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Good morning, ladies and gentlemen, and welcome to TeamViewer's Q1 2026 Earnings Call. I am Bisera Grubesic, Head of IR here at TeamViewer. And today, I am joined by our CEO, Oliver Steil; CFO, Michael Wilkens; and CRO, Mark Banfield. Oliver and Mark will run you through the quarterly business update, and Michael will present Q1 financials. The presentation will be concluded by a Q&A session.

As per usual, kindly note that you can find the important notice and the APM disclosure on Slides 2 and 3.

And with this, I hand it over to Oliver to kick off our presentation.

Thank you, Bisera. Good morning, everyone. Also welcome from my side. Thank you for joining us today. 2026 is the year of delivery and Q1 was the first proof point. Top line was broadly stable and profitability was strong as expected. The building blocks for acceleration in the second half are firmly in place, and we are reaffirming our full year 2026 guidance.

The 2 effects that moderated our Q1 results, the one-off 1E customer churn and our SMB course corrections have been shaping out as flagged in February. Good visibility gives us confidence in the ARR growth acceleration, which is expected for the second half of the year.

Strategically, we are focused on where the highest ROI and future upsides are while we continue to benefit from strong cash generation in the core SMB business. We are leaning into higher-end SMB and Enterprise, where we see clear demand and willingness to pay for premium capabilities, including AI.

Looking at the underlying business, Enterprise ARR grew despite absorbing the anticipated one-off churn in 1E. If you strip that out, then Enterprise ARR would have been up by 11%. The core is performing well. Mark and Michael will take you through the details shortly.

TeamViewer ONE is gaining real commercial momentum. Its ARR doubled quarter-over-quarter. The Enterprise tier was launched in February, and it closed its first deal almost immediately. The value proposition is clearly resonating at the top end of the market. We are building market-leading Autonomous Endpoint Management innovations, which will expand our total addressable market meaningfully. What connects these proof points is a single direction of travel. Customers are moving towards autonomous IT operations, and TeamViewer is the platform they choose to get there.

Let me now take you through the details starting with how we see ARR across our base. I want to take a moment to explain how we are presenting this chart because we have refined the view from what we have seen before. We have kept the customer groupings that you are familiar with, SMB and Enterprise. And we've broken them down in a way that we think is more useful to understand the underlying dynamics of the business. We wanted to be clear about exactly where we are facing challenges and where we are not. And here, you can see that the message is encouraging. Approximately 2/3 of our ARR base is healthy and growing.

Let me walk you through the 4 customer groups. Enterprise excluding DEX grew 18% in constant currency year-over-year, representing 24% of total ARR, continuing the strong double-digit momentum that we saw throughout 2025. Higher-end SMB accounts, which are between EUR 1,500 to EUR 10,000 contributed 35% of ARR and grew 1%. This is a large base of customers with real upsell potential.

The 2 areas that face challenges are exactly the ones which we flagged before. DEX ARR was down 16%, driven by the one-off customer churn of 1E, which is confined to Q1. If you strip that out, then Enterprise ARR overall would have been growing 11%, not 8%. Within lower-end SMB, which accounts below EUR 1,500 ARR, ARR was down 6%. This reflects the impact of our last year's deliberate cost corrections to revitalize the business. Both headwinds, the one-off churn in 1E and the SMB course corrections are known, anticipated and fully reflected in our 2026 guidance.

The core of the business is performing well. This is where we've made significant investments, and we have not yet even seen the full commercial impact flow through yet. TeamViewer ONE, Autonomous Endpoint Management or the TeamViewer Intelligent Agents, these products are still in their early innings commercially. This is a very strong foundation to build on, and we expect the momentum to increase. Notably, net upsell from SMB to Enterprise was EUR 10.5 million in the quarter. This demonstrates again that our strategy to migrate the most valuable SMB customers into richer product packages continues to drive growth. And the primary engine of this growth is and will be TeamViewer ONE.

Let me walk you through TeamViewer ONE, as this is where we are investing significantly, and which is driving the commercial story of 2026 and beyond. What you see on the left of this slide is the product architecture. There are 3 tiers: standard, advanced and enterprise, and they span from SMB through to large enterprises. The products are all built on the same core stack of Tensor, DEX and AI. While the tiers assemble our core offerings for each customer group, across the board, we are delivering what our customers are increasingly looking for, a simpler unified platform that reduces complexity, enables predictive problem solving and supports the move towards autonomous IT operations.

The right side of this slide tells you what is happening commercially, and the trajectory is clear. In October, daily average billings were only EUR 4,000. By March, they reached EUR 45,000 already. What excites us most is the pace of that rapid increase. Let me point out 3 key milestones in this chart.

First, the December release of the major standard and advance update gave the first real commercial push. And you can see that billings step up meaningfully from that point. Second, in January, dipped as expected with normal seasonality. Third, and excitingly, February and March showed a clear execution ramp after our sales kickoff. The sales force came out of Munich energized with a playbook that works and a product that addresses a key need of our customers. That ramp is real, and it continues to build.

The enterprise tier launched earlier this year. And as you can see in this chart, only 2 months in, it is already contributing meaningfully to that March number. The fact that we are closing this quickly when sales cycles typically run much longer is a strong early signal that the value proposition is resonating at the top end of the market. All in all, this early commercial momentum confirms customer demand and marks the beginning of our transition to an endpoint-based pricing model from seat-based pricing.

To understand where this goes from here, it is worth looking at what we have achieved before. This chart here demonstrates our ability to repeatedly up and cross-sell our products. I want to spend a moment on it because I think it's one of the most important frames for how to think about TeamViewer ONE's commercial potential. What you are looking at is illustrative annual recurring billings per upsell motion since 2018. Each layer represents a distinct growth rate. We identified an opportunity to build the product and go to market and executed the upsell at scale.

The first wave was Perpetual-2-SaaS. We migrated a large global customer base to recurring SaaS licenses across all products. This was a fundamental commercial transformation.

The second wave was driven by corporate channel upgrades. As customers scale their usage, we grew with them. This sounds straightforward, but it required the right product market pace with continuous innovation and a disciplined sales motion to capture the potential at scale.

The third wave is Corporate-2-Tensor and is still very much alive today, a functionality led migration of corporate customers to our advanced Tensor licenses, purpose-built for enterprise IT environments. This meant higher value and higher stickiness. Tensor went from initial traction to a core share of Enterprise ARR within 6 quarters, driven by a strong value proposition and focused commercial execution.

TeamViewer ONE is the fourth wave, and I believe it is the largest and most exciting opportunity we have had. We are at the very beginning of this wave, but early proof points confirm that the journey has started. We know how to do this as we'll expand on later. What makes this wave different from the prior ones is the AI accelerator. TeamViewer ONE is self-reinforcing in a way superior to any of the prior 3 product improvements. Every AI session makes the platform smarter and every automation makes it stickier. The more customers use it, the harder it becomes to replace. This is a genuine differentiator.

The shift to endpoint based pricing means the revenue opportunity scales with a device footprint, not just with the number of users. This is structurally larger and significantly more durable growth engine. So when we talk about extending our growth runway, this is what we mean. We are not relying on market expansion alone. We have a proven internal engine. One, we have run multiple times before. We are now running it again with a highly differentiated product, a larger addressable market and a data advantage that compounds with every interaction.

Let me now explain the mechanics behind that compounding effect, what we call our flywheel for Autonomous Endpoint Management. What you see on this slide is the core of what makes TeamViewer ONE structurally different from anything a competitor can bring to market. The infinity loop shape is deliberate because it is a self-reinforcing cycle that gets smarter with every single interaction. And it is powered by 2 proprietary data streams that no competitor owns together, expert remote support session knowledge and deep endpoint telemetry from DEX.

On the right-hand side, the loop starts with the remote support session. Our TeamViewer Intelligent Agent called Tia joins the session and helps the IT expert diagnose and fix the issue, often in seconds rather than minutes, and an increasingly agentic way. Once the session ends, AI automatically creates a summary, capturing what happened, the root cause and the resolution. That summary then flows into the left-hand side of the loop. Each session becomes a data point. Patterns emerge across thousands of sessions, which our DEX intelligence translates into proactive recommendations for IT teams.

The next step is automated and autonomous remediation. Instead of fixing the same issue manually every time the system creates an automation that resolves it across the entire endpoint estate. And as it says in the middle, fixed an issue once and it is fixed forever. The more the platform is used, the smarter it gets because every session sharpens Tia's intelligence, which enables continuously more automations across the support operations. The result is a self-reinforcing flywheel. More AI sessions mean better detection, faster resolution and smarter automation, which reduces friction for end users and drives greater adoption and stickiness. This translates directly into measurable productivity gains for our customers.

What makes this generally hard to replicate is the data. We are the only company in this space that owns both data sets natively. The session data from remote support and the telemetry data from the endpoint occurs. We own both at scale across more than 620,000 customers globally, tens of millions of managed devices and billions of connections.

Our flywheel is not even fully in motion yet and already early customer feedback is outstanding as you see on the right side. The full flywheel capabilities are being unlocked this summer, which will be a major milestone for TeamViewer. This is what drives our confidence in our growth story. TeamViewer ONE is the commercial vehicle. The AEM flywheel is the platform pool. And our data advantage compounds with every session, widening the moat and deepening customer stickiness in a way that directly fuels our path to sustainable growth.

Let me zoom into one element of that flywheel, the rapid growth of AI adoption across our product and customers. By the end of April, more than 26,000 customers have already used TeamViewer AI, and cumulatively, we have generated more than 1.3 million AI sessions with over 300,000 added in March alone. These are paying customers making a deliberate choice to use our integrated AI. That level of active adoption is a strong signal that the customers see real value. This growing customer traction underscores the structural data advantage that powers our Autonomous Endpoint Management innovation.

There has been considerable debate in the market about how AI will shape the future of the SaaS industry. For TeamViewer, we have a clear eye view on why we see AI as a structural tailwind organized around 3 dimensions: the market, our moat and our business model.

Let's start with the market. AI does not shrink our opportunity. In fact, all indications point the other way. As IT shifts from reactive to autonomous management, the number of end points need to be actively managed actually grows. AI moves to the edge, Internet of Things penetration accelerates. And every new connected device is a potential TeamViewer endpoint.

Gartner estimates more than 50% of organizations will adopt some form of Autonomous Endpoint Management by 2029. That is the market we are moving into. It is meaningfully larger than the remote support market we are coming from. With our unique AI innovation, we are leapfrogging into that autonomous IT market and its massive opportunity.

On TeamViewer's moat. The reason AI strengthened our position rather than threatening it comes down to data, trust and integration. We operate at the endpoint where the friction occurs and where the remediation happens. This gives us 2 proprietary data streams we described earlier at scale that no competitor can match. We are also deeply embedded in global IT infrastructures across more than 620,000 customers and in mission-critical environments around the globe. We have built trust, reputation and expertise over 20 years as a vendor-agnostic software provider. That entrenchment is a structural advantage. This is then amplified by the AI flywheel effects discussed earlier.

And on the model. Our expansion into AEM is driven by our existing go-to-market approach since we are already selling to the relevant buyers through Tensor and DEX. We are bringing a strong new best-of-suite value proposition, a proven upsell motion. The transition from seat-based to endpoint based pricing is a natural evolution as we sit on the endpoint and do endpoint management. There is substantial upside from this alone in our massive global device footprint.

Zooming out and putting all of this together, the shift towards autonomous IT management validates the importance of our proprietary data advantage. If anything, the pace of AI adoption tells us that there is more potential ahead than we initially anticipated. The early commercial data confirms it. For a company with our data, our endpoint footprint and 20 years of customer trust, AI is not a threat, it is a structural tailwind.

Let me give the floor to our customers because they say better than we can. You will see 3 earlier adopters sharing the real-world impact of our market-leading AI innovation, 25% faster resolution on recurring issues, 25 to 50 hours saved per month, recurring issues identified, countermeasures defined, automations written automatically, instant proof of service at the click of the button. This is what it looks like when AI moves from promise to tangible business impact. Our full AEM capabilities go live this summer and the compounding effect of this data advantage will only accelerate from there.

And with this, I would like to hand it over to Mark to detail how the commercial engine is set up to capture the opportunity in front of us.

Thank you, Oliver. Let me walk you through what the commercial engine looks like on the ground. We came into 2026 with a clear mandate to accelerate global sales and go-to-market execution. I want to share the progress that has been made and the early evidence of our efforts. Let me start with the organization since structure is what makes everything else possible. We took decisive action to level up the organization. We have exceptional new leadership in place with Tim Koubek as President of Americas, and Finn Faldi as our new EVP of Inside Sales, combining deep domain expertise and strong executive presence.

Tim and I worked together previously at LogicMonitor, so I know what he is capable of. He has already hit the ground running. Americas is our second largest region, and he and I are fully aligned on the mission to reignite growth in this exciting market. We both see strong upside as the go-to-market motion matures there.

Finn is a TeamViewer veteran rejoining. He is -- he was the key leader driving the upsell motions discussed earlier and will now drive the same for TeamViewer ONE in global inside sales. He has already had a material impact in the short time he has been onboard.

We have a unified sales in a global organization under my leadership and rolled out a very highly sophisticated sales playbook operating across SMB and Enterprise. Our revenue operating system will take a further leap forward with the rollout of Salesforce, which is in its final stages. This will give us better pipeline visibility and sales discipline to execute at scale. The organization is truly energized by the new momentum around TeamViewer ONE. This was evident at our global sales kickoff in January, where we set the course for this year.

On go-to-market activation, TeamViewer ONE is resonating. The market feedback on the unified value proposition has been very strong. Customers understand the consolidated value proposition and they're responding to it. We're also strategically scaling our marketing presence, deliberately ramping up brand campaigns and events ahead of the AEM general availability this summer. So the commercial activation and the product milestone arrive together. And the channel motion is stepping up, too. We had a fantastic EMEA Partner Summit in March with the Americas to come. The partner network is an important multiplier for us, particularly for managed service providers, and we are investing accordingly.

On deal momentum, we are very confident in our pipeline. The leading indicators are moving in the right direction across both segments. In Enterprise, TeamViewer ONE is already winning strategic large deal flagship customers less than a few months into launch, demonstrating that the value proposition is clearly landing and the sales motion is effective. In SMB, we can see the course correction is stabilizing the base, which is the foundation for new growth momentum on the back of TeamViewer ONE.

TeamViewer ONE ARR more than doubled quarter-over-quarter in Q1. This is the commercial engine turning. We have the organization, motion activation and deal momentum. And with the AEM launch ahead of us and the pipeline building across both segments, we believe we are set up for growth. Q1 shows tangible evidence that our strategic positioning is translating into wins on the ground.

Three flagship deals stand out. First, a German bicycle retailer with more than 40 local shops, they chose TeamViewer ONE to manage internal IT across a distributed retail and workshop network, ensuring frictionless store operations and excellent customer experience, a clear example of TeamViewer ONE resonating with mid-market customers where simplicity and reliability matter most.

Second, a global digital transformation provider with thousands of endpoints. They selected TeamViewer ONE to seamlessly integrate acquired companies into a centralized IT model with real-time automation and response, delivering tangible ROI from day 1. This is exactly the unified proposition we have been building towards with TeamViewer ONE.

And third, a global leader in agricultural machinery with some of the most iconic brands, they have selected TeamViewer to embed Tensor OT directly into their remote portal across an estate of almost 100,000 connected machines. This is a multiyear strategic partnership built on joint engineering going well beyond typical software deployment. They plan to use TeamViewer to deliver a new digital service to dealers and farmers, reduce on-site technician costs and improve uptime in time-sensitive harvest operations. Their CEO described this capability as a "must-win bet." This is the kind of strategic OEM use case where there are very few credible alternatives to Tensor OT in the market.

And looking ahead to Q2, we have already secured a significant contract expansion in one of our flagship DEX accounts. The customer, one of the largest integrated health care systems in the United States with approximately 600,000 endpoints under management is scaling their commitment with us. The expanded contract now exceeds $10 billion in annual recurring revenue, a clear validation of our DEX platform, a mission-critical scale and a strong indicator of how flagship customers deepen their investment once real-time remediation is proven across the fleet. This is an excellent example of how our leading value proposition in digital employee experience and Autonomous Endpoint Management continues to translate into tangible growth. TeamViewer ONE is clearly resonating with our customers.

Finally, just last week, we announced that the Mercedes-AMG PETRONAS Formula 1 team has upgraded from Tensor to TeamViewer ONE. This is a textbook example of the upsell motion playing out at the top of the market, a high-performance organization running thousands of critical endpoints across factory, office and track side with 0 tolerance for downtime. And importantly, under the Formula 1 cost cap, sponsor status does not automatically translate into operational deployment. This is particularly true for the Mercedes sponsor roster. The fact that they actively chose to expand with us is, therefore, a strong validation of the TeamViewer ONE and AEM value proposition at the highest performance tier.

Taken together, customers are choosing TeamViewer because we can deliver outcomes of scale that point solutions cannot. That is the value proposition working, and it gives us real confidence in the pipeline ahead.

With that, I hand over to Michael for the financial overview.

Thank you, Oliver, and Mark, and good morning, everyone. Let's look at our key financials for the first quarter of 2026. As Oliver already mentioned, everything is tracking to plan. The first quarter reflects the phasing we expected. Top line broadly stable alongside strong profitability and normal anticipated cash flow timing effect.

Let me give you a brief overview of our financial performance, starting with the ARR. We delivered EUR 737 million ARR, flat year-over-year in constant currency. As we explained during our Q4 2025 results, Q1 top line growth was impacted by 2 factors: one-off 1E churn and strategic SMB course correction measures. Importantly, one-off 1E churn effects are largely complete and the remaining customer base is stable. Enterprise fundamentals remain strong. Enterprise ARR excluding DEX increased by 18%, demonstrating continued and strong underlying growth.

On the P&L, revenue was EUR 183 million, broadly flat year-over-year in constant currency. This is fully consistent with internal expectations and in line with our 2026 revenue growth guidance. Adjusted EBITDA increased by 2% to EUR 83 million, delivering a strong adjusted EBITDA margin of 45.3%, 2.4 percentage points above Q1 last year. I will explain the cost phasing behind this in a moment. Reported net income and EPS both increased by 15% year-over-year. Adjusted EPS was EUR 0.29 this quarter.

On the balance sheet, net leverage ratio sequentially improved to 2.5x, which demonstrates that we are actively and remain firmly on track for our around 2 to 3x year-end target.

Before I share the details, I want to reiterate that Q1 was going to be a soft start as we said in February this year. The one-off 1E churn effect of EUR 8 million and the headwinds from the SMB course correction measures were known, disclosed and prepared for. What you see in Q1 is, therefore, the phasing we plan for. The numbers are in line with our expectations and behind that phasing, the leading indicators tell us that we are moving in the right direction. The commercial momentum Oliver and Mark walked you through gives us a clear confidence in the ARR growth acceleration that we have committed to for the second half of 2026.

Let me now go through our key financials in more detail on the next slide. Let me start with the P&L. Constant currency revenue was broadly stable and in line with our expectations. Reported revenue was negatively impacted by foreign exchange movements, resulting in a 3.3 percentage point headwind compared to last year, primarily driven by the U.S. dollar. The actual average FX rates in Q1 are provided on Slide 23.

SMB revenue decreased by 1% year-over-year in constant currency to EUR 126 million, reflecting the impact of the SMB strategic measures mentioned earlier. Enterprise revenue was flat year-over-year and reached EUR 57 million. We saw strong underlying growth in TeamViewer excluding DEX which was temporarily offset by one-off 1E churn effect. Gross profit was EUR 168 million with a gross margin of 92%, broadly stable year-over-year and reflecting the high quality of our subscription revenue base. The COGS decreased by 8% year-over-year, reflecting lower variable costs in line with top line development and lower frontline related implementation costs.

Total OpEx decreased by 8% year-over-year to EUR 85 million, demonstrating our disciplined cost management even as we continue to organically invest in growth and innovation. Sales expenses increased 6% year-over-year, driven by investments in the sales organization. This is intentional and ongoing. Marketing costs decreased 28% year-over-year, reflecting deliberate phasing of marketing costs ahead of our major brand and commercial activation, including the Autonomous Endpoint Management innovation launch in Q2. This is not structural, it will normalize.

R&D costs were up 7% year-over-year, reflecting continued investments in the combined product offering, AI capability and a higher number of internal developers. We are investing in our innovation capabilities to fuel our next leg of growth. G&A expenses declined 8% year-over-year due to phasing and continued cost synergy realization. Other expenses amounted to around EUR 900,000, down year-over-year, reflecting lower bad debt charges. Adjusted EBITDA margin of 45.3% is higher than our full year guidance and is a Q1 phasing effect. Our full year guidance of around 43% remains the right reference point.

Net income was up 15% year-over-year. Total interest expenses were EUR 9.5 million in Q1, up EUR 0.8 million year-over-year. As in prior quarters, this was driven by 1E financing. Adjusted EPS was EUR 0.29 this quarter, stable year-over-year.

Then moving on to leverage. Net debt was EUR 870 million at the end of Q1 2026, which is an improvement of EUR 31 million compared to net debt at year end of 2025. Net leverage ratio sequentially improved to 2.5x. As mentioned, we have a clear path to reach our year-end net leverage target of around 2.3x. The details of the free cash flow will follow on the next slide.

As I mentioned earlier, Q1 shows normal anticipated cash flow timing effect. Levered free cash flow conversion in the quarter was 29%, which is unusually low and not representative of the full year trajectory. Let me give you a clear picture of cash flow drivers for this quarter. Pretax cash from operating activities was EUR 55 million, up 18% year-over-year. The step down in growth to levered free cash flow adjusted for 1E acquisition reflects cash flow timing effects of taxes, interest and lease payments, as well as a temporary negative impact from net working capital. We expect these effects to normalize over the course of the year. I would like to reiterate that for full year 2026, we expect levered free cash flow to be between EUR 190 million and EUR 210 million, broadly stable in absolute terms and in cash conversion terms compared to 2025.

With that picture of Q1 in full, let me close with the guidance on the next slide. We delivered stable top line performance in line with our guidance and maintain best-in-class profitability. Our focus remains firmly on driving sustainable profitable growth while advancing our strategic road map. We are reaffirming our full year 2026 guidance. We anticipate in constant currency revenue growth in the range of 0% to 3% versus the pro forma 2025 revenues. ARR growth acceleration in the second half of 2026 is on track. We expect SMB churn to remain elevated in Q2 and then to stabilize in the second half of 2026. SMB headwinds and 1E one-off churn effects are developing as expected, and visibility remains good for the remainder of the year.

At March 31, 2026, spot rates, the expected total FX impact of our guidance is negative 3 percentage points for Q2 2026, and negative 2.5 percentage points for full year 2026. The expected currency impact is shown on Slide 23. We continue to guide for an adjusted EBITDA margin of around 43%. Q1 was higher than that. With the marketing cost normalized during this year, the margin should move towards the full year guidance level.

With that, let me hand back to Oliver to bring together what we have covered today.

Thank you, Michael. 2026 is the year of delivery and Q1 was the first proof point. The 2 effects that moderated our results, the one-off churn in 1E and our SMB course corrections are developing exactly as we said in February. What is new is the commercial momentum. TeamViewer ONE is gaining real traction. Customers are choosing platform consolidation over fragmented point tools and AI adoption is compounding with more than 300,000 session summaries generated in March alone.

The early commercial data follows a pattern that we know very well. Tensor went from initial traction to a core share of Enterprise ARR within 6 quarters, and the leading indicators tell us that we are on the same path.

We are reaffirming our full year guidance across every metric. The building blocks for second half ARR growth accelerations are firmly in place. We have the right strategy, the right priorities and a clear path to unlock the next stage of performance.

And I now look forward to your questions.

[Operator Instructions] And the first question comes from Victor Cheng from Bank of America.

A couple, if I may. Maybe on the recent TeamViewer ONE contracts that you have signed where you move from per seat per endpoint, what are the early signs of pricing uplift that you're seeing? And how should we think about the impact to the LTV of a customer when you make such a move, both currently and in the medium term?

And then secondly, just a clarifying point on the EUR 45,000 daily average billings, how should we think of it in ARR terms?

And then lastly, a question on EBITDA margins. Obviously, you guided 43%. So how do we think about the phasing of EBITDA margins going forward? Is marketing spend going back up starting Q2 already?

Yes. Thank you, Victor. Let me start with the last question on the EBITDA margin phasing throughout the year, and then maybe Mark takes the first and Oliver will take the second on the [ EUR 45,000 ] daily billings to ARR.

On the margin exactly as you thought, so 45% was phasing Q1. You should expect something for Q2 in the vicinity between 42% to 43%, and then it will level out throughout the year. So for the full year, we are bang on with the around 43% guidance.

Maybe Mark, the first one on TeamViewer ONE pricing?

So yes, on the pricing, Victor, thanks for the question. So look, we are seeing some good uplift from existing customers where we might upsell them to TeamViewer ONE. Of course, there's 2 sides to that, right? So it's a way of retaining customers. But also, we are seeing some meaningful uplift. So we're seeing some healthy progress there overall. We didn't disclose those numbers, but we are seeing good progress.

Yes. Maybe on the second question, I mean, I think it's a general topic. The kind of per seat to per endpoint, and then the EUR 45,000 billing. So generally, obviously, we are steering the business for ARR firmly, as you know from all our disclosure. But the TMV ONE upsell is mostly happening in inside sales, and they are looking at the daily transaction volume at the actual invoices. So the invoices for cash that we're sending to customers. And therefore, we chose that billings number as an indicator here just because it really shows the daily traction, and we expect this to grow significantly from here throughout the year, as you can expect.

Typically, what we see is an ARR conversion, billings per ARR conversions between [ 0.7, 2.9, ] Sometimes it's a 1:1 conversion, really depends on the deal. So there is a little bit of a step down typically because there's also a little bit of 2-year deals or so even in inside sales, but generally speaking, quite close to the billings. And again, this is just an indicator.

And then the upsell depends a lot on the number of devices. There is a -- in most situations, there's an in-built meaningful upsell because people have more devices under management and want to move to more devices under management than they were paying in seats for remote control and remote support. So this is almost like a mathematic effect of customer footprint. There's also opposite customers that have a different behavior that has no managed devices and only need to grow from the start, but it typically comes with a nice uplift.

And the next question comes from Alice Jennings from Barclays.

A couple from me as well. So just firstly, on the SMB KPIs, so thinking about the subscriber numbers and then also churn. How much of this is driven by that decision to abandon the free-to-pay campaigns? And then I guess, therefore, what can we think about as being a more normalized level for these KPIs once that effect has come to an end, I think, in Q3?

And then the second question is just on 1E. So I mean the acquisition has been integrated for a little over a year now. So wondering how the cross-selling between is progressing? And I guess, how this compares to internal expectations at the time of the acquisition?

Yes, Alice. Let me start with the second one. The first one, sorry, I didn't hear it correctly, but someone will help me, who takes that one. On the 1E integration, actually indeed fully integrated. I give you also some synergy elements, both on the cost side but also on the top line side. Cost first, we gained de facto EUR 3 million of savings in 2025, and it will ramp to EUR 6 million this year, including the EUR 3 million of last year. So with all of the integration done, number one, on the cost side, especially FTE, G&A area, we gained a lot, but also on consolidating contracts and also in the COGS area, we were able to optimize our costs, which is good and nice and needed.

Moving then to the -- so the top line element, it's a good one. Remember, we told the market that we expect a rough cut EUR 10 million revenue synergy on the top line. And we see this actually tracking and trending nicely. Number one, the full pipe is rough cut in the vicinity of EUR 70 million. So with a conversion ratio of 1/3, something in the vicinity of around EUR 20 million. And that means EUR 20 million ARR then would obviously be bang on kind of on the EUR 10 million revenue synergies. And we mentioned -- as Mark explained that now with one big deal, which we just explained in the [ U.S. ] of this additional upsell of EUR 2 million ARR, this is obviously already fueling this revenue synergy, and there are many more coming and also came some already.

Can maybe just to add one comment. I think the examples I explained, pretty -- most of them are really good evidence of cross-sell working. The strategy here of bringing together the 1E DEX proposition with the TeamViewer remote proposition and TeamViewer ONE, as we've explained it, and the strategic benefit to customers of that infinity loop that Oliver explained in the presentation, that's what's really fueling our cross-sell opportunity, and that's where we're starting to see significant wins and it's where we're seeing real significant growth in our pipeline.

Yes. And on the free-to-pay campaign, I think you asked for what is the normalized motion on the free-to-pay. So all of the, let's call it, the hardcore free-to-pay commercial broker has been stopped, and the normal vicinity and there's some normal movement of free-to-pay, and this should be in the vicinity also around 1 million to 2 million.

Yes, I think the -- just said, I think it's also on the subscriber number, I think, look, whether if you don't do free-to-pay you're missing a few thousand subscribers that you bring in every quarter at the entry level. And that's what we're missing. So obviously, if we see very, very strong usage of free users first, we observe them and then we speak to them, and then we convert them into paying customers. So that's still moving. That's the kind of, I would say, the normal conversion funnel that we obviously operate from marketing to paid conversion. But what we're missing is the inflow of few thousands every quarter, and that's noticeable in the subscriber numbers. So if you would normalize for that. If you go back, when we still have this running, we were keeping the subscriber numbers stable. But then we had elevated churn. So that's what we're correcting now. So that's the order of magnitude to think about.

Next question comes from Ben Castillo-Bernaus from BNP Paribas.

First one, really on TeamViewer ONE Enterprise, the momentum there sounds encouraging. Could you just touch really on what's resonating with customers? Tensor is not new, but adding DEX and then the AI overlay and AEM to come. I think you mentioned some sort of consolidation, customers want cleaner platform. Can you maybe just touch on who you might be replacing there? And then just coming back to the discussion around the price point moving to endpoint pricing, clearly a sizable increase over a typical Tensor [ ELA, ] how are the sales cycles different? And how are you kind of balancing the direct sales versus channel versus MSP? Mark, you mentioned some investment required in the MSP partner network. So what does that look like? And how big can that become in the mix?

Yes. I think these are both for Mark.

Sure. First one, so the value around TeamViewer ONE Enterprise. So basically, as we kind of explained in the presentation, the infinity loop, the ability to utilize the remote control sessions that you are doing on a day-to-day basis across your devices and then turn them into autonomous capabilities that live on the endpoint. This is completely unique in the market. So there's no one else that can provide that kind of solution. And when you take that proposition to the enterprise, it's somewhat of a no-brainer for customers because they're already running a remote control solution, which -- and very often, they're a little bit losing that data that happens. They're not collecting. So leveraging that very rich data that could be taken from those sessions. And of course, we enable them now using AI to sort of leverage that data and more importantly, turn them into autonomous capabilities.

And I doubt there's any CIO on the planet that isn't really focused on taking their IT organization towards autonomous IT. So that's really what's resonating. And in terms of who are we replacing, all the usual suspects. I mean, we come with a joined up proposition, a single platform, single agent, single price point that allows our customers to invest in a platform for Autonomous Endpoint Management. And therefore, we're able to swap out the existing remote control vendor that's there. Same as to on the other side, by the way, is if they are coming from a DEX angle, it's also an opportunity to replace the current DEX vendor.

On pricing and sort of investments around channel, maybe just talk about investments around channel, clearly, yes, that's a big opportunity for us. It's already a significant part of our market. I mean, a large part of our customer base are managed service providers. If you break it down, we have the traditional MSP channel, which is servicing the SMB market where we already have significant traction in customers today. So there's clearly a very big opportunity there with TeamViewer ONE, and that's where we're seeing a lot of our early success with TeamViewer ONE standard and advanced. And then as you move up the ranks into sort of mid-market and enterprise, there's a different breed of MSP right up to global system integrators, and we're addressing all of them as well with dedicated channel and sales teams focusing on those types of partners.

And maybe to add on -- sorry. On the endpoint based pricing and the sales cycle there. The sales cycle is not different, really. I mean the proposition is very strong, as Mark laid out. So it's really is a deliberate move of customers to consolidated platforms and have kind of the joined up offering of the infinity loop, so to say, from us, so the DEX part, the AI part. And the remote part in one package, so to say. That is the decision they're taking, and that is a decision which is not a difficult one, as Mark said, because people want to consolidate and want to simplify.

Then the -- we move with this, you need to have a measure, and the measure in this can only be endpoint because it's outcome-based, so to say, it's endpoint under management. So that doesn't influence the sales cycle. It's more that it influences the rollout cycle sometimes. So customers move on to the new proposition and then you see how they are step-by-step adding endpoints because they might have a certain number of endpoints under management, which they then move to TeamViewer ONE. And then over time, they're expanding it or they still have a vendor existing in the base, as Mark just said. And then when that contract comes to an end, then they're adding end points. So that's more the dynamic at play. It's not so much a sales cycle. It's more a deployment and rollout and then land and expand cycle, which is, I think, the very interesting piece of TeamViewer ONE is that there is much more land and expand opportunity now with the endpoint number growing and proliferating into OT and IoT environment.

And the next question comes from Florian Treisch from Kepler Cheuvreux.

I have a question as well on TeamViewer ONE. You flagged your excitement around the midterm potential of the product or even near-term potential. So can you maybe provide us, let's call it, an at or exit level for the fiscal year, what do you believe might be a good approximation for daily run rate at the end of '26 to really get a feeling about how fast you can ramp up the revenue stream?

Oliver, do you want to take that?

Yes, I can take that. So obviously, as you point out, early innings, I think we've never seen a run rate, daily run rate increase like this in any product that we have been launching. And clearly, we are -- we want to be cautious in what we provide as guidance to the market. But we really want to make TeamViewer ONE a double-digit million contributor as quickly as possible. So with the current run rate, if you do the math on ARR quite soon, this is the case, and we want to grow from here clearly throughout the year.

I would probably look at it like doubling from here on the standard, advance, which is happening in inside sales. So getting to EUR 100,000 ARR a day throughout the year is something which we want to do. And then that doesn't include TeamViewer ONE Enterprise, which only started and it's hard to give a prediction of how many deals we will get there over time. But you can expect a meaningful step up throughout the year.

Yes. And Florian, to add on what Oliver just said on Enterprise, take the one big customer, which we just explained also, which is a reverse move to TeamViewer ONE from DEX to Tensor now. I mean this alone will make the equation explode. So the Enterprise move can be very significant but very early or too early to indicate anything, as Oliver also outlined.

And the next question comes from n Gustav Froberg Berenberg.

Just two on the lower end side of the SMB kind of customer group, if you like. Could you just give a bit more color on what you are rolling out or the initiatives you're putting in place to bump up growth as you progress through 2026? And sort of in line with that question, how do you see competitors and the rest of the market trying to address this segment? And how does your approach differ or compare?

Yes. Maybe I can start or Oliver, you go ahead.

So if I can start like more generally, I think the -- as we've shown that picture of the different segments, I think what is clear is that there is a very, very healthy SMB base, which we are addressing an untapped growth or generate additional growth. And the initiatives on that one are TeamViewer ONE, AI, AI usage, ARR price-ups, so more for more over time when people get to use AI even more. We're focusing on adoption at the moment, but monetization is following suit. So there's a lot going on in this.

If you go at the entry level, speak at the entry level, where the usage from customers is quite confined to remote support, we are working to keep the base as stable as possible. We have reduced kind of strategies, which are kind of upsetting customers more, so like-for-like price increase, as we had mentioned before. But there's not so much upsell motion you can do in this one. So it's all about keeping the base as stable as possible. We don't see a significant change in competitor behavior on this end, quite honestly. And I think I'd say more of the same. But with the negative effects of price ups and the likes washing out throughout the year, we will see improvement towards the second half of the year as well.

Sorry, Michael, go ahead.

So only mini add-on. So Gustav, especially from 2027 onwards when the price ups in the commercial blocker completely washed out also in the lower segment, that should also keep on stabilizing them more and more. But in the end, and you know it and we know it, it's a commoditized business on the very low end and competition is high. And if we would think about lowering prices or so that is -- the back book effect would just be too high. So keep it as much as we can, but it's difficult on the low end to enrich via feature set.

Ladies and gentlemen, this was today's last question. I would now like to turn the conference back over to Oliver Steil for any closing remarks.

Yes. Thank you, operator. Thank you, everybody, for joining. I know it's a busy morning. So thanks for the interest in TeamViewer and the questions, and I hope you have a good day, and talk soon. Thank you. Bye-bye.

Good morning, ladies and gentlemen, and welcome to TeamViewer's Q4 and Full Year '25 Earnings Call. I am Bisera Grubesic, Head of IR. Today, I am joined by our CEO, Oliver Steil; CFO, Michael Wilkens; and CRO, Mark Banfield.

Oliver and Mark will run you through the quarterly business update. Michael will present Q4 and financial -- and full year financials, followed by the full year guidance and midterm targets. The presentation will be concluded by a Q&A session. Same as in the previous quarters, we will present non-IFRS pro forma top line and adjusted EBITDA performance. And also, please note that you can find the important notice and the APM disclosure on Slides 2 and 3.

And I now hand it over to Oliver to kick off.

Thank you, Bisera. Good morning, everyone. Also welcome from my side. Thank you for joining our call today. As the last year was clearly a year of transition after the 1E acquisition, I would like to start differently this time and give you some broader context before we dive into the results.

When we look back at the year 2025, we see a lot of progress and proof that we are on the right track. But of course, there were also some challenges that require our full focus and which we continue to address in 2026 as we are firmly committed to reaccelerate top line growth. 2025 was again marked by macroeconomic difficulties and geopolitical tensions, which affected customer decision-making and made it more challenging for us to execute and operate as initially planned. And as you know, AI was one of the defining forces in 2025.

At TeamViewer, we clearly view AI as a significant opportunity to drive platform growth. We progressed significantly with embedding AI into the core of our product to improve our offering. Our webinar for the Capital Markets last year November made it clear how we and our customers will benefit from AI. We are unique as we are the only company within our industry that can deliver what we do. This is based on our technology and proprietary data and the combination of TeamViewer and 1E product capabilities, which I will elaborate on later.

While our Enterprise business continued to grow, we were disappointed with the SMB business as growth was slowing down. We needed to course-correct our approach regarding SMB customers and decided to suspend all short-term monetization activities like free-to-paid campaigns and pure price up to revitalize the ecosystem of noncommercial users and smaller SMB customers who are very price sensitive. Also, the 1E business performed below our expectations as integration work temporarily slowed momentum and some key talent left. With the new global sales and customer success setup under Mark's leadership, we are now focused on customer retention and rebuilding a strong pipeline, and we are already seeing early strategic wins.

2025 was clearly a pivotal year for TeamViewer. We integrated TeamViewer and 1E capabilities, invested heavily in R&D and sales and go-to-market. We launched several new products during the year. The first one, DEX Essentials, is an easy-to-implement DEX version for smaller IT teams. It was built in record time after the 1E acquisition and represents a stepping stone to our most important new product, TeamViewer ONE, our all-in digital workplace management platform, unifying DEX, AI-based remote support and RMM to create a new differentiated offering for companies of all sizes. We could see that our efforts paid off already in Q4 with a strong traction of TeamViewer ONE, highly strategic customer wins in DEX and Frontline as well as an overall continued strong TeamViewer Enterprise momentum.

Let me now talk you through our full year results. We closed the year with 5% pro forma revenue growth in constant currency year-over-year. ARR grew 2% in constant currency and TeamViewer stand-alone Enterprise business was 19% up in constant currency and therefore, the main growth driver. New ARR from TeamViewer stand-alone even doubled year-over-year. The Enterprise business overall showed strength in Q4 with highly strategic wins in DEX and Frontline. At the same time, we were able to deleverage as expected and improved our net leverage ratio to 2.6x. Our profitability remained high, and we closed 2025 with a pro forma adjusted EBITDA margin slightly above 44%. 2026 will clearly be another transformational year for us. I will elaborate later more on what that means and which priority areas we will be focusing on.

Let's now take a look at the regions and customer categories and how we have developed during the year. Revenue grew in constant currency across all regions in 2025. EMEA was our strongest region, contributing slightly above 50% to our revenue. The region delivered EUR 402 million in revenue, up 6% year-over-year. In the Americas, revenue reached EUR 292 million, up 3% in constant currency despite an ongoing difficult market environment in the U.S. Especially towards the end of Q4, the U.S. team brought in a few very important strategic deals, which I will show in a few minutes. APAC delivered EUR 73 million in revenue, up 4% in constant currency, driven by a good Enterprise performance. We were especially happy about a few DEX, Enterprise deals in the region. This is noteworthy as 1E didn't have any business in APAC, but TeamViewer was able to bring DEX to the region due to our dedicated APAC go-to-market efforts.

Looking at our customer categories, Enterprise continued to demonstrate strength. Revenue as well as ARR grew by 11% year-over-year in constant currency. With this, the Enterprise business now contributes more than 30% to our business. In SMB, revenue grew by 2% in constant currency, while SMB ARR was down minus 1% in constant currency. As already explained, we were not satisfied with the SMB performance in 2025 and already took measures to course correct.

Let us now look at the respective ARR value ranges in Enterprise and SMB. In Enterprise, all value ranges delivered double-digit growth, reflecting the enterprise momentum we saw throughout the year and especially in Q4. Notably, also the highest value range of above EUR 200,000 picked up again with the strategic DEX and Frontline wins in the quarter. In SMB, the highest value range grew by 3% year-over-year. The lower value ranges were down mid-single digits. This reflects successful upselling into richer product packages within SMB on the one hand, but also the price sensitivity of smaller customers that I already talked about. As usual, we saw net upsell from SMB to Enterprise of EUR 12 million reported, which demonstrates the effectiveness of our sales strategy to move customers up to higher value ranges.

Let me now tell you a bit more about some of the Enterprise deals of Q4 that we are particularly excited about. In the fourth quarter, we won a few highly relevant large deals. I would like to highlight 3 of them, all from the U.S. First, we were able to convince a large and well-known U.S. company from the defense sector to introduce our DEX solution and use it across the vast IT landscape. For these customers, the capabilities customers -- the capabilities of our platform for real-time remediation and autonomous endpoint management were the decisive reasons to choose TeamViewer DEX.

This equally applies to the second deal with Thrive, a large U.S.-based managed service provider with a growing presence across the globe. They will integrate our DEX solution into their managed services platform to enable better insights and more automation for their customers. They chose TeamViewer as we are a clear leader in the DEX space and in IT support automation and secondly, because of our ServiceNow integration.

The last example I would like to highlight is the largest frontline deal in our history. It's one of the world's largest consumer food and beverage producers who will deploy our frontline picking solution across more than 350 warehouses, which also offers great potential for the future. We have been working with these customers on this project for quite some time and are very excited that we were able to close the deal now. Frontline is an integral part of our digital workplace platform as it is very much needed to digitalize physical work environments such as production lines or warehouses.

We are a recognized leader in this space and have built a unique and differentiating positioning over the last years with large customers such as DHL, Coca-Cola, Nadro and now this additional win in the U.S. Some of our largest enterprise customers use TeamViewer Frontline to digitalize manual work in industrial settings. All in all, we see that whenever the requirements are complex, when critical processes are affected and real-time operations needed, we are very well positioned as we create very real business value for our customers in these environments.

Let me now explain our strategic priorities for the year 2026 and beyond so that you know what to expect from us. We have a clear plan to make TeamViewer even stronger going forward. In this section, our CRO, Mark will also present a few topics. First, let me take a step back and look at what we are seeing in the market. Quite simply, IT is reaching an inflection point. Over the last decade, companies have layered tool upon tool to solve individual problems. The result is a highly complex and fragmented landscape with overlapping solutions, rising operating costs and frustrated users despite very significant investments.

Too much time and money are being spent simply just keep the operations running and far too little on true innovation and value creation. At the same time, we are witnessing a secular technology shift with AI. Companies clearly recognize the potential of AI to transform IT operations, automate work and meaningfully improve productivity. But fragmented tools, manual processes and reactive operating models make it difficult to deploy AI at scale. And in many cases, AI even adds the complexity instead of reducing it.

Taken together, this IT breaking point and the AI opportunity drives a fundamental market shift. Companies are now demanding simpler, more cost-efficient, AI-powered IT management. They are looking for consolidated platforms that reduce complexity, enable predictive problem solving and support the move towards autonomous operations.

So the obvious next question is, who is best positioned to help customers drive this shift from reactive to predictive IT. Doing this well requires several things to come together at the same time. Seamless connectivity across very heterogeneous environments, a high-performing operational engine, proven automation capabilities, a large customer base and increasingly a unique AI advantage built on access to hard-to-get and high-quality data.

And this is exactly where TeamViewer differentiates. Our core TeamViewer heritage is built on over 20 years of experience in remote support and connectivity at global scale. And with 1E, we added unmatched and proprietary capabilities for real-time remediation and autonomous endpoint management. Together, this gives us unique broad visibility into devices, applications, performance and user experience, the kind of data foundation that AI actually needs to deliver value.

With TeamViewer ONE, we have deliberately unified these capabilities into a single best-of-suite platform, purpose-built to simplify complex IT environments and to drive a shift left towards proactive and predictive operations. It brings together all of TeamViewer's best-of-breed solutions and connects them through a shared data and AI layer. Every AI-powered remote support remediation generates insights that continuously reinforce our DEX-driven self-remediation engine. And that is why we believe TeamViewer is uniquely positioned to shape this market inflection. Our integrated capabilities position us at the very center of the shift towards intelligent consolidated IT operations.

Looking at 2026, we have defined 4 key priorities that we will focus on in the coming months and that form building blocks for our transformation journey. We will elaborate on each of them in more details afterwards. Firstly, it is crucial to revitalize the SMB business as well as the performance of the stand-alone DEX business. Secondly, we will continue to invest organically in our market-leading product offering. Thirdly, we will accelerate global sales and go-to-market execution. And while doing all of this, we remain committed to our deleveraging goal of around 2.3x net leverage at the end of this year.

We have clear actions in place to reignite revenue growth in 2026 and beyond. The first building block is the turnaround of our SMB business and the reacceleration of the 1E performance, meaning DEX for Enterprise. As we have already mentioned end of last year, we have started initiatives to revitalize the ecosystem of noncommercial users, for example, through avoiding aggressive free-to-paid campaign. Price increases will be tied to clear additional value in the product, for example, bundling our AI capabilities or automations into the remote licenses. We appointed Finn Faldi as Executive VP, Global Inside Sales to strengthen the global sales organization.

And on top of that, we have set up sales and customer-facing organizations more efficiently and according to best practices with new sales and AI tech stack to ensure more focus and improved customer retention. This goes together with better onboarding and customer support throughout the entire life cycle to unlock potential and create value. Of course, also TeamViewer ONE will play a key role in retention and upselling strategies and represents a key strategic differentiator against competing RMM products.

For 1E and DEX, we've also identified and implemented measures, in general, an enhanced product focus on the core DEX and automation use cases to release features the customers were waiting for. We enabled our global enterprise sales force to sell DEX, and we have improved relationships with long-standing 1E customers through a comprehensive customer success management framework and a structured customer advisory board program. Again, the TeamViewer ONE platform and our AEM proposition play an important role in this context, and Mark and I will elaborate on this in a few minutes.

Now let's have a look at our ongoing organic product development. As part of these organic investments, I would like to show you again how we position our product offering in the market. All our different solutions are leaders in their respective space, Tensor and Remote in remote access and support, DEX in digital employee experience and Frontline in the connected workforce space. We will continue to improve them as stand-alone products. Additionally, through the 1E acquisition, we were able to successfully position us at the forefront of the emerging digital workplace and autonomous endpoint management categories, which we will naturally extend into frontline workplaces.

With the unique combination of TeamViewer and 1E technology within the TeamViewer ONE platform, we are able to deliver an industry-leading one-stop shop for IT operations and AEM, covering the full spectrum from proactive auto remediation capabilities to remote expert support. Customers across the globe understand and embrace the value of DEX and the strategic road map towards more automation and ultimately autonomous endpoint management. All of this is powered by AI as this is horizontally embedded across the entire product portfolio and at the core of our offering. We will continue to invest organically in AI and develop more agents that can leverage the unique proprietary data we have access to.

Our AI products saw good and quick adoption since the introduction of the growing suite of AI-powered features in summer 2025 as well as the announcement of TeamViewer's new intelligent agent, Tia at Microsoft Ignite in November. At the beginning of February, more than 13,000 customers had already opted in for the AI Session Insights feature and had used it to summarize more than 600,000 TeamViewer sessions.

To illustrate our unique position in the autonomous endpoint management space, I would like to quickly explain again how the complementary capabilities of DEX and remote access and support work together and strengthen each other. In an ideal scenario, a new and until now unsolved digital friction occurs on one of the devices inside a company's IT landscape. A human expert will now take care and use remote support capabilities to look into the issue. Obviously, the expert will appreciate AI supporting him or her on root cause analysis and remediation of the issue. The session will be captured and automatically summarized by AI to make it available as a foundation for the future and increase intelligence across support operations.

At the same time, our DEX technology is constantly analyzing device and system data in real time. This is matched against the DEX insights library with preconfigured automation for frequent issues. Closing the loop, we are able to build new automations out of the previously generated session summaries resulting from expert support. And this loop is constantly increasing the amount of automations across the support operations. Fixing an issue once means it is then fixed forever and can be executed autonomously at scale.

With this, I'd like to hand over to Mark, who will talk about TeamViewer ONE as well as our go-to-market strategy.

Thanks, Oliver, and a warm welcome from me, too. TeamViewer ONE, as we said 2 weeks ago at our global sales kickoff in Munich is clearly our #1. It's a unified digital workplace platform to enable autonomous IT and endpoint management. It combines all of our leading solutions and capabilities, remote access and support, DEX, RMM, AI at the core, and we are the only vendor who can unify this range of capabilities in a single platform. We will offer it to all our existing as well as all of our new customers across all geographies, all industries and across all customer categories as it is equally compelling for both SMBs, Enterprises as well as managed service providers.

It adds enormous value to our customers as it unifies all IT operations under a single platform. This makes it our #1 go-to product, go-to-market product for this year and beyond. Of course, we will continue to sell our stand-alone solutions, but wherever there is a case of TeamViewer ONE, we will go for that as it offers endpoint pricing and therefore, financial upside, but also higher stickiness as we will become much more relevant to our customers.

We have the right ingredients, the right products, the right proprietary data, the right customer base and an enabled global sales force to sell this leading solution and win in this space. Only recently in December, we released a major product update to TeamViewer ONE with a very compelling design and user experience. This gave another push to marketing and sales to focus on TeamViewer ONE, and we already see the first results.

Now let me wrap up this section by talking about our go-to-market strategy. Our first focus area is to retain and grow customers. We need to set strong focus on churn prevention and work across sales and all customer-facing departments in lockstep. Of course, Enterprise customers need to be treated very differently than SMB ones. But overall, we need to reduce churn and instead drive demonstrable outcomes for our customers, satisfying them and using the momentum for upsell and cross-selling as we migrate them to TeamViewer.

As I already outlined on the previous page, TeamViewer ONE is the leading go-to-market product for our sales force. If there is no direct entry point to TeamViewer ONE, we will go with the most suitable stand-alone solution and follow up with a very clear land and expand strategy. For all scenarios, we have developed a very comprehensive global sales playbook, and we have trained our entire sales force on this at the recent global sales kickoff. The third set of measures that will move the needle this year is ruthless prioritization of leading KPIs and a rigorous data-driven approach to decision-making. We will continue tracking and managing our pipeline as well as sales productivity and focus on operational excellence everywhere. This is not rocket science, but gives us a clear path to a strong global market -- global go-to-market execution.

With that, I'd like to hand over to Michael for the financial section.

Thank you, Oliver and Mark, and good morning, everyone, from my side. Let's look at TeamViewer full year 2025 results on the next slide, please. In 2025, TeamViewer delivered a solid financial performance with revenue reaching approximately EUR 768 million, reflecting a 5% year-over-year increase in constant currency. This growth was broad-based with all regions contributing. Revenue landed within our guided range, aligned with the FX assumptions communicated at Q3 2025.

The annual recurring revenue grew by 2% year-over-year in constant currency to EUR 760 million, meeting the updated guidance range also issued in October. Profitability further strengthened in 2025. Our pro forma adjusted EBITDA rose by 8% year-over-year to around EUR 340 million. We achieved again an industry-leading adjusted EBITDA margin of 44.3%, representing a 2 percentage point improvement versus 2024. Adjusted basic EPS also increased by a strong 17% year-over-year. We also continued to deleverage as planned. The pro forma net leverage ratio improved to 2.6x, down from 2.8x in Q3, fully in line with our targeted trajectory.

Now let's look at the details of our Q4 2025 results. Pro forma revenue in Q4 increased by 2% year-over-year in constant currency, reaching approximately EUR 195 million. This performance reflects the continued transformation in the SMB segment and the expected softer revenue contribution from 1E. TeamViewer stand-alone delivered a strong quarter with revenue of EUR 179 million, up 3% year-over-year in constant currency. And the ARR grew by 2% year-over-year in constant currency to EUR 760 million. Profitability remained strong in Q4 with an adjusted EBITDA margin of 45%, underscoring the strength of our business model.

Let us continue with our Enterprise business on Slide 22, please. Enterprise continued to deliver strong momentum, reinforcing the resilience of TeamViewer's core business. Enterprise ARR grew by 11% year-over-year in constant currency, reaching EUR 241 million now. As I mentioned earlier, TeamViewer stand-alone Enterprise had an excellent quarter with ARR increasing 90% year-over-year in constant currency. Growth was again broad-based across all regions, supported by a particularly resilient EMEA performance.

As Oliver highlighted, the positive trajectory was bolstered by several notable new logo wins in Q4, including the largest TeamViewer frontline deal ever signed, contributing a mid-single-digit million ARR in the quarter. As a result, the new ARR doubled year-over-year in Q4 2025. 1E also showed encouraging progress. Q4 2025 marked a turnaround quarter with sequential ARR growth returning. This momentum was driven by 2 highly strategic DEX, Enterprise wins, together representing a total contract value of approximately EUR 10 million or around EUR 3 million in ARR. Our Enterprise customer base continued to expand, reaching 5,262 customers by the end of the fourth quarter.

The pro forma Enterprise ASP increased to around EUR 46,000 per customer, reflecting continued success in delivering higher-value solutions across a growing customer set. The Enterprise net retention rate was 96% in Q4 on a constant currency basis. Adjusted for the upsell from SMB customers during the period, the Enterprise NRR reached 99%. This NRR trend preliminarily reflects a subdued ARR expansion among existing customers, lower SMB to Enterprise upsell and the stand-alone performance of 1E, combined with a higher share of new ARR in the quarter that is, of course, not captured in the NRR calculation. We have implemented measures designed to drive Enterprise NRR above the 100% mark in the midterm.

Let us now move to our SMB business on Slide 23. Pro forma SMB revenue reached EUR 131 million in Q4, increasing 1% year-over-year in constant currency. The SMB ARR declined by 1% year-over-year to EUR 519 million. This development was fully in line with internal expectations and reflects 2 key dynamics: continued successful upsell of SMB customers into Enterprise and the deliberate SMB cost correction measures, which we introduced in the third quarter. These measures include discontinuing short-term monetization initiatives and price increases. As outlined in Q3, this strategy is focused on reinvigorating product usage across both the free user ecosystem and the broader SMB base.

Encouragingly, the free user ecosystem is already demonstrating early signs of stabilization. The actions taken in Q3 2025 have a negative impact on ARR and the related KPIs shown on this slide. While SMB customer churn increased, value churn remained broadly stable quarter-over-quarter. As we work to revitalize the SMB business and to establish the foundation for sustainable growth, we expect SMB KPIs to remain soft through the first half of 2026. End of 2025, we served approximately 631,000 SMB customers. Our SMB ASP grew by 2% also year-over-year to reach EUR 822, underscoring the resilience of our monetization model.

Let us now turn to our cost base on the next slide. For the full year 2025, our pro forma adjusted EBITDA margin was very strong at 44.3%, representing a 2 percentage point improvement compared to 2024. This performance reflects our disciplined cost management even as we continue to invest in growth and innovation across our product portfolio. Overall, pro forma recurring costs remained broadly stable throughout the year. Cost of goods sold increased by 5% year-over-year, driven by our ongoing customer platform investments and by development support for our frontline projects.

Sales expenses rose by 8% year-over-year as we expanded our sales force and strengthened our enterprise technology stack to advance our transformation into a fully data-driven sales organization. Marketing costs decreased by 15% year-over-year, primarily due to optimized sponsorship spend. At the same time, we continue to invest in targeted branding initiatives and in the launch of new products. In total, marketing costs represented 13% of revenue, down from 16% in 2024. And as a result, overall sales and marketing efficiency improved meaningfully.

In 2026, we will maintain a clear focus on driving further efficiency gains, sharpening our go-to-market execution and scaling data-driven demand generation. R&D expenses increased by 7% year-over-year, reflecting significant investments in product innovation, including our TeamViewer AI offering and the TeamViewer ONE platform. These investments form the foundation of our AEM strategy and position us strongly for future growth. G&A expenses developed in line with revenue, demonstrating consistent cost discipline. Other expenses amounted to around EUR 7 million for the year.

Let us now turn to net income and EPS development on the next slide, please. Pro forma adjusted earnings per share was EUR 1.23 in 2025, a strong increase of 17% year-over-year. Our strong profitability and our continued focus on optimizing operating expenses supported this performance. This was partially offset by higher total interest expenses, which amounts to EUR 40 million in 2025, up EUR 22 million year-over-year, which is primarily driven by the financing of the 1E transaction. The FX result reflects negative translation effects related to an intercompany loan as required under IFRS.

With this, let's move on to cash flow on Slide 26. In '25, adjusted levered free cash flow amounted to EUR 208 million after adjusting for nonrecurring items. This represents a cash conversion of 61% and demonstrates the continued strength of our underlying business model. Cash flow for the year was influenced by several factors, including moderate top line growth, FX headwinds and higher interest payments related to the 1E acquisition. In addition, cash flow reflected the acquisition-related payments for 1E and the settlement of a legal dispute in the first quarter of 2025. These effects were partly offset by lower tax payments resulting from changes in our tax scheme, which had a positive impact on cash flow in 2025. Looking ahead, we expect cash taxes to increase from 2026 onwards and return to normalized levels despite some positive one-off support because of the 1E deal structure.

With that, let me now provide a brief update on our financing on Slide 27. We continued to deleverage in line with our commitments following the 1E acquisition. Our pro forma net leverage ratio improved further to 2.6x, demonstrating our clear focus on balance sheet strength and disciplined capital allocation management. At year-end, cash and cash equivalents amounted to approximately EUR 42 million and net debt was EUR 901 million. As mentioned in Q3, we also successfully refinanced EUR 30 million of the EUR 175 million bridge loan through a private placement, further strengthening our financial position.

Looking ahead to 2026, reducing leverage remains our top financial priority. We reiterate our commitment to continued deleveraging and expect to reach a net leverage ratio of around 2 to 3x by year-end in 2026, subject, of course, to FX movements. At the same time, we will continue to invest organically in the areas that matter most, particularly R&D. These investments are essential to drive sustainable long-term growth and continued innovation across our product portfolio and our AEM platform. With that, let me now move on to our full year 2026 guidance and to our midterm targets on the next slide.

Turning to our outlook for 2026. We expect another year of disciplined execution and continued operational progress. Our focus remains firmly on driving sustainable profitable growth while advancing our strategic road map. For the full year 2026, we anticipate a constant currency revenue growth in the range of 0% to 3% in full alignment with the lower end of our preliminary outlook for 2026, which we provided already back in October 2025. The guidance reflects the cost correction SMB as well as the seasonal ramp of Enterprise later in the year. Please also note that Q1 will be a soft start into 2026 as we face a few large but fully anticipated one-off churn effects in 1E. These effects are unavoidable, known and confined to Q1.

We also expect to deliver another year of strong profitability. We guide our adjusted EBITDA margin again at industry-leading levels of around 43%. This is supported by continued cost discipline, operational efficiencies and the benefits of our increasingly integrated product and platform strategy. At the same time, we will continue to invest in the areas that drive long-term value creation, particularly R&D to capitalize on the significant opportunities in front of us.

In addition, we remain fully committed to further deleveraging. As mentioned, we expect to reach a net leverage ratio of around 2.3x by year-end 2026, assuming FX remains stable. Strengthening our balance sheet is one of our core priorities, and we will continue to manage capital allocation with discipline. Finally, for our midterm outlook, we expect a reacceleration of growth into the mid- to high single-digit percentage range. This outlook reflects the inherent strength of our business model, supported by our focus on revenue expansion, consistently strong margins and robust cash flow generation.

With that, let me walk you through the details of our '26 guidance and the midterm targets on the next slide. We guide revenue in constant currency, but reported figures will naturally move with FX. To keep the transparency high, we will show the expected quarterly FX impact on revenue growth and separately highlight the FX effect from releasing older deferred revenue to avoid systematic over or underestimation of these impacts. This helps to distinguish true operating performance from currency noise. Based on the 31st of December 2025 spot rates, the FX reduces Q1 2026 growth by 3.1 percentage points and full year 2026 by 2.8 percentage points with U.S. dollar as our largest exposure.

Before we hand over back to the operator for Q&A, let me briefly sum up full year '25 and our outlook. 2025 was clearly a challenging year. Yet despite this backdrop, we delivered solid revenue growth and outstanding profitability. At the same time, we made substantial operational progress that strengthens our foundation for sustainable long-term growth. Looking ahead, 2026 will be another transitional year, but with our guidance and the measures already implemented, I'm very confident in our trajectory. We have the right priorities, the right focus and a clear path to unlock the next stage of our performance.

With this, I would now like to hand the call back to the operator to open the Q&A.

[Operator Instructions] The first question comes from the line of George Webb from Morgan Stanley.

I want to kick off with a couple of financial questions. I guess the first one, as we think to that FY '26 guidance range on revenues for 0% to 3% in constant currencies compared to that kind of 2% exit ARR growth level, it's quite a wide range on where ARR growth could exit in FY '26. So perhaps could you add a bit more color on how you think about that shape of growth in 2026? You've mentioned, Michael, kind of expect that softer Q1 on the 1E churn factors. If you could also kind of just highlight maybe the size of that 1Q headwind, that would be helpful.

And then secondly, around levered free cash flow, you've kind of flagged the EUR 181 million you delivered in FY '25 overall pretty healthy EBITDA development will be quite muted year-over-year in '26. You kind of flagged that EUR 12 million one-off headwind you still had in '25. Are there any kind of other swing factors for free cash flow we should think about in 2026 or your ability to grow that EUR 181 million year-over-year?

Yes. First one on ARR, you're spot on. So the 1E part is in the vicinity of EUR 8 million of churn, more or less the same like in 2024 in Q1, always a tough quarter. But what we need to keep in mind, last year, we had the positive swing against this 1E churn in the SMB space of TeamViewer with price ups and commercial blocker, and this is de facto gone this year as we have the tougher comp. So this is why especially the ARR in Q1 and maybe partially in Q2 will be a little bit muted.

But the important part is that ARR by year-end will be significantly higher than last year. So we will grow from there. That's the name of the game. The problem then starts, of course, with the revenue, which is obviously lagging, and this is also why we took the 0% to 3% guidance, which is fully in line with what we did in the earlier outlook. So that was number one.

On the cash flow, indeed, a couple of swing factors. First, we are always a little bit prudent in the context also from the EBITDA guidance, you see the around 43%, which is more or less the same as last year. But with the top line range of revenue, then you have de facto the outcome on the EBITDA, which is one very decisive factor. And then there are 2 others. Interest should improve a little bit year-over-year in '26 vis-a-vis '25, rough cut EUR 5 million or so.

And we expect a little bit of a positive impact on cash taxes based on the structure of the 1E deal, rough cut EUR 10 million, but that will be de facto balanced with the normal uptick of the normal cash taxes, which is actually a good one to have. So all in all, in the vicinity, cash flow, let's say, again, EUR 190 million to EUR 210 million. So broadly stable in absolute and also in cash conversion terms.

The next question comes from the line of Victor Cheng from Bank of America.

Maybe to start, can you talk a bit about the DEX market? Obviously, there are a lot of industry reports out there showing kind of good growth. But what are you seeing with competitors? Are they maybe slowing down a bit in growth as well? What are you seeing more broadly in that field?

And then 2 other quick ones. On the medium-term outlook, you said maintaining the current margins. I suppose that's referring to the 43% for '26. And then lastly, maybe any updates on the metrics for some of the newly launched products like DEX Essentials and Tia? Any updates on kind of usage and momentum there, please?

Yes, Victor, let me take your second one first. You're spot on. It's in context of the 43% out of -- for '26, which we then also confirm for the outer years.

Mark, do you want to take the DEX market?

Sure. Okay, sure. Look, I think overall, the DEX market continues to show strong tailwinds. I mean it's a growing market. It's -- there's clearly -- there is a movement within the IT market to invest in DEX as the kind of the next sort of platform for end-user computing. Some of our challenges last year, I think we've talked about quite a lot as they were specific challenges around the integration of the businesses.

Q4 showed some real highlights actually. I mean the deals were mentioned there by Oliver, a couple of significant wins. These were head-to-head competitive wins and there were many more than that as well. So we're starting to see nice wins, larger wins. We're also starting to see TeamViewer customers start to adopt DEX, which we said at the time of the transaction would take some time to build that pipeline, but we started to see those deals convert in Q4. So I think we feel much better going into 2026. But yes, overall, I think the DEX market is continuing to accelerate.

Yes. Maybe I'll take the last question. Metric on new products, obviously important and something we track. Important to say, Victor, that we launched these products all around last year, and it takes time to kind of mobilize -- enable and mobilize the sales force to really take this on and move this forward. And especially on TeamViewer ONE, this is a very new platform approach as we had laid out. So we had to connect different capabilities from 1E and TeamViewer into one place, make the user flow easy, easy onboarding and easy to add, manage devices and the like. So that took a while.

That release was only done beginning of December. And what was really good to see that then in December, in the year-end business, we really saw a good number of TeamViewer ONE deals, although we hadn't enabled the whole organization. So that was very positive. Then obviously, year-end cleaning the pipeline and then moving into new year. And then we had the sales kickoff just 10 days ago. Super high excitement across the sales organization inside sales and enterprise. And why is that? TeamViewer ONE is selling and has been selling and is increasing to sale day by day. So there's transactions every day.

The proposition lands with customers. Our sellers really feel this is a very competitive proposition, a clear step change compared to what we offered earlier in the marketplace, so confined remote support and some additions with partner products. But now it's really our own product bundle, and we see increase in billings and ARR additions really on a weekly basis. So very exciting. We will come with more color around it as we go through the year for sure. But this is starting to be meaningful on a daily basis really, especially on the TeamViewer ONE side.

On AI, focus is on adoption still. As I mentioned, well above 600,000 sessions now have been done, have been used. There's customers opting into this. We will bundle it even more into the product. TeamViewer ONE will be a key catalyst for that because it is a built-in functionality in this product. We will also think about pricing and monetizing throughout the year. So we continue to see very good progression there in line with what we had anticipated when we did the AI webinar.

We now have a question from the line of Alice Jennings from Barclays.

So my first one is just there's a lot of AI-driven headlines in the news at the moment where we're seeing like really rapid innovation and lots of new products in the market. You've mentioned kind of already how you see the competitive environment for DEX specifically. But just wondering more generally, how do you see the competitive environment for endpoint management evolving? And are you seeing kind of any change in customer behavior as a result of these headlines?

And then my second question is just on the medium-term guidance. Do -- can you tell us anything about your expectations for when you expect to be in the mid- to high single-digit range? Is this something that's realistic for 2027? Or is this a little bit further down the line?

Yes. Let me start with question number one. AI drives the headlines, 100%. I think there's a lot of discussion around how customers' buying behavior will change. Obviously, we see that. As I said already in my presentation, customers want automation. They want to use AI. They want autonomous IT. They want simplicity. They want platform approach. They know that more is possible using AI, and that's why it's so important to build AI into the product range.

This is not a stand-alone on the side AI gimmick, if I may say, but it's really a functionality and a capability across the product range. So taking what we see in sessions, learning from it, synthesizing it and making it available in the DEX automation library. That is the key thing which we're building and what customers really expect.

We also believe that what you need is access to data, proprietary data, for sure, and we have that. Out of our 630,000 customers, you might call it an unfair advantage because we come there with this massive customer base and the millions of sessions that we're doing every month that we can tap into and leverage to build inside. So that's really important.

We also believe what gets lost in the discussion about AI and application software risks is clearly that it depends a lot on the layer you are in. We are an infrastructure piece. We are connecting very heterogeneous environments. We're doing end-to-end solutions at very high security, and this is not easily replicated and being built by AI code in a few days or so. So this is a complex thing.

It's touching the heart of operations. It's at the core of our customer, highly security relevant. And that's where we built our experience over the years, and that's why we are so strongly positioned in this because customers take very deliberate choices and what they try and what they not try and how they want to move forward in the use of AI. So we see that as clearly a tailwind for our product and our positioning in the market. Midterm outlook?

Yes. Midterm outlook, let's remind ourselves the distinction between the ARR and the revenues and the revenues, the lagging KPIs. So on ARR, we expect that already to uptick in '27 after '26, which is the first uptake important. But on the revenue, because it's lagging, it's more or less an inch-by-inch kind of thing. So it's mid-single digit and then rather in the outer years, '29, higher single digit. This is how we need to think about it.

The next question comes from the line of Ben Castillo-Bernaus from BNP Paribas.

Firstly, just on the SMB part of the business. I mean could you help us with what might be a realistic outcome here for 2026 if we're exiting at slightly negative ARR growth. We're digesting no price increases, commercial blocker. How can you help us think about that? How do we square that decision to, I guess, stop those campaigns, again, no pricing, we're seeing churn increasing. But presumably, we need to return to some growth here. And if we look at that sort of midterm outlook, in your internal assumptions, what does that SMB business need to do to help underwrite that?

Yes. I can start also with the ingredients. So first, full year versus full year, so minus 1% last year, '25, we expect the same vicinity in the end of '26, so around a minus 1 maybe. So kind of stabilizing in the full year. And indeed, especially Q1 and Q2 will be a little bit under pressure because of the tough comp. And the numbers that we need to climb is EUR 20 million versus last year, price ups and commercial blocker. And this needs a little bit of time.

Oliver laid that out, 2nd of December, a strong launch of TeamViewer ONE, and this is firing on all cylinders, basic, advanced and enterprise, but especially basic and advanced are very important ingredients. And whenever we would do price ups, then clearly in a more-for-more logic. So where the customer actually also really gains new product features, new services and then gets the offer of a price up where they can also say, no, thank you. So that's one part of the equation, very important.

And the second part of the equation in order to stabilize it throughout the second half of the year is, of course, the expected positive churn impact. Remember, we were faced with churn in the SMB business. And with the stop of the, let's call it, rather unfriendly price ups in commercial blocker, this negative churn effect should wash out over time and customers will come back and will stay, but this is rather expected for the second half of the year.

So this gives a little bit of an outlook for '26. You asked also how we think further. So if we stabilize, of course, with the very strong injection of the TeamViewer ONE platform autonomous endpoint management across all business lines, we expect then from '27 onwards, obviously also a slight uptick in growth back in the SMB business. That's more or less the function.

Yes. Maybe just to add, if you look at the TeamViewer ONE, it's a very central proposition for SMBs. It's the best of suite offering management platform, as Mark laid out and described. Now when we sell into SMBs, what we see at the moment is with kind of TeamViewer ONE advanced, this is a few thousand euro most of the time as a ticket size. Ultimately, this will be very important to drive SMB growth potentially in a way.

But quite often, we also see ticket sizes than EUR 14,000, EUR 15,000, EUR 16,000. So by doing so, the valuable SMB customers move into enterprise in just one go. And that will also determine how much of the growth from TeamViewer ONE will actually land in SMB or in Enterprise. But obviously, we will be very explicit about how this is working because it's fundamentally obviously also a very good thing to move customers into the double-digit or lower teens euro range and have endpoint-based pricing, which is much stickier, much stickier and has more growth potential. So that's what in play here, and that will impact the SMB outcome as well.

That's very helpful. Can I just squeeze in a follow-up just around the Enterprise business. You mentioned that the net retention rate, you hope that gets back above 100% over the midterm. I just wondered what's holding that back from happening sort of towards the latter part of 2026, given the new TeamViewer ONE solutions, the 1E integration, the upsell capabilities? What sort of time frame would you consider that to be?

Yes. Clearly, cautiousness. So this is -- this was our learning of 2025, to be a little bit more caution. And then, of course, the tougher situation in Q1 or the muted or softer Q1 index, we need to work against that.

The next question comes from the line of Deepshikha Agarwal from Goldman Sachs.

This one is more on SMB as in terms of just trying to understand like we have -- you have put out the strategy around like, again, normalizing the price increases, et cetera. So how should we be thinking about how SMB is going to track over the course of FY '26? And more -- like how will that be contributing to that growth improving to mid- to high single digits? So that will be the first one.

And second one is more on the cash conversion. Now for this year, it's indicated to be roughly similar to what we saw in FY '25. Once the growth sort of starts picking up better and the margin sort of again, normalizes and it stays at a certain level, how should we be thinking about a more normalized level of cash conversion?

Yes. Let me take the last one first. Cash flow, indeed, stable in relative and absolute terms in '26 over '25. And you should de facto think in the same vicinity also in the outer years, maybe slightly growing the cash conversion from the 60% ranges into 63% or so. But let's talk about that when we get there, once we get there.

On the SMB question, I'm not sure whether I just explained that, but let me do that again and then you come with a follow-up question. So Q1, Q2, SMB should be rather more muted, so i.e., negative based on all of the comp and what we explained from -- also from the churn effects. And from that moment onwards, SMB should clearly accelerate and go really back into sequential growth in Q3 and Q4, which then would mean that we are back into kind of stable [ month ] around minus 1% for the full year of '26. So that's the name of the game.

With all what is kicking in, with all what we have had innovation features, platform, autonomous endpoint, topics at play, also what Oliver mentioned, from '27 onwards, SMB should be rather in the vicinity of 0, which would be then a slight growth, maybe even 1%. But it's also -- it will be determined also by the higher lower 10,000 range, whether this will be then an accelerated growth into the Enterprise space or whether we will see this in SMB. It's a little bit too early to quote victory yet.

[Operator Instructions] We now have a question from the line of Gustav Froberg from Berenberg.

Just 2, please. First, around the SMB segment as well, just talking a little bit about churn. I was hoping you could give us a little bit more color as to kind of the continued uptick there, what you think is driving it and how you view competition on the SMB side and maybe also some of the action points that you are implementing to stem that churn?

And then second is just on the pipeline for 1E. I'm just wondering if you could talk us through the pipeline there as we head into next year, churn aside and maybe what needs to happen to get customers across the line and signing those deals earlier in the year as opposed to later in the year?

Yes. Let me start. So SMB segment churn, as you see, I mean value churn is broadly stable. I mean we've always communicated logo churn, and we're losing customers at the lower end, price-sensitive market in our what we call remote access product, the basic license. If there's not a lot of usage on the product and the user is clearly not a professional user that uses the full reach of our product, it's hard to keep those customers. We are not reducing prices there because we believe they have the premium product, and it's all about usage and adoption.

But if the customer is a very occasional user, then it's tough. So that's where we see the logo churn. But we do see a good upsell motion. We have lower churn in the higher segments, and we're improving the product significantly in these higher segments, in these professional segments. And therefore, we do see reasonably and better churn development.

Now what we have been suffering from is clearly in this segment, high usage, loyal users, that has been the segment where we had these like-for-like price increases. They didn't land well with customers, and this is washing itself out. So that will be a positive churn impact, plus positive churn impact through new products, cross-sell, stickier products and also the ability to expand our footprint across more managed devices. So whenever we go from seat-based to device-based or endpoint based, there is more upsell potential as you had historically also seen in the Tensor product range. So these are the forces at work there, and that's why we see an improvement in churn coming through driven by, I would say, the bulk of the loyal heavy use customers that get new propositions.

On pipeline 1E, Mark, maybe?

Yes, absolutely. Yes. I mean generally, pretty strong pipeline going into 2026. We focused heavily last year on enabling all of the sales organization. And it takes some time to enable sellers to become competent on positioning and selling tech, both to new logos as well as going back to existing customers. But we have a good pipeline going into this year.

In terms of acceleration, how do we land those deals earlier, a couple of things to mention there. First off, just discipline around sales process, sales methodology. We use a tried and tested sales methodology called MEDDIC. We put this into a very prescriptive sales playbook, which I mentioned in the script there, which was -- which is really designed to enable all sellers to use a very consistent sales methodology, sales process, clear stages, clear gates that we move through and really educating sellers on how to drive value at every stage of the sales process. And so that will help us drive deals quicker. It will help us drive deals to closure quicker.

The other thing to mention is we've talked a lot about TeamViewer ONE and quite rightly so because it's absolutely strategically critical for us this year. And we see really great early success with this product set. And that's a product that spans both SMB and Enterprise, very specific sort of a go-to-market approach for both those segments. One of the things that's absolutely critical is if you take the Enterprise space, where traditionally, we go up against head-to-head with traditional DEX players, we are, of course, taking a very differentiated approach now to DEX because we are combining it with TeamViewer Remote.

And as Oliver outlined, with the ability to take these Session Insights and turn them into autonomous capabilities at the edge is totally unique. And it's not something anyone else is able to bring to market. And so far, we've seen tremendous traction from going out and talking to customers about it, so much so that it has accelerated already sales cycles and helps us win really. I mean we mentioned some significant wins in Q4. And I think we'll continue to see that trend because it's really setting us apart from the traditional DEX competition and given us a lot of differentiation.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Oliver Steil for any closing remarks.

Yes. Thank you, operator. Yes, before we close, maybe a few general comments, important to note. In 2026, I think as you've heard, we have a very clear plan. Yes, last year, we had PMI glitches for sure. Now the organization is very energized. I think everybody internally gets it that we have a very highly innovative product platform, which is also resonating very well with our customers, but also industry analysts.

I think we have a very good news flow around what we've put together now, and that's obviously very encouraging. We believe that we are exceptionally well positioned to shape this emerging, call it, super cycle of autonomous IT management. On the back of the capabilities we have, unique capabilities, proprietary data sources and really the massive customer footprint and endpoint footprint and remote session footprint. So we are excited.

Clearly, 2026 will be a year of a very focused execution to capture this value, which is ahead of us. But we feel good about it because we do see, as Mark just said, also very encouraging traction already across the business and across the segments. So we look forward to continue speaking to you to update you on the progress. And as always, thank you very much for joining us today. Thank you for your support and partnership.

Thank you, operator. Good morning, ladies and gentlemen, and welcome to TeamViewer's Q3 '25 Earnings Call. I am Bisera Grubesic, Head of Investor Relations here at TeamViewer. And today, I am joined by our CEO, Oliver Steil; CFO, Michael Wilkens; and CRO, Mark Banfield. We rescheduled this call to today from the originally planned date of 4 November in the financial calendar following the publication of our ad hoc statement yesterday evening. We wanted to provide you with a comprehensive overview of our Q3 performance and the updated full year guidance today. Today, Oliver and Mark will run you through the quarterly business update, and Michael will present the financials. The presentation will be concluded by a Q&A session. Same as in previous quarters, we will present non-IFRS pro forma top line and adjusted EBITDA performance. And also, please note, you can find the important notice and the APM disclosure on Slides 2 and 3. With this, I hand it over to Oliver to kick off our presentation.

Thank you, Bisera. Good morning, everyone. Also welcome from my side. Thank you for joining our call today, which we had to organize in short notice, as Bisera just mentioned. Apologies for that short notice. But based on our Q3 performance and following a comprehensive review of the remaining deal pipeline for the fourth quarter and 2025, we decided to update the full year 2025 pro forma guidance yesterday evening and then obviously worked hard to be able to provide you today with the complete picture of where we are. But let me begin with an overview of the last quarter.

Closed the quarter with 4% revenue growth as well as 4% ARR growth year-over-year in constant currency. Pro forma ARR reached EUR 757 million now at the end of the quarter. Our Enterprise business remains the key growth driver with TeamViewer stand-alone enterprise ARR up 18% year-over-year in constant currency. Our profitability continued to be high in Q3 with pro forma adjusted EBITDA margin at 46% and adjusted EPS up 15% year-over-year. This demonstrates the resilience of our operating model and our ability to deliver strong margins through all macroeconomic cycles.

Additionally, we improved our pro forma net leverage ratio to 2.8x, in line with our deleveraging target. We also made further progress with product innovations and integration, particularly in the emerging category of autonomous endpoint management or AEM, which is the main building block for the future digital workplace offering. We also progressed with DEX Essentials, which is our SMB DEX offering as well as with TeamViewer One, which is the digital workplace platform.

Moreover, we are well on track regarding our Agentic AI road map. I will share a few more details on this topic later in the presentation. But obviously, also need to address one topic where we clearly performed below our expectations, the 1E stand-alone business. 1E's ARR decreased by 2% year-over-year in constant currency, and Mark will provide more details on this later. But I can already say that we have immediately taken first actions. We will continue to implement further measures, and we are confident that these actions will strengthen this part of the business going forward.

Ultimately, the slow pipeline conversions of 1E stand-alone business negatively impacts our top line guidance for this fiscal year. Michael will explain the guidance update in the financial part of the presentation in detail then. And as usual, let's now take a look at the regions and customer categories and how they developed in the quarter. So revenue grew in constant currency across all regions in Q3, demonstrating the resilience and adaptability of our business. EMEA was once again our strongest region, delivering EUR 101.5 million in revenue, which is up 6% year-over-year in constant currency.

This very solid performance reflects the continuous robust enterprise momentum, and it underlines the relevance of our offering in this market. EMEA remains a reliable growth engine for TeamViewer, supported by strong demand for our high-value solutions. In the Americas, revenue came in at EUR 72.1 million, which is up 2% in constant currency despite a generally subdued market environment in the U.S. This impacted deal volumes and slowed decision-making, particularly regarding the 1E business and in the public sector, where the recent government shutdown has been overshadowing customer conversations for quite some time now after DOGE in the second quarter. This was the next topic.

APAC delivered EUR 18.3 million in revenue, which is up 3% in constant currency, also driven by solid enterprise performance. We also secured promising DEX pilot wins in markets like South Korea, which is really reinforcing our strategic directions in the region because it's clearly a new topic in the regions where we can position ourselves very nicely. If you look at our customer categories, Enterprise continued to demonstrate strength. Revenue grew by 8% year-over-year in constant currency to now EUR 57.9 million and enterprise ARR increased by 12%, reaching EUR 230.5 million in constant currency. And as I already said, this performance was driven more by TeamViewer stand-alone enterprise, which grew ARR by 18% year-over-year in constant currency.

This growth was then partially offset by the already mentioned disappointing performance from the 1E business. If we turn to SMB, revenue grew by 3% in constant currency, reaching EUR 134.1 million, while ARR remained broadly flat at EUR 526.3 million. This reflects the course correction regarding our free user ecosystem and our SMB subscribers. To reduce churn and encourage product usage, for example, also AI, we started to abandon all short-term monetization measures like free-to-paid and price up campaigns in the third quarter and we will continue with this approach in Q4 and beyond.

As a consequence, short-term billings are negatively impacted and ARR growth is stabilizing around 0% constant currency. And of course, after significant upsells from the highest value segments into enterprise, as always. I mean, we take the highest value customers and move them up into the center product range. And what you see on SMB is the net effect after these migrations. Let's now look at the ARR value ranges in enterprise and SMB, where you can see some of the underlying dynamics.

So all value ranges delivered good growth in enterprise, underlying the healthy demand for our solutions across a wide range of customer profiles. The EUR 100,000 to EUR 200,000 range showed strongest momentum with 30% growth and even the largest value range of above EUR 200,000 grew by 4% year-over-year despite the weak performance from 1E because 1E with its generally much bigger ticket sizes is clearly affecting that value segment of the stack and therefore, with the most negative impact in this segment.

If we look at SMB, the new customer inflow was more muted. As I said, some strategic decisions we did on free-to-paid monetization, for example. And hence, the ARR declined slightly in the lower value ranges. However, highest SMB value range of EUR 1,500 to below EUR 10,000 still grew by 5% year-over-year, reflecting the successful upselling into these higher product packages. So from the middle bucket into the higher bucket and then also of the higher bucket into enterprise, as you know.

This is further supported by a continued net upsell from SMB to enterprise, which was EUR 15.6 million this time, which I think demonstrates the effectiveness of this strategy of moving customers up the chain. We continue -- let me quickly explain where we stand in the post-merger integration process with 1E. Obviously, a lot is progressing as planned and as expected. I already mentioned our product launches. We had DEX Essentials and TeamViewer One as our new digital workplace platform to the market -- presented to the market.

Mark will talk in a bit about our go-to-market approach around this, where we also clearly needed to adjust and harmonize our approach as we had lost some momentum in the transition in the original sales motion of 1E, which is a very strong and dedicated enterprise motion, which we want to roll over across the company. We are making good progress from our perspective with the processes and infrastructure harmonization. For example, all former 1E colleagues are fully integrated into our organization and application landscape, and we're also progressing well with the role of Salesforce as our new joint CRM system. 1E was on Salesforce before, and we're going to roll this out across the whole company, which will also bring even more structure and rigor and processes in the enterprise motion.

Unfortunately, we had a few former 1E people that left the company. This is natural, obviously, in an M&A process, but it was slightly more than expected, and that slowed down the progress, especially on the sales side a little bit. And with this, I'd like to hand over to Mark to explain what happened to the 1E business and how we are going to move this forward or turn this around. Mark?

Thank you, Oliver. Good morning, everyone. As Oliver already said, the standalone business for 1E was not good in the third quarter. We -- it was significantly below expectations compared to the pre-acquisition growth trajectory which I was proud of as 1E's CEO last year. Unfortunately, we lost a few key customers in Q3, and we were not successfully converting the pipeline and bringing in new DEX enterprise deals.

We have to admit that the strong focus on the post-merger integration and the launch of the new joint product combined with the departure of some 1E employees impacted 1E's original sales motion, product prioritization and customer relationships.

Moreover, the muted macroeconomic environment in Europe and the ongoing macro challenges in the U.S. also impacted 1E sales by slower customer decision-making and reduced deal volumes. The U.S. was traditionally 1E's strongest market, we're focused on public sector, as you know. It's obvious that discussions about the current government shutdown have been impacting buying behavior in the U.S. way before the shutdown started.

The good thing is we clearly identified these weaknesses and took immediate action. For example, I'm excited to have taken over leadership for all global sales teams and channels. And I'm currently in the process of harmonizing and unifying our go-to-market approach across all regions and product divisions to be able to scale. We have now enabled more than 200 sellers to sell the entire product portfolio, which is a massive potential for us.

At the same time, Oliver has taken over responsibility for all marketing functions to support sales and go to market globally. Additionally, our new Chief Customer Officer, Debbie Lillitos, is building us a -- building up a global customer success and support organization with the clear goal to improve customer experience satisfaction and loyalty.

In the next weeks and months, we will jointly focus on retaining the existing 1E customers as well as converting pipeline for Q4 and, of course, building new pipeline for next year and beyond. Of course, we will continue with our successful activity to cross-sell DEX essentials into the CMB or SMB customer base as well as develop TeamViewer ONE as the one-stop shop digital workplace platform.

It's obviously very disappointing that the 1E business delivered in the first quarter, but this doesn't diminish the strategic value of combining TeamViewer and 1E technology to build something new and market-leading to set us up for long-term sustainable growth.

I'm proud of what we've accomplished since the acquisition. We've made significant progress integrating DEX technology into the TeamViewer portfolio and platform. The introduction of DEX capabilities to our existing customer base have delivered promising results. Within 9 months, TeamViewer has doubled the number of customers using DEX solutions. Today, customers are using DEX essentials of more than 100,000 endpoints.

In short, we positioned the company to deliver meaningful customer benefits and succeed long term in the ever-changing market environment. In my new role as Chief Revenue Officer, I'm committed to driving pipeline and conversion for Q4 and beyond. Back to you, Oliver.

Thank you, Mark. And I'd like to say that we are really very happy to have Mark and his experience in our Management Board and really to see -- your commitment and his commitment for the joint company. And I think it's moving very well ahead on the harmonization on the go-to-market side. Very important topic besides DEX and DEX Essentials. Of course, we were also working on our AI capabilities, clearly, very important proposition. We've successfully bundled them into what we call the TeamViewer Intelligence suite and embedded AI at the core of our digital workplace offering. We have around 9,000 customers that have already opted into these new features as of now. So it's an opt-in, customers allowing us to inspect the data within sessions.

So 9,000 opt-ins, which is a very meaningful number. And in September, last month of Q3, we had around 80,000 AI-generated session summaries that have been created by the TeamViewer Intelligence users. Basically, they use them to optimize their IT service desk task with automated documentation. Early days, but this is very promising, significant number. And I think it's a promising sign for our future success in Agentic operations, and it's growing from here.

Based on the large customer base and user base, the data that we can derive from our solutions and integrations and millions of conducted remote support sessions, we have access to a unique and unmatched data pool and are really very well positioned to leverage this and create an intelligence layer that generates business value for our customers like faster problem resolution, less downtime, higher productivity of the service team.

So clearly, a stepping stone towards automation and autonomous endpoint management in the Agentic world, and that's why we're pushing it so decisively. With session insights, analytics and Copilot, which we already introduced into the market, we are driving this forward, and we're working on launching more Agentic offerings around this platform soon. To round up my presentation, I would like to show you a visualization of how we see our product offering positioned in the market, so-called [ house ].

I would like to underline again the strategic value of the 1E acquisition as it enabled us to successfully position us at the forefront of the emerging so-called digital workplace and autonomous endpoint management categories at the site of our leading frontline offering for the connected workforce.

Through the unique combination of TeamViewer and 1E technology within the TeamViewer One platform, we were able to create an industry-leading one-stop shop for IT operations and autonomous endpoint management, which covers the full spectrum from proactive auto remediation capabilities, the old tax positioning to the remote expert support, which is the TeamViewer side. And I think it's fair to say that customers across the globe do understand and embrace the value of DEX or AEM or automation and really buy into the strategic road map towards more automation and ultimately autonomous endpoint management. All of this is powered by AI, as I said before, as this is horizontally embedded across the entire portfolio and at the core of our offering. And with this, I hand it over to Michael for the financial update.

Thank you, Oliver, and good morning, everyone. Let's now turn to our key financials for the third quarter of 2025. We go to the next slide, please. In Q3, TeamViewer delivered revenue of around EUR 192 million, up 4% year-over-year in constant currency, and all regions delivered again, pro forma revenue growth in constant currency. Our profitability remains strong. Pro forma adjusted EBITDA increased to nearly EUR 88 million, resulting in a margin of 46%. Pro forma adjusted EPS was up 15% year-over-year compared to TeamViewer stand-alone in the prior year, reaching EUR 0.34 for the quarter. And pro forma net leverage ratio further improved to 2.8x, down from 2.9x in Q2 2025 and fully in line with our deleveraging targets.

Now let's take a closer look at the details of our Q3 results. Next slide, please. Pro forma revenue in Q3 grew by 4% year-over-year in constant currency to around EUR 192 million. TeamViewer stand-alone delivered revenue of EUR 177 million in constant currency and grew 6% year-over-year. This was supported by strong enterprise momentum in EMEA and in APAC. 1E stand-alone pro forma revenue was EUR 50 million in pro forma revenue, reflecting an 8% decrease year-over-year in constant currency. This decline was primarily driven by transformation-related headwinds and persistent macroeconomic challenges in the U.S. The ARR grew by 4% year-over-year in constant currency and reached EUR 757 million.

As Oliver explained, enterprise ARR grew by a double-digit percentage year-over-year, driven by the continued strength of the TeamViewer Enterprise business. This growth was partially offset by weak performance from 1E. Sequentially, the ARR was broadly flat, primarily due to the challenging U.S. market negative FX impact. Importantly, our profitability remained strong with an adjusted EBITDA margin of 46%. Let's continue with our Enterprise business on Slide 16, please.

Enterprise continued its high-single-digit growth path in revenue and double-digit ARR, highlighting the underlying strength of TeamViewer's core business. Enterprise ARR grew by 12% year-over-year in constant currency, reaching over EUR 230 million by the end of the quarter. This performance was primarily driven by the EMEA and APAC regions, both of which demonstrated robust enterprise momentum with growth exceeding 20% year-over-year. This was driven by the continued strong performance of TeamViewer Enterprise on a stand-alone basis.

As mentioned earlier, 1E stand-alone performance was impacted by transformation-related headwinds and ongoing macroeconomic pressures, leading to notably weaker results in the U.S. market. On the right side of the slide, you can see that the number of enterprise customers continued to grow both sequentially and year-over-year, reaching 5,216 at the end of the third quarter. Pro forma enterprise ASP remained stable at EUR 44,000 per customer. Enterprise net retention rate was 97% in Q3 on a constant currency basis. Adjusted for upsell from SMB customers during the period, the enterprise NRR reached 102% in constant currency. However, it's worth noting that the weak contribution from 1E slightly dampened the overall sequential trend.

Let's now move on to our SMB business on Slide 17. SMB ARR was EUR 526 million, flat year-over-year in constant currency. This reflects TeamViewer's strategic decision to pause all short-term monetization initiatives. This approach is aimed at revitalizing product usage across the free user ecosystem and the broader SMB customer base. However, in the short term, this impacts ARR and the other related KPIs on this slide. We deliberately halted all short-term monetization measures to reduce churn going forward and to encourage deeper engagement while strengthening the long-term value of our SMB offering.

Pro forma SMB revenue reached EUR 134 million for the quarter, up 3% year-over-year in constant currency. The number of SMB customers was 640,000 at the end of the quarter. Our SMB ASP was up 3% year-over-year and reached EUR 822. Let us now take a look at our cost base on the next slide. Pro forma adjusted EBITDA margin was strong at 46% in the quarter and benefited from cost optimization. Cost of goods sold remained broadly stable year-over-year. Sales expenses increased by 5% year-over-year, primarily driven by investment in enterprise technology stack to drive transformation into a data-driven sales organization.

Marketing costs increased by 3% year-over-year, aligned with planned phasing from the previous quarter and also reflects investments in branding and in the launch of TeamViewer ONE and AI-related products. R&D costs were flat year-over-year and represented 11% of revenue. G&A expenses were 40% higher year-over-year, mainly due to phasing and regulatory-related costs. Other expenses amounted to EUR 1.7 million. The EUR 700,000 increase in other expenses is mainly driven by bad debt increase, which is mostly phasing related.

Let us move on to net income and EPS development on Page 19. Pro forma adjusted earnings per share was EUR 0.34 in Q3, which is an increase of 15% year-over-year compared to the prior year. The main driver behind the increase was our robust profitability and our continued focus on optimizing operating expenses supported overall performance. Total interest expenses for the quarter amounted to EUR 10.4 million, which is an increase of EUR 6.1 million year-over-year. This was driven by the financing of the 1E transaction.

FX result reflects negative translation effects related to an intercompany loan as required under IFRS. Compared to the prior year, income taxes were lower in Q3 2025, reflecting a catch-up effect from the German tax rate decrease. With this, let's move on to cash flows on Slide 20.

Adjusted for nonrecurring items related to the 1E acquisition, the levered free cash flow amounted to EUR 21 million in Q3. This translated into a cash conversion of 24% for the quarter and 49% year-to-date. Other factors influencing cash flow in Q3 included higher working capital, driven by seasonal patterns at 1E, higher operating costs and increased interest payments related to the 1E acquisition. This was partially offset by lower tax payments, which mainly result from changes in our tax scheme and phasing effects. For the full year, we continue to anticipate a cash conversion rate of around 60%, which includes FX headwinds in the cash flow.

I will now give you a short update to our financing on Slide 21. We continue to deleverage in line with our target following the 1E acquisition. Our pro forma leverage ratio improved further to 2.8x, down from 2.9x in Q2. Cash and cash equivalents amounted to around EUR 28 million at the end of the quarter. Net financial liabilities totaled EUR 970 million at the quarter end. We successfully refinanced EUR 30 million of the EUR 175 million bridge loan through a private placement. This was structured as a bilateral agreement with a bank already engaged in one of our promissory notes. Private placements offer us a flexible alternative to traditional bank loans and help diversify our funding sources.

Despite ongoing macro challenges, we remain firmly committed to disciplined capital allocation. Combined with our strong cash profile and solid cash conversion, this positions us well to achieve our leverage target of around 2.6x by year-end of 2025 and below 2x by the end of 2026. Let us continue with our financial guidance on the next slide. Based on the Q3 results and following a comprehensive analysis of the Q4 2025 pipeline, we have decided to update our full year 2025 pro forma guidance.

Slower-than-expected conversion of the pipeline into ARR, which subsequently delays the conversion of ARR into revenue contributed to the revision of the full year 2025 pro forma ARR and revenue guidance. At the same time, our adjusted EBITDA margin guidance has been raised, driven by rigorous cost management. The table on this slide outlines the changes with previous guidance on the left and updated guidance on the right. Under guided FX rates of 4 main categories, including the U.S. -- euro-dollar exchange rate of EUR 1.05, we now expect a total ARR to range between EUR 780 million and EUR 800 million.

Despite this ARR shortfall, our full year revenue guidance is expected to remain within the original full year 2025 guidance between EUR 778 million and EUR 797 million, albeit at the low end. Our adjusted EBITDA margin guidance has been raised to approximately 44%, driven by the rigorous cost management. Let me explain the currency impact for the ARR and revenue guidance changes on the next slide. Let's start with the update to our ARR guidance on the left. As we saw on the previous slide that the ARR guidance for 2025 has been revised downward by EUR 35 million to EUR 40 million due to operational impact, which is mainly 1E related and partially due to our deliberate decision to rebuild the SMB ecosystem.

Oliver and Mark discussed in detail the 1E performance and the actions we have taken to return the 1E business to growth. In addition, updated FX assumptions for our 4 main currencies result in around EUR 20 million FX headwind in the ARR. For revenue, updated FX assumptions led to around EUR 12 million FX headwinds, as you can see on the right-hand side. Let me now briefly discuss our preliminary view on the full year revenue impact in 2026. Management remains highly committed to accelerating ARR growth in 2026 and beyond.

The reduced full year 2025 ARR expectations have, however, a negative impact on the 2026 revenue. This slide presents our preliminary view for the full year 2026 revenue. Under the guided FX rates, we now expect a revenue growth of approximately 2% to 6% year-over-year, corresponding to EUR 790 million to EUR 825 million. In addition, our updated FX assumptions for our 4 main currencies based on full year 2025 expectations result in around EUR 25 million FX headwind, as shown on the right. Please note, we will provide official full year 2026 guidance and the further outlook for 2027 to 2029, including currency updates with the publication of our Q4 and full year 2025 results. With this, I would like to hand back to the operator to open the Q&A.

[Operator Instructions] And we have the first question coming from the line of George Webb from Morgan Stanley.

I've got a few questions, please, and maybe I'll keep them to the core business. I want to ask you -- not sure, I was going to 1E first. If we talk about the reasons why 1E saw weakness in Q3. I guess you gave a range of potential reasons, macro impacting deal closures, some sales employees leaving, several churned customers. On the customer churn side, what information have you collected around why perhaps 1E lost those customers, that'd be interesting to know.

Secondly, on the SMB side of the business, you flagged that kind of change in strategy around free-to-pay monetization to aim to reduce the churn. That churn ticked up slightly in Q3. Why do you felt the need to make that pivot there at this stage? Is anything in that SMB market changing?

And maybe one for you, Michael, on free cash flow generation for the year. I think the prior messaging was around 70% conversion before 1E's one-offs. To me, that starts a little bit tougher after that Q3 free cash flow number. Was that -- was there anything in there we should be aware of? And I guess, when you think about the full year free cash flow, could you provide any updated view that would be helpful.

Yes. Maybe I can actually start with the last one, George. Fully right. Q3 is, by the way, was more or less expected. That is a normal seasonal effect that is mainly due to the seasonality of the 1E business. So that's more or less not a surprise. However, you are spot on. Originally, beginning of the year, we expect a rough cut cash conversion of around 70%. But with this situation now, we think we will still deliver a very strong but still muted 60% cash conversion, which is the result when you put a relation out of a cash number ARR, which is the basis for the change and the still very strong EBITDA, which you see in the margin. That's the reason.

Mark, do you want to cover the 1E reason for churn and what's going on there?

Yes, absolutely. Yes. Look, if you look at it, there's basically sort of 3 or 4 sort of fairly large churn items and the rest are fairly small. Not to sort of name them and go through one by one by detail, but the sort of trends are -- one was really around a partnership type of arrangement where various reasons with the acquisition, it's just -- it was unlikely we would continue with that. So that's one explanation. As you know, we're -- our federal government business is pretty significant, and there was some compression there with the sort of DOGE effects earlier this year had some compression impact on that. And then there's like, I think, one example where we've had an issue in some delivery of the product and some challenges integrating. So there's good reasons for it. There's not a sort of systemic problem there. It's more a couple of sort of like high-value items that impacted us.

Yes. And then George, on -- if we come to SMB strategy change, market change, I mean, picture, I would see is -- what we're seeing is, I mean, we have been seeing slight increase on churn quarter-by-quarter, so to say. And I think we discussed multiple times that we're going against it and try to have better onboarding for customers, which we have customer health checks implemented to understand the sentiment of our customers when they come, when they join, when they activate throughout the life cycle, but then also when it gets closer to the renewal date. So this is in place. And one of the effects we were seeing by looking at this health analysis and the feedback we were getting more consistently now is that we have a slight deviation compared to the past with our price value positioning.

So customers have been quite vocal about the repeated like-for-like price increases upon renewal and frankly, didn't like it. It's not a market change in that sense. Certainly, as we know, entry level, more price competitive, slight price pressure at the level below EUR 500 compared to the upper part of the segment. So that has always been the same, so to say. So I wouldn't say the market has changed, but we have changed over the last years, quarters in how we treat our customers. And I think we came to the conclusion by looking at the health checks that we need to correct this.

So we need to put customer friendliness and happiness front and center again. And that does mean that we need to suspend some of these price increases. Now we had now 3 years of price increase rounds. So I think it's probably more natural than not to suspend this and focus on customer health more. So that's one element where we needed to correct. The other element is, as you know, historically, we have a vibrant free user ecosystem. We have cut down on the free -- we had cut down -- cut off free users some years ago by starting in some markets where we felt monetization of these users in the long run is not helpful. That will not work.

That was clearly something which made sense to have kind of proper usage on the platform and avoid misuse and scamming. But I think we have gone -- or I think we have gone too far in strict monetization too early when users come to the platform. That does impact virality, and it does impact the development of the free user ecosystem. And there's always a part of the free user ecosystem serving as a funnel for usage for paid customers, for paid subscribers and for the proliferation of the product into companies and thereby bringing us new business leads. So that's an important dynamic, which obviously we know of that's nothing new. But from our analysis, we have been too tight on monetization and thereby, we have dampened the virality effect, which is an important thing.

So that's also something which we're correcting. And the third element is we've always positioned additional products to the SMB customer base, so i.e., cross-sell with endpoint protection, backup, remote monitoring and the likes. This needs much stronger focus, and we're implementing much more of this and have implemented over the last quarter and 2 quarters almost because now we have many more cross-sell products where we have, as Mark discussed, the DEX Essentials product for SMB. We have the TeamViewer ONE proposition early, but obviously something we want to position. We have the AI product. So there's much more to cross-sell and that requires additional focus.

So our SMB strategy going forward and the go-to-market initiatives there is really strengthen free user ecosystem again, avoid like-for-like price increases, rather sell richer products and position this new cross-sell product. And that is a shift in focus, which is needed and which we have started to implement. Obviously, it will take some time, and there is a short-term negative effect on billings, which Michael pointed out. But even with this, we were able to keep the SMB ARR flat.

The next question comes from the line from Victor Cheng from Bank of America.

A couple of questions from my side. I guess, first on margins. Obviously, you're not guiding on '26 now. But I think previously, you've talked about like aspirations for '27 and '28 margins. Should we -- given the margin progression already this year, should we expect that to continue into '26? Or do you need more reinvestments on a lot of the kind of products that you're building out?

And then second question is on the maybe focusing on the new products like DEX Essentials, TeamViewer intelligence. And the customers, you mentioned, I believe a lot of them will likely be on a free trial of 30 days. So how has they responded after the trial? And how have you -- have you baked in any of these upside on the guidance for Q4?

And then maybe last question, maybe a bigger picture, stepping back and thinking about the impact of AI as well. Are you seeing maybe less demand and use case for remote support because maybe AI is helping a lot of users self-helping themselves? And a lot of these smaller businesses might not necessarily be taking on the DEX Essentials and TeamViewer intelligence yet? And how might you be addressing that?

Yes. Thanks, Victor. Let me take your first question on the margin. Maybe the most important message upfront, the future outlook to 2028, slow margin improvement to 44% and 45% is in full swing and full impact. That's very important for us. And there's no change, and we clearly see this. With the updated or raise of the margin for 2025 to 44%, we should not continue from here or believe that we are already there because 2026 is number one, cost of the slower revenue growth, which we explained, there's obviously a little bit of margin pressure, but even more important, as you rightfully say, we may also need a little bit of funds, which are very important to invest into the expected and clear growth pattern from 2027 onwards. So we should not continue for 2026, but for the outer years, fully in swing 44%, 45%.

Then maybe to the next question. So the second question about DEX Essentials, TeamViewer Intelligence, TeamViewer ONE, all these new products what we're seeing. It's not only free trials. As you point out, yes, we have -- if you go to the website, there is business trials. And there is good conversion from the trials. So this is obviously self- set up or self-serving of customers. And we do see good conversion there, varying by the product, but that works.

What is more important though on DEX Essentials, TeamViewer ONE is using our inside salesforce. I mean, very strong inside sales footprint globally, as you know. And DEX Essentials and also TeamViewer ONE needs a little bit of handholding because it's a shift of customers, many customers, to move from unmanaged devices, so ad hoc connections to devices to a managed device fleet, which makes it much stickier for us, but also for them. If you think about the service provider serving its customers, -- if you -- if that service provider can convince their customers, his customers to move devices under constant management, that stabilized revenue streams makes it more sticky and also more interesting for our customers or the service provider.

And that's why we handhold there with our inside sales to help them manage devices -- move devices to the management base. And then we changed the pricing structure, which is an endpoint-based pricing and the likes and the like. So that's early days. We only launched these products recently. But as Mark pointed out, we have been able to win a good number of new logos already on DEX Essentials. It's smaller ticket, clearly. It's made for SMB, but we see the inflow coming. TeamViewer ONE very early. So this is in restricted access trial and testing also trying the pricing. And TeamViewer Intelligence, Session Insights, as I mentioned, 80,000 sessions. Every customer has a -- every licensed customer has a free session volume. And then when that customer has used up the volume, then there's a pricing mechanism and we see the customers -- first customers converting.

So it's in the range towards between EUR 0.5 million and EUR 1 million on any of these products. So starting to be visible. But obviously, in the large SMB ARR base, it will take a while until this contributes meaningful growth. Therefore, we haven't baked any upside from these products into this full year guidance. And we have a very good visibility on how this SMB base is moving currently. We've been cautious in the outlook for this year and we really see this as an early phase and land grab driving market penetration with these new products.

And then that links to the -- into the third question, what is AI doing to us? Clearly, everybody speaks about AI. We have a good first proposition with Session Insights, which we're using to improve the product proposition. As I said, every license has a free volume. Customers need to opt in and then they can use the Session Insights in every license. So that's happening. Are we seeing compression, less remote support needs from AI because of self-service users? Not really yet. I think there's still a significant difference between what you can fix yourself when you are an educated IT user, which I know you are, and many of us are.

But the overall situation is still that service providers are growing and having more devices to manage and more complex application landscape. So there will be a shift coming more and more over time. There will be more automation coming and there will ultimately also be autonomous endpoint management coming. That's why we believe the acquisition of 1E is so strategic to us, and that's why it's so strategic to put these propositions together into a platform proposition for digital workplace management and TeamViewer ONE. So more relevant than ever. I think, if anything, also coming back from Dreamforce conference last week, there's so much talk and chatter about AI that what it does maybe is a little -- introducing a little bit of hesitation also on the enterprise side because people really assess and evaluate the different solutions out there at this point in time.

The next question comes from the line of Alice Jennings from Barclays.

I've just got a couple. So firstly, on the weakness in 1E's ARR growth, would you be able to break that down into churn versus new customers and maybe quantify those elements for us? And then the second question is just on the churn for 1E. Do you expect any additional headwinds from churn in the fourth quarter? And when can we expect 1E to return to ARR growth?

Mark, do you want to take those?

Sure. Yes. Not to go into immense detail on the numbers, but it's sort of twofold, Alice. One on the churn side, yes, as I mentioned, there were some churn events that impacted us, but also it's coupled with like weaker bookings than we would have expected. We have a very good pipeline. Some of that pipeline that we would have expected to close through the year has been -- it hasn't gone away, but it's been slowed down. And there's a couple of sort of things that have impacted us, as I've sort of mentioned, we did lose quite some important members of the 1E team. It's been disruptive as we've integrated the companies very quickly. So that's caused some disruption to the sort of normal cadence and flow of how we run the business.

The benefit, of course, is that this huge focus on integrating 1E into TeamViewer and then enabling all of the TeamViewer go-to-market to be accomplished to be able to go out and sell decks and sell this automation story was key. That was the major strategic reason for the acquisition, as Oliver mentioned. And we have worked really hard on sort of really enabling the entire organization.

So we definitely believe we'll see a return to growth in Q4 on the DEX side as we start to see some of that pipeline that has been elongated start to close. And as we start to see some of the early signs of those cross-sell opportunities subsequent as well. Other churn items coming up. We obviously monitor very, very carefully every single customer, re-interaction. Nothing substantial in Q4 on the DEX side, really focused on deal execution really now in Q4 just to get back to some growth on the pure DEX side.

The next question comes from Ben Castillo-Bernaus from Exane BNP Paribas.

A couple from me really on the 1E business, please. Just trying to assess with regards to the customer churn, how much is just single customer concentration risk versus a broader trend? Is this a trend you just saw in Q3? Did that start sooner? Why did it accelerate so much in Q3? And then I guess, following on from Alice's question, but if you look at your customer base here, we're approaching the year-end, the important enterprise renewal cycle. What are you assuming for 1E's retention rates into Q4? Should we be thinking that as stabilizing from here or further downside to come? And then again, sorry to labor the point here, but on the employee departures at 1E, could you maybe give us a sense of were these important employees sales focused or product focused? And when you look at your sales force today, how much of that is kind of new bodies in there versus the existing sales force you had 12 months ago?

Yes. Maybe I start first and then Mark, please chime in. So I think 1E customer concentration. So yes, as you know, the 300 enterprise customers. So I think clearly, single customer events do make a difference. I wouldn't say from what we see, this is a broad trend across the customer base, as Mark has already pointed out. I mean there was a larger deal here, which started as a partnership deal, which we then converted into a customer relationship, but then sell strategically doesn't make much sense. Another big deal that had the downsell, which we were discussing in Q2 already. A few customers, a couple of customers not happy with the road map development because of the kind of shifted focus to integration and new product development.

So in hindsight, it's probably a little bit too much overexcitement maybe on resource allocation to the new offerings versus the old road map delivery. I think that's fair to say. And that has then also led to customers walking and then some price pressure overall or lack of upside. So not a major trend, but yes, here and there, a customer, also not an acceleration in any way in Q3. I think it's more the opposite that in a quarter like Q3, you obviously normally would see more deal inflow, which then compensates for the churn. And therefore, you would normally see the nose lifting in performance.

That didn't come on the new side, on the deal conversion because we had lots of slip deals, and that then creates this overall more negative picture than it is in Q2 and Q1. And that hence also the reason why we said, okay, what is the outlook for the year. And so therefore, that's the dynamic there. That leads to your second question, what are the assumptions on 1E retention. No major change go forward. So when we look at the remainder of the year, obviously, we assume, again, to my point, new deal conversion. There is pipeline deals, good pipeline deals and we would want to convert a few nice ones of them towards year-end, which we always said.

But there is no significant change on the churn side. As Mark pointed out, is relatively calm now towards year-end. We know the deals one by one. We're very close to the deals. And I don't think we have any visibility of any major deal not renewing at this point in time. So I think that the assumption towards year-end until year-end, I think it's pretty deal-by-deal discussion.

Organization, who did we lose? A few senior sellers, especially the senior seller leaving the Americas, there was a loss. The senior seller leading the lever in Europe is with us and is fully integrated into the sales organization now. We have enabled the TeamViewer sellers to position the product, which is starting to work. We have a very significant pipeline and POV starting, as Mark said. So they are not totally new untrained. They have been out there in the market positioning, and it's great to see the pipeline build, especially in EMEA, but also already first POV started in Asia. So that's going in the right direction. But it was a discontinuity from 20-odd trained or 15 to 20 well-trained sellers down and distributing the knowledge across the TeamViewer sales force, but that is largely done. And now it needs rigor, cadence, systems and pipeline -- additional pipeline build, which Mark is working on together with the President. I don't know, Mark, whether you want to chime in.

Yes. No, absolutely. Obviously, it's always disappointing when you lose people. And that was a shame because it does disrupt the way that we ran the business. I think we have retained really key individuals. I mean, as with all these things, I mean, we can hire new sellers, we can train the TeamViewer sellers and we have done, we can ramp people quickly and me now taking over sales and putting in the same rigor and discipline we had on the 1E side last year into the wider entire TeamViewer enterprise motion, I think, will be beneficial because we really drive that kind of deal execution across the board. But we have retained a lot of really key product people, which is really important because there's a lot of deep domain expertise and knowledge around end-user computing, automation, decks. And a lot of those people remain within the business and committed, and we've even elevated some of those people. So not all doom and gloom really. I think there's actually -- we've retained a lot of good people. But yes, obviously disappointing and it has impacted our performance this year by losing some key personnel.

And maybe one mini add-on from my end, Alice, to end also on a high, what is important to the loss on some of the sellers. What we did not lose is the CSMs, the former 1E CSMs. They are with us, and they're obviously super key and vital. And this is what is important for Mark now ramping the overall seller team of 250 into full DEX capability, sales capabilities. The CSMs play obviously a vital role. So that is obviously maybe a little bit on the high end.

The last question comes from Mohammed Moawalla from Goldman Sachs.

I had 2. The first one was just on 1E. I remember at the time of the acquisition, you sort of anticipated stand-alone growth in the sort of mid-teens and I think post synergy in excess of 20%. How feasible does this sort of target look at least in the next sort of 12 months given some of the issues that you need to work through? And then secondly, I noticed sort of R&D was flattish. Was this just a sort of quarterly blip? Or do you feel that R&D will start to kind of grow again?

I can start with the second. So it's a positive mix of seasonality and in-sourced, which was formerly outsourced and hiring in, let's call it, less cost-intensive areas like India and Portugal. This is the mix of the 3.

Yes. First question, maybe, yes, you're right in how you describe the targets. I think the targets are the right targets. Obviously, we're working through sales methodology, building pipeline, significant building pipeline converting the deals. I think if we look at the comp base, comparable base of 1E, clearly, this year, not a strong year as we have discussed multiple times and significant headwinds we had this year with the downsell in some quarters of some customers and loss of some customers. So if we take that picture and look at kind of 2025, it is a difficult picture, difficult performance. I think it's -- when you go back in history, 1E didn't have that for a long while and never for this. And then if we look at the pipeline, it doesn't need a significant deal conversion or need some deal conversion, but not miracles to get back to double-digit growth and then towards mid-teens.

So when we will be there, we don't know. That's why we're cautious also for 2026 revenue. Clearly, this is enterprise and enterprise is always back-end loaded. So the way we think about it is this year, we gave clear guidance on ARR outcome. This will translate into revenue effect. We will work hard to convert the pipeline in Q1, Q2, Q3 and then also Q4 next year. But because we don't know when exactly this will kind of really accelerate, we have been taking a very cautious approach to revenue development next year. I think it's fair to say that we really kind of put in the floor there at the bottom to make sure that we're in a great position towards next year. But 1E needs to accelerate, and that's what Mark is working on and the pipeline is developing very nicely for that. Mark, I don't know if you want to add.

Yes, absolutely. I mean, I think one thing I would say is that, obviously, through this year, as we know, we've been talking about 1E stand-alone performance hasn't been great. However, we now have more than 200 sellers enabled on selling the 1E solutions, the depth and automation. It's a very high-profile topic in enterprises. I mean, effectively, what we're taking to market with DEX is a way to take an agentic approach to how we think about IT support. And that's a very relevant topic for every enterprise today. And every enterprise is looking at how do we automate more, how do we use AI in order to improve the way that we do IT support and cut down costs, et cetera.

Look, this is a really hot topic, and now we have way more sellers out there talking about this and talking to customers. So we're seeing pipeline go up significantly. It was a short-term pain to go through that process of integrating their businesses very quickly, train everyone, disrupt the 1E way of working. But I do believe that we're now set up for success. And as we go into next year, now we can really focus on deal conversion, and I think we'll see -- start to see a better performance. But as Oliver said, we're cautiously taking a cautious approach there. But we're very, very focused now on how we run the business, the deal flow, the discipline around the sales organization, the number of POVs coming in, et cetera, et cetera. So all hands on deck really to drive that performance.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to Oliver Steil for any closing remarks.

Yes. Thank you very much. Thank you once again. Thank you for the questions and your time. Also early and on short notice. Actually, honestly, thank you, Mark. It's 2:00 a.m. or was 2:00 a.m. based out of Florida. Thank you for joining. And look, we look forward to keeping you updated on our progress. All hands on deck, as Mark said, working through the quarter. I think we now have a guidance out there for Q4 and also for next year, which is kind of kitchen thinking. And from here, I think we can work towards performing against this new baseline.

And we feel we have all the instruments and pipeline in our hands to move this in the right direction. So looking forward to speaking soon again, keep you updated. And obviously, we will engage with investors quite a bit also during the course of the day and the next few days to answer all relevant questions. Again, thanks for the time. Appreciate your questions. Bye-bye.

Good morning, ladies and gentlemen, and welcome to TeamViewer's 2025 Q2 Earnings Call. My name is Youssef, the Chorus Call operator. This conference is being recorded.

[Operator Instructions] The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Bisera Grubesic, Vice President, Investor Relations. Please go ahead.

Thank you, operator, and good morning, everybody. Welcome to TeamViewer's Q2 earnings call. I am Bisera Grubesic, Head of IR, and I am joined today by our CEO, Oliver; CFO, Michael; and CCO, Mark.

Oliver will run you through the quarterly business highlights. Mark will talk about our new product launches in the DEX and digital workplace space and Michael will present the financials. The presentation will be concluded by a Q&A session.

Same as in Q1, we will present non-IFRS pro forma top line and adjusted EBITDA performance. And please note that you can find the important notice and the APM disclosure on Slides 2 and 3. And with this, I hand it over to Oliver to kick off our presentation.

Thank you, Bisera. Good morning, everyone. Also welcome from me. Thank you for joining our call today. As always, let me begin with the highlights of the last quarter.

I think in the second quarter, we made really good strategic progress with our enterprise business as an important driver of our performance with a strong double-digit increase of 15%. It contributed a lot to our solid pro forma revenue growth of 6%, both numbers in constant currency and year-over-year.

And as you know, the second quarter is rather not our strongest as we are really in pipeline build mode for the enterprise business for the second half of the year, we really believe that these are good results.

The pro forma ARR increased by 4% in constant currency. We would say that our performance in the last quarter was somewhat impacted by the difficult macro environment in the U.S. market, which I will talk about a bit more in a few minutes. It's important to mention that we already see very promising pipeline for the second half of the year, as we would expect, obviously, for the Enterprise business.

Profitability continued to be very strong in Q2 with adjusted EBITDA up 17% year-over-year and a really strong margin of 44%. This is a significant increase of 4 percentage points year-over-year.

We also made very good progress with the integration of 1E technology into our product portfolio. During the last month, we delivered several platform enhancements as we announced first DEX Essentials and then TeamViewer ONE as the platform proposition.

Mark will go deeper into these product updates later. But I think I can already say that we are seeing promising early momentum in the digital workplace offering, so DEX Essentials and TeamViewer ONE, very pleased with this.

Obviously, we know that we continue to operate in a pretty volatile global economic environment. And we're trying to be prudent and cautious, but we do expect a clear growth acceleration in the second half of the year.

And based on our strategic progress, we are really confident to reach our targets. And therefore, we reiterate our pro forma full year 2025 guidance.

Let's now look at the regions and customer categories and how they developed in the quarter. Revenue grew across all regions in Q2, strong growth in EMEA and also really encouraging development in APAC. I think both underscore the resilience and the adaptability of our business, while the headwinds in the U.S. impacted our performance in the Americas to some extent.

EMEA was our strongest region in Q2, delivering almost EUR 100 million in revenue, which is up 8% year-over-year. And that's despite the global macroeconomic uncertainties.

I think EMEA really proved to be a reliable growth engine. The region benefited from robust enterprise growth, underlying the value and the relevance of our offering.

In the Americas, second largest region, we generated EUR 72.7 million in revenue, which is a 3% reported growth and 5% in constant currency. Obviously, the political environment in the U.S. resulted in overall uncertainty that affected customer decision-making.

In addition, it really led to some budget cuts in the federal public sector and this impacted 1E as 1E is traditionally relatively strong in the government space with large customers there.

So that was a bit a worry going into Q2. But that said, we actually did retain the key federal clients, like, for example, the U.S. Department of Veteran Affairs, which is a huge deal for us, which, in our view, really demonstrates the critical value of our solutions to such organizations.

SMB sentiment was also a bit subdued, but we did see encouraging early traction with our new offering, which is targeted towards SMB, which is the DEX Essentials, which we launched a few weeks ago, which is going to have general availability actually starting today. So so far, it was a limited go-to-market.

If we come to APAC, APAC delivered EUR 18.2 million in revenue, which is up 3% reported and 4% in constant currency. So clearly, we know there's ongoing macro challenges with China, not an easy market. But given that, the region showed pretty solid growth, particularly again in the Enterprise segment.

And interestingly, we also saw positive uptake of the DEX solutions in the region. So we did win 3 promising paid POVs in South Korea, which, from our perspective, really reinforces the strategic rationale.

DEX will be an important proposition for the Asian market for some key countries like South Korea, Japan and others. And we're really pleased to see that we leveraged our office and team infrastructure over there to already win customers.

So that's a very nice development, which gives us confidence for the cross-sell pipeline also towards the second half of the year.

Across our customer categories, the enterprise business continued to demonstrate strength resilience. Enterprise revenue grew 15% year-over-year in constant currency, reaching EUR 58.7 million in Q2. This performance reflects the consistent demand for our high-value solutions and their strategic relevance for large organizations.

Enterprise ARR grew double digit year-over-year, mainly driven by the continued strength of the TeamViewer Enterprise business. This was partially offset by softer performance from 1E, which, as I discussed before, faced a few headwinds due to the challenges in U.S. and the recent budget cuts in U.S. federal customers.

And in addition, please don't forget 1E was affected by really a quite tough year-over-year comparison and then the general seasonal effects of larger deals in this category coming through mostly in the second half of the calendar year.

If we come to SMB, revenue growth improved a bit compared to Q1 by 1 percentage point, representing 3% year-over-year increase in constant currency. ARR growth was modest at 1%, which I think is reflecting also the broader macroeconomic pressure that smaller businesses face actually globally.

And while sentiment in most markets remains cautious, we're actually happy to see the early traction of our DEX Essential offerings, as I mentioned before already, which I think is a very promising sign of that strategic expansion and that we will have a very interesting offering for the SMB space that we can use to cross-sell.

Let's now look at the ARR value ranges as usual in Enterprise and SMB. So looking at the development of our ARR value ranges, we see continued strength in Enterprise and a more mixed picture in SMB on this page.

In Enterprise, value ranges up to below EUR 100,000 delivered continued strong double digit year-over-year growth, highlighting the healthy demand for our solutions across a wide range of customer profiles.

The largest Enterprise ARR value range above EUR 200,000 was up 8% year-over-year in constant currency. That's reflecting the effect of tougher comps for 1E, the macro difficulties in the U.S. that I mentioned and their impact on larger Enterprise customers, particularly on 1E side.

We anticipate a recovery in this segment as we really see the macroeconomic conditions stabilizing now. And we see very good momentum in the pipeline development for the second half of the year with larger pipelines in 1E and TeamViewer and cross-sell, bigger deal sizes in January towards the second half of the year and also improved conversion rates.

In SMB, new customer inflow was more muted and ARR growth was primarily driven by the highest value range, as you can see here. This is always reflecting the very successful upselling into higher tiers as more customers adopt richer product packages. This is also further supported by our continued net upsell to the Enterprise segment of EUR 16.8 million in this quarter.

Let's now have a quick look at the progress of our integration with 1E o the next slide, please, before Mark then elaborates on the expanded DEX and digital workplace offerings.

So integration of 1E is progressing fully in line with our expectations, very positive, continues to unfold as planned. I think actually even a bit faster than we had originally thought on the product side. We did achieve major milestones already with new products and also develop the corresponding go-to-market strategy.

Again, all of this will be explained by Mark in a bit. But we are all very proud of the team delivering such significant steps forward in a relatively short amount of time.

Remember, we only closed the transaction end of January and we already have integrated product offerings out there in the market, which DEX Essentials being on GA actually today.

If we look at Process & Infrastructure, as you would expect, we've begun consolidating key systems, including R&D tools, CRM and other core infrastructure. This does not only support operational alignment, but it really opens up further opportunities for some efficiency gains as well.

As we move forward with our transition plan, we will continue to assess and capture synergy potential wherever possible in this post-merger integration as well.

With this, let me hand it over to Mark, who will give you an update on our combined product offering. Mark, please?

Thank you, Oliver, and a warm welcome from me also to everyone. I'm very excited to guide everyone through the enhanced DEX capabilities Oliver mentioned briefly several times today and explain the strategy behind them and what will drive significant growth acceleration in the second half this year.

Our second quarter saw significant progress regarding the ongoing integration of DEX technology into TeamViewer's portfolio and platform. In May, as you already know, we introduced DEX Essentials, a new offering designed to make DEX capabilities available to a much larger market, specifically the SMB businesses.

It is available as an add-on to our commercial remote connectivity solution. So a very easy way for customers to add this to their current products.

DEX Essentials is based on 1E technology, which was originally intended for very large enterprise organizations. We have adapted it to meet the needs of those smaller IT teams.

We already see good momentum, even though we introduced it into a curated sales motion through inside sales and to selected customer groups only, we will make it available to the entire customer base and through more sales channels from this week onwards.

Strategically, DEX Essentials is laying a very important foundation for further development. Firstly, we are significantly expanding the potential customer base for DEX products and we are looking at a substantial upselling potential with our existing TeamViewer client base of more than 600,000 customers.

Secondly, this is a very -- this is very important. With DEX Essentials, we are introducing a different pricing logic to TeamViewer customers, namely a per endpoint price. This brings me to TeamViewer ONE, the unified digital workplace management platform that we also announced in May.

With this, we are meeting the significant demand of IT buyers for tool consolidation with a complete IT management suite from a single vendor.

TeamViewer ONE brings together endpoint management, remote connectivity, AI and DEX into a single platform. This is where the market is heading and we are already delivering this to capture the latent demand for an integrated single platform. And clearly, with DEX Essentials, we are strategically paving the way for ultimately upselling DEX Essential customers to TeamViewer ONE.

On top of that, we are proud that the strength of the TeamViewer's DEX technology was confirmed by an independent source at the end of May. As you can see on the right-hand side, we were recognized as a leader in Gartner's Magic Quadrant for DEX management tools. This is the first time since the 1E acquisition that the TeamViewer brand shows up in this relevant industry analyst report.

Important customer wins in the DEX space since the closing include one of the world's largest law firms, amongst many others. As Oliver outlined, the U.S.-related political uncertainties impacted the 1E sales motion given that 1E has significant exposure in the U.S., particularly in the public sector, where efficiency programs and budget cuts are affecting IT spend.

However, despite these setbacks, we have managed to retain key customers. Equally importantly, we are in good conversations with potential new customers and the DEX cross-sell pipeline into TeamViewer's existing customer base is very promising.

Almost all mid- to large enterprises today are looking to deploy DEX technology. These cross-selling opportunities from a key -- form a key part of our go-to-market strategy and it is great to see that we are moving forward as anticipated.

We expect a lot more traction and higher win rates now that sales enablement for the new integrated products has progressed significantly across all sales teams and in all regions. Integrating 2 teams, systems and infrastructures has made significant progress so that we can expect focused execution in the second half of the year.

In summary, we are receiving excellent feedback from the market regarding our new DEX and digital workplace offerings despite the challenging macro. Everybody understands the beauty of combining on-demand remote support, proactive issue detection and remediation from DEX.

We have a promising pipeline in place, including a very good proportion of larger deals and we expect a good conversion towards the end of the year as is typical in the Enterprise business. That said, we anticipate to deliver growth acceleration in the second half of the year.

Thank you very much. Back to you, Oliver.

Yes. Thank you, Mark. I think beyond the developments in the DEX and the digital workplace space, obviously, we're also not standing still on the original TeamViewer side. And TeamViewer, we also made very strong progress with our AI offering in the second quarter. We have consistently expanded the AI features since their launch in the last year.

And in addition to the session insights and the analytics capabilities that we had introduced already in October of last year, we've now added TeamViewer Copilot, which is an AI assistant, which is embedded inside our remote support product and works throughout the remote support sessions.

So how it works is then an IT service desk agent can then chat with the Copilot in real time, for example, to access device data, diagnose issues, generate resolution workflows or then even automate everyday tasks.

Beginning of July, we bundled the AI capabilities into a single add-on for our customers, which is named TeamViewer Intelligence. And with our enhanced AI offering and our leading DEX capabilities, we position TeamViewer now at the forefront of the digital workplace transformation and we are very confident to capitalize on the early successes that we have in this space already.

So if I conclude this part of the presentation, I think we achieved very relevant milestones in the second quarter. We are reiterating our full year guidance and we expect to deliver growth acceleration in the second half of this year.

We made very good progress with our product integration and the launch of new products in the digital workplace space. And now we have an enhanced offering for Enterprise and SMB customers.

We have targeted go-to-market strategies in place for all our products and we are improving the customer journey and the sales channel specifically for SMB to reignite growth in that space as well. And like this, we are unlocking new cross-sell opportunities in this segment.

We've completed a good portion of the integration work in the first half of the year already, so we can fully concentrate on execution in H2. And we see really good progress on pipeline development with larger pipeline for TeamViewer, for 1E DEX and also for cross-sell with higher value deals and we expect to materialize particularly in Q4 when Enterprise business typically sees a seasonal peak as you've seen in the previous years as well.

And with this, I would like to hand over to Michael now for the financial overview. Thank you.

Thank you, Oliver and Mark, and good morning, everyone. Let us now have a look at our key financials for the second quarter of 2025.

Next slide, please. TeamViewer delivered a solid second quarter. Our revenue reached around EUR 191 million, up 6% year-over-year in constant currency. Strong growth in the EMEA region more than offset the softness in the U.S. market and our profitability remains strong.

Pro forma adjusted EBITDA increased by 17% year-over-year to EUR 84 million, resulting in a significant year-over-year margin expansion from 40% to 44%.

Profitability benefited from optimized marketing spend in the sponsorship area. Pro forma adjusted EPS was up 90% compared to TeamViewer stand-alone in the prior year, reaching EUR 0.28 for the quarter.

And I'm pleased to share that our pro forma net leverage ratio further improved to 2.9x, down from 3.1x in Q1 '25 and is fully in line with our deleveraging targets.

Now let's dive into the details of our Q2 results. Next slide, please. Pro forma revenue in Q2 grew by 6% year-over-year in constant currency to around EUR 191 million. TeamViewer stand-alone contributed EUR 174 million, also growing 6% year-over-year.

This was supported by a strong Enterprise momentum over the last 12 months in the EMEA region. 1E stand-alone generated EUR 70 million in pro forma revenue, reflecting a 7% increase year-over-year in constant currency. 1E's revenue growth was affected by tougher year-over-year comps due to its U.S. Department of Veteran Affairs contract that was signed last year in Q2, seasonal effects and additional headwinds due to recent U.S. federal budget cuts.

ARR grew by 4% year-over-year in constant currency and reached EUR 759 million. As Oliver explained, the Enterprise ARR grew by double digit percentage year-over-year, driven by the continued strength of the TeamViewer Enterprise business.

This growth was partially offset by softer performance from 1E. Sequentially, ARR was broadly flat, primarily due to the challenging U.S. market conditions during Q2 and also sequential negative [indiscernible] effects. Importantly, our profitability remained strong with an adjusted EBITDA margin of 44%.

Let us continue with our Enterprise business on Slide 14, please. Enterprise continued to deliver double digit growth in both revenue and ARR, underscoring the fundamental strength of TeamViewer's core business.

Pro forma revenue reached EUR 59 million in Q2, marking a 15% year-over-year increase in constant currency. ARR also grew by 13% year-over-year in constant currency, reaching EUR 227 million by the end of the first half year. This performance was primarily driven by the EMEA and the APAC regions, both of which demonstrated a solid Enterprise momentum.

Given the nearly all 1E's business falls within the Enterprise category, the macroeconomic uncertainties in the U.S. had a notable impact on overall growth. Additionally, year-over-year growth in Enterprise ARR was tempered by the high-value deals 1E secured in Q2 of last year, which led to tough year-over-year comps as we discussed during our last call in May.

The Enterprise net retention rate, which had benefited from 1E's contribution in Q1 and the high-value deals 1E secured in Q2 of last year declined by 5 percentage points to 98% in Q2. Adjusted for the upsell from SMB customers during the period, Enterprise NRR reached 103%.

As shown on the top right of the slide, the number of Enterprise customers continued to grow, both sequentially and year-over-year, reaching now 5,143 customers at the end of the quarter. Pro forma Enterprise ASP remained steady at EUR 44,000 per customer.

Let's now move on to our SMB business on Slide 15. Naturally, the broader macroeconomic environment also influenced our SMB customer base. Given the prevailing macro sentiment, our SMB business delivered a solid performance in Q2. The pro forma SMB revenue reached EUR 132 million for the quarter, up 3% year-over-year in constant currency. This reflects a 0 percentage point improvement in growth trend over Q1.

SMB ARR grew by 1% year-over-year in constant currency, totaling EUR 532 million now at quarter end. This growth was supported by good traction in the EMEA region, partially offset by the slowdown in the Americas. SMB counted 651,000 customers at the end of the quarter. Somewhat lower customer count was preliminary due to slightly higher churn and limited new customer inflow, both linked to the temporary macro challenges in the U.S. market in particular.

Our SMB ASP was up 3% year-over-year and reached EUR 817. This demonstrates our ability to expand the business with existing customers through effective cross and upselling initiatives.

As part of our ongoing efforts to increase customer value and drive monetization, we have recently embedded new webshop functionalities directly into our products. These enable personalized add-on offerings based on actual customer usage, creating a more tailored and seamless upselling experience.

We expect this to have a positive impact on our SMB business alongside the rollout of DEX Essentials and our AI-powered features, both of which open up additional upselling potential.

Let us now take a look at our cost base on the next slide, please. The pro forma adjusted EBITDA margin improved significantly by 4 percentage points year-over-year, reaching now 44% in the quarter.

This was driven by our optimized sponsoring spend. Most recurring cost items as percentage of revenue remained stable or slightly declined compared to the same quarter last year.

As previously communicated, we saw a sequential increase in marketing expenses of around EUR 5 million, primarily due to the launch of our new Make Work with Better brand campaign at the end of April.

Despite this, total marketing costs were 12% lower than in Q2 2024. Our primary areas of investment were sales and research and development, which increased by 7% and 8% year-over-year, respectively.

These investments were focused on hiring new talent to support our sales efforts across all regions and to drive the development of innovative product features, some of which Oliver and Mark presented earlier.

The gain recorded under other cost items reflect lower bad debt and proceeds from the derivatives during the quarter. Overall, the recurring costs decreased by 2% year-over-year, whilst we continued to invest into strategic growth initiatives.

Let us move on to net income and EPS development on Slide 17. Pro forma adjusted earnings per share was EUR 0.28 in Q2, up 19% year-over-year compared to TeamViewer stand-alone. For further details, please refer to the pro forma adjusted net income bridge on Page 12 of the earnings press release.

Main driver for this strong result is the optimized sponsorship cost and the 1E contribution in the quarter, which led to an IFRS EBITDA of nearly EUR 83 million, up 38% year-over-year compared to TeamViewer stand-alone.

Total interest expenses for the quarter amounted to EUR 10.4 million, an increase of EUR 5.7 million year-over-year, driven by the financing of the 1E transaction. Financial FX result increased by EUR 21 million year-over-year.

In addition to the EUR 5.7 million interest impact, the FX result reflects negative translation effects related to an intercompany loan, which is required under IFRS. Our share count was around 3% lower year-over-year due to our continued buybacks during 2024 and this further supported the EPS growth in the quarter.

With this, let's move on to cash flows on Slide 18. Adjusted for the nonrecurring items related to the 1E acquisition, levered free cash flow amounted to EUR 59.6 million in Q2. This translated into a strong cash conversion of 71% for the quarter. For the full year, we continue to anticipate a cash conversion rate of around 70% at guided FX.

Other factors influencing cash flow in Q2 included higher working capital, driven by phasing effects from high-value contracts and increased interest payments related to the 1E acquisition. This was partially offset by lower tax payments, which mainly result from changes in our tax scheme and phasing effects.

I will now give you a short update to our financing on Slide 19. We continue to deleverage in line with our targets following the 1E acquisition.

During the quarter, our pro forma leverage ratio improved further to 2.9x, down from 3.1x in Q1 '25. Cash and cash equivalents amounted to around EUR 41 million at the end of the first half of the year, down around EUR 50 million compared to year-end 2024.

CapEx and acquisition costs for 1E of EUR 686 million were balanced by our operating free cash flow of EUR 110 million and borrowings of EUR 590 million.

As of 30th of June, financial liabilities amounted to roughly EUR 1 billion, an improvement of around EUR 130 million compared to the end of Q1. Net financial liabilities totaled EUR 992 million at the half year mark.

Despite ongoing macro challenges, we remain firmly committed to disciplined capital allocation. Combined with our strong cash profile and solid cash conversion, this positions us well to achieve our leverage target of around 2.6x by year-end 2025 and below 2x by the end of 2026.

Let us continue with our financial guidance on the next slide. We delivered a solid performance in the second quarter. These results are particularly noteworthy given the difficult conditions in the U.S. market, in particular, the uncertainty and delayed customer decision-making affected the overall environment.

Looking ahead, we reiterate our full year guidance. For full year 2025, we anticipate continued top line growth on a pro forma and like-for-like basis as outlined in the table.

We expect the ARR growth to range between EUR 815 million to EUR 840 million, which reflects between 7.5% and 10.8% year-over-year. We expect full year pro forma revenue between EUR 778 million and EUR 797 million. This translates to between 5.1% and 7.7% year-over-year growth.

Let me remind you that our full year guidance is based on a euro-dollar exchange rate of EUR 1.05. At an assumed yearly average rate of $1.14, the ARR range would be reduced by around EUR 24 million and the revenue range would be reduced by a low-teens million-euro amount, EUR 10 million to EUR 12 million. Our guidance implies a growth acceleration in the second half of this year.

Let me outline why we expect this acceleration. First, I have been with the company now for 3 years and our expected growth acceleration aligns with seasonality patterns observed in the previous years. And this trend is once again evident in the strength of our pipeline.

As Oliver and Mark explained, we are already seeing a larger pipeline and higher conversion rates. Strength in the sales execution in recent months is expected to drive improved win rates. Additionally, we anticipate larger deal volumes, particularly in Q4 when Enterprise typically experiences a seasonal peak.

Second, we are starting to see ARR synergies from the 1E acquisition. Although our new DEX offerings have only just launched, we've already secured promising leads from our existing TeamViewer customer base.

And third, we are improving the customer journey and sales channels, especially for SMB to reignite that space and unlock new cross-sell opportunities for our AI and DEX offerings. For example, with our new in marketplace and a broader adaptation -- adoption, sorry, of the new UI.

Fourth, in that context, we will continue to run targeted go-to-market campaigns to strengthen performance across all of the regions. And finally, with the team integration progressing very well, we are now shifting our focus from organizational alignment to operational execution, which enables us to drive growth more effectively.

We will continue to monitor macroeconomic developments closely and remain disciplined in our approach. That said, we are confident that the measures we have outlined position us well to achieve our targets for the full year.

With this, I would like to hand back to the operator to open the Q&A.

[Operator Instructions] The first question comes from Mo Moawalla, Goldman Sachs.

I had 2 questions. Firstly, can you talk about sort of the delta between sort of ARR and the kind of slight acceleration in revenue growth you need to hit the midpoint of your guidance? And what are the kind of factors that underpin your visibility?

I know that the Enterprise business and probably 1E is going to be a bit more back-end loaded in Q4 given the larger deals. But specifically on the SMB side, what is the sort of pipeline that you have around the new sort of next product?

And the second question is on the SMB side, we saw some pickup in the churn now. Any sort of particular reasons for that? And as we think about your marketing spend, do you need to step up sort of campaigns to sort of stimulate this growth in the second half as well?

So yes, as you say, ARR acceleration on the Enterprise side, I think it's pretty clear. I read your question as that pipeline coverage is well understood. And it's just -- it's not a little bit seasonal.

It's really significantly back-end loaded as we've seen in other years if you look at Q4. And then also with 1E, this is even more the case because the deal size is larger and it's more strategic purchase or procurement decisions, which are typically taken more towards the end of the year with budgets being available and so forth. So I think that's pretty clear.

SMB, ARR acceleration on SMB, yes, we need a notch up in terms of growth when we go through the year. Clearly, there has been a lot of focus on Enterprise recently and then the 1E acquisition and the integration work.

In parallel, we have reworked our campaign structure for SMB. We've also reworked the in-product presentation of cross-sell opportunities. We are also rolling out our newer remote product with a new UI.

If you are on the new product as a customer, then it's much easier to access and purchase cross-sell products in remote management, patching, DEX Essentials then also and so forth.

So there's a shift going on in the customer base to move the customers to the new UI and by that, have more opportunities to do in-product promotions and direct on-the-web purchases. So there's a significant shift in how we speak to our customers and address cross-sell.

And then thirdly, new products and new own products. So DEX Essentials and TeamViewer ONE are our own products with our own functionalities fully integrated with the TeamViewer core proposition. So this is a significant shift.

As you know, the cross-sell products in the SMB space, notably endpoint protection, patching are third-party products, which are OEMs and then integrated into our flow. That's good, but it's obviously much, much better to have the latest and greatest functionality in IT automation, which we have with TeamViewer ONE and Dex Essentials.

And that's why we have been pushing a lot to bring this to market quickly. As I said before, general availability is only today, actually really today at noon. And from there, we will drive the cross-sell initiatives.

So these things are important on the kind of marketing, product positioning and sales side for SMB. And then they will have -- we will have a washout of like-for-like price increases that we did in the past.

So we will have less tough comps on the pricing side. And we also would see the churn initiatives that we've put in place last year coming to fruition more and being effective. We see early indications there in the Americas and significant improvement on the churn in SMB in APAC over the last quarters and we believe that this will continue to be the case.

So this is ARR, SMB. I don't -- I think I almost covered the second question as well.

No, that was on the campaigning and whether we have to step up on the spend in marketing, especially with what Oliver outlined, we did accelerate the spend in Q2 for all the purposes we explained.

So that should come rather down with all the new initiatives which are in product. So rather less spend. That's the idea.

Maybe the last one on the SMB trends that was really driven by the U.S. So it's really -- we believe and see and hope that this is to the macroeconomic situation, which should really cool down now.

The next question comes from Florian Treisch, Kepler Cheuvreux.

My question is, again, on the SMB space, but more related to DEX Essentials. I mean, you mentioned the general availability starting today. Can you give us some feedback on the last couple of weeks or let's call it, testing the market period?

What is the feedback from clients? What do you believe is the realistic ASP assumption here? I mean, it's probably just out today. So maybe give us some color on the pricing strategy here and what you believe can be, let's say, the add-on growth for SMB overall in coming quarters?

Yes, happy to. So I'm going to disclose all the details on pricing and positioning here in a call like this, but because also there's a competition out there, we are ahead and we want to stay ahead. So what are we doing?

So DEX Essentials is a reduced version of the DEX proposition. So it's a set of key automations to remediate common widespread IT issues on customer endpoints. We target customers that in the SMB space that are managing a couple of hundred endpoints up to a few thousand maybe.

So that's obviously important that you have an amount of endpoints that you're managing. So then naturally, if you think about our SMB segmentation, that fits nicely into the customers that buy premium and corporate licenses, so say, customers that are sitting in license count above euro amounts of EUR 1,500 -- between EUR 1,500 and EUR 10,000. So that's the sweet spot.

Heavy users of our product, managing a good set of IT endpoints and we position the product to this. Through inside sales, so this is an assisted sale with a person. And what is most important in these things is the feedback you get from your sellers early on when they touch the product and talk to customers.

And this is very positive feedback. So we've closed a very good number of deals already with customers. Customers understand the proposition. It is an obvious add-on to what we do because it is allowing for some self-healing or self-remediation of issues on the IT side.

Pricing-wise, interesting. This is endpoint-based pricing. So as you know, TeamViewer in general is channel-based pricing or mostly seat-based pricing. Here, we move to endpoint-based pricing, which is where the market will go.

Also, if you think about a proposition like TeamViewer ONE, this will also -- or is also going to be endpoint-based. So this is a step into endpoint. So the customer has a license with us, which is technician-based and then tells us how many managed devices they would move to the DEX Essentials platform and that's then priced per device per year in a nice single-digit euro amount.

And if you put that all together, then you see that it's a meaningful upsell if you take a EUR 2,000 license or so and then take a EUR 1,000 endpoint situation and you take the pricing I just mentioned, you find that it's easily a 40 -- 30%, 40%, 50%, 60% upsell if customers decide to add DEX Essentials.

So that's how we're playing around with it. So early days, as I said and as you said, general availability today and then we will take it from there, but promising early results. I hope that answers your question.

The next question comes from Alice Jennings, Barclays.

I just had a couple thinking about the ARR acceleration for H2. So firstly, you spoke on the call about an improvement in conversion ratios in H2.

But I was wondering if you could quantify how much of an improvement you need compared to historical conversion ratios in order to achieve the midpoint of that ARR guidance? And then also from a phasing perspective, so you've spoken to a back-end loaded acceleration in ARR growth, especially in Q4. But how much can we reasonably expect to see already in the third quarter?

So I think the -- your first question, 100% right. So obviously, we track pipeline and we have a historic view on conversion rates if we go into Tinder Enterprise and also 1E because we're both tracking -- we were both tracking pipeline in the past, different systems, but we have merged the 2 systems now.

And so we have a view on this. What we're assuming when we go into the second half of the year and how we look at the pipeline is actually the historical conversion rates that we were seeing in previous years. I think the -- what is fair to say is that Q1 and Q2 -- especially Q2 conversion was low because of the macro uncertainty.

So we don't need any conversion uptake in the second half, which goes above and beyond what we've seen last year or the year before or the year before, just normal course of business with good conversion of the deals. I think the problem of the business so far and I think for many companies is that the conversions actually have been lower than historical comps. And that we believe will normalize and ease out.

To get to midpoint of guidance, we have obviously -- when we did the guidance and the guidance range, which still stands, we have assumed a normal conversion rate, but with some conservatism baked in because when we did the guidance, we already saw that the market is not in super good space.

And then phasing Q3 versus Q4, Q4 is the big quarter. If you go back last few years, Q4 was significantly bigger in terms of deal conversion, especially also in December was for the bigger deals. It's very normal course of action.

So a little bit will be visible in mostly September, now it's kind of summer break. A little bit will be visible in September already, but mostly we're looking at Q4 here.

And also when you look at the cross-sell pipeline between 1E and TeamViewer, very natural, we only started in the first quarter and these are 9- to 12-month sales cycle. So a lot is actually also for Q1, Q2 next year. But in Q4, we have a good shot with a good number of deals.

The next question comes from Ben Castillo-Bernaus from BNP Paribas.

Two for me, please. Obviously, plenty of new product innovation announced now. So I guess, how are you thinking about the penetration of your installed base here as you look forward 12 months from now, what would be a good achievement in your view in terms of how much of that installed base you can sell this to?

And then second question is on the 1E outlook. I recall you were guiding for 17% to 23% growth here for 1E stand-alone. Is that unchanged? Obviously, the group guidance is unchanged. I'm just wondering if there's any moving parts there with 1E versus TeamViewer stand-alone.

Yes. Let me do the second one first. So the breakdown of 1E and TeamViewer is not a guidance. This is further information. We give a group guidance.

All of the details is further [ detailation ]. So how we manage the guidance is in the end not relevant as long as we manage it and we are in full swing factor here and especially what Oliver mentioned with a big pipe here on increasing also big deals, size deals. We are super confident on both ends. But in the end, what matters is the group that maybe...

Yes, maybe adding to this, I think the difference is just also the type of deals in 1E, I mean, they are -- they can be very sizable, sizable customer situations, very strategic deals. And depending on the outturn of this, that changes the pivot towards 1E or towards TeamViewer.

So I think this is quite a range of outcomes here on the 1E side. And therefore, I think it's hard to predict at the moment how this will play out. And then there is the cross-sell between the 1E and the TeamViewer and the TeamViewer ONE proposition.

We do want platform consolidation and integration. So we need to see how this shapes out. We focus a lot on the platform play, the TeamViewer ONE and the large deals on the DEX side and that's clearly driving factors.

On the first question, Ben, penetration DEX Essentials. So it's too early, I would say, to give you a number for a 12 months out what does success look like. We are very positive on how quickly we've been able to sell it and how quickly our inside salespeople, first just a few and now most of them are touching it. So that's good.

Significant number of quotes out to customers. Now GA starting today. With GA, we're changing the pricing a little bit as well because we were testing with it in different markets and see what the right price points would be. So there's a little bit of testing ongoing.

And in parallel to this, we're rolling out the new UI faster, which makes it much easier to also then add cross-sell products. So with this, I think we will probably need to be in the next earnings call after Q3 with 3 months of GA under our belt to then talk more about numbers and trends and from there, give you a number of where we could be 12 months from now.

The next question comes from Gustav Froberg from Berenberg.

I have a quick one on 1E and the VA contract. Could you remind me there, is this contract renewed on an annual basis? You talked about renewing it now. So should we expect a renewal for next year same quarter as well?

And then a question in a similar vein. As you change the pricing structure a little bit, are you thinking about changing contract durations as well to kind of enhance visibility in the business? Or are you sticking with what you're running at the moment?

So answer is VA is a multiyear deal, but that is formally being reconfirmed, renewed on an annual basis, so again in Q2 next year. So that's an easy one.

And then on the contract side, no, no change on contract. Length we have for the SMB, I think annual contracts upfront pay is the standard. When we move to additional products, we changed the pricing or we add a pricing parameter, which is endpoint-based pricing, but we still keep the annual logic for the vast majority of our customers, that's 100% the right thing.

You can argue that at the very entry level, consumption-based postpaid monthly or so could be something that you could think of, but we don't believe we should go that way.

And then on the upper end, which is probably more what you're referring to, we have multiyear deals. The bigger the deals, the more strategic the deals on TeamViewer attempts or upper end and even more so on 1E DEX. Clearly, customers typically want to commit for a longer time with annual payment or upfront payment. So this will be more and more the case.

And yes, that does increase visibility. But I think it's more a normal development. The more we go into Enterprise, the more this is part of our business, longer-term customer contracts with increased visibility.

The next question comes from Victor Cheng, Bank of America.

Two, if I may. I guess, first of all, on retaining the Fed customers or maybe more generally as well. Are there any concessions maybe in terms of pricing or anything else for that to go through? Do you see any pressures on that end going forward as well?

And then secondly, on margins and Q2 margins at 44% already. Generally, H2 margins, I guess, specifically for Q4 should be a bit higher. You haven't changed your full year guidance on margins. So how should we think about H2 margins as well?

Yes. Let me take the first one. Yes, I think especially in Q2 with federal customers or customers that are affected by federal buying behavior, this has been a little bit of a wrestle. Of course, there is -- you need to do something in most cases.

And I think you heard from other software companies, I'm sure, that they had to do something. Some actually got kicked out. We know from quite a few software vendors that just kicked out completely.

So I think question #1 is, do you have a strategic proposition with these customers such that they keep the offering, which was the case, which is good. And then it's a give and take to reduce the scope of licensing or give some price concessions here and there.

In our particular case, I think it was a little bit of a rescoping to kind of create some savings, a little bit of repricing to create some savings and postponing some of the upsell opportunities that we originally had seen and had baked into our plan. So a little bit of everything there.

From our perspective, early days, but since a few weeks, it seems to -- the regime seems to have changed a little bit. Obviously, everybody is cost-conscious, but I think seems the worst is over in this respect with the discussions we were having.

And obviously, also changes in the personnel setup in the U.S. and then with the big bill that has been pushed through now, I think the backdrop has changed quite materially from our perspective and we think that the worst is over on that one.

But obviously, we stay alert and we look at all our customers. But none of the customer by far has that profile and size that we had in the Q2. So it's much more normalized comps now quarter-over-quarter if we go into the second half of the year. With this, maybe, Mike, on the margin.

Yes. On margin, so Q1 43%, Q2 now 44%. You could take indeed a look. We are rather looking at this from a prudent perspective. For the second half, we expect again something between 43% and 44%. We thought it's too early to call it victory here.

It's still a half year, the macro overall situation. We think the sentiment improves, but we stay on alert mode. And let's see how this works out. But for us, today, it would have been too early. But in general, Victor, you're absolutely spot on. We are on a very good road here.

The next question comes from Toby Ogg, JPMorgan.

Perhaps just on 1E, again, just on the slower decision-making and the postponed upsell opportunities that you mentioned there as kind of part of the pieces. Have you closed out any of those postponements yet so far in July? And do you expect to close out these postponements in the second half?

And then again, just kind of coming back to that sort of steady-state growth outlook for 1E given the pressured budget outlook. Any kind of changes to your thinking around what the outlook for 1E sort of looks like kind of steady state given those changing budget dynamics?

Yes. So no, we haven't closed any of these postponements and I wouldn't see us doing so in the next few months or maybe even until the end of the year. I mean, I think we all, all means many software companies, I think we're quite happy and satisfied that we've gone through this phase, secured the customers at a meaningful price point.

And I think -- I don't think you want to go back just a few months later and open that box, probably let it sit there.

But what is important and what we do very actively is focus on the sectors which are actually -- which do spend and have not been affected by this so much. And if you go through 1E, this is clearly banking, financial services.

This is also more and more industrial customers, retail customers, health care customers because the DEX topic per se is really gaining attention around the world. So I think in -- 2, 3 years ago, DEX wasn't very much known.

Now it's really second year Magic Quadrant. So it's front of mind, digital workplace management and there is other sectors that really are looking into this and we focus on those more. So in that sense, we're also trying to go where the spending is and where there's less pressure.

But in Q2, we wouldn't because; a), Q2 is not a big quarter; and b), we had those few deals and this especially big deal that we need to deal with. So I think medium-term steady-state outlook on 1E hasn't changed since we had discussed it in the acquisition.

Ladies and gentlemen, that was the last question. I would now like to turn the conference back over to CEO, Oliver Steil, for any closing remarks.

Yes. Thank you once again for your time and engagement today, as always, good to have those questions and the discussion. We will continue to execute on the strategy. We really believe that strategically, this is a really big win, the acquisition of 1E and the proposition of a platform play with the different parts of it from reactive remote, but all the way to fully upfront automated and autonomous endpoint management.

So we get good interest from our partners, customers, continue to work on this and look forward to keep you updated also, obviously, on things like DEX Essentials. As I just said, next earnings call, we should have more visibility. And looking forward to speaking with you soon, thank you very much.