Good day, and thank you for standing by. Welcome to the IONOS Group SE Q3 2023 conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Stephan Gramkow. Please go ahead. Hello, and good morning, everybody. I would like to welcome you to the analyst and investor call of IONOS on the results of Q3 and the first nine months, 2023. Thank you for joining. My name is Stephan Gramkow, and I'm responsible for investor relations at IONOS. Let's have a look at our agenda for today's call. Britta Schmidt, CFO of IONOS, will give you an update on the business and the development and achievements of the first nine months, and will then walk you through the financial details and highlights of the third quarter and the first nine months of 2023. We will also talk about the current projects and milestones, as well as an update on AI. Britta will then be happy to answer any open questions. I would now like to hand over to Britta. The floor is yours. Thank you, Stephan. Good morning, ladies and gentlemen, and welcome to our Q3 webcast. I'm Britta Schmidt, CFO of IONOS, and it's great to have you with us today as we delve into our performance during the first nine months of 2023 and take a look at our operational trends. To remind you, IONOS is the clear number one European SMB digitalization partner and trusted cloud enabler. Let me start to highlight our four strong business pillars, which serve as the foundation of our success. The base is our Web Presence & Productivity business, excluding Aftermarket, which is the largest pillar, contributing EUR 686 million in revenues in the first nine months of 2023. This business segment also showed remarkable, resilient, and steady growth throughout the first nine months of this year, with high underlying margins and exceptional cash conversion. In a subscription-based revenue model, we cater to all digitalization needs of SMBs, including solopreneurs. We are the leading provider in Europe and have a sizable business in North America as well. Moving to the center of the page, we have our second pillar within our Web Presence & Productivity area with our fast-growing Aftermarket business, which is the buying, selling, and parking of domains. This area contributed an additional EUR 229 million in revenues. However, as the exceptional high growth of the last quarters is coming down to market level, as anticipated, the dilutional effect of this lower margin business on our EBITDA margin is already easing off. Around 10% of our revenues stem from our Cloud Solutions business. Here, IONOS is progressively establishing itself as a trusted partner for small and medium businesses. Although this is our most recent business venture, it is already self-sustaining. We anticipate this revenue to contribute positively to our EBITDA in the near future. Lastly, IONOS has a very strong brand that supports us across all sales channels, as well in retaining our large customer base. Our continuous investments in our brand within our focus markets have led to significant increases in brand awareness in these markets, as already shared during the last earnings call. This encourages us, of course, to continue with this initiative as planned. In the past, we have been fairly cautious with price adjustments. However, we have been constantly reassessing our pricing strategy, particularly in light of the current economic landscape, which offers some flexibility in terms of pricing. It's all about striking the right balance, recognizing the potential growth from price adjustments, while also remaining mindful of their impact on customer acquisition and satisfaction. Due to our stronger-than-ever brand, innovative products that are at the heart of our customers' digitalization, resulting in high customer loyalty, increasing acceptance of price adjustments in the market, and the proven resilience of our target group, we are in a very strong position. As a result, we have decided to begin adjusting our pricing strategy in Q3. We will take this step by step with clear guidelines in place to avoid disappointing our customers. We will actively manage the process, monitor the results closely, and provide an update on any upside to our mid-term guidance as soon as it's appropriate. Now, let's take a moment to review our performance for the first nine months of this year. We've successfully expanded our revenues to around EUR 1,059 million across all business units, marking a substantial growth of 11% year-over-year. Our adjusted EBITDA followed suit with a solid increase of 11.1%, which is slightly ahead of our planning. I will talk about the implications of this when we come to the outlook. Let's have a look at our primary revenue growth catalysts: net customer growth and average revenue per user. As already mentioned in our Q2 webcast, we've made a promising start into 2023, which continued in the third quarter. The reliability of our mission-critical products, backed by the dedicated support of our personal consultants, have helped us to develop and maintain a very loyal customer base. We've kept our churn rates remarkably low, around 13% annually, or approximately 1% monthly. Moreover, we have been able to add many new customers, resulting in a strong net customer growth of 170,000 customers year-over-year, or 130,000 customers in the first nine months, 2023, which compares to 70,000 customers in the same period last year. On the right-hand side, you can see that our ARPU increased by a very healthy 4.66% to 14.6 EUR per month, despite a strong increase in customers. Please keep in mind that new customers usually benefit from starting discounts, so diluting the ARPU in the first six to 12 months. The growth of 4.6 therefore supports our continued and improved up and cross-selling ability. The expansion of our cloud solution business additionally fosters ARPU growth, as average ARPUs are generally much higher. Overall, those numbers demonstrate the successful execution of our business strategy, underpinning our predictable growth in revenue and profitability. Let us have a look at the development of our profitability on page five. Revenues increased by 8.1% in the third quarter, while adjusted EBITDA increased by 11.8%. Marketing investments were comparable to last year, which indicates that the effects of less dilution from the Aftermarket business, lower marketing investments as a percentage of revenue, and economies of scale, which have been described multiple times in the past, are just mechanically resulting in an increase of the EBITDA margin. The strong performance in the third quarter is resulting in a very strong first nine months, as you can see on page six. Revenues are growing at 11%, and adjusted EBITDA is growing at 11.1%. Adjusted EBITDA margin is at 28.9%, which is at the same level as last year. As previously mentioned, this includes the dilutional effect resulting from the exceptional growth in the Aftermarket business during 2023, which amounted to 0.5 percentage points. Therefore, it's essential to note that if we were to exclude this impact, the adjusted EBITDA margin would have increased. This positive change can be attributed to higher gross margins, primarily driven by an improved product mix and the realization of economies of scale, which I have mentioned earlier. In the first nine months, EUR 35 million were allocated to brand campaigns, up from EUR 27 million last year. At the same time, we spent correspondingly less on performance marketing, so that our marketing expenses overall are at the same level as last year. For the full year 2023, we expect brand investments of around EUR 65 million. Originally, we expected EUR 65 million-EUR 70 million, but are, of course, optimizing that flexibility with performance marketing, adjusting to the performance of the different channels. Our focus remains on profitable growth in the allocation of our marketing spend between the channels, which means we will continue to focus on valuable customer growth, measured by CLTV over CAC. By carefully managing our marketing investments along this KPI and capitalizing on the favorable market conditions, we aim to achieve optimal results and drive sustainable growth across our business. Let me start with an overview of the different revenue lines on page seven. We are showing both the nine-month view and Q3. As everyone is usually a bit more interested in the last quarter, let me focus on this. Our largest business area, Web Presence & Productivity, grew 8.4% year-over-year, supported by growth in the Aftermarket business. Excluding the Aftermarket business, Web Presence & Productivity grew by a very healthy 6.7% year-over-year, despite a headwind from FX. Excluding currency effects, Web Presence & Productivity, excluding Aftermarkets, grew by 7.5%. Our Cloud Solutions business, which is still the smallest business in our group, grew by 14.6% in Q3, which is an acceleration compared to the first two quarters. This was anticipated, as the growth in the first half year was influenced by a one-off project with a large customer in the first six months of last year, making this year's comparison more challenging. Excluding the impact of currency headwinds or currency exchange headwinds, our Cloud Solutions business achieved a robust growth rate of 16.3% in the third quarter. We are optimistic about the continued growth of our Cloud Solutions business and are excited about the opportunities it presents for expansion in future. Moving forward, we are committed to enhancing our product offerings and services. Our dedication to enhance the offering, especially in the area of PaaS and SaaS, will further establish our position as a competitive player in the industry. Let's turn to page eight, focusing on capital expenditure. As you know, we have the advantage of having highly predictable maintenance CapEx requirements, which are bolstered by favorable server economics, economies of scale, and our state-of-the-art technology platform. This stable foundation allows us to effectively manage and plan for the ongoing maintenance and improving of our operations, ensuring reliable service for our customers. On the other hand, our growth CapEx is directly linked to our future revenue and customer growth prospects, particular in the cloud solution segments, providing a well-defined path to achieving payback on these investments. Maintenance CapEx remains low, with 2.4% of revenues. Growth CapEx is well below previous year, driven by phasing effects of deliveries. We have around EUR 20 million of outstanding deliveries. Based on that, we are slightly reducing our expectations for total CapEx for the full year from EUR 100 million to around EUR 90 million-EUR 100 million, which represents around 6%-7% of our total revenues. This takes into account the anticipated fulfillment of outstanding deliveries. Additionally, we are confident that Cloud Solutions revenue will gain momentum and accelerate, aligning with our CapEx target. By maintaining a balanced approach to our CapEx allocation, we are still in an excellent position to take advantage of growth opportunities, improve our capabilities, and drive sustained and profitable revenue growth. Our leverage and debt position is summarized on page nine. Our debt consists of a shareholder loan from United Internet, featuring a fixed interest rate of 6.75%. It is essential to note that this loan does not include any covenants or payback penalties, which provides us with a favorable and highly predictable financing structure. Moreover, the shareholder loan is set to mature in mid-December 2026. Given the current market conditions, we believe that the conditions of this shareholder loan are quite attractive, offering us a solid and secure financing arrangement with minimal financing risk. As of the end of nine months 2023, we have successfully reduced our net debt to EUR 1.9 billion, which translates to a net debt to adjusted EBITDA ratio of 2.9 times. This reduction in net debt includes a paydown of EUR 30 million of debt in Q3, and we have already paid back another EUR 35 million in October, further reducing our debt in line with our expectations and underpinning our commitment to prudent financial management. On page 10, you can see the reconciliation from adjusted EBITDA to free cash flow. I would like to remind you that we have implemented a new presentation of cash flows to improve the reconciliation from adjusted EBITDA to free cash flow with the first half-year results, with the goal of achieving greater consistency between those two metrics. We have moved the cash outflows for interest from operating activities to cash flows from financing activities. This change aligns with the fact that interest expense is not included in EBITDA, ensuring improved coherence between those measures. Furthermore, we have eliminated the interest portion of repayments of lease liabilities from operating activities. As a result, the entire outflow of interest payments is now consolidated in a single line, providing a more streamlined view of interest-related cash flows. We've refined the reconciliation to create a more transparent depiction of free cash flow in relation to adjusted EBITDA. This change will help you to understand our financial performance and cash flow generation. Let me now summarize the key components. As already mentioned, CapEx for the period amounted to EUR 52 million. Tax payments as well amounted to EUR 52 million. Long-term incentive program payout, a one-off payment of EUR 14 million was made for the long-term incentive program, which was due after the IPO. This represents a one-off event and has been accounted for accordingly. IPO cost. The cost associated with the IPO were charged to the selling shareholders. Except for a small amount of EUR 2 million, this has already been paid. Other working capital showed a slightly negative impact. This effect is expected to reverse over the course of the year and has already eased compared to the first six months of 2023. Taking lease payments into account, the free cash flow after leasing for the first nine months amounted to EUR 174 million. To make this figure comparable and include all interest payments, adjusting for the one-off payout of the long-term incentive program, the adjusted comparable free cash flow would be EUR 117 million. Against the backdrop of the strong performance in the first nine months, we are able to firm up our outlook for this year. We are still targeting a total revenue growth of approximately 10% on a constant, constant currency basis. For the Web Presence & Productivity revenues, including Aftermarkets, we are now aiming for a growth rate of around 11%, increasing from 8%-10%. We expect our Web Presence & Productivity business, excluding Aftermarket, to continue to accelerate throughout the year as the impact of our growth investments come through and price adjustments done in 2022 will fully be kicking in. As anticipated and previously highlighted during the last earnings call, we are pleased to reaffirm the growth acceleration during the year, driven by continuous increase in service inventory through successful cross and upselling initiatives, along with price adjustments made in 2022. Both of this has notably taken effect. Based on the growth acceleration we have achieved in the first nine months, we are now expecting our Web Presence & Productivity business, excluding Aftermarket, to grow by around 6%-7% in full year 2023, excluding currency effects. Our expectation for Aftermarket growth, excluding currency effects, is around 20%-25%. While we continue to see robust demand from our SMB customer base, we acknowledge that the market for larger cloud customers has challenges, with ongoing delays in the decision-making process. This has resulted in projected contracts being concluded later, which at some point, in, which at some point means that we will not be able to compensate for the missing revenue to achieve our revenue target of 16%-20%. To get this right, there is no change in our confidence to capture growth opportunities in this space, and we remain committed to driving sustained growth as laid out in our midterm guidance. For the full year 2023, we expect Cloud Solutions revenue to grow around 14%-15%. The nine months results have surpassed our margin expectation, with the adjusted EBITDA margin standing at an impressive 28.9%. Therefore, we are able to increase our outlook and now expect the adjusted EBITDA to grow by around 13%, increasing from 10%, resulting in a margin target of around 27.5%, compared to at least 27%, which we were expecting before. However, it is essential to keep in mind that we plan to make performance and brand marketing investments in the high-demand fourth quarter, which will lead to a lower EBITDA margin in Q4. Investing in any brand is a long-term strategy that requires patience and persistence. It is therefore very encouraging that we are already seeing great success and increased brand awareness today. Let me reconfirm, brand marketing in future will stay at this year's level, which will just mechanically result in a decrease of marketing spending as a percentage of revenue, subsequently increasing our EBITDA margin moving forward. In the midterm, we remain focused on achieving an adjusted EBITDA margin above 30%. Lastly, based on the strong growth and profitability, as well as our fundamental strong cash conversion, we are targeting a net debt to adjusted EBITDA of below three, compared to 3.5 times adjusted EBITDA at the end of 2022. We are really confident to continue our growth journey, underpinned by our best-in-class financial profile, combining growth with profitability and cash generation. We have classified AI into three distinct areas that we are actively developing. Firstly, we are enhancing our product suites with AI features to directly benefit our customers. Our AI-driven text generator for MyWebsite simplifies content creation, and our AI-backed newsletter tool enables SMBs to effectively engage with their customers through email marketing, regardless of their experience or writing skills. In September, we launched our new AI website builder, which enables SMBs to create a full website using AI and comes with additional AI features to further improve the web presence. I will present this really cool product in a minute. Secondly, we are continuously enhancing our customer-facing products with AI capabilities to improve up- and cross-selling, as well as customer interaction. The first example is our new AI-based domain search at our brand, United Domains, which helps customer to find the most suitable domain for their needs. Lastly, we are leveraging AI as internal tools to enhance various aspects of our business operation. These tools support content creation, fraud detection, security, and even financial modeling. We have already introduced GitHub Copilot and an AI tool for product development and coding and various other AI tools to further boost our efficiency and productivity. We are very committed to pushing the boundaries of AI technology to improve our products and services continuously. Our dedication to innovation will remain at the forefront of our efforts as we strive to provide the best possible experience for our customers. Our enhanced MyWebsite product with AI assistance provides a comprehensive and unique AI-powered solution that allows our customers to create a website in seconds. To give you a sense of this fascinating product, which we released in September, we've created a video that I'd like to show you now. Ready to kickstart your online presence, but unsure where to begin? Get a perfect website in a few clicks with IONOS MyWebsite's AI. First, share some key details about your business, who you are, and what makes you unique. Next, choose the tone, style, and color palette that resonate with your vision. Then, let our AI work its magic, crafting a stunning website designed for a flawless user experience. Short on time? All results are carefully tailored to your needs and ready to go online. Just select your favorite design, and you're done. Want to edit the text? That's effortless. Use our AI to create additional content or improve what's already there, ensuring your message hits the right note every time. And what about changing an image? Our AI can help with that, too. Check out the gallery of suggestions or generate a brand-new visual to tell your site's story. With IONOS MyWebsite's AI, you're not just building a website, you're creating a digital experience that captures the essence of your business. Cool. On page 16, I would like to show you how we offer the new features. The AI website builder is already included in the starter tariff, as AI lowers the first hurdle for our customers, which is not to start with a blank sheet of paper, and we all know this. The obstacle is very high for many customers. The more advanced AI features are only included in the higher plans and should help to convert even more customers to the higher value plans in the medium term. The product has only been live for a few weeks, so it's a bit too early for details, but customer feedback has been really good, and the majority of customers already use AI compared to classic templates. We can already see as well that the quality of the website created has improved. For example, the quality of the content is better, with fewer standard phrases and therefore more unique. Also, the time the customers need to publish a website has decreased by around 30%, which is exactly what we are trying to achieve. With the enhancement of the MyWebsite product, we have also increased the prices for all plans by around EUR 3. The new prices apply to both new and existing customers, whereby the new pricing for existing customers will need some time to roll into the base, as it only applies with the next contract renewal. The AI features are not only great tools for our customers, but also increase the value of our customers. All right. Let me summarize the key highlights from today's presentation on page 15 that are essential to keep in mind. First and foremost, our business is built on a strong foundation, marked by sustainability and resilience. The majority of our revenues comes from recurring sources, providing a stable platform for consistent growth. Moreover, we just proved the predictability of our business model, with nine months results being fully in line with what we guided for. Looking ahead, we have a clear vision of our CapEx requirements for the upcoming years, thanks to the well-funded asset base we have in place, which also includes our thriving cloud solution business. The slowdown of the Aftermarket growth is fully anticipated and will dilute the adjusted EBITDA margin less in the future. In terms of brand investments, we expect them to reach their peak in 2023 and remain at this level. These investments will play a crucial role in supporting our revenue and margin expansion as we progress forward. A lot of the investments into the Cloud Solutions business have been made already, like investments for building up Infrastructure as a Service features, creating a great opportunity for future growth and EBITDA contribution. Our product portfolio has been successfully redesigned for cross and upselling opportunities and seamless expansion. In terms of AI integration, we are capitalizing on significant opportunities, both in our product suite and internal operations, promising a more efficient and improved customer experience. The strategic decisions we have made, coupled with the unwavering commitment of our team, will undoubtedly drive success and create value for all our stakeholders. Overall, we are very well positioned for future growth. Thank you very much. I'm now happy to take your questions. Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We will now take the first question. One moment, please. It's coming from the line of George Webb from Morgan Stanley. Please go ahead. Hi, morning, Britta. I've got a few questions to start with, please. Firstly, you talked, perhaps a little bit about a systematic review of pricing that you started in Q3. Can you add a little bit more detail on what that might entail or the work you're doing in that review? Secondly, on top line guidance for the year, the full year guidance on the Web Presence & Productivity segment, even at that upgraded 11% number, could imply a fairly sharp growth deceleration in Q4, which is something we're already modeling. But I guess a large part of that has to be driven by deceleration in Aftermarket growth in Q4. Is that just a factor of comparables, or is there anything seasonal or specific to Q4 we should be aware of? Then lastly, with regards to the AI website build enhancements, can you give any color today on what proportion of your customer base is using the website builder? Thank you. George, I had a little bit problems understanding you. We are now turning up the volume. Could you please repeat the first two questions? Yeah. So the first one was, you mentioned kind of systematic review of pricing that you started in Q3. Can you add a bit more detail on what that might entail or the work you're doing in the review? And then the second question was, on the top-line guidance for the year, the Web Presence & Productivity guidance of around 11%, would imply a deceleration in Q4, probably has to be largely driven by Aftermarket. So wondering if that's a comparables effect or if there's anything seasonal or specific to Q4 we should be thinking about? Yeah. So let me start with the first one. So in terms of price increases, we are carefully looking product line by product line and more or less customer cohort by customer cohort, and we'll drive it from there. So I already mentioned the adjustment which we made in our Website Builder, so this is how we tackle it product line by product line. Hope this helps to understand a little bit more. In terms of top-line guidance for the full year, yes, the deceleration is largely driven by Aftermarket. And then I think you had a question on how many customers are already using Website Builder. To be honest, I don't know from the top of my heart, but I think it's not. It's. We've started just a couple of weeks ago, so we are still monitoring the process. We do see good uptake rates, but nothing which already changed anything in our expectations, if that helps. And maybe coming back to the deceleration, if you look into Aftermarket in Q4 2022, that was a really strong growth. So the growth in Q4 this year will be driven by this high comp, slower. Understood. Thank you. Thank you. One moment, please. We will now take the next question. Please hold. The next question comes in the line of Toby Ogg from JP Morgan. Please go ahead. Toby Ogg from JP Morgan? Is your line muted? Okay, we will go to the next question. Next question is from the line of Andrew Lee from Goldman Sachs. Please go ahead. Yeah. Good morning, everyone. I just had some more questions around the price rises, new plans and thinking behind them. So it's useful the detail you've given on slide 14. Just had two questions. Firstly, what was the thinking behind, you know, introducing this well, quite a meaningful price rise across the customer base? What gave you the confidence that you could do that? And then second question was, could you just talk through the churn impacts you've seen so far, and how that is currently driving your thinking on the ability to do further price rises? Thank you. Yeah. As I pointed out, I think our brand is stronger than ever, and especially with the Website Builder, I think we have a very unique product. I'm not aware of any other of our competitors offering such a comprehensive product suite in order to build a website with a powered by AI. And we have tested a bit along and saw really good uptake rates and with the value. So it's not like we are just. We are not doing a flat price increase, but obviously offering more value to our customer. So this really gave us confidence in doing so. And keep in mind, this is only one of our products which we are offering. And in terms of churn, and this is what I said, we will take that step by step. So we will look how the customers react, how this is going through. At the moment, we do, the churn is efficient, active, effectively, sorry, below our expectations, so it's really going down well. But for sure, we are monitoring this very closely, and this is why we are not in the position at the moment to give you any update on the impact on our midterm guidance. Yeah. Thank you. Can I, can I just have a follow-up question, please? What, what is the phasing of the price rises then, if you're doing it over a protracted time period? When do, when do you expect to have completed those three-year price rises across that part of the customer base? So, they are already live now, but they will run through the pro for existing customers. They will run through the contract period. So they will only be effective as soon as the new contract period kicks in. So which should take, on average, 12 months to run through. Thank you. Thank you. We will now take the next question. From the line of Ben Rickett from New Street Research, please go ahead. Hi, thank you. I had two questions. Firstly, just to try and understand the impact of your extraordinary marketing spend. So in Q2 and Q3, you've pulled back that spend a lot, but in fact, your top line sort of web hosting revenue growth has been pretty strong. So it'd be interesting to understand what the dynamic is there. So when you spend more on the marketing spend, how do you see that feeding through into your results? And then second question, I know in the past you've done a lot of M&A transactions. I was just wondering what you think currently is the scope, from a leverage perspective to do further M&A transactions, and what you're sort of seeing in terms of valuations for companies at the moment. Thank you. Okay. Let me comment on marketing spend first. I think it's important to understand that new customers, if we acquire them through whichever marketing channel, usually have a 6 to 12 months discount. So the impact of a new customer in for the top line or for the top line growth is relatively muted between the first 6 to 12 months. So the impact is only kicking in if the starting discounts are running out. So every customer which we acquire now will have an impact in next year's top line results. So that's the nature of our business. But obviously, with good market conditions, so a little bit of competitive easing in the market, we are capitalizing on this both with our brand campaigns continuing to be broadcasted and as well, our performance marketing adjusting towards, as I said, CLTV over CAC. And then in terms of on M&A, so we always stated that we are not in the game of consolidating the market in terms of the smaller players which are out there in the market. We believe, given our stronger than ever brand and our very good performance, which we are currently delivering, as you have seen with the Q3 results, we can actually outperform those smaller players on the market. And this is what we actually see at the moment. So we are not focusing on small M&A transactions. If there's any larger M&A transaction, which we know is all opportunistic, we would definitely look at it. I think from a leverage perspective, we are delevering, and we are totally in our target of delivering roughly half a turn a year. So I think at one point in time, our leverage will as well give us enough flexibility to be ready, if needed. What level of, of leverage would that be, where you'd feel more comfortable to do M&A? That's a good question. I think it's pretty much depending as well on the market, but maybe if we come more towards a two or so. Okay, got it. Thank you. Thank you. We will now take the next question. From the line of Stephane Beyazian from ODDO BHF. Please go ahead. Yes, good morning. I've got three. The first one is on the Aftermarket. The revenues are still down quarter-on-quarter, and to be honest, I'm not super familiar with the seasonality in this business. And I think we're all modeling some growth in 2024, 2025. So, you know, any color you could have on when you think that the revenues—I mean, whether the revenues will continue to grow or are we touching a sort of plateau in that business? That'd be, I think, quite interesting. The second one is on cloud. You are adjusting your guidance there, and also the CapEx for this year looks to be a little bit perhaps lower than what you initially expected. So I'm just wondering whether this is just all a reflection of perhaps the slower momentum that you're having or a market slowdown, or perhaps you're also proactively willing to slow down your expectation and your ambitions in cloud. And the third one just to follow up on the pricing, can you comment a little bit on what the pricing moves you are seeing with competition? And whether you think we should perhaps factor a little bit of churn in our Q4 customer addition, or whether you think that all the marketing spending you're doing will offset perhaps any churn you could be seeing on your base. Thank you. Let me start with Aftermarket first. I think we always guided that the exceptional growth of Aftermarket, which we have seen in the last months and years, will be going down towards market growth, which is in the high single, low doubles. And this is a progression, so it's not falling off the cliff, but this is a progression. So we will—we are still expecting growth in Aftermarket for 2024 in line with that guidance. If we look into CapEx, that's—so and, and as well, Cloud Solutions revenue. So we are not proactively slowing down the business. We strongly believe in the opportunity the Cloud Solutions market is offering, but we do see and have to acknowledge that larger cloud customers are a bit hesitant in their decision-making. And in terms of CapEx, which is related partially to Cloud Solutions, that's one result of the slowdown in revenue, a little bit, which we are seeing there. And then it's a phasing issue and some shift in delivery times, et cetera. So, and then for the last one, in terms of churn, as I said, so, we do see some effects on churn and as well inflow from price adjustments. However, below our expectations and relatively moderate. So we are really confident that we will not see an uptake in our churn rate going forward. That's very clear. Thank you. Thank you, Stephan. Thank you. We will now take the next question from the line of Usman Ghazi from Berenberg. Please go ahead. Hi. Thank you for the opportunity. I've got three questions, please. On the price increases, I mean, are they coming in in the web presence business, in cloud or, you know, across the board? And also, are we talking about kind of CPI, kind of, linked type of price increases, or is this C- you know, more than CPI? And my second question was, you know, on the cloud business, so, you know, up until the nine months, you know, the growth has, you know, been around 16% if I look at it on an ex-FX kind of, basis. So the guidance downgrade for 14%-15% for the full year implies that, you know, Q4 is going to be around 10% or something. I mean, is this, does this just reflect, you know, a big contract you were expecting that's got deferred out into next year? So, you know, this is just a timing issue or, you know, would you expect the Q4 run rate for the cloud business to then persist through into 2024? Yeah. So I’ll keep it to those two. Yeah. Thank you. So let me start with price increase and the link to CPI. For sure, we had some increases and/or inflation, and we all know that across the board stuff increased. And of course, this implies as well to some of our products like energy, et cetera. And you know that we have been relatively reluctant in the past to pass this on to our customers, whereas some of our competitors have been really pushy and just introduced flat price increases of 10%-20%, sometimes through all products. Whereas we thought, let's see how the economic backdrop is developing, and let's work on offering up more value as well to our customers, and then looking into adjusting the prices. And then looking into the Q4 for Cloud Solutions, as I said, yes, we do see larger cloud customers being relatively reluctant and slow in decision-making. So yes, we did expect some more of those contracts or customers coming in or projects coming in, which we believe are shifted into 2024 now. So this is one of the reasons why we are slightly slower in this year's expectation. All right. Thank you. Thank you. We will now take the next question from the line of Nizla Naizer from Deutsche Bank. Please go ahead. Thanks. I have three questions from my end as well. The first is on, you know, pricing of the new AI-driven products going forward. What would be sort of the incremental drop through to EBITDA? In the sense, what's the cost to IONOS to provide these sort of AI-linked products? Because I'm sure you have your AI partners that you're paying as well. So some color on maybe the underlying economics of your cost versus the revenue that you could potentially generate would be great. The second is on the shareholder loans. You've paid another EUR 35 million in October. Would there be plans to sort of pay more over the rest of the 2023 year? Or would this then again be, okay, what could you do in 2024 in terms of paying it down, and lowering the leverage? S ome color there would be great. And my last question is on cloud. So there seems to be, like you said, a delay with these large projects going into 2024. Are you still sort of comfortable with the 20% type of growth that cloud was expected to do over the midterm? So could 2024 go back to a 20% type of growth year? Is it too early to tell, or is it fair to assume maybe more mid-teens again before an acceleration beyond 2024? So some color there would be great. Thank you. So in terms of the AI feature, this is actually a pretty high-margin product. So the incremental cost which we have for providing this feature are relatively low. And so it's relatively, as I said, it's a pretty high-margin product. And then looking into the shareholder loan, as I pointed out, we still intend to spend on marketing because it's a high-demand quarter in Q4. So there might not be another repayment in 2023. But obviously, if there's excess cash, we will repay, but this is currently not planned. And then in looking into 2024, so we expect at least the same level of repayment that we have in 2023. And depending on the results, it should be a notch more than that. And then in terms of Cloud Solutions, we are really confident about the midterm growth of 20%. For 2024, it's a bit too early to tell. Thank you. Thank you. We will now take the next question. From the line of Emily Johnson from Barclays, please go ahead. Morning. My first question is, can you comment on the underlying health of SMB creation and reductions in Germany and the U.K.? You're clearly growing active customers overall, but I'm interested in any color you have on what the underlying market is doing in terms of the volume of SMBs and where you think you're gaining share. My second question is on the 16% growth in cloud in Q3. How much of that is like for like revenue growth with existing customers versus signing new contracts? And then my last question is on marketing spending. Can you remind us what the competitive landscape is like in Europe? In previous quarters, you spoke about CAC coming down and that helping the absolute amount that you needed to spend on marketing. It sounds like you're now referring to shifting the mix of performance versus brand marketing. Can you just confirm whether this is a continuation of previous trends of lower CAC leading to lower absolute performance marketing spending, or whether there's any change in strategy there? Thanks. Let me start with the first question. So in terms of of marketing spending, we are always adjusting to the market conditions. And if we see performance marketing being really very efficient and effective, we will try to put a little bit more in there, depending as well on incoming revenues, et cetera. But I wouldn't say we are, in general, shifting away from brand towards performance. We are really committed in driving our brand awareness. But still, I think what we always said in the past, that the market is easing down a bit in terms of competition when it comes to marketing. That still holds true, at the moment as well, and we are now running into the very high demand fourth quarter. So we are still expecting that we can lower our CAC. And then, in terms of SMB and the economic backdrop for SMBs, so we do not recognize a stronger trend of SMBs going out of the market or belly up. We do see a move back towards pre-COVID levels, but nothing which really worries us. So we would still expect that the SMB market, so the number of SMBs, is growing, as we have seen in economic downturns in the past. So usually, you see an uptake in SMBs. This market is really resilient. So for the 16% growth in cloud, I think it's a good mix between new customers and as well, them taking more and as well. So it's a good mix. Sorry. It's a good mix of new customers, but as well, our existing customers consuming more. So it's a good balance between both. Thank you. I hope that's fine. Hello? Yes, we will now take the next question. One moment, please. From the line of Toby Ogg from JP Morgan. Please go ahead. Toby Ogg from JP Morgan? We will go to the next question. Coming from the- Ah! One moment, please. Okay. Sorry. Sorry about- We couldn't hear anything here. So sorry. Sorry. Next question from the line of Usman Ghazi from Berenberg. Please go ahead. Hello, thank you for the opportunity again. Two follow-ups, please. Could you perhaps, you know, give some qualitative commentary around the revenue growth you're seeing by country? So, you know, because I remember that a quarter or two ago, we got specifically called out Spain and Poland as markets that were seeing subdued trends, one because of COVID normalization, the other because of the war in Ukraine. So, yeah, just, you know, broader kind of commentary around, you know, just the strongest and slash weakest markets would be interesting. And then just on the AI slide, I guess most of the features you rolled out are already in web presence, right? I mean, could you perhaps talk about, you know, what you're looking at in terms of, you know, rolling out AI features in the cloud segment? Thank you. So I think the commentary around Poland still holds true, so it wasn't a one-time effect. But we see them continuing to come back to a good growth rate. And we do see as well that Germany is growing relatively well. And our business in the Netherlands, which is relatively small, but it's STRATO, which is present in the Netherlands, but it's growing very well. Everything else is more or less in the same ballpark. And we will continue to. And we expect basically all countries to grow more or less the same. And then in terms of your second question, could you please repeat, Usman? Thank you. Yeah. Sure. So the AI features that you've rolled out so far seem to be primarily focused on the web presence segment. And I'm just wondering if you could maybe elaborate on what you're doing on the cloud side, in terms of rolling out, you know, AI. Yeah. So we- Thank you. Yeah, we are actually, we are—you are absolutely right. We are in terms of features for AI, we are focusing on Web Presence & Productivity because we believe at the moment this is where the SMBs can benefit the most from those features, like building the website, et cetera. And then, and we will then continue to look into the product roadmap as well for Cloud Solutions. Okay. Thank you. Thank you. We will now take the next question. From the line of Daria-Ioana Sipos from JP Morgan, please go ahead. Hi. Thank you for taking my question. Just on the Web Presence & Productivity ex Aftermarket segment, you saw a 7.5% growth, excluding FX in the quarter. Could you give us a sense for how things progressed through the quarter, month-over-month? How are the September rates looking versus July and August? And then just thinking about some of the trends you've been seeing in October and November, how have these looked in relation to developments towards the end of the Q3? Thank you. Yeah. So I think overall, the Web Presence & Productivity business has not that much seasonality in terms of month-over-month. You should see it continuously growing. I think there's one exception, and this is relating to the domains business, which is usually a bit stronger in the first half. But other than that, I wouldn't see a lot of seasonality in the Web Presence & P roductivity business. I hope this helps. Great. Thank you. Thank you. I would like to turn the conference back to Stephan Gramkow for closing remarks. Thank you, operator, and thank you everyone for attending today's call. Please don't hesitate to get in touch for any follow-up questions. Have a nice day, stay safe, and goodbye. Thanks, everybody, for joining. That concludes the conference for today. Thank you for participating. You may now disconnect.