London Stock Exchange Group plc (LSEG) Earnings Call Transcript & Summary

Good morning, everyone. Great. Thank you for joining us. It's a pleasure to welcome you to LSEG. I had the opportunity to meet quite a few of you last night. For those who I haven't met yet, I joined LSEG in July of this year. And given the pace with which we're operating, it really feels that it's been much longer. Just to give you some background, I have 28 years of experience, leading large global businesses in Capital Markets, Post Trade and the Data business. And I joined from Mastercard where I was on their leadership team for the data and services business. Now welcome again, as I said. Great to be here with everyone. We've got a lot to cover. I'll spend the next 0.5 hour or so talking about where we want to take the business and share my vision as well as plans for the business. And we're in a really critical stage as we move from integration to transformation. This is a great time to pause and review where we are in the division, what the landscape is and what our future strategy is. I will lay out some of the strengths that we see in the business and also where we see the opportunities for further growth as we look to strengthen, as we look to innovate and as we look to scale our business. You'll also have the opportunity to listen to my team as they spend time with you during the breakout sessions. So let me start by setting the stage. David has already highlighted the progress that we made since 2021. So let me reflect on what makes our D&A business unique. As you can see, there are a number of strengths listed on the slide. I'm just going to pick one of them, and I'm going to focus on that. So our broadest and deepest data. So we connect to 550 real-time, multi-asset venues. Our market-leading Real-Time network carries a staggering 220 billion messages every day. And we've achieved all of this through our laser focus on our data quality. And the growth of AI makes us even more important as it opens up significant new opportunities. And at LSEG, we measure data quality in 3 dimensions: data accuracy, data coverage and the timeliness of the data. And delivering on all 3 requires a really careful balance, and we have a proven track record of getting this right. And as you can see on the right of the slide, we already work with 99 out of the top 100 banks. That in itself is a very impressive statistic. Clearly, we want to be 100 out of 100. And you know there's a salesperson waiting in the wings, eager to be the one that gets the 100th spot. Now let me spend a couple of minutes on the changes we've made to our reporting structure. So yesterday, Anna spent some time talking about which businesses will now be part of Workflows, Data & Feeds and Analytics. And going forward, D&A will report along these 3 business lines. And this new structure really allows us to be more focused, more aligned on our priorities. It also enables us to maintain synergies that we currently have with FTSE Russell, Risk Intelligence and, of course, the rest of LSEG. And this aligns really well with our partnership with Microsoft, which I will cover in a few minutes. So in essence, what are we trying to do here? We're creating a product-led structure that enables us to be a client-centric, world-class product organization. That's something I'm personally really excited about. And you'll hear this more from me throughout this presentation and any conversation you'll have with me later today. Now let's look at our market opportunity. You'll see on the left of the slide a number, I'm sure, most of you are familiar with, our current TAM, which is estimated at GBP 35 billion and it will grow at about 5% to 7%. And we'll deliver this growth by continuing to strengthen on our core and things we're doing with expanding our product functionality. What's interesting about this number is this only represents what customers spend on third-party providers. It's under half the spend of their total on Data & Analytics. There's an estimated GBP 50 billion of spend that customers currently take in-house to clean data and perform manual activities. This is, for us, the new playing field. That's really exciting. And it provides the clear growth opportunities that we see in the coming years. And we want to address this TAM with our offerings with Microsoft and beyond as well. On the right of the slide, you'll see structural trends that are facilitating these growth opportunities. So let's try to bring this to life. Today, some of our customers have up to a couple of thousand employees in their data operations team, carrying out technical validations, normalizing the data and storing it in their databases. It's a very time-consuming and costly exercise. And these are sort of challenges we want to help our customers address, breaking out of the historical view of the market and focusing more directly on our customers' needs. So I'm absolutely focused on this on thinking on how we can help our customers meet those changing needs to become more efficient and also to help create value for them. If we look at this another way and we slice the vendor TAM by customer segment, you'll see that we have a leading position across most of the customer segments in which we operate. That gives us a great foundation from where we can drive further growth in the business. This is a complex market. It's also very dynamic, and it has very dynamic customer needs. So we're going to focus on near-term investment in areas where we see breakthrough opportunities to strengthen our position. Our strategy for growth is working. You heard yesterday, both Enterprise Data and Trading & Banking have performed really well over the last few years. The question is, why is that the case? It's because of our concerted efforts on the priority areas you see on the right of the slide, which has ultimately led to better value for our customers and, as a result, improved performance. This is also evident through the record customer satisfaction scores, which resulted in improved customer retention and revenue. Again, you can see the investment we're making in the business is paying off. We've made good progress in ASV, product retention and customer satisfaction since we outlined them during our Capital Markets Day 2 years ago. For me, this is a great business to inherit and to build on. And you can see all the hard work of the integration is already paying off, and there's an exciting story of growth to tell both in the near term as well as in the longer term. What I want to show on this slide is that our transformation journey is end-to-end. It covers product, it covers sales, technology and operations. And you're going to hear Ron Lefferts, Triona O'Keeffe and David Shalders covering a lot more of the details in their presentations immediately after mine. And my objective here is very straightforward, it's to accelerate the end-to-end transformation journey. And I know the story is familiar to you, but it's worth stressing that these benefits of agility, efficiency and growth will continue to play out, and we will continue to invest here. This is a really important slide, something I'm really passionate about, so I'm going to spend a few minutes on it. So we've identified 3 steps: strengthening, innovating and scaling, which will incrementally move us from where we are today to where we want to be in the future. These 3 steps lay out our journey over the next few years and how it will help us prioritize, accelerate and grow at scale. So let me start with strengthening, right? We've talked about how we've improved our performance to date. For us to continue to grow, we need to strengthen the business. This is particularly important given that we're fundamentally a subscription business with 93% of recurring revenue. We'll continue to expand product functionality and improve the user experience with more customer-centric solutions. And we'll also complete the transformation of our technology estate, creating a more resilient and agile platform, which allows us to have innovation and growth at the same time. The next 2 steps, innovation and scaling, are where we'll continue to invest in our core and win market share. The innovating phase is where we'll capitalize on our existing data excellence to create products that no one else can create. And we'll concentrate our spend on fewer and more material opportunities, both organically and through our partnership; and again, Microsoft being a great example here. And then the last phase is where we can truly scale with an engineering mindset and an innovation culture and become, yet again, a customer-centric, world-class product organization. Naturally, there's been a lot of focus on Microsoft, and I'm going to cover that in a minute or 2. A few slides back, I showed you the impressive performance we're already seeing in the businesses today and how those metrics, including revenues, are trending in the right direction. If we focus on this slide for a moment, it shows some of the organic opportunities outside of the partnership that will continue to drive further growth in the business. Clearly, we have a track record of investment and delivery of results, which gives me every confidence in our ability to drive growth further. So let me give you a preview of some of these initiatives. So for Workflows, LSEG Workspace will continue to be a critical growth driver. We'll continue to provide customers with an enhanced experience as we upgrade them from Eikon, accelerating the deployment of LSEG Workspace using the OpenFin framework. And there's an added benefit of OpenFin in that it enables interoperability of LSEG Workspace components within our customers' desktops. That means we can truly meet our customers wherever they are. And for Data & Feeds, we'll help our customers reduce their physical data storage and management costs by offering cloud-enabled and managed data and feeds. We'll continue to deliver high-quality and unique content across all asset classes, offering unique data assets and content across the latency spectrum at lightning speed where they need it and how they want it. And for Analytics, building on our existing strengths in quantitative modeling and leveraging the breadth of our data assets, we can create new models in a more cost-effective way for our customers. And we'll also deliver API-centric analytic tools, enabling customers to easily integrate analytics across their organization. So as you can see, it's important to remember there's plenty of opportunity for growth even before the true impact of the partnership begins to kick in and scales. So in the breakout sessions, my team will spend time with you to go through these initiatives in more detail. Now let's focus on the partnership with Microsoft and one of the many reasons I'm excited about the future of D&A. It enables us to co-innovate solutions that will transform the experience for financial services professionals. We want to enable users like all of you in the audience to do more, faster and simpler. So let's picture what a financial analyst or a market data manager needs to do to get a comprehensive view of a company's performance. They have to sift and collate across potentially hundreds of sources, including performance metrics and analyses, to arrive at an informed decision. Our partnership will help that a lot of that pain, time spent and cost will be a thing of the past. And you'll see from the pyramid, we will integrate LSEG Workspace into Microsoft Office, which will simplify workflows and expand communities. We will change how our customers discover and experience data. And we will introduce AI-enabled apps and a modeling infrastructure that will improve productivity and enhance customers' own data excellence. Let's see what that really means in action. We have 2 demos that bring to life the innovation we're creating together with Microsoft. The first demo will show how we'll deliver enhanced data discoverability for financial services professionals using our Data & Analytics, all of which was powered by gen AI-native Microsoft Fabric and Purview. The second demo shows a use case of an equity analyst, which will resonate with many of you in the audience. It demonstrates how accessing LSEG Workspace and Microsoft Teams through simple language prompts will enable intuitive discovery, visualization and easier sharing of data and insights. So let's spend a couple of minutes watching both of those demo videos. [Presentation]

I've seen those at least a dozen times. And every time I see them, there's a bit of a wow that plays in. This is fairly amazing what we're trying to do together with all of you. So yes, both of these demos show how we'll deliver on our vision of co-innovation with our partnership with Microsoft. Now let me return to the base of the pyramid, which is what we describe as the foundation. This is the need for us to invest in our technology. We know that to successfully navigate through the other areas of the pyramid, we must continue to transform our estate. We've got a great story to tell here, so let me go into this in a little more detail. When you look at our data estate today, it isn't as efficient or as scalable as we would like it to be. This is something that needs to change, and we're addressing it. So transforming our technology estate is a critical element for the delivery of our commercial [ ambitions ] across the Microsoft partnership. And this is going to be powered with Microsoft Fabric. It's also expected to substantially reduce our database costs and materially improve the data accuracy and timeliness through modernized, more efficient tooling. And together, these improvements will help us accelerate our ambition of delivering a much more scalable platform for growth. It will also help us be more efficient, agile and resilient. So the Microsoft partnership initiatives I just mentioned will open up the opportunity for us to move further along the value chain, allowing us to knock on the door of the unvented GBP 50 billion TAM that I referenced earlier. The right of the slide shows where we can operate and open up the in-house spend through the partnership with Microsoft by addressing some of the pain points our customers are experiencing. In a minute, I'll share the time lines for the product delivery. But first, let me go through a couple of examples of what will enable us to win tomorrow. Data management as a service, it's a suite of AI-enabled applications that will help reduce customer costs on data storage, access and management. So while we're delivering true interoperability through LSEG, customer and other third-party data sets, it will allow our customers enhanced data insights. Modeling as a service, analytics as a service and LSEG Workspace will achieve interoperability across customer applications and facilitate custom models and analytics development. In turn, these will help us become the provider of solutions across the middle and the front office. And the opportunity to work with Microsoft and create value for our customers is what's really exciting to me. Key to all of this is putting the customer at the center of everything we do. It's incredibly important. It's the only way forward, and it's something I've personally prioritized throughout my career. Together with Microsoft, we are collaborating with our top customers through an iterative validation process. And I'm pleased to say we're receiving lots of positive and useful feedback on how we're thinking about the future of our product offerings. As you saw in the opening video yesterday, the excitement around the journey and where we're going is something that's coming through the senior-most customers that you saw yesterday. In a recent Design Partner Programme session, or DPP as we call it, one of our customers gave us some really pointed feedback and I quote, "We don't just want you to provide the data. We want you to partner with us to solve our data rights issues." And that's exactly what data management as a service will provide for our customers. We're at the beginning stages, and we're making good progress. There's a lot of interest from our customers, and we look forward to engaging with more customers in due course. Of course, alongside DPP, we have lots of people on product delivery working across the partnership, and we're making good progress. Product development will continue to be iterative as we move from pilots to full commercialization. So much has already changed since we announced the partnership. This slide is by no means the full story. We've evolved along with the environment around us, and what I'm showing here is how things stand today. So together, we're nimble enough to shift where it makes sense as things evolve. That said, you can see from the slide, there's plenty of work underway, and teams are progressing well across LSEG, Workspace, Data Intelligence and Analytics with product delivery through 2024. Let me zoom into LSEG Workspace for a moment as many of the features I'm going to refer to were in the demo videos you just saw. So let's start with meeting preparation, which is a great example of the work we're doing with Microsoft to create value from our data using large language models and generative AI. This solution will automatically generate meeting preparation summaries, combining insights using our financial data and all the relevant content in Microsoft 365, including documents, e-mails and chats. And pilots will start with the investment banking community, eventually moving to general availability for all LSEG Workspace users. Next, let's talk about open directory, which will enable fair and open access to chat and other collaboration experiences for financial services user communities through Microsoft Teams and other chat interfaces. And these are integrated within user workflows, underpinned by a compliance-first approach. Pilots will be targeted at internal and external users. Finally, the interoperability of LSEG Workspace and Microsoft products will enable users to seamlessly access, discover and share content. That's maximizing productivity through more integrated workflows. And again, for this one, internal and external pilots will focus on web users, and general release will start with wealth management users followed by Investment Solutions and Trading & Banking. There's also lots of focus and progress on data as a service and financial data engineering with phased product delivery planned, as you can see on the slide. Microsoft is just one of the ways we're building on our linkages across the group. What we show on this slide is that D&A already plays a huge collaboration role across LSEG. As we execute across our growth priorities, there will be further opportunities for D&A to become the connective tissue of data excellence and technology solutions across LSEG. As the divisions continue to work and collaborate, we will be well positioned to drive further customer value and retention. Our unique offerings make us a really important partner to our customers, which is incredibly exciting for our business. And as we enter the new phase of innovation, we're laying the groundwork to scale effectively in the future. We will become a customer-centric, world-class product organization with Microsoft as a partner. Our strategic direction includes transformational opportunities to drive growth, to strengthen our business and also strengthen our position in the market. And as you've heard, we have a clear path to this future growth. It's a really exciting time to be in D&A, and you can tell how positive I feel about this journey. I have full confidence in our teams to be able to execute on our plans and to help scale this business. On that note, thank you very much. And let me hand it over to Ron to talk about the sales organization.

Hi, everyone. Good morning. Good to see you again. And I represent the sales and account management team, which is focused everyday on making that 99 out of 100 banks to have a perfect 100 score. And so I'd like to talk to you about today about how we're doing that. So as you've been hearing from David, Anna and Satvinder, LSEG has been on a significant journey over the last 3 years. And we're investing to transform our offering and to continue to enhance our partnerships with our customers. And these partnerships are fundamental to the achievement of LSEG's long-term growth plans. And as a sales organization, we have a clear vision on how to build, grow and maximize those -- the value from those partnerships. And over the next 15 to 20 minutes, I'm going to unpack that vision for you in a bit more detail. Now our customer base is vast and it's highly diversified. Of course, a large portion of our customers are in the financial markets, but we also serve a wide range of other customer types, including corporates, central banks and regulators. And we have over 45,000 customers, including 99 out of the top 100 banks, 75 of the top 100 asset managers, and we deliver these services across the globe in over 190 countries. And we have incredibly strong relationships with our largest customers, but we are not singularly reliant on any one customer or any group of customers. In fact, of our top 250 accounts, they represent just around 55% of our overall revenue. And it's because of this diversity that we have to ensure that we serve our customers in a differentiated way that allow us to adequately prioritize resource, but that also delivers a highly effective outcome for them. And this is the heart of our strategic vision. Now of course, our customers contribute far more than just revenue. They also provide us with valuable and powerful insights that help us drive critical product development decisions. And I'll talk a little bit more about that in a moment. You heard David talked yesterday about the journey we've been on as a group since the acquisition of Refinitiv, and I'm going to zoom in on the customer-facing aspect of that journey. Early on in the integration process, we identified the challenges needed to overcome to build a scale organization to support our future needs. And for example, we were interacting with our customers in many different ways across many different markets, and we're way too siloing our approach. And we were selling focused and very discrete products rather than end-to-end solutions. And we absolutely were not disciplined in capturing our customer insights that -- through all those interactions, and we weren't closing the loop in our communications back to our product development life cycle. And we also didn't have the right incentive schemes to motivate our teams to partner more closely with our customers, which drove a focus solely on individual transactions. And we asked ourselves, how can we better transform the way we interact not only to benefit our customers, but also to inform and develop our products and services? Now as I mentioned, our customer base is highly diversified. And it's critical that we employ a differentiated approach with each customer dependent on the nature and scale of that relationship. And this is really important because some of our customers are highly complex global organizations that require a high-touch coverage model, deep understanding and to ensure that we have a unique perspective in order to solve their needs. Now at the other end of the spectrum, we have tens of thousands of customers who are also looking to grow with us, but they have a more targeted footprint and they require a less-focused interaction. And what we're building is a scaled service model that supports customer-focused interactions ranging from high touch to no touch through seamless integration of in-person and digital experiences. And we are already embedding smarter techniques. For example, we've already been using AI to help us better determine the next course of action in the sales process for our sales teams. And there's a big opportunity for us to effectively service our customers through our new e-commerce platform in an efficient digital manner. Not every customer needs a dedicated account team with frequent and high-touch interaction. And so we developed a platform that's smart, intuitive, easy-to-use, so that our customers connect with us and we connect with them with the right solutions quickly. This distinction in customer segmentation, while using disciplined best practices and next-generation technology like AI and digital capabilities, enables our organization to scale significantly more than our previous structure and to better focus on our customer needs and objectives by harnessing the power of one LSEG. One of our key areas of focus post the Refinitiv acquisition has been to foster a truly collaborative sales culture and sales organization, encouraging our colleagues to share insight, best practice and product expertise. This, in turn, is enabling us to go to market as one LSEG, supporting our customers unilaterally across our offering and throughout their workflows. For our strategic accounts, we now have full alignment and sponsorship from our Executive Committee, who share accountability for the success of those relationships. In Data & Analytics, we are now ensuring that we have true product specialists in place to support our frontline teams. And this is critical as it enables us to go right to the heart of our customers' requirements and determine the most appropriate solutions for them. And a great example of this is how we're helping banks navigate on new regulation like the fundamental review of the trade book. And to comply, banks must accurately understand their capital requirements. And we bring together our teams across Tradeweb, Yield Book, SwapClear to be able to aggregate and package proprietary data to ensure customers accurately understand their capital requirements. And to me, this example is how our teams can approach our customers in a joined-up way that delivers real value. And we have also built out dedicated solution sales teams to focus on our customers' most complex requirements like data managed services, which leverage a broad range of LSEG's strength across people, product, technology and operations. And finally, our interconnected approach is facilitating a more holistic set of conversations with our customers that touch upon a much greater portion of their workflows. And the broad nature of these conversations helped to inform our product developments and help us build highly relevant services that we bring to the marketplace. The feedback we receive from our customers is absolutely critical to the enhancement of our offering. And our sales teams play a key role in ensuring we collect this feedback through our interactions. We are in our customers' offices every single day, hearing their views directly, and this drives our product road map and help shape the way we go to market. And I truly believe we've taken this to the next level with the Design Partner Programme initiated via the LSEG Microsoft partnership. As Satvinder explained in his presentation, we're bringing together subject matter experts across business operations and technology to hear their pain points directly and establish their key workflows so that we can develop solutions that will be highly relevant to them. We then partner with engineers and product designers from both LSEG and Microsoft to share these ideas and to put them into practice. This process is well underway, and we had early meetings that have been really great. And I personally heard several aha moments, especially as Satvinder was describing our data management as a service or when you've seen the integrated banking workflows, we hear, I want that now, right? So very exciting. And that Design Partner Programme is really a critical part of the work we're doing with Microsoft, and it's made possible by the deep and highly strategic partnerships we've been building with some of our biggest customers. Now in our first half results earlier this year, David talked about our great partnership with HSBC. And the video you saw yesterday with John Hinshaw, HSBC's Chief Operating Officer, you heard him directly talk about real excitement in that partnership and how that has been driving value to their firm. And since that last update, we're pleased to say that the annual savings has grown to $43 million and continues to grow. We've also displaced in real time in their Global Markets division and had a major displacement in real time. We've also helped support their continued expansion of their wealth platform in Asia Pacific. And of course, they are active participants in the design program. And another great example is BlackRock and all the great work we do there. So being the largest asset manager in the world, they're naturally one of our largest FTSE Russell customers. And there are over $370 billion assets under management tied to 100 FTSE Russell indices that help power the iShares suite. And we're also a key provider of the data -- a key data provider in the Aladdin ecosystem, a platform that drives investment workflows for over 100,000 investment professionals around the world. And LSEG is the preferred data source for fixed income, equity and public reference data that helps drive the platform. In a couple of weeks ago, myself, David and Satvinder had our semiannual leadership review between our firms. And as always, we left with a clear understanding of their long-term strategy and game plan. And we also left with how LSEG is going to have a game -- has the game plan to critically partner with them going forward. And that's so essential in these type of interactions. And as you heard from Sudhir himself, Head of Aladdin, he said and I quote, "We are working together to create a shared road map of innovation and new product development for the benefit of our mutual clients." And that to me represents true partnership going to market together, driving value. And this is really all -- really embodies the one LSEG approach. It's all about understanding our customers' strategic objectives and aligning our solutions and our extensive ecosystem to partner with them to achieve those objectives. And when we do this, we see real benefit. And as we're aligning to our customers' needs and driving high-quality interactions, this is delivering significant results. In just the last 12 months, our customers tell us that they have a significantly better understanding of our products and services, and that is having an immense impact. And when we're engaging in that interaction with our customers as one LSEG, they are 6x more likely to recommend us with a 9 or a 10 out of 10 Net Promoter Score. And innovation for our customers is central to our strategy, and it's vital that we are actively engaging with our customers to highlight the benefits of new products and services like Workspace and the solutions we're developing with Microsoft as well as upgrades that we're frequently making to existing products. And when we have customers that tell us we're actively engaged, you can see that they are more likely to have a higher product satisfaction with workflows better supporting their business needs. So our focus is, of course, to improve upon that 76% active engagement, which will in turn continue to drive better product satisfaction and workflow integration scores. And so as I outlined earlier, this was a sales organization with great potential, but in serious need of realignment. And in the last 2 years, we've begun to execute on a clear plan to address each of the challenges I laid out. Instead of just trying to maximize sales volumes in isolated products, we're focused on selling solutions integrated into customer workflows. For example, instead of selling a point-in-time desktop and then a real-time feed and then analytics tools to a hedge fund, we're coming and approaching the customers as one LSEG, developing a nuanced understanding of their requirements and producing holistic end-to-end solutions to address their needs, often calling on many of our leading assets from across the group. And we're developing targeted, data-driven account plans for our largest customers with a view to maximizing value and efficiency for them and building steady and growing relationships. And we've evolved our understanding of how to interact with our customers, recognizing that some customers need high touch while others might prefer low touch, no touch or a digital experience. And we are now building out the capabilities to enable us to meet these preferences effectively and at scale. And we're driving collaboration across our sales teams and actively facilitating knowledge sharing and innovation hubs to spread and build upon our experience. And we're going to market as one LSEG, allowing us to develop deeper strategic partnerships with our customers. And we're making sure we've got the technical specialists in place to actively support our frontline teams. And finally, we've changed the incentive model for our sales colleagues to ensure we're acting in the best interest of the business and driving the highest quality and most professional standards at all times. And through all these principles, we have been able to create a truly transformational sales approach that we're implementing across LSEG. We made a lot of progress over the last 2 years, as you've seen in the results, but there is a lot more to do. And as LSEG continues to develop innovative and leading solutions across data analytics workflow and the financial services ecosystem globally, we have to make sure we are ready to partner with our customers effectively and powerfully demonstrate the impact our services can have on their businesses. So thank you so much for listening, and I really look forward to having you see all of the exciting work that we're doing in our breakouts. And with that, I'll turn it over to Peregrine.

Thanks a lot, Ron. So this is the key for the rest of the day to about 3:00. You'll have a personalized agenda on the reverse of your lanyard. We split you into 6 groups. So please follow your agenda. The map will show you kind of lines up with the letters of the breakouts. So if you stick to that, you can't go far wrong, and ask any one of the team or any other of the LSEG representatives who can help you. And then we'll be back in here shortly before 3:15 for the panel Q&A, which will be webcast. So we've got about 15, 20 minutes before you need to be at your first breakout. Thank you. [Break]

Okay. Welcome back, everyone. And I see you've all got a lot of notes. Welcome back to everyone on the webcast. We have now set aside now for Q&A with David, Anna, Satvinder and Ron. And let's kick off. So hands up for questions, please.

Yes. Thank you, Kyle. Sorry, you have microphones. If you wait for the microphone so the webcast can -- stick your hand up, Kyle.

Maybe just start with a question on EBITDA margins. Just the way that you laid out in the slide, the 3 segments, 52% for Capital Markets and Post Trade. And for Data & Analytics, specifically, 45%, and you showed that the peers are at 51%. So the question really is, given what we heard from Tradeweb with less expectation for margin expansion into the future, should we expect that really a majority of the margin expansion over the medium term should really come from that Data & Analytics segment? And is 51%, getting to a peer margin set, is that achievable in the medium term?

Thanks for the question. Anna, I'll turn that to you.

So yes, I mean the reason we showed that slide was because the majority of the margin opportunity is in Data & Analytics, and that's the piece we're working on. And I would say there's no structural difference in terms of our business versus our peers. That would mean that we shouldn't, whilst we've optimized ourselves, be at a similar level of margin. That said, it's going to take a number of years, which was the journey we've laid out.

Yes, Andy.

Thank you. It's Andrew Coombs from Citi. I'll ask 2 questions. And I apologize, one will be for Anna again. On the mid- to high-single-digit revenue growth, you talk about this accelerating after 2024 in part due to some of the Microsoft initiatives and other factors. When you specifically think about 2024, just so we can think about base, this year, you're talking about a higher -- upper end of 6% to 8%, but you've flagged that there's 1 percentage point from M&A in there. And then there's a couple of items in Post Trade. So what do you think we should be thinking about as the base from which to then accelerate from for the revenue growth? I can ask the second question now or is it better...

Well, why don't we take -- we'll take that one and then come back to you. Anna, you want to touch on it?

Yes. So I think your question is really, where are we for 2024? And the first thing I'd say -- I mean the first thing I'd say is all the momentum I talked to you about Q3, nothing has changed. So we're feeling good about the business as we enter 2024. Now I'll let you work out the exact numbers, but we've got good underlying organic momentum that you can work your way through. And there are a number of one-off items that will slightly slow our growth in 2024, which we've talked about and are fully reflected in your consensus or in analysts consensus, which looks to be sensible. And they are the reduction in cash collateral in Post Trade, Euronext, Credit Suisse, all the things that you know and we've spoken about. But as I say, where I sit today, we enter 2024 with good momentum and nothing has changed.

Thank you. Second question for the rest of the panel would be, when you think about some of the Data & Analytics businesses that you've outlined, you said #2 in workflows, #1 in real-time data and #3 in PRS. So when you think about the various different businesses, is it a case that, for example, in workflows, there definitely is a market share gain element whereas, for example, in real-time data, given that you're already the #1 player, you're more dependent upon the addressable market growth that David outlined yesterday evening? And within that, just to take a tangible example, you've given this figure for HSBC. Can you give us an idea of the breakdown of that between the Workflows business versus Data & Feeds?

Sorry, I missed the last part...

So you've given the number for HSBC and how much has been achieved of that from displacement. I'm interested to know what the breakdown of that is as a tangible example.

Yes. So we're not going to give more specific breakdown with respect to that example. I think -- and Satvinder, feel free to weigh in, in a moment here. I think we have, and hopefully you heard a bunch of this today, we have significant opportunity in each of those 3 areas using a number of different levers. So I wouldn't say we have this opportunity set in Workflows, whereas we only have this opportunity set in Data & Feeds. But Satvinder, why don't you weigh in on that?

So I think when you look at -- I think this question is a really good question. But if you look at the 3 businesses, they're actually really market-leading businesses today. And we're going to do a combination of 2 things: one, deepen our relationships and, therefore, grow market share; and number two is look at expanding the TAM that's available for these businesses. And how we deepen our market share, there was a slide I presented in terms of pre-Microsoft scaling. Here are the initiatives that we're looking at, right? We talked about the Eikon migration. We talked about PRS feeds. We looked up -- talked about migration to the cloud. We talked about modeling. So that gets us deeper. And if we spend a second on how we're going to expand the target market, let me just give you one example, right, Real-Time Optimized. So if you look at our Real-Time, we're #1. You think we're mature there, there isn't much opportunity to do anything else. So defend and keep growing slowly. We changed the game. So we developed Real-Time Optimized, which was it took the need of physical hardware, physical infrastructure, connecting to us completely away. We put it in the cloud. It was almost real time. Not everybody needs real time. So the corporate community then opens up. So we have a European corporate that's using our Real-Time Optimized data and actually using it to manage their supply chain. It's a completely different TAM. So a combination of going deeper into our existing customers and opening up new TAMs by ourselves and, obviously, with Microsoft is going to be what -- how we think the growth is going to happen.

And if I can just touch on HSBC, as David indicated, we wouldn't give specifics around where their cost savings are, but I can give you anecdotally that it is across all of our offerings. So for example, I mentioned already the real-time displacement. We've had hundreds and hundreds of desktop displacements across different divisions. And then in support of our open philosophy, for example, they wanted to build a portal themselves, and it required some fixed income analytics. So we exposed our [ AdFin ] fixed income library so they could build their own and displace some other competitors. So it's examples across the board.

Yes, Hubert.

Hi. Hubert Lam from Bank of America. I've got 3 questions. Firstly, on the -- going back to the mid-single digit, high single-digit guidance, how much of that is driven by market share gains and pricing? That's the first question. Second question is, again, for Anna. Yesterday, you talked about cumulative free cash flow exceeding underlying profit after tax to equity holders. So it's obviously a very cash-generative business. How should we think about what are you going to use with data cash? I know you're doing a buyback for next year, but should we expect a recurring buyback every year going forward just because of the strong cash generation? And lastly, a question on Microsoft. So your relationship with Microsoft is very entrenched now across Data & Analytics and Enterprise Data, banking -- Trading & Banking and also Capital Markets now. How should we think about the economics split in terms of revenues between Microsoft and LSEG, just given how you guys are [ a team ] now?

Great. So actually, why don't we mix things up a little bit here? So Satvinder, you can touch on the third question. Anna, if you want to answer the first question, and I'll actually answer the second question in terms of the buyback question. So yes, Satvinder, why don't you go ahead?

Okay. So very simple, we have guardrails. And the guardrails are based on a very principled approach to how the commercials across both sides are going to work. We will make money whenever a customer has a need for Data & Analytics services that we provide. We will obviously make money on any Workspace licenses. Microsoft will make money whenever their product licenses are invoked and used, and they will obviously make money on cloud consumption. Those are the broad parameters and the principles in which we will price products. Obviously, as we get more mature, as we do pilots, as we do MVPs, we will figure that out and get to the right combination. There will be different combinations depending on the product, but the guiding principles are the ones I just stated.

So can you take the first question in terms of the mid- to high single-digit question?

Yes, sure. So the mid- to high-single-digit growth is an organic guidance. And I called that out because we see this as a real step-up. Your question was, how do we think about share and price within that? I think we start from the customer and products that meet our customers' needs and we then charge appropriately for them. And so that will sometimes be through pricing, and sometimes the pricing may be lower and we may see larger share gain. So in the way we give our guidance, it is in aggregate because we make our choices solution by solution through the lens of what the right balance for the customer is.

And then on your second question, which was really, are we going to have recurring buybacks, if I phrased it correctly. So we have done GBP 1.5 billion in buybacks over the last 15 months. We've just announced yesterday, we're going to do another GBP 1 billion over the course of this next year. Nothing is changing in terms of our capital allocation approach. So this is a business that is enormously cash generative. And you have seen us have the cash generation to do the GBP 1.5 billion of buybacks, to do the M&A, to do the organic investment internally, our dividends as well. That will continue in terms of just from a policy perspective, from a capital allocation policy perspective. We -- I think I've been very careful not to commit to doing regular buybacks. But we are very committed to actively managing our capital. We have -- because of the nature of our business, highly regulated, we have a good line of sight both to when we might do M&A. And if we do, do any M&A, it typically has a pretty long regulatory approval period. So that gives us a very good handle on our cash generation when we are going to have cash that's available to use for buybacks. But as I said, we're not going to put ourselves in a position of committing to regular buybacks. But by the same token, as you can see, we are developing a very strong track record of actively managing our capital.

Bruce?

Thanks. Yes, it's Bruce Hamilton, Morgan Stanley. A couple of questions. Firstly, on the foundation piece, so the migration of the 50 data sets to the cloud, it feels, based on my sort of conversation in the term, it feels like that's quite important in that the sort of friction in accessing data and looking at data is still problematic. So what's the sort of time line for when that's no longer an issue, which could release more data usage? And how important is that to the process of charging more on it on a usage basis? That's the first question. The next one is quite a short one. I think, Anna, you said that EBITDA margin improvement will be nonlinear. I'm assuming that's simply that it picks up when revenues pick up towards the end rather than signaling anything else in terms of, they shouldn't be going down, it's just the pace of growth will be linked to revenues, just to make sure that's true. And then final one on Post Trade, the segment growth. I assume that embeds Euronext moving out to that 4% to 6% in your slide, just to double check. Thank you.

Thank you, Bruce. Satvinder, do you want to take the first one? And then, Anna, you can...

There's a reason we call the base of the pyramid foundation, right? It's the right word. It is very important to what we're doing. You saw the -- what we're trying to do. We're trying to move key data sets onto the platform. I think most of the key ones will move by the end of next year. That gives us the benefits accruing over time as we continue to move more. I think the more important part also is we're looking at a full reference catalog being available by then as well. So it gives us the ability -- so if you look at the slide I presented with all the Microsoft initiatives, they're not sequential; they're in parallel. And so we've got stuff going on with Workspace, with data and intelligence and analytics in parallel with what we're doing on the foundation side. So it gives us the ability to create value as we move across our data sets, but also our ability to monetize some of the capabilities that are really important to us like data management as a service in parallel as we do this. And one of the things we're also going to do is we're going to have a copilot in place that allows data platforms to add more discovery and data analysis. So all of this will happen in parallel. The time line is majority of that by the end of next year, but will continue in subsequent years as well.

So if I just do the EBITDA and margin growth. So by nonlinear, I'm not flagging that it's going down. I'm just saying that we shouldn't draw a straight line up. And just to clarify one thing you said, the reason we see EBITDA margin growth is as much about efficiency in our cost base as it is about revenue growth. And that's why we should be consistently driving it. And the reason that we are flagging that it will not be linear is because we want the freedom to invest when we see the opportunities with customers along the way. And Bruce, can I just clarify your last question?

Sorry, yes, just on the Slide 21, the Post Trade segment growth, 4% to 6%, just I assume that embeds the Euronext departure?

Yes.

Sorry, can I just clarify one thing on that? So that slide is about our market -- the market growth, not our growth in each segment. So where Euronext sits is neither here nor there. So that is a market growth slide. Yes?

Hi. Oliver Bazin from GVQ. You spoke yesterday about how people had doubts about your growth previously, and you've obviously beaten those and congratulations for doing so. And you spoke a lot in the presentation we've seen today about the structural growth the business is facing. I guess my question, looking at the slide, you also presented yesterday of how uncorrelated you are with typical things you might expect your business to be correlated to. Is what -- what are the biggest things that could cause you, which hopefully won't, but to miss those guidance? What's the downside that we should be aware of?

So I think the point of that part of the discussion yesterday was what a robust model this is, very diversified. We went through it yesterday by product, by region, by customer. I think this is -- it's a subscription business. 70% of -- 70-plus percent of our revenues are recurring. And again, you heard yesterday, in terms of the transactional revenues, how consistently growing those have been as well. And we've looked at this -- as part of our due diligence on the Refinitiv transaction, we looked back at how the business performed going back many years, including looking at what the performance was in these kinds of businesses in 2008. So it's hard for me to speculate on what could really drive a dramatic shift in the performance. When a number of customers go out of business, that wouldn't be a good thing. Anna has touched on the Credit Suisse very modest impact, but impact that we'll see over the course of the next few quarters. So I think if there's some kind of major financial crisis that wipes out a number of our customers, at the same time, I think you all know that when there's volatility, that tends to actually be a good thing for our business. But if there is so much volatility that everyone just puts pens down, and again, you could see that in some kind of major crisis scenario, that would not be a good thing. So I think that gives you a little bit of a sense of the robustness of the business, the real strength of the business, and it would have to be such a widespread crisis that it would take out a significant number of our customers and really shut down a lot of market activity. So...

Can I make a little build? Because I've had this question in many different ways over the last few days asked differently, which is why is it mid to high, which is where does that range come from? And what I've said to many of you is when we set guidance back in 2019, we didn't foresee a pandemic, a couple of wars, huge inflation, supply chain disruption. And as we set guidance going forward, we've given a range that foresees all of those things. So I think that's how we thought about it actually when we set the range in the first place.

And if I could build, one of the things that we're doing is where we can, we're really focused on execution, and we're focused on how we really have built our organization to try and be as proactive as possible. So especially in the 73% subscription side, 1/3 of my sales teams is focused on as a group called customer success, and we've developed a methodology called the customer life cycle framework. So we proactively monitor all of those subscriptions and understand where our markers are in terms of key renewals. And we deploy resources specifically focused on ensuring that they've got the right kind of utilization, the right kind of usage patterns and are really proactive. So we've taken a strong proactive stance towards managing our existing book, which is why you've seen a 300 basis point improvement in our retention rate. And so we view that as another way to help mitigate some of these other external events that could really impact us.

Thank you. That was very, very [ assuring ].

Yes. And Russell?

Yes, thank you. Russell Quelch from Redburn Atlantic. Given we're now, I think, at the point where sales has to take over some of the growth in place of retention, which has obviously been a big part of the growth this year, wanted to maybe ask a couple of questions around sales maybe for you, Ron. Firstly, in terms of the HSBC example that was given, you talked about that account being one that was a drag on growth. You've turned it into a growth account, yes? How -- within your top 20, maybe 50, if you want to go there, customers, how many more of those customers are left where you've got the same opportunity that you had with HSBC? That's question number one. In terms of question number two, when you think about -- you had a slide up there where you had all the sales initiatives and then you had pie charts down the side where how far you are through those various initiatives. And clearly, you're not there yet in terms of your sales or go-to-market strategy. I just maybe wondered if you could put some time frame around when we might expect you to be where you want to be in terms of your go-to-market strategy such that we can expect those new sales part of the growth to start accelerating.

Great questions. So I'll take the first one. And HSBC is an example of one of our strategic accounts, and you were asking around our strategic account program. That was an underserved customer segment for a long period of time under Refinitiv. When I first came in, I looked at the growth trajectory of those strategic accounts, and the growth rate between 2018 and 2020 was 0%. And so that includes price increase as well as market increase, so really not the right place you want to be with your top accounts. So they were, generally speaking, declining, it was a declining group. And so we -- as part of the sales transformation strategy, we changed how we approached those accounts. We changed how we engaged with them. And we also evolved some of our commercial models. So for example, HSBC is one of the accounts that's under something as akin to an enterprise type of agreement. And so that provides us with -- that provides the customers like HSBC with a certain level of cost certainty and a true partnership. And for LSEG, that provides us with certainty of revenue and as well as an incentive for us to partner together to find new revenue opportunities even outside of those enterprise agreements. And we found HSBC, for example, to be our fastest-growing gross sales, new sale account, even though it was under an enterprise agreement, for example. And now that collection of accounts that was growing at 0.0% for 2018 to 2020 is now projected to be growing more towards where our target rate is.

You want to just touch on the second question on the time frame on -- your continued progress on go-to-market?

Sure. So we have done a lot of great things, but there's obviously a lot more to go. Without getting into the entire strategy, I'll just pick out 1 or 2 examples. So one thing we wanted to do is to ensure that we trained all of our team on selling the LSEG way and one LSEG. So we made the largest investment in over a decade in our people to train them on a common methodology. So one of our sellers who sits in Seoul is speaking the same exact language and has the same approach as someone who's sitting in São Paulo. And so we are 100% complete with that rollout in APAC and in the first quarter will be complete. And so all -- every single salesperson will have gone through that methodology and training, which is a big milestone for us. But there are some others that are going to continue to take some time, but we've had some great progress. So we talked about building out digital capabilities and call center capabilities and more of like a global demand center type of model. So we made some incredible progress this year, partnering very closely with what you heard in some of the operations breakout with the operations team. So we have soft-launched our e-commerce capability. And in first quarter of this year -- next year, we'll be launching that more broadly. So we'll be putting World-Check online to be sold through our e-commerce channel front to back. And so we view that as something that could give us great access to a very large customer set without requiring humans. And in parallel, we built out call centers co-located with our operations center. So we had sort of a call center in supporting North America. We now build out call centers in Gdynia and Manila co-located with our operations team. We started -- we're able to staff those teams about 60% with resources we already had trained who were part of the team. We've moved thousands of accounts to be managed out of those, and we're just starting that. So we're going to start seeing some scale happen going forward over the next couple of years.

Yes, Arnaud.

Hi. It's Arnaud Giblat from BNP Paribas Exane. A quick question on what you mentioned during your presentation about the ability to price for usage as a vector for growth. I'm wondering, does this re-kick in with the full rollout of Workspace and Microsoft product? Or can that happen sooner? And with a lot of your key clients now on enterprise pricing, what's sort of the lag of the ability to change pricing? I suppose the contracts are set for maybe a year or 2?

So Ron, if you want to touch on the second question, then we'll come back to your first one?

Sure. So we are cautious where we apply the enterprise commercial model. And we have several commercial models available to us. Everything from this enterprise agreement, which falls into a certain pattern and where it makes sense for us, we engage in those. And we have some very large customers on them, like the few that I mentioned, and we have some smaller customers on them. So -- but that's a very specific pattern. And it's, I would say, a relatively modest percentage of our book. But where we've applied it, it has had the right kind of result that we've been looking for. We also have different types of models where many of our contracts are less than 12 -- or 12 months in duration. And that's an area of improvement that we're looking to get -- to move more to a longer term, more in the 24-month type of model to get some more consistency, especially if we're selling more smaller accounts where we have a lot more churn in our book, and so a lower target retention rate. So we look for some improvement there. And then as the technology becomes more available where we can do usage, we'll be looking forward to that because we approximate usage now. We sell often, for example, in our data subscriptions within bands in certain ranges, and then we monitor that in kind of a retroactive way. So we still look at usage, but it's more in the rearview mirror as opposed to a proactive way. So that's something that we're looking to improve upon.

Sorry, yes, we can go all the way back over there.

Hi. This is [ Harun ]. Just it seems like a lot of the opportunities you mentioned over the last couple of days are really opportunities that no one else is going after, either because they don't have the capabilities or history that you have or because the incumbents or the other players in the market don't want to disrupt themselves. So it really comes down to pace of product development, quality of product development and pace of execution. Have you maybe worked on the culture incentives and product development capabilities to deliver up against that? And have you learned anything from Microsoft on the product development side that's been helpful?

So Satvinder, I'll turn that one over to you in a second. Just to pick up, [ Harun ], on your comment in terms of the fact that we're going after some spaces that seems like no one else is going after. I think that's a function of the uniqueness of what we bring to the table strategically. And the fact that we can have such a broad-ranging strategic conversation as a partner with these huge global institutions, no one else can really have those kinds of conversations. I think you're right in terms of the fact that we have a very different approach. We're -- just to be blunt about it, we're willing to disrupt ourselves, and our open model really facilitates that. It facilitates the kind of partnership with our customers. And the number of our competitors have a very different approach, whether it's the closed silo model, whether it's the closed box model. And so I think because we have such a different attitude towards that, I agree with you. I think that a number of our competitors are in a very different position in terms of that kind of attitude towards self-disruption. But Satvinder, you want to jump in there?

Look, one of the things I will say is, look, the opportunity is in front of us. And as David said, we have a very different mindset to some of our competitors. And we're very proud of that because that's based not on our thinking that it is better, it's based on what we've heard from our customers. So our customers want us to be open, so we want to be open. Number one. Number two, while the opportunity is there, it will not last forever. It's not static, so we have to grab it. And we have to work at pace with it. So if you look at just the partnership and using that as a great example, we've got hundreds of people working on it. Microsoft has hundreds of people working on it. We have access to the best engineers, best product people, best client people at Microsoft. That's a great benefit. We're learning a lot from them as well. So there's parts of my organization that's benefiting tremendously by having that sort of exposure, not only to their minds, but also to their ways of working. So when we say we're on a journey to be a customer-centric, world-class product organization, yes, there are things we're doing organically ourselves. We're bringing in some of the best talent in the industry to help us in that process. But there are quite a few things we're learning through osmosis by watching how the Microsoft teams operate because we work with them day in and day out. So if you want to learn how to work in an agile way, there's no better example than actually working with teams that have grown up that way. So it's a combination of lots of things, but I think the bottom line for us is we've got to grab the opportunity, and speed is really important for us.

Yes, Mike?

Thank you. Mike Werner from UBS. Two questions, please. First, with regards to the acceleration of revenues after 2024, I was just wondering if you could help us better understand what's driving that. Is that revenue synergies that you think are coming through? Is that new products in terms of -- new products that you're developing with Microsoft? Or is this one where particularly with the Workspace with the Microsoft enhancements, as that gets rolled out, do you expect a little bit of a faster jump in terms of the price point of that product? And then second question, we sat and listened to the transformation team. And they talked about how the depth of the software development and engineer teams has improved substantially. Just going forward, thinking about some of the M&A that you have done over, say, the past 2 and 3 years to add capabilities, is that something that going forward we should expect LSE -- or LSEG, excuse me, to do internally as that software development team improves? And ultimately, as you get a lot of these projects rolling out, it potentially frees them up from a capacity perspective.

Thanks. You want to touch on the first one, I'll take the second?

Sure. You've heard a lot of the drivers of growth over the last couple of days, so I'll call out some of them, but actually many are relevant to 2025. So yes, we'll be seeing the revenue synergies flowing through. We already are, but they will continue to benefit us. Absolutely, we'll see the Microsoft partnership revenues start to come through in 2025. And you've also seen the pipeline across a number of other areas broader than Microsoft that will benefit us as well. And we continue to drive sales force effectiveness and pricing yield efficiency. So all of those things should flow through.

And on your second question, and I'll interpret it -- tell me if I'm interpreting this wrong, but I'll interpret it as we get better at building internally, will we have to buy less? Yes. Probably the best way to think about that is that we think about build versus buy analysis all the time. And there are a number of things that we are building right now that we had evaluated buying. And a number of the things that we have bought, we evaluated building. I think if you take a step back, you pick up on the comments that Satvinder was making in terms of changing how we build product, if you -- I'm not sure if, in our breakout sessions, if anyone touched on what we refer to as Project Gemini, which is in-sourcing a lot more of our engineering talent that had historically been outsourced. We are building a lot more, as we've talked about, engineering muscle within the organization. So I think that is a cultural change and that does improve our capability set, and we are getting stronger and stronger at the product build. But I think you will continue to see us evaluate build versus buy in a number of different situations. And there may be -- we'll see. There may be times when we might be building more going forward because we have incremental capability in-house. But there are also maybe circumstances where it makes more sense to buy. But I think -- I mean, it's an interesting question, but there's no definitive sort of we're shifting much more towards building and less towards buying.

Thank you.

Yes. Great. Enrico?

Thank you. It's Enrico Bolzoni, JPMorgan. A couple of questions from me. One on CapEx, you're guiding now for this decline. But within that, it seems that clearly, it's going to be less directed towards what has been underinvestment in the past and more towards other initiatives. Can you just give us some color in terms of understanding whether the CapEx that's going to come in the future will actually contribute just to increase the top line or actually there's more that can be done to improve the cost base and make it even more scalable? And then my second question, as a result of the partnership with Microsoft, the migration to the cloud and the other initiatives, would you say that actually it's potentially easier to do inorganic acquisitions, so small acquisition simply because the business, just for the way it's positioned, is more scalable so it's actually easier to plug in other realities to the existing one? Thanks.

Thanks. Why don't you take the first one? I'll take the second one.

Sure. So you will see declining CapEx as we move through maybe the rump of the integration of the Refinitiv business. And as we sort of move through that, we'll see more and more of our CapEx focused on 2 things: growth and continuing to drive efficiency because there are some areas where we can still do that. And that growth chunk will continue to be a significant number as it is today. But today, you also have some of the kind of core infrastructure stuff as well, which will fall away. So lots of investment in growth as we go forward.

Then on your second question, whether it will be easier to make acquisitions or maybe easier to integrate, I think a couple of ways to think about that. So first of all, I talked yesterday about the fact that we are really integrating this business. And significant investment going into that in terms of integrating our network infrastructure, consolidating data centers, et cetera. And so you will see us, if we're doing M&A going forward and we're doing this with the more modest-sized acquisitions that we've done since Refinitiv, we're actually integrating. We're not just stapling things on and then carrying on. And I think that's important and that requires discipline, and it requires sort of ongoing focus on that. To the specific question of once you have that integrated architecture, is it then easier to acquire? In some cases, yes, but it will depend. And so for example, if you think about what we're building, and I was talking with some of you about this earlier in the day, we're basically creating a very efficient and scalable machine where you can input new content here and then have a very efficient global distribution mechanism. So under that construct, it should be relatively straightforward to add incremental content into that machine. Now it will depend on what that content looks like and how we can ingest it. But then there are other potential capabilities or potential M&A that might not fit so easily into that machine, and they might relate to other parts of the business as well. So I think the long and short of it is we will have a more integrated business across the whole estate, which will make us more efficient and will make our business more scalable. And we will continue to maintain that discipline going forward. And in some cases, depending on the particular asset, that will make it easier to acquire and integrate. None of that will change the discipline with which we approach any M&A, and it has to make strategic and financial sense. And we've been very, very careful about that.

Ian?

Thanks very much. Ian White, Autonomous. Just a couple of follow-ups from my side, please. First up, on pricing, I'm just wondering if you might be prepared to share a bit more color around what you're assuming on pricing as a lever, particularly by the end of the forecast period. Does it become a bigger driver? Are you assuming that Workspace remains at a significant discount to the major competitor in the desktop space, for example? And that's question one. Question two. I'm just interested in thoughts around how you think some of the advancements in technology, cloud-based distribution, for example, might impact the broader competitive dynamic between vendors. So if it becomes cheaper and easier for customers to receive product or ingest data, does that also mean it's cheaper for them to switch between vendors? And should we expect to see more displacements and threats and opportunities that you see around that, please? Thanks.

Got it. So my typical approach on your first question would be, I would ask Anna if she wants to not answer that question. So we're not going to get into the specifics of multiyear views on pricing. I think what you've heard from Anna yesterday is that we have increasing capability to use pricing as a lever. We're going to continue to be thoughtful about it in the context of our long-term, very strong kind of trusted relationships with our customers. I think we're all aware of certain products where we have a significant discount to the competition. I've said in the past that we're not going to -- so for a 25% to 30% discount to a competitor, we're not going to move that up 24.9%. We will do it in an appropriate way, a phased way that makes sense for our customers and for our customer relationships, but not in a position to get into sort of a multiyear pricing discussion at this point other than just recognizing the continued improvement in our product, the continued investment in our product is improving our pricing power. On your second question on whether that makes it easier to switch, I don't think so. And yes, I'll turn it over to -- it sounds like you guys are both chomping at the bit to answer that one. Just I mean one quick point I'll make and then you guys can both touch on it. So we've gotten this question about cloud. And if you think about when we have our hardware in your trading floor, that that's really hard to switch out of. But when it's cloud distribution, that must be a lot easier. But what that doesn't include is the fact that you're using our taxonomy, our classification system and the consumption of all that data. And so we estimate that a big bank customer has our taxonomy, our classification system coded into 300 to 500 applications across the estate. So what you have is a situation where it's much easier to access our data, but it's still deeply embedded and deeply sort of coded into all of your systems. I don't know if you want to -- I don't want to give...

You took my answer.

Oh, okay. Satvinder, do you want to touch on it?

Look, I'm 4 months into this organization, but one of the taglines I love is we do a lot of things across the trade life cycle. Nobody does everything we do. And I think customers use us not for individual products or services. They use us for the solutions we provide. They use us for the investments we're making in the future, and they know we're going to create more value for them as they relationship with us and as they stay with us. And I think that is a very sticky point in addition to everything that David said, which is absolutely true. Just going to the cloud doesn't make it less easier for them to move. But I think there's a stronger emotional bond that we have with our customers, which is based on what we do, how we do it and our commitment to the future and our investment into the future.

Ben?

Thanks. Ben Bathurst from RBC. Looking out over the medium term, which regions do you expect to be the biggest contributors to the growth that you've outlined? And is there any change in the regional mix or contribution to growth relative to sort of the previous 3 years, given the fact that the world is arguably a slightly different place now?

So sort of starting point, Americas, the largest capital market in the world and is our largest market. We're seeing significant growth in Asia in a number of different product areas. Ron, do you want to touch on sort of the perspective on a global basis?

Yes, no, I'd love to. So we have seen surprising resilience and strong performance from EMEA. I'll state that first, extremely strong and across our product set and, in particular, with our core offerings around Enterprise Data, so in both real-time and in our reference data businesses. So very strong retention, very strong net new gross sales, high single-digit to low double-digit. So very, very strong. And EMEA has been incredibly resilient given all of the geopolitical things going on in that market. And then APAC, as David had mentioned, continues to have pockets of strength for us as well. There has been some exposure on some of our transaction revenue relative to some of our offerings that support investment banking, for example, our due diligence products, which have -- as that activity has slowed down, we've seen some slowness there. We've also seen in some of our emerging markets where there has been some more volatility like in China, for example, with a small and medium business, more churn, especially in recent quarters. But as we talked about overall and the strength of the business, the strength of our pipeline, still very in line and consistent with what we've seen in the past.

And just one last item on that. In Post Trade, we -- and this is more of a longer-term opportunity set, but really interesting what we're seeing in Asia. And that can be in a couple of different areas, whether it's in India, whether it's in China, where there's been a change in the futures and derivatives law over the last 1.5 years, that makes it more acceptable from a risk management perspective to engage in clearing in China, for example, both international banks going into China, but also potentially Chinese entities clearing more internationally. So that's a little bit more of a longer-term view.

Yes, sorry, right at the back. I can't even see that far. Oh, it's Kyle, I think, again. Different Kyle.

Thanks, Peregrine. Hi. Yes, it's Kyle O'Donovan with Alua Capital. Thanks for taking the question. One of the more exciting messages, I think, from yesterday and today for me at least was the acceleration of the product launch with Microsoft to the first half of next year previously versus the second half of next year. So you still, though, kept the revenue contribution to starting in 2025. I'm just curious if you could expand a little bit more on that. And is there an opportunity where because of the acceleration of the launch, potentially start to monetize the products in 2024? Or if not, what is different, I guess? What changes by 2025 that you start to activate that revenue?

So what we've said in the past, and there's no change in this, is that you'll see material revenue in '25. And so there may be an immaterial shift in terms of what we see in '24 based on the earlier launch. But in terms of that kind of materiality threshold, we're not expecting a meaningful shift. I don't know if you'd add anything to that.

No.

Sorry, yes, sir?

All we've heard is wonderful good news. So being an analyst, I have to think of the opposite. The financial sectors around the world are changing, many of them reducing the number of players, reducing pricing. What is the worst thing that you could imagine that could happen to you over the next couple of years?

Who wants to answer that?

Where do you want to start?

Can I actually -- yes, I think one of the things that we are super focused on, and we haven't -- we've talked a lot about resilience over the past 1.5 days, but one of the things that we're really focused on, and we haven't really talked about explicitly, is our risk management culture. And this is something that we take very seriously. A core part of how we operate is something that we -- when we acquired the Refinitiv business, one of the things that we had to implement, and again, we haven't really talked about this over the last 1.5 days, is a risk culture within that business. Thomson Reuters viewed itself largely as a media business. We view ourselves as systemic market infrastructure, and that's just a very different mindset. So I mean you asked a question like that, I could give you a million things that could go wrong. And we do lots of scenario planning so that we are prepared for whatever may come. We're very focused -- a big part -- we don't have meaningful -- like financial institutions, there's often a lot of concern about balance sheet risk. We have GBP 300 billion or so of collateral in LCH. But because of the way we manage that, you shouldn't think about that as traditional balance sheet risk in the way that you would think about it at a bank. And then we're very focused on operational risk, regulatory risk and various other things like that. So it's a core part of how we operate. We run all kinds of, as I said, scenario planning, test runs for various things, exercises. But -- and we think in terms of backup and resilience. And so I would like to say -- and we've got David Shalders, our COO, here who deals with a lot of this as well. Our Head of Risk is not here right now. But we build redundancy into the system. And so that if something goes wrong, we have the backup and we can recover very quickly. So that's probably the best way I would answer that at this point. I don't know if anyone has anything you'd want to add.

Well, I would add, because we're that critical infrastructure, we are very embedded in our customers' own plans on how they're managing their own risk. And so we partner very closely with them as well on their own plans. And so that -- so we inform each other in terms of how we're managing risk. So I think that's also a really critical part of what we do because we're such a critical part of their operations as well.

Any more questions? Oh, yes, at the back.

Thanks. [ Rahul ] from [ Lundin Capital ]. Thanks for taking the question. When you guys first did the Microsoft partnership, AI wasn't as big of a buzzword as it is today, obviously. But it must be influencing the technology road map on a go-forward basis. When I just think about an average user of your products, they are probably using less than 1% of the data that you actually have, right, on a given day or whatever it is. And so having an AI interface, right, where you could potentially natural language query, right, and just the consumption of the data that, that could bring about, how -- like how big of an opportunity is that? How big of a priority is that? And what are you doing to go after that opportunity?

So it's interesting that you link it to AI, and I understand why you've linked it to AI. I would not limit it just to AI. And the reason for that is that there's a lot that we are doing that makes it easier to access and utilize our data. And some of that is as simple as moving it to the cloud. So -- and we refer to this as liberating the data. And in many ways, that's what we're doing strategically with our data sets that Satvinder was talking about. And by making that available in a cloud environment, in an integrated architecture, we're liberating those 48 or 50 different data sets. And we've seen that when we do that in the past, that leads to a pretty dramatic pickup in usage and consumption. And World-Check is the best example of this where we used to distribute World-Check by file transfer. And I don't know what the time frame was. It was once a month and then it was once a week. And then now it's embedded in a lot of our customers' systems, either through feeds and it's also available through the cloud. What has that done? It's made a lot of our customers now use it real-time. Some payments firms check every transaction with our World-Check database. You can imagine what that has done to the usage of that data, the consumption of that data. And because of that facility, when Russia invaded Ukraine, we've talked about this in the past, the usage of World-Check went up 800%. So that is what we mean by the liberation of data. I think to your question on AI, it's going to do it. I think it will be yet another accelerant and hard to calculate what that will look like. But this notion of the liberation of the data, we think, is a very positive tailwind for our business modeling. So Satvinder, I don't know if there's anything you'd want to add to that?

Just a couple of things. One is internal use cases. You heard Ron today talk about how they're using AI in the sales organization. In the breakouts, you probably heard, in the transformation breakout, how we're using AI for our own internal efficiencies, how we interact with internal inquiries, customer inquiries. So that's just one part. Then you look at stuff we're doing right now, BAU activities, how we're embracing AI, advanced dealing, how we're using chat rooms to preorder, put orders in, and that's an amazing ability to take a couple of those workflows out, take the friction in the system out and create something that adds a lot of value. In my deck, you saw that one of the test cases we're putting out there with our partnership with Microsoft is the Lipper AI-assisted Q&A chatbot that we want to put out there. We've also talked about, as we do our data platform, how do we put a copilot in there that allows for data discovery and analysis. So there's a lot of things we can do with AI. To David's point, it liberates it, but it also creates significant efficiencies for us internally, but also creates significant efficiencies for our customers and allows them to be a lot more efficient and do a lot more of the value-add on top of that. So I think it's a real game changer, and we totally agree with that.

And I would add, our customers are really asking for us to accelerate that as part of our road map. And we think that that's key and really strategic that we're partnered up with Microsoft. And so as part of the outreach to our customers, as we're building our capabilities, just for example, earlier this week, we met with one of the large interdealer brokers, and we're talking with them about a large segment of their business. And I was there with Dean Berry's team, who you met Dean in terms of the Workflow breakouts. And their main use case was, hey, listen, what we want is chat. So we don't want any more screens, just include it so it's just easier and intuitive for us to get what we need because we just chat all day long. So if we have that capability embedded into the rest of our information, we're going to -- you deliver that, you're pushing an open door, okay? You're knocking on an open door in terms of the capabilities that we want to buy from you.

I think we have one more question. Johannes, just behind the pillar.

Thank you. Johannes Thormann, HSBC. Just one final follow-up question on the EBITDA margin. You don't want to give a precise guidance for the next years. But what could be the long-term ambition for the group? Is it that Data & Analytics gets to the same level of the other 2 units? Or does all units get even higher to 55% EBITDA margin? I don't want to focus on a year, but just as a long-term ambition, what is your thinking about this?

David handed me a question not to answer. So look, what we've laid out is the gap to our [ PSF ], and that will create considerable value for ourselves and investors as we close it. There's no shortage of ambition here. And as we continue to drive significant revenue growth, that allows us to go further. But where we sit today, we have a strong path to improve our margin.

So thank you, everyone. I'm going to hand over to David in a second. Just to say, we do have one of our long-standing issuers doing a market close, so I'm really very happy to stay and watch. But David, I don't know if you want to wrap up?

I would be delighted to. And Peregrine, thank you for your sharing of the events here. Thank you all for coming. Thank you for spending 1.5 days with us. I hope you have had an opportunity to see the array of opportunities and the strength of the strategic road map that we have laid out. Most importantly, I'm thrilled that you have had the opportunity to meet the broader team. I know Anna and I have spent a lot of time with you over the years. I'm sure you're tired of seeing us. And hopefully, it's been a great opportunity for you all to meet the team because we have a great team in its strength, in its expertise, in its vision, and you can see the direction that we are going in. So again, thank you for your support. Thank you for being here.