Nemetschek SE ($NEM)

Ladies and gentlemen, welcome to the Nemetschek Earnings Call for the Financial Year 2025. I'm Moritz, your Chorus Call operator. [Operator Instructions] The conference is being recorded. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Stefanie Zimmermann. Please go ahead.

Thank you, operator, and hello, everyone, and a warm welcome. Thanks for joining our earnings call today to discuss the results for the financial year 2025 and the outlook for 2026 with us. With me today are our CEO, Yves Padrines; and our CFO, Louise Ofverstrom. Today's conference call is being recorded. A replay of the call will be available at our website after the call. Additionally, you will find the annual report, the presentation and the press release on our Investor Relations website as well. But now let's get started. So I would like to turn over to our CEO, Yves Padrines.

Thank you, Stephanie. Good afternoon, everyone, and welcome to our financial year 2025 earnings call. As usual, I have prepared a short and informative presentation on the highlights of the financial year 2025 that our CFO, Louise Ofverstrom and I will briefly walk you through so that we have enough time to address any questions you may have during the Q&A session. Let me start with the key messages of the fourth quarter and the full year 2025 on Slide #3. We delivered a very strong finish to the year, driven by an excellent performance in our Build segment, which once again showed outstanding momentum, in particular at our brand Bluebeam. At the same time, the Design segment also continued to perform very well, supported by strong subscription dynamics, including continued demand for multiyear contracts despite an exceptionally high comparison base in the fourth quarter of 2024. Looking at the full year 2025, we continued our very strong growth path with a high double-digit growth while further improving our profitability. The main growth drivers are a significant increase in subscription and SaaS revenues, particularly in our Design and Build segments, reflecting the continued success of our transition to a subscription and SaaS-centric business model. Please keep in mind that while we achieved an attractive profitability in 2025, reported EBITDA was impacted, among other things, by extraordinary nonoperating effect in the low teens million euro range related to the unexpected insolvency of a service and payment provider. [indiscernible] innovation and in particular, artificial intelligence remain the key strategic focus for the Nemetschek Group. We are increasingly evolving a leading vertical software player into a vertical AI leader, leveraging our deep domain expertise, unique data intelligence as well as trusted customer relationships along with strong network effects. In this foundation, we see a tremendous opportunity to extend our TAM and address substantial workforce-related TAM across the industries that we address. Looking ahead, Nemetschek is very well positioned to further strong and profitable growth. Based on our strong market position, the continued momentum in subscription and SaaS and our accelerating AI innovation road map, we expect an above-market organic revenue growth of plus 14% to plus 15% at constant currencies for the financial year 2026, combined with a high EBITDA margin of 32% to 33%. On the next 2 slides, you will see how these key messages translate into the development of most important financial indicators in the fourth quarter as well for the full financial year 2025. Starting with an overview of our fourth quarter results. Overall, we delivered another strong quarter and a very good finish to the year. Starting with the ARR, or annual recurring revenue, in line with one of our key strategic priorities, transition to a subscription and SaaS-centric business model or annual recurring revenue recorded an increase of plus 17.6%. If we adjust for strong FX headwind we had in the fourth quarter, mainly stemmed from the weaker U.S. dollar, our ARR increased by 22.9%. It is substantial growth in our recurring revenue base, we were able to strongly increase our revenue despite the very high comparison base in Q4 by plus 18.8% on a reported basis and plus 16.7% on an FX-adjusted basis. The main growth driver was once again the exceptional performance of the Build segment, in particular, Bluebeam and the continued good growth in the Design segment. The EBITDA increased by 12.4% or plus 19.9% at constant currency, outpacing revenue growth and resulting in a very strong EBITDA margin of 32.9% despite the ongoing transition to subscription and SaaS in the Design segment. Finally, earnings per share increased by plus 25.2% to EUR 0.56, supported among other things by strongly reduced interest expenses year-over-year. We continue with an overview of our full year 2025 results on Slide #5. In a nutshell, 2025 was another very successful financial year and a strong confirmation the Nemetschek Group is on the right path, delivering very high and highly profitable growth while making consistent progress across all our strategic focus areas. Starting with the top line. Reported revenue grew by plus 19.7% to EUR 1.19 billion, making for the first time in the history of the group that we have exceeded EUR 1 billion revenue mark. Adjusted for FX headwinds, particularly the weaker U.S. dollar, revenue growth at plus 22.6%. Addition to the strong organic development, the growth also benefited from the inorganic contribution from GoCanvas during the first half of the year as well as temporary positive effects related to the successful completion of the subscription transition of Bluebeam. The recurring part of our business once again proved to be the main growth driver, particularly subscription and SaaS revenues. Consequently, revenue in this category increased by an impressive plus 51.2% to EUR 858.7 million or plus 55.6% at constant currency. Our EBITDA increased by plus 23.3% on a reported basis and by plus 28.9% at constant currency to EUR 371.1 million, corresponding to a reported EBITDA margin of 31.2%. Please also keep in mind that if we adjust for the extraordinary nonoperating effects related to the unexpected insolvency of a payment and service provider in the first half of the year, the underlying profitability would have been even higher. Looking at the bottom line, earnings per share increased by plus 23.9% to EUR 1.88. And on the right-hand side of the slide, you can also see our continued strong cash generation with a cash conversion of almost 109% as well as the very high quality of our balance sheet. This very solid financial position, combined with our strong earnings and cash flow development provides a high degree of resilience going forward and also enables us to act opportunistically and strategically should attractive M&A and venture investment opportunities emerge. Coming to Slide #6. Before I hand over to Louise, who will provide a deeper dive into our financial results, I would like to briefly address what is currently the most important topic for us. Our transformation from a leading vertical software player to a vertical AI leader and how we will achieve this. Let me state this very clearly upfront. At the Nemetschek Group, we are deeply convinced that AI represents a tremendous opportunity, and we are ideally positioned to capture it. For decades, we have built deep domain expertise and strong integration into our customers' workflow by serving the AEC/O and media industries, especially in construction, a deep understanding of workflows, building codes and regulations is absolutely critical. At the same time, this has enabled us to build long-standing trusted customer relationship and strong network effects. This trust often built over many years is what enables us to construct to start-ups or new market entrants to successfully introduce AI-driven solution in an industry that is inherently conservative given the highly regulated nature of the industry and the associated liability risks. And finally, we benefit from access to vast industry-specific data sets across the entire building life cycle, a key competitive advantage that is extremely difficult for new entrants to replicate. Building on this strong foundation, let me now briefly walk you through the three key levers we are using to develop an AI scale across Nemetschek Group. Starting with product development. AI is not new to us. We have been actively developing AI capabilities for several years. However, over the past 3 years, we have significantly increased our investment to further accelerate innovation. It enables us to continuously enhance our product portfolio with AI-driven solutions that deliver tangible value to our customers. A recent key example is Bluebeam Max, our new AI-enabled solution, which we successfully launched commercially as planned a few weeks ago. It combines Bluebeam's AI development with the technology of Firmus AI and integrates agent-based AI into Bluebeam's PDF workflows, enabling early risk detection in preconstruction design reviews and helping increase efficiency while reducing costly rework. As planned, solution is initially being rolled out to direct large customer first, a broader rollout across indirect channels and our web shop over the course of the year. In addition, we are accelerating our AI road map through targeted M&A, such as, for example, the acquisition of Firmus AI last October as well as venture investments in AI start-ups, complementing our internal capabilities with leading-edge technologies and further strengthening our position in AI-driven innovation. And finally, strategic partnership are another important lever. On the technology and commercial side, we collaborate with partners such as Google Cloud to scale our AI capabilities. At the same time, our academic partnerships with institutions such as Technical University of Munich, Stanford University, Nanyang Technological University Singapore support ongoing research, innovation and knowledge transfer in AI for the build environment. This ultimately enables us to expand our addressable market by unlocking the significant workforce-related TAM in our industries by strengthening our competitive moat and building a scalable data and intelligence flywheel across our platform. In addition, we are further enhancing our internal efficiency, driving tangible cost savings that enable additional investments in our long-term growth. With that, we now hand it over to Louise.

Many thanks, Yves, and a warm welcome to our earnings call for the financial year 2025 from my side as well. Yves has already briefly touched on some of our key financial figures for the past financial year. So I would therefore now like to take a closer look at the most important financial aspects of our 2025 results as well as our main underlying drivers. Starting on Slide 8, we have an overview of the development of our four segments in the financial year 2025. Let us start with our Design segment. In 2025, the segment continued its strong growth momentum and grew 10.4% 12.2% currency adjusted, and that's despite a high comparison base in the previous year, especially in the fourth quarter. Positive growth momentum in 2025 was driven by a strong increase in the segment subscription and SaaS revenues due to the continued successful ramp-up of the subscription transition. And in addition, growth was partly supported by 3-year contracts. These contracts are being used strategically only during the subscription transition in order to accelerate the migration of existing maintenance customers to a subscription-based model at our Graphisoft and Allplan brands. Reported EBITDA margin of 28.1% contracted slightly year-on-year due to the associated short-term accounting-related dampening effects of the subscription transition, and the extraordinary nonoperating effect from the insolvency of a service and payment provider in the first quarter of 2025. When adjusting for these extraordinary service and payment provider effect, the underlying EBITDA margin would have been at prior year level despite the ongoing very successful transition to subscription. Continuing with the development of our Build segment, which once again delivered a stellar performance during 2025, driven by sustained strong customer demand across the board, but particularly strong for Bluebeam. In addition, the segment benefited in the first half of the year from the inorganic contribution of GoCanvas, which we have acquired as of July 1 in 2024. and it was also impacted by temporary positive effects following the very successful completion of Bluebeam subscription transition. Consequently, and as expected, growth moderated somewhat yet at a continued high level in the second half of the year, reflecting the normalization of temporary effects following Bluebeam's successful subscription transition and the resulting higher comparison base thereof. The financial year 2025, reported growth of the segment reached 41.3%. Adjusting for the strong FX headwind, mainly stemming from the weaker U.S. dollar, growth reached an impressive 46.6%. Reported EBITDA margin reached a strong 35.8% growth, an increase of around 400 basis points year-on-year and despite the continued investment to support the future growth of this strong and highly dynamic segment. Let us move on to our Managed segment, which recorded modest growth, 4% for the full year 2025. In the fourth quarter, however, we saw a [ re-affiliation ] of growth momentum in line with our plans of reshaping of this segment, revenue increasing by 6.8%. This development was driven by a stronger momentum in new large customer orders and reflects all the measures we have taken to refed focus and strengthen the segment this comes with -- also in line with our strategic focus and despite our continued investments in the segment's product portfolio and future growth opportunities, and EBITDA margin that expanded to 12%, up from 10.2% in the prior year. Last but not least, let us have a look and come to our Media segment, which continued to be impacted by mixed market dynamics, including cautious customer spending, particularly in the important U.S. market. And in addition, the segment was also affected by the missing subscription sales in the first half of the year following the unexpected insolvency of the payment and service provider. And as a result of this, revenue in the Media segment increased only moderately 0.8% on a reported basis or 2.9% at constant currency to EUR 121 million. Adjusting for this one-off impact related to the service and payment provider, revenue growth for the full year 2025 would have been in the mid-single-digit percentage rate and therefore, well in line or slightly above market growth in this segment, as good and consistent cost control, the segment's EBITDA margin declined only slightly to 33.9% despite the extraordinary nonoperating effect in the first half. If I exclude this effect, the EBITDA margin would have remained at prior year level. As you know, the continued internationalization of our business remains a key strategic priority for us. On Slide 9, we can clearly see that we have successfully strengthened and expanded our international presence in 2025 as well. Looking at our regional revenue development, we have seen a strong growth across all our target regions over the last 12 months. In Europe, which still accounts for 48% of our group revenues, we continue to navigate partly more challenging market conditions in the DACH region, particularly in the Design segment. While we recorded an acceleration of growth year-on-year in our domestic market of Germany, growth outside Germany was again stronger and reaching around 20%. Growth in Europe was well supported by a strong performance in our Build segment, particularly benefiting from the continued regional expansion of Bluebeam. In addition, although still from a relatively small base, our expansion into the Middle East region is progressing very well and is already showing promising growth since the inauguration of our new presence in the region in 2025. In the Americas region, which once again recorded the highest growth among all regions at plus 24%, the important U.S. market continued to benefit from a continued strong demand environment, particularly for our Bluebeam and GoCanvas brands, which remain the main growth drivers in the region for us. In addition, growth in the first half of the year was further supported inorganically by the GoCanvas acquisition that we made in the second half of 2024. Currently, 10% of our group revenues, Asia Pacific remains a key focus region for future expansion. While the entire region grew by 60% year-on-year, the important Japanese market showed a negative growth in 2025 due to a short-term and accounting-related effects on the subscription move of our Design segment impacting the growth temporarily in that market in 2025. In contrast, the rest of the region, and in particular here, Australia and India, continue to enjoy both ongoing very good market conditions and recorded very high growth rates. So as you can see, our internationalization strategy and the continued diversification of our global footprint is really bearing fruit and leaving us confident for further continued strong growth and expansion going forward. And as we move forward, we remain focused on capturing new growth opportunities while, of course, simultaneously strengthening our leading positions in our existing key markets. We already alluded to the fact that recurring revenues were once again the main growth driver in 2025. That does not come as a surprise and is a strong and important testament to our successful business model transition. On Slide 10, we can see a comprehensive overview of the progress made over the past year and also over the longer term since the start of this key strategic priority, namely the transition to a subscription and SaaS-centric business model. Starting on the left-hand side of the slide, you can see that our [ BOSS ] business model is now almost fully recurring with a share of 92% at the end of 2025. And we are already well advanced in our transition to subscription and SaaS with the vast majority, 72% now coming from revenues in the segment of subscription and SaaS. Looking at the longer-term development, the chart clearly shows the speed and the scale of our progress in building up a fully recurring revenue base in our business model. Over the past 4 years, subscription and SaaS revenues have increased almost sevenfold, representing a CAGR of around 6%. And as you can see on the right-hand side, this strong development continued also in the fourth quarter in 2025 with a recurring revenue growth of 22.9% and an increase in subscription and SaaS revenues of even 37.2% on a constant currency basis. So as expected and in line with our strategic focus, the more volatile license revenues declined [ 3% ] year-on-year at constant currency and underlining our aspired continued shift from perpetual licenses to subscription models well. To conclude our review of the results of the financial year 2025, let us have a joint look at a more comprehensive overview of our key P&L and cash flow items on Page #11. We have already addressed our main KPIs such as revenue growth and EBITDA margin in detail. And while revenue growth in the first half year of the year benefited not only [indiscernible] but also from M&A contribution as well as temporary positive effects related to the successful completion of Bluebeam subscription transition, our OpEx development and profitability were also impacted by some special effects. These included, for example, the acquisition of GoCanvas as well as the insolvency of a service and payment provider, as already stated. As a result, the full year development of certain cost lines does not fully reflect the underlying run rate going forward. Let's take, for example, here, the largest component of our overall cost base, which is personnel cost. Here, we saw a reported growth of 14.6% year-on-year for the entire financial year 2025, and that might appear elevated at the first glance. However, this was mainly driven by a strong increase of around 24% in the first half of the year, driven by the addition of more than 300 GoCanvas employees who we were very happy to welcome to our group. In the second half of the year, personnel cost growth normalized to around 6% and reflecting further improvements in the underlying resource efficiency. A similar pattern can also be seen in other operating income and expenses, which increased by 24.9% for the full year. This was also primarily driven by a significantly higher increase in the first half of the year due to the impact of the unexpected insolvency of the service and payment provider leading to a one-off cost impact. Despite these effects, on a comparable basis, excluding amortization charges mainly related to the GoCanvas acquisitions, earnings per share before PPA increased by 23.5% to EUR 2.15, so very well in line with our EBITDA growth. Our underlying free cash flow generation in '25 was again very strong with a cash conversion of almost 109% and was additionally supported by a favorable tax cash flow impact following the changes in the U.S. tax regime. However, even when we exclude this positive effect in the U.S., cash conversion remains above 100%, and this is a strong level we also expect going forward. It is therefore fair to say, I believe, that the development of our free cash flow before M&A, which increased by 32.7% year-on-year, once again underlines the high quality of our earnings well. Finally, due to our strong operating performance, we again further improved the quality of our balance sheet with an equity ratio of 45.6% and a net debt-to-EBITDA ratio below 1x. So all in, Strong financials delivering a strong and successful record-breaking year. And with that, I'll hand it back to you, Yves.

Thank you. Louise has provided a very good overview of the underlying drivers that have enabled us to achieve or even exceed all of our targets for the financial year 2025. It's also clear that our targets for 2026 will be ambitious in light of our very strong performance last year and the resulting substantially higher comparison base. So before we come to the end of our presentation with our outlook for the financial year 2026, let me briefly highlight on the following slide why we remain very confident in our ability to reach our goals for 2026 and beyond. In short, is the strength of our underlying operational business combined with our clear strategic direction and strong innovation power, most importantly, our clear focus on artificial intelligence, which is embedded across all of our strategic priorities. Let me briefly walk you through our different key strategic priorities shown on Slide #13, which builds the foundation for our future growth, while at the same time, illustrating how we are becoming a vertical AI leader in ACO. Starting with innovation. Artificial intelligence is an important driver of innovation across the entire Nemetschek Group. As already mentioned earlier in the presentation, Nemetschek benefits from a unique combination of deep domain expertise, long-standing customer trusted relationships, strong network effect and access to large industry data sets. This unique position enables us to develop AI-driven solutions that deliver tangible value to our customers. At the same time, we have significantly increased our investment in AI over the past years to further accelerate innovation across our portfolio while ensuring that all developments remain grounded in trustworthy principles that place the human, our customers or fans at the center. Another important cornerstone of our strategy is to accelerate our AI road map by targeted M&A and venture investments. With acquisitions such as Famous AI, we further strengthened our technological capabilities and complement our innovation portfolio with leading AI expertise. Our next key priority remains continued transformation of our business model towards subscription and SaaS, further on as a vertical AI leader, which continue to be a major driver behind the strong growth in recurring revenues that we have seen across the group. We are further strengthening our go-to-market approach, particularly by expanding our international presence and unlocking additional growth opportunities in high potential region such as India in the Middle East. Another important pillar is our group-wide cloud platform and infrastructure. Here, we are building a comprehensive ecosystem by eliminating information silos and enabling connected end-to-end workflows. It also creates the technological backbone for scalable AI capabilities across our portfolio and helps us to meet the increasing demand for AI-driven solutions. And finally, in business enablement, we continue to enhance operational excellence across the Nemetschek Group. Artificial intelligence also plays an increasing role internally, for example, in software development, service and support. And we are, therefore, increasingly leveraging AI to further enhance efficiency and harmonize processes for the group. Taken together, these strategic priorities provide the foundation for continued innovation, strong growth and long-term value creation. Coming to the end of our presentation on Slide #14, building on a very successful financial year 2025, which partly benefited from M&A contribution as well as temporary positive effects related to the successful completion of the subscription transition of Bluebeam, we aim to continue delivering attractive mid-teens organic growth in the coming years while further advancing our strategic priorities, most importantly, our transformation into a vertical AI leader in the industries we serve. Looking ahead to the financial year 2026, this means that from today's perspective, the Executive Board expects a currency adjusted revenue growth for the Nemetschek Group in a range between plus 14% and plus 15%. At the same time, the EBITDA margin for the Nemetschek Group is expected to expand and be between 32% and 33%. Based on our strong fundamentals, we expect to continue our strong attractive growth trajectory with high profitability going forward, even despite a high comparison base as well as the ongoing subscription and SaaS transition of our business model. Please keep in mind, these forecasts are based on the assumption that the global economy and industry-specific conditions will not deteriorate significantly during the current financial year. In addition, it is expected that the war in the Middle East will not escalate further or persist for a prolonged period. And with that, I would like to thank you for your attention. We are now happy to take your questions. Operator, please back to you.

[Operator Instructions] And the first question comes from Gerard Christholm from UBS.

It's Gerard on for Michael Briest at UBS. Our first one is on the contract assets and the multiyear deals. In 2025, there was an increase of about $30 million to the contract assets. Should we think about that as a reasonable proxy for the volume of new multiyear contracts signed during the year? And as we move through 2026, do you expect contract assets to continue rising at a similar pace? Or should we expect them to stabilize or even decline as existing multiyear deals unwind and then also billing patterns normalize? Second quick one, just on capital allocation. Famous AI was, I guess, implied around 40x sales. How should investors think about that multiple in terms of the strategic value growth optionality that, that asset provides and then also comparable companies? And then what's the pipeline for kind of similar tuck-in or platform expanding acquisitions going forward?

Let me take first your second question on the capital allocation. So it is clear that we are scouting many, many type of M&A targets. These are either small AI start-ups, either some of them we are invested in, but a lot of them we are not yet invested in, and they are currently planning potential exits. It's true that the multiples of such AI companies are much higher than the traditional software or vertical software companies. Nevertheless, if you take the example, for example, of our latest M&A on AI, which was Famous AI, the multiple was around 15x forward ARR, which is still reasonable. And then at the end of the day, we are also talking about start-ups, which have not been able yet to scale too much. And therefore, we are talking about very, very low revenue and in some cases, almost no revenue. So here, when we are looking at AI start-ups, we are mainly looking at buy versus make, accelerating our AI road map and therefore, it is more a technology acquisition than necessarily buying a lot of revenue. Therefore, the valuation maybe sometimes higher multiple, but the full amount of U.S. dollar or euro is still reasonable versus our capabilities of our M&A power. Of course, we are also looking at bigger M&A activities, similar to GoCanvas size or even much bigger. And here, it is not about necessary AI, but making sure that we are able to complement our overall offerings, therefore, increasing even more our domain expertise in some specific segments, for example, in AEC, also having more better trusted relationship with customers. And of course, at the end of the day, having more access to very strong data intelligence industry solutions. And here, of course, when you look at more traditional software companies, they are more in the valuation multiple range as Nemetschek or even below.

Okay. Let me then answer the question on the contract assets. So the contract assets, as you know, they represent the unpaid portion of the revenue that we have recognized in relation to the multiyear contracts. So it's not necessarily a one-to-one combination, 1:1 translation of the additional revenues from multiyear contracts in 2025. But it's a very broad proxy, it goes in that direction, as you're saying. And so you stated the EUR 29 million. This is the increase in 2025. You should note though that we -- when we prepare the 2025 financials, also decided to specify the presentation of contract assets a little bit. And that's why there is also an increase that will not showed in 2024, approximately EUR 3 million, that should -- if you want to make it like-for-like, that should be in '24. So the increase you can say is about EUR 25 million, EUR 26 million, something like that. And if you look at that going forward, of course, a part of that will, so to say, go away in 2025 and you add a new one. So that's why the increase in 2026, we estimate somewhere around half of the book value of this. So around the mid-teens is what you can expect for contract assets addition then in 2026. I hope that helps.

Then the next question comes from George Webb from Morgan Stanley.

Firstly, on the Build segment, as we look into 2026, how are you expecting new customer acquisition within the growth mix looking this year? And perhaps you can talk a little bit about both sides -- both the kind of important sides of that coin, so Bluebeam as well as GoCanvas? Secondly, on media, we've seen some of those headlines around the diversification measures you're doing in terms of the end markets you can sell into, but also kind of bearing in mind those AI considerations, how confident are you that media business can accelerate and deliver high single or double-digit growth and particularly thinking beyond 2026 when that payment service provider base comp effect drops out? And then just lastly, with regards to AI and particularly as we start to think through the Agentic tools, which have been coming out over recent months, curious as to the extent it's led you so far is maybe influencing your decision-making around future hiring plans and the operating leverage that sits in the business?

Thanks, George. So first of all, if you look at the Build segment, I mean, as you have seen, we have very, very strong momentum since few quarters, many years. and the momentum is growing, growing and growing. Of course, we have a higher comparison base now. Therefore, in terms of pure revenue growth, you can expect that in 2026, the first half and especially Q1 will be higher in terms of revenue growth for Build than the second half, where you will see kind of more normalization of the revenue growth. Nevertheless, of course, growth is driven a lot by Bluebeam. Of course, very pleased with Go Canvas. Growth is clearly in the plus 20% revenue growth. But clearly, Bluebeam has a very, very strong potential. And this potential is, as you know, not only in North America, where we still have the majority of our customer base, but where also the penetration of Bluebeam is only at 40% to 50% with large accounts. Then we have this long tail of subcontractors and smaller AEC firms in North America, where we have a very, very big network effect. And therefore, we see some very strong user growth in North America. Addition to that, as you know, we have this huge potential of growth internationally, Bluebeam, where we don't have very strong competition, but where we need to educate the market about, okay, what Bluebeam is and what Bluebeam can do. It is not only a markup on PDF to do collaboration software. it is also a tool to help you on the quality output, on productivity gain, on doing quality takeoff, doing estimating, et cetera, et cetera. And therefore, great thing is that when people are using Bluebeam, there was a very quick productivity gain and very quick ROI, especially as the price is so low. We are always saying that the price of Bluebeam per year is less than the price of a coffee per day, especially depending on it's much less than the price of a coffee per day. So clearly, the Build segment momentum is coming from new volumes, new users. Of course, new users coming from existing customers, but majority of the growth is coming from just new customers alone, especially internationally, but also in the U.S. Of course, this will be more in the U.S. SMB when you talk about new customers because all the large customers are currently Bluebeam customers. But then internationally, yes, we are doing good in Sweden, for example, we are doing okay in U.K. We are doing much better, especially the last 18 months in France and Germany, but still here, huge opportunity of growth. And then Spain, Italy, Eastern Europe, Benelux, still a lot to do. Asia, we are starting from a very, very small base. We have almost nothing there, especially just a little bit in India. Japan, no presence. Middle East, we are just starting. Africa, nothing. And of course, Australia Pacific doing very well, but where we see still a huge opportunity of growth for Bluebeam. So yes, Bluebeam and the Build segment, we still see huge potential of volume growth for the coming years. And then, of course, and we can maybe answer that in one of your questions, which may come up. It's also how AI is going to be a tailwind also to increase our average revenue per user across the entire portfolio for Nemetschek Group, but of course, first, over time on Bluebeam with Bluebeam Max. To answer then your question on media. So clearly, we have seen that media in Q4 was still in a recovery mode. And the growth is better as we can see already now in Q1 2026. I mean it has been much more normalized. We are expecting for the full year of 2026, Maxon to have a revenue growth of high single digit, potentially close to the around 10% revenue growth at constant currency because a big part of the revenue of Maxon is in the U.S. But clearly, I mean, the end market of Maxon is facing a lot of issues, especially in media and entertainment since many years. And therefore, they are spending much less. And this is not a threat necessarily coming from AI yet. It is just that our customers are spending less. There is less content production, high-quality production of content, et cetera. And this is why, as you know, we decided to accelerate the diversification of Maxon and in particular, now first in AEC, where we have launched Redshift RVs for Maxon, first on Vectorworks. And by this summer, it will be also available on Autodesk Revit and then at the end of the year, also on ArchiCAD. So Maxon Redshift [ RVs ] is state-of-the-art. I mean, of course, we are saying best-in-class rendering software solution for architecture. Then in addition to that, on the diversification front, we also announced earlier this year in January at CES in Las Vegas, some preview of our Maxon Digital Twin product, which is still under development, but Maxon Digital Twin transform CAD and 3D models into photorealistic digital products. And it's designed for today's multichannel marketing pipelines. So if you want this digital twin is an upcoming stand-alone application, which will power a new workflow for creating and using high fidelity digital representation of real-world products, projects or watch or whatever across modern marketing and brand design pipelines. So it is intended to help brands and marketing teams maintain visual accuracy, consistency and creative control as products moved across formats, platforms and tools from traditional design software to AI-enabled application. In addition to that, with Maxon, we also announced, as you may have seen at Mobile World Congress in Barcelona a few weeks ago, a strong partnership with Tencent Cloud HY 3D AI engine, which we are now entering into Cinema 4D. So Tencent HY 3D AI engine is a best-in-class worldwide 3D AI model, which is really trained by, of course, a lot of data coming from Tencent, especially with all the games that they have. And we are planning to launch that in the next few months. First, with an integration with Cinema 4D, then, of course, also fully integrated with the rest of the product portfolio, also with Redshift, Red Giant and of course, Zbrush. So this is going to help us now to diversify our portfolio to really embrace and more tap AI functionality to help our creative artist customer and really use AI as a creative accelerator, but then also to tap Maxon into this high growth in AEC because if you look at the AEC rendering software, so rendering solutions for architecture, we are talking about very, very high double digit growth of the market for rendering software for architecture. Of course, it will still represent a small piece of the total revenue of Maxon for the short term, but we strongly believe that Maxon can still continue to have higher single digit, close to 10% revenue growth for the coming years, thanks to that. And then on the AI agentic tools, clearly, I will let also Louise comment here that we have made a lot of progress in the last few years. We are partnering, of course, with many different technology suppliers, including Microsoft. We are working with Anthropic and of course, also Google Cloud on this front to really be more efficient in software development, in customer support. And therefore, as we are somehow improving on the cost side, but then we are, of course, reinvesting these cost savings in high-growth potential, especially high potential around AI, where innovation is key and not cheap, as you know, to hire key AI talent, of course, focusing on our growth in general, especially on the go-to-market front and internationalization.

Yes. And I think the only thing I would add to that is really we already see very positive impact also across the board in our functions, really with higher productivity, et cetera, we're using AI tools. But you can see the trend is a little bit also, you would see that going forward, the number of people we are hiring will go down. So that growth will be lower. But the people that we do hire, as Yves alluded to, they have a tendency to be more expensive as we hire to say the real [indiscernible], in our area, it's all about domain competence. Of course, domain expertise has always been the case. But also, of course, now when we look at other areas, so you need more to say the people that we hire needs to really be the higher competency as well. So you can see a shift there. But I think the positive is that we across the board and across all functions, we see nice impacts already from the AI initiative that we have launched. And that's -- I cannot really think about any function that has not been up that very nicely.

That's great. Maybe if I could just very quickly come back on the prior contract asset question, Louise. You mentioned that mid-teens maybe expected increase in '26. How much visibility do you feel you have around that? And is that what you've baked into the guidance?

So I didn't get the first part of your question?

Yes. Just on that, you said the mid-teens million potential increase in the contract asset balance in 2026. Just about the visibility and then have you baked that into the guidance.

Correct. Yes, I missed that. Yes, that's also our assumption for the plan, of course, for 2026. We cannot -- as we have said before, we cannot really say that because we are not -- it's not our attempt to say to push that kind of contract. We use that as a tool to get our maintenance customers onto subscription, and that's depending on market and really to say also. Of course, as we move on, there are more and more markets that are more maybe less conservative about subscription moves, et cetera. So that's why it's difficult to say really this will really be the number. But we expect approximately what we have -- what I alluded to before, that's also our current best estimation for and also baked into the guidance.

Then the next question comes from Nicolas David from ODDO BHF.

I have two. On the first one, I would like to come back on the AI monetization strategy and maybe taking Bluebeam Max as a tangible example. Are you offering the AI components or features on this pricing at the pricing, which is attractive right now in order to attract more customers and increase your moat? Or are you already pricing that at what could be the midterm value of that already? And if it's the case, do you expect a meaningful impact on your top line by 2026 or maybe more 2027? And also in terms of pricing, what would be in theory, the ideal price uplift linked to those AI features? And my second question is regarding Germany. When you look at your numbers, it looks like you had a nice improvement already in H2 in Germany. Is it linked to deployment of Bluebeam? Or do you see also an improvement in the design segment there? And what do you expect for 2026? Do you expect this recovery to firm up?

Thank you, Nicolas. So first of all, on AI monetization, so it's very depending on the brands and the strategy and the road map. But let's go with the example of Bluebeam Max as you requested. So we launched Bluebeam Max a few weeks ago, first as planned, first for our large Bluebeam enterprise customers, mainly first in the U.S. And then by mid-end Q2, we are going to also have Bluebeam Max available for our channel partners. So today, it's only our own sales force able to sell that directly to our large enterprise customers. It's more towards the end of the year that Bluebeam Max will be available on the web store for everyone. And we are doing that in a phased approach to make sure that we have the relevant also feedback from the customers, et cetera, et cetera. Now how we are pricing Bluebeam Max? Bluebeam Max is a purely centric AI package. So we are really saying that as an AI package on top of the current Bluebeam packages. If you are a new user and new customers and if you want to have Bluebeam Max, you will pay as an introductory price 2026, USD 590 per year per user, where if you take today the premium package of Bluebeam, excluding Blue Max, the price is around USD 440 per year per user. So it's around $150 both the current price of Bluebeam premium package. So it's an introduction price, which means that we may potentially increase this price further in the future. But of course, we want to see first the reaction of the market. We introduced already Bluebeam Max to beta customers in end of last year and of course, in January 2. We got some very, very good feedback. So we had hundreds of tester. And the beta user feedback is very, very positive. The features are, first of all, on [ ag ] markups to prevent rework and repetitive workflows. This is really creating value for people who are doing heavy reviews and who are executing takeoffs. We have features like automated stitching. We have also integration with Claude and in the future with other AI agent via [ MCP ]. We have also connection with Revit sessions automatically connected with Bluebeam Studios. We have smart overlay AI drawings comparison. We have smart review, AI plan checks, et cetera. And all of that really is really helping to gain a lot of time and therefore, making more efficient and productive the people using Bluebeam Max. So already Bluebeam has a strong ROI. But here with Bluebeam Max, the feedback that we received from the early users is that the ROI is even stronger. Therefore, they will see the value and therefore, they should be able to be ready to pay for it. I mean that's a big assumption. As you know, the construction industry is highly, highly conservative. I used to say that hunting and fishing are more -- are less digitalized than construction, but now even fishing is more digitalized. That's a little bit the issue is that as it is a very conservative, highly regulated market, let's see how much and how fast the adoption of AI features will be. The good news is that positive feedback. Are we expecting big revenue out of Bluebeam Max in 2026? No. We are forecasting that in a very, very conservative way, too. But of course, you can see that the potential could be highly significant in the future to really help us to increase our average revenue per user with Bluebeam over many, many years. Now of course, when you look at Bloom Max road map, today, it's -- the pricing is USD 590 all-in per user per year, again, as an introduction price. As we are going to launch additional AI features, capabilities and AI use cases on Bluebeam Max, you can see that the pricing will probably evolve to be hybrid where people, yes, we need to license the tool. Then in addition, there will be more consumption-based, token-based type of pricing, which will be kind of a hybrid model. So we are not planning to sell solely our AI features on consumption. There will be always a mix, especially for the short to midterm of licensing a tool, and that's also for the design division, not only for build, plus token-based, consumption-based pricing model. Then to answer your second question on Germany, yes, there is better momentum when you see the market and when you talk to customers. Nevertheless, we are not fully there on where we need to be in the German market. There are still a lot of issues. Yes, there is a lot of hope that the EUR 0.5 billion investment is coming soon in the market, but we do not expect huge needle mover in 2026, hopefully, in 2027. But the good news is that there has been already in the last weeks and months, better momentum with, for example, in Germany, an increase in building permits. So that's already a good sign. Nevertheless, still a way to go to see all these euros being invested and monetized properly in the market. And then if you look at '24 and also in 2025 in general and also what we see now in 2026, the nice growth that we have in Germany is, of course, coming from Bluebeam, where we had a lower base. So of course, the growth percentage is bigger. But then also design is helping significantly and of course, some 3 years contracts where there are some 3 years contracts in Germany, only again for Graphisoft and for Allplan, but for the rest of the design brands. And we are using also 3-year contract in Germany as it is probably also a little bit more conservative market than other markets internationally to help our existing customers to move to subscription. And then, of course, we had last time buy our fare license for design, especially with ArchiCAD in Germany, in particular, which also helped the boost end of Q4 2025.

And the next question comes from Alice Jennings from Barclays.

So I just have a question on AI. I mean, obviously, you've spoken a lot about the opportunity of kind of becoming a leader in AI and some of the initiatives and the product portfolio, including Bluebeam Max. But could you possibly just take a bit of a step back? And if we think about kind of the medium to long term, how do you see AI as really transforming the business and also the industry? So for example, how do you expect like your go-to-market strategy to change, but also the way that you sell the products? And then, I guess, more generally, how will the way that you kind of run the business evolve in the age of AI? And then just a second question on the outlook. So I mean, you spoke about media expecting to grow high single digits this year. But could you break down the growth by the other divisions in '26, so design, build and manage?

Sure. So if you look at AI, many, many impacts. And as we all know, this is a huge revolution transforming the way we work, we live, we learn. And of course, this will also change our end customer markets, including in AEC. Obviously, the pro and the cons is that the fact that it is a conservative market. And unfortunately, our market is probably moving slower than other industry in terms of AI adoption. And in particular, also because we are not really enterprise-centric type of business, but majority of the revenue is coming from small, medium-sized businesses. And if you look at our design segment, it is mainly coming from super small businesses, very small architecture firms with 2, 3, 4, 5, 10 maximum seats. So here, the good thing is that we see that the adoption is growing for AI features with our customers. First, it started with architects. When we launched over 2 years ago, the AI visualizer, it was seen more as a gadget. But now that we're introducing more Agentic AI solution with our Nemetschek AI Assistant across our portfolio, especially first with ArchiCAD, they see that this is going to help them to really be more productive and efficient and kind of tapping the full power of, for example, ArchiCAD or Vectorworks of Allplan versus what they currently use. As you know, probably same case for you, you use a software, maybe you use 20% to 50% of the capabilities of the features, which are there. And here, thanks to the Nemetschek AI Assistant, when you prompt for specific task, it will use the full power of the tool. And of course, it will help, for example, if you're an architect and you say, well, I just built this school now in Zurich, and I would like to take exactly the same design of this building to build this school now in Nuremberg in Bavaria. And here, instead of spending days and weeks of trying to redo your model, the Nemetschek Agentic solutions is going to help you to make sure that all the specific regulation linked to Nuremberg and Bavaria are going to be automatically done, et cetera, et cetera. So our AI tools are here to really help them to have a completely different user experience, to have a copilot in their work to really to become a augmented architect, augmented project manager, and augmented structure engineers, et cetera. But for this customer base, what is highly, highly important is reliability of the output that they get from these AI tools. So the trust factor is huge. And the good thing is that our user base, which are defining themselves as fans, they trust the product because they are using ArchiCAD or [ Frilo ] or [ SIA ] or Allplan for many, many years. And if you are structure engineers using [ SIA ] and [ Frilo ], you cannot accept that it's going to be only 99% reliable. You need 100% accuracy. especially in structure engineer engineering, et cetera. So here, we have this trust approach, which is really a network effect, which is probably differentiating ourselves via a newcomer, where they will not necessarily trust what is coming out from the tool, where here is our tools and solutions that they are using many hours per day on a very regular basis, and they are fans of these tools. Of course, what we would like to see as a potential disruption in the overall market is to see instead of having just short term as we do agentic AI functionality to help our customers to be more efficient and productive using our tools in a segmented approach, which is what construction life cycle is today, is to see we can look at construction in a more systemic approach. which today doesn't exist really because it is not systemic. It is highly fragmented. It's mainly silos. And here, there are probably some segments in construction, if you look at simple residential buildings, for example, where potentially we can have a more systemic AI flywheel type of solutions to streamline even much more the workflow between the different segments in this workflow and therefore, even accelerate further what AI capabilities can be and therefore, reduce time to market, reduce costs and therefore, be more efficient, productive and efficient. So of course, this is more I wish and something that we are working more on Horizon 2 or 3. But Horizon 1 is clearly to use all Agentic AI capabilities and power to help all different segment type of customers across the life cycle to be more productive and efficient and sustainable. On our side, and as any companies in the world, AI is going to change fundamentally how we are organized. Target operating models will change over time. And as we are really focusing on being more AI first, of course, as Louise also explained, yes, you may see that over time, we're not going to increase net year-over-year -- too much our headcount. Of course, we will still. But we will have more and more agents working across all our different functions. It is how we are going to manage properly this hybrid workforce between human and agents and therefore, potentially also changing more and more our target operating model over time. Of course, this is not something that is going to happen too quickly, but we see already some fundamental improvement and changes, especially in software development, in customer support on the go-to-market side, of course, if you look at digital lead generation, what Agentic AI can help. If you look at how now also our sales teams and go-to-market teams are using currently available AI solutions for sales, et cetera, it is really helping them significantly to be more efficient and productive. So we see definitely a productivity gain and efficiency gain and hopefully, a top line increase, thanks for using internally more AI functions. More importantly, I think where AI is really changing the way we work short term now is in product management. So a product manager who is the CEO, General Manager of their product line, now they can really much faster prototype, new ideas in a few hours, in a few days, maximum with very, very small team. We're not talking about doing an MVP in 1 year or a few months, just with a handful of person, you can already do a lot of things in less than a week or even sometime in just a few hours. So this is really a huge change, huge change on how we are working. And the overall work of product management, especially in vertical AI companies such as what we are becoming is a very fascinating new role compared to what it used to be because now don't only define, but you can do yourself type of prototyping with a very, very small team. So very exciting times.

I think, Alice, you had a second question on the outlook for our other segments as well. So let me just briefly touch upon that. And so we alluded to media already. So if I go into design and bear in mind that design is still impacted by the very successful subscription transformation in 2026 as well. The transition to a fully recurring revenue model, subscription-based model of Design segment is expected to be seen at the end of 2027. So 2026 is still continuing there. So that's, of course, how to reach the growth rates. But we still expect despite this effect we still expect a high single-digit or low double-digit percentage growth for the Design segment, driven by many of the reasons we just touched upon. For the Build segment, of course, the very strong momentum will continue. We alluded to before what the additional extraordinary effects were in terms of growth rates, relative growth rates in 2025 that we will not feel in 2026. So that's a normalized level at a very high level that we see in 2026. And that's why we expect the Build segment as a total to be -- the currency adjusted revenue growth to be somewhere in the low 20s, low 20s percentage range. and which is, of course, at a much higher absolute level, right? So what Yves alluded to at the beginning as well. And then last but not least, we see this positive effect in managed that we already saw in the Q4 in the fourth quarter, as we already alluded to that the measures that we are taking into the segments are really coming through. So that's why we expect a growth year-on-year in the low double-digit percentage range in this segment.

Then the next question comes from Nay Soe Naing from Berenberg.

I've got two questions, please. The first one is on the Bluebeam Max introductory pricing at EUR 590 on your base tier at EUR 440. That sounds like a very nice price uplift. And obviously, this is only introductory of the price. So the potential price uplift could be even more. So I was wondering how much of growth from pricing contribution should we expect for this year and beyond? And my second question is maybe one for Louise. We've spoken about the benefits of the multiyear agreements and design in '25. It sounds like there's more of these benefits to come in '26. So do these benefits at some point turn into growth headwinds? And if so, when that might be the case?

Thank you. So on Bluebeam Max pricing, as I said, yes, it's introduction price EUR 590. Are we going to increase that significantly or not? We cannot answer this question yet. We need to see the reaction from the market, the adoption. It will probably increase, but it could be only slightly. We don't know yet. So definitely, for 2026, you should not see any important price uplift impact coming from that. It will be very, very minimal. And for 2027, we will see. So I think it's too early to say. In general, I mean, this is clearly a strong way, as you know, to increase our average revenue per user. Then in addition to that, as you also know, we not talking about AI with Bluebeam, we have a large legacy user base with 4 million users now. Not all are paid users because some of them, they used to be perpetual license customer who were paying subscription and then they stop subscription. But still, we have this big user base of customers. And if we are able now to upsell to some of them at the Bluebeam Max solution rate. But in addition to that, we could also, in the future, price increase, which we are not planning to. And it is not the strategy. So we are not planning to increase the current pricing over the current customer of Bluebeam. We will only start looking at that if we see that we have a huge impact on volume growth of new users and new customers over time. That will be the lever. But for the time being, the average revenue per user increase will only come from new functionalities such as Bluebeam Max, but potentially others to come in the road map in the next few quarters.

And then let me take the question regarding the multiyear contracts. Yes, you're right. We continue in 2026 for Graphisoft and Allplan. And we don't see -- however, we see approximately the same volume as I alluded to before. So we don't see any additional tailwind multiyear contracts in 2026. And looking ahead, of course, at some point of time, that effect will sweat out, so to say, that's clear. But you will have to see also that already now, we have also balanced the effect of less perpetual licenses in the last year. So that's the balancing. And you also see we are growing -- a strongly growing segment in the Design division also. This is just a small part, the multiyear contracts is impacting the revenues of the Design division. So we are also growing strongly also in our originating business. And that's, of course, until 2027 and beyond where you will see the comparable effects where these 3-year contracts, so to say, disappear in that respect, that will then balancing out. So we don't expect that, that will be, so to say, at some point of time, a strong and severe hit out of that. But of course, you have counterbalancing effects also in the next couple of years. The Design division, as I said, is planning the design -- the transition to subscription to end with the end of 2027, we should be through with that transition.

And the next question comes from Joe George from JPMorgan.

I have two, please. Firstly, just on design organic growth of 6.5% in Q4. Can you just confirm what organic growth was excluding the contribution from multiyear deals? And then can you also please confirm if there were any other tailwinds to growth during the period, for example, from final time license sales in any of the brands? And then second question is just on the phasing of Bluebeam and build growth for 2026. You mentioned an expectation for stronger growth in H1 versus H2. But are there any fundamental reasons that growth would be stronger in H1 versus H2, given that we're already now at quite a mature point in the subscription transition, and there doesn't seem to be a major difference in the organic growth comparables between H1 and H2. So I guess, does the guidance just reflect law of large numbers and some conservatism? Or is there a fundamental reason for slower growth in H2 versus H1?

Thank you. So maybe on the phasing for 2026 first, clearly, here, there is phasing. If you look at design, the phasing is a main fact that we have a lot of renewals coming end of the year. When you have a maintenance customer who were used to pay perpetual license and then they are an SSA, a lot of them do their renewals in Q4. Therefore, we have a very strong Q4. And therefore, as it is a Q4 where we are planning to also migrate a lot of this now existing maintenance customer to subscription, this will have a significant impact on the revenue contribution. So that's mainly the main factor on design. Then of course, in design, you have some volatility and it is very cyclic quarter-over-quarter. Sometimes in case of, yes, some of these multiyear deals that we used to have in the past. So you may have in 1 quarter or 1 month a lower comparable or higher comparable, et cetera. So of course, this will normalize in the future. But that's the main reason for the Design, the fact that design in H1 growth will be lower than in H2. Then if you look at Build, so Build is slightly lower growth in H2. It's not coming from the fact that the business is going weaker because we still see huge momentum also planning forecasted for Q3 and Q4. But we have a large number and it's getting harder and harder to grow, of course, 30% on a strongly increasing revenue base. So it's just the fact that we have a bigger base and therefore, the percentage -- the number of users or new user growth might be still the same, but it's just that the base is higher, and therefore, the percentage growth will go lower over time. So that's the main driver. And of course, if you go back to Design, we had also last year stronger perpetual license for some quarters, especially when we had end of sale of some products, also had some peaks in some quarters in 2025. That's also impacting the seasonality of the growth for Design in 2026.

Yes. I think to end that with the Design organic growth, as you said, it's all organic growth. But as I say, taking out the growth impact of the multiyear contracts for design in Q4, that will be approximately slightly south of 4 percentage points out of the 6.5% that you mentioned would come -- is the contribution from that. But bear in mind the very, very high comparables that we had out of the Q4 2024 for design. That's why with these numbers, Design are still ahead of the original forecast for Q4. So the organic to see the underlying growth was still stronger, but you can calculate and see slightly south of 4 percentage points.

And the next question comes from Victor Cheng from Bank of America.

Congrats on the solid quarter. I know you touched upon Bluebeam Max a couple of times now. But if we can double tap on it, can you give us some more color on with the beta testing and whatnot, I think anyone with an active license can try out the beta feature. You talked about hundreds of testers. I guess I was somewhat expecting a bit more given maybe closer to 1 million of active users with Bluebeam. And it seems like online, they're suggesting that there's some -- to some extent, a delay or another round of beta testing. And then maybe second question is more kind of any update. Can you provide us some color on some of the momentum Q1 to date? I think you've mentioned media entertainment already improving, but any color as well for other segments, please?

Sure. Victor. So to be very clear, on Bluebeam Max, it is exactly as planned. There are absolutely no delays. And we have already paid customers. It's not only beta. So as I said, we are doing that in a phased approach, and that was the plan. So the plan was to first launch Bluebeam Max commercially to large enterprise customers and to only have our sales direct team selling and pitching Bluebeam Max to these large existing enterprise customers, especially in the U.S. to start with. And this started already last month, and we have already some paid customers. The beta tester, it is more -- it was a case by case. Now of course, you can go online and try it, et cetera. But as you will see, is not so much marketing around Bluebeam Max on Bluebeam website. We are very cautious because, again, on channel, we will only have resellers being authorized and not all at the same time to sell Bluebeam Max more in May, June time frame. And then it will be only available on the web store more towards the end of the year. And why we are doing that is that because we really want to make sure that we have clear feedback and we have a measured approach on how we sell Bluebeam Max. So Bluebeam Max is ready and not only ready, but it's already -- we are already generating revenue out of it. Of course, small amounts because it's only for some large enterprise customers. But still, we have around 2,000 of enterprise and strategic accounts that we are starting now to -- since a few weeks now to pitch a little bit more directly with our direct team, Bluebeam Max. So I hope this is answering the question.

Yes. And I think just to link that, that's very much in the normal Bluebeam approach that you will see. You saw that when we transided to subscription as well. We spend a lot of time together with our customer to make sure that we take feedback, implement that, et cetera. We have a huge user base. And you know that Bluebeam is adding so much value, and that's always top of mind. And that's why this approach is very much alike other approaches we have been taking as well. And just to clarify on the beta, as you say, the beta, when we had the beta testing that was before now we have the first paying customers now since end of February. But for that beta that was really selected signed up beta customers when we talk about the beta customers. So it was not anybody testing. It was, let's say, a select after Bluebeam unbound where we have, so to say, signed up beta customers that did all the testing for the -- in the first batch to say. So that's maybe where the different terminologies come from.

And then on the second question regarding Q1. So of course, Q1 to date, we cannot comment too much on it. You should expect a good momentum still as we had also in Q4. We do not see any change in the end market dynamic. Europe is not going much, much better than before. Of course, we don't know what will happen in the Middle East. Middle East represents only a small piece, of course, very, very small piece of the total revenue of the Nemetschek Group. We only started really to be present, as you know, directly with our local presence in May of 2025 with the launch of Nemetschek Middle East in Riyadh, Saudi Arabia. But as long as this war in the Middle East is not going to take forever, hopefully, and that the overall economical situation in the world is stable, we do not expect a big drama for the next few weeks before the end of this quarter, before the end of this month. So you should expect us to have a solid quarter again for 2026. Of course, again, there is volatility, especially in design, where the quarters, Q1 especially will be lower than for design growth than for H2.

Then the next question comes from Balajee Tirupati from Citi.

Two from my side, if I may. First one, I appreciate Nemetschek vision of becoming a vertical AI leader. Towards that, how could you -- towards that, could you share your view on how important is integrated platform approach versus interoperability and open ecosystem? And then second question is on cash flow. Nemetschek's cash conversion has consistently improved. And even adjusting for one-off effects in 2025, the conversion does appear to be ahead of 100% for both 2024 and 2025. And given this increased conversion has happened when multiyear deals have been accretive to revenues, it appears even more impressive. So as an analyst community, how should we think about conversion going forward? And is 100% or more than 100% cash conversion new structural normal for Nemetschek?

Yes. I can start with the cash conversion. And that, as you say, there are always in each -- I mean, you know how it is with cash flow, you always have some extraordinary effect, et cetera. But I think you're reading that. And as I alluded to before, that we expect our cash conversion to be at or above 100% also going forward. That is in line with our expectation and also our planning. And that is, of course, driven by the recurring revenue models, right? So it's a little bit -- is a slight front load of cash for the revenues due to the, to say, over time recognition of revenue. So you could say that when we are absolutely done with the transition to subscription when we are on a fully subscription-based model, then you could see that we say that balances out a bit. But you should not forget that we are a strongly growing business. And that's why we expect, so to say, in the next years, and let's say that's not only in 2026 and 2027, but to say longer term, we expect a cash conversion at or above 100%, not necessarily the 109%. As I said, there can always be a special effect, but this is, say, in this range is something that you should be able to calculate with.

And on the vertical AI front, so again, so we have two approach. So we have this brand-centric approach where we integrate Agentic solution on top of our tools. And we have also this platform approach. So as you know, we are building this AI-first open multi-cloud layer across all our brands, which is centered on a group-wide AI assistant with also our horizontal collaborative data intelligence platform, which we are going to talk about in the next few months, which is going to drive this life cycle, building life cycle intelligence from design to operation. And we are clearly doubling down on our -- also on our foundation model, especially our data foundation model and bending the Nemetschek Assistant as an Agentic AI layer across all our portfolio from design to build. If you look at the Nemetschek AI platform strategy, so we are really focusing on a common AI layer and an AI assistant rolled out across all our flagship brands like ArchiCAD and Allplan, et cetera, and which is going to give user a consistent agent-based experience and cross-brand workflow. And it's also offering an open horizontal solutions, which is going to unify [ Beam ], [ IWMS ], but also third-party data coming from IoT operation data, which is going to enable analytics, simulation and AI-driven decision across the building life cycle. So a third pillar is clearly our partnership also with large technology players such as Google Cloud but others to really industrialize these AI-first capabilities and run also a multi-cloud environment and support global scale and sustainability goals.

Today's last question comes from [ Maximilian Pascode from Alfa Value ].

I have only one especially on the Build segment and the Bluebeam and GoCanvas synergy. I would like to know if it's possible to have figures between the synergies between the two brands, if we have some cross-selling in these brands?

So as you might recall, Maximilian, when we acquired GoCanvas, this was a very strong synergetic case, and we get these synergies also by really doing things together. We said from the beginning, we'll not continue to GoCanvas, so to say, stand-alone because it's very much about bringing this together and where the synergy really lands. If it lands, if you may, then on the original Bluebeam side or on the GoCanvas side, we don't really care because for us, it's one segment, and it's interoperable way of seeing those synergies and generating those synergies. It's difficult really to place numbers, and that's what we have said. But I think what I can allude to is that we have different categories of synergies that we had really targeted. And of course, we are razor sharp in ensuring that those are also coming through. And we really see that, that is happening. So we see good progress there, both be it that we use Bluebeam's channel partners, so to say, to use for Go Canvas sales. That's one thing, but also the white labeling of Go Canvas products into Bluebeam, also, of course, to access each other's customer base through upselling expansion and the like. And also -- and that's also synergy to use our international network also for the expansion, of course, of GoCanvas, something that they would have had a lot of -- needed a lot of investment into build up by themselves. So all in, we can see that this is going well in line with our plans as we have put it in the integration scenario. And that's why we also see a very positive growth of the whole Build segment as well. So we are very, very pleased with seeing the -- that it's difficult really to say this is exactly the amount of synergy coming from that or that. But we are -- as I said, we are very well aligned, very well in line with our assumptions as we had it when we did the acquisition. And you can also see that also the first products that we have now really combined where you combine and say with single sign-on between, et cetera. So I think all that is really what we said when we acquired the company, and we see that come through, and we're really happy to see that such a good acquisition into our books.

Ladies and gentlemen, this was the last question. I would now like to turn the conference back over to Stefanie Zimmermann for any closing remarks.

Thank you, operator. Thanks, everyone, for attending. We are looking forward to catching up with you next quarter. It is just around the corner. If you have any further follow-up questions, so please do not hesitate to contact Patrick or myself. So let's conclude our call for today. Thanks again for joining.

Thank you, everyone.

Thank you very much.

Ladies and gentlemen, the conference has now concluded, and you may disconnect. Thank you for joining, and have a pleasant day. Goodbye.