Gen Digital Inc Q2 2025 Earnings Call Transcript

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

Question: Andrew Nowinski - Wells Fargo Securities LLC - Analyst : Good afternoon, and thank you for taking the questions and congrats on the strong Q2 results here. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 30, 2024 / 9:00PM, GEN.OQ - Q2 2025 Gen Digital Inc Earnings Call

Question: Andrew Nowinski - Wells Fargo Securities LLC - Analyst : Thank you very much on. I wanted to dig into the net adds this quarter, which I thought were very impressive. I mean it seems like it's almost a guarantee that every adult in the US now has their personal data on the dark web thanks to all the breaches we saw this summer, including that national public data breach. So do you think the net adds will improve, particularly in the US going forward? Because I think you said it was more influenced by the international growth this quarter.

Question: Andrew Nowinski - Wells Fargo Securities LLC - Analyst : Got it. And then I wanted to -- maybe just a clarification. I think last quarter, you talked about the Norton cross-sell penetration had increased to 20%. I didn't catch it this quarter if you gave that. But I was really wondering also did you see an improvement in the LifeLock attach rate or customers upgrading to that higher-end membership that includes LifeLock this quarter given all the breach activity?

Question: Andrew Nowinski - Wells Fargo Securities LLC - Analyst : Got it. Thank you. Keep up the good work. Thank you.

Question: Peter Levine - Evercore ISI - Analyst : Thank you for taking my questions (technical difficulty) maybe to you. You talked about Genie AI I know you -- so with -- I think you mentioned, I think it was like 1.6, 1.7 downloads. But Vincent, in your commentary, you called out, I think, so more to come on that front, but will enable debt AI across your core offerings. Can you maybe just talk a little bit about your kind of what the aspirations are there in terms of putting that across the platform? And then maybe explain to us the monetization opportunities or if it's more of a resin tool just to kind of be more competitive. Just help us kind of balance those,

Question: Peter Levine - Evercore ISI - Analyst : And maybe the second question or follow-up here is benefits enrollment. I know this was the quarter I think most would sign up for it. So maybe can you just give us an update on how that pipeline kind of closed off for the quarter versus expectations? And then kind of if you think about how this season ended, any changes that you're making to the go to market to your partners to kind of accelerate that for next year?

Question: Peter Levine - Evercore ISI - Analyst : If I can just ask one more. Are these agreements when you go into a company and offer the benefits, is it an enterprise agreement? Or how does that get priced versus the consumer model? Just curious in terms of the pricing model versus the...

Question: Tomer Zilberman - Bank of America - Analyst : Great. Hi, guys. I wanted to go back to the direct customer net adds. So when we look at the $389,000, how much of that would you say is coming from the ads of international and mobile versus what you said the better identity sales on the back of the national data breach. And really, what I'm trying to ask here is what do you think is the normalized customer growth in the remainder of the year?

Question: Tomer Zilberman - Bank of America - Analyst : Got it. And maybe as a follow-up, looking at the guidance raise this year for the full year, I saw in the quarter, your negative currency impact went down to about $1 million from $7 million over the last few quarters. How much of that is driving your guidance raise versus just the better business trends that you're seeing?

Question: Tomer Zilberman - Bank of America - Analyst : Got it. Okay. Thank you.

Question: Hamza Fodderwala - Morgan Stanley & Co. LLC - Analyst : Good evening. Thank you for taking my question. So I wanted a solid quarter in terms of top line, really strong sort of record net adds. I wanted to have a question on the cost side of the equation. The EBIT margin, I think, was slightly higher than it was in recent quarters. Just curious on the cost side, what are you seeing in terms of advertising costs. I know in the past that kind of gone up and down. So I'm curious what you're seeing currently?

Question: Hamza Fodderwala - Morgan Stanley & Co. LLC - Analyst : Maybe can I be more specific in the direct-to-consumer side of the business, how would you say advertising costs have been trending in the last few quarters up or down?

Question: Hamza Fodderwala - Morgan Stanley & Co. LLC - Analyst : Got it. So it's a higher lifetime value subscriber, but maybe initially might be a little bit higher CAC. Does that make sense. Thank you.

Question: Matt Hedberg - RBC Capital Markets - Analyst : It's [Matt Hedberg] (technical difficulty) you just mentioned accelerated bookings growth in your answer to one of the last questions. that 5% constant currency number, really nice to see, especially following the uptick of 4% last quarter. And then it looks like the key assumptions moved up to 4% to 5% from 3% to 5% last quarter. Maybe just what could that 5% portend for revenue growth over the next year? Should we think of maybe the difference between bookings and revenue growth, it's maybe narrowing or maybe solidifying a potential around revenue acceleration? Just any further thoughts around accelerating bookings growth here?

Question: Matt Hedberg - RBC Capital Markets - Analyst : That's helpful. And then maybe a little more on any action that you maybe undertook outline that social security number breach. I mean, did you change marketing messaging channels? It seems like you had pretty prescient timing around the personal data exposure product. Any specifics you may have done to lean into it a little further?

Question: Matt Hedberg - RBC Capital Markets - Analyst : That's great. Thank you.