Michael Infante

Michael Infante from Morgan Stanley inquired about the incremental nature of LLM-based referral traffic versus potential cannibalization of existing organic searches, and later asked about the quantifiable drag of persistent organic traffic headwinds on NerdWallet's 2026 profitability outlook, specifically regarding performance marketing intensity as a medium-term margin headwind.

Answer

CEO Tim Chen confirmed that LLM referral traffic appears incremental, showing higher and rapidly growing conversion rates. CFO John Lee clarified that NerdWallet prioritizes increasing non-GAAP operating income (NGOI) dollars over margin percentages, noting that performance marketing revenue is currently offsetting organic revenue declines, and suggested reviewing past performance marketing spend trends for future growth insights.

Michael Infante from Morgan Stanley inquired about the nature of LLM-based referral traffic, specifically whether it is incremental to NerdWallet's business or if it cannibalizes existing organic searches. He also asked about the impact of persistent organic traffic headwinds on the 2026 profitability outlook and if performance marketing intensity represents a medium-term headwind to margins.

Answer

Co-founder and CEO Tim Chen stated that LLM referral traffic is incremental, showing higher conversion rates and rapid growth. CFO John H. Lee clarified that NerdWallet is focused on increasing non-GAAP operating income (NGOI) dollars rather than margin percentage, noting that organic revenue declines have been more than offset by performance marketing revenue. He suggested looking at past performance marketing spend trends for future revenue growth insights.

Michael Infante of Morgan Stanley asked for commentary on registered user engagement trends over the past six months. He also requested an explanation for the rationale behind transitioning to a new insurance platform partner.

Answer

CEO & Chairman of The Board, Tim Chen, explained that the value proposition for registered users remains strong, citing their 5x higher lifetime value (LTV), which increases with the adoption of more features. On the insurance platform, Chen clarified that insurance referrals typically use third-party marketplaces. NerdWallet switched partners to secure better economics and access different features that better suited the company's strategic needs, despite causing a temporary disruption.

Michael Infante inquired about the market impact of TCPA implementation and the reasons for the significant underperformance of the personal loans business in 2024 relative to the market.

Answer

CEO Tim Chen stated that since the TCPA implementation has been stayed, they have not seen a significant impact. Regarding personal loans, he explained the 51% Y/Y decline was due to a strategic lack of internal focus as resources were shifted to insurance, not a poor market. He noted that with renewed focus, they expect a return to Y/Y growth in Q1, highlighting rapid funnel improvements.

Michael Infante asked about NerdWallet's initiatives to mitigate organic search traffic headwinds and for an outlook on the sustainability of its strong growth in the insurance vertical.

Answer

CEO Tim Chen explained that while non-monetizing 'learn' content traffic is pressured by search engine changes, monetizing 'shop' content is rebounding. He highlighted the long-term strategy of building direct user relationships via registrations and vertical integration to counter this volatility. Chen also confirmed he expects insurance strength to persist, driven by both market share gains from product improvements and a 'super cycle' of consumer re-shopping amid structurally higher premiums.

Michael Infante from Morgan Stanley asked for details on the travel outlook, both including and excluding Sertifi, and how Flywire plans to allocate resources to sustain growth in this vertical. He also inquired about demand for stablecoin payments, identifying any key corridors where usage is observed.

Answer

Cosmin Pitigoi, Chief Financial Officer, stated that travel is expected to grow at or above the company average, driven by strong performance in both Sertifi and the legacy luxury travel business. He noted increased investment in growing the travel sales team and global expansion for Sertifi. Mike Massaro, Chief Executive Officer, confirmed that Flywire is live and actively testing demand for stablecoin payments, particularly in volatile currency markets, and is also exploring internal use cases for faster, more cost-effective currency settlement, though current usage is small.

Michael Infante asked for details on Flywire's travel outlook, including growth expectations both with and without Sertifi, and how resources are being allocated to sustain growth in this vertical. He also inquired about demand for stablecoin payments, any key corridors showing usage, and the current level of adoption.

Answer

Cosmin Pitigoi (CFO) stated that travel is expected to grow at or above the company average, driven by strong performance in both Sertifi and the legacy luxury travel business, with investments focused on growing the sales team and Sertifi's global expansion. Mike Massaro (CEO) confirmed that stablecoin is live and actively testing demand in volatile currency markets, currently showing small but promising usage, and is also being explored for internal settlement processes.

Michael Infante asked about recent trends and wallet share opportunities in the UK education business, and also inquired about the target profile for students who might use the new stablecoin payment option.

Answer

President & COO Rob Orgel stated that Flywire is in the very early stages of penetrating the UK market with its SFS platform, which can increase revenue per client by 2-3x, and highlighted a broad product offering. CEO Mike Massaro described the stablecoin partnership as an innovation to provide more payment options, particularly in markets with high currency fluctuation, with a rollout expected in the next six months.

Michael Infante asked about the impact of the mix shift in Buy Now, Pay Later (BNPL) towards flexible credential cards and digital wallets on Marqeta's unit economics. He also inquired about the nature of Marqeta's conversations with larger financial institutions and the areas they are currently diligencing.

Answer

CEO Mike Milotich stated that the mix shift in BNPL has not had a significant impact on Marqeta's unit economics, as they remain relatively similar, with consumer value propositions potentially having a slight premium. He highlighted that the main benefit is increased stickiness, making it harder for customers to diversify. Regarding financial institutions, Milotich noted more frequent and substantive conversations, driven by a market shift towards modernization and competitive threats from fintechs. Marqeta aims to break in with specific use cases like commercial payments and lending/BNPL, leveraging its established leadership and scale.

Michael Infante asked about the impact of the BNPL mix shift towards flexible credential cards and digital wallets on Marqeta's unit economics, and for an update on conversations with larger financial institutions.

Answer

CEO Mike Milotich stated the BNPL mix shift has no significant impact on unit economics, as they are relatively similar. He highlighted the primary benefit as increased stickiness for Marqeta due to consumer-oriented credentials being harder to diversify. He noted more frequent and substantive conversations with financial institutions, expecting to break in with commercial and lending/BNPL use cases.

Michael Infante asked for clarification on whether WEX's guidance for the year incorporates any potential impact from the renewal of a key OTA customer within the corporate payments segment.

Answer

Jagtar Narula (CFO, WEX) confirmed that WEX's guidance for the corporate payments business fully incorporates all considerations, including potential pricing impacts related to such renewals.

Michael Infante asked how WEX is thinking about and positioning for the potential reshaping of OTA workflows and travel payment economics due to agentic travel booking, and where any impact might first appear across volumes, take rates, or channel mix in the medium term.

Answer

Melissa Smith, Chair and CEO, WEX, acknowledged the evolving travel journey but noted that OTAs remain structurally embedded, partnering with AI platforms. She emphasized the increasing importance of virtual card payments due to their unique capabilities like buyer-seller predictions, global acceptance, automated reconciliation, and data wealth, which are becoming more critical despite changes in how processes occur. Jagtar Narula, CFO, WEX, confirmed that the guidance fully incorporates all considerations for the corporate payments business, including potential pricing impacts from OTA customer renewals.

Michael Infante asked for Corpay's high-level perspective on the mechanism for medium-term compression of stablecoin off-ramp costs, given that costs are dictated by liquidity, and the incremental tailwind if customer demand for stablecoins materializes.

Answer

Ron Clarke, Chairman and CEO, stated that Corpay sees no indication of stablecoin off-ramp cost compression, as the rails are an insignificant piece of the cost structure. He believes that current pricing, which can range from 50 to 200 basis points, is primarily driven by liquidity and compliance, not the underlying rail cost. He reiterated that Corpay does not view this as a high risk and will offer stablecoin services if demand arises, comparing the current situation to the EV market where discussion outweighs actual usage.

Michael Infante asked for Corpay's high-level perspective on the mechanism for medium-term compression of stablecoin off-ramp costs, considering if these costs are dictated by liquidity, and the incremental tailwind if customer demand for stablecoins materializes.

Answer

CEO Ronald Clarke stated that current demand for stablecoins is non-existent. He believes off-ramp costs are primarily driven by liquidity and compliance, not just rails, and therefore does not anticipate significant cost compression. He reiterated that Corpay will offer stablecoin services if demand emerges, but currently views it as more hype than actual usage.

Michael Infante inquired about the widening spread between equity position growth and equity revenue position growth, the underlying mechanics, and whether the spread is expected to remain consistent, widen, or compress.

Answer

CEO Tim Gokey explained that the spread is influenced by incremental growth in fractional shares and small-dollar managed accounts, which are additional to the core revenue positions. He focuses on the drivers of core revenue positions, such as single-name growth and healthy managed accounts. CFO Ashima Ghei added that the 11% revenue position growth is still elevated compared to Broadridge's long-term mid-to-high single-digit history, and the additional growth could be considered a 'position backlog' for future conversion.

Michael Infante asked about Broadridge's visibility into its second-half closed sales outlook, specifically inquiring about the proportion of late-stage contracts versus new logos and the overall confidence level in achieving the full-year guidance. He followed up by asking about the widening spread between total equity position growth and equity revenue position growth, seeking insights into its underlying mechanics and future expectations.

Answer

CEO Tim Gokey acknowledged the need to "chop wood" in the second half, given the $89 million year-to-date sales, but expressed confidence due to strong momentum and a more than 20% increase in pipeline origination during the first half. He noted that growth is driven by strategic initiatives like shareholder engagement, digital communications, wealth platforms, and tokenization, citing a recent significant DLR sale to a tier-one global bank as an example. Gokey reaffirmed the full-year closed sales guidance of $290 million-$330 million based on the current pipeline mix. Regarding the spread, CEO Tim Gokey explained that it is influenced by additional growth in fractional shares and small-dollar managed accounts, which are incremental to core revenue positions. He emphasized focusing on the drivers of core revenue positions, such as single-name growth and healthy managed accounts. CFO Ashima Ghei added that the 11% revenue position growth is still elevated compared to Broadridge's long-term history of mid-to-high single-digit growth, viewing the additional growth as potential future conversion.

Michael Infante inquired about the discrepancy between Broadridge's recurring revenue outlook tracking towards the high end of its range and the reaffirmation of its Adjusted EPS guidance, seeking clarification on the factors preventing EPS from also tracking higher, especially given the incremental margin nature of event-driven revenue. He also asked about plans to convert Canton Coin holdings to cash to mitigate GAAP volatility and the potential impact of Canton Coin value changes on GAAP EPS.

Answer

CFO Ashima Ghei explained that the raised recurring revenue guidance is primarily driven by recent acquisitions (iJoin and Signal) and underlying business strength, including sales backlog conversion, position growth, and digital asset revenues. CEO Tim Gokey added that it's early in the year to adjust EPS guidance, emphasizing ongoing strategic investments in tokenization, digital assets, shareholder engagement, digital communications, AI, and platform development. Regarding Canton Coins, Tim Gokey stated that Broadridge, as an operating company, intends to liquidate these holdings over time to reduce GAAP volatility, acknowledging potential for increased value. Ashima Ghei clarified that Canton Coin revenue impact on capital markets is about one point and that the $74 million balance sheet value will be adjusted out of Adjusted EPS due to volatility.

Michael Infante of Morgan Stanley inquired about the rationale behind Broadridge's recurring revenue outlook tracking towards the higher end of the range while adjusted EPS guidance was reiterated, considering the incremental margin nature of event-driven revenue. He also asked about the company's intent to convert Canton Coin holdings to cash to mitigate GAAP volatility and the theoretical impact of a 10% change in Canton Coin value on GAAP EPS.

Answer

CFO Ashima Ghei explained that the revenue upside was primarily driven by iJoin and Signal acquisitions, offsetting additional rate cuts, alongside underlying business strength from sales, position growth, and digital asset revenues. CEO Tim Gokey added that it was early in the year to translate incremental margin into earnings, emphasizing ongoing investments in tokenization, digital assets, shareholder engagement, digital communications, AI, and platforms. Regarding Canton Coins, CEO Tim Gokey stated that Broadridge, as an operating company, intends to liquidate these holdings over time to manage GAAP volatility, acknowledging potential for increased value. CFO Ashima Ghei clarified that digital asset revenues contribute about one point to capital markets growth and that the $74 million coin holdings at quarter-end could see volatility adjusted out of adjusted EPS.

Michael Infante asked for a quantification of the impact from smaller position sizes on regulatory revenue growth and inquired about the progress of transitioning clients from license to subscription models to reduce revenue volatility.

Answer

CFO Ashima Ghei clarified that while total equity position growth was 15%, the more impactful revenue-generating equity position growth was 11%. She added that only 75-80% of regulatory revenue is tied to position growth, with other slower-growing international and regulatory businesses affecting the total. CEO Timothy Gokey explained that the transition from license to SaaS models primarily occurs with acquired companies and takes time. A specific large wealth management license renewal shifted from Q3 to Q4, causing the quarterly volatility. Ghei reiterated that license revenue is less than 5% of GTO revenue for the full year.

Michael Infante asked about nCino's incremental AOI margins, the leverage driven in the business, and whether AI efficiencies provide increased confidence in achieving medium-term free cash flow and operating margin targets faster. He also inquired about the company's visibility into next twelve months (NTM) subscription revenue, considering contractual commitments and backlog conversion, for fiscal Q4 and beyond.

Answer

Greg Orenstein, nCino's Chief Financial Officer, confirmed confidence in hitting the Rule of 40 target, citing opportunities for further efficiency from AI and healthy cost discipline. He also highlighted opportunities in gross margin improvement from platform and professional services. Sean Desmond, nCino's Chief Executive Officer, added that the sales activity and pipeline are strong, with the company feeling a 'halo effect' from its AI innovation.

Michael A. Infante from Morgan Stanley inquired about nCino's impressive incremental AOI margins, asking how the company is driving leverage and if AI efficiencies provide increased confidence in achieving medium-term free cash flow and operating margin targets faster. He also asked about the company's visibility into next twelve months (NTM) subscription revenue, considering contractual commitments and backlog conversion for fiscal Q4 and beyond.

Answer

CFO Greg Orenstein highlighted continued opportunities for efficiency from AI and healthy cost discipline, contributing to Q3 success and future expectations. He also mentioned improvements in gross margin from platform initiatives and professional services. Regarding NTM subscription revenue visibility, Orenstein expressed confidence in sales activity and pipeline, noting increased optimism compared to the previous quarter, driven by resonating AI innovation.

Michael Infante sought more detail on management's confidence in the full-year ACV outlook, asking about the relative contribution from Q2 performance versus pipeline visibility. He also asked for confirmation that Banking Advisor is not expected to contribute revenue this year.

Answer

CFO Greg Orenstein affirmed that confidence in the ACV guidance is based on both strong net bookings in the first half and a robust pipeline for the second half, emphasizing that execution is key. He also confirmed that the FY26 guidance does not assume any revenue from Banking Advisor overages, as the focus remains on adoption.

Michael Infante from Morgan Stanley asked whether the observed acceleration in loan growth at banks is helping to catalyze incremental demand for nCino's solutions. He also sought to clarify if the acquisition of Sandbox Banking was included in the prior quarter's ACV outlook.

Answer

CEO Sean Desmond confirmed that loan growth is a core driver of demand, not just for origination but also for portfolio monitoring solutions like continuous credit monitoring, which is gaining traction. CFO Greg Orenstein clarified that the $4.5 million in net new ACV from Sandbox Banking was indeed included in the initial FY26 guidance provided last quarter.

Michael Infante asked for a breakdown of the Q4 guidance, questioning the drivers of the organic subscription revenue reduction after accounting for the FullCircl acquisition.

Answer

Chief Financial Officer Greg Orenstein explained the Q4 outlook reflects a $2 million increase in mortgage churn due to M&A and continued caution on mortgage volumes, as interest rates have not declined as anticipated. He noted these were the primary factors in the organic guidance adjustment and deferred providing a fiscal 2026 outlook until the next earnings call.

Michael Infante asked if an expected inflection in loan growth next year could be a catalyst for larger transformation deals in the U.S. He also requested a framework for thinking about nCino's mortgage business growth relative to market forecasts, given its recent share gains.

Answer

CEO Pierre Naude acknowledged loan growth as a factor but identified portfolio management automation as the next major driver for large banks. Regarding mortgage growth, CFO Greg Orenstein explained that it's too early to predict if it will align with market forecasts, as they need more data on when customers on the new platform pricing will exceed their contractual minimums and generate upside revenue.

Michael Infante asked for ADP's perspective on the potential use of stablecoins for employee payments, including their intention to support it as a payment rail and the regulatory, compliance, and tax constraints that would need to be addressed.

Answer

President and CEO Maria Black stated that ADP is closely monitoring the stablecoin topic, particularly from a regulatory perspective. She emphasized that ADP is preparing for all possibilities as the environment evolves, ensuring they are ready to support clients and their employees' payment preferences once regulatory clarity is achieved, viewing it as a strategic imperative.

Michael Infante asked about the Bill.com partnership, specifically the target customer profile for initial adoption, go-to-market dynamics, and potential ARPU uplift for payroll customers using AP capabilities. He also inquired about any incremental PEO versus ASO mix shift or trends in employees opting for lower-cost health plans.

Answer

President and CEO John Gibson expressed excitement for the Bill.com partnership, viewing it as a value-add to the platform rather than a significant ARPU driver. He noted its focus on small businesses, integration into the Flex application, and plans to expand from AP to AR in 2026, bundling it for overall HCM value. CFO Bob Schrader stated there was no significant change in the PEO versus ASO mix shift, with a good balance maintained, and that the PEO business performed slightly above expectations, despite agency headwinds from workers' comp.

Michael Infante asked about the Bill.com partnership, seeking insights into the ideal customer profile for adoption, go-to-market dynamics, and potential ARPU uplift. He also asked for clarification on the agency dynamic within PEO, specifically regarding PEO versus ASO mix shift or employees opting for lower-cost health plans.

Answer

President and CEO John Gibson expressed excitement for the Bill.com partnership, viewing it as a value-add rather than a significant ARPU driver. He noted its focus on small businesses, integration into the Flex application, and leveraging Bill.com's 7 million payer/vendor network, starting with AP and expanding to AR in 2026. CFO Bob Schrader stated there was no significant difference in the PEO versus ASO mix shift, with PEO performing slightly above expectations, but reiterated that the agency segment was impacted by workers' comp headwinds.

Michael Infante inquired about Paychex's strategy for the partnership channel, especially regarding embedded payroll, and asked for an update on client retention trends.

Answer

CEO John Gibson confirmed that Paychex has many long-standing partners and is open to embedded or wholesale models, highlighting the growing CPA channel. On retention, he stated that both revenue and logo retention remain strong and near record levels, with client losses improving year-over-year across all segments.

Michael Infante from Morgan Stanley inquired about the drivers for the expected back-half acceleration in core Annual Recurring Revenue (ARR) growth and the strategic rationale behind the new Bloomberg partnership for large asset managers.

Answer

CFO Jim Cox confirmed the company expects sequential revenue growth to accelerate in H2 2025, supporting full-year targets, and noted that ARR can have timing variability. CEO Sandeep Sahai explained the Bloomberg partnership is designed to deliver a full front-to-back solution for the largest global asset managers by combining Bloomberg's front office with Clearwater's middle and back office, complementing the Infusion platform which targets different segments.

Michael Infante sought clarification on the full-year inorganic revenue contribution from acquisitions and asked for an update on plans to evolve Enfusion's pricing and contract structures.

Answer

CFO Jim Cox confirmed the analyst's modeling approach was directionally consistent with internal views. CEO Sandeep Sahai simplified the model to ~20% growth for Clearwater/Beacon and 13% for Enfusion. Regarding pricing, Sahai confirmed a plan to align Enfusion's commercial model with Clearwater's for more stability. He noted this is a major initiative that will take months to develop, with a revenue impact not expected until 2026.

Michael Infante asked about how early Clearwater is in leveraging cross-sell and price increases across its client base. He also sought preliminary thoughts on the evolution of Enfusion's pricing model post-acquisition, including the potential to move from seat-based to asset-based pricing.

Answer

CFO James Cox noted that while cross-sell contributed 3% to NRR, they would like to see that figure grow higher. CEO Sandeep Sahai added that new products have surprisingly driven new logos in addition to NRR. Regarding Enfusion's pricing, Sandeep Sahai stated that while the platform is industry-leading, its commercial model 'could use a lot of help' and has room to drive NRR. He confirmed they plan to evolve the model thoughtfully, drawing on Clearwater's own successful pricing model changes from 2022.

Michael Infante questioned why the AUM impact from the recent rate cut was so pronounced and asked for the rationale behind the implied slower Q4 revenue growth, given strong demand and an easier comparison.

Answer

CEO Sandeep Sahai clarified the AUM impact was due to the resulting price increase across various asset classes, not just the rate cut itself. CFO Jim Cox stated the Q4 guidance reflects their history of delivering on commitments and should not be seen as a sign of market weakness, noting they feel comfortable with their position after a strong Q3.

Michael Infante of Morgan Stanley asked if sequential net new subscription ARR met expectations excluding churn, how deal mix is factoring in, and about the potential impact of banks charging data aggregators for API access.

Answer

CFO Jonathan Price confirmed that underlying sequential ARR adds and the deal mix were in line with expectations. Regarding aggregator fees, both he and CEO Matt Flake stated it is being monitored but is not considered a material issue for Q2 at this time, as the impact is small and the economics are still developing.

Michael Infante inquired about the impact of bank M&A on Q2's customer base and asked for details on the pricing and duration of recent large renewals.

Answer

CEO Matt Flake noted that while overall bank M&A was slow in Q1, Q2 maintained a very high win rate (95%) when its customers were involved in transactions. CFO Jonathan Price described the terms and duration of the three large renewals as typical for their respective product lines, with strong economics that will benefit future periods.

Michael Infante from Morgan Stanley requested an attribution for the 80% growth in renewal bookings, asking about the mix between cross-sell, price increases, and contract duration. He also asked about the potential for Q2 to shift its user-based digital banking pricing model to an asset-based model.

Answer

CFO Jonathan Price explained that the strong renewal bookings growth was primarily driven by a higher-than-usual volume of out-of-scope renewals and strong cross-sell attachment, not by changes in contract duration. He clarified the digital banking model is based on end-users, not seats, and that bank M&A activity is a natural tailwind under this model as it leads to renegotiations on a larger combined user base. There was no indication of a planned shift in the pricing model.

Michael Infante, on for James Faucette, asked about the technical hurdles of integrating Callistone's blockchain platform and sought an update on TATAYA's revenue recognition and full-year contribution.

Answer

Chairman and CEO William Stone noted that integrating Callistone's technology is part of their R&D focus and that their combined scale should yield better pricing. President and COO Rahul Kanwar stated they are making progress on TATAYA's revenue recognition and have good visibility into adjudicated cases, feeling more confident about the full-year outlook.

Michael Infante, on behalf of James Faucette from Morgan Stanley, asked about the drivers of GlobeOp's impressive growth, questioning if it was due to net new momentum or pricing. He also inquired about the competitive landscape and SS&C's ability to gain share in the startup hedge fund environment amid industry consolidation.

Answer

Bill Stone (Executive) attributed GlobeOp's success to its global reach and ability to provide best-in-class technology for large-scale customers investing in alternative assets, particularly in the Middle East. He noted that the startup hedge fund space is now led by seasoned investors starting with larger capital pools who demand sophisticated technology from day one. SS&C's strength with global macro funds, a key destination for alternative asset flows, positions them well to capture this business.

Michael Infante, on for James Faucette, asked about the drivers that could push 2025 organic growth to the midpoint of the target range or higher, given progressively tougher comps. He also inquired about the net new opportunity for Blue Prism and initiatives to return it to double-digit growth.

Answer

President and COO Rahul Kanwar pointed to the company's strengthening and growing recurring revenue base as a positive leading indicator for 2025. Chairman and CEO Bill Stone added that deal sizes are increasing and reiterated confidence in the 4-8% mid-term target. For Blue Prism, he mentioned management changes, increased investment, and the integration of AI and large language models as key initiatives to reaccelerate external growth.

Michael Infante of Morgan Stanley asked about the economics of the small dollar loan product and the potential impact of a new political administration on future origination trends.

Answer

CEO Dave Girouard confirmed the small dollar loan product operates with positive economics and is a strategic tool for expanding the borrower base and training AI models. He also stated that Upstart's business is not dependent on which political party is in power, as the company has grown through four different administrations and focuses on internal drivers for growth.

Asked about the outlook for the new fund formation pipeline in 2024 and questioned the reasoning behind the adjusted EBITDA margin guidance, which implied a lighter incremental margin compared to recent results.

Answer

The company sees a balanced picture for fund formation and is diversifying its client base beyond new launches. The EBITDA margin guidance is ranged to provide flexibility for strategic product investments under the new COO, with the potential for higher margins if those investments are pushed out.