Superloop Limited (9SL.F) Earnings Call Transcript & Summary

Thank you for standing by, and welcome to Superloop Limited FY '25 Full Year Results. [Operator Instructions]. I would now like to hand the conference over to Mr. Paul Tyler, Chief Executive Officer. Please go ahead.

Thank you. Good morning, and welcome to Superloop's FY '25 Full Year Results Briefing. My name is Paul Tyler. I'm the CEO of Superloop, and I'm joined here by Dean Tognella, our CFO. We're incredibly proud of the results that we are going to take you through today, and I'm delighted that they once again show that our simplified business and low-cost operating model continue to drive market share gains as well as revenue and earnings expansion. Particular highlights for FY '25 has been the achievement of a positive net profit after tax result, our first since the commencement of our turnaround and achieved a year before anticipated in our 3-year DoubleDown plan. So with that, let's get into it. If you would turn to Slide 4, please. FY '25 brought an exceptionally strong financial performance across the board. By the end of the year, our total customers have increased some 60% to over 731,000 customers. Revenue for the year increased 31% to $546 million. And it's clear that our operating leverage is continuing with EBITDA margins expanding and underlying EBITDA growing at a much faster rate than revenue. Underlying EBITDA was up 70% year-on-year and ended at $92.2 million. As mentioned, this has resulted in a positive NPAT of $1.2 million, an improvement of some $16 million on FY '24. Our current 3-year strategy set a positive NPAT target by the end of FY '26, which we've now delivered some 12 months ahead of schedule, as mentioned. We also generated a gross operating cash flow of $88 million for year, representing a 95% conversion of underlying EBITDA to operating cash, very incredible results. Moving to Slide 5. Looking now in a little more detail across the group, we had a packed year of highlights. We achieved record NBN market share increasing by some 75%. In total, we added around 275,000 new customers. In the Consumer segment, revenue increased 37% and both through ARPU expansion and the addition of 63,000 new customers in the segment. In the business segment, new ends and volume gains enabled us to maintain revenue and margin position. And we are now seeing some signs of improving market conditions. Pleasingly, we exceeded our sales target in smart communities, signing a record 18,000 new lots and with 17,000 of those being fiber to the premise or TTP. Finally, in the wholesale segment, the contract with Origin continues to deliver great results. Driving record growth in revenue and customers, we successfully migrated 130,000 origin broadband customers to sublet during the year. Since the migration of further 83,000 new origin broadband customers have joined our network by the end of the year. Through enabling challenger retail service providers such as Origin, we continue to grow wholesale with revenue up 62% on the prior year. Group underlying EBITDA margin -- group underlying EBITDA margin, sorry, expanded, increasing from 13% in the prior year to 16.9% in FY '25. We move on to Slide 6. As you can see, we had record customer growth for the year, up 60% on the prior year, driving revenue up 31% to $546 million. largely attributable to the exceptional market share gains in our Consumer and Wholesale segments. With over 5 years of consistent subscriber growth, we now have over 70,000 customers on our network. The next slide, Slide 7, you can see that pleasingly that this trend of consistent customer growth has not come at the expense of margin. As you can see on the chart here, we have also demonstrated a trend of both profit expansion and consistent margin growth over that same period. On Slide 8, you can see the group revenue of $546 million was up 31% on FY '24. Consumer revenue increased 37% to $364 million both from ARPU expansion and strong volume growth with our consumer market share up 24% over the 12-month period. And despite sector headwinds, revenue from the business segment of $105 million was slightly up versus last year. We won a number of great contracts in the Smart Communities division, which I'll talk about more later in this presentation. The Wholesale segment delivered a record year with revenue growth of 62% to $78 million, with growth dominated by the company's contract win with Origin in addition to new revenue streams from AGL, amongst others. Moving on to the operational update. And Slide 10. The strong revenue growth is being driven by increased network utilization across the platform. This significant investment that we've made in physical and digital assets enable us to deliver our services at a lower cost, and we're now benefiting from operating leverage as our business grows. We have a great domestic and international fiber network, a modern integrated digital stack and a global resource base. On Slide 11, you can see a simple representation of that substantial asset base. The Uecomm acquisition completed during the year has extended our infrastructure each and cements our position as an owner of domestic and international telecommunications infrastructure. The assets are particularly well aligned with our Smart Communities division, and we see this infrastructure ownership conferring an advantage on us, both in differentiating our offering for customers and in reducing the CapEx requirements of that delivery. If we move forward to Slide 12. You can see that in the year to 31st of March, Superloop added over 250,000 new services, representing an additional 2.8% of the market. In total, Superloop then had 6.6% share of the NBN market. Through our retail and wholesale offerings, we ranked #1 on NBN net adds across the 12 months to 31st of March 2025, being the latest period with publicly available data. The challenges in the broadband space continued to increase their share at the expense of older legacy brands. And as of March 2025, collectively, we had 21.2% of the market. We believe this multiyear trend has plenty of runway and now see our long-term vision of the challenges as a group reaching 30% at somewhat under -- we are incredibly well positioned to benefit from this trend through our offerings. If you move to Slide 13, please. So as distinct from the NBN subscribers in the previous chart, Superloop acquired 275,000 total new customers in FY '25 and now services a total of 731,000 customers on -- 63,000 of those customers were added in the consumer segment. In the chart, you can see that adds in the second half was slower than in the first half. This was a deliberate consequence of decisions we made with short-term impacts, that set us up to take advantage of the market changes in the first half of FY '26. These decisions, including pausing the marketing of the Exetel brand ahead of the relaunch of the new Exetel 1 proposition launched at the start of July, which I know has been exceptionally successful today. I'll talk more about that shortly. We're also an early mover in repricing our plans ahead of the nbn price increases in July. This brought forward the usual attrition in the customer base. The rest of the market has clearly now implemented these changes as well. And with that, churn has normalized and momentum in FY '26 is very strong, validating the approach we took. Specifically, in the first 7 weeks of the year-to-date, we've added approximately 17,000 new consumer customers across the Superloop and Exetel brands. If you look at wholesale, customers grew by 198,000 customers in the year. And in the business segment, the number of customers increased by some 15,000. Slide 14. As I'm sure you're aware, in September this year, NBN is rolling out changes that will increase the demand for high speed in -- under NBN's so-called Accelerate great program, 100-meg plans are being upgraded to deliver 500 megs and there will also be new 2-gig plans. Based on research published by NBN, the market for 500 meg and above products is expected to grow from some 300,000 services in FY '25 to some 2.8 million services this year FY '26, further expanding to 4.2 million services by 2029. And this plays right to our strength, with both Superloop and Exetel ready to capitalize on the new high-speed opportunity. Our share of new 1 gig orders in FY '25 was 25% of the entire market. And we're confident in continuing to take market share as the high-speed segment radically expands from next month. We're particularly excited about the new Exetel 1 plant, $80 a month for a 500 meg service as are the 11,000 new customers who have taken up in the 7 weeks since launch to July. On Slide 15, you can see that during the year, we made significant strides an uplifting our ESG credentials, recognizing the fact that as we get larger, attract new shareholders and are included in new indices such as the ASX 300, we must continue to be proactive in meeting the evolving expectations of all our stakeholders. With that, I'll hand over to Dean to provide some more detail on the financial performance.

Thank you, Paul. It's great to be presenting Superloop's financial results. I will step you through our high-level results before I drill down into more detail. We are seeing continuing positive trading momentum within our segments. And this is driving strong revenue growth, up 31% to $546 million. The group delivered gross margin of $190 million, an increase of $45 billion or 31% on FY '24. Operating expenses of $103 million increased 12% overall. Our operating expense growth is well below our revenue growth and good operating leverage is being achieved. Underlying EBITDA grew 70% to $92.2 million, well ahead of our revenue growth of 31%. As Paul has highlighted, NPAT is now positive at $1.2 million and represents an improvement of $16 million over the last year. And lastly, Superloop continues to generate strong free cash flow, up $27 million to $56 million in FY '25. Now turning to gross margin. As mentioned on the prior slide, group gross margin of $190 million for the year represented an increase of $45 million on the prior period and the group gross margin percentage remained steady. Consumer gross margin increased by $25 million or 33% as a result of strong customer growth. The wholesale segment gross margin increased by $19 million. Lastly, the business segment was basically flat at the revenue and gross margin line with new wins and volume growth offsetting data price declines. Now moving to Slide 19. This slide is one of my favorites and really demonstrates the upside in the business as we continue to add customers on to our platform. Operating expenses did increase by $11 million to $103 million to support our additional scale with $2.7 million of this increase relating to marketing. However, it's clear we are delivering strong operating leverage. You can see the trend of reducing OpEx to revenue, down a further 2.9% ending at 14.4%. The efficiency built into our low-cost operating model continues to be a key to our success. Now moving to Slide 20. Total CapEx this year was $28.4 million at the lower end of guidance. We invested $12 million in equipment and infrastructure which further strengthened our network and enabled our growth. In support of our accelerating smart communities business, we increased our CapEx spend in this area. We continue to maintain our investment discipline, which is reflected in the CapEx to revenue decline we can see over the last 3 years. CapEx to revenue is now at 5.2% in FY '25. Moving to Slide 21. The business is generating strong cash flow. In FY '25, we delivered gross operating cash flow of $88 million, up 55% on FY '24. And free cash flow of $56 million, an increase of 93% on the prior year. The company has a net cash position of $29.5 million and a conservative debt position with debt covenants well below thresholds. Our significant debt capacity provides us with funding flexibility to pursue M&A opportunities that are aligned with the business strategy. And we remain focused on accretive growth. I'll now pass back to Paul for the segment update.

Thanks. Yes. So jumping into the segment update. We'll start with the Consumer segment on Slide 23, please. As I've already noted, the Consumer segment achieved great results in FY '25, increasing revenue by $9 million to some $364 million for the year. We added 63,000 customers during the year and we continue to achieve great success in particular with those high-speed plants. Gross margins came in at 27.4%, remaining comfortably above our 25% long-term target. As mentioned earlier, in the second half, customer adds were lower than in the prior corresponding period as we did an early reset of pricing and poured the marketing in Exetel. These decisions were deliberate, and I'm pleased to say they set us up for the great momentum that we are now seeing in the period since July 1. Specifically, it's encouraging to note that we've added approximately 17,000 net new customers in the consumer segment in the first 7 weeks of this financial year across the Exetel and Superloop brands. I move to the wholesale segment in Slide 24. You can see that our strategy of enabling Challenger brands has led to a record $198,000 increase in customers in the Wholesale segment for the year. Revenue came in at $78 million, up 62% on the prior year. And gross margin came in at 61.1%, which is also above our long-term target for the segment of 60%. Customer numbers in the second half were impacted by the expected loss of the 17,000 Symbio customers, which migrated to their parent company as expected. And then the business segment on Slide 25. In this segment, there were signs of improving market conditions. We are at the tail end of the repricing events that we previously discussed. -- and new wins and volume gains enabled us to maintain revenue and gross margins despite the sector headwind. Gross margin percentage was 40.5%, which is also above our long-term target of 40% for that segment. Pleasingly, business NBN customers increased by some 11,000. And we achieved strong sales in smart communities with a record 18,000 lots secured, comfortably above our sales target for the year. I'd like to spend a bit of time on the Smart Communities business, which you can see on Slide 26. I'd spend the time on it, as we do see it as a long-term, high-quality growth engine for the company. In contrast to our other segments, which are primarily focused on existing brownfield premises, our Smart Communities business builds and operates new greenfield FTTP and WiFi networks. Our markets are broad acre developments with customers such as Resimac and AVJennings, residential apartments and mixed-use developments, which leverage both our FTTP networks and our Intelligent WiFi solutions built to rent development, which include customers such as Mirvac and Investor. Mark community and public WiFi for customers, including the Sunshine Coast Council and finally, managed WiFi for student accommodation offering -- offered by customers such as uni large, campus living, [indiscernible] and others. A key feature of this business is that it is all on-net for Superloop, and does not involve the reselling of access networks such as those from NBN. Naturally, the nature of such on-net business represents a long-term annuity style wholesale revenue and dramatically superior margin profile. On Slide 27, you can see some landmark sales win for the division. Perhaps the highlight of FY '25 for the Smart Communities team was in the signing of 10,000 new lots for the Bradfield heavy development with the New South Wales government. In total, we contracted 18,000 new lots in that past year, taking our total to 97,000 contracted lots. Of these, 55,000 are connected with 44,000 of those active and billing today. We also have a further 42,000 lots contracted but yet to be built. We are seeing build activity accelerate and look forward to the steady increase in our billing lots over the next few years. On Slide 28, you can see some of the opportunities that we signed during the year. So looking forward, if we jump to Slide 26, please. So in July, we relaunched the Exetel brand with the new Exetel 1 plan. The 1 plan is a 500 meg service that focuses on simplicity, with bold, eye-catching branding. We've ceased offering any legacy products under the Exetel brand to new customers, and they're only selling the 1 place, a single plant, single price no limited -- no time limited. Everything is AI and digitally led with customer support available exclusively through the app and web-based chat. Slide 31. We're targeting a particular demographic with this plan. The tech savvy, time poor value seekers that are typically GenX or millennials. They are digitally confident and also value conscious. In meeting their expectations, the One Plan delivers high service levels demonstrated by the fact that over 86% of orders placed are activated within 15 minutes. We've seen strong success so far with the One Plan securing 11,000 new customers in the 7 weeks post launch. Slide 32, changing gears a bit. With 1 year left to go in the 3-year double down strategy, we are tracking well and remain confident of reaching our ambitions by the end of FY '26. Revenue and underlying EBITDA targets are on track. We delivered a positive NPAT A in FY '24 and now a positive NPAT in FY '25. M&A is still a feature of our business. And as noted earlier, we have significant capacity to support these activities. Slide 33. FY '26, will see us focused on delivering the final targets of the DoubleDown strategy and driving more growth from our platform. Superloop is poised to capture the nbn speed to sale opportunity with our high-speed plans. We will accelerate business growth with smart communities moving into the delivery phase. And Superloop remains laser-focused on maintaining our position as a cost leader, driving further operating leverage. We seek to identify and execute M&A opportunities that have strong strategic alignment to our business and leverage our platform and balance sheet. As mentioned, FY '26 is off to a great start with 17,000 net new consumer customers added in the 7 weeks to 18th of August. And we're proud of how we continue to deliver profitable growth in the business achieved through both operational and strategic focus and are strongly positioned to create long-term value for our shareholders. I'd like to thank the team at Superloop for their hard year -- hard work, sorry, in what has been a great year. And with that, I conclude my formal remarks, and I welcome questions.

[Operator Instructions] The first question comes from the line of Nick Harris with Morgans.

Good morning, Paul, in place for the call with great results. A couple of questions from me. Just trying to understand the consumer growth at the start of FY '26. So if you -- on comparing apples and oranges a little bit, but if you look at it sort of on a monthly basis, versus 12 months ago, it looks like the net -- or the growth is substantially stronger than it was 12 months ago on a monthly basis. So I just wanted to double check on looking at that right. And then secondly, maybe just to unpack the Exetel stuff a little bit because obviously, that new 1 brand or 1 product to suit them all sort of thing. It looks like it's resonated really strongly. You talked about adding 11,000 subs since launch. Did it launch at the start of in FY '26, so it's 11 of your 17 adds -- 17,000 ads? Does that make sense?

Yes. So I'll ask Dean to clarify any numbers I get wrong here. But yes, the thematic is correct. So we've certainly started FY '26 a lot more -- with a lot more momentum than we did in the start of FY '25. Now obviously, we are setting ourselves up to take advantage of the expansion of the high-speed plan market this year and the Exetel 1 plan is very much about that. It's front running the changes in September from -- so yes, it's really hit the market well. It's a particular product for -- that really just appeals to those high-speed users, which we see as an attractive part of the market. It's a plan that's very much focused on simplicity. So it's only available on the high-speed technologies, HFC and FTTP as an example. It's a plan that's all about removing the friction from the process. So no promo periods, it's the simplicity that we feel is really appealing. It's a great customer experience, great customer journey. I'd encourage you to drink. But was there something, Dean, about the number you want to bring up?

No, to clarify, the 17,000 is net new consumer customers until the 18th of August. The 11 sales and Exatel, new customers, that is between the first of July and the 18th of August, and just to confirm, that excludes any migrations or transfers between the Superloop and the legacy Exetel brand. That's 11,000 new customers, new customers to the Superloop Group in that period of time, which is a little bit over 6 weeks, 6.5 weeks.

Thank you. Clearly, it's doing really well. And probably just 1 more and then I'll jump out of the back of the queue. Just the cash flow conversion was really strong, which is great to see. Balance sheet looks great. I note you've still got M&A on your acquisitions on your FY '26 plans. I don't know if you're in a position to maybe give us any details as to what sort of stuff we might be able to look for? Or is that too hard to talk about.

Well, I'm going to give you the same answer I've given you previously for it. So we did see M&A as a key part of the DoubleDown plan. In fact, we said that half of the target would be met through M&A and half organically. Now clearly, our organic business is running well ahead of expectations. And we bought very little -- we bought Uecomm, but not much else during the double-down period. That's not because we aren't actively exploring M&A opportunities. We are. We're always in discussions, and we are in discussions right now. But that doesn't tell you very much. As I said, we're always in discussions. We didn't find any opportunities during the first 2 years that we -- apart from Uecomm, which we felt were meeting all of our criteria. We have very strict criteria, and we are disciplined about M&A. So we have plenty of firepower to undertake M&A. I think we're pretty good at it. But we want to do good M&A when opportunities come up. And clearly, the organic part of the business is exceeding expectations. So the need to do it is M&A is not a strategy. It's a way of delivering a strategy.

Next question comes from the of Cameron Bell with Canaccord Genuity.

Okay. Paul, just wondering how much in us future are you expecting around September, October.

Look, we -- clearly, the way we've set ourselves up getting the Superloop brand into a nice clean position by bringing the price changes very early in the year this time setting up the Exetel 1 plan, we're clearly setting ourselves up for a fairly material churn event or disruption, let's say, come September. It is a significant change in the nbn propositions that are available in market. And when there's a significant change, be that a price shock, CPI indexation, new product categories, whatever it might be, that's where we do well. So I do think that the introduction of those -- of that speed test or the accelerated rate campaign as NBN pulls it will drive industry activity, so an increased level of industry churn and we want to be really taking advantage of that as we generally do during those periods of disruption.

Okay. And -- on the OpEx side, that was a highlight as we say. Do you really ramp up your marketing spend given the opportunity with, I guess, Exetel T1 and arranges.

Yes. Look, in the first half of this financial year, we will increase our marketing spend. The performance of the Exetel 1 plan has been exceptionally good in the first 6 weeks. The cost to acquire is really impressive. So if it keeps going on this, yes, we'll increase our marketing investment, provided the cost to acquire is maintained. And as I said, we're seeing really good momentum on that brand. And we're hopeful as we move into the Superloop event that we can really take some further share through that window of market disruption.

Sure. And then just the last one for me. Just how you think about CapEx given recent investments.

Yes. Look, we're really pleased with the discipline we've shown around the CapEx, the trend down in terms of CapEx to revenue is really, really good. We don't see any really sort of significant increases in CapEx coming from the sort of the core network components. We're well placed there. We've invested in network quality, and we have substantial volumes to enable growth. The drivers of CapEx moving forward are essentially associated with continuing success on smart communities. So smart communities continue to go forward, then and expand, there'll be some sort of moderate increases in CapEx as we go forward, but that's a success-based CapEx. So yes, I don't see a step change in CapEx coming. We've made the big investments a number of years back to connect to the NBN poise. We've got a high-quality sort of asset base and the eCom acquisition has helped us as well.

Next question comes from the line of James Wilson Macquarie.

A few from me. To start -- do you see any risk to the customer growth strategy that you guys have heading into the churn event given that I mean, not all of your competitors have raised prices completely in lockstep with you. I understand you've called out that maybe the churn of existing customers have sort of ended. But what about growing incrementally? Do you see any risk to your strategy on price?

Look, there's always risk. And I'd call out the structure of business is not just about consumer. So Part of our strategy is to enable all of the challenger brands, a core of our strategy is to enable all the challenger brands, and we see ourselves as a wholesaler first. So we have a whole pile of brands that we support through the wholesale platform, not just Origin, although, of course, that's the largest. So the combination of brands that we are supporting. It gives us great exposure to high levels -- to the inevitable high level of churn that will come through that event. I think your question was more about our consumer brands specifically. We guide our consumer business more around cash. So we want to make sure that the customer base we acquire is optimized. We keep -- in the sense that our cost to acquire is kept under control. We balance our marketing investment against competitive intensity. So we would prefer to give up volumes rather than give us value and maintain a portfolio across the whole of the business that continues to grow comfortably in the long term. But there's always risk that the consumer market could get more competitive than we plan, although clearly, we're driving competition, and we think we're really well set up to take advantage of it. But we are exposed broadly to the market as well to benefit from the change.

Great. And maybe if we just move to the business segment. Can you just talk us through maybe your expectations around the NBN market and the discounting that you've seen historically there? And also maybe if you can give us an idea around the timing of when we might see an uplift from the Smart Communities business actually contributing materially into growth in that segment?

I'll try the business question first. And Dean, maybe if you think about the smart Communities question. So look, the sector, the whole of the business market has being -- or the fiber-based business market has been materially impacted by the introduction of the nbn. No one can shy away from that. So private fiber services have been put under pressure by the fact that the nbn services deliver well. And so there has been a significant step down from traditional private pipe networks, MPLS networks onto NBN's more TCF-based services or even their enterprise Ethernet products at a lower price. So that sort of price erosion is not a Superloop issue. It's a market issue, but it's been an issue for some years. Typically, businesses can tract on around about a 3-year -- sort of 2- to 3-year contract, and most of the market has been going through that for several years now. So we really do see that the tail -- we are now facing the tail ends of that kind of structural change in the market. Our volumes have held up well. So we've been taking share in the market. And you can see that our revenues have stayed pretty flat. They stayed flat in decline, let's say, of the significant price erosion that we had to deal with. So volumes have outweighed revenue loss through price erosion there. With that momentum that we have in volumes, we obviously hope to return the business or expect to return the business segment back to growth during this financial year.

Okay. Just on the smart communities, we've actually provided some more information this year. There is some sort of more clearly around the time lines to build. If you look there at the moment, we have 42,000 lots that are in various stages of construction. We anticipate around 35,000 of those will be delivered within 5 years. The smart communities this year has been a stellar result, not only the volume of new contracts that we signed that are so important as well. I think it's great recognition that we were successful in winning Bradfield, that's a contract with the New South Wales government for 10,000 lots, building a complete new city. So I think that has been very much a recognition of our capabilities, our presence in the market, certainly opened up a lot more opportunities for us moving forward. So you can essentially take 35,000 and see that as being delivered within the next 5 years, but we're incredibly proud of what we've achieved in the last 12 months, and I think it sets us up for a lot of growth moving forward in smartness.

Just 1 quick final 1 for me. You give us just an idea on the active current Smart Communities number, maybe what the revenue or the earnings contribution is from that business currently?

I don't think we've broken that out specifically. Let's take that as an action and we'll think about how we can represent that Thanks.

Next question comes from the line of Benjamin Jones with JPMorgan.

Just on that wholesale business, were you able to quantify the revenue or EBITDA impact of that Symbio customer loss. And when in the period did that happen and how do we think about that annualized impact?

Look, it happened in the second half -- for the latter part of the second half. I think the gross margin contribution from the symbio, we've said many times is under $2 million. It's not that material to the business. Got it. That makes sense.

And obviously, Exetel, those early subs have been very strong. I mean what does that Exetel brand mean for your fuel gross margin target from the.

So it is dilutive in the sense that we've positioned Superloop a higher price than Exetel, and, of course, on simple math. -- that suggested that it's at a lower gross margin. We run our consumer business at a portfolio level. So we have a portfolio gross margin with some plans on higher margins, some on lower, and it's different across the different brands. And we haven't changed our gross margin target for the segment. We -- so it's a mixed question. we're very comfortable that the Exetel product is a sensible product for us. We expect a lower churn profile on the Exetel product. And one of the primary drivers of that is no promo period. So there is a a drug that the industry is on, which is the 6-month promotion period and lots of bargain seekers migrate out at the end of the promotion period to a different provider who is providing a promotion period there. So we think the removal of promotion periods on this brand and the -- just the excellence of the experience. I'd encourage you to try it. The customer journey is so elegant. We think that we will see a very different churn profile on that customer. And at a cash level, they will be as valuable customers to Superloop as a Superloop branded customer in the -- on a life cycle basis. So I think the answer to your actual question is no change in our segment gross margin aspirations, but a slightly different portfolio mix.

Yes. And Paul, I can make a comment on that one. As a consequence of the way we're delivering that product is a step reduction in our cost to serve, which is really impressive. And we believe that we'll see a longer customer lifetime value because we're not attracting those that are switching sort of based on promo discounts. So the service metrics around this product are exceptional. And we're really delighted with how the AI is working and second sort of addition of our AI bot. And we were seeing 86% of all sort of share handled by the [indiscernible], which I think is an incredible result. So the cost savings and delivery model on this line of grade. And obviously, we'll take the benefits and efficiency around this back into our Superloop brand over time as well.

Yes. Fantastic. -- that makes sense. And then just on the trading and providers in that consumer business of 17,000 stores in the first 7 weeks. I mean I get to sort of 2,500 subs a week on a basis now that you have that dual branch superiority in market, knowing you have put a bit more marketing spend if you do hold that marketing spend from here. Is that weekly rate of addition as sustainable through the year?

No. Look, we'll be realistic. So the product is front running the nbn change that is available to the market in September. So we took a deliberate decision to launch early and shape the product to deliver it accordingly. So we have benefited from being early and getting the mind share and it will definitely get more competitive when many other brands do as we expect they will do from September and launch their own versions of the Accelerate grade program. We think we're very well positioned. And as I said, during these periods of high churn, given our acquisition share in the market is substantially higher than our market share, that will be positive for Superloop, but I think it will be unrealistic to expect that the starting run rate. could be just annualized out and as a full year aspiration.

The next question comes from the line of Annie Zhu with Barrenjoey.

My first question is on the consumer business. So there's been some concern around the sub slowing in the second half of FY '25, but you still met your gross profit and EBITDA expectation. So that means that the gross profit per state is actually far than what everyone thought. So now that growth is taking ahead of work consensus things in FY '26. Is it possible that there hasn't been a change in your thinking around FY '26 consumer revenues the sub endpoint, is it materially different but the profit per sub is higher?

Yes. Look, we decided to make those changes, as Paul indicated, in May and June to set our sales up for FY '26. And it was a decision made to enable us to put the prices through to our -- both our Superloop and our Exetel base, and we're really proud now in terms of what we're achieving so far in the first 6 or 7 weeks. So we very much believe we made the right decisions as evidenced through the results we're achieving. And yes, broadly in line with what you're saying, we did put some price increases through, which will certainly help us as we move into FY '26 on our base. And we're really happy with the volumes we're seeing coming through on consumer today.

And just on your double down targets. I just noticed that the 500,000 consumer customer target was mentioned. So just wondering if you're stepping away from this market.