Recurring Revenue Growth Outlook
Q: What factors are driving 6% recurring revenue growth vs. 9%, and outlook?
A: CFO Edmund Reese explained they're tracking 6% recurring revenue growth, at the low end of their strong organic range. Two factors impacting this are position growth, which is at 6% for equity positions and 3% for fund positions, below their mid-to-high single-digit outlook, and lower revenue in their customer communications business. However, they have positive momentum going into fiscal '25 and '26, with sales estimated to be up 15% to 30%, and position growth starting to tick up, with Q1 '25 testing data showing mid-single-digit growth. They feel confident about meeting their 3-year objectives, delivering approximately 6% recurring revenue growth and 10% adjusted EPS growth, aligning with their growth algorithm.

M&A Opportunities Post Deleveraging
Q: After deleveraging, where are the greatest acquisition opportunities?
A: CEO Tim Gokey stated that, having reached their leverage and free cash flow goals, they now have flexibility to invest in acquisitions. The logjam between buyers and sellers is beginning to break up, and they're seeing more tuck-in opportunities that meet both strategic and financial criteria. They're focusing on areas like wealth management and data and analytics, with interesting developments. Gokey emphasized they will be very selective, seeking opportunities with IRR in the mid-to-high teens, ensuring good returns for shareholders.

AI-Related Product Development
Q: Where do you see biggest AI product development opportunities?
A: Gokey expressed excitement about AI, stating they are bringing AI into all their products. They've made progress with OpsGPT and BondGPT: OpsGPT is in production with the first client and engaging with another five, while BondGPT has three proof-of-concepts underway and eight additional discussions. They're also working on their global demand model in asset management, with six of the largest 50 asset managers signed up and ten more in contracting. They see opportunities in deepening areas where they can leverage proprietary data, especially in capital markets and fixed income.

Bookings Trends and Deal Sizes
Q: Are deal sizes expanding and what are pipeline characteristics?
A: Gokey noted that the main thrust continues to be lots of manageably-sized opportunities, without mega deals that take years to influence. Some deals are over $5 million, but generally they're focusing on opportunities that drive revenue, such as adviser tools and securities class action, and areas that drive costs like print-to-digital and regulatory changes. These areas align with their investments, and they're seeing good demand.

Wealth Management Opportunities
Q: What wealth management opportunities are resonating with customers?
A: Gokey mentioned their investments in wealth management are paying off. Sales were up 75% for the year, and the current pipeline is over $200 million. Customers seek to address specific pain points and establish a digital roadmap, appreciating their open API framework and enterprise integration service layer. Clients start with tangible pain points like tax, client onboarding, and corporate actions. They have positive engagements in the US and Canada and feel confident about the outlook.

Timing of Shareholder Meetings Impact
Q: Does the delay of shareholder meetings impact revenue lines?
A: Reese confirmed the delay impacts the registered shareholder solutions and issuer revenues, as well as the regulatory business, but not the data-driven fund solutions or customer communications lines.