Flutter Entertainment plc (FLUT) Earnings Call Transcript & Summary

Well, hello, and welcome, everyone. I'm delighted to be joined by Flutter's CEO, Peter Jackson; and by the CFO, Rob Coldrake. Before I begin, I need to read some disclosures. So for important disclosures, please see the Morgan Stanley research disclosure website at morganstanley.com/researchdisclosures. If you do have any of the questions, please reach out to your Morgan Stanley sales representative. So Peter, Rob, thank you very much for kicking off the day, at least in person with us for the track. So great to have you here.

Peter, you referenced in the earnings call yesterday that you ended 2024 with a larger business than you're expecting going into the year. Could you perhaps lay out how the year developed and perhaps where those sources of upside came from, from your initial expectations?

Good morning, Ed. I mean, I think I was particularly referring to our U.S. business, FanDuel. So we found during the course of 2024 that we're able to acquire more customers than we anticipated. You can see that particularly in our iGaming business where we took the #1 spot, where we were acquiring a lot of direct-to-casino customers. We've always talked -- for years, I've talked about the fact that we'll acquire as many customers as we can, whilst therefore, we meet our return criteria. So we want to see paybacks in under 2 years. Actually, across our sports and casino business, we're coming in around 18 months. So we actually -- we acquired a lot more customers last year than we thought. Retention remained very strong. And so we just -- we had a bigger player base effectively at the end of the year.

And you've given the existing state guidance at the Investor Day in September. When you think about the parameters of that, what are the, I guess, potential drivers of upsides you can see there? And perhaps within that, you could comment a little bit on where is market competition, where do you sort of see FanDuel position versus the other players in the market right now?

Well, in terms of FanDuel's position in the U.S., I mean, we're the biggest. We have $1 billion more revenue than anybody else in 2024. In terms of the market dynamics, it's feeling -- look, it's very competitive. And we shouldn't shy away from that. But it's feeling much more rational. We've had -- when I look back to previous football season, there's always been -- it felt like there's always been someone out there that's spraying money around. This season, it felt much more rational. We obviously always run our business in a very disciplined way. We look at all our marketing costs. We don't sort of pretend that chunks of that relate to brand and it doesn't get included in our acquisition costs. When we're trying to calculate our lifetime values, we do it predicated on what we're seeing customers doing now, how we hope the hold will change or customer behavior will change. So we're very realistic with our sort of calculations. And we've acquired as much business as we can. And there are periods where we could see people doing things that we just -- we knew that if we were trying to run that playbook, we couldn't make any money. And they were definitely therefore, not going to be making any money. But we see less of that now. So I think the market is much more rational. In terms of the parameters and our ability to meet the guidance that we talked about at the -- in the Investor Day in existing states, the main drivers of it really are a function of how the cohorts perform. When we look at the business and we model it internally, we take the individual cohorts of customers we acquired on annual basis and you've seen -- we shared with you the analysis, you can see that the value of those cohorts grow in time. You layer those on and that's how we build our business. Well, what we see is that as margins improve through things like increased parlay penetrations that can drive improvements, we can see changes to customer frequency, we can see additionals of cross-selling. So there's a number of factors which can improve the lifetime value of the customers, which obviously will contribute to the upside.

One of the things I might be perhaps surprised about if I think about where business started to where it sits now is you had a very strong focus on a single brand in the states. You've had, I guess, for a period of time, there was FOX Bet running as well, but you've also had opportunities if you wanted to, to make PokerStars sort of a secondary gaming-led brand, and you've not taken those. So could you perhaps talk a little bit about why you're so focused on single brand in the U.S., which is different from some of your other international strategies? And is that a matter of market stage or is that sort of pretty permanent outlook that it's the right thing for this market in these circumstances?

You're right, Ed. I mean, we do run different strategies in different parts of the world. If I look at our business in the U.K., we run a very broad range of brands, the same in Italy. The U.S. market, we are effectively running behind the FanDuel brand. Historically, we've had TVG. We had the Betfair brand, PokerStars and a number of different brands available in the market. We found that the FanDuel brand really resonates to that mass market, recreational, super casual depending on how you want to describe it, customer franchise. And so at this stage, we haven't seen any need to deviate from that playbook. It's been very successful for us. I can remember having conversations with people a couple of years ago, wondering whether the FanDuel brand would ever get there in casino. Our research gave us confidence it could. We just knew our product wasn't where it needed to be. We sorted the product out, you see the benefits of that now. Look, it's not a religious thing for us that we will only have one brand in each market. And if the dynamics change, we reserve the right to change our minds.

I want to come to the U.S. guidance in a second, but one more on brand, if I could start with. I think -- when you took over the job, I think a lot of the discussion around brands then was around challenger brands. I mean, you've always had this clear sort of interest and sort of focus on. Do you think FanDuel can be or can act like a challenger brand when it is the sort of distant #1? And how do you try and make sure it behaves like one if that's the right way of saying it from the way you try and run the business?

I mean, it's a -- the biggest concern I have for us as a group globally is around complacency. And so it's something that I talk to the team a lot about and making sure that we maintain that sort of customer focus. I mean, that's on -- what do I mean by it if it's a challenger brand? The opposite of a challenger brand is being an incumbents and incumbents do today what they did yesterday, and they hope they'll be here tomorrow. I mean, hope isn't a good strategy. We want to be obsessed with what our customers want. We want to make sure that we've got advantaged economics. We want to be absolutely sort of ruthless in making sure that we should challenge our decision-making and so doing the right thing for the business every day. It's not dissimilar to what a lot of others have -- how other big businesses describe it in different ways. But it's really important. And I think in our business, it helps that we have a different business we're competing with in almost every market. Here in the States, of course, DraftKings is our #1 sort of enemy and they are the people we want to beat every day. We've got a better product than them. We want to make sure that we beat them on everything that we do. That's different in our business in Australia. It's different in our business in India. And so I think it forces us to be sharp. But from a subcultural perspective, the challenger mindset is something that we talk a lot about, keeping and installing that in the business and part of it is how we organize ourselves and giving people the freedom push decision-making really close to the customers. And thankfully, I don't get to make many decisions a year. I can ask lots of questions. I've got great teams who themselves are pushing decision-making to close their customers in their market. If I talk about football, most people in the audience are thinking about different shape or to the one that you'll think about. So it's a slightly right example, but you've got to be really cognizant of what your local customers want. There are different broadcast go-to-market channels and strategies and all those things.

So turning to guidance, Rob, I guess, as analysts, you'd already predisclosed and preannounced numbers in January. So a lot of the focus yesterday was in the outlook. Could you perhaps talk through the approach you took to setting the U.S. guidance, and what the puts and takes were about how you see the year ahead for 25?

Yes, sure. So I think the starting point for us is how we exited 2024. So as people will know, we had some slightly adverse results to the book in Q4 driven by the NFL. So we've essentially normalized the 2024 base. So the U.S. profit -- the reported profit of circa $500 million became more like $800 million. And we adjusted revenue accordingly. As we laid out and sort of guided for 2025, when we did the Capital Markets Day, we said that we'd grow revenue between 20% and 25% for existing states in 2025 in the U.S., we're right in the middle of that range. Now we said we'd continue to drive operating leverage through this year and have a 5 to 6 percentage point margin accretion. And we're, again, back in the middle of that range as well. That includes the first couple of months trading for the year. It includes how we're thinking about the momentum that we've got for 2025, which currently you feel quite pleased about.

And this sort of 5 to 6 points of margin expansion in '25, where does that operational gearing from? Is it largely sales and marketing? I think sales and marketing is already at 20%, which is pretty comparable to the U.K., for instance, maybe a bit above some of your other international geographies. So how does the P&L behavior or how are you expect it to behave to drive that operating leverage?

Yes. Again, I'd come back to the longer-term targets that we set out for 2027 at the Capital Markets Day where we said that we were going to achieve leverage in cost of sales, and you've got a long-term target there of 53.5% to 55.5%. We will see some leverage through cost of sales over time. There's bunch of stuff that we're doing around OpEx. One of the things that we talked about at the Investor Day, again, was some of the big transformational projects that we've got across the business. So not just in the U.S., but in our ex U.S. business as well, where we're transforming the PokerStars business. We're actually replatforming the UK&I and Sky Bet business onto the UK&I core platform this year. And then we started to really see some cultural lean into costs in the U.S. We will continue to see that marketing leverage. We saw a good -- few points of momentum in that in 2024, and we'll continue to see that in 2025.

One last one. On the Q4 adverse sports results, I think you talked about the overall sports impact being roughly $300 million impact to EBITDA. What do you say to investors who are concerned having seen 2 Q4s in a row where there's been adverse sports results? Should we think there is a kind of concentration when it comes to NFL or sort of an asymmetry in terms of upside, downside when it comes to NFL? Or should we hope one day there's a Q4 where you do sort of a 13% net revenue margin and there's a $300 million or $400 million beat maybe? Do you have any view if there's anything structural you need to think about the way you think about structural margins or anything like that?

Yes. So the first point is we're incredibly confident in our pricing strategy. We think we've got the best team and the best pricing strategy in the sector. And I think that's been demonstrated over time, and that's demonstrated by our market-leading margins. And in the long term, we'll win on that basis. There can always be some volatility in the short term, as you rightly pointed out, in NFL, in particular, given it's quite a short season, there's concentration into NFL. And there's particular concentration into a few games of the NFL in a weekend given the Thursday night game and the Monday night game. So there'll continue to be some volatility around the NFL, but we're comfortable with that. That's what we want. We're the market leader in terms of parlay penetration. We're the market leader in terms of structural hold. I think a good example around how we're comfortable around sports results and how they can fluctuate is from the English Premier League. So prior to 2024, we've had 2 quite customer favorable quarters for the Premier League in Q4. In 2024, we had an incredibly book favorable result for the Premier League. So we are in that sector where you will see some volatility in results. But ultimately, we come back to the fact that we've got absolute confidence in our pricing strategy, and that will help us prevail in the long term.

I mean, thank goodness sports is inherently unpredictable, right? No one would want to watch it, people definitely we would want to bet on it.

That's true. And I've enjoyed the demise of Manchester City from a personal perspective as well. So can we perhaps switch to product. So 2 areas I want to cover. First of all, Your Way and then second of all, live betting. Your Way, I think it's fair to say, is probably the most heavily trailed products you've had for a while. Perhaps it's just the timing of the Investor Day, but it seems like it's something you're very excited about. You did quite extensive, it seems sort of beta testing around it. And now on the call yesterday, you said you've now rolled it out to all the states. So could you sort of talk about how it's landed versus your initial expectations and what your sort of hopes are for that product?

Yes. I think it's possibly wrong to call it a product because it's so fundamental in terms of the work that's required to introduce it. And let me elaborate a bit on that. I mean, it's almost a different genre philosophy in terms of direction we can take the business. Historically, most bookmakers would have a sort of hierarchy of event market selection and sort of price those and offer them to customers often in that sort of structure on the products themselves. And it's quite limiting. It restricts the combination of bets to make and we solved some of that problem ourselves when we identified how to resolve positive and negative correlated events in the same game. But what we've done with Your Way is a very big lift from a foundational perspective. Instead of tracking 600 markets in a game, we've created a new sort of pricing language, we've had to develop called [indiscernible] and we run a much effective and infinite set of markets on that. And so the technical complexity with that is very complex to deal with and to make sure that we can understand the pricing accuracy in each of those sort of almost infinite of cells that become available and then how you manage the risk associated with that. And then actually, the third piece is how do you present and market merchandise that to customers because you could actually overwhelm people. We're all aware of the sort of customer heuristics where if you give people too much choice, they don't choose anything. And so Your Way has solved all those problems. We've resolved the pricing complexity. We've got on top of the risk management piece. And we're starting now to trial some of these experience stuff. So what we saw with the Super Bowl and the deployment of Your Way in that event on a separate tab in the app without any of the sort of generosity being bound to it that you traditionally say, 5% of our customers used it. And we're talking that 90% of the bets they placed were unique bets that they couldn't have got any other way. Now there's some really cool features in it, the sliders that allow people to sort of refine very accurately the yardage they want, the enormous numbers of legs that people combined. And it's going to allow us to create very different products that sort of sit on top of this new foundational layer for us. I think it's very difficult for other people to replicate. I think it's certainly not a service you can buy from a third party at a surprising fee. And I think people without scale and infrastructure will really struggle to replicate it. So look, we manifested it in one way through the NFL. We're actually utilizing it in our U.K. business as well. So our soccer pricing is now powered effectively by the same capability, and we've got some -- we're trying some stuff on the Betfair product, and we've also got some other concepts we'll bring to market soon. So this is going to be something which is going to last a long time. I can remember being in Australia when Sportsbet launched the multi revolution in 2016 -- in November 2016 when we did it. And here we are all those years later, and we're still evolving what we now call the parlay. I think this Your Way concept will have similar longevity, and there's going to be an enormous number of different variants to drive from it. The impact you can have around live betting, for example, is very profound, right? When you're watching a game and some unexpected set of circumstances emerge, we will have all of the markets and prices available for those unexpected outcomes, available immediately for customers to bet and be able to present to them in a very compelling way. So I think it will transform customer engagement, I think it will supercharge our live betting and a bunch of other things that we don't yet know.

I guess the other one, you mentioned the same game [indiscernible] in Australia in 2016. I sort of wonder from the outside whether there was a period of nearly a year, I think, where FanDuel had the same game probably to itself in the U.S. I sort of wonder if that also plays into the leadership in terms of penetration you've had of that product to sort of have it that way. Conceptually, do you think it would help round the edges of some of that concentration we were speaking about a second ago? If you've got the strikers from homes to throw for 300 yards, but some people put do at 280 and somebody would go to 320, should that also reduce volatility and improve your earnings quality ultimately?

Yes, it will. I mean there will still be some concentration because people will pick -- there'll be an anytime touchdown score and market is always going to be popular. But it will allow us to see a greater dispersion around the yards. I mean, it's fascinating to see what customers are doing with it. People are taking the sliders on the number of yards. I mean, it's not available now because the football season is finished, but taking the lowest numbers they can and the betting the overs on it on 20 legs. So just trying to sort of construct ways of trying find an edge. It's fascinating.

And then on live, it's a debate that comes up quite a lot in the States about where levels are for live betting, how they compare to Europe? Often people prefer to very high volume numbers, maybe more revenue numbers in reality. But how does live betting for FanDuel in the States compare to all the other international benchmarks you have? I appreciate some markets don't have live betting. But across the ones that do, where do you see it? How much do you think there is real space for that category to grow? Or how much do you think is about product within the category, if you should tell me?

I mean, we are constantly seeing improvements in penetration in all aspects of the business. We're excited about live. I think there's -- I think we start in the best place in the market, and we like to have the best product with FanDuel. I think we do with live. But there's -- we're just referring to some of the things and capabilities you can see that Your Way could deliver for us in that. But it's also some of the merchandising, right? The number of people in Super Bowl who are using the bet tracker, right, which is very useful in that sort of context to follow what's going on and decide to sort of double down or cash out, those are important features and capabilities as well. So I think we've got some good benchmarks as we can look at. And it's about all of the different big -- it's sort of the big 6 really to some extent from a sports perspective that we've got to get live going.

I want to briefly touch on regulation in the U.S. and then make sure we touch on the other half of your business as well. So if I think back to the Meadowlands CMD and what seemed at the time quite big targets, they've sort of been wildly beaten clearly in terms of the way this market has developed in terms of size, states, adult penetration and the rest of it. Do you think -- do you sort of have some optimism that we're at a point where iGaming can accelerate liberalization because that's probably been the one area that's held back? And then second of all, perhaps a very brief comment on the tax environment. There's a lot of states that have considered and a handful that are progressing some sort of measure to increase tax. So how do you see the outlook on both of those sides?

We laid out sort of expectation at the Investor Day a few months ago that we thought in the next 3 years we'd see one new state from an iGaming perspective. And we're going through the legislative cycle which we always do, which leads to the speculation around tax and indeed regulation. We'll see where we get to this year. I think it's a very compelling opportunity for states to drive revenues. And we need to remember that there's a lot of people who are playing these products, both sports and gaming in states where it's not yet legalized. And so I think there's a massive opportunity for us from a sports perspective, improve integrity, I think from a player protection perspective, but principally from a fiscal standpoint to collect the tax revenues. So we're hopeful that we'll start to see tide turn there.

In that sense, what's your view on prediction markets? I asked you this on the call a little bit, but perhaps we can unpack it slightly. I think you sort of said it's an opportunity, but do you see it as something with real risks around as well? I think the AGA has been more cautious. You've obviously got to think about your various regulated counterparties across your whole network. So how do you think about the risk reward when it comes to that debate? I appreciate it's early, and there's -- as you mentioned yesterday, there's a roundtable still to come in later in March, et cetera. But what's your sort of initial view on the risk reward of that sort of outcome?

I think if you sort of cast forward and say, well, let's imagine that it's -- the roundtable allows us to proceed, what does it actually achieve from a customer perspective? I think it allows you in states which have not got sports betting regulated to do something. There's a few things you can look at from a prediction perspective, but it doesn't give you the richness of a fully fledged sports betting platform. So I think some of the revenue expectations and people are probably a bit too optimistic, but I think what it does do is it's part of the sort of -- you could see it being part of the prime the pump strategy in terms of sort of bringing customers on board. You can subsequently then be converted into sports betting if legislation is allowed. So that was sort of the way I would think about it.

Okay. So switching to rest of world. The U.K. performance has been very notably one of taking -- I think, for nearly 2 years now, a lot of market share, frankly. Is that -- are those market share gains sustainable? It feels like there's maybe a bit of a regulatory cycle that's being finally lapped by some of your competitors. Market share in the U.K. is already very high, frankly. So do you think investors should be thinking about sort of holding market share from here? Is it sort of a bit of a phase? Or is there opportunity for further gains? And what's sort of embedded in the way you've thought about the ex U.S. guidance for '25 and '26?

When I look at what we've got coming down the track from a product perspective, I'm very excited to see what we can do in the U.K. market. We were talking about Your Way and bringing that product into the U.K. market, I think will be very compelling. We've seen big benefits in Paddy Power taking the Sisal [indiscernible] product. That's been very successful. So the whole phenomenon of player fandom is as live in the U.K. as it is here. I also -- I think we've migrated the Sky product over, they have access to all of this at the group capabilities, which they haven't got at the moment. And I think there's a lot of exciting things we can do from a gaming standpoint in the market as well. So I'm optimistic about the U.K. market and our ability to continue to grow share.

Picking up on your ex U.S. guidance, I think we're incredibly pleased with the performance of the U.K. over the last couple of years. And I think it's really outperformed. It's got a really solid base. We've got 4 fantastic brands there. I think from a purely financial perspective, as we run through '25, we're not going to see the same levels of growth that we saw in '24 for a few reasons. I mean, one, we had some very favorable sports results in '24, including the Euros. And secondly, in terms of the Gambling Act review changes coming through. Only minimal amount of those kind of landed in '24. So the majority of changes, which will be $50 million to $100 million that will land into 2025 as well. But as Peter said, alongside things like the Sky Bet replatforming, which will give more opportunities in that brand, Tombola is performing fantastically well. We've got lots of more product innovation coming into the market. We're very well set. What will also be interesting will be how some of the kind of secondary and tertiary players kind of cope with some of the GA changes and how that impacts them.

Is it fair to say given that tails more in gaming, that's where more of the opportunity is? I guess your share is also -- will dominate in sports. Is that fair?

Yes.

And Italy is another very big market for you in international or rest of world or ex U.S., whatever your new disclosure is going to put it inside, where you've got around 30% share. I think you're still talking to SNAI completing in Q2, from my understanding. And there's also been some discussion around potentially bidding for the main lottery tender and there's also some discussion in the market around modification or remove of the Dignity Decree, which could change the sort of advertising environment. So potentially a bit of chopping and changing, but obviously, at a starting point, you've got a relatively high share. So can you talk a little bit about the puts and takes for Italy and where you see areas for excitement or where you're sort of -- there are risks you're trying to manage?

Well, I mean, I know you're a fellow bull on Italy. We love the market. I think it's fantastic. Our local team is doing a brilliant job. And I think when I look at the recent performance and the figures that we printed yesterday, the team are doing a terrific job there. Rob, you might want to talk, you were very close to the Italian market.

Yes. I mean, it's an incredible market, as Peter said, if you look at the fundamentals of that business and how Sisal has been performing. So when we acquired the business a couple of years ago, it was doing roughly 400,000 AMPs on a monthly basis. Peter and I were in Milan with the team a couple of weeks ago, and they're very close to touching 1 million AMPs. So in the space of just over 2 years, it shows the phenomenal growth within the online business. And what we've seen also is the retail business out there has been reasonably stable. Italian culturally is quite different, but retail is still quite big in the Italian culture. I think the addition of Snai, we're very excited about. Hopefully, we will get that over the line in Q2. That will put us back into the kind of gold medal position in Italy. We're very excited about what we can do with Snai from a product and team capability perspective. Our Italian management team know that business very well. And that's also a very compelling. And I'd say, in the context of delivering synergies, I'm very confident about the Snai synergy case as well. So lots to be excited about.

It's another market where we're taking the Parlay product to Italy and it's having great traction in the market.

Yes. Brazil is another one. I think it's quite difficult for investors because it's quite an opaque market from the outside. Obviously, there was a liberalization of the market in January. You're there with Betfair and with PokerStars predominantly right now, but obviously, you've got NSX, which is due to close. I think you said this well in Q2. [Soccer] season begins in April, I think it is. So you're hopeful you can sneak in before there, I would guess. But can you just talk from this insight you can get from your existing business, how do you think that market launch has gone in general terms? And then perhaps you could talk about what your hopes are for NSX where you again mentioned on the call, reiterated on the call that you're investing, I think, up to $100 million in losses this year to grow that on a J-curve?

Maybe I can start and Peter can comment as well. But I mean, the first thing to say would be the Brazilian market is very exciting, a population of 200 million people, soccer mad, enjoy betting. There's already kind of an existing gray market there, if you like. So we're very excited about the market and our ability to be able to win in that market. And as far as the licensing regime goes, there's lots of companies that have applied for licenses, initially up to 200 companies, we believe. We think the market will shake out quite quickly. I think in terms of our aspirations in Brazil, we are continuing to -- we'll lay down circa $100 million throughout 2025. We expect the business to grow healthily. NSX is already performing very well. I think with our Betfair brand with some of the changes in regulation, we've experienced a bit of friction, but we're working through that. And actually, over time, I think the sky is the limit in Brazil. And we've got a very well-formulated playbook that we've rolled out in the U.S. in terms of how we invest behind new states. So we've got a very good and well-tuned strategy in terms of how we'll lay down investment. And ultimately, in terms of when we inflect to profitability in Brazil, it will be a function of how big we can actually grow that business. If we continue to see compelling returns and paybacks within our guardrails, we'll continue to invest behind it.

It's interesting to see more international businesses being -- it's obviously very different to the U.S. case, but it's interesting that your investment strategy looks like it's maybe mirroring it a little bit more where if the returns are there, you're willing to invest into losses to grow the business more substantially, whereas I think a lot of international businesses have sort of just been growing along on a margin doing that way. It seems a bit of a...

Historically, that was our strategy as well because we couldn't always afford to invest -- to take the business into a loss-making position to build a bigger business subsequently. But I think what we're seeing in the U.S. is how important it is in the early days to pick up as much business as you can. Brazil is different because it's not one of those markets where you're going to suddenly get a whole wave of customers come straight into the market. There's been a lot of people who've been betting in the market already. But we'll be focused with the NSX brand into that sort of mass recreational place and acquire as much business as we can.

One more I want to squeeze in before we run out of time is just on M&A, to sort of follow up on that. We just talked through Italy, just talked through Brazil. I think Flutter is 2.5x larger than your nearest competitor globally by revenue. And I think what distinguishes it for me is both the intent and the balance sheet capacity to continue to conduct sort of global M&A. That's where it feels sort of most differentiated. So what's the key things you look for? And I'm not expecting you to give the deals that haven't happened, but the deals -- what are the things you don't look for or you're trying to avoid when you're looking because you clearly must have a lot of opportunities that come to you. Where is the focus and what you're trying to do with M&A?

Yes. Let me give us a macro point and Rob can talk about some of the things we spot in targets. But we are focused on M&A. It's been a very important component, but we now talk about being an end business. We're investing organically in America. We'll acquire as much business as we can in this market, very compelling returns. We'll do M&A. We closed 2 deals in Q2. There'll be more opportunities for us to pursue our global rollout, and we're doing -- and we're also returning capital to shareholders. So I think you'll continue to see us do all 3 things. From my perspective, culture is probably one of the biggest and most important things when we look at targets, we want people who are going to be interested in learning from us because we do operate this devolved model, but we also want to better learn from them. So we're looking for high-quality management teams in businesses that we think when we can bring them our capabilities, we can help them grow.

Yes. I think just to round off that point, I'd say, we're in a great position as far as balance sheet strength is concerned. So this year, we're going to buy back $1 billion in share repurchases. We're going to complete the 2 big deals that we talked about, which is $2.5 billion outlay, and we'll continue to invest significantly behind the great business we've already got. And still by the end of the year, we're going to be within our medium-term leverage guidance. So we're in a good place.

Perfect. We're up on time. Well, now your GAAP net income positive will be on index watch over the coming quarters. Please join me in thanking both Peter and Rob for their time. Thank you.

Thank you.