Fair Isaac Corporation (FICO) Earnings Call Transcript & Summary

All right. Let's just get started here. Good afternoon or good evening to our U.K. listeners and good afternoon exactly to our North America listeners, except for Will, good morning to you, Will. For those of you who don't know me, my name is Manav Patnaik. I'm Barclays' Business and Information Services analyst. And we're really happy to end our series of fireside chats that we had in this conference Will Lansing, who's the CEO of FICO. And I think Steve Weber, IR, might be on with us as well. So thank you both for being here with us.

Our pleasure.

Before we get some of the Q&A, just a quick logistical item for the listeners. We will not be doing live Q&A. But if you have any questions, you can e-mail me. And if I can get it in, I'll be happy to do that.

So Will, let me just start with the broader question, which is how and when did FICO really get to shifting the entire organization to this work-from-home situation that we've been forced into? Because on the one hand, it's like, oh, go, just go home, log in to computer, do you work from there? But on an enterprise level, I'm sure it's a much, much bigger list in task.

It's been remarkably smooth, I have to say. I think that like many tech companies, we have a lot of advantages in a work-from-home kind of environment. But if you figure, more than half of our employees are outside of the U.S. We are a global company. We have 40 offices scattered around the globe. We've been operating virtually for a very long time. And this isn't -- we've been at Zoom before, we were doing zone before COVID. I would say that the use of it has gone way up. But in terms of the way we operate, it has not been a tremendous challenge for us to switch over. In fact, like some other tech companies have reported, our productivity on the engineering and software side is up. I think you get rid of the commuting and find a little more time for people, and our productivity has gone up. So it's been -- that part has been good. I think the hardest thing is for the salespeople, who value customer in-person contact. We have to be a little more careful about how we engage in business development activity. And for that, I think we're -- we have a little bit of a -- little bit of a network focus in the sense that we have a studio, we have a look in the field and we try to make the presentation uniform. But broadly speaking, been very smooth.

Got it. And just out of curiosity, you obviously have your cyber Score business going and there's a lot of press around the cybersecurity risk because everyone remotely logging in from home. Has that -- have you seen any of those kind of trends as part of your own business? Or does that maybe help your business there?

Well, as you know, that's a very small business for us. So it's not material. It's not going to move the needle. But yes, I think there's increased scrutiny for sure, not just us, but every company is increasingly focused on what are the things that can go wrong with people working from home. Again, as I said earlier, we've been doing this for a long time, and so we have our protocols in place and our security is pretty tight.

Got it. And in terms of the finance organization, I think you guys, the Board, Mike, everyone probably has a downturn playbook always handy. But I think it's fair to say nobody really planned for this kind of an abrupt shock to the system. So how quickly were you able to flex those points there?

That's a great question. So of course, the first steps we took were operational. How do we make the work-from-home environment work? And we've done that and it's really smooth and seamless and working. And will it have implications for how we do business in the future? Probably. I think we'll allow more remote work, we'll encourage more remote work, where possible. So that was -- the first step was the operational side of it. Almost simultaneously with that, we started to do the sensitivity [Audio Gap] area analysis. But we have lots of data and lots of experience. We have prior downturns. And so we spent a lot of time thinking about what would the impact on our business be, what could it be. And we've gotten that largely right also so far. And that was -- and obviously, the Board very focused on that, our senior management team focused on that. Our communication internally has actually gone up quite a bit. I mean what we're seeing is higher morale scores and better scores for things like communicating with our employees because we're spending so much time explaining where we're going, what we're doing, how we're doing business. So that's gone very smoothly. I think the question -- the bigger question is, what's really different in the way you run your business in this kind of an environment? And because we have the good fortune of having a very strong business, which, it's not immune to the cycle, but it's a very strong business. We are in a position to continue with our strategy. We're able to continue to invest, to continue to build the products that we're building, to continue to focus on building up the platform, and that hasn't changed. That is all -- that's proceeding as it was, and we haven't like cut back because our backs are against the wall. We don't have any of those kinds of situations. So I think we're still taking very much a long-term view. We've never been a quarter-to-quarter company, and we're not now. I believe that the winners who emerge from this will be the ones who are able to take advantage of this time to invest even more and really make things happen. Are we more aggressive about our plans? Probably, probably a little bit more aggressive. I think that you know we have this transition going from legacy to the platform. And if anything, I think that we've doubled down and said, let's get even more of our R&D dollars into the platform, into our new growth business. And so that's what we're doing.

Got it. That makes sense. I mean that jives with what Microsoft's CEO talked about 2 years worth of digitization within 2 months. So it sounds like you guys are going ahead with that as well. Just from an operational perspective, a lot of the other executives have talked about structural changes, meaning because of work from home, maybe you have a lot of real estate savings that you can look at, T&E probably declines a certain level permanently. Do you agree with those? And do you see anything else changing just operationally the way you run a company?

Yes. I think the things you just mentioned are the same things that we're all thinking about. So travel is way down right now, and I don't think it will go back to its prior levels. I think that we have figured out that we can be in close touch with our customers with video in ways and internal meetings. There's just a lot of stuff that we can handle digitally that used to involve getting on airplanes. So I think there will be -- there's definitely reduction going on right now. But I think some of it will persist. So I think that's a change. In terms of work from home, I was -- there's -- we've had a change because I was one of those guys, like Marissa Mayer, who told our employees, look, I want you in the office, it's not just about the work output, it's about the collaboration. We need you in a team environment to get the full benefit. And so please come to the office. I was not a fan of work from home. We always had some work from home because some of our people are remote, they're not close to an office. But I encouraged that come into the office. I think we've discovered that this is working so well that I've certainly changed my thinking. I'm much more relaxed about it now. I think it's going to be more of a personal choice. I think that our employees, some of them are loving work from home. And they think, hey, if I can cut out a 2-hour commute every day, I am really a happy person, and can I continue this? And then we have other employees who missed the comradery and the collegiality and can't wait to get back to the office, who knows what pressures they have at home and they want to get back. So I think we're going to see both sides of it. The net of that probably will be a little less real estate. But these are a lot -- we're in longer-term commitments. I'm not sure that it's going to have any material impact in the short term. Over the longer term, I'm sure that our real estate needs will be lower than they otherwise would have been.

Got it. Makes sense. Okay. If you can just dive into the segments and unsurprisingly, let's start with the Score segment. Firstly, from just a macro perspective, you mentioned on the call, you don't really see the real-time data like the bureaus do. And so just as a clarification for the audience, why is that? And then secondly, is it fair to assume what Equifax, TransUnion, Experian tell us is kind of how the volume levels will work on your end as well?

Yes, absolutely. So mechanically, the way it works is the lenders, the reporting institutions report to the bureaus, the bureaus have the data, and then when a score is requested, it is generated in real-time by the bureau and returned to whoever requested the score. The algorithm, the scoring algorithm is actually -- it resides at the bureau. And so the bureau has the real-time data. Then we get a royalty payment from the bureaus in arrears, and that could lag by 4 to 6 weeks. And so we are -- in that sense, we're a lagging indicator. Which leads to your next question about -- as the volumes go at the bureaus, is that a good proxy for the volumes for FICO? And I think the answer to that's yes. Not exactly the same, but close enough. I think for approximation purposes, that's right.

And I guess would you -- in terms of the mix differences that impact FICO, B2B Scores specifically, is there any nuance to you guys being more weighted maybe towards cards versus mortgage versus what the bureaus usually talk about?

Yes, there is a little bit more nuance there in the sense that what you'll see -- what you can divine from the bureaus are the volumes, but our revenue is not tied exactly to the volumes. We obviously make more money in mortgage and in auto than we do in prescreen and credit cards and that sort of thing, account management. And so volume is not a perfect proxy.

Got it. And so maybe if you can just give us a flavor of how the Scores volume reacted in '08, '09? And perhaps if that's a good proxy or what are the differences we need to consider today?

Oh, I think things are very different today. So what's the same is lenders are concerned about creditworthiness. They're raising the standards for granting credit. They're scrutinizing it carefully, so that's the same. Although I would say today, they're doing it much more surgically. And they have much more sophistication and many more tools and data and understanding to make these decisions in a better way than before. So it's not quite the crude and blunt instrument it was the last time around. The other thing is, the banks are in much better shape this time around than they were the last time. Last time, they were really pressed. And since then, their capital has come up, their -- they have stronger balance sheets, they have better tools at their disposal. And so I think that the impact on the banks will not be what it was the last time around, it will be much lower. And of course, you have the central banks and Fed leaning into this. So I think that part of the environment is quite different. And what it means for us is, back in 2008, when banks were under tremendous pressure, they cut their IT spending, they cut their capital budgets, that affected our software business. So suddenly, a whole bunch of business dried up. And we -- 80% of our business is financial services and if financial services are hurting and they cut their IT spending in half, that has an impact on us. We don't see that happening this time around. Obviously, companies are being careful and scrutinizing, but the solutions that they are putting in place that we provide, they take a long time to think through. These are multiyear kinds of things where they think through what do they need and they develop a plan for installing it, and it's a 250-day sales cycle. It takes a long time. And so that hasn't changed a whole lot. That we see continuing. We think our software business will be pretty resilient from that standpoint. A little bit of revenue fall off in software from volume things, where there's just a little less volume, but not huge. So I think those are the big differences. The banks are stronger. Our software business will, therefore, be better than it was the last time around. And the scores, actually, the scores -- people are paying more attention than they ever have to scores, and there's more need to monitor than ever.

Got it. And just tied to your pricing strategy that you started in 2018. Yes, banks are probably in better shape, but they'll still feel kind of the volume hits, and there will be some curtailment of activity. Does that environment then kind of hold you back or take a pause on your pricing until maybe they start feeling better?

With our pricing, we believe that there's a tremendous value gap between what we charge and the value that our customers get out of the score. We think that gap is enormous. And so that delta doesn't change very much in good times and bad. There's a big gap there. Now that said, we are cautious in our pricing increases. We are thoughtful about where the impact is not severe for the lenders that buy those scores. And I don't see that changing very much. I mean I think that we'll continue to proceed on our plan to try to extract more value there. But I don't see tremendous change, no.

Got it. And Will, this is your first time at the "London Conference". But just for background, what happened or what changed to start the special price strategy in 2018, if you could just give us a little color and framework to start there, please?

Sure. Well, if you go back in time, we've been in the Scores business for 40 years -- 50 years. If you go back to the late '80s, we introduced our first bureau score general across the industry bureau score. And then we introduced scores with all the bureaus. And over time, we became something of an industry standard. And all of our scores were sold through the -- still, for the most part, are sold through the bureaus, they are our distribution partners. And none of that has changed. That's the same business it was 30 years ago, bigger, stronger, but same business. But our ability to modify prices has changed. So we used to have -- we didn't raise prices for 25 years in the Scores business. We had the same price for 25 years. Starting about 6 or 7 years ago, we said we ought to be able to get cost of living increases. We ought to be able to get a little bit of price each year. And so we started to do that. And then we had a little more sophisticated and looked at pockets of our Scores business where we thought that the value gap was just too big and that we ought to try to reduce that gap. And so we got to do that. And so I think what's changed is we're contractually able to change prices, and so we've started to do that. As I said, we don't want to shock the system. And so we talk about small increases each year.

Got it. And so can you just talk about the tiered strategy that you took? In '18, you went with mortgage, in '19, auto, this year, it sounds like it's a card portfolio. Why not all at once, I guess?

That's a good question. I suppose we could do it all at once. Our team focuses on different parts of the business at different times. We don't look at every single score every single year. We look for where those gaps are biggest, and then we go and we address them, we think about them. It's not quite as organized and regimented as -- year 1, we do mortgage, year 2, we do auto. I think we look at it a little more holistically. And certainly, when you get beyond mortgage and auto, it's harder to characterize our scores as being the same. It's not one segment. It's really hundreds of segments of scores. We try to just think about each pocket, and where is there higher and where is there lower demand elasticity, that's really how we think about it.

Got it. And mortgage and auto, clean, simple, vanilla, call it, price increases. And this year in card, like you said, it's just -- it's maybe 100 different subcategories. But can you give us a flavor of what the thought process or how we should think about where the pricing mechanisms were in the adjustments made this year?

We don't go into a lot of detail there. And every year, you should expect it to be a little different. There's not a formula. It's -- we have a pricing team in our Scores business, and they evaluate where the greatest potential is. Our goal is to not have dramatic changes that shock a system. Our goal is to do things very gradually and continuously.

Got it. And so I guess would it be fair to say that the price increases you've taken over the last 3 years have been, in your view, I guess, moderate, i.e., not shocking the system, and that's the level that we can expect going forward?

I wouldn't commit to the same size increases category by category. But yes, I think the way you characterize that is accurate, which is we didn't think that they were a shock to the system when we did them, and we would anticipate not shocking the system in the future.

Got it. And can you just talk a little bit of the customer reaction? I mean, clearly, the prices have gone through. So whether they reacted or not? They're paying for it. So that's the most important. But just how they think about -- I mean I think we agree with you in terms of the price-value gap between your score and the price being paid. But was there a lot of pushback? How did you deal with those elements?

There's so much value in what the lenders get. And it's part of a bundle, it's the score, it's the credit report, it's the bundle that they get. And there's so much value there that I think the opportunity continues. The -- I think that the bureaus, they mark up our scores. They incorporate our scores into the bundle. And so I think it's good for them also.

Got it. And you talked about the tremendous value of the Scores business and I think we all agree with that. But just out of curiosity, I mean most of your scores business is still U.S.-centric. Why is it that you think you guys can't replicate the same thing in other countries?

Well, a great question. And obviously, we've thought a lot about it. Every country is different. Some regulatory schemes don't lend themselves well to scores. For example, there's positive data and negative data. In some jurisdictions, the good behavior payment history, the regulators don't permit that to be reported, but they do permit negative judgments to be reported, not as useful. So it depends on the jurisdiction, whether there's even an opportunity. Then it depends on kind of how that geography has evolved. Is there already an incumbent that owns the market? Or is it open? What we're seeing is a couple of things. One is, wherever you have emerging economies, wherever you have countries that are trying to build a consumer credit industry, there's an appetite for scores. And sometimes we can meet that. And so we are busy trying to -- we're busy trying to put our scores in place where we can. We have things going on in China. We have things going on in other jurisdictions. It takes a long time to build the scores business. It's a multiyear effort, and it just takes years and years. I mean the U.S. business took 35 years.

Got it. And back to the U.S., obviously, we think of FICO as kind of the benchmark score, right? And once you're a benchmark, you're embedded, you don't go away. Do you think the FHFA ruling to try and evaluate other score alternatives is going to make an impact? Can you just talk about how you think about that development?

We'll see how the rulings come out. We'll see how it goes. In every other market other than with the GSEs, our scores are bought completely voluntarily. There's not a requirement that you use our score. We think that across the board where people securitize their lending and look for a secondary market, there's an appetite for some kind of an index by which to measure the creditworthiness of the underlying paper. And so we're fairly comfortable with the position that we occupy for that purpose. But if -- we'll see how things evolve there. We'll just have to see how things evolve.

Got it. And before I touch on the direct-to-consumer piece. We've obviously heard of UltraFICO, FICO XD, a lot of innovation there. I mean in the B2B segment, is it really just going to be about lending volumes and the pricing in scores? Or are there other areas we should keep an eye out on that could contribute here?

We have -- we're always looking for opportunities to demonstrate innovation in this business. And most recently, we've come to focus on -- we've just brought it to the market, I think all the FICO Resiliency Index. And what that does is it helps lenders to understand at any FICO score, at any given consumer, whether they are more or less resilient to an economic downturn. And so we're -- it's in beta with a bunch of lenders right now. And we believe that, that's going to be a big deal.

Got it. And then just the direct-to-consumer business. First, just as a background, obviously, Experian is a big part of that mix, there's myFICO. Like what is the mix of that business? And then the second part of the question is more, do you think that is countercyclical? Or how should we think of that business flowing through?

So what that business is, for the benefit of those who don't know, is it's a credit report monitoring business, where for a subscription fee, you get your credit report and you get a FICO credit score. And we have that -- we have a captive business called myFICO, which provides that. It provides all 3 bureau scores and reports. And Experian also does the same thing. And we obviously benefit directly when it's myFICO.com. When it's Experian, they're our partner and so we get a royalty. And that business is a very good business. Consumers are increasingly sensitized to understanding the importance of their FICO score. And they're focused on it. And interestingly, in tough economic times, consumers become even more focused on it. And so what we've seen is actually an uptick in our business at myFICO.com. I can't speak for our bureau partners, but we've seen an uptick.

Got it. And then just last one on the score side, on the margin front. Obviously, it's a fabulous business with really high incremental margins. But then on the downside as well when volumes are low, there's high decrementals. And I guess my question is, let's just say things get worse. So even now, like where are the cost takeout opportunities on the Score side?

Well, Scores, as you know, is a high-margin business. It's an IP business. It's a high-margin business. There's not a lot of cost in it. And so there's not a lot of cost takeout opportunities. But as you know, we have a broader portfolio. We have a ton of cost in our software business. And so at an enterprise level, if we chose to, we could make cost reductions on the software side, if we had to. Now I will tell you that we don't feel that we have to. We are investing as heavily as ever in -- particularly in our new platform software business. But if it's a viability kind of a question, the point is there are ample cost takeout opportunities, they would slow our road map on the software side, if we were to take them.

Got it. And before we get into the software business, Will, I mean I think sounds like you're a lot more optimistic and in control today, which is, if I look back '08, '09, it took you guys a good 2 years or so before you got into that buyback program, for example, like I think everyone was shocked. Is that a fair characterization? And I guess to your point on the cost will come from the software side, like what needs to happen for you to start really taking a dig into your cost profile here?

So in terms of the capital allocation and the buyback, yes, we paused in '08, but we were in much more desperate shape back then. This time around, we have not paused. We've continued with our program, which, as most of our investors know, is built around taking all of our free cash flow and returning it to shareholders in the form of buyback, that has continued. We still are engaged in that, we're still committed to that. Our leverage is at a very manageable level. Our balance sheet is very strong. So -- but we don't feel like there's a lot of pressure there. We obviously have done all the scenario planning and sensitivities around what happens if volumes fall off in the software business -- in the Scores business as well as the software business. And we're comfortable with where we are. We anticipate some damage from the downturn. Of course, there will be some less volume. There'll be some damage. But nothing like the last time around. We're in much, much stronger condition than the last time.

Got it. And just on the software business, let's transition to that in the last 10 minutes here. Firstly, people are probably least familiar with the software business that you guys have. So first basic question is, what is the mix, like what sits in that software business? And then while you're doing that, maybe any nuances on how they are better positioned or they just weren't there before in '08, '09, which makes you say that you'll not see anywhere near the impacts you saw back then?

It's a very different business. Back the last time around, we were primarily a licensed on-premise software business with very specific, narrowly tailored solutions for lending institutions, originations, collections and recovery, fraud, line management, things like that. What we've done over the last 7 or 8 years is, a, transition to a cloud business. So now our offerings are available in the cloud or on-prem. And more importantly, we have -- we've unified the IP underneath our solutions in a platform. And so this decision management platform, which we think is best-in-class, best in the industry, this decision management platform has common IP around decisioning, the decisioning engine, the data orchestration that goes into that. All of that is now -- there's now a return to scale that comes from that. And so that's a pretty big difference. As we think forward, what we see is a business -- our platform business, which is growing over 40% a year. I mean it's -- that is our growth avenue. That business will be a bigger and bigger part of our software business. We're not going to abandon our on-premise software. We're not going to abandon our customers who have legacy products, we'll continue to support them. But increasingly, our customers will turn to us with platform-based -- for the platform-based solutions that have kind of AWS characteristics there. It's much easier to turn on to add volume, to add features, the kinds of things that you see with Salesforce or Workday, you can imagine those applying to our new platform business. So that's the future direction. That's kind of where we are increasingly.

And so maybe just on that real quickly, how much of the business is currently on the "cloud?" How much do you think can be on the cloud? And then what time frame do you think we get there?

It's a slow transition. So -- and it depends on how you measure cloud. Because there's platform and then there's cloud. We have some cloud stuff, which is not platform. It's actually on-premise software that we've put in the cloud and we operate either in our own data centers or at AWS directly for clients, and works fine, works great. The future strategy is very much platform cloud. It's all about how do we have people consuming our IP in this kind of -- in a SaaS environment. The transition will be many years because when customers -- when our current customers put in software, it goes in for 6 years, 8 years, 10 years. They put it -- it's a complicated evaluation process, it's complicated installation. And then once it's in, it's really deeply embedded in the operational workings of the business. And so our customers don't -- they don't swap these things out every 2 or 3 years, they're in much longer kind of a cycle. And so we expect that our on-premise software -- our on-premise licensed software will still be around in 3 years, 5 years, 7 years, maybe 9 or 10 years. So there'll be -- there's a long tail there from the legacy side. But you're seeing the new business increasingly on the platform.

Got it. And for a mature software business, generally speaking, I think margins are expected to be high, you guys have talked about generally that you think it's breakeven or close to that. Can you just help bridge like what are the big spending buckets that make the margins breakeven?

Well, the single biggest one is R&D. We run R&D at about 19%, which is high, that's like a growth company. And that's what consumes the profit that you'd otherwise be collecting from the legacy products. So it's a choice that we make to invest this profit -- the software profit back into the business. It is a massive transition. And our ambition is quite large. We want to be the preeminent decisioning platform for B2C companies, period, full stop. If you're a B2C company and you want to optimize your interactions with consumers, you do care about customer journey, you care about a 360-degree view of the customer. If your goal is to make sure that every single interaction with the consumer counts, whether its increased revenue or increased profit or increased lifetime value, whatever your objective function is, we have the software technology and the new platform to support that for all B2C companies. And so we're -- that -- you can imagine the total addressable market for that is enormous. It's all B2C companies. You can think of it as next-generation CRM. And we think that we are the best player in that space. And so we are pouring investment into it. And someday, we'll have the returns to scale. Someday, we'll dial back the R&D, but not when the opportunity is so big and right in front of us.

Got it. So I guess to your point, if you're spending like a growth company, do you think the software business will start growing or sustainably grow double digits longer term, is that the ambition here?

Longer term, for sure. I think that there's a short-term question about, what transitional business do you want to engage in? So we have the growth business with the platform. We have the legacy business with what's behind us. And then there's some in between business, I would call that, where we're doing single tenant in the cloud solutions, where we've basically taken our on-premise software, put it into AWS or put it into our data centers and running it for our customers. That business is a transitional business. That's not long-term strategic in the way that the platform is. And so there is a question about how much of that we want to do. We obviously want to support our customers. We don't want them going to competitors. So if they need it, we'll do it. But the question is, how aggressively should we flog that, how aggressively should we chase that business? And the answer to that is, I don't think that aggressively. I think that we can do some of it. We don't have to do that much of it. And so that's where the difference in growth rates would be in the short term. In the long term, the growth rate will be higher because of the platform business.

Got it. And if you didn't have the Scores business with the higher profitability, do you think your attitude towards spending on software would be different? Or maybe just the speed has to change because you need to fund that?

Wow, that's a good question. And we've often wrestled with it. I mean it's -- the question is, are you better off with the umbrella that we have, with the enterprise that we have where we have slow growth and fast growth businesses, we have high-margin and low-margin businesses. And we kind of have, I don't want to say, we have all the quadrants of the BCG diagram because we don't have a lot of dogs. But we definitely live in 3 of the 4 quadrants. And it's a nice balance. It's enabled us to deliver very, very consistent EPS, very consistent EBITDA growth, consistent revenue growth, it's supported a very predictable and transparent capital allocation strategy, it's led us achieve this kind of slow motion LBO that we've been engaged in. I mean there's a lot of beauty that comes out of all these parts working together. So it's a fair question whether some parts would be more advantaged if they were separate? Or would you be constrained? I have to say that the Board and I believe that this balance is right. We're not busy looking for how to change things around. We think we are reasonably well optimized. It's a nice balance.

Got it. And then maybe just last question to end this here, but similar half choice question almost, which is, over the years, you've been intentional and deliberate and it's been a great choice of just buying back your shares. And my question is more, is there M&A that you see that can accelerate either your cloud strategy or other elements of what you want to do? And presumably, if this recession environment creates some opportunities, would you be willing to get more aggressive there?

Oh, it's an excellent question. As you know, Manav, and anyone who knows me well, knows that I've run other companies in the past, and I've been very acquisitive in prior lives. I mean I have lived in a world where acquisition was the lifeblood of the growth of the company. That is not the case at FICO. I had contemplated, frankly, I had contemplated back when we were a value stock years ago. I had contemplated someday having a high PE and being able to use the currency to go out and build a bigger business more quickly. The reality, though, is here we are with a higher PE. And we still feel like our currency is really dear. It is not something we want to spend easily. Every time we look at an acquisition opportunity, we ask ourselves, do we like that business more or less than the business we're already in? And the answer almost always is we like our business better. There are very few businesses that are as attractive as our own. And there's complete certainty. When we invest in a stock buyback, we're investing in ourselves with 100% certainty about what we're doing. M&A, there's always the risk that it doesn't work out and so on. So it's not that we don't do it. We do look for talent. We do talent acquisitions. We do small technology acquisitions. But they're typically small. We haven't done a $100 million acquisition in many years, and we're $10 billion market company. We tend not to do acquisitions. I would never say never. There may be opportunities. It's always worth looking at. But anybody looking at it is going to have to answer the question, do you like that business as much as you like your own? And please send in suggestions because we're still looking.

Got it. All right. Well, we're just about out of time. So I'm going to end it there. Thank you so much, Will, for being here with us, and hopefully, next year, we can actually do this in person in London and hit some of the regions planned as well.

It is our great pleasure. Thanks so much, Manav.

All right. Take care.