Good morning, everyone. Thank you for joining us to kick off the first session at the Morgan Stanley TMT Conference. My name is Elizabeth Porter. I'm an analyst on the U.S. Software Equity Research team, and I'm really excited to have with us today GoDaddy CEO Aman Bhutani and CFO Mark McCaffrey.
Thanks.
We are going to have Q&A at the end, so Mike will go around. Before we get started, for important disclosures, please see the Morgan Stanley Research Disclosure website at www.morganstanley.com/researchdisclosures. With that, Aman and Mark, thank you so much for joining us today.
Great to be here. Yeah, thanks for having us.
So just to start off, one of the key advantages of GoDaddy is your diverse customer base of 21 million customers, and that really provides a resiliency for the business throughout economic volatility. So just given your very unique lens into the SMB landscape, I think it'd be great to start off with just what you're seeing from the health of your own customer base and how the macro outlook may change as we go into 2025.
Yes. So I think, as most folks are aware, GoDaddy's customer is the microbusiness sort of edging into the small business. And these folks are a resilient group, right? They've got to make things happen. And if you survey them, they're always more optimistic about their future than other things. And that has continued. They continue to be very optimistic about their future. What you do hear a little bit more of is the three things that they're just worried about. They're worried about access to capital. They're worried about hiring people at the right cost to help them with their business. And they're worried about being able to procure whatever they have to procure. So the broader macro conversation right now does impact that. So you do hear it a bit more.
What we're not seeing, though, is that we're not seeing that sort of show up in either traffic to the website or in renewal rates, right? We have a large enough base, like Elizabeth said, where we're quite representative, and we continue to see the healthy renewal rates that we expect, which one would expect that if they were really worried about it, there would be sort of less people coming in or hesitation in renewals, but we don't see any of that.
And it continues to be a very passionate group of entrepreneurs out there. We monitor a lot of different metrics to kind of see what the overall impact is and try to tie it back to the funnel. And what we're seeing is that continuing stable funnel with that customer coming in, attaching faster, higher AOS at the initiation. We've seen the strong retention rates. And we're getting to that customer who really wants to do something with the domain name, with the website, entering into the commerce products. So again, it's something to continue to monitor. But right now, customers are coming to us because they need our products. They want to do better. They want to reach more customers. And they're staying with us because we are still at a very, very good price point for them to run a business.
Great. And you recently reported earnings. And a question that came up multiple times with investors was around the capital allocation strategy. You guys outpaced your initial targets, but investors looked at the moderating pace of buybacks of the last two quarters and wanted to ask if there was any change. And Mark, I think you were very clear in saying, look, there was no change. And actually, in fact, you guys entered into an accelerated repurchase agreement on February 17 for $330 million to be completed at the end of Q2. So how should investors read into this moderating and then accelerating pace of repurchases? And given your position as just disciplined, long-term holders of your own stock, is the company just being valuation sensitive?
Yeah. So it's a great question. And I'll start with absolutely no change to our capital allocation policy. We continue to be disciplined on how we approach it. We look at the program that we initiated in 2022, and we've had great success with it. Even if you take it to last year, we bought 5.2 million shares back at $129, which we again evaluate every quarter what's going on in the world, what makes sense for us. We have the luxury of having a lot of free cash flow that allows us to be opportunistic when we see the certain data points that we can take advantage of. And we continue to do that. Again, it is a big lever, and it's a big method for us to return value to our shareholders.
We haven't changed on our approach related to it, but we continually look at it from quarter to quarter and say, OK, what makes sense right now? What are we going to do? We have a very engaged board around it, and it continues to be an item that him and I discuss all the time. But there has been no change to how we approach it. We are disciplined in our capital allocation.
Maybe I can add. We continue to also invest in the business for the long-term return for our shareholders. We've done very well doing that, too. We continue to be very disciplined with our cost structure. We continue to be very disciplined in our marketing. For example, we are spending more in marketing right now with Airo. But our guardrails and our measurement and our discipline that we've talked about over the last three, four years has not changed. We're still looking at things through the same lens of discipline, right? Investing in the business is important too. On the M&A side, we've continued to maintain that high bar. We've maintained that on M&A, we will look at assets because we have the opportunity. We have the brand. We have the position. We have the capabilities. But it has to be strategic.
It has to financially make sense. And it has to be something that we can integrate because we are much more of a platform business now. And platforms create value through the integration and not by holding assets separate. So that means our bar is pretty high over there. And it's been high. And I think we've maintained that pretty clearly.
Great. And just shifting back to some of the fundamentals of the business, at your investor day, which was about a year ago exactly, you laid out some key focus initiatives for the year. So just looking back, can you help us set the stage of where you've had the most success on those initiatives? What were some of the inflection points you saw over the year and how those are forming your go-forward strategy?
Yeah. I can start, and Mark, if you want to jump in too. We had talked about four initiatives that would be multi-year initiatives that would be big contributors to our financial metrics. And those were commerce, which is our foray into payments, and now a broader SaaS offering in commerce. And we've continued to launch more products there. And we've grown well and sort of ahead of our expectations there. It was seamless experience, which is really about taking out friction within our products, in our purchase paths, in our renewals. Basically, everywhere we look, how can we make things better, better, better all the time? And given our scale, small changes there lead to great returns, right? The third is pricing and bundling, which is an initiative that is a multi-year initiative for us and did much better than I expected.
Actually, seamless experience also beat our expectations in 2024, and then cost optimization continues to be an area of focus for us. And it had been a focus in previous years as well. In 2024, all four of those initiatives did very well. Also, Airo did very well, right? We had put Airo out as an initiative, and we said, this is not in the financials. We see this as a longer-term play. But Airo came in really strong. It's an infant today. It's like one year old. And we already have millions of customers that have discovered Airo. About half of them engage with Airo. That means that they use some product that's given to them as part of Airo. And now we're sort of accelerating some of the monetization phase. Of course, the monetization phase is small, and we're very focused still on discovery and engagement.
We want every person to know GoDaddy Airo. We want every person to engage with it. We want every person to start with GoDaddy at a different place. We don't want them to start with domains and for us to have to add all these products later. We want them to just start at a higher level with us, with awareness of our other products. And Airo has done that very well as well. I don't know, Mark, if you want to.
Yeah. I'll start with when we laid out the plan last year. And again, apologies for the conflict. We own that on our investor day last year. And now we're a year into it. And we're on target or ahead on every single metric we put out there. I would say an overall statement is I don't think I've ever been as excited as I am now looking out at the prospect of what Airo is doing, how customers are engaging, how they're responding to it. It is really exciting to see the plan start to unfold. And we're doing it in a manner that we're looking at the long term. And we know that this is working. We know the customer behaviors. We can play into making sure that we're getting the right customers into the funnel. We're getting that customer with the intent that we always talked about.
They want to do business. Sometimes they want to do multiple businesses. We do laugh because sometimes it's the husband doing one business and the wife doing another business, but they're both doing businesses out there under different names. And when you see you're providing that benefit to the customers and that seamless experience, you're providing the bundles that continue to engage in, it's really remarkable. We focus on products a lot, but at the end of the day, our customers are getting benefit from what we're doing. And that is really exciting for us. That is really something that we look out and say, wow, this is working. This is doing exactly what we wanted to do, and in some cases, doing it better.
Right. And Aman, I want to go back to some of your comments around Airo and the strategy there being first discovery, then engagement, then monetization. And so starting with just the engagement and discovery piece, can you just put a finer point on how Airo is actually just shifting or broadening the starting point at which customers are launching with GoDaddy?
Yeah. I love talking about Airo, actually. But the way most customers, new customers, discover Airo is that they buy a domain name, and they're not really thinking about Airo at all. And then suddenly, Airo appears as they complete the purchase. And Airo says, hey, I could build you a one-page website. I can connect this domain to email. All you have to do is click a button. No config needed. I can help you with some marketing tools if you want. I've already built you a logo and an email template. And whatever you change, if you change the logo, I'll put it everywhere. I'll put it on the one-page website. I'll put it in your email. So everything's connected, right? That's the first exposure customers have to Airo. And about half the customers that buy a domain end up using something in Airo.
That's what we mean by saying customers start with us at a different place. When they start with us on domains, we actually have to work harder to sell the website because we have to start with awareness. They have to know that GoDaddy has a website product, right? And given our broad brand awareness around domains for many, many years, it's worked to continue to shift that awareness. But with Airo, if you buy the domain and you have a one-page website, already you're thinking as a customer that GoDaddy has website tools. I can see it. I can use it right here. I can change the tagline. I can do a couple of different things, right? One of the things we added to the one-page website is a little form where our customer's customer can send them a message.
When the customer looks at that, they say, oh, if my customer sends me a message or anybody just sends me a message, where am I going to see it? Oh, GoDaddy has a conversation app. Oh, in this app, if I get a Facebook message or I get an email, everything comes right here. Oh, I like that. Let me download that. Let me take a look. So Airo is a vehicle to have customers start with us with multiple products, to expose them to the breadth of GoDaddy products so that we can sort of truly realize that vision of one-stop shop in their minds first and get them to discover it, engage it, and then get them to monetization on it.
Great. And you referenced a lot of the touch, particularly around email. And I think it was about 50% of Websites + Marketing subscriptions originated with Airo in Q4, which was up from about 40% in Q3. I think one of the things I often get asked by investors is, look, I look at the subscription revenue growth within A&C, and that's remained fairly steady. It was about 8.7% growth in fiscal 2024 versus 8.2% in fiscal 2023. So just given all the goodness around these attach rates, is there anything that would be holding back that metric, or should we just start to see it inflect higher as it rolls through?
Yeah. So the way we've done it is that we've shifted where customers start with us and get them to start with Airo, and they start with a website, maybe a one-page website, and then go to a full website. So all that, of course, that 50% is not incremental traffic coming to us. But because they're starting at a different place, they're not only starting with a website. They've got a logo. They've got some email work with us, too. And that we see as value delivered to the customer that we haven't charged for yet. And that is the fundamental optimization function for the pricing and bundling program. What the pricing and bundling program does is that it looks at a set of attributes. They can be customer attributes, product attributes, user attributes, a number of things.
We have over 1.5 billion attributes that get captured on our platform every day, right? The pricing and bundling technology looks at that value that the customer is getting, compares that to the price, and says, hey, here's a way to give even more value to the customer and take more price, right? What we're doing with Airo today, the reason it's not about inflecting the monetization or the revenue immediately is because we're adding more value to the customer, which then creates this tailwind of being able to take monetization in the future, which is what makes pricing and bundling a multi-year initiative, right?
You continually try to add more value and then take price or what we call value-based offer, where you're truly looking at the value the customer is getting and then take part of that value for the company, but while at the same time optimizing for not increasing churn rates too much. So that's the, if you will, that's the objective function that we're trying to optimize for at the company.
Yeah. And I'll just add, this works within our model. We're looking at the long term, which means you have to engage the customer. You have to get them renewing. You have to get the renewal rates up, right? And over time, we're a big company. That starts to flow through and incrementally increase our ability to get better at what we do. Better every day is one of our mottos. And where it really shows up is our free cash flow. And we always say our North Star is our free cash flow. Our ability to optimize on our long-term model is really geared towards optimizing on the free cash flow over time, which gets us to put out those markers that we always talk about. It works because our customers get value. We get value from our customers.
Our customers, whether they're coming in initially on bookings or renewing on bookings, that is our cash flow. We get the cash upfront. So that compounding effect really is the marker we use to say, hey, this is working over the long term.
Great. One of the areas that you have started to push that monetization a little bit faster on Airo is with your Airo Plus SKU.
That's right.
I know it's still some of the early days, but could you just outline, I guess, first, the customer metrics and behavior that drove your confidence to kind of move that into the monetization stage? And then just more broadly, what you're seeing from customers for their demand and Airo Plus as like an independent SKU?
Yeah. So it's a systematic, almost you can say, an engineering approach to sort of investing into new experiences for the customer. So when the customer buys a domain, we show them eight, nine cards. One of those cards is a logo. Do you want a free logo? It's already built. It's not a very fancy logo, but it's a good logo that most customers would be happy with. If we get engagement with that card, we start to optimize that card to see, hey, customers are interested in it. Should we do more with it? We start to get that engagement with logo that then unlocked the idea for us that we should build a paid version of this logo, which is a really amazing logo, something that it would take a professional a long time to create.
We built that product, and we started to test that product. Then we put it behind the Airo Plus paywall. We said, $5 a month, you can get not just this logo creator, but a set of features, other features too. All you have to do is pay $5 a month for it. We started to test that merchandising. When we started to see engagement on that merchandising, we're like, OK, this is pretty interesting. Now let's build a full on-ramp for logo. If you now go to GoDaddy, you'll actually see there's a landing page for logo, and there's a path that starts to come in. It's just started. The entire Airo Plus SKU is launched in January. We're very, very early on it.
But that's the sort of systematic approach where we're looking for the proof points to continue to dig more into the veins, which are the best veins, where we can get the customer engagement. Customers are ready to discover it. And then obviously, that follows with monetization.
How should investors start to think about what's the addressable market for Airo Plus? Is it any of your 21 million customers could start to attach this product? Should we think of it more as the customers that are buying the websites? Just help us frame kind of where that opportunity fits in.
Yeah. It's very, very hard to say. I don't think we know, and I don't think anybody else knows. I think it's a little bit easy to say, oh, maybe it's your current customer base. But one of the Airo Plus products is called Site Optimizer. That's an AI product that looks at any website, and it tells our customers how they can improve that website, right? If that website is on our end, for example, if that website is hosted with us on Managed WordPress, the Airo Optimizer will actually make the changes for the customer as well, right? We could see that go across the partners. That doesn't have to be limited to our customer base, for example. So what we're really doing is we're looking for these points where customers show interest, then we optimize the product, make it very scalable, get that product out to market.
And then we already know that there are large segments of customers that we have already and potentially other folks as well that we can target with these products. And we're putting the sort of money and the energy and, frankly, the pixel space on our sites behind the products that have the best click-through.
Yeah, and we always look at it. There are two opportunities we have whenever we're doing. We did it with email. We did it with commerce. Now we're doing it with Airo. There is the new customer coming in and engaging that customer to make sure that they see the value, they see the seamless experience, but with over 20 million customers, we have the ability to go into our existing customer base, and that is a different but available muscle to us that we see as we engage them at where they need to be engaged. It creates that dual opportunity for us and gets us to what I always call the durable, predictable model that allows us to, as you opened up with, even in slower times, be able to engage our customers and see value.
Great. And I want to dig back into the pricing and bundling strategy you talked about earlier. You had a lot of success here, particularly within productivity with A&C in 2024. So how are you going to expand the success with pricing and bundling into other areas of the business?
Yeah. So pricing and bundling, like I said, is an approach that looks at what value customers are getting. What else can I bundle into that value given the customer attributes or engagement attributes I'm seeing? And now how should we create a value-based offer for that particular customer, right? This is not cost-plus pricing. It's not a blunt force type of thing. There's literally an objective function that machine learning models optimize that tries to grow bookings as much as possible while minimizing any increase in churn, ideally keeping churn as flat as possible. So that's the objective function. Pricing and bundling is sort of addressing. We started with productivity because it was a large base of customers. And through our testing, productivity customers reacted the best to that tool set.
But what we learned through that process, and we've talked about this last year already, what we learned through the process is that we should be approaching it from the customer lens rather than the product lens, that we should look at customer cohorts where the technology should be applied to. And that's what we're doing now. You're seeing in 2024, of course, pricing and bundling contributed a meaningful amount ahead of our expectations. We're planning a meaningful contribution from pricing and bundling for 2025 as well. But the approach we're taking is that we're looking at customer cohorts that have our presence products. So those can be presence products and applications in commerce or in core because we have hosting in core. And those customers also have some level of presence. We're looking at customers that have those cohorts and applying pricing and bundling initiative against them.
If it was just about pricing or existing bundles, that would, I think, make it a relatively limited program. But what we have at GoDaddy is we have a big breadth of products. A lot of our products our customers are not fully aware of. But we also have the ability to do great partnerships and now put them on our platform, which gives us this expansion lever where the pricing and bundling, especially the bundling part of it, can introduce a new experience or product to the customer, hence pushing the value up even more, allowing us to take even more price over time. It's not all going to happen in one year. But as you move the value, you can move the price every year. Hopefully, that's helpful.
No, it is. And so it sounds like there could be a bigger opportunity beyond just kind of what you saw in productivity because you have a much broader portfolio of products that you can optimize for different customer segments.
Over time, we absolutely expect that to be true. I think it's given the approach because it's a machine learning-based approach, and it's an experimentation-based approach. It's hard to have a pinpoint. You have a range of outcomes that the models give you, but it's hard to pinpoint a specific thing. But when you add time to it, we absolutely expect to be able to do more than what we did just last year.
Got it.
It's helpful. We have the data across the consolidated technology stack from the domain all the way to the transaction, which really allows us to understand where our customers are getting the value. With that, being able to analyze the bundles and the pricing and the opportunities out there becomes more readily for us to see that within our existing customer base. We always like the statistics. We talked about the customer number, but we have 14 million interactions with our customers every year through our care organization. We get 1.2 billion signals from them daily. That allows us to really understand and use that data to make sure that we continue this journey going forward and look for opportunities to do more and more.
And I think just one quick add. I think sometimes it's underappreciated. At GoDaddy, two or three years ago, we invested in a new team, a new data platform for the company running the cloud. It doesn't matter whether the customer is using a product within the core segment, for example, hosting, or something in A&C like Websites + Marketing. While those products are completely different from a customer attribute and data level, literally the same machine learning models, the same data platform and AI platform drives the pricing and bundling initiative, right? That's a pretty significant advantage for a company our scale to be able to, in a couple of years, build a platform and monetize that platform, right, to a very large scale of customers, right? In our space, we're very large. And that data advantage, we think, is very real.
Great. And I want to go back to the customer count for a little bit. In 2024, customer count did decline, but really a function of some of the divestitures, the migrating of certain assets that you did in hosting. When we think about 2025, you guys are leaning back into marketing. It sounds like the top of funnel is still healthy. And you have Airo benefiting the improvement of conversion to customers. So how should we think about just the rate of growth in customer count as we look ahead?
Yeah. First, I'll start with we don't optimize for customer count. And I say that because we can go out and get as many customers as we want at any time by doing discounting. But that doesn't match our strategy of really going after customers who are coming in with intent. And that's why we took a lot of the actions we did in the past few years to really focus on attracting a customer with intent. And you start to see it show up in data points we've given. Average order size is going up. We're seeing our retention rate on the core GoDaddy platform stronger than our overall retention rate. So we're seeing those metrics of going after that customer with intent working.
So while we feel we're passing some of the headwinds that we caused, and they were divestitures. They were end-of-life in certain products, migration of other products to the core GoDaddy platform, even getting rid of viral discounting at the front of the funnel because that led to not getting those customers that were coming in with intent. All those actions we felt were important to really focus the strategy on going after customers coming in with intent. So while we feel good that those headwinds will abate around our customer count going forward, it doesn't change the overall strategy, is to really go after that particular customer that is really doing business, launching something, going after that.
So again, not optimizing for what I call the input, optimizing for the output of getting to that customer who is doing more with us upfront, going for that customer with the 2+ products, going for that higher retention rate. Those are the outputs that we are really looking for in our customer count right now.
Yeah
And just a quick clarification. While Airo has helped conversion to customers, it has been a net positive. Airo's real focus is on LTV, right, through attached, through bundling, all of those and engagement. Its real goal is to improve LTV.
Yep. And you guys have, yeah, clearly deliberately shifted to focus towards that higher value customer with that increased propensity to adopt multiple products. And you can see that in the ARPU expansion, where you've had about 8.5% growth in 2024, accelerating from 3% in 2023. So any sort of framing of kind of where this could go, given the combination of Airo driving that better LTV and increasing the product portfolio awareness and just the intuitive pricing and bundling strategies that you guys have?
I would say it will continue to go the right direction, all right. That's what we're looking for is incremental gain on our ARPU, but we are really focusing on what I would call is the leading indicators right now. Now, ARPU for us is a lagging indicator because it's based on revenue, and revenue for us starts with bookings, so bookings for us, we look at it as a leading indicator. We look at average order size upfront. That is a good indicator that customers are paying more and getting more value, coming in with intent. Over time, that will allow the or show up in the ARPU, but right now, we're excited about, I would say, the leading indicators of the average order size going up, the retention rates being a little bit stronger, so we feel really good we've positioned ourselves for continued expansion.
And again, over the long term, we know that we have to do it in a manner that is purposeful based on our customers, based on giving them value because this has to be done on an LTV basis, not on a short-term basis. And you can add to that, Aman. I'm sure.
No, I think you said it really well. I think we're very clear about what objective function we're optimizing and the end result of that is LTV. It's not to drive some short-term metric. We want, even for customer count, we want improvement in customer count with high-intent customers over the longer term, right? We are not looking for the customer that's here with us this year and then churn next year, and then we have to get some other folks to fill that gap. That can happen in the domain space because you can do it with vital pricing, like Mark said, but what we want is customers that want to start with more than just a domain because that's the strategy of the company.
Great. I'm going to ask another question and then open it up to the audience if there's any questions out there. So, I wanted to kind of get to that bookings point where in 2024, you saw bookings grow 9% relative to revenue growth of 7% last year and then also guidance for about 7%. And you've acknowledged that there is a duration difference between bookings and revenue that impacts the correlation between those two numbers. And I think most of us have thought about GoDaddy as being more of an annual monthly business. So, can you just help us unpack a little bit more to understand where these duration impacts are, the kind of limit that bookings correlating from more closely with revenue growth and how we should start to think about maybe those converging over time?
Yeah, I'll start with we are a pretty broad business. And a reminder, bookings is upfront for us, free cash flow. We've given a lot of metrics around our growth and free cash flow. We've talked about normalized EBITDA being on a one-to-one ratio to free cash flow and obviously moving that up the ladder. Now, bookings to revenue in and of itself, we have a transactional business. Core platform has, for example, aftermarket. A&C has GoDaddy Payments. We have hardware sales. So, when you look at the duration of when the bookings become revenue, it varies over time, right? And it can be within the same day. It can be within the month. It could be within the quarter. It could be over multiple years. And so that correlation isn't as direct as everybody sometimes plays it out to be.
But the way we always look at it is, hey, for us, bookings is cash. Cash makes its way down to free cash flow. And we're compounding free cash flow at that rate. So the momentum in the business in and of itself is working all the way down the model. And we continue to optimize for that free cash flow end of the equation.
Great. I want to see if there's any questions in the audience. I'll keep going. So, I want to get.
I saw a hand here.
OK.
I want to.
Yeah. Hey, I'll take the question. [audio distortion].
Yeah.
Question was on GABI from the cost efficiency side and what they can expect going forward.
Yeah, we continue to be super excited about the introduction of AI, generative AI, and now agentic AI within our care operations. Our care operations is a little bit different than some other folks. It is a service and sales center, right? So GABI is a solution that's built to help the Guide both service and sell better, right? So that's sort of the main reason we're excited about GABI. GABI is continuing to grow very well. It's launched across our portfolio. More and more Guides are sort of using GABI already. There are certain features about GABI, for example, it will just do certain low-value tasks for the Guides already that we're pretty happy with. But the real things that we're looking for is to be able to train up Guides much faster, to be able to handle global scale much better with GABI across multiple languages.
We're already starting to see some of that return, where it's not exactly related to GABI, but we've introduced, similar to GABI, a new conversational bot across the world that uses generative AI as its backbone as well, a very similar model to GABI. We're seeing good results with that. You'll continue to see us optimize. If you look at care overall for us over the last five years, we've continued to leverage care literally going down as revenues have gone up. We expect to be able to continue to leverage care over time while providing the best service. The model internally very much is how do we provide a better service and care for a lower price? The answer is technology. The answer is things like GABI. Thank you.
I'd like to take that question just a little bit broader about costs overall. When we look at your EBITDA margin expansion, you got it to about 100 basis points expansion in 2025 after delivering a really impressive closer to 400 basis points last year. So, what are some of the puts and takes embedded in that profitability Guide? How are things like some of the infrastructure simplification that you're doing, kind of the global talent pool that you're accessing? And I know the mix shift in A&C is also a positive factor. So just help us walk through those puts and takes and maybe stack rank kind of where you're most excited?
Yeah. So thank you for pointing out we did 400 basis points improvement. I love that. I'll call it a victory lap. When we put out our path to 33% normalized EBITDA margins in 2026, we laid it out into three buckets. Those three buckets were infrastructure simplification, access to global talent pool, which we talked about a little bit in the care organization moments ago, and then obviously the tailwind related to A&C. Now, a lot of those actions were front-loaded, right? We did a lot of work in 2023 to get to a point where we would see those benefits. And what you saw in 2024 is those benefits materialize very much on the front end. And as you look now out at the outer years, we're seeing the tailwind related to the growth in A&C.
As A&C becomes a bigger part of our business now, remember, it started the year at 30% of our business. It will end the year around 40% of our business. That creates that incremental tailwind for us on the normalized EBITDA margin. You see it basically creating that increase in 2025 and then becoming more of an increase in 2026 as it gets even bigger. That was the path laid out. Obviously, we continue to look for areas that we can improve. We are never done at looking at our organization, how we go forward, how do we make things better. The path there is really part of that three buckets that we put into play at our investor day.
Great. With that, we are just about up on time. So Aman, Mark, thank you so much for joining us today.
Thank you. Great being here.
Thank you for having us . Thank you.