Truecaller AB Q1 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Predrag Savinovic - Carnegie Investment Bank AB, - Analyst : Hey, guys. Thanks for taking my questions and congrats on the great figures again. And Alan, if you can elaborate a bit on the launch of video ads. And I recall that you have previously said you see demand in the market for this, but it's a feature that you have then been like. So if you can deliver on this, then you could theoretically then get the revenue per user. And also recall that historically when you have made platform enhancements them, they have been quite impactful. So how substantial is this initiative from?

Question: Predrag Savinovic - Carnegie Investment Bank AB, - Analyst : Okay. And then it sounds based on your presentation on Subscribers and Truecaller from business that the growth could accelerate further from the level they have in Q1. And what I mean, as you talk about new pricing, your partners, there's demand for new products. You have more customers in and so on, is that a fair assessment?

Question: Predrag Savinovic - Carnegie Investment Bank AB, - Analyst : Okay, great. And just a final one on if you could discuss the net working capital in Q1 and what is driving it and what you expect for the second quarter?

Question: Predrag Savinovic - Carnegie Investment Bank AB, - Analyst : Okay. Very good. Thank you very much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 07, 2024 / 11:00AM, TRUEb.ST - Q1 2024 Truecaller AB Earnings Call

Question: Stefan Gauffin - DNB Markets - Analyst : Just Hello. A few questions, please. From the first, can I follow up from Predrag and regarding our price increases for premium users and all support to qualify Q4 business and you say that there are price increases planned. Can you somehow talk about the magnitude and timing of these price increases?

Question: Stefan Gauffin - DNB Markets - Analyst : Okay. And then just a question on IPL and thanks for the slide showing the revenue impact but, I just don't I really understand for this year, the IPL is running from around March 20 to May 26. How come do you see these revenues, even split between Q1 and Q2 are not more Q2 tilted.

Question: Stefan Gauffin - DNB Markets - Analyst : Okay. Fair enough. And then just perhaps I missed this during the call, the cost increase in Other external costs of SEK23 million is tied to primarily relate to the increased investment of your tractor fleet and you're planning to continue your plan to continue with it. Is this cost increase representative for what you expect for the remaining quarters in 2024? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 07, 2024 / 11:00AM, TRUEb.ST - Q1 2024 Truecaller AB Earnings Call

Question: Stefan Gauffin - DNB Markets - Analyst : And then just the final one, you see that average revenue per paying you are in the US is 100 times the average for free users of two quarters to quarter globally. This would indicate around [SEK100] in quarterly or can you come from that calculation.

Question: Stefan Gauffin - DNB Markets - Analyst : Okay, thanks.

Question: Akhil Dattani - JPMorgan Chase & Co, - Analyst : Yes, afternoon. I've got a couple of questions as well. Please, if I can. Firstly, can I just ask a follow-up on the IPL commentary that you've given and given you're saying that the IPO contribution in '24 is expected to be more like the 2022 level in 2023? And I just wondered, does that mean that we should be assuming that the ad revenues in Q2 should be similar to Q1 in absolute terms or any other any other sort of impacts we should be considering there. So just understand better and how your content bill impacts the absolute numbers that's the first question.

Question: Akhil Dattani - JPMorgan Chase & Co, - Analyst : The second one is just to follow up. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 07, 2024 / 11:00AM, TRUEb.ST - Q1 2024 Truecaller AB Earnings Call

Question: Akhil Dattani - JPMorgan Chase & Co, - Analyst : Okay. So second question is just on the point you've been making around app engagement and pivoting towards video based on ads over time. And Alan mentioned a comment around the significant increase you've seen in app engagement. And you said it was, if I understood correctly, a 50% increase in user engagement to the app can you help us understand what that is in absolute terms? Just to understand you have 50% of what base and I'm Alan mentioned as well the and point around the importance of driving our PAP engagement before you push and video ads into the base, which obviously makes a lot of sense. But how should we think about the potential monetization opportunity there. As you said, I mean, video ads are generally a lot higher CPM's and on traditional banner ads. Is there any sort of scale or magnitude you can give us to help us understand just how big of a step-up that could really be?

Question: Akhil Dattani - JPMorgan Chase & Co, - Analyst : I would say that makes sense and Alex, just to complement that, I mean, if we back out from the numbers that you report the implied on data monetization per door and it's at about 15, does that include things that you're doing inside the app or is that purely outside of the app today?

Question: Akhil Dattani - JPMorgan Chase & Co, - Analyst : That's both. Okay. Fine. And then just a last one on them to qualify the business. And I just wanted to understand a little bit better the point you're making on price increases, how should we be thinking about the incentive structure that you're putting through to facilitate these price hikes? Is this a more-for-more type structure where you're adding more value and enriching the proposition for customers to facilitate the price hike? Or is it purely you think you've been underpricing and that's just an opportunity to close the gap? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 07, 2024 / 11:00AM, TRUEb.ST - Q1 2024 Truecaller AB Earnings Call

Question: Akhil Dattani - JPMorgan Chase & Co, - Analyst : Great thanks. And just one clarification on the how do the mechanics of this work with customers typically locked into contracts, so the price hikes only apply once they roll off or is this an immediate mechanism that all customers would be impacted as and when you introduce the change?

Question: Akhil Dattani - JPMorgan Chase & Co, - Analyst : Great. Thanks so much.

Question: Jesper Von Koch - Redeye AB - Analyst : Hey guys, thanks for the presentation and also congrats to the great results. And so starting at the starting off with a with the question about cookies. I mean, quicker than Google Chrome are expected to be phased out year and half of it is expected to make similar changes stats on Google Play, like perhaps later that same year. If you have any views on this and the possible impact on Truecaller?

Question: Jesper Von Koch - Redeye AB - Analyst : So perhaps on a like a competitor basis, you would probably be a bit better off than many competitors that would not have the and the telephone number as the identifier?

Question: Jesper Von Koch - Redeye AB - Analyst : Great. And then just a on the on your new light partner competition in Truecaller business, do you see any like geographical or product specific differences in what you're what you can expect from the different partners and possibly also like the magnitude now when you release, like other than Tanla other partners as well.

Question: Jesper Von Koch - Redeye AB - Analyst : Okay, thanks. That's all for me.

Question: John Karidis - Numis Securities Limited - Analyst : Thank you and my congratulations to you for another set of results. A good set of results. And firstly, can I ask, should we expect the ratio of dows to mouse to start or to continue to is to increase going forward, given what you've said about app engagement and the fact now that you've had a few periods where that ratio of down two miles has been 100% or more? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 07, 2024 / 11:00AM, TRUEb.ST - Q1 2024 Truecaller AB Earnings Call

Question: John Karidis - Numis Securities Limited - Analyst : Thank you. Secondly, and was I wrong to think that you actually started seeing some ad market sentiment recovering in some of your relatively small markets, at least.

Question: John Karidis - Numis Securities Limited - Analyst : Right, but does it look promising? Can you say anything about that, please? I'm just trying to get the reserve, take the temperature of the ad market in India just now. So anything you can say would be useful, please?

Question: John Karidis - Numis Securities Limited - Analyst : Absolutely fair enough. Thank you. And then I'm sorry to come back to that. I'm trying to understand how much Well essentially what I'm trying to understand is whether the other operating costs in Q1 are likely to be if you analyze, annualize them where like they are for indication of what you'd like to have for the full year. But I guess a simpler question would be, am I right to assume just to think that the extra investment you made in Q1 was around SEK20 million.

Question: John Karidis - Numis Securities Limited - Analyst : Okay. Thank you. And then lastly, I suspect I'm not going to get much joy from you to the Hayward van. As you said, perfect. You said them it's tough to understand to sort of figure out what the negative FX impact is on revenue. I'm trying to see if so would the best guess be closer to SEK5 million or closer to SEK10 million. Anything you can say there.

Question: John Karidis - Numis Securities Limited - Analyst : Slightly more than SEK10 million or SEK5 million.

Question: John Karidis - Numis Securities Limited - Analyst : Okay.

Question: John Karidis - Numis Securities Limited - Analyst : That's fair enough. And if I may, lastly, just to push my luck in a big way, Alan, just going back to the dows versus mouse, and I hear you about the engagements there, but it has been the case that if you divide and serious growth in dow's by mouse and it has been 100% or more for a number of quarters to date, and should doesn't that mean anything positive about the 80% rate of the ratio, which of total dollars divided by total Mouse?

Question: John Karidis - Numis Securities Limited - Analyst : And well, in your statement, you said 9 million extra, dow's? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 07, 2024 / 11:00AM, TRUEb.ST - Q1 2024 Truecaller AB Earnings Call

Question: John Karidis - Numis Securities Limited - Analyst : Understood.

Question: John Karidis - Numis Securities Limited - Analyst : Yes, I understand. Thank you.

Question: Boris Markovich - Cantor Fitzgerald Securities - Analyst : Hey. Thank you for taking my questions. Can you please quantify the churn in your consumer subscription business, if possible? And it's possible to split it out across India and outside as well, that would be helpful. And the consumers who are churning, what are they seeing after the region?

Question: Boris Markovich - Cantor Fitzgerald Securities - Analyst : Okay. And next question I have is, can you speak about the increased supply in the digital lab in India that you mentioned. I think you mentioned this last time as well. Who is it actually coming from? And are you worried at all about the risk that the supply keeps increasing coming years as well, and therefore, CPM remain structurally depressed in India? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 07, 2024 / 11:00AM, TRUEb.ST - Q1 2024 Truecaller AB Earnings Call

Question: Boris Markovich - Cantor Fitzgerald Securities - Analyst : Sure. Thank you. Are there any KPI's that you can provide in terms of the returns you're (technical difficulty) making for advertiser's comparison to others?

Question: Boris Markovich - Cantor Fitzgerald Securities - Analyst : All right. Okay. Thank you.