting the restaurant ecosystem and many of the technology disruptors got disrupted. So I think the rest of Middle East learned from that experience and were much faster in applying and adopting predatory pricing practices, and that's what we also see then in the most of the markets that we operate. So in the majority of the markets in GCC have applied that. And yes, I think, overall, we view it pretty positively for the industry and the restaurants and the full ecosystem.

Our next question comes from Marcus Diebel with JPMorgan.

I guess I have a CFO question. Clearly, the free cash flow, EUR 200 million is a strong message. My question is how should we think about 2026 in terms of the cash flow? I think previously you commented that cash conversion should be better in '26 than '25. If I just say, okay, the sort of single-digit percentage growth, I mean, EBITDA gets us to roughly EUR 945 million. Would you say we still have a sort of like EUR 600 million, EUR 700 million gap between EBITDA and cash flow? Or do we sort of like factor at least a meaningful improvement also in there? I appreciate it's not guidance time, but any sort of like conceptual help would be quite useful, I guess.

So I think I gave a bit of soft guidance already around that, right? And overall, I think we think a level above EUR 200 million is also what we would see for the current year. And again, we can go into a bit more detail in about a month's time, right? But I think the way to think about it or the factors that would be driving it will continue to be some of what we've seen this year, right, which is to continue to actually work on, in particular, working capital improvements. I think we've done a lot already. We have improved tremendously in 2025, inventory management, in particular, cash conversion cycles in the Dmarts, we've been able to negotiate improved payment terms with payment service providers. We're monitoring payment cycles much more closely. So again, a lot of improvement has materialized already, but I think there's still more to do, right? So I think there's still some of that also happening or continuing to happen in 2026. Obviously, any kind of overall improvement in the business will also translate into free cash flow. And I think then on the counter side, we obviously then also have investments that we've talked about, in particular, in the Quick Commerce segment, and that would then have obviously repercussions on the CapEx and the lease picture in particular, right? So I think you've got these 2 movements kind of maybe not fully offsetting each other, but I think leading to dynamic where you're probably looking at the numbers we so far gave for 2025 as well as 2026.

Yes. Okay. So basically, if you say EUR 945 million EBITDA, so the sort of incremental EBITDA should come through a better cash conversion than '25, or even better, let's call it like this?

Yes. But again, I mentioned other effects as well, right? The investments, I think, you have to factor in. So again, you have a number of moving pieces here. Some of them are -- will increase your cash flow. Others will slightly decrease it as we invest more. So I think there's a number of checks and balances here.

Our next question comes from Joe Barnet-Lamb with UBS.

Excellent. So you've spoken about the broadening out of your service and movement to being the Everyday App. You also specifically state your desire to raise Quick Commerce GMV to EUR 10 billion and to invest in IV. Can you give a little bit more color on IV? Can we expect it to remain breakeven with you investing incremental adjusted EBITDA into it? Or is it likely to get dragged back to negative adjusted EBITDA? And sorry to push a little bit further on the cash conversion question, but it's sort of where partly where Marc was going, I think. Like are you going to expand your store footprint? And what's that going to mean for CapEx? A little bit of color around that would be helpful as well.

Maybe I'll start and you take then. Yes. So the plan is to -- and we've taken it to profitable, and we will maintain it there. But the growth that we're having is, of course, adding a lot of positive profit contribution. And that portion, the incremental profit contribution that has been generated will go back to expand and grow. But yes, we will keep it still around or slightly above EBITDA for 2026. And then maybe you want to ask the cash flow conversion. Marie-Anne?

Yes, sure. So yes, I think the short answer is, yes, there is obviously plans to further invest in the business, in particular in the Middle East. And that means Dmarts additional ones or looking at expanding Dmarts at locations that are working very well. So you will see additional investments and what that means for CapEx as you probably have a bit more of that. We also had some one-off effects in CapEx in '25 which you'll see a bit less of. We talked about Korea finishing some real estate projects there, right? So again, I think overall, you will probably see CapEx going up a bit. And then I think the lease picture is obviously also important, right, as we expand the footprint of the Dmarts. So I think you should probably look at both of those increasing a bit.

Our next question comes from Luke Holbrook at Morgan Stanley.

I'm going to be the person that asks on your strategic review, just to try and get a little bit of sense here. Is everything on the table, small, medium, larger-sized geographies? And when you say the time line for some of these discussions might be shorter, some others longer, is those longer discussions still within the realms of 2026? I'm just trying to -- try to get more of a framing around how we think about that?

Yes. Very hard for us to comment much around here. As we said in our strategic review announcement, we are looking at a wide range of option. We basically look at everything, from -- without any -- from the ground up, putting it this way, to review what could be shareholder friendly. Based on that, we have also come to some assessment where we think there is value to be generated to shareholders. And we are working very hard and diligently through those potential options. Some of them will be fast to execute and not dependent on others. Others will take longer and/or dependent on others. So therefore, it's hard to give a specific time line on any announcement that will come there. But yes, we are taking a very deep look and we are looking at a wide range of potential options. And yes, that's what I can say.

Our next question comes from Giles Thorne with Jefferies.

Niklas, a question on your [indiscernible] Everyday App. Does it continue to exclude any services around mobility? Or is that something that you could see yourself leaning in harder on?

Giles, so it does not include it as for us building it. But we are, as you know, partnering in some locations and regions with existing ride-hailing companies, to see how we can benefit or how it can benefit our customers to have that as part of our subscription program and also have it integrated into our app, to cross-sell and leverage both our user base as well as improving the stickiness of our users. We are still at, yes, somewhat early stage there to see how much we're expanding on this partnership, to what extent how much it adds value to our users and to us. But we have no plans to expand with our own business at the time.

And just by way of follow-up, the Bolt partnership in the GCC, in the UAE, how is that going? Is there any kind of color that you can share? I appreciate it's still pretty early doors, but any color on how that's going would be useful.

Yes. I think we do see -- we like the partnership. I think there is an argument for extending it or deepening some of these partnerships. I would still say it's -- it could be value accretive, but it's not a game changer. As I have maintained before, there is a clear value in having restrictions to what the brand stands for. Our brand stands for being the best delivery company. And of course, the more you expand into other areas, the more you dilute your message. I want people to think about how do I get something delivered to me and not anything else. And I think that is also the benefit that we've had in many markets and against many players, that we are that focused and that we are also dedicating all our tech resources as one to building that. And there is a lot that needs to be built and improved still. So therefore, we also like to be focused when it comes to our resources on what we're building and what we spend for. But yes, I think there are also some encouraging signs, we see some value, but it's not a game changer yet.

Our next question comes from Annick Maas.

My question is on the AdTech business. Can you just explain us again, how much of the AdTech business is today contributing to profits? And with that, you are today already at 3% of GMV, you're now saying 4% of GMV is the long-term target. Why is that not higher? I think at some point in your history, you had a bit more ambitious targets here. Can you just explain us what is driving this?

Yes. So most of the revenue that we generate that goes to the bottom line, and increasingly so. So of course, in the beginning, when we sold ad products, we had to use sales team members. That is gradually being moved over to automated biddings and self-service, AI-generated sales agents to support. So we see that the margin on that revenue is increasing over time and will continue to increase. In terms of our ambition, I think our ambition was 3% to 5% for a long time. Now we're saying above 4%. I think for the nonfood side, if you look at the groceries, and in particular, when you look at our own Dmarts, we think that level will be higher. So that's maybe what you're referring to. There we see that we can grow substantially above 5%. We are still very early in that phase because we have been prioritizing more on the restaurant side given that it was a larger part of our business. But during [ '25 ] and even more so in '26, we are pushing the NMR revenue stream, so CPG companies and so on. And we think there's a lot of value and money that can be generated and improved there. But we're still very early in the stage. But yes, here, we have bigger ambitions than that. Of course, you can look at things that, okay, if you make that margin that a big part of your profit is coming from there, and you see it as 2 businesses. But of course, it's not 2 businesses. If we would have less ad revenue, we would have to make more money on something else, then maybe we would have increasing our delivery fee or our commission or something else. Because in the end, we have a target on gross profit that we want to deliver. And of course, the more we can deliver through AdTech, the less we have to generate through other parts of the business. So we can charge less to users and so on. So you can't see it as 2 different businesses, and that one is breakeven and one is making money, because we calibrate those together to making sure that we hit our target margins and target profitability. And you can't do one without the other either. I hope that answered.

Our next question comes from Silvia Cuneo with Deutsche Bank.

My question is on the guidance and the FX. Thanks for the color on the outlook for 2026 on the adjusted EBITDA growth front. I just wanted to check, because in the previous commentary around the Q3 stage, you referred to local currencies levels of growth in your message. So I wanted to check if what you commented about today, the up to mid-single-digit percentage growth in adjusted EBITDA is in reported terms for 2026, or is it not? And related to that, if you could comment about the FX headwind that you currently foresee based on exchange rates at the moment?

Sure. Yes. So yes, so with the kind of soft guidance or indication we have today assumes the visibility we currently have on FX. And yes, so that basically is what we see at the moment. I think overall, what we've obviously seen in 2025 is that FX had a very strong impact on our financials, and we talked about that a few times in previous trading updates, right, especially kind of after March 2025. And I think if I look at the overall impact on EBITDA that FX had at the end over the course of all of 2025, it's probably around EUR 100 million, maybe a little less, about EUR 90 million on free cash flow. So there was a very, very strong impact, which was obviously very hard to foresee. I think where we stand right now in 2026, it's very hard to have a crystal ball. I think we don't see right now the same massive impact, but probably there will be some effect, right, and some slight headwind. So in terms of the outlook we're giving, it is currently based on current assumptions, right? And I think as we speak again in March, we would kind of further confirm that.

Our final question comes from Bharath Nagaraj from Cantor Fitzgerald.

How should we think about the timing lag between the higher investment that you're making and EBITDA inflection? Basically, does 2026 represent like a trough year for profitability?

Yes. So there are different types of investments. And you could make investments that would give an instant kind of almost return. For example, if you give a voucher, then very quickly we'll make back that money on that order, that voucher. But there's no long-term positive effect. If you buy a customer, it costs a lot more and it can take a multiyear to get that return back. But of course, it is still a very good return from an IRR perspective even if it takes a multiyear. Same if we invest in technology, it will take time until you deliver that return or if you build a Dmart more, until you have building the volume and so on, it will be a longer payback period. I think the investments that we have structurally done or want to do this year, in particular when we speak about Dmart in the Middle East is to strengthen in our service and operations, product offering and, in particular, with the Dmart in Integrated Verticals and multi-vertical, some of those have very long payback period, but they are, nevertheless, incredibly strong payback period. So when we push multi-vertical, it will -- we will keep investing also next year, we will invest in expanding and improving our multi-vertical offering. Long term, we will have built a business that is worth in terms of billions probably in that space. But there will be also a number of years we'll keep investing in order to get that. So even if the payback period is good, and it's still -- some of these investments will be multiyear investment. The same with Dmart. It took us -- we invested for 3, 4 something years. Now we have an incredibly strong business, but it was still an investment over a number of years until we start seeing a profit from that. So it's a little bit hard to give you now an exact number. There will be returns of it already next year, but there will also be investments happening next year. So that's why you -- it would still be hard to look like-for-like what were the actual returns from the investment this year as they may continue.

This concludes the Q&A session. I will now hand back to Niklas Oestberg for closing remarks.

Many thanks, everyone, for listening in and thanks also to all Heroes for your hard work. We are, as I've said, leaning in during 2026, and it will be an exceptional important year to deliver. So many thanks in advance for an even harder work during 2026. Thank you, everyone.

This concludes today's call. Thank you, everyone, for joining. You may now disconnect.