Daniel Perlin

Dan Perlin inquired about the derivative benefits of the 'Big Nothing' event, focusing on Affirm Card sign-ups, the uplift in credit quality, and how these learnings can be applied to everyday shopping to boost GMV.

Answer

Max Levchin, Founder and CEO of Affirm Holdings, highlighted the significant GMV and conversion boost from the 'Big Nothing' event, noting it skewed towards higher credit quality users. He emphasized that 0% APR loans do not preclude consumers from using interest-bearing products, and that the event led to outsized cardholder growth, providing valuable insights for future promotions.

Dan Perlin asked about the derivative benefits of 'the big nothing' event, focusing on credit quality uplift and applying learnings to everyday shopping.

Answer

Max Levchin, Founder and CEO, noted 'the big nothing' skewed towards higher credit quality due to 0% APR self-selection, with cardholder growth outpacing GMV gains. He clarified that 0% first loans do not preclude consumers from taking interest-bearing loans, as Affirm consumers cross-pollinate across product types.

Dan Perlin asked if Affirm's healthy consumer spending and low delinquency trends reflect the overall health of less affluent consumers or are primarily a result of Affirm's underwriting technology.

Answer

Max Levchin attributed the strong performance to Affirm's 'highly unnatural' and carefully constructed mathematical underwriting. He noted that while Affirm's sample is small, it indicates healthy consumer behavior, even detecting minor demand slowdowns among government employees during a shutdown without impacting repayments.

Dan Perlin asked if Affirm's data, showing a healthy consumer spending environment and low 30-day delinquencies, reflects the overall health of the less affluent consumer or is primarily a function of Affirm's underwriting technology.

Answer

Max Levchin, Founder and CEO, clarified that Affirm's underwriting is 'highly unnatural' and carefully constructed. While acknowledging Affirm's data is a statistically significant but small sample, he noted that their consumers are borrowing and repaying healthily. He cited an example of government employees showing no loss of repayment during a shutdown, indicating current stability.

Dan Perlin of RBC Capital Markets asked about the repeat purchase behavior of new users acquired through 0% APR offers, questioning if they convert to using other Affirm products.

Answer

Founder & CEO Max Levchin confirmed that users acquired via 0% APR offers exhibit strong repeat behavior. He emphasized that, importantly, these users also convert to using interest-bearing loans, which are more profitable for the company, demonstrating the positive overall experience.

Dan Perlin from RBC Capital Markets asked about the organic growth trajectory of the wealth and investment management business, particularly its potential medium-term growth rate. He also inquired about the current M&A environment, specifically regarding asking prices and the availability of potential acquisition targets.

Answer

Chairman and CEO Bill Stone expressed strong optimism for the wealth management business, highlighting the Black Diamond platform as 'best in the industry' with significant AUA and successful client migrations, calling it a 'crown jewel.' Regarding M&A, Stone noted SS&C's long history and current leverage position allowing for large, accretive acquisitions, emphasizing SS&C's strong operational and financial position to pursue opportunities.

Dan Perlin inquired about the Q4 organic revenue growth guidance of 4.5%, specifically asking for the contribution of Battea to this figure, and sought details on the mechanics behind the successful organic quarter, particularly regarding recent liftouts.

Answer

CFO Brian Schell clarified that Q4 2024 was a strong comparative quarter and projected Battea's Q4 2025 contribution at approximately $25 million, up from $16 million in Q4 2024. Chairman and CEO Bill Stone attributed the strong organic growth to a significant liftout completed in Sydney, Australia, on July 1, and other large liftouts, expressing confidence for Q4 and 2026.

Dan Perlin inquired about the Q4 organic growth guidance of 4.5%, specifically asking for the contribution of Pathea to this figure and whether the guidance was conservative. He also sought more details on the mechanics behind the successful organic quarter, particularly regarding liftouts.

Answer

Brian Schell, Chief Financial Officer, explained that Q4 of the prior year was SS&C's strongest quarter, and the 4.5% guidance is a reasonable starting point. He specified Pathea's expected contribution for Q4 2025 at $25 million, up from $16 million in Q4 2024. Bill Stone, Chairman and Chief Executive Officer, attributed the strong organic growth to a significant liftout completed in Sydney, Australia, on July 1, and other large liftouts, expressing confidence for Q4 and 2026.

Dan Perlin asked about the growth rate of the TATAYA business and questioned if the recent acquisitions of higher-growth assets like Callistone and TATAYA signal a strategic shift in M&A.

Answer

EVP & CFO Brian Schell confirmed TATAYA is growing at a low double-digit rate, with expected seasonal strength in the second half. Chairman and CEO William Stone affirmed a strategic focus on acquiring high-quality, higher-growth businesses, acknowledging the market's preference for strong organic revenue growth.

Daniel Perlin of RBC Capital Markets questioned the high-level demand environment, asking about client conversations and the risk of a pause in decision-making. He also sought to understand the potential ramp and cadence of the opportunity in Australia following the Insignia deal and other new mandates.

Answer

Bill Stone (Executive) responded that significant technological shifts, particularly in AI, are driving change in wealth and asset management, positioning SS&C to help clients navigate this complexity. Regarding Australia, Stone expressed strong optimism, describing the superannuation market as a "wall of money." He believes SS&C's at-scale technology and talent are being embraced in a market where local service providers may have lagged, creating a great growth opportunity.

Daniel Perlin of RBC Capital Markets asked for insight into the building blocks for the 5% midpoint organic growth guidance for 2025, given recent investments. He also requested more detail on the superannuation market opportunity in Australia following the Insignia lift-out agreement.

Answer

CEO Bill Stone explained that growth is driven by the ramp-up of large-scale services clients over several quarters and by significantly increased investment in sales and marketing, which has grown from ~$250 million to ~$600 million annually. Regarding Australia, Stone described the superannuation market as a 'brilliant national program' where SS&C believes it has superior technology and a strong team, creating significant opportunity for growth and increased market share.

Daniel Perlin sought more detail on the 400-basis-point deceleration in the Q4 organic growth forecast, asking which segments were most affected and if license revenue pulled into Q3 was a factor. He also asked about the future potential for cost savings from Blue Prism automation.

Answer

President and COO Rahul Kanwar clarified the Q4 forecast is mainly a comp issue, as Q4 2023 revenue was about $50 million higher than other quarters in that year. Chairman and CEO Bill Stone added that strong Q3 license revenue in WIT and GIDS contributed to the tough comparison. Regarding Blue Prism, Bill Stone expressed enthusiasm for further deployment and cost savings, particularly in finance, and noted the integration of AI is enhancing its capabilities. CFO Brian Schell added that the company's sophistication in using digital workers continues to mature.

Dan Perlin inquired about the sustainability of Lightspeed's strong software gross margins, especially given the impact of lapping prior pricing actions and future investment plans.

Answer

CFO Asha Bakshani attributed the strong software gross margins to OpEx optimization, more efficient cloud spend with Google and AWS, and increased efficiency in the support department through AI deployment. She expressed confidence that software margins above 80% are sustainable for Lightspeed.

Dan Perlin inquired about the overall health of Lightspeed's end markets, seeking detailed insights into regional performance and any unexpected positive or negative trends, particularly concerning same-store sales growth. He also asked about the sustainability of Lightspeed's strong software gross margins, considering the impact of lapping prior pricing actions and ongoing investments.

Answer

CFO Asha Bakshani confirmed healthy same-store sales in Q3 across all regions, noting strong performance in retail verticals during the holiday period and a slight deceleration in seasonal verticals like home and garden. She mentioned a minor positive impact from FX in European hospitality. Regarding software gross margins, Ms. Bakshani attributed the strength to OpEx optimization, efficient cloud spend, and AI deployment in support, expressing confidence in sustaining over 80% margins.

Daniel Perlin from RBC Capital Markets inquired about the drivers of the 9% subscription revenue growth, specifically the contribution from last year's pricing initiatives versus new location growth. He also asked for the expected timeline to reach the 10-15% customer location growth target.

Answer

Founder and CEO Dax Dasilva acknowledged that prior pricing actions contributed to the 9% software growth but emphasized that momentum is building from new customer additions and product adoption. He clarified that the 10-15% location growth is a three-year compound annual growth rate (CAGR) target for fiscal 2028, noting that the company is on a strong trajectory with 130 of 150 planned outbound sales reps already hired and ramping up.

Daniel Perlin inquired about the rationale for abandoning the company sale process, whether the go-forward strategy is merely a continuation of the existing transformation, and the expected timeline for the restructured go-to-market team to become productive in fiscal 2026.

Answer

Founder and CEO Dax Dasilva explained that the strategic review concluded that remaining a public company was the best path to maximize shareholder value. He clarified the transformation plan is now more developed, focusing on reallocating resources from 'efficiency' markets to growth engines. CFO Asha Bakshani added that while detailed fiscal 2026 guidance is forthcoming, new sales reps typically take six months to ramp up, and the company expects meaningful EBITDA expansion and accelerated location growth next year.

Daniel Perlin asked for the rationale behind keeping account managers focused on payments through Q2 and for details on the upcoming pricing strategy.

Answer

President JD Saint-Martin explained that the sales team's focus is part of a two-half strategy for the fiscal year, with a pivot back to software upselling expected to drive growth above 10% in the second half. He confirmed the new pricing applies to both new and existing customers, with the financial impact anticipated from Q3 onwards.

Dan Perlin asked about the opportunities surrounding value-added services, specifically purpose-built offerings for major events like the Olympics and World Cup, given their increased significance to Visa's business today.

Answer

Ryan McInerney, Visa's Chief Executive Officer, explained that marquee sponsorships like FIFA and the Winter Olympics allow Visa to pass rights to clients globally, designing bespoke programs that generate revenue and deepen partnerships. He noted high client demand for advertising campaigns, sweepstakes, and client events, leading to more renewals and business.

Dan Perlin with RBC Capital Markets inquired about the opportunities within Visa's value-added services, specifically focusing on purpose-built offerings for major events like the Olympics and World Cup, given the increased significance of VAS in the current business landscape.

Answer

Chris Suh, Visa's Chief Financial Officer, and Ryan McInerney, Visa's Chief Executive Officer, explained that these marquee sponsorships allow Visa to pass rights to clients globally, enabling bespoke programs for business growth. These programs range from advertising campaigns and sweepstakes to client events, deepening partnerships and generating revenue.

Daniel Perlin from RBC Capital Markets inquired whether the current geopolitical backdrop is influencing Visa's near-term investment strategy, risk appetite, or M&A opportunities.

Answer

CEO Ryan McInerney acknowledged the increased uncertainty but stressed that spending data remains resilient. Consequently, Visa is staying committed to its current investment and product roadmaps. He added that the company is prepared to adjust if facts change and noted that the current environment could create more M&A opportunities for Visa from its position of strength.

Daniel Perlin asked about the impact of the strong U.S. dollar on purchasing power, cross-border travel patterns for U.S. outbound versus inbound travelers, and overall spending behavior.

Answer

Ryan McInerney, Chief Executive Officer, acknowledged that a stronger dollar historically encourages U.S. outbound travel and makes inbound travel more expensive. However, he noted that overall travel spending typically remains consistent, with travelers just reallocating destinations. He cautioned that it is still too early in the current strong-dollar period to observe definitive shifts in travel patterns.

Dan Perlin from RBC Capital Markets asked about the aggregate demand environment and implementation cycles, seeking to reconcile strong core sales with previous commentary on project delays. He also inquired about the rationale for the wider fiscal 2026 revenue guidance range.

Answer

President & CEO Greg Adelson confirmed that the gap from previous project delays has significantly improved, particularly on the consulting side, and that sales demand remains strong. CFO & Treasurer Mimi Carsley explained the wider guidance range provides more operational flexibility due to the company's larger revenue base and macroeconomic variables, rather than indicating any structural business change.

Daniel Perlin asked if project delays are affecting modernized projects and cloud migrations or are confined to non-recurring items, and also requested context on the potential M&A impact on non-GAAP revenue in fiscal 2026.

Answer

CEO Greg Adelson clarified that delays are almost entirely in non-recurring, 'day 2' complementary and payment products, not core cloud migrations. He noted some customers delay hardware purchases while evaluating a move to the private cloud. CFO Mimi Carsley explained that while M&A has a minimal impact in fiscal 2025, the acceleration in client mergers could have a more meaningful, though not lumpy, impact in fiscal 2026.

Dan Perlin of RBC Capital Markets inquired about the current demand environment for NCR Voyix's retail and restaurant segments and asked for details on the drivers of the second-half ramp in free cash flow guidance.

Answer

CEO James Kelly, along with Retail President Darren Wilson and Restaurants President Benny Tadele, confirmed they have not seen a customer pullback and that market pressures are driving technology investment. CFO Brian Webb-Walsh explained that the second-half free cash flow ramp is driven by typical seasonality and the realization of cost-saving initiatives, noting that CapEx is expected to be slightly higher than previously guided.

Daniel Perlin asked for details on the WorldPay payments partnership, including the launch timeline, the nature of client conversations, and the context for the new retail payment sites KPI. He also questioned the strategic rationale for having two executives based outside the U.S.

Answer

CEO James Kelly explained that the WorldPay integration is on track for a summer launch and that customer feedback has been positive, focusing on the value of a single, simplified relationship. He clarified that they are now reporting retail payment sites that were previously embedded in other metrics. Regarding international executives, Kelly stated that having leaders like Nick East and Darren Wilson abroad provides a broader global perspective and brings them closer to their international customer base, rather than being a response to a specific weakness.

Daniel Perlin asked CEO Jim Kelly about his key strategic priorities to accelerate growth and for clarification on the historical revenue model for enterprise payments before the new Worldpay deal.

Answer

CEO James Kelly outlined his priorities as accelerating the payments and software alignment via the Worldpay partnership, focusing on new customer acquisition, and ensuring execution on product delivery. He clarified that NCR Voyix previously owned the payments platform outright (JetPay) and did not use a revenue share model. The new agreement is a fee-for-service deal for authorization with Worldpay.

Dan Perlin asked for clarification on potential additional divestitures in light of the Worldpay acquisition and inquired about any portfolio attrition or friction resulting from the Genius brand consolidation.

Answer

CEO Cameron Bready stated that while he could not provide specifics, the company is re-evaluating its portfolio composition following the Worldpay announcement, with any proceeds from future divestitures intended for shareholder returns. Regarding Genius, Bready noted a brief pause in new sales ahead of the launch but has not seen significant base attrition, with strong new sales momentum since. President & COO Robert Cortopassi added that the largest driver of attrition is business failure, not product defection, and highlighted the greenfield opportunity for Genius internationally.

Dan Perlin asked for clarification on potential additional divestitures following the Worldpay acquisition and questioned if the Genius platform consolidation was causing any customer attrition or friction.

Answer

CEO Cameron Bready stated that while the company is re-evaluating its portfolio in light of the Worldpay deal, he could not specify future divestitures. Regarding the Genius launch, Bready acknowledged a brief pause in new sales ahead of the rollout but reported no significant attrition from the existing customer base and highlighted strong new sales momentum post-launch. President & COO Robert Cortopassi added that the primary attrition driver is business failure, not product defection, and noted Genius is targeting greenfield international markets.

Daniel Perlin of RBC Capital Markets requested more specific detail on the 2025 revenue growth cadence between the first and second halves of the year. He also asked about management's level of conviction and visibility into its forecast amidst the significant organizational transformation.

Answer

CEO Cameron Bready and CFO Joshua Whipple clarified that while the second half will see a slight acceleration, both halves are expected to be within the 5-6% growth range, not below it. Bready expressed high confidence in the outlook, stating that visibility is arguably better now than at the Investor Day, given the early positive results of the transformation and the team's proven ability to manage the changes.

Daniel Perlin sought clarification on whether the 5% revenue growth target for 2025 is based on a pro forma 2024 number excluding divestitures. He also questioned the confidence in the Q4 exit rate, given potential disruption from the company's transformation.

Answer

CEO Cameron Bready clarified that the 5% growth target for 2025 is an organic figure. Regarding Q4, Bready expressed confidence, noting that October trends were better than September, partly due to the absence of hurricane impacts. He expects merchant performance to be stable to slightly better and the Issuer segment to benefit from recent conversions.

Dan Perlin asked for an expansion on the structural changes in global education, particularly the growing demand in non-Big Four markets, and questioned the potential for margin contraction in Q4 based on guidance.

Answer

President & COO Rob Orgel explained that Flywire's long-standing international presence and tailored value proposition are driving strong client reception and traction in expanding education markets across Europe, APAC, and Latin America. CFO Cosmin Pitigoi clarified that the implied Q4 margin is roughly flat at the midpoint of guidance and reiterated the company's commitment to growing OpEx at a lower rate than gross profit over the long term.

Daniel Perlin asked about the addressability of the 'next 20' non-traditional education markets and inquired about the size and conversion timeline of the implementation backlog for the travel vertical.

Answer

President and COO Rob Orgel clarified that the 'next 20' education markets are ones Flywire already serves, with the growth opportunity coming from deeper penetration. Regarding travel, he explained that implementation is very fast, typically measured in weeks, meaning the conversion from signing to revenue is quick.

Dan Perlin asked for clarification on Global Blue's second-half revenue contribution and its organic growth profile, and also inquired about the planned order of operations for realizing revenue synergies from the acquisition.

Answer

CEO Taylor Lauber clarified that Global Blue's contribution is consistent with its prior standalone guidance of mid-teens growth and that no material synergies are baked into 2025. He outlined a two-pronged synergy plan: first, integrating the currency conversion product into Shift4's existing network, followed by a more complex, longer-term payments cross-sell to Global Blue's merchant base starting in mid-2026.

Daniel Perlin of RBC Capital Markets asked about the integration plans for Revel and Vectron, early learnings from POS rollouts in Europe, and how these efforts reconcile with the previously mentioned slowdown in Canadian and European card-present merchant onboarding.

Answer

CEO Jared Isaacman explained that the company's conversion playbook is proceeding as planned but acknowledged a timing mismatch between pivoting the acquired companies' models and ramping up new volume. He attributed the slower-than-expected international rollout to specific, temporary hurdles like debit card certifications in Canada and Germany, which are now being resolved. He expressed high confidence in converting the 65,000 Vectron merchants in Europe going forward.

Daniel Perlin inquired about the integration plans for Revel and Vectron, seeking insights on early learnings from European POS rollouts versus the U.S., and how this reconciles with the noted slowdown in Canadian and European card-present merchant onboarding.

Answer

CEO Jared Isaacman explained that while their conversion playbook is effective, the timing of onboarding thousands of merchants can be uneven. He attributed the slower-than-expected international rollout to minor but critical delays, such as specific debit card certifications in Canada and Germany. Isaacman confirmed these issues are now resolved and the ramp-up is proceeding, expressing confidence in converting the 65,000-merchant Vectron base.

Daniel Perlin of RBC Capital Markets asked for an update on the bank M&A environment and Q2's confidence in being a beneficiary, and sought clarification on whether the proliferation of point solutions for fraud is a competitive headwind or a benefit.

Answer

CEO Matt Flake stated his confidence stems from a historical 90-95% win rate when its customers are involved in M&A, with a 94% rate year-to-date. He clarified that many new fraud vendors are partnering with Q2 through Innovation Studio, making it a cross-sell opportunity rather than a competitive threat.

Daniel Perlin asked if Q2 is observing client nervousness and spending pauses due to the macro environment, and inquired if the strong Q1 free cash flow represents a new trend or a one-time event.

Answer

CEO Matt Flake and President Kirk Coleman confirmed that while clients discuss macro uncertainty, it has not impacted deal pipelines or changed their strategic priorities. CFO Jonathan Price explained that the exceptional Q1 free cash flow was partly due to a one-time large customer payment change, and the full-year outlook remains consistent.

Daniel Perlin from RBC Capital Markets asked about the significant sequential increase in backlog, questioning whether it was driven by larger average deal sizes or a broader increase in customer spending appetite.

Answer

CFO Jonathan Price clarified that the magnitude of the sequential backlog increase was primarily driven by the seasonal strength of renewals in the fourth quarter. He explained that because renewals involve large, long-term contracts, they have the most significant impact on the backlog in any given period, more so than changes in new deal sizes alone.

Daniel Perlin asked for more detail on the evolution of recent deals, noting they appear larger and more holistic, and inquired about implementation capacity given the significant backlog growth.

Answer

CEO Matthew Flake confirmed strong demand driven by banks' need for deposits and sophisticated relationship pricing. He highlighted a large expansion opportunity within existing customers and noted that sales, finance, and implementation teams work closely on capacity planning, stating he does not anticipate any issues in 2025.

Daniel Perlin asked for more detail on the demand environment, specifically the potential for a pause in client investments, and for clarification on the difference between high equity position growth and the resulting revenue growth.

Answer

CEO Timothy Gokey acknowledged a recent "elongation in our closing process" due to market uncertainty but stressed that client demand remains strong, particularly for cost-saving and simplification projects. He noted this is a timing issue, not a loss of deals, and won't impact FY26 revenue due to the existing backlog. Regarding position growth, Gokey explained that the rise of direct indexing is creating many small, non-revenue-generating positions. While this dilutes near-term revenue growth from the headline position growth number, it builds a strong backlog of future revenue-generating accounts.

Daniel Perlin sought clarification on the volatility of GTO license revenue, which was a headwind in Q2 but is expected to boost Q3 growth. He also asked about the potential impacts of a more active M&A environment and the new administration's regulatory agenda.

Answer

CFO Ashima Ghei clarified that while license revenues are a small part of annual GTO revenue, they can cause quarterly fluctuations, explaining the specific timing impact between Q2 and Q3. CEO Tim Gokey stated that a pickup in M&A is not a material driver for Broadridge. Regarding regulation, he noted that while the environment is broadly deregulatory, the administration's core priorities are neutral to Broadridge, but there are potential opportunities in areas like digital assets and proxy reform.

Daniel Perlin asked for a reconciliation of Broadridge's guidance, questioning why EPS guidance was not raised alongside the recurring revenue forecast, and also inquired about the company's M&A appetite and market environment.

Answer

Interim CFO Ashima Ghei explained that higher-margin event activity provides capacity for reinvestment to support the 8-12% EPS growth target. CEO Tim Gokey added that the recently acquired SIS business, which drove the revenue guidance increase, is expected to be neutral to EPS in its first year. Regarding M&A, Gokey stated that while the pipeline is strong, Broadridge remains disciplined on financial criteria and strategic fit, and is comfortable with share repurchases if compelling deals do not materialize.

Daniel Perlin asked about cross-border dynamics, specifically how a weaker U.S. dollar might affect consumer behavior and for a breakdown of discretionary versus non-discretionary spending within cross-border transactions.

Answer

CFO and COO Jamie Miller emphasized PayPal's diversification as a strength. She noted that U.S. TPV is now split 50/50 between goods and services, and cross-border TPV is also highly diversified, with significant intra-European corridors. She stated it is difficult to predict the precise impact of currency shifts, which is why the company's guidance remains prudent.

Daniel Perlin questioned the rapid deterioration in business outside of the top three clients and the apparent lack of visibility into these volume changes.

Answer

President and CEO Jeffrey Puritt acknowledged the frustration with short-notice volume declines. He attributed this to client agreements that provide them with flexibility and the current macroeconomic pressure on clients to get 'more for less.' Puritt conceded that the company has not managed these fluctuations as well as it should have and needs to improve its ability to anticipate or offset such declines.