Good day, and thank you for standing by. Welcome to the Worldline H1 2026 results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Pierre-Antoine Vacheron, Group CEO. Please go ahead.
Thanks a lot. Good evening, everyone, and thank you for joining us for Worldline's H1 2026 results call. I am joined by Srikanth Seshadri, our Group CFO. I will take you first through the key business highlights and strategic progress before Srikanth presents the financials in more detail. I will start with slide five. H1 marks an important step forward for Worldline's turnaround and transformation. Everything is not done yet, far from it. We delivered what we committed for the first half. This period shows clear momentum across the organization. First, as you know, we have significantly strengthened the balance sheet together with a successful capital increase. The closing of most of the M&A transactions, including the super important MeTS and CAWL. We have significantly reduced our net debt with a leverage which is now down to less than two times the EBITDA.
Second, Merchant Services has regained traction with a second consecutive quarter of growth and even acceleration during Q2. Financial Services remain impacted by contract termination as planned. Also by a longer sales cycle than we would have liked. Still, the quality of recent important wins reinforces our confidence in our positioning and midterm trajectory on this segment. Third, North Star is working and delivering tangible progress on the priority we laid out at the Capital Markets Day across simplification, platform convergence, integration, and commercial execution. Finally, sorry, our profitability is starting to improve, especially on Merchant Services, supported by disciplined cost management and the first benefits of our transformation program, with reduction of headcount in Western Europe ahead of our 2030 trajectory. Turning to slide six and the key figures for H1.
As you can see, our payments volume continued to grow steadily, probably in line with the market trends, with acquiring volumes more than 4% in the semester. For the full semester, external revenue were broadly stable year-over-year and flat in the second quarter. Net revenue remains negative as anticipated at the Capital Markets Day, reflecting the mix and the dynamics across our geographies and segments. Adjusted EBITDA reached EUR 294 million, with EBITDA margin improving at net revenue level for the first time since H1 2023. Free cash flow remains negative. It is better than anticipated, reflecting disciplined cost management and better capital allocation. On slide seven, you can see that Q2 showed encouraging improvements across all businesses. Merchant Services, which represent 80% of our external revenue, continued to gain momentum, supported by stronger customer focus and improving satisfaction.
We are seeing encouraging performance with high single-digit growth across several geographies and segments, including Greece, the Nordics, Central and Eastern Europe, Germany, mobility and self-service within enterprise, and in our Global Collect entity. Switzerland and Benelux are also moving in the right direction, with Switzerland close to flat in Q2 and Benelux still negative though. Financial Services, which represents 20% of our external revenue, is recovering more gradually. While performance continues to reflect anticipated contract termination as planned, it also reflects longer sales cycle due to our own context. Nevertheless, we managed to secure several important signings that reinforce our confidence in the positioning and the medium-term trajectory of this business. To highlight this, I would like to comment on two important commercial milestones for Financial Services.
The first one is the signing of an outsourcing agreement with ICS, which is the ABN AMRO entity managing the credit card issuing portfolio of the group. This selection is a confirmation of the attractiveness of our modern card issuing platform that does cover the full life cycle of the card. It demonstrates the confidence of a leading European bank for a long-term partnership at scale with Worldline. It reinforces our position as a trusted infrastructure partner for the financial sector. As a reminder, we serve, as Worldline, around 80% of the 20 top European banks. The second milestone I would like to comment is the selection of Worldline for the digital euro pilot. We will operate in this case on both sides of the value chain, the bank of the consumer, and the merchants, which is one of our differentiating strengths.
This decision of the ECB confirms that Worldline is legitimate and well-positioned on the payments rails of tomorrow. The slide nine shows that since CMD, we made tremendous progress in multiple areas, showing the breadth and the depth of our action. On the corporate and M&A side, we are reaching the final stage of the disposal program, with most transactions now closed, and Australia and India coming soon.
On the business side, we have signed and implemented several partnerships to enrich our offering, either to go beyond pure acquiring with Klarna and Worldline, or to position Worldline on the next generation rails, including Wero, stablecoins, and the digital euro. In parallel, we gain traction in deploying meaningful and innovative product features, Click to Pay for recurring payment, where we are the first one in Europe, and the Spanish Bizum wallet in store, where again, we are the first one in Europe.
On slide 10, we show that sorry, North Star is clearly in motion and delivering. To pick up some particular highlights in this slide. Platform convergence continues to advance with the Italian acquiring portfolio migrating to our target platform. We have 5,000 merchants migrated as we speak, and things move smoothly. The Ogone and Sips portfolios are moving to GoPay as planned, and we reached, in June, 80% of the SME portfolio on GoPay. At the same time, we continue to simplify and modernize our technical infrastructure and network, moving from 49 to 47 sites and closing our Madrid data center. In terms of integration, Launchpad has now entered in a pilot mode, in line with plan. This is again an important milestone in our recovery journey. As you certainly remember from our presentation at CMD, Launchpad is the backbone of a dramatic modernization in our SMB customer journey.
We've targeted onboarding in one day for low-risk merchants, with full automation of the process. This version is the first step, available on a first segment of the market. The foundations are now in place for step deployment every quarter going forward. All those initiatives have enabled good progress on active workforce management, leveraging internal mobility to reduce headcount in Europe, while preserving critical skills and capabilities. I would like to highlight three visible examples of North Star executions during the period. On simplify, the Crédit Agricole partnership evolution is a good example of simplification. Here, we have demonstrated our ability to make tough and bold decisions to simplify and be more efficient. Together with Crédit Agricole, we have agreed on a simpler and more efficient operating model that is better aligned with the future development of our partnership.
No need to say that we are extremely proud of the successes of this partnership, which works extremely well on acceptance and brings innovation to the French market. Second illustration on integrate, the Global Collect case. Global Collect is one of the hidden jewels of Worldline, making 2/3 of external revenue of the Global Commerce division. As a reminder, the rest of the division consists of pure acquiring activities for a portfolio of travel and digital customers. Over the last few months, we have successfully integrated Global Collect with Worldline's acquiring platform, developed shared agency commerce capability, while repositioning Global Collect within the group with a dedicated setup and operating model to focus on two attractive verticals, travel and digital, with complex cross-border requirements. Combining high performance, reinvested technology stack, and deep integration into customers' ecosystems, Global Collect benefits of a differentiated value proposition.
The revised operating model and the leverage of Worldline's shared capability is already translating into improved commercial traction and return to high single-digit growth in the last quarter. I clearly count on Global Collect to be one of the faster growth engines of Worldline going forward, leveraging on faster dynamics of cross-border payments. Finally, on the grow pillar of North Star, I would like to comment on the progress of Worldline in agentic commerce. As you have seen from our recent announcement, Worldline is positioning itself at the forefront of agentic commerce for the European market. First, we have built the technical foundation, what we call the MCP Server, to expose Worldline payment capability to AI agents and large language models platforms. Second, we have built the technical foundation and the infrastructure, which is protocol agnostic, to support the various Visa Intelligent Commerce, Mastercard Agent Pay, or Google-specific protocols.
Third, we leverage on our unique positioning on the issuing and acquiring side to ease trust and adoption across the ecosystem. This was the objective of the real end-to-end transactions that we executed in the three geographies with two banks, ING and Crédit Agricole. At Worldline, we believe agentic commerce has the potential to reshape how consumers and businesses interact with payments. This is why it is important for Worldline to provide the banks and the merchants the infrastructure layer required to support this evolution with trust. On the following slide, we show how we are accelerating GenAI through a trusted AI operating model. We have seen over the last six months, a significant acceleration of adoption of GenAI across the organization. Given the critical role Worldline plays in the economy, we have built all the foundations to deploy generative AI, Gen securely and at scale.
Infrastructure, governance, financial impact measurement, risk management, and security. Those foundations are now in place. We are rolling out GenAI through a multi-model approach to avoid dependency on a single model. As you can see here, the deployment is now becoming meaningful with 83% of our developers using AI-assisted coding and testing tools, and 9,000 monthly active users of Libor Chat, our internal agentic AI chat platform based on open source. More importantly, we are already seeing a ramp-up in impact, higher development velocity when using cloud code in software development, concrete business impact through use cases such as smart routing on e-commerce, and progressive agentification across several functions in the organization. At Worldline, we clearly consider generative and agentic AI as a vehicle of transformation and customer satisfaction. What is new at Worldline is not GenAI itself.
What is new is our ability to deploy it securely and at scale through a trusted operating model at the forefront of the European financial industry. With that, let me hand over to Srikanth, who will take you through the financial performance in more detail.
Thank you, Pierre-Antoine, and good evening, everyone. Before I go into the numbers, the financial section, again, reiterates the four messages that has been mentioned on our execution. H1 results were in line with our expectation on a fully prune basis. Merchant Services is showing improving momentum sequentially, while Financial Services remains impacted by the known contract terminations and timing effects of commercial rebound. Third, the inorganic balance sheet strengthening is complete. Fourth, our 2026 outlook confirms the adjusted EBITDA and the leverage target with an improved free cash flow trajectory, and the leverage target has been achieved six months in advance than what we had said during the Capital Markets Day. You also recall what we anticipated at the Capital Markets Day back in November on three points.
The IFRS loss of contracts, the business mix, which we said would be adverse with more cross-border and within Merchant Services that will impact the net revenue, that the North Star will start providing early returns in our EBITDA, and we already see that. Now, on that messages, if you go down to the next slide, Pierre-Antoine has already taken you through the post-prune numbers, what you have also here is the published numbers, I will detail that in the coming slides with an elaboration and scope so that we are all clear on what each number means for what scope. Additionally, normalized net income was EUR 65 million, and a normalized diluted EPS at EUR 2.04. The key point is that after pruning actions, the underlying business is stabilizing while profitability and balance sheet discipline is improving. Moving on to the next slide regarding the divestment update.
The pruning program is complete substantially. Two deals still to close, Australia and India. We expect that in Q3. We guided you that between EUR 590 million and EUR 640 million of net proceeds will be received. We have already received EUR 580 million, with EUR 40 million to EUR 50 million additionally to come from India and Australia. That puts us in the high range of, on the upper end of the range that was communicated earlier. This, of course, excludes the cash held in divested entities, which is addressed now in the liquidity section. Moving on to scope. You recall that we provided quite a bit of pedagogy on the scope for the end of the year. This year is a step more in complexity. We said 2026 will be a year of transition. It is, of course, with a transitory scope.
At the bottom part is the green block, which is our fully pruned scope. It is the constant. It is the future perimeter of Worldline after this year of closing, those transactions will be finished. Looking at the published scope, you all know now that the IFRS 5 governs the rules for discontinued operations as well as assets held for sale. MeTS being the discontinued operations has not been in our scope from day one. However, the assets held for sale, all of the other divestments that you see below, the P&L and cash flow are in our published numbers until closing. Hence North America and PaymentIQ, we closed end of February. January and February is in our numbers. Cetrel we closed end of April. Jan to April is in our numbers and so on.
Obviously India and Australia, still not closed, is still in our published scope. That's the purple part, which is the published scope. Then the green one is the fully pruned, and we have even color-coordinated that in the rest of the presentation. Moving to the next one. Applying the scope to the present numbers, I would not go into the detail, but this slide has been presented just specifically to bring clarity and the full impact of scope changes for all of us to be on the same page. In white is the FY 2025 H1 published scope. It is only without MeTS. In the purple H1 2026 is with the progressive closing of the transactions that I have just explained. We have done a pro forma for 2025 so that you have a like-for-like comparison.
In the green is the post-prune scope that we are all on the same page on. No need to go step by step, but we have addressed the impact on revenue, adjusted EBITDA and free cash flow. We will of course deal with each one of these in the future slides. Moving on to the next one, please. On the post-prune scope, we see for Q2, on Worldline level, we are flat at EUR 904 million, with Merchant Services showing a +2%. Sequentially better in external revenue as compared to Q1, with acceleration across segments that I will explain in a second. Financial Services is the drag on house like Q1 with the -6.9%. At the end, we are flat in terms of our post-prune revenue.
On a net revenue basis, Merchant Services is at -2% for Q2 and Financial Services at -6.8%. Moving to the next slide, drilling down into the specifics per segment. SMB is growing low single digit. Continued momentum in the Nordics, Germany, Italy, Greece, Central and Eastern Europe. Switzerland is further stabilizing. Benelux showing gradual recovery. Commercial traction is improving with partner and in Independent Software Vendors. Enterprise is also growing low single digit with continued strength in mobility and self-service, including petrol and transportation. One Commerce is gaining traction in Germany, the U.K. and Poland. In Global Commerce, travel remains strong and Global Collect is back to growth while the digital vertical is still affected by expected churn. Moving on to Financial Services. H1 remains the drag as we have been mentioning so far. The underlying commercial dynamic, however, is positive.
In issuing and account payment, the decline reflects the legacy terminations, while the ABN AMRO deal that Pierre-Antoine mentioned gives a strong future growth platform as are other items in our pipeline that we will continue to follow and also harvest the digital and value-added features. Acquiring, growing across geos, and we are also supporting Wero. Digital Services seeing early positioning benefits of new products, which was also explained by Pierre-Antoine. Moving on to the H1 financial performance fully pruned. Group delivered broadly stable revenue, -0.2% on external revenue. In terms of Merchant Services at +1.8% offsetting the -7.1% decline in Financial Services. Adjusted EBITDA was at +EUR 294 million. Merchant Services improved its EBITDA margin by 70 basis points on external revenue and 170 basis points on net revenue. Financial Services margin declined as expected due to the run contracts loss.
Moving on to slide 24 on published P&L. While the fully pruned scope is the most relevant view for management, guidance, investor assessment, and published scope is necessary for statutory reporting. This table shows H1 2025, excluding MeTS and H1 published scope as presented earlier. The scope column aims to make the like-for-like, so that is making the white bar purple, right? For like-for-like comparison and for each line item with the pruning program and FX. Key takeaways in two sections. First, operating expenses. Personnel expenses decreased year-over-year, reflecting the reduced headcount in Western Europe. Strict cost control helped to protect our adjusted EBITDA despite higher scheme fees. EBITDA is better year-over-year with the like-for-like scope by EUR 40 million, and you see that is the reduced rationalization and integration cost due to the end of spend on Power24.
Second block is on the non-operating expense. Net financial expenses in 2026 absorb higher interest cost, but unlike 2025, there are no more exceptional items. Moving on to published free cash flow. Free cash flow remains a key area of focus and to improve the quality of the free cash flow. Three key pillars, the restructuring and integration cost declined sharply, as we just saw. Taxes are lower. We have done some fiscal consolidations, and it helps partly offset higher financial cost. Working capital. With the quality of cash flows generated, we are reinforcing working capital here with a reduced level of payables and also reflecting the smaller perimeter going forward. Now to net debt leverage and liquidity. We have halved the level of net debt in the first six months. We have gone from EUR 2.2 billion to EUR 1.1 billion. Result, leverage target is less than 2x.
That's been achieved six months earlier than announced, and that's good. On the right, we show the liquidity has been strengthened as a result as well of the pruning and equity infusion. This is sufficient in order to face the 2026, 2027 bonds as well as the puts. Also we have obtained the EUR 80 million which is the cash in divested entities. You'll recall we had the EUR 186 million of cash in divested entities in December 2025. We've received EUR 80 million. We have another EUR 90 to go. The EUR 90 is in India and Australia, and with the EUR 40 million-EUR 50 million, we should have this crystallized as well in Q3. Finally, the second extension of the RCF has been obtained to go from July 30 to 31 for EUR 900 million and until 2030, we are at EUR 1.125 billion.
80% of that has been extended on the same terms until 2030. I'll conclude with the outlook. We have already achieved our leverage targets, as I mentioned. We confirm our adjusted EBITDA of EUR 630 million-EUR 650 million, supported by cost discipline. Improved free cash flow guidance. We upgrade our free cash flow guidance with better capital allocation. And we are marginally revising the revenue, as mentioned, due to the timing effects on the commercial rebound on Financial Services, but with recent contract wins and pipeline, we are confident this will recover. Merchant Services growing as planned. With that, I will hand you back to Pierre-Antoine to conclude. Thank you very much.
Thanks a lot, Srikanth. Four message to conclude this presentation. First one, by demonstrating progress, Worldline H1 performance are data points that strengthen conviction in our vision and in the success of our turnaround. Second message, we made the right choice in refocusing on Europe. The organization is clearly gaining momentum and discipline across the board, and this is visible in those results. Third, while executing, Worldline position itself with success on the future industry drivers while managing its capital allocation. Finally, we are demonstrating our ability to control our cash costs with discipline, which can help navigate the volatile macro context in which we operate. Thank you, and happy to get your questions.
Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We will now take our first question from the line of Frederic Boulan from Bank of America. Please go ahead.
Hi, good evening, Pierre-Antoine and Srikanth. Thanks for taking the question. Three questions, maybe one, starting with Pierre-Antoine, if you can give us an update on the kind of competitive and microdynamics. MSV growth seems to be stronger in the 2Q, it'd be good to have a bit of an update there. If you can come back on what happened with the JV with Crédit Agricole, who initiated the end of the structure. What does it mean for you in particular? I understand the acceptance business from Worldline was supposed to be brought into JV, what happens to this? I mean, is it staying with you? Question for Srikanth, if you can spend some time on the free cash flow moving parts in H2 and 2027.
I understood from your commentary that the commentary on the working capital was positive, I can see about EUR 100 million worsening in working capital on the Slide 25. I'm not really sure what's going on there. That seems to be offsetting most of the reversal in restructuring costs. Any commentary around moving parts in H2 and next year would be great. Thank you.
Thanks a lot for those questions. On the competitive and micro dynamic, you're right. We have a very sound growth in merchant acquiring volumes in H1 and more importantly, in Q2. Let's say that the verticals on which we've been exposed have been behaving well, especially travel, especially large retail, especially mobility and self-service. Obviously there is some contrast, depending on the segment, with specialty retail, which is behaving not that good, especially in some geographies like Germany, as you may have heard already. Globally, we have these good dynamics and since many of our geographies are now behaving well, with a significant growth, as I mentioned, high single-digit growth in various geographies, but also in mobility, self-service, and Global Collect in the last period, that feeds this good dynamic in terms of MSV. Regarding the JV with the Crédit Agricole, it's super simple.
I have assessed what was the potential of a model where there was no contribution of acquiring portfolio by the bank to the contrary of the other JVs that we have had. It was massively, I would say, acceptance, partnership in acceptance, and having a regulated entity in a bank context was clearly heavy as compared to the potential that we had. Today we are focusing on acceptance services. We are providing to CAWL that remains an entity retained by the Crédit Agricole, that itself serves the caisses, the original banks of the Crédit Agricole. We are providing them acceptance solutions, and it's working well, and besides that, we are partnering between our own acceptance that has not been contributed, and their own acquiring for enterprise merchants on which we have, as you know, strong positions. It's a joint decision.
We came to a similar diagnosis between Crédit Agricole and ourselves at Worldline. It has been quite natural to come to that decision, which is, from the outside, a bit surprising, probably, but which makes a lot of sense, and that's the way we want to drive our business. On the free cash flow, Srikanth?
Thank you, Pierre-Antoine, and hello, Frederic. What I was mentioning is indeed the end of spend of Power24, and also better progression on the R&I for the current year. We do expect to have a lower spend, and we had also some phasing effect in H1. You see the two impacts. In terms of working cap, essentially taking a step back, this year we've said it's been a reset. We have strengthened the balance sheet with all the inorganic measures, and we're also taking a good look at the organic measures to ensure that we are able to have the right measures going forward. We've reduced the level of payables and also with the smaller perimeter, to have a level that's manageable from the seasonality as well as the ups and downs of the business until we stabilize.
Hence, this creates, again, from H1 last year to H1 this year, but in terms of working cap outflow this year is EUR 60 million, as you see. It's primarily reduce of payables as well as some reduction in advances.
Sorry, just to clarify, you expect EUR 60 million outflow for this year, so same as H1?
We'll expect this to normalize in H2 indeed. Again, we'll need to have some effects for H2, but it will be more normal in H2 as compared to what we had in H1.
Thank you.
Thank you. We will now take our next question from the line of Justin Forsythe from UBS. Please go ahead.
Hey, good evening, Pierre-Antoine and Srikanth. Thank you so much. A couple of questions from my end. Srikanth, I wonder if you could just walk us a little bit through the moving pieces, and the revenue guide. I think we had a bit of an actual, as you flagged very clearly, a stronger merchant solutions result in 2Q, yet we take down the full year revenue guide. You're saying that's attributable to Financial Services if I understood you. If I have that correct, we should be basically taking that, call it 1 point down at the midpoint out of the FS line. You could be talking about something like a 10%-15% decline for the full year in FS, if I have that correct?
Does that mean the Q2 result in MS, you say no changes, should we be expecting off of that, call it accelerated base into Q26? How do we think about it? Then just a question on the strength that you called out, the high single-digit growth, Pierre-Antoine, that's obviously quite promising in some of the geos that you laid out. Germany was the one that seemed out of place in a way, in my head, because you've clearly had challenges there in the past, and one of your peers just flagged pretty severe weakness in that same geography. Maybe you could outline a little bit there. One just clean-up question, perhaps to Srikanth, on the Crédit Agricole deal, following on from Fred's question. Could you be a little bit more clear on the price paid? You both have contributed expenses into this JV.
There is, I presume, some sort of, I believe, if I remember correctly, some revenue-sharing model that was at place. Now it's more of a commercial referral relationship. How much is being paid by Crédit Agricole for that? Maybe you could just be clear as well on what acceptance solutions you are providing. What is it exactly that you're enabling for the go-forward commercial partnership? Thanks.
You take, yeah, you want me to start with the Crédit Agricole and the Q2? On Crédit Agricole, today, what's working well is the e-commerce solution. We've been distributing GoPay, our new e-commerce solution for Europe, to the Crédit Agricole since 12 months now. It's working well at the speed of the bank distribution. Besides that, we are partnering commercially on the acceptance solutions. You know, the Axis platform, which is extremely successful for large enterprise merchants. Here we are combining, when it makes sense, our proposal on acceptance, and the Crédit Agricole comes with its acquiring capability. Going down the road, the idea is to provide POS also for the POS solutions for the SMB, but that's, I would say, a stage 2 as compared to what we are providing today. Okay.
For all that, the revenue generation is based on the shared revenue on the acceptance between the Crédit Agricole group and ourselves. Okay.
Thanks, Pierre-Antoine. Hello, Justin. On the revenue, on FS, as essentially we said, we'll have a EUR 60 million impact coming from contract terminations, and we've seen exactly half of that. We had EUR 15 million in Q1, we have a EUR 30 million in Q2, and we expect that to be the effect of the run contract loss. We'll offset that partly in H2. We'll be somewhere between 6%-7% as compared to last year of lower, 6%-7% as compared to last year.
Okay, got it. Could you just clarify what you mean on MS then, because or what changed? If that was already in your expectations, if I understand you correctly, then maybe help us understand why the guide moved down at the midpoint. Is that something tied to MS then? Because it sounded like you were saying MS is going to be stable. Is there any macro conservatism layered in there given the environment's a bit shaky right now?
Maybe, three comments on that. As you noticed, we have, Srikanth commented on that, between the growth in volumes and the growth in external revenue, there is a gap, which is linked to the geo and merchant mix that we have witnessed in Q2 and Q1, that is a bit dragging us behind in terms of growth of external revenue. The second element is that in Q2, we've been benefiting from delayed in some merchant migration outside our scope, that will push down a bit the growth in enterprise as compared to what we've been witnessing in Q2. I would say that's the second element. I think that most of the elements, obviously, we are a bit conservative about the macro context, because up to now, and that's a surprise for the whole industry, consumption has remained quite strong in Q2.
We may anticipate that things evolve in the second half of the year. Yes, there might be some elements of conservatism that we are taking into account. I think the very important point is the commercial traction across the board. The fact that the NPS has improved on each of our segments, the churn has reduced also in each of our segments. I would say, really the fundamentals of our business has improved. Again, the signing of ABN AMRO is very promising for us, because it shows that we have turned the page of the scrutiny that we've been going through in 2025.
Awesome. Thank you so much for that one. Pierre-Antoine, if you had anything just on that last point on Germany to add, that would be helpful. Really appreciate the time, both.
Yeah, sorry. Germany has been behaving well in Q2. Remember that we had been struggling the previous year, so to some extent, we have an easier comparison than maybe some others. Yeah, we have good traction. We have had good traction in Germany in H2, especially on the SMB front, but also in some verticals in enterprise with lower margin because of the segments, but with strong traction. We are better exposed probably in what we call FMCG, which is all the discounters in Germany.
Thank you. We will now take our next question from the line of Hannes Leitner from Jefferies. Please go ahead.
Yes, thanks. Maybe I can add a couple of more after Justin. Maybe you can talk about net net revenue basis, especially for the Merchant Services. When do you expect basically to break even and to move to a growth and to sustainable growth there? Maybe that's how you can square that in the guidance. Just like maybe you gave in previous presentations, always a nice overview on the SMB segments per geographies. How did the turnaround and the stabilization perform? Maybe you can help there. What is the visibility? Because I believe that this is the big moving part, which can then sustainable push Merchant Services in the growth territory. Then maybe just like in terms of your capital raise and the big shareholders who joined your cap table, when can we expect some Financial Services wins in France, in your home region? Thank you.
Thanks a lot for the question. Maybe I will start on the NNR and Srikanth will complete. If you remember well at the CMD, we said that we would still have negative contribution margin evolution in 2026 as compared to 2025. We'd model that, and this is linked basically to the anticipation we are making of the order of recovery depending on geographies. For historical reasons, we have stronger margins in Switzerland and Belgium, which are the latest to recover as planned to some extent. The fastest growing segments, it's the Nordics, where we are mostly distributing or massively distributing through partners and ISVs. There, the margin is lower. Central and Eastern Europe, it's also lower margins. Obviously travel is also lower margin, and it has been behaving well, thanks to the Global Collect new dynamic. It was planned to be like that.
The more we will be able to recover in the two historical CAWL geographies, the more we'll be in a position to reverse this trend. The more SMB will grow, the more we will reverse the trend, the more acceptance will grow. You remember that we have been suffering of churn in e-commerce because of the migration of portfolio. This is now behind us, so there will still be impact in H2, but it will be behind us in 2027. The more acceptance is growing, Financial Services growing, the more NNR is growing as compared to the external revenue. I don't know, Srikanth, if you want to add something on that?
I think we could also say it depends exactly on the channel to market. As you were saying, Pierre-Antoine, also in Italy, we go through banking partners, and Italy has also shown a large growth. Therefore, we have had a specific impact on this, which goes exactly between external revenue and net net revenue. On your question, Hans, and hello, regarding when do we start forecasting the net net revenue and when can we see sustainable growth? It's exactly that. I think when we start, SMB obviously was a key vector that we mentioned along with Financial Services. SMB is accretive and which have a much lesser gap between external revenue and net revenue. Once we start turning around the larger markets, we should be able to see more sustainable growth. I'll stop there.
The good news that you don't see in the numbers is that we have implemented some repricing initiatives as part of North Star in Q2 that start to generate. That will help also in H2. That has helped us to stabilize the take rate in many segments, which is obviously a good news. It's not because of commercial campaigns that we are losing take rate and net revenue. I think it's an important message. Back to your question on SMB. As I said, taking the various geographies. Central and Eastern Europe doing very well and more dynamic, I would say, in Q2 than in Q1. In Southern Europe, Greece is doing extremely well. Double-digit, if I remember correctly, on acquiring. Italy is benefiting still of the migration of new portfolios.
Anticipate more stable Italy in H2 once this migration has been done. The other side of Europe, Nordics, is now sustainably very high single-digit growth with a very strong performance of this geography. Germany, as we already said, has been behaving well in Q2. Remains Switzerland which is close to stable in Q2 and Belgium and the Benelux more globally speaking, which is still in the negative territory. We still have progress to be done there. The Launchpad, once it will be spread on the market for new merchants on the whole scope will help. This is where we are today.
Thank you.
We will now take the next question from the line of Yaamir Badhe from Barclays. Please go ahead.
Thank you for taking my questions. I have two questions. Firstly, you've lowered the revenue outlook, but maintained EBITDA. Why is the top line downgrade not impacting EBITDA? How much of a buffer do you still have there? Secondly, what drove the improvement in Merchant Services on an organic basis in Q2 specifically, versus the deceleration on a net basis?
Take the one on the video.
Yeah. Thanks for the question. We were on a low single digit in terms of revenue guide. What we have seen as well is in the first half, the strong cost control we've got. We expect that to be more than achieved for the second half, and therefore giving us the ability to still meet the adjusted EBITDA target both on cash and cost. We've seen actions being implemented. I feel that the revenue impact that we've got will be offset by, and we have actions in place now that we've delivered in H1, and we need to continue into H2 in order to protect our EBITDA margin. Hence, we've kept our guidance at EUR 630-EUR 650. On the Q2 acceleration.
The spread of the NNR, yeah.
The spread of the NNR. Yeah, that was exactly what we had just said earlier. I would really break it into two aspects. One, like we were saying, the acquiring MSV is growing at 4.4%. Our level of acquiring revenue grew at 4%. Hence, Pierre-Antoine's point that there's no take rate issue on external revenue. It's more on the channel to market that impacts us on the net revenue, because of the partner fees and the scheme fees. If there are more cross-border, you have higher scheme fees. That's one aspect. Secondly, we have also seen that we have gone from Ogone to GoPay in the SMB market on acceptance platform. We are at 80%. We've gone from 50%-80%. That has created a lot of churn in the SMB market on acceptance.
When the acquiring proportion of your total revenue is higher, the scheme fee is also higher. That has also resulted in reducing the net revenue. The geographies we mentioned, either the business mix within Germany o r the geo mix, such as more in Italy and less in Switzerland, creating the third pole. I would say this is what creates the spread between external revenue and net revenue, and the cost actions regarding the adjusted EBITDA, what I addressed before. I hope that was clear.
Great. Thank you.
You're welcome.
Thank you. We will now take the next question from the line of Emmanuel Matot from Oddo BHF. Please go ahead.
Hello, Pierre-Antoine. Hello, Srikanth.
Hello.
Three questions for you please. First, what explains the positive surprise in Q2 revenue? There was an improvement compared with Q1, contrary to your expectations at the end of April. Is that coming from a specific geography, a better churn than expected, product mix? To clarify that point. Second, how advanced is your plan to consolidate the platforms dedicated to Merchant Services? Did you close some of them in the first half of this year? My last question is about Financial Services. Are you still confident of returning to growth in 2027 despite a longer commercial cycle? Thank you very much.
There is no magic in Q2 versus Q1. It's just the momentum and the discipline of the organization that has significantly improved across the Q2. To be honest, we are performing better across the board as compared to what we had in our anticipations at the beginning of the quarter. It's really structural, hopefully, good news in terms of discipline and momentum across the board. On your second question, remember that we have closed one platform in Q1. That was the Wopa platform, Latin American platform, that has finally migrated to Global Collect. As I said, the main topic visible that we will have at the end of the year, the turn of the year, will be hopefully the Italian resourcing from Fiserv. What we are working on with these 5,000 merchants already.
Another visible thing will be the termination of Ogone legacy, that will be completely shut down. I think we have two other platforms that we are not communicating on, but that will be also closed at the end of the year. The program is really well progressing, well executing, which is reassuring. We keep the focus like that. We do not exclude, but I don't want to overpromise, but we do not exclude to be able to accelerate on the back of the use of GenAI, typically in these caisses, to be quicker in the assessment of the gaps to cover and then to make them happen. We'll see that in Q3. Your last question.
On FS returning back to growth.
Yeah. What we said last year at the CMD is that the back to growth of FS will not be before the second half of 2027. Obviously, we do not have any reason to accelerate that anticipation.
Yeah. Thank you very much.
Thank you. We will now take our last question from the line of Alexandre Faure from BNP Paribas. Please go ahead.
Hi. Good evening. Thank you very much for squeezing me in. A couple of questions, if I may. First one is on SMB churn. I think, Srikanth, you mentioned a minute ago about sort of moving or consolidating platforms and away from legacy Ogone had resulted in some churn as I think we probably all anticipated. Should we expect more of the same as you consolidate further platforms? Coming efforts are quite different, more back-end related, and sort of invisible to the merchant and the SMB merchant in particular? That's my first question. Second question is more of a clarification, definitely for Srikanth. If we go back to slide 26, I'm interested in your liquidity position. I'm going to need some hand-holding just trying to understand where you stand at the end of June, and what sort of ins and outs we should expect for the second half.
Thinking of put options, I think you had one of them, I think that's the second one. Proceeds from divestments net of cash in subsidiaries, the debt pay down, all of that. If you could go back on those different in and outs, Srikanth, that would be super helpful. Thank you.
Yeah, sure, Alexandre.
Yeah, please.
Turn. Yeah. You want to go ahead?
Okay. I think your analysis is right. When we are speaking about acquiring, that's basically behind the scene for the merchants who are more exposed to the need to reintegrate when we're speaking about acceptance, the front end of the value chain. Here we do not expect, if the service is good, which is the caisses, any impact in terms of churn coming from convergence on the acquiring platform. It's really on the acceptance front. We are not fully done on acceptance. We've been working hard and now we need to finish the Sips, which was the Worldline- e-commerce platform.
The SMB is almost done also. Now we are on the enterprise part of things, where we have good, I would say adoption of the new platform after RFI by the enterprise merchants who select our GoPay solution. There is also some churn there. When we will migrate some other more secondary platforms to GoPay, we may also experience some churn. I think while we were much more exposed in the Ogone scope and the French scope than in the other platforms that are more operating in Central Europe, where we are very strong position.
Got it. Thank you.
Thank you.
Yeah, thanks. Maybe just to close off on Alex' gives and takes for H2. Obviously, the big one is the EUR 414 million of convertible that is getting retired.
We have, as you rightly said, we already paid out the Greek put. Now is the Italian put with Axepta that's still pending. That's going to be in Q3. I think we have a liability of EUR 150 million recorded, but it still requires to be valued before the call or put is exercised. That's in terms of the outflows, with another EUR 10 million-EUR 30 million in terms of organic cash going out in H2. Those are the cash out. Ins is really the divestment of Australia and India to come, the EUR 40 million-EUR 50 million, as I was mentioning, that needs to come in. Of course, we've already integrated the EUR 90 million within our liquidity that we were presenting in that chart.
Right.
That would just come out of divested entity into continuing operations.
Super clear. Thank you so much.
Perfect. Welcome.
Thank you. There are no further questions at this time. I would now like to turn the conference back to Pierre-Antoine Vacheron for closing remarks.
Thanks a lot. I will not make too many remarks because it's quite late for all of you on this almost last day of July. As you see, we have a good momentum. The turnaround is moving clearly well. The transformation is on track. We are well-positioned. Need to continue the discipline execution and I'm absolutely convinced on the perspectives of this company. Thanks a lot and looking forward to meet with you after the summer break. Have a good evening.
Sure. Good evening. Thank you.
This concludes today's conference call. Thank you for participating. You may now disconnect.