Good day and thank you for standing by. Welcome to the Ubisoft Full Year 2021-2022 earnings 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. To ask a question during the session, you will need to press star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to our speaker today, Yves Guillemot. Please go ahead. Welcome everyone, and thank you for joining the call today. Before we dive into today's announcement, my first thoughts go to our more than 1,000 Ukrainian team members. I want to reiterate our unwavering solidarity, and we will keep on doing everything in our power to support our colleagues as they go through those extremely difficult times. Let's now turn to today's communication. The past 2 years have been intense for Ubisoft and the industry. During those demanding times, our teams have showcased amazing resilience. As an organization, we have demonstrated that we can rely on dependable brands, production, and technology assets which are stronger than ever at a time when the value of assets has never been so high. In the context of meaningful challenges, notably the adaptation to new hybrid production models, we have delivered this year on key strategic priorities. Namely, growing our major brands, building an increasingly recurring business, and implementing profound transformation to our organization. This transformation is intended to both capture the many great opportunities our fast-evolving industry has to offer and build a more inclusive workplace. We have appointed new leaders across the company and evolved our capital allocation decision-making process. We have also expanded our executive committee and continued to build the best-in-class governance. We welcomed back last year more than 600 talents, reflecting our continued strong attraction as a great place to work. We have also made significant additions to our teams in the recent months, from industry-leading producers and creators to highly recognized experts in artificial intelligence and programming. We have increased the women's share of total workforce, and we have ambitious plans to continue growing that share. We are now entering a new multi-year phase of significant top-line growth, spurred by the major progression of our investments over the past years and what is the biggest pipeline in the company history. We have ambitious plans to grow our biggest franchises with notably four promising mobile games under development, and to expand our overall portfolio with new IPs and massive entertainment license partners. We are diversifying our operations through more business models, more platforms, and we are continuing to grow our recurring profile. As a consequence, we expect a significant progression of our operating income starting in fiscal year 2024. The last comment before I let Frédéric detail our full year performance. There has been a lot of talks around consolidation in the industry and in Ubisoft in particular. Our overall position is clear and well-known. As we said last February, we have everything we need to remain independent. We have the talent, the industrial and the financial scale, and a large portfolio of powerful IPs to create massive value in the coming years. This has provided us with the clout to build strategic partnerships with the biggest players in the entertainment and tech. The current speculation is putting in plain sight the real appeal and value of our assets and of our value creation potential. As mentioned before, as a public-listed company, it is standard and best practice for our board to review any offer in the interest of all shareholders and of our great teams. We will not make further comments on this topic or remarks. I will now let Frédéric detail our full year performance. Frédéric. Thank you, Yves, and hello, everybody. Considering the challenging environment Yves mentioned, we have been able to deliver a solid performance in fiscal 2022. It has been built on our three biggest brands, each delivering well over EUR 300 million on our strong live services, on the depth and strength of our portfolio, as well as on our continuously increased capacity to value our brands through high-value partnerships. We reached 132 million active unique users in the fiscal year, down 7% year-over-year. Daily active users stood at 37 million, down 9% versus the record levels registered last year, which notably reflected the impact of lockdown on total engagement, as well as the user acquisition from Hyper Scape. Versus two years ago, active unique users and average daily active users were up respectively 12% and 9%. In an exceptionally high competitive environment, Q4 net bookings reached EUR 664 million, very strongly up 37% year-on-year on the back of Rainbow Six Extraction, Assassin's Creed Valhalla: Dawn of Ragnarök, and the Assassin's Creed The Ezio Collection remasters. Content on live games, as well as two DLCs being released on Far Cry 6. Fiscal 2022 net bookings reached EUR 2.1 billion, down 5% year-on-year. Back catalog was up 11% year-on-year and up 29% versus fiscal 2020, cementing the increasing year recurring profile of our business and represented 67% of our total net bookings. The solid back catalog performance reflects the significant value that lies in our deep and well-diversified venture franchises. As I just said, our three largest brands each generated well over EUR 300 million of net bookings and grew versus their respective comparable base. Assassin's Creed net bookings nearly doubled versus fiscal 2020, the prior release-free year, on the back of a stellar Assassin's Creed Valhalla performance, fueled by a strong post-launch program, which continued to see year-over-year growth in unique active players. Valhalla reinforced its position as the second largest profit-generating game in Ubisoft history. To be noted, the remarkable performance of the other Assassin's Creed games, in particular Odyssey. Far Cry had its best year ever, spurred by a very solid back catalog performance and of course, the release of Far Cry 6, which players deeply enjoyed with a strong post-launch plan. To be noted that Far Cry 6 first three weekends brought in a franchise record-breaking 1 million new players. Overall, the game posted very strong growth in play time and PRI per player versus Far Cry 5. Rainbow Six saw net bookings growth on the back of the brand expansion with the release of Rainbow Six Extraction. Rainbow Six Siege Year Seven, Season One received very positive reception thanks to the introduction of significant content, including a new operator, a new permanent game mode, Team Deathmatch, to ease onboarding, and the first new map in three years. In fact, the week of the Season One release was the game's 50 best week of additional content and bookings ever. Overall, the Rainbow Six Siege acquisition of players grew nicely in Q4 versus the previous quarter. The team has a ton of exciting content planned throughout the year. Elsewhere in Ubisoft catalog of games, Valhalla and For Honor continued on their very strong trends and posted both unique active user and booking growth, while Mario + Rabbids Kingdom Battle confirmed to be an evergreen title. Total digital net bookings reached EUR 1.7 billion, up 4% year-on-year and represented 78% of our total net bookings. PRI stood at EUR 813 million, up 4% and represented 38% of our total net bookings. Mobile amounted to EUR 188 million. Let me now go into the details of our full year earnings. Starting on slide 6 in our PNL. Gross margins stood at 87.3%, up nearly two percentage points, mostly reflecting the progression of digital bookings. SG&A were up 2%, reflecting lower marketing expenses that were more than compensated by higher investments in IT services and hosting as we are preparing for upcoming significant top-line growth that will be for our direct-to-player and Live 3D businesses. Non-IFRS operating income stood at EUR 408 million, slightly below the low end of the target range. As we have said today, this reflects an exceptionally competitive environment during the last quarter. As usual, please refer to our press release or presentation appendix for the full IFRS to non-IFRS reconciliation. Turning now to slide 7. PNL R&D was broadly stable year-on-year and stood at EUR 783 million. Total cash R&D was up 8% year-on-year, decelerating as expected versus the average 17% per annum between fiscal 2019 and fiscal 2020. Cash R&D is now up 14.3% CAGR since fiscal 2019, broadly in line with our stated objective. It reflects our biggest pipeline of products ever to support our upcoming multi-year significant top-line growth. Looking at our cash flow statement on slide 8. Free cash flow stood at EUR -282 million versus EUR 72 million in fiscal 2021. This mostly reflects the following impacts. First and foremost, the EUR 241 million unfavorable move in changing working capital requirements. Second, the EUR 120 million decrease in cash flow from operations driven by the decrease in net income and the increased gap between cash and PNL R&D. Of note, we bought back 3.2 million shares for a total amount of EUR 167 million in calendar year 2021, of which around EUR 150 million were bought back in fiscal 2022. Non-IFRS net debt stood at EUR 283 million, and available cash amounts to nearly EUR 1.5 billion. Today, we introduced our guidance for fiscal 2023. We expect significant top-line growth and EBIT at approximately EUR 400 million. Fiscal 2023 will be marked by a powerful lineup, with the majority of our top-line growth coming from the premium side. Avatar: Frontiers of Pandora will leverage the power of our Snowdrop engine to deliver a beautiful rendering of the world of Pandora and an experience true to the amazing universe created by James Cameron. Mario + Rabbids Sparks of Hope will build on the success of Mario + Rabbids Kingdom Battle by broadening the scope of the game and leverage the long-term partnership with Nintendo, as well as the massive Switch install base that is now over 100 million units. We kicked off in March the Skull and Bones insider program, and we can't wait for a larger audience to put their hands on the game that brings a unique pirate fantasy coupled with a beautiful Indian Ocean setting and a deep social and multiplayer experience. As we have already mentioned, there is also exciting content to come on the premium side for this fiscal year. On the free-to-play side, we continue to progress in our different testing phases, where Roller Champions has gone gold and will be released this quarter. XDefiant, The Division Heartland, Rainbow Six Mobile, and The Division Resurgence are all on the way. Some of these games are in their final stages of test and development and are set to be released in fiscal 2023. Regarding Ghost Recon Frontline, we have taken the player feedback during the test phase that took place earlier this year, and the team is committed to take the required time to create an experience that fans the Ghost Recon franchise will love. Overall, our free-to-play lineup is promising, and while we have set overall fair expectations, we expect it will be a meaningful driver of top line and PRI progression in fiscal 2023. On the cost side, this year's cost structure is not only being impacted by a mix more biased towards new releases versus back catalog, including new brands launches, ramp-up in the free-to-play segment, and by the fact that games on mobile and Switch carry lower cost margins. In terms of cash R&D, as we are getting closer to the needed scale to deliver significant top line growth for the foreseeable future, and after six years of strong headcount growth, we expect fiscal 2023 to be the final year of meaningful cash R&D growth. Beyond that year, it will continue to grow, but at a much smaller pace. We expect to generate a positive cash flow for our operations in fiscal 2023, as the gap between PNL and cash R&D is expected to narrow. I will now mention a few fiscal 2023 housekeeping items for modeling purposes. The stock-based compensation is expected at around EUR 35 million. The non-IFRS net financial charge is expected at around EUR 18 million. The non-IFRS tax rate is expected at between 30% and 35%. The number of diluted shares is expected at around 128 million shares. Looking at Q1, we expect net bookings of approximately EUR 280 million, reflecting general prudence. As a reminder, last year's Q1 saw the release of the highly successful Wrath of the Druids DLC from Assassin's Creed Mirage, and the related meaningful deferred revenue from the prior year season pass. Finally, as you said, we have been building the biggest pipeline of games in Ubisoft history. Our goal is to massively grow our audience and build an increasingly recurring business. We have many titles in development for all our biggest franchises, new promising brands, all this across platforms and business models, notably for mobile. We are also creating games based on the biggest entertainment licensed brands. We have been investing in exciting new technologies that can deliver meaningful breakthroughs in the mid to long term. These are promising and powerful assets that will generate significant growth for the coming years. We are now ready to take your questions. Thank you. We will now begin the question-and-answer session. As a reminder, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press the hash key. Once again, please press star one if you wish to ask a question. The first question comes from the line of Omar Sheikh from Morgan Stanley. Please go ahead. Hi there, everyone. I've got a couple of questions, maybe do them one at a time. Maybe first off for Frédéric, could I just ask about the guidance for 2023? Could you maybe first of all quantify what you mean on top line growth? Are we talking high single-digit, low double-digit? Some sort of color on that would be helpful. Then, how should we think about essentially the margin progression that you're guiding to in 2023 versus where you think it will get to longer term? If you could just discuss the margin in 2023, essentially the split between the core triple-A margin, the premium game margin, and free-to-play mobile investment, and where you ultimately think EBIT margins might be able to get to over the next few years. I will have a follow-up. Thanks. Yes, hello, Omar. Yes, in terms of the guidance for the top line, we expect high double-digit top line growth. In terms of the margin progression in fiscal 2023, yes, as we've been saying, we are positioning the company to go after a much stronger recurring profile for the future years. That's why in fiscal 2023 we are investing into positioning our free-to-play games, including mobile, to get to a much bigger audience as well as more recurring revenues. We are coming with new IPs, and that's of course sets us up to go for meaningful, significant growth in the in terms of top line for the coming years, starting in fiscal 2023. On the back of this, strong and significant top line growth in the coming years, we expect operating income to grow meaningfully and, we should expect, operating margin to grow over time. Sorry, just to follow up on that, Frédéric. In the past you've said that core, I guess, triple A or premium game margin is in the region of 25% at the EBIT level. Is that still the case? Yeah, last year it was indeed north of 25%. We had said that we won't comment on this metric every year, but we continue benefiting from a strong operating margin on the premium side. Okay, great. Then just maybe a follow-up then for Yves. Yves, I wondered, you know, you don't want to comment on consolidation in the industry or speculation, but, you know, your share price has been pretty weak over the last 2-3 years, largely because the progression in profits, free cash flow, and margins has been, you know, fairly disappointing, certainly for 3 years in a row now. How do you think about timing the recovery that you're now seeing in 2024? If you see further investments that might pay off longer term, would you anticipate pushing a profit recovery further out? Or do you think it's now important to start delivering profit and free cash flow growth from next year? Thanks. Yeah. Thank you for the question. Yes, our goal is really to come with all the efforts we've made to create a large portfolio of games, starting in financial year 2024 with, you know, a good growth and a good profitability. We are doing everything to make sure all those games plus the back catalog will generate more profit and more cash flow. Our plan is also to reduce investments starting next year. Would you say it's a priority for you to deliver strong growth in profit and free cash flow in 2023, 2024? Or do you think it's still possible that you could push it back another year? What we're saying is that we go for a significant top line growth in the coming years, and that will translate into a significant growth in operating income in fiscal 2024 and beyond. That means that the core of the operating income in the next years will come from this top line growth. Of course, we should expect profitability improvements on the basis of around 20% we've seen over the last years. We plan to be positive from a cash flow operation in fiscal 2023. We will still see a meaningful growth in R&D this year, in fiscal 2023, but that, as we've seen, we've been decelerating R&D this year. As Yves said, fiscal 2023 will be the last year of true growth in R&D as we will decelerate R&D growth in fiscal 2024. That of course will translate to cash flow generation on the back of this strong top-line growth moving forward. Okay. Thank you very much. We plan. You're welcome. To have also more mobile games also in 2024 as well. Thank you. Thank you. Next question comes from the line of Nicolas Langlet from BNP Paribas Exane. Please go ahead. Yes. Hello, everyone. I've got three questions. The first one on the mobile games that you announced, Rainbow Six Mobile recently. Is it the game developed in collaboration with Tencent you were referring in previous calls? Or there is another advanced mobile project with Tencent that could be announced in the coming quarters? Second question on Rainbow Six Siege. If we exclude R6 Extraction, was the franchise growing in full year 2022? You mentioned in previous calls a big plan to reinvigorate the engagement on Rainbow Six Siege. Can you update on those key initiatives and what impact you expect? Basically, do you expect R6 Siege to grow in full year 2023? Finally, on the blockchain initiatives. You made those, this initiative on Ghost Recon Breakpoint at the end of last year. What are the main learning from that test? Are you confident on the blockchain gaming compared to six months ago? Should we expect other initiative with existing franchises this year? Thank you. Yeah. Hello, Nicolas. Yes, you're right. We recently unveiled Rainbow Six Mobile that will be a high quality technical shooter game coming on the mobile platform. That's a very exciting project that is being developed by the Montreal studio that is the creator of Rainbow Six Siege. The experience will be very true to the Rainbow Six Siege experience with key elements including destructible environments notably, but with specific adaptation, of course, to the mobile platform. Separately, we have games being developed in partnership with Tencent. As for the question on Rainbow Six, yes, Rainbow Six grew as a franchise in fiscal 2022. Extraction was the key driver to get there. As we had said back in February, we exceeded more than 5 million players on Extraction with a significant number coming from returning players from Siege. At the same time, in the quarter, we've seen an increase in acquisition of new players for Rainbow Six Siege. The overall franchise has been growing nicely in Q4. In terms of what we have in our plans for Rainbow Six Siege, as you know, we recently announced Year 7. That will be the biggest year of content program and features delivery since launch. We are coming back with what made the success of Rainbow Six Siege, which is a combination of new maps for the first time in three years and new operators, so bringing even more variety and diversity to the gameplay, on top of a key focus to improve onboarding to boost even more acquisition and addressing the toxicity topic. We've seen that the reception from this Year 7 was very strong, and we've been reaching record CCU levels in March. As for blockchain gaming, as we've been saying, we've been investing in a number of future technologies, including cloud computing, voxel, and Web3, and that's part of the DNA of the company to prepare to learn, iterate, explore before expanding. We believe that these different key technologies will allow us to deliver very meaningful and value proposition for players with more persistence, more spectacular, deeper social experiences, and allowing players to express themselves in different manners. Okay. Okay, thank you. Thank you. Next question comes from the line of Ken Rumph from Jefferies. Please go ahead. Good evening. Could I begin just with a check on your wording about the meaning of significant net booking growth? You said, I think, high double digits. I presume you meant double digits rather than high single digits. Is that correct? Hello, Ken. I said high double digits. That means 99% in my English. You mean high teens or something like that? It's clearly lower than a low double-digit number. It will be a significant growth and the magnitude of this growth will be, of course, a function of the mix between premium and free-to-play games. Okay, great. Could I then ask? Could you give us any sense of scheduling either of the premium titles? I guess we all expect Avatar to come out alongside the movie, but any sense about Mario and Rabbids and about Skull and Bones? Perhaps more easily, I guess there are now five known kind of high-definition, free-to-play projects. You know, there's Heartland, Roller Champions, XDefiant, Frontline, Project Q, or whatever it's called. Did you say Heartland was definitely coming this year? Equally on mobile, I think, did you say, you know, four projects? I think obviously Rainbow is launching, but did you mention the Division mobile game also? Just to try and get a sense of how much we should expect this year. My final question, if I may, was you referred to a kind of evolved structural process for capital allocation. Could you explain a little bit what you mean by that or why it needed to change? Thank you very much. Yeah. In terms of the timing for games to be released this year, we have Roller Champions being released this Q1, and the other games are planned to be released in the H2 of the fiscal year. In terms of the free-to-play games, we didn't mention the ones that will be launched this fiscal year beyond Roller Champions. They are all progressing well, and we expect that we will have several free-to-play being launched this year across all platforms. In terms of the mention we made to relative to allocation, capital allocation, what we are looking at, and it's been a process that we've been following over the last two years, is, of course, to make sure we continue adapting ourselves to the fast evolution of the gaming market. What we are focusing on right now is three areas mainly. We invest even more into our biggest IPs across all platforms. We've been very happy to see our biggest brands exceeding well over several million EUR. We will bring them to new levels in the coming years and bring other core IPs also beyond these levels. The second area is really that we are going after more recurring revenue generators that really translate into more social experience, going after long-term retention types of game, and of course, free-to-play with multiplayer is part of this focus. The third element of focus is to develop and further support our core cutting-edge technologies. Okay. That's great. Thanks very much. Thank you. Next question comes to the line of Charles-Louis Scotti from Kepler Cheuvreux. Please go ahead. Yes. Good evening. I've got three questions. The first one on the premium games. You said that you will release exciting titles. Can you be more explicit on this topic and especially whether or not it is going to be triple-A games? Second question, there is no mention of any Assassin's Creed content for the fiscal year 2020 to 2023. This will be a two-year gap in the Assassin's Creed franchise, first in history. Can you tell what are the reasons that would explain this gap? My third question on free-to-play, you said that the contribution should mostly come from existing IPs, whereas Roller Champions will be released in Q1. Should we understand that you have factored in very conservative assumption on the game, and if yes, why? Thank you. Yes, we indeed said that we'll have other premium games to be released in the latter. That will be stronger premium games, but we will come back to our fans and peers at a later stage. In terms of Assassin's Creed, what we said before, that we'll come every year with meaningful paid content of very high quality. As we mentioned, we're benefiting from an amazing performance from the overall franchise and thanks to Valhalla that has become a true live service type of brand with a much higher level of recurring revenue than before, but also other Assassin's Creed game thanks to Odyssey continuously doing very well. In terms of the free-to-play, you're right. Our focus is to bring our biggest IPs to free-to-play and fiscal 2023 we'll see the benefit of that. Roller Champions will be a good strong game coming in Q4. Yes, it's a new IP coming with 3 versus 3 competitive multiplayer experience. That's the good illustration of our continuous move towards competitive multiplayer game. Sorry, you said Q1. The game is due to come in Q1 or Q3? Q1. Okay. Okay, thank you very much. Yeah. Thank you. Next question comes from the line from Matthew Walker from Credit Suisse. Please go ahead. Thanks a lot. Thanks for taking the questions. I've just got two questions, please. The first one is, you know, when the board has looked at the business plans over the last few years, how much scrutiny are they putting on the plans and the achievement of guidance? Because obviously guidance has been missed for the last few years. I'm just wondering, can you just explain the process whereby you present to the board and what kind of scrutiny they are putting on these plans on behalf of shareholders? The second question is on Skull and Bones and Avatar. Obviously both of these are new titles. They don't have an existing player base. So I was just thinking, you know, what is your level of confidence in the results from Skull and Bones and Avatar? How are you gonna make sure that they find an audience? Have you, in your guidance, baked anything in for, you know, a weak macroeconomic environment? Thank you. On Avatar and Skull and Bones, we have two very interesting titles. Avatar is coming on the movie that will be, we expect, one of the biggest movie of the year or probably of the next few years. We are confident that it's going to really be a big title. On Skull and Bones, we have been working quite hard on that product, so it's going to really bring something fresh to the market that will, we expect, bring lots of recurrency in the long term so that it can generate revenue for the company, over time. Thank you. Next question. Now on the board aspect, we present what we expect to do at the beginning of each year. It is approved by the board. They check all the games and how we can achieve those numbers. What has happened in the last few years is the fact that some games are because of the pandemic and also having the work from home included really it pushed some products out of the year, and that was something that was difficult to anticipate. The other key element here is that the board is constantly looking at what the assets and the asset value that the company has been creating and the board understand that we are taking the right time to transform the company to go for higher recurring revenue generators. It takes time, but the fact that we're bringing our biggest IPs across all platforms to make them even more accessible on mobile into both the world geographies is a major strategic shift that the board is supporting. Okay. Thank you, guys. I want to come back to a comment just to clarify and get back to Ken's question. When we're talking about significant top line growth, to be more precise, we're talking about the top line growth that will exceed 20% in fiscal 2023. Thank you. Next question comes from the line of Tom Singlehurst from Citi. Please go ahead. Good afternoon. Thank you very much for taking the questions. One thing that would be really helpful, and I know you've talked around this, but maybe just to give us a sort of an absolute number, on the scale of the investment, in particular in some of the new free-to-play premium free-to-play titles. I mean, I know this is our problem, not yours, but you know, on the sell side, we're all looking for around EUR 480 million of operating profit. You're talking about EUR 400 million. I'm just trying to work out whether there's, in your mind, you know, EUR 80+ million of incremental investment going in or were we just too optimistic on the margin and, you know, the lower guidance is a function of just more muted profitability more broadly before that pickup in 2024. That's the first question. I've got a follow-up in a second, if that's okay. In terms of, as we said, we've been spending 20% of our R&D into free-to-play titles, with the majority of this investment being done on our biggest IPs across all platforms. What we consider that, of course, fiscal 2023 being the first meaningful year of launch will come with investment. What is important to have in mind for fiscal 2023 in terms of profit evolution, as I said earlier, it reflects the fact that we are launching new IPs, as well as free-to-play. As we are launching games also on the mobile and the Switch, they are usually coming with a lower gross margin. Got it. Perfect. The follow-up, I'm sort of conscious that you're not gonna talk about, you know, any specific scenario. I mean, you know, you said earlier in the call that you've done enough, I think, you expect to remain sort of independent. I suppose the question is, you know, I mean, what are the benefits in your mind of being independent as opposed to, you know, operating in private markets? Maybe you could give us some insights on that. Yeah, as we said, we won't comment on the overall topic, but what we can say is that over the last 25 years, Ubisoft has been a publicly listed company, and we've been able to create a massive value while maintaining a strong focus on the long-term value creation model. Perfect. Very clear. Thank you very much. Thank you. Next question comes from the line from Doug Creutz from Cowen. Please go ahead. Yeah. You mentioned the competitive market in the March quarter, and it was sort of historically dense with releases. Can you talk a little bit about how in your March quarter results you think the competition affected your performance versus, you know, maybe return to work, things like that? Kinda, you know, slice apart where some of your things didn't meet your expectations and what the causes were. Thanks. Yes. What we've seen indeed in this quarter is that there was intense level of competition. In this context, as you can see, we've been delivering very strong growth of 37%. Actually, the back catalog grew 83%, so that shows the strength and depth of our catalog of brands actually. Assassin's Creed Valhalla again a remarkable quarter. It's impressive, actually, its position as a second biggest profit unit of the company. We also were able to launch a Ubisoft collection on Switch to broaden the audience on a more mainstream platform. As we said, the launch of Extraction allowed the Rainbow Six franchise to significantly grow. All right. Thank you. Thank you. Next question comes from the line of Nick Dempsey from Barclays. Please go ahead. I've got three questions left, please. Just the first one, zooming in on the Q1 guidance, guiding to down 14% year-over-year in Q1 2023 versus Q1 2022. I understand that you had some benefit from Valhalla, more benefit from Valhalla back in Q1 2022, maybe some good engagement with live services games. At the same time, FX moved quite a lot in your favor in that period. Can you give us a bit more color on the differences between Q1 2022 and Q1 2023? Because I think investors will be looking at how much that implies for the rest of the year in terms of growth to do your full year guidance. Second question. We just talked about the competitive environment in the last quarter. There's a lot of content being developed across the industry currently. Do you have confidence that you won't have further quarters that are perhaps surprisingly competitive, in the next few, which might dent your hopes a little bit on delivery? Last question, maybe just on cash R&D growth. Last year of meaningful growth was the phrase you used, another double digit year or single digit, or can you give us a little bit more help on that? Thank you, Nick. On the Q1 last year, as I said, we had the delivery of a big DLC, Wrath of the Druids. That was the first one on Valhalla, but also, and especially that triggered the recognition in terms of net booking of the part or big part of the season pass. That's why the comps basis for Q1 last year was high from that point of view. In terms of the competitive environment, it's actually interesting to see that paid content has done well in the industry over the last quarter. On our side, we're coming with high quality games that have strong positioning, unique positioning in what we're bringing in fiscal 2023. Also with the objective, as we know, to diversify our offering across all platforms, and to go after all geographies which we had not done before. We are diversifying the way we go to market. On the significant growth, you should expect that the growth should come from new releases. The majority of this significant growth will come from premium launches, but we should expect a meaningful contribution to that growth from our free-to-play launches. In terms of R&D cash growth, what we're saying is that we've been decelerating this year. We will have still a meaningful growth in fiscal 2023, but that will be the last year of meaningful growth as we will be stabilizing headcounts over the fiscal 2024. You can't help me out with what meaningful growth might be between 5% and 15%, or? What we're saying is that we had planned for medium-term 15% growth in terms of R&D since fiscal 2019. Since fiscal 2020 and 2021, we've been decelerating. That's what you can anticipate. Okay, thank you. Thank you. Next question comes from the line of Jamie Bass from Berenberg. Please go ahead. Hello, guys. Thank you. I've got three questions as well, if that's all right. First. I mean, they're quite similar to a couple of the previous ones, but, on the cash R&D side, so I guess we can't have, necessarily an exact idea of how much it's gonna grow this year, but could you give an idea of whether, we're gonna have a similar level or proportion of capitalization as we've seen in the past few years? Or is there gonna be, a shift towards, more of that R&D being in the PNL as these games start to come out? Second question, again, this is quite similar to Nick's, but, you know, if we look at the Q1 outlook for next year, that's below almost every quarter for the last two years, just on the back catalog. What assumptions are you making about how aggressively the back catalog net bookings will drop off? Does that mean you're on the conservative side to Roller Champions here as well and other revenues? Finally, you know, you've got quite a lot of content in the pipeline in terms of free to play and mobile. How are you thinking about the gaps that you would need between these to make sure you're not cannibalizing potential players? Thank you. Yes, thank you. In terms of the gap in terms of cash R&D versus cash PNL, it will significantly narrow in fiscal 2023 versus fiscal 2022. In terms of the Q1, as we said, we are taking general prudence as we start the year. As Roller Champions will be our first launch, we're taking a conservative stance. On the content in pipeline, what we've been working on is to make sure that our free-to-play experiences will be very well differentiated. What we've seen from the past of other premium brands going free to play next to premium, we've seen a very strong organic growth in the emerging market. Actually, overall, payer engagement growth in the mature markets. That's the template that we are looking for for our free-to-play launches next to premium. Great. Thank you. You're welcome. Thank you. Next question comes from the line of Emmanuel Matot from Oddo. Please go ahead. Good afternoon. Thank you for taking my questions. First, what about your employee turnover? What is the current rate compared to the historical average? To what level do you increase wages to retain talents and attract new ones? Can you take also advantage of the mergers between some of your competitors in the sector? And second, could you update us on your partnership with Tencent? Where are you and what are the next phases? Do you want to expand your relationship with this company? And, my last question, why have you just decided to broaden the executive committee? Why are you taking that decision now and maybe not earlier? Thank you. On the headcount evolution, as you know, we've been decreasing headcount very meaningfully over the last 5-6 years. Actually I can say that we anticipated to some extent there would be some hands shortage at some point in time. We've seen that the labor market has been more intense over the last year, but we had anticipated to decelerate the growth of our headcount. This year we slightly increased headcount actually, and we maintained a strong capacity to hire and recruit. We've actually recruited very high profile talent this year from yeah, from the industry, and we've been able to rehire actually more than 600 times. In terms of attrition, as we said before, in the context of some pressure in the overall market for technology and video game industry, we've seen that we've been tracking a few points ahead of our historical trends. We made some interventions in October, notably in Canada, and we've seen some slight improvements over the last three months. Of course, it's something that we are carefully monitoring. In terms of what we're doing to stay competitive, of course, we carefully monitor key markets and look for critical skills to make sure we are absolutely competitive. On the Tencent partnership, first, you have to know that this partnership is really going well. We are developing mobile games together, and those games will come on the market at a later date, but they are very promising games. We have very good expectations, and we will do more with them. Now to answer your last question about the expansion of our ExCom. First, that team has been working together already for a while. It's just, we wanted to announce the new Ubisoft Sherbrooke to actually announce the group. It's a group that has been constituted to actually take advantage of all the new opportunities the market is bringing. As the business is more complex, we are more people now to tackle all those new problematics. Thank you very much. Thank you. That is the end of the Q&A session today. I would now like to hand the conference back over to the speakers for final remarks. Well, thank you very much for all your questions and have a good day. That does conclude our conference for today. Thank you for participating. You may all disconnect.