Ladies and gentlemen, thank you for standing by, and I would like to welcome you to the discussion on Text's Q4 2025-2026 KPI conference call. The call today will be hosted by Marcin Droba and Łucja Kaseja from the Investor Relations Department. At the end of the presentation, we'll have an opportunity to ask questions. Without further ado, I would now like to pass the line to Łucja. Please go ahead, ma'am.
Good afternoon, everyone. Thank you for joining our webinar. We will now present and discuss both our operational data for the past quarter and our outlook for the upcoming months, of course, this time in English. First of all, please take a moment to read the disclaimers, especially those regarding forward-looking statements. The entire presentation is already on the website. The recording and transcript of this meeting will be available on our website soon after the call, so you will definitely have a chance to review it. Getting straight to the point, as you already know from the current report published last week on Thursday. The MRR at the end of March stood at $6.93 million. This means that during the quarter, the Text group's MRR decreased by $50,000.
This is a smaller decline than in the previous two quarters, but of course, it is not a reason to be satisfied. What matters, however, is what lies behind it. First and foremost, January and February were quite stable, as we reported in our February quarterly statement, and the MRR drop occurred in March. That month, we introduced some changes to our customer acquisition process, specifically some experiments including redirecting leads from the [chat.com] website to the Text App. This initiative provides us with a lot of necessary data, but we are still losing some of these leads along the way, although we see improvement almost every day. In February and March, we also observed an increase in customer churn, primarily due to unpaid subscriptions.
We believe that, especially in March, this is an early reaction to the planned end of grandfathering for existing LiveChat customers, which we started communicating to them precisely since the beginning of March. This is a move that will significantly impact our KPIs, especially starting from April and into the following quarters. The picture of the past quarter looks much better when we look at our cash flow, which is reflected in the payments received data. Here we have a 0.4% year-over-year increase and a 3.1% increase compared to the previous three months. This is the highest quarterly value recorded in this financial year and the highest since Q2 of the 2024-2025 financial year. Differences in the dynamics between MRR and payments received usually stem mainly from the distribution of annual payments.
However, we are also in a situation where more revenue kind of leaks from our reported MRR. We are, of course, referring to payments received under post-pay-per-usage model. Here we see a significant increase, especially in payments for API usage. We reached a quarterly value of over a quarter of a million dollars, up from the previous three months by over 160%. On slide six, we can see the steady growth in the share of larger clients in our MRR. During this quarter, the share of customers with an ARPL over $500 increased by one percentage point. This is a favorable trend that should translate into better revenue retention over time, as this customer group stays with us longer and is more open to upselling. The next slide shows how the share of customers paying for more than one product from the Text portfolio is currently growing.
In Q4, they already accounted for 38.8% of our MRR, 10 percentage points more than a year ago, and 1.6 percentage points more than in the previous three months. We are always thrilled to share our customers' success stories. This time, it's a brand very well known in Poland, STS, which handles 500,000 chats annually and does it phenomenally. The video mentions a satisfaction score of 82%, but right after the filming, the team bragged that they had reached 85%. An excellent result made possible only with the best tools. You will find a link to the video in the presentation. STS uses four of our products: LiveChat, ChatBot, HelpDesk and KnowledgeBase. It is worth noting that our AI agents are doing great and constantly improving, achieving a resolution rate of 74% compared to the industry average of around 59%.
For a human agent, this metric is usually between 70%-75%, while other market players recently declared 60% as a success. Importantly, this average includes accounts that have not yet fully trained their AI agents on their own data. For customers who have completed the training phase, the results are even better, ranging between 80%-90%. For you to understand the metric, a chat is considered resolved if the user receives a complete answer to the reported issue, the user raises no further concerns, and the interaction ends with no unresolved follow-up questions. The most important product updates this quarter relate to the agentic AI area, and were rolled out in March. We enabled our customers to create multiple AI agents within a single workspace, and most importantly, we introduced custom skills feature.
Thanks to this, a user can describe in natural language what a given agent is supposed to do, and the AI will autonomously prepare the appropriate workflow, enabling the agent to execute specific tasks. Our work in the last quarter also involved many initiatives, often smaller projects that fit into a bigger picture. In our quarterly report, we mentioned, among other things, that our products are now available in the Microsoft marketplace, that we obtained Meta business partner status, and that we entered the marketplace of Kandji, a security app. In terms of security, we also partner with Hexnode, a device management and security company, and we are launched in their marketplace. Infrastructure changes have translated into increased reliability and quality. We've returned to actively encouraging our customers to leave us reviews and feedback, and the results are already visible in various rankings and listings.
This is very important also because it directly translates into credibility and visibility in AI models, where we see clear improvement. Of course, we still have a lot of work ahead of us in this area, and we will simply have to wait a bit to see the full effects of many of those actions. To sum up the quarterly picture, we recorded the best quarter in terms of payments received in this financial year. Unfortunately, we have an MRR decrease, though it's smaller than in the previous periods, and it reflects the fact that a small but rapidly growing part of our business is not captured in MRR. In this quarter, the MRR decline is, at least in part, the result of our deliberate actions, and as we mentioned them. You usually ask about new clients and the results of our sales department.
This quarter, we signed several significant renewals, some of which included upgrades. The biggest ones concerned our key accounts, where hundreds of agents work with our products. These are clients from industries such as biotechnology, Forex, and iGaming. These renewals and upsells were made possible by our SLC 2 Certification. If we look at the direct costs of obtaining the certificate, they have fully paid off. For now, it mostly helps us play defense, but we expect.
Ladies and gentlemen, please stand by.
I lost my connection. I'm back. Hopefully, you hear me well now.
Yes, yes, we do.
Okay. Thank you. Sorry for those problems. Coming back to the topic I was just discussing, the new clients. This quarter, we acquired new clients across multiple countries and industries, and our strongest sector were education, including top universities in Singapore and New Zealand, finance and insurance with new clients from the U.S., and sports betting. The last slide on my side. In the next three quarters, the biggest direct impact on our operational metrics will come from ending price grandfathering for LiveChat customers, as the new pricing for the existing customer base has been in effect since the beginning of the month. As you surely remember, at the end of September, we raised LiveChat prices for new customers. The price change varied across different plans, but on average, it was around 20%.
As we said three months ago, the new pricing was accepted by the market, and after a short dip, conversion rates returned to their previous levels. The end of grandfathering pricing for live chat will likely translate into some increase in churn in short term, but we estimate the net effect should be significantly positive for our recurring revenue. We assume the largest impact on MRR will be recorded in the current quarter. The price changes will not affect customers using the text product or those whose annual contracts expire after 2026. We assume 2027 will be the year of migration to text. We are continuing our work on SOC 2 Type 2 Certification, which will confirm that all implemented procedures are functioning as intended, and we are currently during the observation period. Starting tomorrow, the product operating under the working name Text App will officially become the Text solution.
The communication campaign associated with this brand is scheduled to begin in May. Please don't expect fireworks, by the way. There won't be a big bang at launch. It will be a phased, scalable process where budget decisions will be made based on data and results in specific channels. A major event related to this campaign will take place in the fall. We will certainly be much more active in PR. After a long break, we have someone on board responsible for this area, and we also want to start collaborating with industry influencers, among other things. The goal is to gradually and consistently build the strength and visibility of the Text brand. Realistically, the effects of this campaign will be visible in our KPIs by the end of the calendar year. This aligns with what we have been saying at our previous meetings.
This is not a sprint, it's the start of a marathon. In subsequent quarterly reports, we have emphasized that text.com will now be a significant acquisition channel in the coming months. Looking ahead to the next few quarters, the biggest impact will come from ending the LiveChat price grandfathering. Currently, a slightly stronger dollar is also working in our favor. We have also stabilized our infrastructure costs, which should actually be slightly lower in Q4 of the past financial year, the one that has just ended. Of course, we have to keep in mind that this is a dollar-denominated cost for us. Marketing and customer acquisition costs will grow, but budgets for individual channels will be closely tied to observed results. Thank you very much for your attention this time, and now we invite you to ask your questions.
Thank you. Thank you very much for the presentation, Łucja. We'll now be moving to the Q&A part of the call. If you're dialed by the telephone and would like to ask a voice question, please press star two. That's star two on your keypad. Alternatively, you may ask a voice or a text question via chat. We'll give a few seconds for any questions to come through. Okay. We have received a text question from Maksymilian Ratajczak from Family Office. Based on press coverage, it looks like competitors like Sierra and Fin AI are growing substantially. Can you talk about their target customers and whether they are taking away potential customers of yours, or if you're going after different customers?
Hi. Hello, Maksymilian. Marcin Droba here. Thank you for your questions. Thank you for being with us. Of course, I don't want to really comment on Sierra or Intercom or any of our competitors. Definitely, we had a very good quarter, as Łucja stated in the presentation, in terms of defense. Actually, we prolonged our very important deals. We kept important customers, who actually had their deals close to the end. Tap Tap Looking at Tap Tap at that was very good, very solid quarter. Of course, we are not growing. We are not as successful at this moment at the acquisition. That was not as great quarter in that terms. We will be, I think, looking at the future, looking at our plans when it comes to this PR, to this communication offensive, which will start in May.
At some point, we'll be more aggressive, when it comes to addressing the customers which are now using some competitors' solutions. We have some arguments, which should help us. One of these arguments can be great results of our AI agents we just presented. At some point, we'll be more aggressive when it comes to that kind of approach. Looking at the last quarter, I'm very convinced that we didn't lose any notable customers to our peers.
Okay. Thank you. Thank you very much. Another text question from Maksymilian. What are your main growth channels going to be for Text App, given that your previous CEO strategy will likely not work anymore given the decline of search traffic overall?
Sorry, Łucja, we usually switch when it comes to the answer, but I will try at least partially to answer that question, quoting our CEO, who actually stated on X, answering very similar question, that internet hasn't really changed in how growth works over the last 20 years. Only the platforms have shifted when the underlying mechanics stays the same. We have to basically repeat all the work we did over the last 20 years. We know how to do that. Actually, Tap Tap was also not a bad quarter when it comes to our visibility on AI models, so we definitely work on that. We will be much more active when it comes to, for example, to PR, also when it comes to cooperation with some influencer in the coming months. Basically, it's very similar work, but just in different space.
Also, I wouldn't agree with the statement that Tap Tap CEO is not working at all. It's still working, it still help us, but no, not at the scale we used to see. Tap Tap obviously very important change, and we witness many changes in the coming years, probably.
Yeah, we'll definitely be more active with our brand and, as I mentioned, we have a new PR person on board, so more of such activity will be visible. Also, similarly as in this presentation, we will be more sharing the examples of brands and how they work with our products, because this is something excellent that is being done, and some of the customers have excellent stories. It's just our role to pick them up and showcase. This type of activity will be definitely something that will be seen in the next couple of months.
Some things changing. For example, the PR, public relations wasn't so important for us, historically speaking. Media coverage, media publication are probably now more important as they are source of the knowledge, a source of reputation for the AI models. Some things changes, but basically the work is very similar.
Okay. Thank you. Thank you very much. Another question from Maksymilian. Can you share traction of Text App in terms of retention, usage, et cetera? Is it performing better than your legacy solutions? This seems the most crucial point, but you share very little information in your communications.
We have not given, as you correctly spotted, detailed information about Text App, especially what you have mentioned, retention or usage. This is because we have not run a large-scale conversion from the legacy products. We are getting customers each month in the Text App. However, these are not very large numbers, so we still do not have such history of data for those users.
Yes, of course, as Łucja said, we are aware that what we are seeing now, what is now happening in Text, is not one-to-one translatable. I don't know if that's the correct wording, translatable to that same solution to Text in the future, because there will be also some changes in Text. We just added crucial things in the area of AI agents, and we migrate to Text a very specific group of the customers of legacy products. All these KPIs are very important for us, but I think in the IR communication, it wouldn't be so valuable, to be honest, to really share too much information, because all these KPIs will be subject to the huge changes in the coming quarters.
Okay. Thank you. Thank you very much. Maybe just a reminder to the audience, if you would like to ask a voice question and you are connected via the telephone, please press star two on your phone keypad and wait for your name to be prompted. If you are dialing via the web, you can also request to ask a voice question or send your question as a text. I'll just give a moment or so for any additional questions to come in.
As you may know, we had Polish webinar. Before that webinar, we obviously had some more questions, but if I look at the whole picture, really, I don't think we share really important, substantial informations. I think all the important things we declare, we said, we shared today are already told. We were asked about dividend policy, is confirmed. We were asked about margins of the pay- per- usage payment. I think it's important to stress that if you look at the API revenues, that revenues, actually, we had cost related to that revenues before. We just started to monetize that subject. In the future, it will be very important. The most important part of pay- per- usage, pay- per- results model will be AI agents. That's the huge area. Definitely, we assume a very solid margins in that area.
We will learn the future, what market will accept, what competition landscape look like. We will observe how it work. When we think about how current pricing is working, we definitely assume that margins on that part of our business will be at least solid.
Okay. Thank you. Thank you very much. At this point in time, I'm seeing no further questions from the audience, so I'm just going to pass the line to the Investor Relations teams of Text, the line back to say their concluding remarks.
Well, we basically want to thank you for listening to our presentation. As you have seen, there is a lot of things that are happening. As we mentioned, small things are changing, but are part of a much bigger picture. There are some exciting things that will be in the future, but also, we constantly do day-to-day work for the numbers to be as they are. Thank you very much for your attention.
Thank you very much.
Thank you. We are now closing all the lines. Goodbye.