Welcome, everybody, to F-Secure's quarterly results session for Q4, as well as for the full year 2024, both online as well as here in the room. Our header this time around is "Solid End to the Year with Focus on Future Growth." Now, let's get moving with the presentation. As a matter of fact, let's not get moving with the presentation. I have to just inform everybody that you may not have noticed that we went out with a press release today that we are partnering with SoftBank in Japan, and this is the partner we announced anonymously in September. At that point in time, we were not able to disclose the name of our partner as they were starting the development of integration of our embedded security capability into their application. They launched on the 28 January, and now we were allowed to share the partnership.
I think we referred to a Tier 1 operator in Asia at the time, so that's Japan, and that's SoftBank, which is the third largest mobile operator in the country with over 25% market share. Now, let's get going. Our financial performance, I will leave the details over to Sari Somerkallio, our CFO, who will be giving an update after me. I will focus on overall events that we saw Q4. first of all, our Total application, which is the all-in-one app for consumer cybersecurity, did very well. We saw lots of take-up rate, and we actually beat our own internal target for converting customers from the individual applications into total. That went well. We also saw that our embedded security technology started gaining traction. We signed, for instance, two Tier 1 partners, one of them being SoftBank last year, into embedded security.
At the end of the year, we have 10 different components in our embedded security capability, which we believe is already the broadest offering in the market, and it will be going up to 20 in the next three quarters. We are developing that offering at breakneck speed. Our direct business, with the backdrop of having very limited marketing funds, especially for customer acquisition allocated to the business in 2024, did actually well. They did very well. Mostly thanks to higher average revenue per user, and towards the end of the year, the retention rate went up in a very nice way. All of this good development was offset by the same factors as what we've seen before. A few European players where their own market situation is relatively dire. They are not actively promoting security services, and they are suffering churn.
They've had relatively high penetration of security services, so unfortunately, that hits us hard. On the win front, we won two totally new logos in Q4, both in Asia, both mobile operators. In Asian countries, mobile operator customers have not traditionally been active in securing their services to the same level as we see, for instance, in Europe or in North America. This is a relatively new development that mobile operators in Asia are starting to adopt security services. We also made important and sizable service extensions and renewals globally at the end of the year. I would say that many of these, what they have in common is that the scope that we used to have with this partner has been now enhanced with Scam Protection.
Scam Protection is an extension to offering which may have been very often something like endpoint protection and VPN, for instance. We signed up a European operator group for Sense, with two first countries being in planning phase when and how they will be launching Sense for their customer base, and naturally then, hopefully, more to come soon after that. We signed a Western European CSP for DNS services. That's an existing customer who also enhanced the scope of their current services from F-Secure. As you may have noted, Q4, we ran a transformation process in F-Secure to align our operational model and our organization to our strategy and our growth ambitions and growth priorities. This was successfully conducted. The process ended in Finland called change negotiation process, ended in the first days of December.
Starting from the 1 January, we have the new operating model and new organization in place, and the savings targets were achieved. As mentioned several times, we will intend to invest these savings back into the growth initiatives that we're working on, both on the technology and product front, as well as on the sales and marketing front. This is a quick recap of what we talked about in our Investor Day in November, in case you missed it. We are now organized in a way on the partner business side that we have a specific business unit for engaging with strategic partners, which are the roughly 20 largest players in the world, the likes of Docomo, AT&T, and so forth, SoftBank. We have another one, which is looking at the next 100 big ones. We call them major partners.
And then our third unit is the very massive base of partners, which may run into thousands ultimately. These may be communication service providers, insurance, finance, payments, and so forth, into whose services security works well as an expansion. So we have these optimized teams now who are all equipped with the right level of skills, competencies, experiences, marketing efforts, product propositions, value propositions, so that we are, I dare say now, way more customer or partner-centric than what we were before when we had more of a regional organization to serve our partners. Also a recap from our Investor Day, just to make sure that we are on the same page with how we are developing our proposition. So at the top, if we start with that, we talk about the Attacker Kill Chain.
The kill chain means the steps that an attacker is taking to get access to a consumer's data and/or money. It has certain steps. What we intend to do is that at all of the different steps, we understand how the attackers are going about their attacks, and we want to prevent them from happening, protect people, and to recover if something bad should happen. We cover people from start to finish in this kill chain. We released just a short while ago in the last 10 days our new techniques, tactics, and methods description of attacker kill chain in the consumer world, so that if you want to find more about that, you can, for instance, find that release on our news section on the web, as well as on LinkedIn.
What we then achieve, naturally, and what we want to ultimately do is to protect people from scams. In the moment means that whatever you happen to be doing, if you're browsing the web, if you're banking, if you're shopping, if you're messaging, you see a small, small icon on your screen, that in this moment, you're being secured. And what you're doing is fine. The color of that little icon, we change either to amber or red, should be endeavoring to an area which is not good, so you will have the sense of security in the moment. We have now successfully become a part of the internet fabric, if you so wish, so that we can show people that they're in a good place.
Contextual means that, for instance, when you're traveling, when you're connected to unknown Wi-Fis, we let you know that now might be a good time to take extra measures. In terms of personalized, we're looking at an individual's behavior and adjusting the service based on that. And I would say that we're going from left to right in our focus of solving these topics. And finally, these are the kinds of channels or medium how attackers are getting to you. Browsing and messaging and social engineering and social media may be being the most typical ones. So we're also looking at specific technologies and research to help us understand how can we make sure that these channels are ones that we can, in a way, analyze and detect if something malicious is happening.
So if you want to get a feel for where our research is going to in all segments of this slide and our value proposition development as well. At the bottom, everything powered by AI. Just a quick overview. So we launched in June last year a new module into Total called Scam Protection. Now, I have to say I'm extremely proud to show on the left-hand side the level of capabilities we can already provide to users. There may be slight differences from platform to platform, so Windows and Android and iOS and Mac may be slightly different, but this is the list of things that we can provide, which is already very wide and just getting wider this year, perhaps even doubling in size of the kinds of things that we can do on the Scam Protection side.
So we've gone forward once again at a very fast pace. We think that we're precisely in the right place at the right time with Scam Protection. We launched the service in June. We now have the broadest embedded portfolio that has to do with Scam Protection capabilities in the industry. We won in the Finnish AI Gala. We won an award for the best AI-powered user experience development in our SMS messaging Scam Protection. And we now have 26 partners. At the end of the year, we had 26 partners out of our roughly 200 who have already committed to taking on the Scam Protection capability into their offering. So considering the speed at which our partners typically move, I'd say that this is the fastest I have ever seen them jump on a new offering. On the right, you can see why this is relevant.
Out of the roughly 8 billion people on Earth, one out of four have fallen victim to a scam during last year, and according to Global Anti-Scam Alliance, GASA, roughly $1 trillion lost to scams. That's 1,000 times a billion. It's a big number, that is. We are solving a big, big problem in the market that hurts consumers and businesses, and we're well-timed with the offering that we have. Now, just a recap of the change negotiations and the transformation we went through in Q4 . About 360 of our so-called fellows or employees globally were under this negotiation. In the end, we terminated 33 positions and 19 of those in Finland. That was slightly less than what we had indicated earlier, as we were successfully able to find new positions and roles in the organization and also discontinue certain external consultancies that we were using.
The EUR 4 million of targeted annual cost savings that we had set ourselves as a target was achieved, and now we're investing that back into supporting growth, both on technology, product, sales, and services maturity side. The one-off costs were roughly EUR 1.5 million, and these were IAC items that you can see in our financials. We got certain achievements. I already mentioned the one that is in the middle there, AI-based SMS protection winning the Customer Experience Award at the AI Gala in Finland. We also got a confirmation to what we've been doing for years. We've always been proud of our strong information security processes, practices, and skills in the company. Now we went through the certification with ISO 27001 to make sure that also they agree with us that we're in a good place.
And then Omdia, which is a research company belonging to the Informa Group, ranked us as a leader, as a cybersecurity provider and partner to telcos. I would call them CSPs, but they call them telcos. So they are especially complimentary of our comprehensive solution covering everything that is needed to secure both individuals as well as households. Finally, from the beginning Q4, we now have our new leadership team in place. The new persons who joined us are Bruno Rodriguez, who joined us as Chief Revenue Officer. Some of you may have seen him perform at our Investor Day. Kaisa Tikka-Mustonen, our new Chief People Officer, joined us in the beginning of September. And Nina Lehto joined us at the end of August. So that is now the team. I dare say we come from diverse backgrounds, many different countries, many different educational backgrounds.
I think that there is definitely rich diversity in the leadership team, which is a great benefit for us as we move forward on our growth path. That's all from me. Now I will hand over to our Chief Financial Officer, Sari Somerkallio.
Hello everybody. Let's look at the financials for Q4. As Timo already mentioned, overall the quarter was pretty flat. On currency neutral terms, almost 1% growth, which is, of course, when we started the year, we were expecting something higher. But it is what it is. Timo already mentioned a few of the drivers. What we are happy with, the total conversion has gone really well. And we are seeing growth there. And of course, that leads into ARPU growth, which we have talked quite a lot about earlier. And our direct business then grew. That's actually then outperforming our expectations.
We made the decision not to focus on marketing, but still we have seen growth this year. Although we can admit that during Q4, it was very much thanks to the good billings in the previous quarter that we see growth there. Looking at the geographies, so Nordics, that's where we've had great progress with Total. So very nice growth numbers, which are close to the level what we want to see. So 6.7% in currency neutral terms. Then the rest of Europe, that's where we have the challenges, which we have talked about already during previous quarters this year, and maybe good highlighting that it is normal that you have declining customers. Everybody's not always growing at the same pace, but these are such big customers that they are visible. So that's a reason behind the -6% in the rest of Europe.
By far the biggest reason explaining that number. Then North America, not as strong as it's been earlier this year, but some growth. And in the rest of the world, which is Japan and Asia in general, so there we see also good growth. And here you see also the split between Lookout and F-Secure. And probably you will not see the split anymore in Q1 because now the quarters start being comparable. The value of this fair valuation of deferred revenue, so that is getting very small. So it's not so important anymore. And also as we see growth in these synergy areas, so it becomes also difficult to say what is F-Secure and what is Lookout as it's the new F-Secure. But still here you see that. And so partner channel pretty flat and direct channel growing.
Then you see that the deferred revenue went up quite a lot since the end of the previous quarter. And that's basically our deferred revenue. There are some annual payments, there are some of these NREs and there's direct business. And in this case, we have some significant customers who pay once a year. And that's the reason why on the partner side the deferred revenue has increased so much, explaining that change. Then looking at the cost side, so here we had one round of change negotiations last year and achieved some savings. A lot of that was also at that time invested back to the company. But at that time, we made the decision not to put so much investment into marketing and direct channel. And that's the main reason explaining the decline in the cost. So other costs are pretty flat.
And here in this quarter in the area of our R&D, so we said already earlier that there will not be as much CapEx as earlier. So that's also visible in the numbers. So less CapEx because some projects were finished in the sort of September-October timeframe, which means that we had some, Timo mentioned, all the Scam Protection portfolio that we have developed. So in that area, things were finalized. And thus more of our work going into normal operations. And maybe still about that, so we are not here talking about the TSAs. There is one contract that we still have, but that's already of a very commercial nature, even though officially called TSA. So we are not focusing on that anymore, and we will not talk about TSAs in 2025 reporting anymore. Then looking at gross margin and the adjusted EBITDA.
So gross margin, it is lower than the corresponding quarter last year. And that's the same reasons that we have talked about. It's the changes in the product mix and also lost synergies as we got our independence from WithSecure. But that's old news already from Q1. But you see a tiny reflection there as it's been improving during the year. So that's the efficiency we have gained. Then here maybe already commenting things that we have mentioned in the outlook for 2025. So how this will develop is very much a question of the product mix. And the more we sell embedded products or services, so it will have a negative impact. And we expect to sell more embedded services. And then on the EBITDA side, so of course big drop from Q3, which was excellent and which always is the most profitable quarter.
But if we compare to Q4 last year, so the profitability is pretty much on the same level. And it's a combination of the lower gross margin last year, but also lower costs giving the same outcome. Then just quickly looking at the full year. So just recapping that the revenue growth of 12% during the year. So that's of course a result of the Lookout Life acquisition in 2023. It was in there only for seven months. And so that's the additional five months. And there may be good highlighting when looking at the geographies. So you see the big growth in North America and rest of the world. And that's the Lookout Life impact. So that was big in North America and Japan. But Japan has also otherwise had a good year. And then the Nordic countries. So that's totally organic good development.
And then, on the EBITDA side, so that's of course the addition of the five months. So, of course, Lookout Life was a profitable business and brought us some extra profits for this year. Then, looking at the cash conversion. So, in Q4, cash conversion on a nice level of 99%. So, basically, all the profit turned into cash. That is reflecting the lower number in Q3. So, a recovery from that level. But, overall, a very good number. And, about cash flow, also reminding that we have repayments of our loan twice a year. So, we paid EUR 15 million in Q4. And there was also the second installment of the dividend. We had EUR 8 million of our RCF in use at year-end and will be paid back during Q1 gradually. And, looking at these balance sheet-based and cash flow-based KPIs, leverage not much changed since previous quarter.
And that's a dividend payment that is mainly explaining that equity ratio is improving nicely. Of course we are on low level because of the fully debt-financed acquisition, but going in the right direction. And then the dividend proposal. I'm sure you remember we changed our dividend policy during Q4. So it used to be around or about 50% of net profit. And that's the main thinking still. But acknowledging that we are paying off the big loan that we have at quite a fast pace. So we have this possibility to pay less as long as we are lower than our leverage target of 2.5. So we have used that possibility. And now the EUR 0.04, which will be again paid into installments. So it's 33% of the EPS.
And if we look at this, not going to read through again, the financial targets that we renewed were also this dividend yield was. But maybe highlighting here the blue text on the top. 2025 is still a ramp-up year. Even if we are aiming at the high single-digit growth and EBITDA being in the 40% ballpark when we are big enough, we are still not there, but this is the ramp-up year. We have already launched new services with new important customers. But as they start from sort of zero, it will take some time to ramp up and also offset some of these declines that are still continuing. For 2025, we expect mid-single-digit revenue growth. Clearly higher than it was in 2024, but not on the level which we see that is possible. This is maybe the market growth rate.
But as we have said, so we believe that we have lots of opportunities beyond that through our offering and also through the Tier 1 pipeline that we have. And then in terms of profitability, we expect the adjusted EBITDA to be on the same level as in 2024 in euro terms. And of course that in sort of percentage terms, it is lower than in 2024. And that's because we have increased our cost base and we are still working to ensure that we have all processes in place and we are prepared for serving the Tier 1 customers. And of course the growth in all other segments as well. But the cost is basically in place. And now we need to work on the growth part. So in the future, cost should not grow with the same pace as top line, but it will change.
But this is the situation currently. In terms of direct business, so no high expectations there. Of course we still want to focus on the retention rate and have that as high as possible. But no investments into new customer acquisition. But of course we are doing still some organic things, but not paid acquisition. Gross margin will reflect the product mix, but we expect it to be lower than this year. And the CapEx level, so we can see that Q4 was lower than we expect. Maybe the other quarters might be in 2024, maybe were higher, but overall similar level. And that can be impacted by product development type of CapEx. So if we have big projects for building new services, so then numbers can be higher. So of course it is a reflection of what we do in terms of activity.
And a reminder, so the full annual report will be available at the end of February. And the annual general meeting is 1 April. And the interim report will be then at a sort of familiar timing end of April. So that was our presentation. And now we are with Timo, happy to answer your questions.
Hi, it's Atte Riikola from Inderes. Maybe first about the outlook and first thing about the direct business, you're expecting the revenue to decline. So can you say anything more about that? Is it going to be like low single digit or do you see some heavy decline on that front?
I think the sort of strategy that we have is similar to what we've been doing this year. So no, we don't expect like dramatic fall. But this year was better than we expected.
And we are continuing to work in the same way. But expectations are not high. We don't want to sort of push that one.
All right, then about the partner channel. Should we expect that most of the growth is coming from those Tier 1 ramp-ups or is there some growth coming from, you mentioned that total conversions have progressed well. But is it offset by those declining partners still?
I could comment on this one. So I would say that, I mean, in revenue terms, most likely relatively similar amounts that we will see from the Tier 1 partnerships growing as well as total partnerships expanding. And Scam Protection is the, in a way, the trigger for expanding the value with the total partnership. So I think those should be relatively similar in size.
Do you still expect those same partners to decline that we have seen in the past few quarters?
Yeah, there are still some significant declining partners.
About the gross margin impact when you get those Tier 1 growth going on. I think you haven't mentioned the gross margin levels, but we know that the Tier 1 gross margins are lower on the embedded security part. Can you say anything about that? How much do you expect the gross margin to decline this year?
Yeah, that is a tough one because it totally depends on the product mix and how fast these Tier 1 embedded cases, how fast they grow. But as there is nothing that goes with rocket speed in our business, it should not be dramatic. More of a trend type of thing.
I would say that that also varies from partner to partner.
We are also channeling in certain third-party services into our embedded security portfolio where we are then exposing the SDK and the APIs to the partners. So we may have royalty costs. So depending on the service scope that a certain partner wants, it may be very highly F-Secure IPR or they may be also relatively valuable external components coming in. So that's also a variable that we don't necessarily know before we see that precise case. But like Sari said, no dramatic change is expected.
Maybe a little bit building on that. So within our total business, it is fairly stable what the gross margin is. But then on the embedded cases, so it is more customer specific. There is no like embedded normal gross margin, but it depends on what we are selling to that actual partner.
Now when those first Tier 1s are launching their services, so do you have or what kind of visibility do you have to the ramp-up of those?
Good visibility.
It is monthly invoicing.
All right.
Something that maybe wasn't verbally communicated, but was, I believe, in our release, was that we finished two massive Tier 1 delivery projects in December. That was a big, big effort that took place all during 2024. One was for the partner that we launched in March, still anonymous, hopefully one day not. The other one was a major upgrade to the service that AT&T is offering. Those are naturally. AT&T is something that we're working with all the time and have been working. The other one is starting from scratch and then ramping up. We do know how those develop very well.
All right, thank you.
Good afternoon, it's Matti Riikonen, Carnegie. A couple of questions and I'll start with the kind of negative things. The few European players that you have been or who have lost their subscribers and therefore limiting your top line, has there been a change? Are there more players or are you still talking about the same players that are leaking at the moment?
Same players.
Yeah. And when was it that you started to realize that they are actually leaking or has this been a longer trend and now intensified?
About 18 months.
Right.
So it's been going on for longer than we have said it in the report. But now I think it was, was it after Q1 or Q2 that we wrote it first time was that because we saw that it continues and probably will go on still for some time.
Actually, what I forgot to mention in the presentation, Poland that we have mentioned as a problem. So now we've seen a flat, I think Q3 was almost flat and this was flat. So there we believe that we've seen the bottom. And it was a little bit different case compared to this Germany and U.K. that we have mentioned.
Right. So has this leakage of your revenue accelerated during these 18 months that you mentioned?
I think it has. At least it's been higher than we planned internally.
At least in 2024 it was slightly higher than what we had expected.
Right. So the reason for asking is that if we think that all leakages basically have a 12-month impact on your growth, because if it's a certain number which is then depreciated of all quarters after the customer has left, it's the 12 months.
But now, if the problem is more dynamic so that the customers keep on losing subs, then of course we don't know what the end game will be until you start to see that there's a stabilization. And then after that, we should be expecting that it will be over in the next maybe 12 months.
Now we've been prudent and we've been planning on a declining trend when we have been planning our 2025 revenue projections.
Right.
Of course we are trying to engage with the customers, but they have other problems. It's not sort of only us, but of course we are trying to tell them how we could help them. But if they don't have funds to market, for example, so it's not easy to sell more of our products, even if they know that our products are profitable for them.
And if they are working on potentially upscaling their fiber service or customer management systems and so forth, it's very difficult to get to the top of the agenda in that kind of situation.
Sure. Is it possible to quantify the impact on your growth, how much you are kind of losing from these particular few European players? Just to put into perspective how much that actually is in your equation.
Yeah. I think we can say that during 2024 the impact was millions.
Right. Okay. All right, thanks for that.
And then about the revenue guidance, when you say that kind of your growth would be accelerating towards during 2025 as you ramp up new customers, that basically I suppose means that if you start with the current run rate, which is roughly 1% maybe top line growth, to achieve mid single digit, let's say it's five, then you would be approaching 10% towards the end of the year to get to the broadband.
That's the logic that you can say that average is five and something less in the beginning and something more in the end.
Yeah. And that basically.
That's what we are trying to say.
Yes. So that basically includes also the churn.
Yeah. Of course we have taken that into account in our plans.
Okay.
So basically, if we look at the gross margins, which should be declining due to the sales mix, it's quite funny that if you're doing well and you are growing fast on the embedded side, it would seem that the result would be lower gross margin, but then slightly better.
Yeah, more euros anyway.
More euros.
Okay.
And that's the game. That's why you accept the lower profitability because it's more euros.
Sure. All right. I have nothing further. Thanks.
Thanks, Matti.
Hi, Waltteri Rossi from Danske Bank. Thanks for the presentation. About the SoftBank partnership, did they have their, so to speak, own solution before and they switched to you or not? And what different capabilities does your embedded solution include there?
Yeah. So they did have an app before us developed by a SoftBank group company, BBSS.
They decided to enhance the functionality of that application with identity monitoring, which comes from us.
So it is a very limited scope that we have with them.
To begin with, yes.
Okay. But it's still Tier 1 in your books. So the potential is up to starting from eight million.
Absolutely. They have 25% of the mobile market in Japan. It's a very big market. SoftBank is a major player. They also have other assets than mobile operations. So we see that it holds actually a lot of potential. Because, as Sari says, this is also only a relatively limited entry into the account, we are naturally looking forward to expanding our role and position within the account.
All right, thanks. Then on the partners that are leaking, did you lose those accounts completely or can you open that up a bit? Yeah.
Did you lose the accounts to another provider?
No.
We are losing together with them. As they are losing, so our services go with that. No changes to the contract.
[you didn't] ask this, Waltteri, but I don't think we lost a single partner last year. I have to really dig deep to even think that did we lose any bid fights against competition. So we did well. But our partners do move relatively slowly and they take their time in A, making up their mind, B, making a contract with us, and C, then actually launching the service. So this is a business requiring quite a lot of patience.
Okay, thank you. Then you had this comment on the report that you are refraining from paid customer acquisition in direct channel.
To me, it almost sounds that you are not going forward trying to even grow the direct business.
We are. We are focusing on organic growth. We have three things that we're focusing on. One is continuing to increase the average revenue per user, which went very well in 2024. Secondly, we're improving our retention rate, which has started to show very promising signs in the last months. Then thirdly, we want to turn our subscriber count into growth in 2025 through organic measures. There are lots of organic measures that we can take. That's what the team is working on right now.
As said in the outlook, we are expecting decline because still the retention is higher than what we get new customers.
But it is a profit optimization mode and this is what we've seen is the best thing right now, best use of our funds. And very similar to last year.
In the beginning of last year, let's say for the first couple of quarters easily, the previous year's marketing efforts were still bearing fruit. So that the effect was not as, let's say, sharp.
Okay, thank you. Then on the growth, sorry, on the guidance. If we look at the Q4 numbers, they don't really seem to show any clear turning point in the underlying market yet. So what kind of gives you the confidence on the 5% target this year? Is it based mainly on the new partnerships and then total upgrades, obviously? But if you can kind of, yeah, explain what gives you the confidence.
Yeah.
What gives us the confidence is what we know about the plans of our partners mostly. Like we already referred to direct business, that's not the primary focus with regards to growth, naturally holding the fort. But with regards to partner business, one is new wins on the strategic partner side or Tier 1 partners. Secondly, driving the success of the partner services together with them that have been launched and delivered. And thirdly, to win completely new partner accounts. And I have mentioned a few times that we have a good pipeline and that we have.
And I think if you look at that geographic split that we have shown, you see very nice totally organic growth in Nordic countries. And also in the U.S., we've shown positive numbers. Japan has been very good that it is this rest of Europe that has been the problem.
We hope that this leakage would at least not accelerate. Yeah, we expect the leakage to continue, but the other things to more than offset for that.
Okay, still a follow-up on that. You said that the guidance kind of expects also new partner wins, but shouldn't that impact on this year's sales be quite limited?
It does affect this year's sales, why we have roughly 5% expectation on revenue growth.
Some of those launches were end of last year. Starting from small numbers, but growing during this year. That's why we believe that the latter part of the year should be stronger than the first.
What I meant was if we win new partners this year, did I understand correctly? That you expect some new wins also during this year to impact this year's sales already.
We do.
Yeah.
It is of course then case-specific how big the impact is. And if we win something during first half, so it can have an impact on the second half. And then if there are big cases where we would get some of that NRE, so that would also, even though it's always recognized over a longer period, so it will also be still having a positive impact.
All right, thank you. One last technical question about the loan repayment. Do you still expect to pay back the loan EUR 30 million a year this year? And what about next year?
Yeah, that's the phase we have in the contract.
Okay. That's all. Thank you.
Thank you. Still a couple of questions from the online audience. What is the Scam Protection impact on typical or average customer ARPU?
When you are expecting Scam Protection revenue to become relevant in the group numbers?
I expect that during the course of 2025, it's already relevant. The kind of effect on ARPU, if I think of our average, when we cut across all of our partner business, for instance, it might be anywhere in the region of 10%-20% increase in terms of ARPU, but that's a very rough estimate.
It depends on what the partner has in the previous offering.
But across the whole base, maybe 10%-20% is something that we can expect in direct business. Our Scam Protection offering will be launched this year as a separate module, only taking Scam Protection, and that pricing is not yet defined. So that we don't know quite yet how much that will increase the ARPU.
Thank you. Then second question regarding profit distribution.
Is it possible that F-Secure is considering opportunistic share buybacks as part of its profit distribution?
Of course, it's possible to consider, but as we are now repaying our debt, so it doesn't sound like a clever solution. We also cut the dividend, so why would we use the liquidity to buy back?
Thank you.
So we do prefer to pay off the debt fast.
Good. Thank you. That was all from the online audience at the moment. Maybe still from the audience here.
Hi, Matti Riikonen. Still two questions. The first is that if we think about your top-line growth on a quarterly basis in 2025, would it be possible that it goes negative in Q1 if you still have these kind of accelerating leaking customers? And then if you stopped marketing on the direct side, it could still have a fairly negative impact.
You still don't necessarily have that much on the kind of growing customers from the prior deals. Is it possible that it could be even negative?
If I start with the direct business, it's only 19% of the business. The impact, because the revenue recognition is longer, so it's still the previous year billings that have an impact. So there's nothing that happens fast. Now it was actually positive in this quarter. Of course, anything is possible, but I think that we have clearly planned so that I think we would be extremely disappointed if it was negative and at least not in my books.
Yeah, it's not something that we're expecting or seeing.
All right, thanks. Then about, could you describe the Sense opportunities a bit more in detail? Now you mentioned that you won one deal.
When at the CMD you talked about the new kind of agreement of making it kind of like a standard version. What can happen in 2025 still on that front? Do you have kind of many discussions ongoing?
My expectation with regards to Sense is that the best thing we could see is that we sign a good number of deals, either directly with communication service providers or through our many partners that we have. We have roughly a dozen partners, including the likes of Nokia, providing our capability to their customers, the ones who are providing routers. To sign a good number of deals in terms of revenue, I'm not expecting a lot of development in 2025. That would be seen in 2026.
So if I were in your shoes, I would be looking at the number of new deals during the course of 2025 as an indication of what can happen in 2026 and 2027.
Right. All right. Good. That was all from me.
Thank you. Apparently, no other questions from the room. So thanks everybody for the good questions, both here and online. Hope to see you again potentially at our AGM as a shareholder or maybe at our quarterly result for quarter one in April. Thanks for joining. Have a great day.
Thank you. Bye-bye.