Nexi Aktie

Good morning. This is the Chorus Call conference operator.

Welcome, and thank you for joining the Nexi First Half 2026 Financial Results Presentation. [Operator Instructions] At this time, I would like to turn the conference over to Bernardo Mingrone, CEO of Nexi. Please go ahead, sir.

Good morning, everyone, and welcome back to our first half results call. I'm here today with Piergiorgio and Stefania. We will take you through our documents. And then at the end, we will open up the floor for Q&A as is usual.

Let me start with a few introductory remarks with regards to the highlights of the first half. I would say that the first half has been very much consistent throughout the first quarter and the second quarter. As you can see, revenues grew 1% overall, similar to what it was in the first quarter also for the second quarter.

Importantly, our underlying growth is pretty steady at around 5%, as we have discussed at length also during the Capital Markets Day presentation back in March. Our EBITDA in the first half was broadly stable. And I would like to highlight how excess cash generation was EUR 400 million, pretty similar to what it was in the first half last year. So a figure of data, which is comforting and puts us in a good position compared to our guidance for the whole year.

The second thing I'd like to focus on is how we're shaping Nexi for our future profitable growth. In this, I just highlight how we continue to make progress on our road map to close the valuation gap at least between how I and the management team perceive Nexi's underlying and true value to be and what it is perceived by investors. And we spoke of this back in May with the first quarter results.

Overall, our strategic initiatives are well on track. We've spoken of in the past our efforts in the ISV space and the all-important convergence of software and payments, where our initiatives are proceeding as per plan in the geographies in which we operate.

Today, we announced an organization simplification, which has been underway for the last couple of months, and this will help us approach our journey going forward in the most efficient and effective way in the future. And it also helps us with our continued and ongoing steadfast commitment to cost containment and discipline, and Piergiorgio will speak about our cost performance in a few minutes.

Overall, I also like to highlight how with regards to creation of value for our shareholders, in the first half, we have successfully, as expected, obviously, paid out EUR 350 million of dividend back in May. We have completed the acquisition of the Banca Popolare book in the beginning of the second quarter, and we have paid down over EUR 1 billion of gross debt.

I think this was part of an overall strategy that we also discussed back in May of the capital allocation and the most efficient use of the cash balance on our books. We started the year with just over -- just under EUR 2 billion of cash. This cash is being used, as I said, to pay down debt, and we'll continue to pay down debt as it comes due; make dividend distributions and also complete the M&A transactions that we had announced.

As you will see, gross leverage, therefore, has come down and our net cash balance has come down as well. And we will continue to use that cash in the most efficient way, which right now is reimbursing maturities as they come due without accessing capital markets.

Second thing I would like to speak about is something we'll definitely be hearing more of in the future, and it is the Digital euro program. As you know, Nexi has been a member of the Digital Euro stakeholders group since the start since 2021. We have been part of the MAG, the Market Advisory Group. We have contributed to developing the rule book. We are on the Italian Payments Committee. And in general, we are part of the overall ecosystem that is participating led by the ECB in defining the rules and implementation of the Digital Euro.

Back in '22 and the beginning of '23, we also developed the first Digital Euro prototype, and we have been participating as we've spoken of in the past, the ECB's public tenders. In a consortium led by [ G&D ], we won the tender on the offline, and we're now participating in remaining tenders in the infrastructure part of the Digital Euro. So we are keen to play an active role in the development of this critically important infrastructure.

Finally, we have recently announced or the ECB has recently announced that we were selected to participate in the pilot phase of the Digital Euro, something we're keen to leverage on in promoting a system-wide solution for other banks that would be able to benefit from the technology Nexi is developing in the Digital Euro in order to socialize the cost of this opportunity and position us as an infrastructure provider for the Digital Euro to market participants and something we will be speaking more of going forward.

That said, let me hand the floor over to Piergiorgio, who will take us through the details of the second quarter and the first half performance, and then we'll come back to you open the floor up for Q&A.

Thanks, Bernardo, and good morning, everyone, and thank you for joining us today and for your interest in our company, Nexi.

Let me start from where we left off a few months ago during our first quarter results call. The message we shared back then remains fully consistent with our Q2 results and confirms once again that we are a business built on a resilient and diversified growth drivers, both from a geographical and operational viewpoint, supported by healthy underlying trends. We remain highly disciplined in managing costs and investments, and we continue to deliver strong EBITDA and a robust excess cash generation.

Overall, Q2 confirmed the resilience we saw in Q1 with solid underlying growth and sound profitability despite the expected impact of bank contract effects across both Merchant Solutions and Issuing Solutions as well as some softness in consumer spending, particularly in Germany.

Starting with the top line, year-to-date revenues are slightly above EUR 1.7 billion, up 1% versus 2025, broadly in line both with our expectations and what we saw in Q1 and consistent with the back-end loaded growth profile we outlined at our recent Capital Market Day with no major deviation to highlight.

Year-to-date EBITDA at EUR 870 million is in line with last year and with our guidance, while Q2 EBITDA at EUR 473 million was slightly below 2025, reflecting the expected normalization of OpEx phasing that I anticipated and we discussed back in May. I would, therefore, strongly encourage you all not to look at this quarter in isolation.

I will come back to operating expenses later, but let me say that we are very pleased with the first half OpEx growth slightly below 2%, while keep on investing to support the top line initiatives discussed during the CMD.

Year-to-date EBITDA margin at 50.1% was just below 2025, which closed at 50.6%, supported by disciplined execution and the cost control initiatives we put in place over the past few months.

In Merchant Solutions, Q2 revenues were broadly stable year-on-year. This brought year-to-date performance to minus 0.8%, improving from minus 1.4% at the end of Q1. We are beginning to see the gradual recovery we discussed with further acceleration expected in Q3 and Q4 as our strategic growth drivers gain traction and the impact of bank contract effect reduces.

To this point, I'd like to underline the positive contribution of direct channels where we keep on investing, as outlined again during the CMD and ISVs, whose impact to our sales is slightly better than our original assumptions.

Looking at the underlying performance, revenues increased by around 3% year-on-year. On volumes, the value of managed transactions continue to expand, supported by processing activities and the ramp-up of the Bancomat processing hub consolidation in Italy. This remains an important development as it further strengthened our positioning as an infrastructure provider within the payment ecosystem.

At the same time, the macro environment softened versus Q1 in one of our markets. In Germany, consumer spending weakened during the quarter, putting some pressure on volume growth, even as new customers acquisition continued to run ahead of last year. So far, the overall impact has remained contained.

Let me now move to Issuing Solutions. IS delivered another robust quarter with revenues up 1.5% in Q2 and approximately 3% in the first half of the year. despite the impact of the bank-related contracts. The results were supported by solid core business trends with the value of managed transaction remaining very robust and growing by 7% in the first half.

Looking at the main drivers, the momentum was supported by the ongoing ramp-up of the Nexi Bancomat processing hub in Italy and the completion of the onboarding of a large customer in DACH, together with sustained expansion in international schemes. This was further complemented by the positive contribution of our business levers, including international debit in Italy and the increasing penetration of value-added services across our current portfolio.

As we highlighted in May, the first quarter results also benefited in part from favorable timing of [ sterling ] projects and initiatives, which mainly explain the difference growth rate between Q1 and Q2. Going forward, we expect the nonbank-related headwinds to become a bit more pronounced in the second half of the year. As a result, we anticipate full year growth for Issuing Solutions to be in the low single-digit range, fully consistent with the framework we have previously shared with the market.

Moving on, DBS delivered strong results with revenues up 6% in Q2 and 4.5% in the first half. This was supported by solid volume trends across SEPA Clearing, Open Banking, Network Services and PagoPA, together with the contribution of new projects and business initiatives.

We also benefited from favorable timing of certain activities, including bank M&A-related work while seeing additional contribution from initiatives such as verification of pay -- Zippay and the digital Euro-line project Bernardo just talked about.

As we have consistently highlighted, DBS is structurally more exposed to project-based revenues than our other businesses. And part of the first half progression reflects positive project phasing. While the underlying business trajectory remains very sound, we continue to expect full year growth to be in the low single digits.

Moving on to the next slide, our geographic diversification remains one of Nexi's strength, helping us to deliver resilient and predictable growth despite localized headwinds in specific markets.

Starting with Italy, revenue grew 0.4% year-on-year in the first half, improving from a decline of 0.4% at the end of Q1. Let me remind you that Italy is the region most affected by the bank-related contract effect.

In the Nordics, revenues declined by 1.7% or EUR 5 million in H1, mainly reflecting the migration of a large issuing client at the end of 2025, as we have discussed many times in the past. Excluding this effect, the underlying trend remains solid, supported by sustained momentum in e-commerce, value-added services and national scheme. Also in this case, Q2 improved compared with the start of the year, and we expect further progression in H2.

Moving to DACH. The region delivered strong growth overall with revenue increasing by more than 7% in the first 6 months. Austria and Switzerland remained very strong also in Q2, continuing to benefit from healthy commercial momentum and disciplined execution.

In Germany, however, we experienced a second soft quarter, reflecting a challenging consumer environment, particularly in hospitality, where our exposure is relatively higher. As evidence of this challenging scenario, Germany recorded one of the highest levels of corporate insolvencies in the last 2 decades. Despite these market conditions, commercial momentum remains encouraging with new customers acquisitions increasing at a faster rate over last year.

Finally, CSEE continued to grow, even though at a softer pace in Q2, mainly because of some phasing in non-volume-driven revenues and ongoing mix and pricing pressure in our Polish e-commerce franchise.

Let me now turn to cost performance. As I highlighted, our first quarter call, looking at the single quarter in isolation does not provide a meaningful view of the underlying cost trajectory of our business because timing and phasing effects can influence quarterly performance. For this reason, I believe the first half as a whole provides the most relevant perspective.

In the first 6 months of the year, total cost increased by slightly less than 2%, moving from EUR 850 million to EUR 866 million despite ongoing inflationary pressure and on labor and other operating expenses, as well as higher volumes. This result was achieved while investing in the strategic priorities outlined during the CMD, which will support Nexi future development.

Personnel costs increased broadly in line with our expectations at about 4%, at the same pace we saw in Q1, reflecting salary adjustment and investments made during 2025, plus what we did in 2026 -- the beginning of 2026, specifically to support our strategic growth drivers.

At the same time, operating expenses remained essentially flat year-on-year. This reflects a combination of continued operating leverage, disciplined expense management and the first benefits from several cost control measures launched over the past few months. These initiatives span both technology and nontechnology spending and are increasingly supported by AI-enabled productivity improvements across the organization.

Overall, I am very encouraged by the progress we are seeing so far, and the first half results reinforce my confidence that we will continue to manage our expense base with discipline throughout the remainder of the year and to deliver our full year profitability and excess cash objectives.

Moving on to CapEx. As we indicated at the beginning of the year, we continue to invest in key pillars of our strategy: growth, platform modernization and consolidation and product quality, innovation and security.

In the first half, CapEx amounted to approximately EUR 168 million. This was broadly in line with last year and slightly better in terms of both absolute CapEx and CapEx intensity, while we continue, as I said, to invest in strategic growth drivers. This reflects once more disciplined execution, clear prioritization and our continued focus on cash, cost control and efficiency.

Let's now move on to cash generation. Our cash conversion profile remained a key strength in the first half. We generated EUR 400 million of excess cash during the period, once again demonstrating the strong cash conversion characteristics of our business model. This result was achieved while continuing to invest in the business and funding the strategic initiatives we have discussed many times.

Overall, H1 results confirm the resilience of Nexi cash generation model and give us full confidence in our ability to deliver around EUR 750 million of excess cash for 2026, consistent with our guidance that we reaffirmed today.

The strength of our cash generation has also enabled us to continue executing our capital allocation priorities. As Bernardo just said, during the first half, we repaid approximately EUR 1 billion of debt maturities, paid around EUR 350 million of dividends to our shareholders and completed the [ BPS ] deal, leveraging our strong liquidity position while maintaining a solid financial position and preserving our investment-grade credit profile, which was reaffirmed very recently by both Fitch and Standard & Poor's just in July.

Let me conclude with our outlook for the full year. As you can see on the slide, we are confirming all elements of our 2026 guidance. On revenues, the underlying business drivers remain intact and Merchant Solutions is progressively reaccelerating as expected. At the same time, we continue to see a somewhat softer consumer environment, particularly in Germany, as I said, and the second half includes important seasonal periods such as the summer and year-end, which naturally carry a higher degree of variability.

Taking this factor into account, our current view remains that revenues are on track to be in line with our guidance with a final landing point depending on the normal evolution of consumer spending and seasonal dynamics over the coming months.

Importantly, we also have a high degree of confidence in our ability to deliver our EBITDA guidance and our excess cash target of around EUR 750 million. Once again, this confidence is supported by the flexibility we retain on our cost base and by the strict cash control we demonstrated in the first 6 months of the year.

With that, we can start the Q&A session. Thank you.

[Operator Instructions] The first question is from Sébastien Sztabowicz from Kepler Cheuvreux.

First of all, on the short term, how do you see volumes trending since the start of the quarter? Have you seen any specific change versus what you have seen in the second quarter? And I know you mentioned some softness in Germany, but also in Italy. Could you please elaborate a little bit what is happening in those countries?

And second question is on the ramp-down of some specific projects, including Banco [ BPM ] in Italy and Nordea issuing. Where are we standing right now in terms of progress? Are you in line with the plan? Or are you doing it better or worse than initially expected?

Thanks for your questions. With regards to volume evolution in the first half -- throughout the first half, I would say there's not been anything material to call out in terms of fluctuations or others. As we always point out, it's very hard to glean any information from one week to the next. And I would say that overall, the 6 months were pretty much aligned with our expectations in terms of development. What -- this is throughout the group then Piergiorgio called out, I think, Germany rather than Italy and Germany.

And in Germany, indeed, I mean, we all read the press, and we've all read about very substantial redundancies being called out in the auto sector with hundreds of thousands of people being laid off. And in general, the macro environment, in general, in Germany has been worse than our own macro expectations, which we had put underlying the plan.

Now this is obviously contributing to a slower-than-expected performance in Germany. But I wouldn't make anything more than that out of it because, as you know, as we've discussed in the past; most of our growth comes from increased levels of penetration. And in Germany, in particular, our real bet is not so much on macro performance, but on increased penetration levels.

Germany is one of the countries with the lowest levels of penetration in digital payments and increasing market share because we are a smaller player in Germany than some of our competitors.

That said, Germany is suffering from the macro, but as hopefully, that things will improve over time, and that will also help us. But in general, the environment in terms of also the holiday season and tourism, et cetera, doesn't highlight anything we should be concerned about.

With regards to the migrations, I would say, on the customers that you mentioned in Italy, I think what you see in our first half numbers reflect -- largely reflect our expectations with regards to the migration away from next year of those banks that churned back in 2023 and '24 that we spoke so much of during our Capital Markets Day.

So what we -- and the churn was both an issuing and acquiring with regards to Banco that you mentioned earlier. It started with acquiring. And now moving into second half of the year, we are going to kind of benefit from the fact that, that is over compared to last year where it was in full swing in the first half of this year when it was being completed.

So what we had guided you to was that we would have a gradual improvement over 2026 between first half and second half on the Merchant Solutions revenue front. And you can see that the negative growth in Merchant Solutions in the second quarter is improving compared to the first quarter because of this effect. So the lapping -- the year-on-year lapping of the exit of Banco is coming to an end. And in the second half, we expect an acceleration in Merchant Solutions simply from the comp effect. So that's happening.

And then we also said that this would switch from -- the migration away from us would switch from Merchant Solutions or from acquiring to issuing, and that is starting and Banco has started. And as you can see, issuing has slowed down in the second quarter compared to the first quarter, and this will continue in the second half of the year. So I would say this is mostly planned.

On the issuing front, we also have the Nordic customer that you mentioned, whose impact also started during the first part of the year and actually started many years ago and will be exhausted by the end of this year.

And just on Germany, what was the trend exactly in terms of revenue in Q2 and in Q1, just to understand a bit of the deterioration that you mentioned?

The second quarter, I'll hand the floor to Piergiorgio, who can give you more details, but obviously, the second quarter is slightly worse than the first one.

Yes, Sebastien, I believe that -- and thanks for your question. If you look at our slide where we present the revenue by geography and you do reverse engineering compared to what we presented in Q1, you would see that Q2 overall, I mean, DACH region is growing more or less by 2%, give or take, right?

As I said in my remarks, in my written remarks, DACH is the sum of Germany, Switzerland and Austria, with Germany being the biggest player by far. So this plus 2% is a little bit better than what Germany did per se since, as I said, Austria and Switzerland doing fine. So a ballpark number, call it, between 1% and 2% in Germany and the other two geographies that growing mid -- a little bit more than a mid-single digit -- mid- to high single digit.

The next question is from Justin Forsythe from UBS.

First question for me. I just wanted to ask around excess cash and the moving pieces. I think we were expecting a little bit more of a 2H weighting despite the tax impacts as you flagged and consistently hit in 2H. So maybe you could just walk us through if there's anything you're expecting that maybe you weren't expecting initially to hit excess cash negatively in 2H and walk us through the moving pieces there.

And I wanted to ask a follow-up on Germany. I just was wondering if you could be -- you talked a little bit, Bernardo, about the layoffs in the automobile sector. Piergiorgio, you flagged specifically hospitality. Maybe you could just talk a little bit about the specific challenges there? Like is that, say, people flying to Germany from places in the Middle East? Is it more due to economic hardship across the region? Is that more in like food and beverage? Just trying to get a feel for the dynamics there.

And what does this imply for the rest of the year? I guess you feel very comfortable reiterating the guidance. So you again still expect that acceleration in Merchant Services through the rest of the year?

And I guess one other follow-up on Germany. You spoke a little bit about software-led or ISV distribution in Germany. I remember that business actually being a lot of direct distribution. So maybe you could talk a little bit more about where you're having success with the ISV business? Is that more Orderbird? Is that partners that you're bringing up through the pipe, et cetera?

Okay. Thanks, Justin. Let me try and answer all three of your questions, all four, but I'll place the fourth one with the second on Germany and then Piergiorgio obviously can help me where I get stuck.

But with regards to excess cash, there is some seasonality with it, so -- especially on things outside of the P&L. So if you think of CapEx and the phasing of CapEx, that obviously helps or contributes to cash generation. And the timing of that is less predictable, it's less of a flow. It's more lumpy and got to do with projects.

That said, so indeed, given our guidance of for the year and the fact that the second half is generally 52%, 53%, I would say, weighted compared to the first half of the year in terms of EBITDA generation and hence also cash generation notwithstanding taxes being in the second half. All that said, a bit better than we expected, but that is also to do with one of the points I made earlier.

One of the things that we're working on is obviously to try and perform as well as we can on costs and in general, cash generation. I think we're being successful on that front. So I believe that the cash generation in the first half is a good indicator of our performance for the year and the fact that we are very confident that we will meet our guidance at this stage of the year. So there's nothing lumpy one-off that you should normalize for. It's just in general, something that we're working on and we're doing well on.

On Germany, I go back to my remarks about how Germany is, for us, a market in which we win or lose more on -- based on our ability to develop our distribution channel successfully and our ability to win market share from competitors given where we start from and on the fact that the German market, the kind of rising tide of payments that lifts all players in that space. That's much more important than the macro.

That said, when you're talking about 1 percentage point, 2 or 3 percentage points of growth, which is EUR 1 million or EUR 2 million or EUR 3 million in the year; obviously, also macro impacts. And I think everything we mentioned and you reiterate contributes to that negative effect. The fact that unemployment is going up in Germany or people are being laid off, obviously, that leads to consumption being under pressure.

In general, the HoReCa space is less -- is not growing as much as it used to. It's actually hitting a rough patch. And I'm not able to answer the question as to whether this is Middle East tourism that is coming down. In general, what we see is restaurants and hotels being less productive than in the past for us in terms of volumes.

What I'm focused on is how our strategy to win market share is performing. And on that front, given that you asked the questions about the channels, I think we're doing pretty well, if not very well, on the ISV channel and the partner channel. So that includes the ISV channel, obviously includes Orderbird. But in general, in the ISV channel and the partners are doing very well.

Where we need to think long and hard about our strategy is the direct channel where we're struggling a little more. Again, this is growing pains, I would say, in a market which represents for us a great opportunity, given its size and given the level of underpenetration. And with Thomas, who came onboard last year, about 1 year ago, actually; we're seeing if there's anything we need to change in terms of the direct distribution effort to make it as productive as we can.

With regards to the rest of the year, the forecast for the rest of the year, in general, I mean, we always caution not to read too much into short-term performance because there are quarterly swings tied to project work timing of certain issues, et cetera. But I think the first half this year has been very steady, very predictable. And I would just stick to what I said earlier.

I think we -- and Piergiorgio reiterated, I think we feel very comfortable in terms of our overall performance for 2026, given our guidance. And the further down you travel in the P&L, the more control we have. And we feel most comfortable, obviously, on the cash generation where we have the most levers to act on and the way we closed the first half is a good place to be.

The next question is from Hannes Leitner from Jefferies. The next question is from Nooshin Nejati from Deutsche Bank.

Two on my side to maybe follow up on Justin's questions actually. I appreciate you mentioned seasonality and that there was no one-off to account for. So what are the main reasons not to think this continues in H2, the excess cash and you would basically end up above your guide? I guess I'm asking if guidance is now conservative or there are specific elements to consider for H2?

And then maybe if you can please help us bridge to FY margin outlook. How should we think about cost growth in H2 relative to Q2 and maybe the difference between the quarters?

So I think you're trying to force us into revising our guidance, which we're not going to do. I mean the guidance is what it is, and we're planning to do at least $750 million of excess cash. We are at $400 million.

There is no unusual seasonality that I expect in the second half of the year compared to prior years. We pay taxes in the second half of the year, so you have thatBut the second half of the year is also heavier in terms of cash contribution coming from the business because of the summer months in December, and that is true every year.

I think in general, what we're doing, I go back to my opening remarks, we're working -- Piergiorgio and I and the rest of the team is very supportive of this. We're working to make sure that we can fund the investments we're making in our growth strategy, which we spoke of at length during our Capital Markets Day through greater efficiencies.

And of course, the world is evolving very quickly and AI and other instruments that are available to us today are helping this efficiency gain that helps fund these investments that helps our performance. But again, we give guidance on a yearly basis, and we will report on a quarterly basis how we're doing, and that's the EUR 400 million compared to the EUR 750 million minimum level for 2026.

And on the cost growth, so we saw -- we closed the quarter or the first half at just under 2%, 1.9% cost growth. We are shouldering the cost or the investments we are making in ISV and the direct sales force, primarily, I would say, in the ISV channel and the direct sales force, but not only, obviously, as we deploy AI more pervasively throughout the company, we have increasing costs related to that. But it's an investment well placed in my mind.

And notwithstanding this, we are able to contain our cost through continued efficiencies. And I think a number of times we've spoken of how Nexi has come together as 3 companies back in 2021, and these 3 companies brought with them a number of platforms and complexity, which we are working on to minimize and reduce. And the cost out coming from the reduction of this complexity helps mitigate the upward pressure on costs.

And this has always been true. I think we've always been consistent in terms of being able to manage our cost growth in a way that it is lower than what you'd normally get inertially from just volume growth, inflation, wage drift and the likes.

Also thanks to the fact that we started with a pretty articulate and complicated IT landscape that we're working to simplify. And this will continue in the second half. So we do our best and we work to try and do as well as we can and to beat the guidance that we've given you, but that remains the guidance.

The next question is from Alexandre Faure from BNP Paribas.

Got three questions, I'm afraid. First one is going back on cost growth that you just talked about now, you talked about this sort of simplifying the organization and so on. Should we expect any cash outflows relating to those efforts coming through in the second half maybe or in 2027?

Second point, sorry to get back to that, but on the guidance question. And I heard what you say on sort of EBITDA and free cash flow guide. I was more curious on your net revenue guide. Does this hold at current macro or you need macro to go back to what it was in Jan and Feb in the second half to sort of get to that net revenue mark?

And finally, I was surprised to see that Merchant Services installed base revenues seem to be coming down quite a bit again in Q2. So if you could remind us of what's in there and what's causing the decline for a couple of quarters in a row now?

Sorry, Alex, I couldn't find them. But you shouldn't apologize for your questions. We're here to answer them. So I'm happy to take them. So cost growth and simplification, as I said, we are in the process of reorganizing ourselves so that we can be as lean as possible in terms of all our decision-making processes, in terms of our go-to-market.

And this reorganization will generate efficiencies, which were probably not baked into the numbers back in March because simply they were born out of a change, which occurred after the Capital Markets Day. And this is obviously going to help us, I would say, more so next year than this year, given where we stand in the year and when these things are actually happening. But obviously, there is some benefit in 2026 as well.

But what I'd like to point out is the way we have approached this as a team is that we need to fund all investments, so including in our efficiency from the business. So I don't expect any -- so the guidance we've given you includes anything we're spending in order to become more efficient. So it's -- there's not going to be a surprise between now and year-end and saying there's a big restructuring charge or something like that associated with it.

So our guidance is including everything, which doesn't mean there's no cost associated with it, but it's funded by other savings, other initiatives, other, let's say, also phasing effects or things we might decide not to do period. So you're not going to get the restructuring charge like we had in 2024 or something like that.

That said, going forward in the next few years, every, I think, 6 or 7 years, we have the opportunity in Italy, in particular, to have early retirement windows open, et cetera. This is not something we're considering today. It doesn't mean that in the future at some point, we might not do so again. But as I said, nothing is planned. Nothing was in the planned numbers, and nothing will be happening between -- for sure between now and year-end on that front.

On the revenues front, I'd say, go back to the comment on Germany, it actually holds true for the rest of the group. Obviously, better macro helps, especially when revenues are growing 1%, every little bit helps to improve that revenue growth and macro does as well.

I stand by my -- our numbers support our numbers, our forecast for the year supports the fact that we believe that revenues will grow in 2026 similar to how they grew in 2025. And obviously, we hope that macro helps us achieve this and we do better. But right now, that's where we are. And so we'll stand by that.

And then finally, on MS, let me -- on installed base revenues in MS and the quarterly evolution, I'll hand the floor back to Piergiorgio the detail there.

Yes. Just an additional comment, if I may, on the cost guide. I believe even though it was not part of our official guidance, going back to the Capital Markets Day, we showed a slide with was saying that we would have expected our cost base, our OpEx to increase '26 over '25 by 5%, 6%. So if you do the reverse engineering of where we ended up in Q1, you would end up with a growth -- OpEx growth rate implied in H2 of around, let me say, 5-ish to 6% kind of.

We are, I would say, aiming to be on the lower side of that range, the 5% to 6% we talked about, and that is going to give us all the flexibility we need in case of further deterioration of macro conditions or variability to deliver what we committed to deliver. So that really makes us comfortable there.

When it comes down to installed base revenues vis-a-vis non-installed base revenues for MS, as you might remember, give or take, 25%, 28% of our installed base revenues -- of our revenues in MS are driven by installed base. So it just takes a couple of millions more quarter-to-quarter to change those percentages. I wouldn't read too much into that number.

If I look at the volume and I compare Q1 '25 with Q1 '26 and once again, if you go back and look at the numbers, you would see that the volume revenues is increasing nicely, I would say, it's around 1.5% installed base revenues quarter-on-quarter are going down. If you look at is the same story, they're going down by 8%. But there, once again, you have some phasing of projects plus some pressure on [ terminals ], price pressure on [ terminals ]. But again, most of it, I would say, is phasing of non-volume driven.

Okay. But I think it's just -- in general, it's fair to say that there is margin pressure, I would say, on -- or more pressure on the terminal pricing than there is in acquiring, which we're compensating with acquiring. And that's throughout the market, some players offering terminals for free, maybe ahead of IPOs or things like that.

The next question is from Antonio Gianfrancesco from Intermonte.

Just one from my side on Digital Euro. I was wondering if you can help us to understand what kind of investments, let's say, in terms of CapEx are required in the next 12 months, 1, 2 years? Whether they are already included in your current CapEx plan? And when we could start seeing an impact in terms, let's say, of incremental revenues?

Thanks for the question, Antonio. And our guidance includes everything we're doing. So it includes also the work we're doing on Digital Euro. Right now in the start-up phase and this pilot phase that we're working on, the investments are -- if we're talking about the work we're doing with the ECB and helping the ECB develop the framework, obviously, they're compensated by revenues associated with them.

We're not talking about huge amounts of revenues. We're single-digit kind of million euros for the time being and similar amounts of investments associated with them. And with regards to the development of the pilot, the capabilities to participate in the pilot phase, again, given where we are in the year, smallish investments required.

But I think significant potential going forward because the whole -- let's say, my ambition would be that Nexi can serve its partner banks, not only in Italy, but across Europe in helping them socialize the costs of being able to adopt the digital euro by having us invest once and then using us as a common infrastructure for them for sure, on the acceptance rails, but potentially also on the wallet side of things going forward.

And obviously, Digital Euro is only expected to come into being in 2029. So revenues will become -- potential revenues will become realizable from our positioning in the market as this kind of an infrastructure provider probably in 2028, I do not expect it to be sooner. Right now, we're trying to position ourselves for the pilot banks, and we'll see how that works and that might bring some benefit sooner, but not materially in the short term.

The next question is from Hannes Leitner of Jefferies.

So the first question is like you talked quite a lot about macro weakness, softness and that the guidance depends on consumer spending. It feels a little bit like a cautious stance. So where do we are in those trend lines? And so that's the first question, like really getting a little bit more granularity, where do you see actually you have more outperformed your plan to get to the headroom? Because clearly, macro looks worse today than a couple of months back.

And then the second question is again on Merchant Services and maybe there, international schemes have been slowing. Is that partially related with the contract runoffs? Or have you done the migration mostly in Italy and now you have a much bigger share in international schemes?

And just the last one is, if you look at underlying growth for the group, you talked about 4%, Merchant Services just 3%. That would imply underlying growth in Issuing Solutions around 5% or reverse EUR 10 million headwind from the bank contract runoff. Is that the quarterly cadence we should expect now for, let's say, for the next 9 months or 10 months?

Thanks, Hannes. Let me try and answer these and then obviously, Piergiorgio can help me with the greater granularity looking for.

But in general, overall, the macro weakness is -- ultimately, our revenues are growing 1%, right? I mean they're not growing 5%, which is the underlying. And part of that, we're not outperforming our own guidance also because of macro. I think it's pretty homogeneous throughout Europe. We called out Germany because it's definitely suffering a bit more than other regions.

In the past, we discussed Finland and Sweden. They're smaller than Germany, so lower contribution. But I would say that no one is doing particularly well. I mean the Nordic country, Denmark and Norway, nominal growth is actually quite healthy there with a bit of inflation, economies that's like close to 5%, if you want. And that helps. So I'd say they're probably doing better than elsewhere.

Italy is not doing that badly also for us in terms of our revenues. But it's not like there's one country that's firing on all cylinders and outperforming and dragging everything else up. I think in general, the climate is subdued. And hopefully, things will improve as time goes by, this will also help us close that gap between where we're growing at today and historically where we've been growing at.

And that comes to the last point you were making, the 5%. And yes, it's actually 5% on average for the group. Of course, if you look at the second quarter, it's 4%. But I always go back to what we caution, which is quarterly performance, you need to then normalize for weekends, for holidays, for the weather, all these kind of things.

Overall, I think we are pretty stable around that 5% mark historically and for the first half of the year. And as you were noting that we have a very diversified group, which makes it difficult for us, given the diversification of businesses of regions in which we're in, so levels of penetrations of the countries in which we operate in. And therefore, the structural capability of the group has both the cons of being diversified.

So it's unlikely that as a group, we can grow our top line mid-teens in terms of growth, even though within the group, we do have businesses that grow in double-digit space like e-commerce, like historically, for instance, some areas like Poland or whatever. But as a group, the diversification is such that on average, we'll grow less, and we've highlighted how we believe that structurally, we're capable of growing in line with our historic underlying growth.

But that said, also on the diversification helps us when Merchant Solutions is growing less than expected, you have issuing, which is very predictable and is growing 5% and pulls the average up. And it also has to do with the phasing of the exit of the bank contracts that you were speaking of or I was speaking of earlier.

So far, we've suffered on Merchant Solutions most than the migration away of us from us because it's easier to migrate away a merchant from your acquirer, you give them a new terminal and they start accepting on that, and it's easier.

Migrating a [ card ] portfolio is much more complicated and much more time consuming and frankly speaking, also from an operating standpoint, risky. And that's taking longer, and it will evolve over the next probably 12 to 24 months. So we fight tooth and nail to try and make it as slow and painful as possible to migrate away from us.

On the other hand, they're trying to do it as quickly as possible, and we'll see who is most effective. But that's how it will evolve. For sure, it will hit us -- it started to hit us in 2026, the issuing side and will continue throughout next year.

I don't know, Piergiorgio, if you want to answer anything on that.

No, I have nothing to add. You covered it very well.

International schemes.

Sorry? Okay. I think we have no more questions. So I hand it back to the operator.

So ladies and gentlemen, thank you for joining. The conference is now over. You may disconnect your telephones.

Good morning. This is the Chorus Call conference operator. Welcome, and thank you for joining the First Quarter 2026 Financial Results Presentation Conference Call.

[Operator Instructions]

At this time, I would like to turn the conference over to Bernardo Mingrone of Nexi. Please go ahead, sir.

Good morning, everyone. Good morning, and welcome to our First Quarter 2026 results call. I'm here today with Piergiorgio Pedron, our CFO; and Stefania Mantegazza, our Head of IR, as usual. Let me start on Slide #3 with the key highlights of the first quarter performance. We continue to deliver profitable growth. As you can see and we'll discuss later with good jobs as well. Our revenues grew about 1% in the quarter year-on-year. Our underlying growth continues to grow in the region of 5%, consistently with what we discussed a couple of months ago at the Capital Markets Day in line with our start in this respect. Things change in terms of mix in our well-diversified portfolio of geographies, businesses helped us achieve this resilient underlying growth. In this context, EBITDA also grew 2.6% in the quarter, and we continue to have margin expansion, which we'll see in a moment.

In the first quarter of this year, we continue to work to shape Nexi continue to grow profitably in the future. Our strategic initiatives, which we discussed back in March continue to deliver and are on track, in particular, on ISVs and direct channels, we continue to grow. And we have strong commercial momentum in e-commerce and the front book in Germany and the DACH region, which as you know, we consider to be a very important growth engine in our group.

In the process, we continue to create value for all our stakeholders and shareholders. We are couple of weeks away from paying our second dividend of EUR 0.30 per share dividend, an increase of 20% compared to last year when we paid EUR 0.25 total distribution of EUR 350 million. And in this context, we continue to delever. We're now at 2.5x net financial debt to EBITDA down from 2.6 at year-end.

In the process, we have also started to reduce gross debt. We reimbursed about EUR 1 billion of maturities including what we reimbursed in April with available cash balances, we can also speak of that later on. Before handing the floor over to Piergiorgio, who will give us more details with regards to the quarterly financial performance, I'm on Slide 4 now, I'd just like to take a few moments to recap and discuss a few points with regards to the fact that clearly, this is my first quarterly call as CEO of Nexi, a position I took over just over a month ago. And clearly, I'm not new to the company. I presented together with Paolo back in March at our Capital Markets Day, but I would like to reiterate some of the points we made during the course of the Capital Markets presentation, but also introduce, let's say, the way I view my role in the job and what I seek to achieve going forward.

Some things don't change. I believe Nexi is a compelling equity story. I hope I have put cash where my mouth is. I bought stock over time, I have invested in Nexi stock, more than 100% of the bonuses, the cash bonuses I received over the last 3 or 4 years. And I believe it's a very attractive financial investment. Based on our strong unique positioning, I've tried to recap here some of the things we've said over time, believe we combine in a unique fashion European scale and have very strong local presence, characteristics, I believe, are essential to be successful in Europe. I believe we are a critical European infrastructure. Actually to put more appropriately, we are not the infrastructure.

The infrastructure is composed by central banks, banks, market players like large customers, smaller customers, cardholders, other regulator schemes. We're at the heart of all of this, we are very central to a very complex ecosystem of payments in Europe. And it's hard -- very hard to think of us as something which can be displaced from this position. We have a very diversified portfolio of products diversified across geographies and customers, helping us deliver that resilient underlying performance.

And we've spoken about the difference between underlying and report and we'll come back to that. and we have very attractive exposure to some local MS segments, which will deliver top line growth sustainably in the future. From a financial perspective, we've also discussed this. I think we possess some characters most characteristics that you can find in many other payment companies, I think what makes us unique is the fact that you have them all under 1 roof at Nexi. We continue to deliver sustainable, profitable growth. We have a very predictable, resilient cash flow and cash generation. We have now, over the last couple of years, distributed a significant amount of capital, close to EUR 1.5 billion, including the dividend, which will be paid on May 20th. And our credit profile has significantly improved over time.

We're now investment-grade and a repeat issuer in investment-grade market. However, we need a clearer roadmap, I think, to close this valuation gap. And I see a lot of, let's say, a big part of my role is aimed at closing this valuation gap between what I least perceive and my colleagues perceived to be the intrinsic and true value in Nexi and what the market believes it to be. And I think I've highlighted here on the slide, just 3 of the main areas where I believe we need to focus on in order to bridge this gap. We need to build a credible path towards our mid-single-digit revenue growth target, which we have highlighted in the Capital Markets Day.

And this essentially, I think this gap between reported and underlying, we tried to make the point has to do with certain things which happened back in the day, and we are reabsorbing over last year, this year next year, unfortunately. But we need to win your heart and your conviction with regards to our ability to compete successfully in the long term with new entrants, and that's what we discussed in terms of our ISV strategy, our direct sales force, which as I said, is delivering the kind of results we're expecting.

It will obviously take time prove the point, but we're patient continue investing in the space and continuing to deliver the results associated with it. We need to prove the resilience and the nature of our business and being able to work with sophisticated partners like banks, in particular, in Italy, we need to strengthen our relationship with them. The vast majority of the gap between underlying and reported performance comes from what broke down at a certain point during the course of '23 and '24, but has since, I think, come a long way and vended and indeed, we highlighted how over the last couple of years, we've had 100% success rate in terms of renewing our partnership with these all important partners in Italy.

Another key concern that I pick up when speaking with you all in the market has been the fact that our structural efficiency, I think it is given to us credit is given to us for having been able to contain costs over time. But I think there might be some skepticism out there with regards to our ability to continue this going forward given the necessary investments to be able to bridge the gap I spoke of on revenues. And here, we need to convince you that our steadfast commitment to cost control and enhanced cost efficiency is something which is structural, and we'll continue to discuss costs, I think, later on.

And One of the things -- one of the areas where I am particularly focused together with my colleagues from the Expo is to be as rigorous as we can be, extremely focused on prioritizing our investments and making sure that we focus on those that create network effects and returns rather than rather than casting the net too wide and be spreading ourselves too thin across products and geographies.

Of course, I think the name of the game here will be in the short term, but even more so in the medium term about AI and how we structure ourselves to be able to adopt AI across geographies across products and services. And this is an extremely fast-changing environment. And indeed, information that we have today, the tools that we have today are different to the ones that we are considering in the days leading up to the Capital Markets Day. And it is a very rapidly changing environment. And I believe together with my team, we need to think very hard as to how we want to structure ourselves to be able to embrace the benefits of AI. And indeed, I think we discussed this back in March. I believe Nexi is positioned in, let's say, in a favorable table space with regards to AI as we benefit from an asymmetry in terms of the kind of disruption, which we can suffer from revenues front, given that most of our acquiring is in store and potentially, this will have more time to adapt to AI than the e-commerce space, which will probably be most impacted by it in the short term whereas we can benefit in the short term and the medium term, much more on the cost front, just thinking of the kind of benefits you have in all software space, which we are obviously a big consumer of.

So AI is clearly critical to our success going forward and something I would expect to be speaking with you over time, a lot more. One of the other things, and I believe I discussed this with my colleagues internally, we are now in a phase in our company's evolution, where we can push back into the local regions, a lot of things, which we are centralizing at the time of our Capital Markets Day back in 2022 in order to gain control of our pan-European platform or the biggest in Europe, relatively complex, a phase which was necessary, and we have now, I think, completed and we can now, I think, improve our time to market and local agility by some organizational simplification, which will be implemented in the coming weeks and months.

And finally, on disciplined capital allocation, not so much the fact that we're distributing capital. I think that's a fact, and you can -- we will be able to test it over time, the fact that we have the dividend policy which we expect to stick to, so a dividend which will be paid every year and growing over time as we've discussed in the past. Again, here, I think we've had picked up at least in some conversations, some concerns with regards to leverage, it is coming down, but it's still substantial, but it will continue to come down given the cash generation going forward.

I hope it gives you comfort that we are paying down our gross debt. As I said, EUR 1 billion now in March -- March and April, apologies. We have about EUR 1.8 billion, EUR 1.9 billion of cash sitting on our balance sheet and that will be used to -- or has already started to be used to pay down that EUR 1 billion of debt. We now have a EUR 350 million dividend. We are completing or have completed the purchase of a merchant book in Italy for north of EUR 100 million. Next year, we have EUR 0.5 billion convertible coming due in March. And I expect to reimburse and use that EUR 1.8 billion, EUR 1.9 billion of cash to meet these short-term liabilities without having to access capital markets to do so, giving you proof hopefully that, again, cash is there to be used. It's put to its best use in the past it was better to keep the cash on balance because we got a positive carry. That's no longer the case of where it's sorting coming down, so we're paying down gross debt and this will continue going forward. Let me pause here because I've taken up already too much time, I'd like to hand the floor now to Piergiorgio George, and then we'll come back and take Q&A at the end of the presentation. Piergiorgio?

Thank you, Bernardo. And again, good morning, everyone, and thank you for joining us today. Before we turn to the results, I would like to take just a moment to briefly introduce myself as this is my first call with U.S. Nexi CFO. I'm really pleased to take on this role, and I'd like to thank the Board and Bernardo for their trust. I'm excited about this opportunity. I'm very proud to be joining Nexi. Over the past few weeks, I have had a chance to get to another company more closely and what has struck me most is the quality of the people, the strength of the platform and the strategic advances of Nexi as an orchestrator and infrastructure provider within the complex and essential European payment ecosystem.

This is a totally strong organization with a clear purpose and a very talented team. While I come from a completely different industry background, I believe this allows me -- this will allow me to bring fresh perspective. My focus will be on working closely with Bernardo and the leadership team to ensure cost discipline, strong execution and constructive challenge by supporting Nexi long-term value creation for all of our stakeholders.

Turning now to Q1 results, I would frame the discussion around 3 key messages: First, growth remains solid, supported by healthy underlying trends, as we've just heard from Bernardo despite temporary and known headwinds as we discussed during the very recent Capital Markets Day; Second, our diversification continues to provide resilience across both businesses and geographies; and third, we are executing with discipline on costs supporting margin and excess cash generation.

We remind -- let me start with the performance of the group in the first quarter. Overall, we started the year with a resilient performance with solid underlying growth and sound profitability, despite the expected impact of external headwinds on net revenues related to the bank contract effects across both merchant solutions and issuing solutions. Starting with the top line, net revenue grew by 1% year-on-year to about EUR 821 million, broadly in line with our expectations. And consistent with the back-end loaded growth profile we outlined on our recent CMD. It is important to highlight that the underlying growth was around 5%.

Looking at the top line in more detail, all businesses contributed positively on an underlying basis with solid volume across both merchant and issuing activities, supported by continued structural tailwinds such as digitalization of payments and increasing penetration across our markets.

Turning to profitability. EBITDA reached approximately EUR 397 million, up 2.6% year-on-year, with an EBITDA margin at 48.3% supported by disciplined cost execution and some favorable phasing in the quarter, which I will comment in a while.

In general, Q1 confirms the resilience of our business model with diversification across both businesses and geographies playing a key role in supporting performance and enabling continued delivery of profitable growth.

Let me now turn to Merchant Solutions, where most of the temporary headwinds are concentrated. In MS, revenue was down 1.4% year-on-year, which is broadly consistent with our expectations entering the quarter. The decline is primarily driven, as we know, by bank rated assets in Italy, including loan outflows and contract renegotiation, which had a material impact on the year-on-year comparison and by timing of specific projects compared to last year.

Let me remind you guys that about 25% of our MS revenues are not driven by volumes. H2 '26 will show a reduced impact of the bank content effect, which combined with additional traction we will get from our strategic commercial initiatives, will lead to a growth acceleration in the second half of the year, as discussed during the CMD. However, when we look at the underlying performance, revenues grew by about 3% year-on-year, which is consistent with the underlying volume trends.

On volumes, we saw continued growth in the number of managed transactions supported by processing activities, which benefited from the ramp-up of [indiscernible] processing pub consolidation in Italy. This is an important development to us as it further strengthens our positioning as an infrastructure provider with the domestic within the domestic payment ecosystem. At the same time, towards the end of the quarter, we observed some softness in consumer spending, particularly in Germany and Nordics, which had a limited impact on volumes. From a commercial standpoint, we are seeing encouraging signals coming from all of our growth initiatives discussed during the CMD. I see that channels and e-commerce, in particular, in Italy are contributing positively with good commercial momentum in Germany and across geographies.

Let me now move to issuing solutions. In issuing, we delivered a strong performance with the revenues increasing by almost 5% year-on-year despite the expected negative impact from bank-related effects. Important to notice unlike Merchant Solutions, this bank-related effects are expected to increase in the second half of the year. And therefore, we expect the full year growth of this business to be closer to low single digit in line with what we outlined in the CMD.

Looking at the underlying drivers, the performance was primarily supported by strong volume growth with the value of managed transaction increasing by more than 7% year-on-year. Growth was driven by both international and domestic scheme, including the continued ramp-up of Banco [indiscernible] in Italy. In addition, we benefited from the completion of a new client on-boarding in DACH, which contributed to the performance of the quarter. We also saw a positive impact from business initiatives, including international [indiscernible] in Italy and the increasing penetration of value-added services across client portfolios. Finally, part of the performance in the quarter was supported by favorable phasing of certain project initiatives. Let me remind you once again that almost 50% of the revenues of this business line are not volume driven. Overall, issuing continues to represent a structurally sound business supporting Nexi profitable growth.

Moving now to DBS. DBS delivered solid and consistent performance with revenues up 2.8% year-on-year. Growth in this segment was supported by both volume dynamics and the contribution of new initiatives and projects. In particular, we continue to see good traction in core infrastructure services such as CEPA, clearing and network services, which represent a key pillar for this business. We also made further progress on strategic initiatives, including new account-to-account solutions, such as [indiscernible] for Irish banks and verification of pay services launched last October and now impacting hundreds of banks across Europe.

As a reminder, DBS is structurally even more exposed to project-based revenues compared to the other 2 business lines. And in Q1, we enjoyed some favorable phasing. Moving now to the next slide. Let me comment on performance across geographies where our diversification continues to be a key strength, allowing us to offset localized headwinds with growth in our regions. Starting with Italy, which is the region most impacted by bank contract effects, revenue were broadly stable. Headwinds, especially in Merchant Solutions, driven by these effects were partially offset by continued growth in issuing solutions and DBS. In the Nordics, revenues were slightly down year-on-year, mainly due to maturation of the major issuing client at the end of 2025, as we discussed a few times in the past as well as somewhat softer macro conditions.

Importantly, underlying trends remain positive, and we continue to see growth in value-added services and on e-commerce key propositions. DACH delivered strong year-on-year growth, particularly in Germany. This was driven by solid volume dynamics and the completion of a new client on-boarding admission solutions. Despite the macro environment that remains somewhat challenging in terms of consumer spending, especially in the hospitality sector. [indiscernible] revenue grew at mid-single-digit pace supported by volume growth and installed base expansion.

Finally, let me turn to cost performance. On the cost side, we delivered a solid performance, reflecting our continued focus on efficiency and disciplined cost control. Going back to what Bernardo just said a few minutes ago, total operating costs were flattish compared to last year with approximately EUR 425 million. This result was achieved despite ongoing inflationary pressure and continued investment in key strategic areas, in line with what we outlined during the CMD.

Looking at the cost components. Personnel cost increased by approximately 4% year-on-year, reflecting inflation, salary adjustment and the carryover of hiring initiatives starting in 2025 and continued into Q1 aimed at supporting our strategic priorities, as we know, ISVs and direct sales to name a few. At the same time, operating cost decreased, largely driven by efficiencies, also enabled by deployment of the initiatives across the entire organization as well as favorable in the quarter. It's important to highlight that the part of the cost performance at this point in Q1 reflects this timing effects. And as such, we would expect cost to increase over the coming quarters, both for personnel and operating costs.

At the same time, we continue to see structural improvement from our ongoing efficiency program some of which as I said, are enabled by AI initiatives, which support our ability to manage the cost base with discipline. Overall, these are enforcing our commitment to balancing growth investments with rigorous cost control, supporting the delivery of our EBITDA and excess cash guidance for the year.

Finally, we confirm our 2026 guidance with net revenues growth broadly in line with what we saw in 2025. EBITDA in absolute amount, broadly stable and excess cash generation of EUR 750 million. With that, we can start the Q&A session.

[Operator Instructions]

The first question is from Grégoire Hermann from Barclays.

Maybe the first one would be on EBITDA. So you are keeping your guidance changed despite a growing EBITDA in Q1 already. Can you be a bit more precise on your phasing of the cost plan for the rest of the year? And do you see upside basically to your EBITDA or should we expect some more pressure in -- for the rest of the year?

And then maybe more on the Merchant Services performance. Can you clarify a bit the moving parts, please? Because it seems like the performance in Q1 has been a bit tougher than expected. Is this only due to bank M&A? Or if I look at underlying growth, it seems like it's decelerating a bit. And despite that, you maintain your guide for reacceleration. Can you tell us when you expect an inflection point? And also how this is going to face for the rest of the year, please?

Thanks for the question. This is Piergiorgio speaking. So in terms of EBITDA as I said, we confirm our EBITDA in absolute terms similar to what we saw in 2025. That's the guidance, which means since we also confirm the growth of the top line, if you do some kind of reverse engineering, you would see that our expectations is that the cost base is going to grow to go by approximately again, ballpark number, 5% to 6% right? So yes, the short answer is we do expect the cost base to increase in the year to go compared to what we had in Q1. And this is mainly driven by 2 factors. We will keep on investing in the -- all those initiatives, which we have signed strategic during the Capital Market Day. And then we all set some positive phasing in Q1 that we're not expecting to see in the rest of the year. Nevertheless, our commitment, as I said, to a very disciplined cost control and cost management. [indiscernible] It's not just an auto myself, the entire leadership team is there to deliver what we've committed to.

In terms of MS phasing, I believe what we said also in the Capital Market Day is that we expect an acceleration in the second part of the year in H2 basically for 2 reasons: One, because we will see the initiatives that we're working on, IDS direct sales channel, e-com, all the growth engine we have discussed about during the Capital Market Day, gaining momentum in the second part of the year. And then also, if you look at what we call market risk, you would see that in the second part of 2025, that the impact of market [indiscernible] DMS was higher than what we expect in the second part of 2026, which is going to add to our growth year-over-year.

Lastly, I believe your question was about the underlying growth. I believe what we see there, if you break down the growth and the sales of among the volume-driven components and the non-volume-driven components, you would see that 25-ish percent or so of the revenues of MS are non-volume whereas last year, if you go back and look at Q1 '25, you will see that we had a bigger impact of non-volume-driven components in the MS sales. So year-on-year, just because of phasing of projects we have a negative impact that if you do the math and reverse engineer on the numbers, you would see is around EUR 10 million, EUR 11 million to give up that ballpark, which is what [indiscernible]. We have a phasing with a mix effect there because a part of the volume growth has been driven, and we are very proud of it by the Banco [indiscernible] had in Italy, which speaks about the fact that we are really at the center, let me say, of the payment infrastructure as Bernardo was saying at the beginning of the call.

And then we saw, especially at the end of the quarter, as I believe we discussed during my remarks that we saw some headwinds on consumer spending, and that is especially true for hospitality sectors in Germany in our Nordics geography and especially in Denmark. So all of this combined give us confidence that in the following few quarters and especially so in H2, MS will see an acceleration in its growth.

The next question is from Hannes Leitner from Jefferies.

Congrats to both for your new roles within Nexi. Maybe we can just drill down on the underlying metrics. When you say on group level, it was 5% underlying, but then when we look on Merchant Services and we calculate those numbers, it equates to EUR 20 million [indiscernible] service headwinds, while on group, it's EUR 40 million, so maybe we can just like to get that down? And then also, what would have the Nordics grown on underlying metrics if you look for the Nordea expected be a ramp down. So that would be the first question.

And the second question is maybe just 1 more -- a little bit more high level. Your -- the European peer seems to have fixed [indiscernible] structure for the moment. Do you see -- what do you see in terms of pricing in the market on the SMB side? Has it been becoming more aggressive? There is also a handful of challenges which seem to be very active in Italy, but also in Germany and in other markets. So maybe you can talk a little bit about regional differences, competitive pressure because you have talked quite a lot about SV channel and then the banking channel, which is probably a little bit more particulate even those contracts have longer maturity [indiscernible].

Thanks, Hannes. Let me try and answer these questions and Piergiorgio can obviously chip in [indiscernible] way. Thanks for your opening remarks. In terms of the underlying profitability, I think your math is more or less right in terms of, I think, the exact numbers on the math is below EUR 20 million but close to EUR 20 million, and as a group, it's actually closer -- it's actually EUR 30 million rather than EUR 40 million, but this is so on and so forth. It doesn't change the point that you're making.

And clearly, the biggest contributor to the gap between underlying and reported does come from MS and it does come from Italy, it does come from bank -- banks that we lost, and we know the name of the banks who discussed them. In the past and as Piergiorgio was saying, we expect that to revert in the second half on MS. But as we discussed back in March, we then have the second leg of this migration of this customer, which used to be a customer both an issue and acquiring. So we will digest have lapped in the second half of this year, the exit of the Merchant Solutions, and that's when we expect the rig to start to kick in, which will feed into next year. The rest of the market risk comes from market customers loss comes from issuing as we discussed. The biggest contributor to this, I believe, is that Nordic customer, which we've also discussed and if you normalize the Nordic port, which in our slightly negative in terms of top line growth, on issuing would be slightly positive. It's low single digit as we expect, given the nature of that business.

There's also another factor which you should -- we should bear in mind and we mentioned it, I think, back at the Capital Markets Day with regards to the gross buy rates on e-commerce and some of the physical channel as well. We are normalizing year-on-year for that. We discussed that in the Capital Markets Day. But last year, in the final quarter, I think there was a couple -- a bit of that in the fourth quarter, which basically hits us in the first quarter this year, but not in the first quarter of last year for migration issues from -- not material, overall, but that if you normalize for these 2 things, the Nordics would actually be slightly positive, both in terms of growth the Merchant Solutions and on issuing.

So I'm actually quite happy with that. Notwithstanding all the phenomena we've discussed in the past of competition, which moves to your third question. I didn't quite get the reference to our competitors, but in general, I understand it was about price competition coming from new entrants and in general competition. And as you correctly pointed out, we have quite a diverse set of distribution channels in Italy, Greece, Croatia, we distribute primarily to banks, even though there's obviously a convergence of software and payments, which speaks to the entry revised fees and so on and so forth and the need to address market also through direct sales channels in the Nordics and Germany, Poland, et cetera, we go direct to merchants.

Nonetheless, we suffer from competition in all these channels. And I would say as you correctly pointed out, we're lucky enough to have, let's say, a strong distribution partner in banks in Italy, Croatia and Greece, which help preserve margins. They have a strong cloud and their merchants, notwithstanding concern that as payments become more technological ISVs will take away market share from the banks, and we are accompanying the banks and being able to distribute the product, the more technological product, thanks to work on integration with their distribution channel and with ISVs. And we've also developed our own distribution channel, either direct or in partnership with ISVs, all of which is trying to accompany this migration, which is happening towards a more direct distribution channel, which has, as you correctly pointed out, overall, a net lower take rate than the back book.

But this has been the case for the last 10 years, at least since I've been the next and we expect this trend to continue. I don't see any big discontinuity. There is no I mean some of the competitors you often mention and talk about and ask about are not competing on price in terms of dumping. They are just formidable competitors in terms of their product, they're on-boarding, et cetera and we just need to improve and bring our game to their level where it isn't the time it's better to compete with them. And all of this is reflected both in our actual numbers and the forecast we've given. So I wouldn't say there's anything different in this quarter compared to 2 months ago, the Capital Markets Day compared to November when we had the third quarter call and so on and so forth.

The next question is from Sébastien Sztabowicz from Kepler Cheuvreux.

I've got one on the Q2 trends or the volume trend in the start of the quarter because in Q1, you had this positive phasing effect. Could you quantify a little bit the impact on your revenue notably on the issuing side that was apparently will be strong. And then you are talking about some softening consumer spending in Germany and Nordics. Could you elaborate a little bit on the trend entering Q2. The second question is on MS. When I'm looking at the take rate evolution in Q1, the take rate is declining year-on-year quite substantially. I was wondering what was the reason behind that? It is linked to our decline of big project in Q1? Or can you elaborate a little bit on the take rate in MS.

Thanks, Sébastien. I think if I look at the April numbers, I mean, saying that there's no big difference in what we've seen in April compared to what we saw in the first quarter, and it's very hard to glean anything into any one monthly performance for the rest of the year. I think it's hard to really say that, I don't know, the war in Iran or what's going on in the Ukraine and the Middle East has had any meaningful impact on us. For sure, the overall environment, the overall macro environment is not -- we're not in a booming environment, and we've spoken about this in the past about how it is hitting previously more so the Nordics than anywhere else and previously more so Finland than anywhere else for Sweden.

Now it's really more in Germany, the issue, which is what I think the judge was referring to when we spoke of earlier with downward revisions in terms of consumer spend, in terms of real GDP growth and nominal. So I think April first quarter and beginning of second quarter, no big changes, I would say. Hard to say if you look forward and you asked me about the summer and how is -- what's going on in the Far East or in the Persian Gulf and et cetera, how will that impact travel given what's -- what we read in the press on jet fuel and that kind of stuff. The truth is I have no idea. I don't think anyone on this call can really make a certain call as to how that's going to impact us. What I would go back to is that we have a pretty diversified and well hedged kind of business, both in terms of geographies, in terms of products, in terms of volume and installment or subscription-like revenues, which help us mitigate spikes and troughs in this sense.

Going on to the take rate, you're right, we dropped like I think it was 1 basis point or so from 23.5% to 22.5% or something along those lines, which is, honestly, just given the very approximate measure of the profitability, which is calculated this way, i.e. total revenues divided by total volumes, where there's a lot of non-volume-related revenues and revenues. It's very hard to make any precise judgment.

This is not the function of kind of wild swing of mix from a higher profitability product region channel to a lower one. It's the compounding of a number of effects. For sure, I think the Gogo mentioned the impact in terms of volumes and we're seeing more domestic scheme volumes in Italy, these are lower profitability. So that does speak in that respect to a kind of mix effect, but there's also seasonality. I mean we have -- when you actually implement value-added services repricing tends to be maybe not in the first part of the year, maybe in the summer and later on, and this would affect it.

So just like we don't give guidance on a quarterly basis, but look at the -- and manage our P&L, at least on a yearly basis, if not multiyear basis, given the nature of our business. I caution you also not to read too much into a quarterly swing, so there's nothing specific you should worry about it. We point to a broad stability of the take rate, which is our medium-term target.

And on the phasing effect in the issuing was it very big in Q1, just to understand the dynamic enter in Q2 for [ showing ].

Yes. As we said, we had that I think you shouldn't worry about project work and stuff like that, which probably was, for instance. We had [indiscernible] was bought by BP, right? They need to migrate on what was, I think, 13th, 14th of April, they migrated their book from [indiscernible] under deeper and we earn money by helping them and do so. This will be booked in the second quarter last year, in the first quarter, we would have had other project work maybe related to some other customers. So there will be a bit of that. But I think the most important thing that you should think of, an issue is what we discussed earlier about the big banks that we -- the big bank single that we lost. They will start migrating. Its car portfolio has started, but it will pick up in the coming months from us to our competitors. That is the real impact in the second quarter and second half of the year on issuing.

The next question is from Justin Forsythe of UBS.

And congrats to Bernardo as well as Piergiorgio for the new roles. Thank for having me here. A few questions, if I might. So Piergiorgio, I just want to come back to this underlying growth and make sure we move -- understand the moving components correctly. So if I understand it, you're talking a little bit about the project-related benefits that were in the prior year base in Merchant Solutions. Was that EUR 10 million or EUR 11 million impact on that aspect of the business specifically? And if you normalize for that, you would have been closer to the underlying growth. I understand you flagged a smidge of weakness coming out of March, which wouldn't have really moved the needle as you said, the relative moving pieces to get you from underlying MS through 4Q to 1Q and also the fact that the underlying transaction volumes and MS remained quite steady.

And then, I guess, Bernardo, you mentioned a little bit around the take rate of domestic schemes relative to international schemes, maybe that played a role as well. And then I just wanted to hone in a little bit on the macro. Totally appreciate all the comments that you've just made around not really seeing anything. I guess it feels like a lot of investors are fearful of luxury related spend levels and inbound tourism, so second derivative type of spend off of travel.

I would have thought that, that was something that maybe would be impacted. It sounds like you're not seeing that at all or very minimally, say, in Italy, but maybe you could put a finer point on that. And just 1 point on the positive offsets, maybe you could give us some detail on -- or remind us on the percentage of your mix exposed to fuel, meaning processing payments for gas stations like E&I and others in the portfolio? And then just one final one. I wanted to understand a little bit more around the Banco [indiscernible] Hub in Italy, I mean, you mentioned it a few different times. Does this have to do with the modernization efforts at Bancomat. Are you seeing that across all of your business lines? Like maybe you could quantify a little bit the benefit you expect to see from that going forward?

Sorry, Justin, we're just giving up your many questions thanks for your opening remarks as well. Let me just quickly talk about take rate macro effect on tourism, luxury spend, that kind of stuff in the banco [indiscernible]. The banco [indiscernible] and the take rate comment I was making earlier is actually are tied to one another. We do a number of things for banco -- or for banco [indiscernible]banca, we are basically the sole provider of IT. So Banco this a scheme, and we do processing of that scheme on issuing and acquiring 100% of it.

And this has been consolidated on to our hub over time when Bancomat went through its own transformation and had these top 3 processors now there's only 1 and we are that one. So we are bringing on board volumes that previously were processed by other processors. And this feeds into the take rate discussion as mentioned earlier. So we have better volumes because we're now processing more volumes on a largely kind of fixed kind of revenue base with backlog is actually not that fixed because it's growing, but you understand what I mean, the take rate on that processing volume is much, much lower pure processing. But the volume uplift is pretty big, and that dilutes, let's say, the take rate in this quarter.

So with regards to Bancomat, yes, it is what you're suggesting, i.e., the upgrade in technology back on now offers a number of features they've been used to offer and has ambitions to do more. And just like we do this kind of work for Bancomat in Italy, we are obviously present in more than 1 European jurisdiction. We do the same kind of growth for our customers, whether they be schemes or customers in other countries as well, so helping them upgrade their technology to new requirements.

On the macro effect, I mean you're right. I mean -- and I mentioned it, I hope I was, I think, transparent and honest about it. We don't have a clear answer to your question, how is what's going on in the Middle East going to impact us in terms of tourism over the course of the summer. I haven't had any evidence that there have been huge levels of cancellations or anything in that respect in terms of some of the countries, which is most impacted by by tourism for us. So our home market here in Italy and in [indiscernible] anecdotally, we're trying to book a Board meeting enrollment we can't find a free hotel to do it. Now I don't know whether it's from the U.S. or European tourists, but that doesn't seem to have fed through yet, but we'll need to see. In terms of the kind of pure Middle East volumes in -- that the impact us. We're talking a a fraction of a percentage point in terms of volumes, right?

The overall kind of extra EU kind of volumes are less than 10% in total. So obviously, we'll be meaningful if they were to be 0 as they did during COVID, but I don't expect that to happen even though the jury is still out. On the luxury front, please bear in mind that, that is kind of especially if you're thinking of some of the more global luxury brands, et cetera, is where we compete less well, if you want. And so where we would lose out less because some of our competitors, 1 in particular is not a monopolist, but has a big share of that market. It's not where we compete the most. So overall, I'm pretty -- I mean, I'm not overly worried about it yet, but this is based on the current set of information. We'll see going forward, if things change.

You asked about the gas distribution. So I can say that the Italian company -- the largest Italian company in the space accounts for about, I'd say, EUR 10 million or so of annual revenues, and it's very diversified across the board. Obviously, driven primarily by refueling of the station, but it's not just the commission we earn on the fuel. It's also all kinds of things we charge them for including running their loyalty scheme or the e-commerce gateway they have and so on and so forth.

So not 100% of that revenue is generated from what you actually end up seeing even though people might travel less, they spend more for the fuel they're paying. And therefore, ultimately, in terms of value of transaction, we'll probably less liters of fuel being sold, but the value of the transactions probably will remain similar has been in the past, so I don't expect that to impact us materially.

Let me hand the floor over to Piergiorgio to answer your question on underlying versus reported.

Yes. Thank you, Bernardo. I believe if you go back and look at what we reported in Q2 '25. I believe we have a very nice slide in our deck where we say how much of the revenue is volume driven and how much is non-volume driven. You would see that in Q1 '25, 27%, 28% of the top of my head of MS revenues were non-volume driven. Whereas what we are seeing in Q1 '26 is a 25-ish percent, again off the top of my head. So if you the math on MS revenues, you would see that the difference between the two quarter is around -- I don't know, EUR 10 million -- EUR 10 million, I think, that time I did the calculation, which is the phasing effect that was discussing about.

So once you strip it out and you try to understand and to compare the value of an transaction vis-a-vis how our performance is going on the part of the MSA revenue, which is volume driven. You are almost there and what you see as a difference basically is due once again national scheme growth, which Bernardo just commented, right? I believe we also made a few comments on how we get remunerated from those transactions. And that is explaining, I would say, a big chunk of that variance.

Got it. That's incredibly helpful both. Just one quick clarifier on the project-related stuff. I thought that was mostly on the issuing side. So maybe you could just provide an example of the type of project work that you do on the merchant side?

On the merchant side, it's primarily with [indiscernible] customers, and it can be many things within that space, not volume-driven to low end to accept new schemes, I don't know, to their gateway on the e-commerce front, might be with a bank in terms of some development for the banks. I mean it's smaller. It's not like the bigger projects, as you were -- as we were mentioning, are related to -- tend to be related to bank M&A on the issuing front, indeed, and that's somewhere in the region of between EUR 5 million and EUR 10 million. Whereas on the Merchant Solutions, it's much smaller, and it's much more polarized.

The next question is from Pavan Daswani of Citi.

I got a couple. Firstly, on the guidance assumptions. You flat seen some make consumer pockets that kept the guidance unchanged. Could you talk about the macro assumptions that are baked into your full year guidance? And also just remind us of your revenue exposure traveled -- sorry, if I missed that number. And then secondly, Germany continues to grow well despite the softer consumer trends that you touched on. Can you talk a bit about what's driving that and the sustainability of that growth looking forward?

Thanks, Pavan. I mean the guidance is unchanged. And as I said, we're just in the first quarter of the year. And just to be clear, the guidance is unchanged, but Piergiorgio and myself, the rest of the team, we're all working to do better than your expectations and and hopefully will succeed. And I would say the first quarter of the year started off well, in particular, on costs.

So hopefully, we will over-deliver. The underlying assumptions on this are, I would say, the ones I think we discussed them briefly about our Capital Markets Day, but we believe to be conservative. However, to be fair, if you look at the macro forecast today, by international agencies, they're slightly worse than they were only a couple of months ago. for the year and looking forward.

In particular, I think the biggest swing, I noticed was in Germany, as we have pointed out. And indeed, when you go to Germany, you do read about layoffs and bankruptcies and the likes. So I would say the environment is slightly worse than what we were baking into our baking into our guidance. But it doesn't need me to say that so material that I would like to change it. So I would stick to that. And then again, let's see what happens in the Gulf because every day in the past is you get a new piece of news.

As things stand, I go back to what I was discussing when Justin asked the question. With regards to Germany, we -- I think just simply put, the way I think of it and the way we always think about it here is when you are in a market like Italy or Denmark where you're the incumbent player in order just to maintain that market share you have, you need to win 50% plus or whatever your market share is of new RFPs, new contracts, and it's incredibly hard to increase your market share. And indeed, we are suffering some erosion of it coming from new competition. And we have the exact opposite situation in countries like Germany, where we start from a 10% market share.

If I win 11% of RFPs out there and already increasing my market share, it's a lot easier. And this is off the back of a lot of work we put into having the right products, the right leadership, tells is on board has been on board now for a year, and he's doing a great job in terms of driving the sales effort in Germany. And to be fair, that 12% growth you've seen in the quarter is not 100% MS. A lot of it or part of it at least comes from ramping up and issuing customer we won back in the day in Germany is now coming into full swing.

So there's some benefit there. However, we are growing more than the market, which means we are winning market share, thanks to our sales effort across the channels, in particular, I think the ISV channel and partner channel in Germany is actually growing very substantially off a very small base, but very substantially. But our direct sales force is doing well, and our products are such that we can win in the market. In Germany, by the way, we also have a pretty full kind of spectrum of offerings. We also own a company called Orderbird, which is a native ISV in the restaurant space. We bought last year, [indiscernible], which is the largest gateway. All of these things contribute to success in Germany. Let me hand the floor over to Piergiorgio with regards to travel.

Yes. Yes. Thank you, Bernardo, and thanks for the question. So you have different exposures across different geographies, obviously, but if you want to take a ballpark number, I would say, 10%, 15% of our MS revenues are exposed to travels. Very difficult to say how much of that is domestic in a sense how much is international. So it's it's very difficult if you are trying to correlate that to what is going to happen is because what we are seeing in the Persian Gulf, we will see some headwind in terms of vacations and people moving around. But long story short, ballpark number 10-ish percent of our MS revenues are linked to travel and transportations.

I think it's fair -- it's early to say just to go back to this question, Pavan, that 10% to 15% includes also taxis, mobility, all kinds of things, so it's not just the flight from Dubai to roll, which everyone's worried about.

Thanks. Shall we move on to the next question.

The next question is from Alexandre Faure, BNP Paribas.

I've got a couple of questions, please. Firstly, on the change in net debt in Q1, which I know is not a great proxy to excess cash generation, I think you had a earn-out payment in the quarter relating to the Alpha acquisition. Could you just remind us of how much that was? And second question is going back to the latter part of your introductory remarks, Bernardo, when you talked about capital allocation, and you mentioned the EUR 1.9 billion of gross cash at the end of Q1 and paying down the upcoming maturities in April paying the dividend in the 2027 maturities as well. I mean, if I do a very rough back of the envelope calculation, it felt like you and 2027, we say, EUR 1 billion to EUR 1.1 billion in gross cash. Is it how you think about the minimum operating cash that Nexi needs or you could pay that further down?

I'm not sure what was 100% of your math, but let me try and answer what I think is what you're trying to get to. I mean let's start with the detailed questions you asked about the earn-out. And we have paid -- I think in total this year, it's between EUR 20 million and EUR 30 million tied to the acquisition of the Alpha Bank book back in 2021 or '22 if I remember correctly, and that was obviously -- part of it was paid -- most of it was paid, I would say, in the first quarter, and there's another payment, I think, in the second half, a smaller amount payable in the second half. But in total, between EUR 20 million and EUR 30 million depending, I can get back to you with the precise number. But in general, if you look at the dynamics of our net debt or cash generation as follows, clearly, first point, the gross debt includes also noncash, let's say, debt nonfinancial debt, so IFRS and the likes, which increased in the first quarter, which you should strip out if you're trying to figure out how much cash you generated in the quarter.

We paid down part of that 957, 967 was paid actually in March. It was a long from, if I remember correctly, CDP, yes. So part of that fed into it. So there's a few moving parts that you should consider within the quarter. But the way I look at our cash base, and I made the point in my opening remarks, think of that EUR 1.9 billion that we have on balance sheet now that is going to serve more than EUR 2 billion of payables, which come due between now and next year, this time next year. So EUR 1.5 billion of gross indebtedness to be paid down. The dividend this year, the M&A, the earn-outs and so on and so forth. And we can do that without having to tap capital markets. And I hope that gives you kind of comfort that the cash, which is there's 100% available, none of it is trapped, et cetera. Then we have to deal with the mechanics of how we actually get the cash to pay the debt or pay the earn-out, et cetera. And the easiest way is to wait for dividends to be paid up by the subsidiaries to Nexi as a parent company. Nexi is a parent company, only needs cash to pay salaries for the few people that are employed by Nexi and pay the coupons on the dividend. So Nexi is a parent company only needs a few hundred million euros of cash on its balance sheet and then every operating company needs some cash to manage salaries and so on and so forth.

My estimate, we don't have a precise figure is less than EUR 0.5 billion at any given time. Why do we run more cash timing? When is it the right time to tap capital markets to issue a bond bridge that with some back loan between now and when the market opens. And it's just pure treasury management. So I hope that answers your question.

The next question is from Aditya Buddhavarapu from Bank of America.

Three from my side. So firstly, can you just talk on the plan you're seeing in Central and Europe, so you mentioned there some unfavorable volume mix and pricing consequent if you just expand on that? Second, you've talked about expanding the direct sales force, [indiscernible] and other market [indiscernible], can you just maybe talk about how that's progressing year-to-date and maybe the phasing of that during the year as I think about the cost line. And then finally, as you think about the portfolio overall, [indiscernible] across all 3 segments, is there anything that you still think of non-core. I mean part of DBS maybe, but any other parts of maybe MS sorting as well, which you think could be less strategic going forward?

Let me answer the portfolio rationalization and direct sales force, and I'll hand the floor on the details of what went on in Poland in terms of mix, et cetera, to Piergiorgio. So on the portfolio rationalization, so we came to the conclusion at the end of last year that we weren't going to sell DBS. And indeed, going forward, I think also given the evolution we see in the payment space, it might have actually been blessing in disguise, given the centrality of the discussion on payment sovereignty Europe and a space we want to really claim in terms of our role as an orchestrator, as a key element of the European payments ecosystem and the role that the DBS complain that in the digital euro in account-to-account payments. and all the like. So I think actually, DBS from being an asset which had attracted attention because of its merits is not an asset that we have and that we intend to grow and invest into digital potential.

And there is also, I would say, reasons why we didn't sell it related to the role Nexi plays within the overall European ecosystem that kind of prevent us from selling that kind of assets. So within DBS, we've always said there are some smaller pieces which are less core, less strategic for us and we might sell. But none of them are so large that you should worry about it as being impactful in terms of our strategy going forward and our results. It's really about just housekeeping for us and simplifying our business. On the direct sales force, we are approximately 500 strong, if I remember correctly, there's a group, about 300 of them are in Italy, Western Germany and Nordics, et cetera. We are planning to more or less double that sales force over the course of our plan period and we are progressing in that direction. I think I wouldn't call it a linear progression, it's more upfronted. But I think that's one of those areas where in trying to manage our P&L during the course of any given year to meet or beat our objectives.

It's one of those areas where I would be more inclined to kind of ring fence them and continue steaming ahead because I believe that's where a lot of value guys. Let me hand the floor over to Piergiorgio on CSC dynamics.

I believe the question was specific from Poland, if I am right. So in Poland, as I believe we said in the past we serve the largest e-com marketplace there and also one of the leading platform overall in Central Europe. We already get a get with services for that customer of ours. So what we are seeing is that in terms of volumes that customer is now starting from 2025 actually because I believe this has been discussed in the past as well open up its offering using different gateways. So we see a volume reduction there. But in terms of impact on revenue, is very minimal because the margins we were making there were pretty low compared to other business we do with different customers. And on top of that, overall in Poland, so this is not specifically to us.

What we see is more customers using local account-to-account schemes. So it's a mix, which everybody in Poland is kind of going through. And since you have this kind of a shift of some volumes to this A2A scheme [indiscernible] account scheme that's going to have an impact, a slight impact on revenues as well. But overall, Poland remains a very strong market for us, and it keeps growing very nicely and according to our expectations.

Next question is from Antonio Gianfrancesco from Intermonte.

Several of my questions already been addressed. So just one from my side. It is on capital allocation because you the guidance, but do not explicitly mention the 5% plus year-on-year dividend growth indication provided at CMD. So it would be helpful to clarify whether that dividend growth framework is also fully [indiscernible] for next year.

Thanks, Antonio. Easy one, yes. And let me just take your question. I think one of the things we said at the Capital Markets Day was that this was a kind of floor that we tend to stick to. So growing dividend by at least 5% every year. But remember that in our projections, we only accounted for -- if you multiply it out, a portion of the excess cash we expect to generate. And we said the remaining excess cash that we expect to generate. So that which isn't distributed as part of the 5% growing dividend over time. We would consider on a year-by-year basis in terms of what to do with it, pay down debt. Maybe there's some super accretive M&A, which today doesn't exist, but might appear, maybe we consider buybacks maybe we distribute a special dividend. So that is the kind of floor, which we are committed to. The Board is committed to. I think it's entirely consistent with the discussions we have with all constituencies, including debt holders and rating agencies to do better.

Okay. Thank you very much, everyone, for your time today, and I look forward to meeting with Piergiorgio and Stefania, many of you over the coming days and weeks. Thank you very much.

Thank you.

[Audio Gap]

into a lot of products initiatives in the latter part of the morning to give substance, to give content to this title to these superstrong conviction that we have. But let me start from where we left it about 3 years ago when we were in this same room for last Capital Market Day. Since then, we've made a lot of progress. We know not necessarily all the progress we wanted to do, but we definitely made a lot of progress in an environment that has been quite articulated, I would say, from the macro point of view, from a market point of view.

Our revenues did grow from EUR 3.1 billion to EUR 3.6 billion. In parallel with that, our EBITDA did grow from EUR 1.6 billion to EUR 1.9 billion, expanding EBITDA margin by 250 basis points. So a very high margin to begin with and with an exceptional EBITDA margin expansion very much at the high end for the sector. Most importantly, we did double the cash that the company is generating from EUR 400 million in 2022 to EUR 800 million last year, generating more than EUR 2 billion over the last 3 years. This has allowed us to reduce very materially leverage from 3.3x to 2.6x and become at the end of 2024 investment grade for our very first time.

And in parallel with that, this cash generation allowed us to start returning capital back to shareholders with our first buyback in '24, our first dividend in '25 for a total of EUR 1.1 billion over the last 3 years. Today, Nexi is an enduring platform, a platform that is here to stay, it is here to succeed in the future. Why? Because it's characterized by 3 key characteristics. The first one, it's a platform that has a strong, unique positioning. Clearly, we are a critical European infrastructure, very entrenched in our local ecosystems. And we always hear about the need for more Europe. We are at the center of that. We can be at the center of that.

And second, together with that, we are a unique combination of our unique scale together with a strong local in-market entrenchment, 2 characteristics that are really necessary, we believe, to succeed at least to succeed in the segments that are the real focus for our company. This strong unique position is combined with high-quality resilient growth that derives from a combination of things. First of all, exposure to a market that will continue to grow and will also expand in terms of opportunities as the complexity of payments evolves. We have a diversified portfolio of products, geographies, customers that is richness for us.

We are focused on the most attractive merchant services segment, and we'll come back to that later on. And last but not least, we drive growth out of our portfolio of defendable large core engines and very attractive accelerating growth engines. And last but not least, when we look at the future, when we think about the new themes emerging in our sector more broadly, for businesses. We are deeply convinced that we have not only resilience, but actually, we see opportunities in this future. For example, payment complexity, growing payment complexity is something that we believe we can leverage and we are already leveraging. But together with it, the hot topic of the day, AI, Gen AI, agentic AI, agentic e-commerce, not only we will leverage on that, we really believe it can be an opportunity for our company.

So an entry platform for this very unique characteristics. Today, we will cover these topics. So we'll start with a session that we'll give you an overview of where we are, how we see the market and our plans for the future. Then we'll have a break, and then we'll have 2 deep dives. First one, how we win in merchant solutions; and second, how we grow value in issuing solutions and value we believe is the real theme in issuing solutions. After that, I come back on stage for a few more minutes of closing remarks, and then we'll have about an hour for your questions, comments, reactions.

Now let me jump in the first session, I will at some point, call on stage Bernardo with me to cover obviously the financial plan and all those aspects. The key messages of these sessions are well summarized on this page. The enduring platform to power cash generation. Why? Because we have a unique position in a growing dynamic market. This unique position is allowing us to have enduring growth from a diversified attractive portfolio. We'll talk about mid-single-digit structural growth here that combined with a continued focus on efficiency, further powered by AI will allow us to continue to have strong cash generation and distribution to shareholders. And this formula will continue for the very long term, thanks to the structural long-term resilience that we will talk about later on.

Now I jump into the first part, the one on who we are today market and our positioning. And here, I would have to ask to those of you that know us well to be a little patient because I will be repeating things that you have heard many times. But we're really doing it for the benefit of the many investors that are newer to Nexi and for them, it's clearly useful to understand first the company and its portfolio of businesses.

So let me go into it. Nexi is very unique for its leadership, for its scale, for its reach, let me just point out, we serve more or less 2 million merchants across our geographies. We serve more or less 140 million cards, and this is giving us many opportunities for growing value, upselling, cross-selling and so on and so forth. Capabilities that make underlying more than 3,000 people dedicated to technology development, product development, future development, with 5 digital factories, we have added that 1 fully dedicated to AI agents development and as a consequence of all of this cash and capital distribution.

The company is operating with a diversified portfolio of solutions for merchants and financial institutions. We are articulated with 3 business units. The first 1 is looking, obviously, at Merchant Solutions, about 57% of our total revenues. And here, we serve in particular, SMEs with corporates and mid-market e-commerce. The second business is issuing solutions, which is about 30% of our revenues. And here, we have the full portfolio of solutions from the more traditional processes, one to the issuing products, which is very unique of Nexi. And last but not least, with about 10% of our revenues, digital banking solutions, where we serve normally financial institutions and corporates across account-to-account, corporate payments, open banking and a few more solutions.

When we look at the presence across our geographies and the characteristics of the presence that we have across our geographies for these business, it's focusing on merchant services and issuing. It is a fairly diversified presence with a mix of leader and challenger position. If we start with Merchant Services, we cover this part of Europe vertically from the top of Norway to the Southeast part of Europe here with Sicily and Greece. We are leaders in Italy. We are leaders in Denmark, Norway and Finland. With challengers, I would say, a little bit everywhere else with slightly different positions, but we have challengers in all of them. We operate very much with banks basically in Italy, Croatia and Greece where everywhere else, our approach to market is only direct and with other type of partners, including ISVs. When it comes to issuing solutions, we have a little bit of a similar picture in issuing solutions. We are leaders in Italy, Norway, Finland, in Denmark, the Baltics as well even though they are very little. We are mainly processor or challenging to serve -- challenger processor in the other geographies. Here, the additional element that's important to always keep in mind is that in Italy, we're not just like the other issuer issuing players because we're actually an issuer ourselves, a co-issuer together with the banks, it's a very successful business model that we are now starting to export into the rest of Europe.

Bringing it all together, our diversified and resilient business, geographical and customer portfolio, business mix, we already covered. Geographical revenue mix, Italy is still more than half of the business. We are happy with that because it's a very attractive basket. So we believe it remains the most attractive market in Europe, Nordics, DACH and CSEE. When it comes to customer concentration, our top customers represent more or less 22% of our revenues. And the very good news is that most of these revenues are already secured for the very long term, and Bernardo will come back to that later on.

Now moving to the market. As you know, as Nexi, we are exposed to the most attractive markets of Europe. In these markets, penetration did grow since last time we met. Today, the average penetration in our markets for digital payments is about 36%. But especially if you focus on DACH, Italy, this is very much below the European average of 46% and very much below the average penetration that you have in the other markets where we are not present, which is at 55%. So yes, penetration grow, but there is a lot of more room for secular growth in our industry and in particular, in our markets. We expect the market to continue to roll penetration by more or less 1 to 1.5 percentage points per year. And these, together with the growth of economy and consumer spending, which is the one that is most connected to us. We expect the market to evolve over the next basically 5 years about a 5 to 6 percentage point we present in terms of value of transactions overall in our geographies.

Clearly, on the higher end of this range in the less penetrated geographies and shorter term, more of a 5% if you look at longer term. If we now focus on the merchant services market, which is the one that is for us, ultimately the most important, we're talking about a market that in terms of revenue pools, net revenue pools is more or less a EUR 9 billion market today. We expect this market on the back of what I said before, to grow another EUR 4 billion, EUR 5 billion as a combination of volume growth, but also expansion in terms of products and services that we can sell to our customers from merchant financing to integrated payments to other things that Roberto will talk about. When you look at the segmentation in this market, SMEs represent more or less half of this market. Corporates represent about another 25% and e-commerce that is clearly growing is representing more or less the remaining 25%.

When you look at the characteristics of this market, the one thing that you realize that is very redemand for us is that the vast majority of the revenues of this market are coming from customers that are very local, and they continue to buy in a very local way. The SME market is local by itself. In the corporate market, the mid-corporates, the more national corporates still buy very much local and also the local branches of some international corporates continue to buy very locally with the exception of certain verticals. And last but not least, even when you look at the world of e-commerce and you look at it in terms of revenues, not volumes, most of the market is concentrated into the mid-market, which, again, is very local that requires very specific services locally.

As Nexi, we have an obsession for sustained focus on SMEs, mid-corporates and mid-market e-com. We are not -- we don't want to compete on the large global merchants in the large e-commerce space. That's not our space. We have marginal business there. We have no investments in place. We are completely focused on the dark blue that you see on this page. Now looking forward, there are 2 characteristics that will shape the market. We continue to shape the market over the next several years. The first one is that payments will become more and more complex. I guess you recognize all the titles on this page. And many of them we'll cover during the morning.

The key point is that this complexity is a lot for our customers. And therefore, this offers us the opportunity to help them because ultimately, if you are a small merchant you just want to accept any type of payment that your customer can put in front of you. You don't want to get into this mess. But also if you're a bank, you will struggle to stay with this complexity. Think about agentic e-commerce. It's far away from the competencies, the interest, the core of a bank, what their customers may want to be enabled for agentic commerce on their cards. So this complexity will continue to increase and it's a great opportunity for players like Nexi that have scale and ability to invest capabilities.

The second key element of the future remains the fact that the market in Europe is very fragmented than local and will remain very fragmented and local. This is exactly the same page that we had 3 years ago. We just updated on one aspect that I will tell you in a second. The United States of Europe, as we know well, don't exist. Definitely, they don't exist in our industry. Think about the local payment methods. Think about the software integration. Think about the nature of SMEs, but also the local corporates. And when you add on top of this, the integrated payments world, the world of ISVs, the world of software, the world of platforms. This is even more so very specific CR integrations. 90% of ISVs are local, probably more than that in our industry.

So we believe the market will continue to be very local. And by the way, again, this is a big opportunity for Nexi, as a company, it is very entrenched in the local ecosystems. In this environment where payments are becoming more complex and being local is very important. We believe 2 elements will be key for long-term success, scale and in-market presence in market entrenchment. And if we map the different players across this axis, local entrenchment and scale, we realize that Nexi really enjoys a unique positioning. Because we are the only one that is able to combine these 2 elements. Yes, we compete with a number of smaller local players, traditional, maybe some new ones and so on and so forth, but they don't have the sale to follow through the complexity of the industry, the investment required by the industry.

Yes, we compete with a number of larger players, European or even American, but they're far from being locally entrenched as we are. And by the way, the fact that product development, technologies choices, platform evolutions, capital allocation is decided somewhere else in the U.S. really doesn't enable them to be close to the markets and do what is needed in the individual local market in Europe. And yes, there are a number of -- now we call them here, NeoPaytechs. You know that better than I do. And actually, at least from how they are missing definitely the local entrenchment and for many of them, also the scale necessary to invest. And there is a lot of conversation around the single platform topic. Sensible to the fact that with a single platform, it's very, very difficult to play on this axis and to be close to our customers, being entrenched in the market, do what is necessary in terms of payment methods and customer support in the specific market.

These are just examples of the benefits that we get out of scale and locally market entrenchment. Scale brings you the ability to product investments, tech and AI investments to play strategically with partners both in the scheme space, but more in general in technology, not the possibility to shape the evolution of payments in Europe, obviously, operating leverage. But when you go into local market entrenchment, actually the ability to not only work with but sometimes run local schemes, play with the local relevant APMs, have in-market sales and customer support, local partnership and distribution, local integration and deep engagement with the local ecosystems. It's really the combination of these elements, these capabilities that makes Nexi unique.

If we bring it all together, what is our overall vision, our perspective, payments will continue to grow for the very long term with an increasing complexity and structural fragmentation across Europe, both these elements are good for us. In this context, our purpose is very simple. We want to simplify payments for our customers. From the smaller merchant to the larger banks being always reliable and securing our services, whether in localized solutions to our customers first and then in close customer support. And we want to do this with a very clear position to summarize by a few words that were the title of our 2022 Capital Market Day, European by scale, local by nature, best combination of any market entrenchment.

Overall, if we bring it all together, our ambition is to be the trusted the European platform, transforming the complexity of payments. This is almost astonishing for customers into opportunities for citizens, businesses and institutions that don't need to think about this complexity. They can just enjoy the benefits of technology evolution and more possibilities.

Now let me jump into how this unique positioning is translating into opportunities for growth for our company and in resilient growth going forward. Now in order to understand the short-term dynamics of our revenue growth and therefore, understand the future dynamics of our revenue growth, it is really important to separate the 2 components that coexist as we speak. The underlying growth and the bank effect. To be clear, we perfectly understand that ultimately, what really matters is the net revenue generation because this is what ultimately generates profits, generates cash, generates a return to shareholders. However, in order to understand what's happening today and what will happen in the future is really important to separate these 2 components because they leave completely different dynamics.

Let me start with the second, and Bernardo will dive into it much more and give you much more evidence. To be clear, bank contract effects, which are actively negotiations with banks with discounts and some potential losses have always been with us and will always be with us. However, historically, this has been more or less a 1% to 1.5% of our revenues. And this is what we believe will happen in the future because they are a part of the nature of our business, where volumes are growing, more services are offered. It's normal that we have this dynamic. However, in '25, '26 and '27, these bank contract effects have been -- will be exceptionally high, basically for 2 reasons because back 3 years ago, we lost a few but material customers on the back of very harsh competition normally on merchant book acquisitions. And as we look backwards, we still believe we did the right thing not to overinvest and not spend on that type of M&A, given the multiples at which it was going. And that is combined -- sorry, and I want to be clear, these losses were not to the new names to the nail pay tax. What a very traditional competitors, people similar to the ones that you can have in mind, either local or European.

And therefore, it is based on price, not on other elements. And together with that, this exceptional bank contract effects are also driven by a number of successful anticipated renewals that we had, on the one side, the need to do due to competition or the opportunity to do in anticipation to secure future revenues. These bank contract effects will be reducing to normal historical level of 1% to 1.5% from 2028 as most valuable contracts are now extended for a very long term. And by the way, at very much market competitive prices. And here, we have pretty good visibility.

If you combine -- sorry, the other element, the underlying growth will recover a lot in the rest of this session. But ultimately, the key message is that we want to leave with you is, actually, we are resilient to mid-single-digit plus. That's where we are coming from, that's where we will go. All the dynamics of the new market in merchant services ultimately have proven a good resilience for Nexi as we've been winning in the challenger markets and defending our leadership positions in the other ones. And this growth will continue to be driven by a portfolio of core engines and growth engines further powered by a number of very specific initiatives that we'll cover later on. If we bring these components together, this is the profile. This is the profile that you have.

An underlying growth that is going from 5%, 6%. And last year as well was at about 6% that we believe will continue. Obviously, we will have the ambition to increase it, but we believe at least it will continue. That combines with these bank contract effects that historically were around 1%. From '28, they will come back to about the same level, but not last year, at a material impact, about 4%. And this will continue over the next couple of years where lower, if you want impact, but still a very material impact. And here, I want to underline the fact that we have a very strong visibility. And even for the contracts that we still have to renew over the next couple of years, we've already embedded into these projections what we believe the effect will be.

This is the profile of ultimately what really matters that are net revenue growth over the next few years. And therefore, we will have a '26 and '27 pretty close to '25 for these reasons. And then as these bank contract effects disappear or go back to normal, we will have reacceleration about 5%. So if you want, the good news is that in order to believe we will go back to mid-single-digit growth. You don't need to believe that suddenly we will market share everywhere. Or we have some new product that we'll state the market or that we go to the moon. You just need to believe that we will continue to grow resiliently at our historical level and that these extraordinary effects will basically expire over the next year or 2.

Now looking into the profile of growth going forward. And before I tell you how we'll be driving growth going forward. Let me go back for a second to the concept of resilience. Looking backwards, and looking at today as well. And I'll do it specifically focused on MS, which is obviously the hot topic that we all are interested in. It's always difficult to construct market shares in our industry. It's basically impossible, let's be clear, okay? But if you go back and you try to aggregate numbers and here we'll be leveraging on a few very well done external reports. This is more or less the picture that you observe if you try to reconstruct the market shares for next -- to the other traditional competitors banks and the newer competitors.

What do you observe. Yes, the new competition has taken share in a growing market. But this share has been coming mainly from the banks and the other traditional PSPs also because very often, these newer players play in spaces where Nexi is not really exposed. Think about global commerce, think about the very large merchants in certain verticals. We are not exposed to that, and we don't want to be exposed to that. Overall, the Nexi market share has been broadly resilient despite new competition for every lost more or less 1 percentage point. And obviously, in 2025, we've been affected by the bank contract losses that have nothing to do with these new competitors.

And at the same time, we're recovering from banks and other traditional PSPs most of the limited losses that we had over the last few years. If now we look at this with our own internal data and initiatives. And here, the focus is really again -- and it's more, if you like, short term. Last year, today and so on and so forth. Let me tell you, we see it region by region, Italy, which is more than half of our business. Yes, we are seeing a market share erosion also last year, but it's due to these bank contract effects. Their lion's share has proven to be resilient, thanks also to the development of the new distribution channels, and we are having a growing exposure to e-com.

Overall, the underlying SME market share has been stabilizing towards the latter part of last year. Volumes underlying net of these bank contracts have been growing more or less 10% for international schemes, e-commerce revenue is up 8%. At the Nordics, here, we've been defending leadership position. I would say, very effectively in Norway, a bit less in Denmark and Finland, we've been winning market share as a challenger in Sweden, we did develop a lot of e-commerce and value added services overall revenues for Merchant Services up 3%, e-commerce revenues up 8%. If you look at DACH, we've been winning share in the SMEs in Germany and also a little bit across the region, growing with ISV partnerships and strengthening our operation in ecom.

German revenues last year, about 9% up strong. CSE strong both In Polish -- in Poland, SMEs about 10% and developing ISV partnerships in the region and new channels in Greece and Croatia. Overall, if you look at the international schemes, net of this product effects that had nothing to do with the new competitive dynamics, our volumes last year, they grew more or less 10%. And by the way, with a broadly stable take rate, which I think is a good signal as, yes, we have some price pressure, but on the other side, we sell more and more services to our customers. So overall, on the one side, we are defending our core, where yes, we get pressure. But no, we are broadly defending it, while at the same time, accelerating on growth engines.

Now going forward, going forward, we see our growth driven by a portfolio of core engines and growth engines. We like to map our businesses across these 2 axes. The market position we have challenger leader in some cases, greenfield and the growth potential that we see for that market. And we basically see 2 set of businesses for us. On the one side, you have Italy and the Nordics, very large. The bubble represents the size of the business with further opportunity for expansion, the further opportunity for expansion over the next 5 years is the white, if you want. But obviously, we are leaders. We can't imagine we take share. Everybody is trying to eat into our own plate. We will defend our own plate and enjoy the growth of the market. And these are our core engines at the same time with a number of growth engine. Instead we're a challenger. And therefore, we can invest to grow share. We can invest to accelerate growth and to grow the business.

And here, we have a number of them, let me point at 3, the German and DACH region definitely, e-commerce across the board, I told you that we are growing 8%, 9% e-commerce, both in Italy and the Nordics. So Italy and the Nordics are -- if you look at them more broadly in markets where we have a strong leadership position, but actually e-commerce is a great opportunity also there. Integrated payments that is the new theme for us and obviously issuing products where we have a great experience in Italy that we want to export as well.

Now in this portfolio, we'll be driving growth with a number of additional, we'll power growth in a number of additional initiatives. And this initiative will be focused on our strategic segments. To begin with, in SMEs, we'll be driving growth and customer value with strong localized omni acceptance payment solutions. Next is SmartPay is the key title. We'll be winning in integrated payments with ISV partners. And here, we will have a dual approach with Nexi integrated 4 ISVs and Nexi smart commerce for SMEs. And in parallel, we'll be investing in multichannel distribution across the board to win in SMEs. In market e-commerce will be accelerating with our localized collecting checkout solutions starting to embed during the year also e-commerce capability.

Nexi each -- account is the core proposition here. In mid-corporate, we'll drive growth with exceptional solutions with unique. We'll continue to invest in unique local components that are very important for the segment, extending gradually to omnichannel that is gradually becoming more important for this segment. And last but not least, with banks and corporates, by the way, will drive growth in issuing through a stronger focus on issuing products that allow us to grow value and not only number of customers. And Nexi Ready is the key topic. During morning, we cover all of them. I want to focus on 2.

The first 1 is obviously integrated payments, which is -- our biggest priority is my personal biggest priority, given the strategic relevance of that. And then I'll also say a few words on multi-channel distribution. Now let me start with the market of integrated payments because when we discuss it, we feel that everybody is very much looking at the U.S. experience. But U.S. experience, we believe, is quite specific, very large market with very unique characteristic with very large SMEs, very large players. When you look at Europe, we see the world of integrated payments that is starting to develop, but it's still at very different levels. This is the penetration of integrated payment solutions on the front book of payments. In the U.S., this is already well above 50%.

When you look at Europe, you have different degrees. Yes, the Nordics are more advanced, utilized economies also for SMEs. DACH is probably around 15%, 10%, 5%. Italy is super well below 5%. Also because the characteristics of this market in Europe are very, very specific. There are 1,200 ISVs only in our geographies. The average size is below 1,000 customers each. So very, very small and 90% more than them are actually active on one single market. So a large market, a number of small and many localized ISVs. Honestly, large U.S. ISVs are quite marginal on our footprint. We see something in Germany and Switzerland targeting the -- sector, but ultimately, quite marginal, also because you have into every single country, we operate a number of entry barriers.

The other element is that a lot of them are really basically CR payments with limited software integrations. There are a number of local integration and regulations. And by the way, every market has a different dynamic in terms of distribution of software in terms of competitive dynamics around software. So yes, this is coming. It's coming slowly and this very unique characteristics. We want to invest ahead because we believe this is going to be a shaping topic, and we believe it can also be a good opportunity for us. And here, our strategy, we discussed this in one of our calls for results in the past. Here, our strategy is completely focused around partnerships with the ISVs with a dual approach.

On the one side, when Nexi Integrated, we will serve ISVs. And here, we will provide our payment solutions to as many ISVs, local ISVs as possible. Today, we serve already more than 500 that will integrate them with their local solutions and bring them to the market with their sales channels. And we will invest. We are already investing in actually serving -- selling and serving to these ISVs that are in this context of our customers.

On the other side, with Nexi Smart Commerce, will pick in every market, we are picking actually, it's already happening in every market, 2 or 3 verticals in each of the verticals that are particularly strategic. In each one of these verticals, we'll select 1 partner and we'll do the reverse. We will bundle the software of this partner into our products and services and bring a Nexi Integrated proposition to the market through our channels, including banks, with a strong focus on upselling to our customer base. We talked about 2 million of customers in the SME space, actually in SME is a bit less, but most of them are in the SME space and that those customers are a great opportunity for us for upselling. And in order to do it, we will also invest in more distribution to them.

There are then a number of common components here, a visible one is the Nexi station that, by the way, you find there in the corner that Roberto will talk to you about that will be serving both proposition in a very unique way. So on the one side, Nexi Integrated to consolidate and grow next share across verticals, on the other side, differentiating Nexi, grow customer base value, and we share it in verticals.

Now distribution. We will continue to invest and we will accelerate investments this year on multichannel distribution. Multichannel is not new news for us. We're used to it, but I want to tell you what we'll be doing by channel. Let's start with banks. Banks are a big part of our present. We believe that will be a very part of -- very much a part of our future as well. They're relevant mostly for Italy. Don't forget it, 11,000 branches is a great asset for a company like us in terms of distribution and customer management. Some of them are also investing in outbound SME field sales force, which is great. And they're very keen for upselling, cross-selling and so on and so forth here. We will continue to invest actually having in Italy some specific dedicated investment to support them into this complexity to sell more now also on Smart Commerce.

On direct, we really include field sales, telesales and digital. This is very key for the Nordics and in Poland, but also in Italy, this is already now representing 25% of our firepower, up from the 10% that we had in the past. Here, we will invest in field sales capacity with a strong focus on mid-SMEs and then extend it to Smart Commerce. Last but not least, partners and ISVs. In this space, you don't have only ISVs, you also have those retail and other things. They're already relevant for the Nordic and DACH, very early stage in Italy, consistently where the market is, which is very underdeveloped. Today, we already work with more than 500. And obviously, as I said before, we'll invest a lot in terms of dedicated sales force and support to ISVs in particular.

Overall, over the next 5 years, we will add another 600 people selling products and services to SMEs, to ISVs together with banks in the case of Italy. Overall, we'll go from 800 people on the ground to 1,400 and in Italy, we'll basically double from the current 300. This approach will basically allow us going forward to basically cover up our firepower in terms of new sales in the market, in particular, it will power up indirect and ISVs. And in places, for example, like Italy, will also help complement banks that we believe will continue to be incredibly relevant. But clearly, these investments indirect and ISV partners are giving us an edge on the evolution of relevance of banks in our industry.

Now together with this resilient growth, we combine and will continue to combine operational excellence, disciplined investment. Here, I want to focus on 3 things: technology, efficiency and AI. Let me start with technology. Here, I want to be very clear. We are not obsessed with the single platform team. We understand the value of it, but we are not obsessed with it. What we are obsessed with is working against these 3 objectives: innovation, agility, local differentiation and efficiency. And continuously making choice, investments, decisions that balance over time, these 3 objectives.

So what we're doing, what is the progress here? First of all, on Products & Solutions, we are developing -- we already developed partially and we continue to develop modular group reference solutions to drive scale across markets that we can deploy across geographies. We continue to use, in many cases, local front end, call it, the gateways, call it terminals for having -- to have in-market integrations and customer proximity where necessary. We are developing integrated product factories for faster product development, more agile product development that are leveraging, obviously, AI as much as possible. And we have a number of common API capabilities that enable us to move these products and services to our platform.

When it comes to processing platforms, our next-gen target processing platforms are fully developed. And we approach the migration on these target plans in a very pragmatic way. There are cases where it doesn't make any sense, to be honest with you, to do it. because you're just creating a massive complexity for customers, you lose capabilities that are very relevant for them. And by the way, it doesn't work from the economic standpoint. But we continue to migrate in. We will continue to migrate and converge. Today, these target platforms will recover about 60% of our volumes. Our target over the next 5 years is probably to converge on them about 80%, 90% of our total volume. And that's it for the visibility that we have today because we are fine to maintain some local platforms that give us a strong competitive advantage that you could not have with the one platform approach.

Taking into consideration, however, that as we do this, compared to where we were in 2022, we've already taken out and shut down 25 platforms or platform components. Last but not least, obviously, we will continue to work and converge infrastructure as well. On data center consolidation over the last 3 years, we did cut by 45%, 50% the footprint of our data centers, which is real efficiency. We will keep on going, but ultimately, we are close to where we want to go. I think we'll go there in 1 or 2 years. At the same time, we continue our evolution towards open cloud architecture. And obviously, we keep security at the center of everything we do and clearly, we're already working on AI proof security.

Now a few examples of where we are going with this in terms of innovation, agility, local difference and efficiency, a couple of examples here. The small station you see there is a group developed product being rolled out very early on this year in the Nordics and then in Italy, Germany and so on and so forth. So it's -- if you don't have scale, you can't do that, okay? Or Nexi Ready. Christian will talk later. Based on Italy experience, we developed a pan-European platform that is ready for any trend across Europe to bring our experience there. Local differentiation, 2 examples here. We announced pagoPA as a local payment public administration and payment system. We announced a few days ago that we will bring to the terminals, to any terminal in any small shop, the possibility to accept public administration payments.

That's not something that you can do if you have a one single platform being developed from somewhere in the world. That's a flexibility you can't have or another example here in Finland. We talk a lot about unified commerce. In Finland, we are developing it on the back of a very local and very successful platform that is the Petrel platform targeting SMEs. You can't do that if you have a single platform approach, given the specificity of the market. Last but not least, efficiency, just to give you a sense of it, if you look at IT ops over the last 3 years, they've been broadly flat, broadly flat despite the growth of volumes despite the augmentation of the portfolio.

Second topic, efficiency. As you know, as a company, we've been focused on efficiencies since the #1. And if you look at our historic performance, our OpEx did grow 2% to 3% structurally. And we've been working on this front. We talked about IT efficiency and platform consolidation, operational transformation, continuous operating model view and organizational rightsizing. We will continue to do that. We will continue to do that. We are continuing to do that. And on top of it, we'll be leveraging as much as possible on the opportunities offered by AI. However, and therefore, going forward, we expect to continue to grow 2% to 3%. However, this year, we have decided that in order to go after those growth opportunities and support those strategic investments, especially on merchant services, IT products, SME products and so on and so forth, sales force and AI, Gen AI.

This year, we will increase a little bit the growth of OpEx as this includes more or less 2 to 3 percentage points of additional investments that we believe is strategic for the future, and we prefer to anticipate it. The third topic, AI. Again, we see AI, especially on the efficiency front as a big opportunity. As a company, we did start working on AI or actually machine learning, the way it was called back then, 7, 8 years ago in many different areas. Obviously, over the last couple of years with the arrival of Gen AI, agentic AI, we did double down on the space. We have -- we are continuously exploring opportunities, but we go as fast as we can into execution and scaling.

Here on the right, you see just some examples, let me pick you one of them. As we speak, we have about 1,500 software developers that are developing with the support and testing with the support of AI. The productivity levels that we see are already well above 20% after 18 months. And as we speak, we are starting to apply that also on cobol and mainframe, which is still with us and will remain with us for a long time. And in parallel, we're developing a number of enablers because we see AI something that is pervasive in our business. So our resilient enduring growth on the one side, continued focus on efficiency. These 2 things combined will allow us to continue to generate strong cash and distribute it to shareholders.

Let me now call on stage Bernardo and hand over to him for the session.

Thanks, Paolo. Well, good morning and welcome from me as well. In next few slides in the next session, we will attempt to translate what Paolo told us about positioning and strategy into revenue, into margin ultimately into cash. And I'll try and make the point that our infrastructure position in Europe positions us very well to become a very significant cash compounder. But before we start with the session on our financials going forward. Going forward, sorry, some feedback from behind us.

Let me start with the results for the year. I believe pretty strong operational performance with revenues growing just north of 2% for the year. Importantly, as Paolo has highlighted, our underlying revenues continue to grow around 6%. This has been pretty homogeneous throughout the year. And as we have seen in previous slides, if you look back in time, it's been pretty consistent over time. Our costs growing just under 2%, demonstrating our steadfast commitment to cost control in the face of, as we have said, inflation, volume growth. And volume growth in terms of cost is about a number of transactions, a number of transactions grows very consistently. But containment of costs, thanks to all the work we're doing on efficiencies in the IT department, you've seen how IT costs have been flat over the last few years.

EBITDA growing just north of 2% with slight margin accretion in the year. Normalized EPS growing double digit. And here, it's important to highlight also the fact that we did take an accounting charge, a goodwill impairment. This is obviously noncash of EUR 3.7 billion to align, let's say, the carrying value of the companies we merged with back in 2021 through the more recent market valuation parameters for the payment sector. Excess cash, importantly, has been growing double digits to -- we closed the year in line with our ambition to grow in excess of EUR 800 million to EUR 806 million. And importantly, balance sheet continues to be strengthening and we believe balance sheet strength is a strategic asset for us. bringing leverage down to 2.6x.

Again, before we start, just a quick word with regards to rebaselining the numbers for '26 onwards. And there are 2 minor adjustments. One of them is about let's say, making more homogeneous the way we -- within the group, the way we account for partner commissions, and this is moving basically cost to contra revenues. And the other is to basically reflect the fact that from the fourth quarter last year, we are consolidating comp top line by line. So adjustments, which are pretty much neutral from an EBITDA perspective. It's just housekeeping, and I would say, just for the purpose of pro forma in your baseline.

Now Paolo has told us how Europe is very local. It's fragmented, it's locally regulated and where it's local presence, local leadership that wins you business. And it's our platform scale that allows us to generate incremental economics with high margins, high cash conversion. And what I would like to start with is, again, a slide which some of you who've been following us for some time might have seen in either the previous Capital Market Day or even back in the day when Nexi IPO-ed. It's a slide which basically summarizes how this positioning in the market generates these 5 attributes that Nexi possesses. And each individual one of these, I think, is common to be found in any given payments company.

It's very common to see large companies or companies which generate profit or cash. What positions us is unique within this because we have all 5 on the same roof. So we are by far the largest, I'd say, payments company in Europe, EUR 3.6 billion of revenues, close to EUR 2 billion of EBITDA. We have sustainable profitable growth. We've been growing both revenues and EBITDA over the years. We have generated a substantial amount of cash, EUR 2.1 billion over the last 3 years, EUR 800 million just in 2025. And we started to distribute this cash to investors. We paid out EUR 1.1 billion in the '24, '25 period. EUR 300 million was our first dividend last year, one we'll speak of later during the course of this morning or this presentation. $800 million was used to buy back stock.

And within this context, we have brought our leverage down to 2.6x. We're on the edge of reaching our 2 to 2.5x target because we were always eyeing and we're always commitment to achieving investment-grade status, which is what we did at the end of 2024, and we remain committed to maintaining and building on this growing going forward. So as I said, these 5 characteristics are, I would say, unique to be found in any one single company. Again, another slide which you're probably familiar with, we called it amongst ourselves, our cash generation formula. And it shows how we possess operating leverage. Our revenues grow. We've seen the underlying growth translates into reported growth as well lower than what we have historically, but we'll speak about that. But our top line growth, based on the fact that we have a predominantly fixed operating cost base, 20% of our costs are variable, 80% are fixed translates to operating leverage, which feeds into EBITDA growth, cash growth. Cash growth, which is then compounded because we have cash leverage through the fact CapEx continues to come down as we digest our transformation and integration and nonrecurring items, which have come down substantially in the last 3 or 4 years, compounding this cash growth going forward, and you see the progression in the chart here.

And it's I believe this ability to compound cash growth -- and generally, the significant amount of cash, which ultimately will be the driver, the engine behind the equity value creation for investors going forward. Something we have -- or Paolo has spoken of and just like to represent in this chart. And essentially, what we do is go back in time and see how our revenues, our reported revenues have pretty much always been growing between 5% and 6%. And if we had the numbers and weren't too hard to perform on them going back even if we went back to 2018, 2017, 2016, I'm sure they would show a similar picture. But they've always been growing more than nominal GDP. That's why we believe our business is a GDP plus business.

Of course, we've spoken and we'll dive into a bit more detail in 2025. I've shown you the numbers that reported is really about the bank contracts in fact what Paolo mentioned, and we will see more in detail in a few slides. But the underlying growth is still that 6% that we were speaking of. And importantly, this is structural growth. Structural growth, which is ingrained and based on the fact that as we have seen the markets in which we operate are still underpenetrated compared to the average for Europe and much less than the average for countries which are, let's say, at the forefront of the adoption of cash payments.

So there's a lot of headroom for further growth. This means our growth is really infrastructural growth. It's not cyclical. And it's very resilient and predictable. This slide, Paolo showed you earlier. So again, we can see how that 6% underlying growth, we expect to continue going forward. We don't expect our underlying growth to change. What we expect to do is to change the profile of the growth of our reported revenues, which is the only one that accounts. And why do we believe that, you can see it at the bottom here, the bank contract effects, which we have spoken of, which basically were crystalized or were generated back in 2023, beginning of '24. And because of the difficulty of moving volumes and business away from a payment company like Nexi to someone else, are only materializing today, and we've seen the peak of the impact being in 2025 with a 4 percentage point gap between reported and underlying revenue growth.

Unfortunately, we will still suffer from this in '26 and '27. But in '28, we will revert back to normalized levels of doing business, which means often offering discounts to renew contracts and the likes, and we'll speak about the fact that we've already done a lot of this. And we'll continue this way thereafter and I'll speak a few words with regards to why we believe that this profile is the right one. But it's important that you know that structural demand is intact. And therefore, reported growth is expected to follow this profile going forward. And to return, as Paolo was saying, to what we were already delivering, you don't need to believe we'll do anything different to what we've already been doing in the past.

So apologies, this slide is very busy, a lot of logos, but it's important to look into greater detail as to why we believe that reported numbers in terms of top line growth will revert back to what they used to be. And it's important to highlight how strengthened our relationship is with banks, primarily Italian banks, not only but primarily Italian banks, which were at the heart of the gap of the dip in terms of revenue growth that we've seen so far. And this materializes as I was suggesting, back in '23, in the first half of '24 when the market was characterized by higher multiples in terms of the M&A landscape in the payment space. And this both enticed banks to sell their contracts and distribution, and they're willing to go through the 2-year ordeal, I would say, of shifting business from one payments partner to another.

And it was characterized also by some players who were willing to pay significant premiums, significant multiples in order to acquire a position in the Italian market. Without mentioning names, I'm sure you will agree with me that some of these are probably no longer in that business anymore and unlikely to return to where they were only a few years ago. And indeed, we've had a wave of renewals since then, if you look at the slide from second half to '24 to today, basically, it's in the last 21 months, I believe, we have had a 100% renewal rate of anything which has come up. This is a much more normal kind of development of the payments market. Renewals with contracts, which now give us greater revenue visibility going forward and are priced at levels which are very similar or very much more aligned to the market and don't suffer from, let's say, legacy M&A-driven contract.

So revenue visibility really has materially improved and gives us the comfort that I was referring to. Now if we look at the top -- and this is again another little deep dive in terms of our revenue visibility, which I hope helps you understand and come around to my point of revenue visibility being very high. This chart we're showing you, our top 20 contracts with mostly Italian banks, but it's European. They represent more than EUR 1.5 billion of revenues if you include revenues generated through merchant referral agreements in Italy. This is 50% or more of our issuing and acquiring revenues in Italy. 90% of these revenues don't have any renewals attached to them which come to you before '29. And the largest ones, these ones here, which you say, large-sized banks. There are hundreds of millions of euros of revenues associated with contracts with large banks. These are 2035 and beyond.

And also that -- so 90% of what you see on this slide of that EUR 1.6 billion of revenues of these 20 -- top 20 banks, 90% are '29 and beyond. The remaining 10%, so what you see bank #3, merchant solutions has been extended issuing is in the process of being negotiated and so on and so forth. These are negotiations in a broader context, a very strong and deep relationship with the bank. It's not about M&A, which is what happened in '23, which is what drives the gap between reported and underlying revenues. And we are in a strong position to secure these, we are in advanced discussions. And importantly, our expectations with regards to the outcome of this have already been built into those bank contract effects I was referring to earlier -- that our visibility is very high with regards to these bank-related revenues and contracts and has materially improved over time.

So if we move on from bank relationships to -- and visibility and revenues through speaking about growth drivers, we have a target to reach EUR 4 billion of revenues in '28 and some common themes across Europe, which help across the divisions that we operate in to deliver this growth. First one obviously is just the secular shift of cash to card payments in Europe predicated on the fact that, that 36% market let's say, penetration or penetration of payments will trend towards that 46% on average in Europe, that 55% we've seen in the markets in which we don't operate, that 100% that you see in countries there, which are already cashless where you're not talking about kind of increased penetration of payments, cash doesn't exist.

So a lot of headroom to continue to grow. And this is a common theme across our geographies and across the business units we have. Of course, unfortunately, we have common themes in issuing and acquiring on -- in terms of bank contract effects. You see them highlighted there. more so on acquiring even this year, so in '26, definitely last year, more so in issuing in '27. So that means that -- Solutions was actually, and Paolo referred to this earlier, will accelerate first or maybe didn't, I have just said it, will reaccelerate first in our planned period. And Merchant Solutions will, of course, be the biggest contributor to our growth, and there are some themes there that have been highlighted and Paolo has gone through.

We'll talk about them more later about SME, how important that is for us, that sector, integrated payments, that's the convergence of software and payments, e-com, which continues to grow and omnichannel expansion. Christian will tell us about Nexi Ready, which we already rolled out in Germany, and we continue to upsell and cross-sell advanced digital issuing products in the rest of Europe and digital banking solutions, which also benefits from the growth in instant payments.

So what we continue to see is secular growth in our space, which is supported by our execution and our strategy. We don't see disruption in this space. If we look at geographic diversification, we'll come back to a point and I can come back to point Paolo made earlier. Our portfolio of geographies comprises both countries in which we're leaders, core markets like Italy, like Denmark, but it also has countries like Germany, where we are a challenger and our growth market for us.

Indeed, we have common themes geographically across Europe as well. The markets in which we're present has the market growth phenomenon that I was mentioning earlier. Integrated Payments is a theme across Europe. Of course, e-commerce growth continues across Europe is that feature in most markets in which we operate in. In this context, Italy continues to be foundational for us, notwithstanding what I spoke of in terms of the bank contract effects. And we will recapture through our strategy of growing our direct channels, part of the market share that we lost because of this. We already are.

The Nordics continue to grow despite the high penetration levels we have there, also thanks to our upselling of value-added products and services. And Germany, of course, allows us to compound the natural growth in the market because of the underpenetration of the German market with our market share gains given our positioning as a challenger.

Moving on to costs. Historically, we have grown costs in the '22, '24 period by about 3%. And this period was characterized by very high inflation, 7%, 8%, a number of transactions growing double digit, impacting us on that 20% of our cost base, which is variable. Notwithstanding this, I think we've demonstrated structural cost discipline. I think we can claim credit for that. I'd like to put it to my colleagues, we have demonstrated, I think, a healthy version through cost growth. And this has delivered the structural growth of 3%, just under 2% this year, which is, I think, a good result.

Going forward, in '26, we see -- we've divided this chart into the same kind of structural cost growth that we've experienced in the past, which is increased, I would say, by our targeted strategic investments in product and distribution that Paolo just spoke about. Some MS products, the sales force. And of course, AI, Gen AI, all these investments or these benefits that we seek through reap and are already reaping come at a cost of investment, and we see this in 2026. But importantly, in a predictable fashion, we will revert back to what our historical cost growth has been already in 2027, so you can see that 2% to 3% range. So this investment peak for me, it's important to convey to you is about supporting future growth.

It's not expansive. It's disciplined. And margin expansion will resume in -- the meaningful margin expansion will resume in 2028. We plan to reach EUR 2.1 billion of EBITDA then. A significant contribution clearly is expected to come from market growth and initiatives we've spoken of. We will continue to combat cost growth. You can see the 2 bar chart, inertial growth. This is volumes, investments, inflation combated by our work on IT efficiencies and operational efficiency. This is a constant improvement game in that space in which we have proven over time to be successful in. And importantly, back to the point I was making about contract effects, we have -- thanks to the visibility we've spoken of being able to derisk our predictions with regards to where we will land in 2028 in terms of EBITDA by the effects of these contracts.

Therefore, we expect significant margin expansion actually to resume in 2028 and this EBITDA through -- our EBITDA to achieve that EUR 2.1 billion point. Now when I speak of costs, I look at cash CapEx. It's an investment, of course, is and my colleagues will save it for me, it's also a cost. And you can see that in terms of CapEx, I think we've come a long way, frankly speaking, only when was it, 2022, I think we had EUR 520-something million, EUR 522 million of CapEx. In this period, we've soaked up a lot of inflation. We've soaked up a lot of investment in transformation and integration yet we have come down by EUR 100 million or more in terms of CapEx. And our capital intensity has also come down from more than 16% to 12% today. And we expect this to trend towards that all important 10% line, which we will achieve in a not-too-distant future.

And I would say the maturity of our infrastructure, following the transformation spend that we had in the prior years, lowers our CapEx intensity, but importantly, also improves the predictability again, of our cash flows going forward. So this CapEx intensity coming down to 10%. We'll see it with the cash generation over time also helps in terms of supporting our cash conversion predictability. So this is, again, I would say, reiterating a point I just made is essentially our cash conversion, our cash generation formula.

So going forward, the key messages that I want to leave with you are the same that we've already discussed a number of times, we will continue to benefit from operating leverage. We will continue to benefit from cash leverage and conversion will be increasing in recent years, which is compounded by, as I said, the reduction -- further reduction in CapEx, the further reduction in our ROI. And I'm profoundly convinced that this is this that I believe will be the engine of equity value creation over time for Nexi. If you look at the cumulative number, we believe we will generate EUR 2.4 billion of cash over the next 3 years. We've generated EUR 800 million this year, this year being 2025, EUR 2.4 billion over the next 3 years. This at today's prices is probably more than 60% of our market cap. I believe this is a key point to be underlying.

Going forward, as we said, the first guidance for 2026, I can give you is that we expect to generate EUR 750 million of cash this year. This is impacted. Why is it down from the EUR 806 million. Simply put, we have more taxes to pay in 2026. And this is a gift of the budget which came in late in the year, where bank taxes, banks which benefited from higher rates and were taxed caught us in the midst, and this costs us essentially the difference between that EUR 806 million and EUR 750 million. But we expect cash generation growth to accelerate over the planned period. In total, we expect to generate EUR 2.4 billion of excess cash in the next 3 years, and we expect this growth profile to be accelerating over time.

Now before I move on to guidance and wrap up. Another word with regards to 2026 and capital allocation going forward. First and foremost, you should note that we remain steadfastly committed as a management team, as a Board to our investment-grade status, not the rating, status, which is a broader commitment than just the leverage target you see here. We believe the balance sheet strength, I said it earlier, is crucially important. This is a strategic asset for us. So discipline on this front, frankly speaking, comes first. As I mentioned, we closed the year at 2.6x leverage. This is just on the edge of the 2 to 2.5x target we had always said as being the kind of sweet spot in which we should operate in. So that puts us in a comfortable position to address the second point, which is also equally important, which is return of capital to our shareholders.

Now we've chosen to focus this year on a dividend per share of EUR 0.30, only that. This is a 20% increase on last year's dividend. It is accompanied by policy, which we'll speak of in a second, to increase this dividend every year by at least 5%. That means over the next 3 years, we commit to distribute at least EUR 1.1 billion by way of dividends. That is 30% of our market cap or more today. We will obviously continue to scout the market for M&A opportunities, but we'll engage in them only if they are very value accretive for us and make strategic sense whereas we'll continue also to focus on rationalizing our portfolio and optimizing it.

This will primarily come in the DBS area, would be my guess. There won't be huge transactions, but it shows, again, discipline in terms of the strategic composition of our portfolio and our commitment to optimize cash and capital. Obviously, I've spoken about EUR 1.1 billion of dividend distribution, the balance between that EUR 1.1 billion and the EUR 2.4 billion of cash we will generate over the plan. We will assess on a year by year basis what best use there is for this incremental cash generation. It may well be further acceleration and deleverage. It may well be bigger dividends. It might be share buybacks as we've done in the past. All of this will be assessed on a year-by-year basis. I think the important thing to focus on is we believe from a capital perspective that we are in a strong position to build on our investment grade rating. And at the same time, continue to distribute capital to our shareholders and pursue selective M&A if and when the opportunities arise.

Final slide on our guidance. Starting from 2026. We guide towards basically revenue growth, which is broadly in line with this year. You saw around 2%. I expect or we expect Merchant Solutions to be reaccelerating particularly in the second half of the year. And all of 2026 will be an acceleration compared to the second half of 2025. Moving forward, looking further down the line in the planned period, we expect to return to that mid-single-digit growth that we've seen has been our historic reported level of growth in 2028. We look at EBITDA, also EBITDA given the strategic investments we're going to be making this year, I expect to be broadly stable in absolute terms compared to 2025, and we will return to meaningful margin expansion of the EBITDA in 2028.

With regards to the use of excess cash -- or sorry, before I go to that, excess cash generation will be round about EUR 750 million. I mentioned the taxes. I also mentioned and called out the fact that we're investing in our future growth in 2026, which also helps explain this number. And going further down the line in cumulative terms over the planned period, we will generate EUR 2.4 billion of excess cash. And then going to capital allocation. I've just mentioned it. We've chosen to focus. The Board has chosen to focus on dividend distribution because we believe that provides you with maximum certainty and commitment in terms of our ability -- to distribute capital to shareholders, and we start with a EUR 0.30 per share dividend, which is a 20% increase from last year's EUR 0.25 dividend, and this will grow at least 5% over the planned period.

So before handing the floor back to Paolo, just let me wrap up. I mean Europe remains fragmented and regulated as we have seen. Nexi is embedded at the core of all of this complexity and our leadership does allow us to generate durable revenues which coupled with our cost discipline and platform scale allows us to deliver this cash compounding feature, which I've spoken so much of. We are essentially the infrastructure backbone of Europe. We act as an orchestrator, as an integrator in a very structurally complex and essential ecosystem. And this gives us great visibility in terms of cash generation and compounding capacity.

That said, let me hand the floor back to Paolo. Thank you very much for your time.

Thank you. Thank you, Bernardo. And let me wrap up this session with the last point that we wanted to deliver that I think Bernardo has already moved towards, which is our structural long-term resilience. Here, I want to address it going straight into the, I would say, the 4 topics that I feel -- we feel being a little bit hot topics in our conversations with you and with investors. The 4 topics are these newer MS competition. I think we discussed it, we can go back to it in our Q&A.

We see an underlying resilience with this new MS competition. And as you understood, we are investing to grow stronger in SMEs and integrated payments going forward and sales force. Second, now we discussed a lot of debate around the relevance of banking, the banking channel. We believe the banking channel will continue to be relevant at least for Italy, but at the same time, we are also hedging and investing into additional strength in a multichannel approach.

Now let me briefly talk about the other 2 topics that tend to come up in our conversation, alternative payment methods and AI and agentic commerce, agentic payments. Alternative payment methods, we already say a few words about it. They are not new news for us. We've been used to it over the last several years. Every day, we activate a new alternative payment methods. And this complexity coming from additional payment methods is actually good for us. They are more intended for person-to-person and e-commerce, given the fact that the experience of cards and wallets is superior in store, but they also coming a bit more in store.

We will continue to do what we are doing now, which is integrate all the new payment methods that come up from the specific markets into our accepted propositions because it's all about simplifying payments for these merchants that want to be able to accept these payment methods. And actually, we do it with good economics that are comparable to the economics that we see with debit cards, which is the compatible. So we'll keep on going. This complexity is good for us. Obviously, there is a lot of discussion around stablecoins, will they change in this work. Our point of view is that stablecoins are really not creating some customer value beyond the other applications they can have, beyond the store of value concept for countries with stable currencies and so on and so forth. In commerce, they can create some value probably with for business-to-business and cross border, that's not our business. Our business is retail payments. We don't see, at the moment, material application or material space for stablecoins there.

Nevertheless, we're already organizing ourselves to be able as the regulation stabilizes as well to accept stablecoins in our geographies in store and align through initially at least through partners. Last but not least, the digital coin, a lot of discussion around it. We believe it will come and it will come at some point, pilots will start into next year and will be a part of it. Ultimately, we see this as another payment method which has specific characteristics, but ultimately, it's a European product. And as a critical European platform, we are very entrenched into the space of the digital euro, and we believe it will present opportunities across our breadth of solutions, merchant services, IS and DBS as well.

So this exploding complexity of payment methods, we believe is for us ultimately an opportunity. Last but not least, AI, a lot of discussions. Obviously, AI for efficiency is a great opportunity. We already talked about it. So let me move to the other front, which is obviously AI for innovation. In general, we believe AI offers a number of opportunities for making our products stronger, our customer experience better. And we're working on a number of these things. Just to give you an example, Roberto will come back to that. We just rolled that MCP model context protocol to allow merchants that already operate with agents, which transmit and not that many to interact with our properties, with our platforms, with our systems through APIs, okay?

Now when you look at AI in the more innovation space, obviously, the hot topic is agentic commerce or agentic payments. And here, I think it's really, really important that we hear on a few basic elements. First of all, this is really relevant for e-commerce. And e-commerce in the case of Nexi is about 6% of our total revenues. Second, it will be relevant, especially in the initial phase, really for the more global large merchant -- sophisticated merchants, which are not really our target. We do have no exposure to them. So in general, in terms of -- is this something that we're exposed to in a very, very limited way.

Second element is that there is no doubt that agentic e-commerce will transform the search, the discovery phase of a commercial buying journey. But reality is that we are focused on the payment moment. And the payment moment requires a lot of trust and a lot of human interaction. So would you give permission to your agent to buy something without even knowing what it's buying, how it's buying, from where it's coming and so on and so forth. I think that's a key question. And as a merchant, would you accept payment from someone that is represented by an agent. So it will require a lot of development also from the regulatory standpoint.

Said that, we believe that in Europe, these will have specific characteristics. And we are working already with the global leaders to shape this evolution, Google, Visa Mastercard. And we'll be piloting agent e-commerce during this year. Having in mind our market, which is a mid e-com market, which is a very attractive market because it will require quite a lot of support to come on board with the agentic commerce space. And last but not least, there is also the other side of the moon. Think about issuing. We have about 140 million cards. We want to make these cards agentic commerce, which again can be an opportunity. So all in, we see this as an opportunity for further development and in an environment where we're actually protected from potential disruption risks.

So this closes a little bit the picture. So a unique positioning in a growing market, in a very dynamic market that we continue to see dynamic a resilient revenue growth mid-single digit going forward, combined with continued efficiency that will continue to generate cash that we will be able to return to shareholders and this formula, we expect it to work for a very, very long term. Let me pause there. Let's go for a break. We are a few minutes longer. If I can ask you to come back at around 10:20, that would be great. Thank you.

[Break]

So welcome back. Thank you for having us to recover a few minutes here on the break. So Bernardo and I gave you the overview of our positioning, of our strategy, our plan going forward. Now we will deep dive into the real substance across customers, customer needs, initiatives. We will start with winning in Merchant Solutions, and the session will be led by Roberto, our leader for merchant services across the group that will be joined at some point by Sara that probably you never met that is our Chief Product Officer for Merchant Services.

Roberto, the floor is yours.

Thank you, Paolo, and good morning, and a warm welcome to Milan also from my side. Let me start by quickly recapping our starting point in Merchant Solutions. We have a EUR 2 billion business, basically 55% of the overall group revenues. And we are very proud that every day, we have hundreds of thousands of businesses albeit small or large, run their own business and endeavors whether they are in store, online or omnichannel. If we look at our revenue mix, you will see immediately that the majority of our net revenues and our margins come from a very strong and unique position in the SME market. Of course, the corporate business is an important foundation in general for our franchise and so on, but SME is where we're really enjoying a leadership position across markets.

Let me remind you that we operate in multiple markets in Italy and in 3 out of 4 Nordic countries, we enjoy a leadership position, while we have established challenger position in the DACH region, more broadly, and in CSEE. So basically in Poland, Greece and Croatia with a smaller and lighter presence in the other Eastern European markets. If you take the perspective of the future growth that we expect during the penalize -- you will see immediately that the bulk of it will come again from SMEs with a particularly strong contribution from DACH and CSEE where we expect not only to continue to drive customer value, but also to gain market share. And from e-commerce across the board and you will see moment where exactly we plan to focus into the broader e-commerce space.

Now without any further ado, let me deep dive into the key segments and initiative that we are enacting, we are investing in to drive the future growth and that already Paolo has outlined before. I will not touch in detail the investments in distribution, but let me stress again that this is an extremely important part of our plan, an extremely important area for investment. That is also highly synergic with all the other things that myself and Sara will present to you today given the importance of accelerating distribution capabilities on new products, new solutions, new proposition and so on and so forth.

Let me start from SMEs. And in every section, I would like to start from the customer, which ultimately is our true North for everything, maybe giving you a few insights on exactly who are our target customers and what is the European landscape in each segment. Again, on SME, we are looking at businesses that are much smaller than their U.S. equivalents. Typically, in our footprint markets, they are below EUR 5 million or much smaller, owned by families, very often single location of low single-digit number of locations with a relatively low level of digitalization, which ultimately translates into 2 things.

One is that still a very limited presence of e-commerce. The other thing one is that when you look at things that really digitalize the business, for example, use of business management software, they spend much less than their U.S. equivalent. This kind of characteristics immediately translate into what they need from a payment service provider, and this is where we really like to start to then drive our proposition and solution. Ultimately, test of the business for SMEs in Europe is ensuring a super reliable, always-on service. They need not to care about whether the services are available or not because ultimately, this drives the earnings and their ability to continue the business. The second point is making sure that their customers enjoy a very frictionless checkout. And often, a frictionless checkout in Europe means one very simple thing, ensuring that all the local payment middles, local schemes and APMs are accepted without any hitch so that the customers can pay with whatever payment mean is of their own liking.

Then, again, these are people who are passionate about their business. They are not passionate about payments. We have pressure on payments. So another key need is ensuring that they don't have to care about the complexity, the fragmentation of this business, they look for someone who can provide simple solution in a bundle. Last but not the least, they are not international companies. They are super local, and therefore, they really strive to find the ability to find someone who is talking to them with the local language, who is very close in terms of proximity, for example, in customer service or in any kind of other service interaction.

Keeping that in mind, let's look at the 3 pillars of our SME focus. And let me start from Smart Pay, which is our core proposition for SME. The idea of Smart Pay is to combine the very best digitalization for SMEs with a very strong set of local capabilities. When you look at the digital -- we are actually heavily invested in this space over the last few years, and we'll continue to invest on this, starting from something that will deep dive in a moment, which is our range of acceptance devices and moving into other digital capabilities such as the ability to be flexible in settlement, the fast onboarding again, through the use of AI to accelerate the fits and effectiveness and to the interaction with the merchants to digital properties.

A very important piece that I will then deep dive in a few pages is the space of value-added services, where we see, for example, embedded finance such as merchant financing is a key element for driving in the future customer value. At the same time, we are providing a very large set of things that really make us very local and very close to these kind of customers, starting from the ability to accept any kind of local payment method whether it's local schemes like Bancomat in Italy or an APM wallet like this mobile pay in the Nordics, we are there. We have all these kind of integration, and we provide that in a bundle within a single acceptance solution. We are also very closely integrated with all the kind of national, let me say, ecosystem or infrastructure starting from tax, moving into local standards for cash registers, all our things that are very specific to single markets like meal vouchers in Italy and in Germany.

We are not just integrated. Often, we are closely partnering with institution of other stakeholders in the local ecosystem to codevelop these standards and therefore, enjoy again, a unique starting point in it. Last but not least, we also -- in every market in which we are present, we have local customer operations, operators who speak in local language that we are making more and more efficient to the use of AI over time, and we enjoy local terminal logistics, which help drive very strong service levels, for example, in terminal replacement.

Smart Pay already today is a significant part of our front book in most of our markets and is already enjoying a very important differential in customer satisfaction vis-a-vis more traditional and legacy propositions as have been to the NPS score. Now let me go quickly on one other point, which is our acceptance devices, our terminals, if you want, we like to call them software defined for a very simple reason. Our philosophy in space is that the hardware is a foreign factor and what matters is the customer experience. And the customer experience is driven by the payment application, which is something that we have on our own that we develop in our digital lab in Finland, where we have a set of specialized developers for this.

As you can see, it's a wide range, all within the same family falling. These devices can be mixed and matched for different store formats, from mobility to large multi-lane kind of setups. They are ready for all the future developments in terms of payment methods, for example, think about digital euro or stablecoins that we are going to pilot as Paolo was mentioning before, and really are the heart at our integration with ISVs and software given their capabilities to be easily integrated to -- talking about integrated payments. Now let's move into that space, which is something that is super important and it's super important area of investment for the future.

And again, let me start with the customers. When we talk about ISVs, we often think of global leaders, like, I don't know, light speed of toast in the U.S., actually, the European landscape is very different. There are very few exceptions. But more broadly, European ISV are very small. They are extremely focused in terms of vertical, not just in terms of vertical overall, but often in super vertical. In health care, there are different software for gyms or salons. And in the vast majority of cases, they are single country with a very, very low limited international footprint. And the starting point from a technical angle is very much the right. There are some of them that are super digital. There are others who come from the traditional cash register environment. And therefore, the architecture and the technology that they enjoy is quite differentiated.

This, again, drives their needs and their approach to integrated payments. The first need is about flexibility. Flexibility is modest because they start from a very different point. And they have different dot priorities. Flexibility in technical integration because, as I said, not every one of them has already a very digital infrastructure. The second is proximity and simplicity, again, similar to SMEs. They don't want to have about all the regulatory compliance in payments, and they want to make sure that there is someone locally that can help them first integrate payments into their own solutions and then market those solutions. And in general, they like to think of their payment partners as someone that can really be a strategic accelerator for the distribution, their expansion given how much they have competing priorities, for example, between investing on the product and investing of distribution.

Starting from these needs. Our strategy, as already presented to you, has been focused on 2 pillars. Let me start from the first, which is Nexi Integrated where just a very quick recap, we plan to integrate our payment capabilities into the ISV software distributed by the ISV. I remember that 3 years ago, in our previous Capital Market Day, I was on this stage talking about the start of integrated payments. From that moment on, we have invested -- we will continue to invest in a set of capabilities and proposition that comes under the umbrella name of Nexi Integrated that actually address all the different elements of the ISV needs. And let me start with the first one, with Nexi Partner Hub.

Nexi Partner Hub is really the platform that is at the core of our integrated payment strategy. It's a very flexible solution that allow ISVs to integrate seamlessly to APIs when they are more digital or to basic portal interaction to manage their business. It is going to enjoy all the best of the AI capabilities in terms of digital onboarding and so on. It already has a lot of digitalization to speed merchant onboarding, but will continue to invest in this design. And it has a specific set of solutions and features that are allowing ISVs to manage price, bundled offer and solution selling more in general to the merchant.

Last but not the least, it allows ISV, not just to accept the core capabilities, but also the wider set of value-added services, for example, in terms of merchant financing to drive again overall customer value. The second pillar of our integrated payments proposition is the set of, again, locked solution -- physical solution for acceptance, starting from the Smart Station, which is the modular commerce solution that I will explore more in detail in the next page that you can find at back of this room and moving into the SmartPOS range. The SmartPOS range that is easily integrated into software solution to a wider set of cloud-based APIs.

Very important is also the possibility for ISVs to load the software into the terminals to provide only one solution, for example, are very useful for simpler stores or for mobility use space. All these solution can be mixed and matched. For example, putting together a Smart Station with the more traditional terminal for pay-at-table capability. They have the same software underlying, and we will continue to evolve and add the form factor and models in this range. About the Smart Station, the angle of the Smart Station is very simple. We are going to bring to local ISVs, the set of world-class capabilities that some examples of the large U.S. players are enjoying and that the local players, GPM players cannot really address given the lack of scale.

It is basically a very modular solution that combines double screen interaction with the data payment hardware. It can be flexibly configured. For example, you can remove the front tablet to use it for pay at the table or for pay at aisle kind of situations. The ISVs can load their software into the solution, of course, and that can use the device API to integrate with the device. And as I said before, can be combined with all the other solutions into the range. This is something that we just presented at the start of February to our Nordic partners with a very good commercial traction and that will proceed to roll out across our markets during 2026 and the start of 2027.

Let me move now into the topic of the business model. As I said, ISV like flexibility because they have a very different starting point. And therefore, we have a set of different business models that is something that really differentiated us from some of our competitors to address these different stages. The very best business model is the lead generation. We can close the payment contract on behalf of the ISV, this allows any kind of ISV to really start bundling solution payments with very limited investment, extremely sweated for start-ups and smaller ISVs.

The second one is a more traditional agent of a reseller model, a different name by market, but actually, it's the same stuff in which the ISV is selling on behalf of Nexi. This, of course, requires a little bit more investment from the ISV side because at that point, you integrate more deeply the software solution with the payments and therefore, is where we see the bulk of slightly bigger ISVs being interested into. The last model, Smart PayFac is for sophisticated and bigger ISVs that want to take full control of the user experience, deeply embedding payments within their checkout and stock management flow. This requires much more technical work. However, in this case, we take out the complexity from a regulatory standpoint from the ISV which again differentiates this model from the traditional payment facilitator that are quite used in the U.S., but much less present in Europe, exactly due to the regulatory cost. So the ISV can enjoy the same user experience the same kind of flexibility of a traditional payment facilitator without the regulatory complexity, without the regulatory risk.

In every model, the presence of a local customer support is exactly the same. We have local solution engineers that help the ISV design and perform the integration, and we have local success managers both on operations and on the sales side that help the ISV drive the right decision for scaling the business. Last but not the least, Nexi Alliance, Nexi Alliance is a partner program where we actually put together our partner ISV to create network and actually to a little bit help them, for example, with marketing materials with tools and so on to scale their business. This is -- this overall set of proposition is already enjoying quite a good commercial growth.

Today, we already partnered with 525 ISVs with a good pipeline of new wins and new contracts during the last year. Of course, the number by region -- based on the local evolution of the market in the Nordics, highly digitalized societies, we have the bulk of our ISV partners, Greece, Croatia, Poland and Italy have a little bit at the start of this journey, but they are catching up fast. Germany and Switzerland are a little bit in middle ground between Nordics and the other region. You will see in the deck a few examples. Let me just spend a couple of minutes on a couple. The first one is a Swiss example of one of my restaurant that we are partnering now been a couple of years with them. We provide a full set of restaurant management capabilities, integrating payments and store management solution for quick and food service restaurants, providing capabilities from Pay at the table, self check-out kiosks, integration with water -- devices and so on and so forth.

The other one is TeamSystem, which is a little bit of a different versus the majority of ISV in Europe, it's a much bigger company. It's a leading provider of business management solutions, serving all the 2.5 million SMEs across people market, which is a recent win. And starting from Italy and expanding over time, potentially to other markets will integrate all our solutions into their software, including the SmartPOS range that we have seen before, starting from verticals such as hospitality and retail.

Now let me move to the second strategy. Nexi Smart Commerce. In Nexi Smart Commerce, we a little bit reverse the angle. So we select for every market, 2 to 4 verticals where we believe that integrated payments can enjoy a faster traction. For every vertical, we enact on maximum 2 strategic partners from the ISV that worked with us in Nexi Integrated. And we distribute the bundled solutions through the Nexi distribution footprint, including all the future investment on distribution scale up that we have seen before with Paolo. This is a fantastic way for us to drive customer value and to cross-sell on the other -- over 2 million base of terminals that we already enjoy in SME. So really combining the possibility of our distribution firepower with broader solutions coming from the ISV angle. Strategic rationale for this customer value increase, almost doubling the customer value.

Over time, increased merchant stickiness given how much is complicated to replace software is much -- is mutual -- versus moving to other players or providers. And in an age of artificial intelligence also giving us more access to data, such as the craft content, which, of course, is extremely important. As you can imagine, being a partner on Nexi and ISV is a fantastic strategic opportunity. And therefore, this again goes back synergically to the other proposition to Nexi Integrated on keeping partners very much engaged with us. This is something we already live in 8 countries with more maturity in the Nordics and evolving into the other markets with 15 partners.

This is one example for Denmark, which is Shopbox, which is the leading provider of retail solution for mainly small and midsized shops that is already live with us from the end of 2024 with a very good commercial traction and value increase. Talking about customer value. Let me just remind that we're continuously working on our both SME base on optimizing average value. And we do this via 3 different levels and pillars. The first one, of course, is facing and bundled offers. We continue to revisit price every year, more or less 20% of the overall volume based on SME. And we every year change the way in which pricing is structured in terms of bundles and leveraging also our acceptance capabilities where we have not the acquirer.

The second, typically, this leads to an increase in customer value between 20% and 30%. The second pillar is selling more stuff, so bundling more solutions, more products and so on, for example, creating stock packages of multiple terminals or extending into simple value-added services such as Nexi Smart Converters. On average, if you look at the portfolio, for example, in the Nordics, this leads to another 30% of customer value increase. The first one is cross-selling more adjacent products. You already discussed Smart Commerce, let me name another one, which is Nexi Smart financing which is merchant working capital financing that we have live in multiple markets with specialized partners that is already seeing extremely good traction in terms of customer base over 60% and with very high customer satisfaction.

We will continue to expand Nexi Smart Financing in terms of capabilities and markets over the next years.

Now let me call on stage Sara that will lead us to our strategy and solution in the e-commerce space. Sara, floor is yours.

Good morning, everyone. Great to be here with all of you. Let us take a look at e-commerce. In e-commerce, our sweet spot is the mid-market segment. So you can think of a smaller Italian merchant and a middle stand German merchant as a sort of book ends of that segment. This segment represents around 70% of the market revenue pool. Merchants in this segment are typically reasonably e-commerce savvy and very local needs oriented. So that makes them overall a good fit for Nexi's particular mix of global and local. So on the one hand, they need the type of e-commerce proposition that you need scale to build. On the other side, they attribute high value to the local servicing model that we offer them. So this, in turn, means that they have a pretty good willingness to pay for our services.

What we see in this segment is 2 to 3x the take rate that we see on a larger enterprise grade merchant. We also face less competition in this space. And perhaps most importantly, we have a great opportunity here on the back of our in-store base to upsell and cross-sell. So put all of this together and you have a great driver for growth in e-commerce as evidenced by our 2025 growth that Paolo was mentioning. So let me talk a little bit about the proposition that we offer within e-commerce. We offer a full scale, full stack, collecting solution with all of the bells and whistles that you would expect from a strong e-commerce proposition. That is combined with the local servicing model.

So that means that our customers can call a person who speaks their language, if they need to, during their integration. That also means that we offer a local product flavor to our e-com checkout proposition. So let me give you a few examples of the things that our leads and our customers appreciate from our offering. I want to start with the checkout per se. We obsess endlessly with the quality of our checkout. So that means we work continuously on removing friction from the checkout. We work on optimizing conversions of that checkout in every step of the flow. Now we can draw on a few advantages here by virtue of the length of time that we've been in our markets and by virtue of our market share.

So let me give you a few examples. If you go to account-to-account markets like Finland and Poland, we have spent years honing the integration that we have with local banks there. So take Finland as an example. 8 out of 9 banks that we are integrated to there, we see success rates between 94% and 98% on account-to-account payments. Now you won't find a lot of benchmarks online, but I can assure you that those are numbers that are really quite impressive.

In the Nordics, our brand is strong. The consumer trust is strong, and that means that we essentially can gather consent from our consumers to save their payment preferences. If you combine that with a large market share, then you essentially get a nice networking effect across all of our merchants.

In Italy, issuing and acceptance propositions, both are so strong, and we are so entrenched in the market that when we put things like click to pay into the market, we can drive adoption on consumer side and merchant side at the same time. So if you add all of this together, we have so many levers for improving the checkout flow and convergence for our customers. On the local side of things, we quite frequently survey our merchants for what are their preferences when they choose a payment service provider. It does not matter what geography we survey in. It does not matter what segment we survey or whether we survey our merchants or merchants who use one of our competitors. There is one thing which consistently comes out in the top 3 things that merchants attribute value to when they choose a provider. That one thing is the payment mix.

Now it's not so much the number of payment methods that are made available. It is the availability of that specific thing that I need in my local market with that specific quality, not so surprising really because as a consumer, I want to find the method that I trust, low-friction method and perhaps most importantly, in markets that don't have huge digital trust, and we have those across our geographies, you want to find something that essentially you trust.

It is also an important parameter to the -- sorry, to the payments -- to the price of the payment mix for our merchants. Then we derive a few advantages here by virtue of our place in the ecosystem. So the partnership that we have, for example, with Click and Vips Mobile Pay or our role in industry initiatives, most recently case in point, vero, that we are launching at the moment in Germany. So I have talked about the checkout experience. I have talked about the payments mix. So I'm missing perhaps just one component, which is also substantial. Card payments still make up a substantial part of the payment mix for most of our merchants in most of our geographies. So let me just touch quickly on the performance here.

These are overall Nexi authentication and fraud rates for card payments. We performed well in both of those areas consistently. Those are things that they are important to our profitability, but they're certainly also important to our merchant profitability. So this is an area that we continue to optimize on with the various levers and tools that are available for that.

Now let me turn the perspective a little bit and talk a bit about our profitability in the area. In general, the fragmentation in Europe and the complexity of payments in Europe is our friend. The first data point that I'm showing you here is our take rates across a series of the APMs that are most prevalent. We have indexed them at 1 for debit cards and anonymized a little bit across the APMs, but the point should still be clear. We managed to negotiate what are pretty healthy miles for us, whilst also providing our merchants with these attractive payment methods.

It probably goes a little without saying the complexity represents a moat against newcomer in the market. Perhaps a little bit less obvious, we also see that our merchants will -- our merchants will pay higher margins for us to solve the complexity for them. So we see way stronger margins when we sell combined all-in-one solution where all of the APMs get collected by us, paid out in one with one settlement report, then what we would see if you adjust the acquiring and the gateway and certainly stronger than what we see when we just sell a technical gateway and leave the complexity to the merchants of figuring out all the payment methods.

A few client examples to just perhaps make it a little bit real. [ Cup and kenna ] is a high-street retailer, they do home decor type goods in Denmark, you will find them in pretty much every shopping mall and every shopping street. They chose us a number of years ago for their e-commerce solution. They're very happy with the solution. In particular, the simplicity of the all-in-one and again, the one payout and the simplified reporting solution on the back of that. [ Sport bittle ] is an example of the German mitchelstan customer. They are an online retailer of outdoor goods and skiing equipment. They are a slightly newer customer. They came to us 2, 3 years ago, and they essentially chose us because we were able to offer and invoicing solution, white label with a series of bells and whistles, which was what they wanted for that invoice payment, which is very important in the German market.

I will finish off on technology. So you will remember that Paolo said that we are consolidating our technology base. And that, of course, is not least true very much in e-commerce. So I guess, today, standing sort of at the brink of transformation of at least some of the online shopping experience towards a more agentic-driven world. Many of you will be asking whether Nexi is ready this transformation technology wise. The short answer to that question is yes, we are. In the last 3 to 4 years, after mergering we have been consolidating our technology stack. We have obviously been choosing the most modern of our technology stack. We have been refactoring. We have been replatforming where we thought we needed to. So that essentially gives us a few advantages here.

So if we start with the customer front end, our customer front ends are built on modern frameworks and modern security standards, which means it is not too hard for us to deploy all of these AI protocols and there is a proliferance at the moment on top of that customer end point. Our business logic is decoupled, and we've built a number of new shared components in recent years. That is a great flexibility to have as we will need to innovate the proposition, business model, the service model.

And finally, when you go to our infrastructure, it is fully cloud, which essentially gives us a little bit of choice of different technology boxes when we want to move fast on something new. This is hand in hand, of course, with empowered end-to-end teams that can move fast. We use AI pervasively throughout our products and technology teams in design, in product and engineering. And perhaps the best way I can evidence that is by saying that our lead technologies within AI has not written a line of code since November.

On that, I'll pass it back to Roberto to give you an overview of our efforts in the agentic sector.

Thank you very much, Sara. Let me now, again, focus a bit on the topic of agentic and start from the broader view, in general, in Next as Paolo mentioned before, we are investing to bring AI into the efficiency angle and into the product innovation angle on a number of very different dimensions. But let me deep dive on the specific angle of agentic AI on 2 different perspectives. The first one is what we call agentic servicing. We firmly believe that as we do also our customers and our merchants are using agents to automate their own internal workflows and to create efficiencies for them into their own business logic. Therefore, we have just launched, and we will continue to extend in terms of capabilities and market coverages, a solution called MCP server that allows our merchant customers to interact with all our e-commerce capabilities via APIs in a way that is designed to enable automated workflows via agents.

We will use the same capabilities to embed a chatbot interaction within our merchant properties. But we believe that the value here lies in allowing the merchant, for example, to mine transaction data using an agent from their own properties over, for example, to use a merchant customer service to send payment links to agentic interaction. We are starting to see very much interest in the Nordic merchant on this end, and we will continue to add merchants to pilots and evolutions and to codevelop with merchants over the next months.

Moving to agentic e-commerce. I think it's important to reflect a little bit on the different parts of the purchase journey and where agents play a role and where agentic payments play a role. If you take up the classical purchase journey, you have a phase that I call upstream, which is the search discovery and consideration phase, where we already see the disruption coming from AI. And it's obvious, this is a part where the regulation is much less impactful. There is the consumer protection but not much more than that. As well, actually, there is a significant benefit from consumers in terms of speed and simplification. And there is not much trust required on that.

Ultimately, I'm asking ChatGPT to select my new running shoes, it's not something where I required a lot of trust into the capabilities of the technology. But this is a space for other industries. This is a space of the advertising industry, of the search industry where we're already starting to see the disruption happening. If you move downstream into the purchase itself and the payments, this is where the agentic payments start to matter, this is the real Nexi space. However, this is something where the regulation is much more present, especially in the European context in general, where we need to have a much bigger consumer trust into the technology because ultimately, you're asking AI to perform payment for you with your own payment credentials.

And where the jury is still out, to be honest, whether this will become relevant for every kind of purchases for more low, more commoditized kind of payments vis-a-vis bigger transactions. And this is also the space where the technology and the competitive landscape is less clear. However, we believe that this is for us an opportunity anyhow. And we are starting to invest early to make sure that we are the one that are shaping the European market in agentic e-commerce.

During the next months, we will progressively add to our Nexi check out proposition agentic payment capabilities, starting from the next few weeks with human in the loop payments and then going into full agentic payments as standards become more adapted to the European set up. We are working together with all the important players in this space to actually shape the European market, starting from Google, from the big tech angle and moving into schemes such as Visa and Mastercard. And we believe that we have made an opportunity here to be the one that leads the mid-market merchants, but also our partners such as ISVs and banks into this space.

If you really want to take the downside perspective on this consider this a threat for Nexi. Let's remember anyhow that the overall e-commerce space is 6% of our revenues and this is probably going to be relevant on specific verticals and on specific sets on average ticket, so probably much less than that. But again, we believe and we firmly believe that this will be for us a net opportunity.

Let me finish with the last segment with the mid-corporate space. Why mid-corporate is our key target for a number of reasons. The first one is that this is a space where margins are much more interesting than in larger segments. The second is this is a space of companies up to EUR 0.5 billion of revenues that really value in terms of needs, what we can offer them, for example, by ensuring that they have very high conversion, both online and in store through local payment methods by requiring seamless integration with local standards for CRM, ERP software or ECR software. And really valuing reliability, both in terms of platform reliability and of local presence, for example, for customer support and for terminal logistics.

These are companies that are often coming from the store and now they are evolving into the omnichannel space as e-commerce becomes more relevant also for them. And this is why we like to think of our solution as combining again digitalization, especially for omnichannel capabilities over time with local presence and proximity. In terms of digitalization, I would like to highlight 2 elements. The first one that we use the same SmartPOS devices with dedicated features also in this space. We have for e-commerce and omnichannel, a dedicated set of payment gateways. The Nexi name is Nexi Paygate for these solutions that are specifically targeting the enterprise needs and solutions. And we enjoy, again, as a very important value point for us.

The authorization afford rates that are superior to the market average that I already highlighted to you. On the local angle, the payment mix in terms of local schemes, but also the deep entrenchment into the local infrastructure has already been covered. I would like to highlight that even in this space, we have in each and every market solution and precise engineers that work with our sales teams in answering to tenders or to tailor-made solution into the merchant needs. We typically verticalize our Nexi unified proposition on 4 vertical solution, Nexi unified retail for the -- end and high street retail, Nexi unified Express for grocery. Nexi Unified hospitality specifically designed for the hospitality sector and the restaurant sector, also leveraging in the hotel space our strategic partnership with Planet. And Nexi Unified Go is instead targeting EV charging smart mobility and petrol industries. Very good commercial traction across markets. Also this solution. There's just a few names that entered the Nexi family during 2025. If you don't know these names, it is good because this means that we are exactly targeting the space of the mid corporates that we are designing solution and go-to-market for.

[This call length has exceeded streaming capabilities. Please refer to the preliminary transcript that will be posted shortly.]

Good morning. This is the Chorus Call conference operator. Welcome, and thank you for joining the Nexi 9 Months 2025 Financial Results Presentation. [Operator Instructions] At this time, I would like to turn the conference over to Mr. Paolo Bertoluzzo, CEO of Nexi. Please go ahead, sir.

Good morning to everyone, and welcome to our 9-month results call for 2025. As usual, I'm here with Bernardo Mingrone, our Deputy GM and Chief Financial Officer, with Stefania Mantegazza leading IR, and a few more members of our team who may help to answer your questions as needed.

As usual, we'll start with a summary of the key messages. I will hand over to Bernardo to cover the results in more detail, and I will come back for the closing remarks and, most importantly, to answer to your questions.

Let me jump to Page 3 with the summary of the key messages. First of all, we continue to deliver profitable growth for the 9 months in the quarter. Revenues are up 2.8% for the 9 months and 1.8% in the quarter. As anticipated in the third quarter, we see more material effects of the extraordinary events that we had anticipated when we provided the guidance in March this year. More precisely, we are talking about the bank losses from the past and some key bank contract price renegotiation effects. These effects will peak probably in Q4 this year, and then we will start slowing down across 2026 with a more material reduction in the second half.

The underlying growth, therefore, net of this effect, is at about 6% year-on-year, both in the 9 months and in the quarter. Merchant solutions revenues are up 2.7% in the 9 months and 0.6% versus the same quarter last year, with underlying growth being at around 5% to 6% in both the 9 months and the third quarter. EBITDA is growing at about 3.5% in the 9 months, with a 35-basis point margin expansion. The quarter results in terms of margin are a bit affected by the revenue mix that sees a stronger IS and some operating cost phasing.

Second key message: We continue to shape Nexi for future profitable growth, 3 key points that we want to underline. We continue to progress our strategy execution in the integrated payment space, the space of convergence across payments and software. As discussed in the past, our strategy is based on partnerships with ISVs. And since the beginning of the year, we have added about 50 partners, ISV partners to our pool, that is about 500 across all our geographies.

Second key message that we want to reiterate, we continue to build a stronger multichannel approach to the Italian market, obviously, deleveraging our very strong partnerships with the Italian banks, but also adding to this strong channel also complementary channels, targeting more precisely SMEs, which is our core focus. And these complementary channels by now represent year-to-date about 26% of our total new sales.

Last but not least, we want to underline that merchant solutions in Germany is growing double-digit in the 9 months, with even acceleration in the third quarter, supported by customer base and market share growth. And we really want to stress this performance in Germany because, obviously, there's a lot of debate around how strong players like Nexi are in competing with the newer players focused on SMEs, the single platform, and all of that. And clearly, the performance in Germany shows very well that we can compete, we can win effectively and have accelerated growth as well.

The third key message we want to deliver is that we continue to create value for our shareholders. Across '24 and '25, we did delivered EUR 1.1 billion of capital to our shareholders while becoming, at the same time, an investment-grade issuer since the end of last year. Net financial debt is now down to 2.6x EBITDA, notwithstanding the fact that we have returned in the year already EUR 600 million to shareholders as a remuneration, which is a 20% increase versus the previous year. Obviously, in March '26, we will talk about the capital allocation for 2026 on the back of the more than EUR 800 million cash that we will generate in 2025.

Coming to guidance, we confirm we will land revenues in the low to mid-single-digit year-on-year growth space. We confirm that we will generate excess cash for more than EUR 800 million with a high degree of confidence. As far as the margin is concerned, for sure, it will be positive with Q3 with Q4, by the way, seeing a margin expansion better than Q3. Where it will land precisely will depend on the volumes we will see in Q4 and the business mix that we will see in Q4. In any case, we are talking about only a few million euros here and there.

Let me now hand over to Bernardo to go through the results more in detail.

Thanks, Paolo. Good morning. Starting on Slide #5 with revenues. As Paolo has already mentioned, this quarter was significantly impacted by discontinuities as expected. This has been accelerating throughout the course of the year. You can see the revenue growth in the quarter of 1.8% is distant from our underlying growth of 6%, and this gap is widening compared to the 9 months. So, as we said, this is the highest impact we've had year-to-date, and the peak is expected to be reached in the coming quarter.

With regards to EBITDA and EBITDA margin, EBITDA is growing. The margin, and please remember, we're always talking about an EBITDA margin north of 57%, suffered in the quarter from what I would characterize as a slightly different revenue mix than what we might have planned with a bigger contribution coming from issuing the merchant solutions and also a bit of phasing effect on some costs, which might have spilled over from one quarter to the other, which is impacting the margin accretion. However, for the year, we are positive at 35 basis points.

Moving on to merchant solutions on the next slide. We have growth in the quarter. Again, here, this is the business unit on which the negative impact coming from the discontinuities we've talked about that impacts us the most. You can see the underlying growth is mid-single digit. Overall, I think we can point to continued growth in international scheme volumes, albeit with a softer summer. We have a slightly unfavorable volume mix, as I was mentioning earlier, as a group, but also within merchant solutions, with some pricing and mix effects in e-commerce in Poland. We're talking about -- sorry, just a few million euros here, but that makes a difference, obviously, in terms of year-on-year growth. I think more importantly, from a volumes perspective, Poland, but more importantly, also Germany, which is growing in the quarter in the mid-teens, have shown a robust performance.

We continue to grow our franchise in the most valuable segment of SMEs. We continue to upsell and cross-sell the value-added products and services. And indeed, we're making progress on the ISV partnerships front with more than 50 signed in the 9 months and the year-to-date. Issuing solutions had a very strong quarter, 6.5%, 6.6% growth. This is usual. It is being sustained by volume growth, the international debit product in Italy, upselling, and cross-selling throughout the group. I think it's fair to say that part of this higher performance in the quarter than for the 9 months will be reversed in the fourth quarter. We expect it to benefit less from year-on-year project work, which, as you know, as we've discussed in the past, it's very hard to predict in which quarter they will be booked. And we're also expecting in the fourth quarter to see the first effects of some in-sourcing from a large Nordic client that we've spoken of many times in the past. This is something a decision which goes back 3 or 4 years and has been postponed a number of times is now kicking in. So, the fourth quarter is softer than the third, but a strong year-to-date and expected for the full year in any event on issuing.

DBS is the business unit which has the most reliance on, let's say, project work or one-off billings. So, it's lumpier. I don't read too much in the quarterly performance. Overall, for the year, we expect growth and a good performance from the business unit. Indeed, we recently launched in October, a very important piece as part of our payments business, the verification of PE, which affects hundreds of banks across Europe. We're the largest player in the space, and this was a big success for us. From a geographic perspective, it doesn't surprise -- shouldn't surprise that Italy is the region which was impacted the most by the discontinuities, the Italian banks that we've spoken of so many times. Nordics, I would say, good performance in the low single-digit area, but benefiting from continued progress on selling value-added products and services to our client base. DACH, I would say, very strong performance in Germany, slightly less so in Switzerland, but overall, good performance from the region and CSC, which is probably the most impacted by the softer summer and what I said earlier about Poland.

Finally, before handing the floor back to Paolo, on costs. Costs grew about 3% in the quarter. HR costs still showing the benefits of the initiatives which were put in place last year and continue to be implemented during the course of this year. Slight growth coming on the non-HR costs, which is the one most impacted by volume growth, by inflation, by the growth of our business in general. But as you know, we manage our cost base as a whole. And you can see the 2% growth for the 9 months is pretty much in line with our expectations, and I don't expect the final part of the year to be any different. Actually, the fourth quarter expect to be better than the third and probably better than the 9 months to date. So, I think other than the phasing effect, which I mentioned earlier, which has to do with intra-group VAT and the timing of these things. And again, we're talking about a few millions of euros here and there. I would expect strong cost performance for 2025.

So let me hand the floor back to Paolo for his final remarks.

Thank you, Bernardo. Let me just reiterate Page 11, the messages that I already anticipated on guidance. We will end our top line growth in the low to mid-single-digit space with underlying growth acceleration. Cash -- excess cash, will generate at least the EUR 800 million that we committed to with a high degree of confidence. And as far as the margin is concerned, for sure, it will be positive. We expect the Q4 performance in terms of margin expansion to be better than Q3. Where exactly it will land will depend on the dynamics in Q4. But in any case, we are talking about a few million euros shifting here and there.

Let me close from where I started, 3 key messages on Page 13. We continue to deliver profitable growth across the business. We continue to shape Nexi for future profitable growth. And again, the 3 topics that really want to underline is the progress in integrated payment space across geographies, the continued acceleration of the newer channels in Italy together with continued good performance of the bank partnerships as well. And last but not least, a very strong performance and improving day by day in Germany for merchant services. And last but not least, continue to stay very focused on value creation. We're returning this year EUR 600 million to our shareholders in March. We'll talk about what we will do for 2026 on the back of a strong increase of excess cash generated in 2025.

Last but not least, let me anticipate and invite you actually to the Capital Market Day that we will have at the beginning of March, more precisely, the current plan date is the 5th of March. Let me stop here, and let's open to your questions.

[Operator Instructions] The first question is from Grégoire Hermann, Barclays.

Just 3 of them, please. Just on the guidance, can you confirm whether you need reacceleration in Q4 to meet the EBITDA guidance or simply the cost reversal that you mentioned that you expect in Q4 is enough for you to meet that cadence? And then I think on the revenue, the guidance still leaves a pretty wide range for Q4. Can you comment whether you expect a reacceleration in Q4 there? And finally, on issuing solutions, you mentioned some phasing effects -- would you be able to quantify this phasing effect, please?

Greg, this is Paolo. Thank you for your question. Let me just comment on guidance, and then I'll pass to Bernardo on the issuing effect. As both Bernardo and I said, in Q4, we expect to see the peak of these extraordinary effects. And therefore, it's going to be difficult unless we surprise ourselves to see an acceleration of revenues in Q4. Nevertheless, we expect to see positive revenues in Q4. And in particular, we expect to see some instead acceleration from merchant services. Again, it will depend very much on November and December that, as you know, are very much peak months in our industry. While as anticipated by Bernardo, we've seen some reversing on some phasing in issuing that instead in the Q4 will perform not as good as in Q3 and year-to-date. Let me pass over to Bernardo.

Grégoire, I mean, as Paolo was saying, I think let me just add to his comments. I mean, in terms of the evolution of revenues during the course of the year, I would highlight what we put in the slide in terms of the underlying revenue growth, which has been pretty homogeneous throughout the quarters. Quarter 1 was probably a little lower than Quarter 2 and Quarter 3 was similar to Quarter 1 in terms of the underlying. And that's pretty homogeneous. Where you get the big gap between reported and underlying is this effect of banks which are exiting. And I think we spoke of this other times. I mean we do our best to slow this down as much as possible to hold on to clients which are being migrated from our platform to others as much as possible. But the impact of this is that we have a longer period of time in which there's a gap between underlying and reported. And the shape of this curve, this gap is very hard to predict. I mean it really depends on our efforts and also on the banks trying to migrate these customers' efforts. So, it's very hard to call the basis point how it's going to impact.

However, with regards to issuing, going back to the issuing question, we're talking about single-digit million euros of impact coming from project work, which was probably in the fourth quarter compared to the -- or gap between year-on-year fourth quarter and fourth quarter at this point compared to third quarter and third quarter because that's what we're talking about. And we have a similar impact, something which is less than EUR 10 million in a year coming from the migration away from this Nordic customer. So how quickly they migrate away from us, I mean, it's really up to them and how that impacts us in the fourth quarter, we will see. But those are the 2 impacts.

The next question is from Josh Levin, Autonomous Research.

Two questions from me. First, any views on what PSD 3 and PSR might mean for Nexi and the broader European payments landscape? And then second of all, I guess it's refreshing to have a call where the scripted remarks don't talk about AI. But to the extent you can, are you able so far to internally quantify the impact of AI on any of your unit economics?

Thank you for your both questions. Actually, we don't talk about that a lot in the call, and I'm very happy to cover both. PSD 3, PSR, I think, we don't see any material effects directly on the business and so on and so forth. If anything, we see some positive effect because the new regulations are creating further complexities into our business. And ultimately, our company is in the business of simplifying payments for our customers, being merchants, corporates, banks and so on and so forth. And the reality is that the more complexity is around, the better positioned are large players like us versus the smaller ones that normally struggle to follow through on the complexity. So, in general, we believe this is going to be something positive for us. On AI, we are all in, in AI since, I would say, 1.5 years ago.

This year, we already see the contribution across, I would say, mainly technology expenses, both CapEx and OpEx for double-digit million euros. Let me not be precise in this specific case. For next year, we are planning much more than that, and this is across technology development, software development, software testing, infrastructure management, operations, onboarding, marketing, back-office processes, general productivity. We are all over the place on this. And we really believe that this will be a great contributor to increasing efficiency across the company and also obviously enabling us to invest more into growth over time as well as supporting continued margin expansion and cash generation.

Obviously, we are also very much into leveraging AI for product innovation and differentiation. And most importantly, we are deeply into the topic of Agentic commerce, which, as we all know, will become relevant over time for the e-commerce part of the business. And on this front, we are participating both on the big tech initiatives. We are one of the few European companies cooperating with Google in the setting of the new standards on the Agentic side of commerce. But at the same time, we're deeply involved with international schemes, Mastercard and Visa in setting the future rules that are fundamental in defining how Agentic commerce will work. And clearly, this will be very much also European-specific or in any case, continent-specific because they will have to be consistent with European regulation. And again, given the position we have, we believe we are in a good place to be able to shape this and be a protagonist in this space as well.

The next question is from Hannes Leitner at Jefferies.

Can you give us an update on the Sabadell joint venture given the Spanish banks have been not merging? And then can you talk about the 2026 expectation? Current consensus is just looking for a slight acceleration, but your headwinds with the Italian banking contract should come out of the base. So maybe you can talk there a little bit about the expectation from project work, the issuing contract ramping down and the underlying market trend growth you see, that would be it.

Let me take both questions. Sabadell, finally, after, I think, 2 years, we have seen what has been the conclusion. Sabadell remains an independent bank. We are obviously happy to see it. And again, here, let me lay down the facts as clearly as I can, even if we discuss them in the past with many of you. First of all, we have no commitment whatsoever any longer across the 2 of us because this was an old deal that was happening in old market conditions. And therefore, there is no obligation any longer among the 2 parties. We are in great relationships. a great relationship, and we have agreed this very, very friendly. At the same time, we continue to consider Spain an interesting market for a company like Nexi.

And honestly, we continue to consider Sabadell a fantastic potential partner in Spain, given how focused they are on payments, given how focused they are on SME, given how deeply entrenched into the local ecosystem they are. And therefore, we will continue to have conversations with them to see if there are new opportunities to do something together on completely new terms, potentially also completely different business model. So great relationship, still interested in doing something at different terms. We will see. We'll see where it lands in the coming months. We are very, very relaxed about it and actually happy to have the opportunity to have the conversation.

As far as 2026 is concerned, obviously, as you can imagine, we are working on our budget for next year. We'll talk about it in March together with the guidance. I can only reiterate what both Bernardo and I said as far as risk is concerned, we should always remember that our performance this year is materially affected by these exceptional events. And therefore, the dynamic will really depend on how these events come into place and then unwind over time. As we said, we see these events peaking in Q4 this year, then continuing at a slightly lower level in the first half of next year and then slowing down towards the last part of the year. Therefore, we would expect this - the overall effect on a yearly basis to be probably a bit less than what we have seen this year, and this should support with our underlying growth continuing should support some acceleration, but this is a topic for March.

Maybe just a quick follow-up on German performance. Was this kind of also driven by one of your competitors basically being in the spotlight with credit downgrades? Or is that all organic initiatives?

No, no, no. It's all organic initiatives. This is growth coming from effective products in the market, competitive products in the market, a strong focus on the most valuable segments being SME and in particular, the mid- part of SMEs and the more national corporates, mid-corporates, supported by a strong and focused investment in go-to-market and in sales and honestly, a strong team in place in the market. It's all organic. And by the way, we are winning not just against, I think, the incumbent you in mind, but a little bit more across the board. Maybe coming back on your questions around guidance into next year. As I think we have anticipated in March as well, this year, a lot of the effect that we have seen from these exceptionals has to do with merchant services in Italy in particular. Next year, we should see less impact into merchant services and more into issuing given this phasing. So, let's see how it evolves.

The next question is from Sébastien Sztabowicz, Kepler Cheuvreux.

On pricing environment, you mentioned a little bit more pricing pressure in Poland, if I'm right. Have you seen any kind of changes in the competitive landscape, new players being a bit more aggressive in some of your markets, whether it is traditional PSPs or some digital players or commerce platform coming to the market? That would be the first question. The second one, in terms of contract renewal, do you have any major contract renewal coming into the next 12 to 18 months to understand if there is more downside risk to your revenue on top of what you expect already from the contract ramping down at Banco BPM and other discontinuities?

Thank you for the 2 questions. On pricing pressure from new players and so on and so forth. I think what we are seeing in Polish e-commerce that again, we're really talking about a few million euros here, which just made it explicit to you and transparent to you because in the quarter and in the region. In merchant services, they have some -- a few basis points impact. But in the scheme of things, that are totally marginal. Honestly, we don't see any major change in dynamics. Obviously, there is more pressure in various countries from these newer players more focused on SMEs. We are competitive in the market. We have to stay competitive. We do what we need to stay competitive. I think the performance in Germany is showcasing it very well. Poland, we continue to take share also in this environment. Obviously, in places like Italy and Denmark where we are by far the leaders in the market, we are more attacked by these players that we are, by definition, the more visible ones. But that's the reason why we are ramping up our direct sales channels next to the -- and in partnership with the bank ones to help us remain and stay competitive versus these players that normally have a direct go-to-market as well. So, we believe we are overall well set up to compete in that space, and we will continue, obviously, to invest to stay competitive.

As far as the second question is concerned on contract renewals, I think we did comment a little bit on this topic last time. We have won the renewals on 100% of the deals that were up for renewal over the last 15 months by now or something like that. I think we said 12, 3 months ago. So, I guess now it's 15%. Going forward, we see much, much less of potential renegotiations or situations coming. I think probably the one that is worth mentioning is going to be the renewal of the Monte dei Paschi distribution agreement on the book in 2027. We have a great relationship with the bank and don't forget that the book is ours. So, we're really talking about the distribution agreement because we did buy the merchant book back in 2017. So, but obviously, we will do whatever we can to continue the great relationship we have with them, and we just renewed other contracts with them only a few weeks ago.

The next question is from Aditya Buddhavarapu, Bank of America.

Could you just clarify the comments on Q4? Did you say at the beginning of the Q&A that you expect an acceleration in merchant services? Maybe I didn't fully capture that. So, if you could just clarify that. And then also just related to that, can you talk about what you've seen so far in Q4 in terms of volumes? I know October is probably a smaller month, but any color on what you're seeing on volumes or the broader macro would be interesting. Second question, you talked a lot about the ISV partnerships, and you have about 500 in place right now. How big are those partnerships in terms of your overall volumes today and how fast are they growing? Any color would be appreciated. And then finally, just on the underlying acceleration you talked about in 2026. Could you just talk about again the drivers there? What should help to improve that?

Let me take the 3 of them. Q4 MS reacceleration, probably, yes. We are talking about small numbers again here. Let's be clear. We're always talking about a few million euros shifting here and there. And that should be supported by the various initiatives that we are doing, but also from the fact that at least in Italy, in terms of volume, we should start seeing some reversal of the strong impact that we had so far on MS, in particular, from the Banco now recently from the Cassa Centrale. So that should happen. As we also said, instead we will start seeing more impact on IS over the next few quarters. Then let's see what happens. If I look at the volume dynamics in October in Italy, we already see a little bit of better volume growth. So, it looks like it's moving in the right direction. But again, very early to say. Again, never forget that the fourth quarter is really, really shaped by what happens at Christmas and Black Friday. So, let's see what happens.

On ISVs, it's difficult to give a number because the classification of what an ISVs versus an ISO versus an ECR provider is very, very complicated. So, we don't want to be stuck to numbers that then change over time and then confuse you. Let me just give you a little bit of the flavor here. We are talking a lot about this topic because we believe that long-term, it will be impacting our industry also in our geographies. However, this is a topic that in terms of overall impact is extremely small and fragmented across Europe at this stage, at least the Europe that we see. Nothing to do with the U.S. It's coming slowly. It's coming in a very differentiated way across the various markets. This topic of ISVs and therefore, the materiality of it is more visible in the Nordics, where this started a bit earlier. As you know, the Nordics are super digitalized as economies and therefore, also SMEs are digitalizing faster. And that's the reason why we see it there faster as a dynamic.

Germany is very much behind the Nordic situation, even if we start to see obviously more focus there. In Germany, what is still big is ISOs, resellers, these types of dynamics, which are not precisely IVs. Poland, I would say, is more or less in the state of Germany. And last but not least, Southern Europe, Italy, but also Greece, Croatia and the other markets where we are present, this is really, really, really small. Obviously, we are working to take position, but you hardly see these volumes. A lot of players are trying to get organized to do this, but they are still in the process. And obviously, we are in the process of working with many of them. As far as 2023 is concerned, I can only reiterate what I said before in terms of the market risk dynamics. Again, as we said in the past, we see our underlying growth remaining solid in the mid-single-digit plus and ideally accelerating on the back of the market share gains here and there, plus the initiatives to increase value for our merchants with softer merchant financing and the various topics we discussed in the past. The profile of precise will, therefore, depend very much on what happens on these exceptional events that we discussed in the past. Again, as I said before, this should ease out, especially towards the end of 2026. If it happens the way we see it happening as we speak, the overall impact should be a bit lower than this year. And therefore, this should support some reacceleration. But again, on the back of strong underlying.

The next question is from Alexandre Faure, BNP Paribas.

I have 2, 3 questions, if I may. One is going back on this commentary you made on both discontinuities having reached or reaching peak pressure in Q4. Just a little surprised because to your point, it feels like issuing will come under pressure next year. You mentioned that renegotiation in the Nordics, but I think Banco BPM was also supposed to migrate off next year? So, is this being pushed a little bit? Just trying to get a sense of the latest timing there.

And maybe relating to that, how should we think of any potential lingering margin headwind if we have some of those lucrative relationships continuing to dwindle in 2026? And my last question is completely separate topic that you touched on earlier, Agentic Commerce. Just curious, Paolo, how you think about it more broadly, looking maybe 3, 4 years out? Would you view this as an opportunity to take further share away, maybe from banks who might struggle to keep up? And beyond share dynamics, how would you view Agentic Commerce impacting yields and margin. I think there's more work you need to do, maybe you'll be able to price for that. So, any thoughts there, much appreciated.

Alexandre, thank you for your 3 questions, or maybe 2 plus 1. First of all, on the discontinuities in Q4, again, we don't have full control of the phasing of all these things. You're right in saying that most of the effects from Banco issuing are expected at some point into next year. To be honest with you, we don't have a full visibility because we understand the supplier they've chosen is behind plan. We may start to see something on a part of it in the last quarter. But again, it's not just Banco. There are smaller things as well. So that is why, if you combine everything, we expect to see the last quarter this year as the one with the highest impact. And again, as I said, into next year, then from this peak, we expect to have basically the first and the second quarter starting to slow down, probably more similar to the third quarter this year, and then instead having a material reduction towards the year-end. But again, the exact phasing is not depending on us.

And by the way, we fight as much as we can to make this happen as late as possible and as small as possible. As far as margin headwinds into next year, clearly, this dynamic put pressure on margin. The simple fact that we will expand EBITDA margin this year tells you that as we do all of that, we also have a number of initiatives that increase margin, that the new things we are doing are margin contributing. And by the way, we continue to do a pretty hard work on efficiency as usual, but obviously, even more in the case of the environment we're in. And that's one of the reasons why I think, as I was answering to the question of Josh, in the very beginning, we are so focused on AI and lever also to create space for margin expansion and also reinvestment.

As we look into next year, this is exactly what we're looking at. I think ultimately, we're we'll be landing on margin next year will depend very much also on where and how much we decide to invest ourselves into the various topics that we have been talking about in this call as well. Agentic Commerce, listen, I think it's a super fascinating topic. Let's be very clear. I think if people tell you they know exactly what will happen, how it will happen, and so on and so forth, they may be stretching it a little bit. It's super complex. And by the way, to a certain extent, we like complexity because, as we said in the past and also today, it's always an advantage for people that are really focused on that scale with competence in this environment. But let me try to add a few comments here. First of all, never forget that ecommerce for Nexi is maybe unfortunately, a relatively small thing in the sense that we are talking about 5% to 10% of our total revenues, growing nicely. And this is clearly one of our growth engines, but is a relatively smaller part of our portfolio, point # 1.

On that basis, we see, as you mentioned rightly so, this complexity potentially being an asset for us because, again, the smaller players, the banks in general, will struggle to be a part of this "Potential revolution in ecommerce". Clearly, our partner banks in Italy will benefit from our efforts, and we'll be partnering with them also on this front. I want to be very, very clear. But never forget that ultimately, we are partnering with banks in Italy, Greece, and Croatia elsewhere. Banks are competitors. And therefore, we believe that we really struggle to keep up in this space, or at least many of them.

To be honest with you then, how this will develop will depend very much on customers. And when I'm talking customers, I'm talking about consumers, the ones that buy stuff. Because if you really want to be extreme version of Agentic Commerce, which is the one where not only you start the commerce activity from AI, from agents, but you complete the transaction, including the payments in an agent-to-agent dynamic, that really requires a big leap of faith from the customer that basically has to trust an agent fully for spending his or her money. And I think that this is maybe one day possible, maybe for certain verticals and product categories. But honestly, how big it will be in the future, I think, is really something that we will need to see.

In any case, we are investing in this space, and we will be organizing ourselves in this space for obviously, enabling merchants in any case to be able to interact with agents, because maybe it is going to be just a small thing. But our role is to help merchants to accept any type of transaction, any type of payments, also the ones coming through agents. At the same time, we're already working on what we can do on the issuing side to make sure that our products, our cards are Agentic Commerce-ready. Therefore, we see a lot of work that we can do to enable all of this. I'm sure we'll talk about it again many times in the future.

The next question is from Justin Forsythe from UBS.

Just a few here for me. I want to hit first fiscalization in Italy. If I'm not mistaken, I believe that's meant to take place and become enacted, I believe, January of next year. Do you see that as a potential forcing factor for greater adoption of software-led payments in Italy and/or potential for Nexi and Nexi's ISV partners to grow? Second question is around the Zip Pay partnership in Ireland, which I believe you helped roll out this application within your DBS solutions business. Maybe you could talk a little bit about how you won that, what the monetization and rollout timing looks like there? And just more broadly speaking, how you see the go-forward opportunities within DBS. And whether you see this as a business line that's strategic to you longer-term and add synergies across your other business lines? And maybe updated thoughts on what you plan to do with that asset, if anything? I know there's been some news on that subject.

And finally, just a real quick cleanup question for you, Bernardo. If I have the math right, it seems like you had 0% growth in international schemes in the quarter. I know you noted some softness in Southern Europe. Also, I'm sure that has to do with the bank M&A as well in MS. But maybe if you could provide a normalized number there and/or also, I know we were commenting on trends in October month-to-date. Maybe you could add Germany and the Nordics to that as well, if you don't mind. Thank you very much.

Hi Justin, I'll let Bernardo take the last question. On fiscalization, yes, it's right. It's happening. It will happen in a few months, but it will happen in such a way that will not require merchants to change neither the cash register nor their acceptance solutions because the reconciliation will be done by the tax, basically authorities, the tax authority technology in basically the cloud. And therefore, the only thing that merchants will have to do is going to be to connect in the cloud, to associate in the cloud, their cash register, which is already connected. Don't forget here, maybe let me make one step back because -- so that everybody can follow this conversation. In Italy as well as in other places, there is already the obligation to have your cash register connected with the tax authorities, okay?

The new news that will be implemented into next year is that there will be a connection in between what the terminal is transacting on digital payments, the point-of-sale terminal and what the cash register is registering and is transacting. And this connection in between -- clearly, this is intended to avoid certain behaviors for tax avoidance that we're playing with the 2 devices being not connected. Now this connection will happen in the cloud. And therefore, there is no need for changing the ECR. There is no change for changing your cash register. There is no need to change your acceptance solutions, your point-of-sale terminal. The connection will happen in the cloud. The merchants will simply need to register in the cloud the 2, if you like, components and associate the 2 of them. Obviously, we will be helping. We're already helping the merchants that we will be able to do it with Nexi in one click through our digital assets in the cloud, okay?

Around the market, as you can imagine, you have some ECR vendors that are claiming that you need to change everything and so on and so forth. But honestly, that's a marginal, I would say, commercially aggressive behavior, but that's not -- that's absolutely not needed. So, we believe that this dynamic of digitization of merchants will continue with its own pace that in Italy so far is relatively slow. And honestly, we will try to accelerate ourselves through our partnerships with our own initiatives but should not see a material change because of digitalization.

On this account-to-account instant pay-based service that we have developed with the Irish banks, I think it's a nice service. We are very proud of being chosen by them and by a number of other countries also outside of Europe. I would love to tell you it's big and growing. The reality is that it's relatively small, you don't sit into the big scheme of things, but it is something that, again, we are very proud of and we'll continue to pursue because ultimately, whenever we are chosen by central banks, and we're chosen by bank consortia is always a great testimony of the value that we can create and how deep we are into technology and modern solutions.

As far as DBS is concerned, more broadly, we are where we were every single time we talked about it. There are areas of this business that are less strategic, and we'll continuously review the portfolio and pursue certain potential sales. But again, this has already happened, will continue to happen on a one-to-one basis. Last one, Bernardo.

So Justin, I think I presume you referred to that 1% growth of value managed transactions in the 9 months that we reported is on Slide 6. I couldn't find the 0% you're referring to. But I think your question was ---

Bernardo, just to clarify, I was just saying that international schemes in the 9 months was -- what was it, about 5%. And I think that implies something close to 0 for the 3Q.

Yes. Okay. Fine. I mean it's -- in general, I mean, there's a recast, as you can see in the database due to the fact that we're aligning, let's say, the -- as we re-platform across the group, in particular in Italy, we have recast some of the historic volumes just to make sure they're 100% aligned with the revenue. I mean the revenues were always 100% correct. The volumes, maybe we had more than -- we were calculating maybe more than 1x some kind of volumes because they were driving certain revenues. And that probably gives you the impact you're referring to. But in general, I think the crux of the question was about the impact of the banks that are leaving the portfolio. So, the underlying, let's say, volume. And I would say that in Italy, that weighs probably 5 percentage points more or less, and it's about half that at the group level. So, if you look at it at the Italian level, it's twice what it is at the group level.

And the last piece of that was just on the Nordics and Germany in October, if there's any additional comments there. Thanks.

In October, Germany, as we mentioned, for the first 9 months for the third quarter is performing very well, mid-teens in terms of growth. I think the acquiring volumes are strong. Post terminals may be lumpier. But in general, I think even October is a strong month continuing on the -- like the rest of the year. And Poland, if you look at physical acquiring and ecommerce, both volumes are strong. As I said, when we called out Poland, we're talking about more of a pricing stroke, let's say, shift to marketplaces, larger customers on ecommerce compared to smaller customers, which has a pricing effect. But on volume growth, Poland is performing pretty well as well.

I think in general, the way you should see it, Justin, is Nordics trailing around mid-single-digit volume growth, maybe a bit short of that, but around mid-single digit, which is pretty good for a market that is already penetrated where we have a strong leadership position. And instead, Germany and also Poland, by the way, in the high single-digit type of space.

The last question is from Gabriele Venturi, Banca Akros.

Could you please comment on potential risk and impacts that could arise from possible M&A developments that could involve Credit Agricole Italia and BPM or BPM and the new Mediobanca Monte dei Paschi? Thank you.

Well, listen, you know better than I do that the situation is super, super open, and there are many options that we can read in the media, then obviously, we are just spectators to all of this. The only thing I can comment is that we have a very strong partnership with Credit Agricole that has just been renewed for the next 3 to 4 years across issuing and acquiring to 2029 and the performance with them is super strong and relationship is great. Same goes on for Monte dei Paschi, where, as I said, we just renewed a part of the issuing contracts.

The other part is longer-term, and we'll have in the coming months a conversation on how to extend the merchant book distribution agreement while the merchant book itself is already ours. So, both parties, we have strong relationship. You know where Banco is eating to. So, let's see, it's very difficult for us to provide any further comments. We are, I think, in a strong position with both Credit Agricole and Monte dei Paschi.

Mr. Bertoluzzo, there are no more questions registered at this time. I turn the conference back to you for any closing remarks.

Well, thank you again for attending this call. And most importantly, looking forward to seeing you in early March for not just results, but for the Capital Market Day. We plan to have in the same day a quick update on Q4 results, but then obviously looking to strategy and longer-term outlook for the company. And in that context, we will provide the guidance for 2026 and also capital allocation, our commitment for 2026 on the back of a very strong cash generation this year that is expected to land with EUR 100 more million of cash generated versus last year.

Thank you very much and looking forward to seeing you over the next few hours and days in many conversations. Thank you.

Thank you. Ladies and gentlemen, thank you for joining. The conference is now over, and you may disconnect your telephones.