Good day, and thank you for standing by. Welcome to the dLocal Q4 2023 results. At this time, all participants are in a listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you'll need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. Please be advised, today's conference is being recorded. I would now like to hand the conference over to the company. Please go ahead. Good morning, everyone, and thank you for joining the Q4 2023 earnings call today. If you have not seen the earnings release, a copy is posted in the financial section of the Investor Relations website. On the call today, you have Pedro Arnt, Co-Chief Executive Officer, Sebastián Kanovich, Co-Chief Executive Officer, Sergio Fogel, Co-President and Chief Strategy Officer, Diego Cabrera Canay, Chief Financial Officer, Maria Oldham, SVP of Corporate Development, Investor Relations, and Strategic Finance, and Soledad Naka, Head of Investor Relations. A slide presentation has been provided to accompany the prepared remarks. This event is being broadcast via live webcast, and both the webcast and presentation may be accessed through dLocal's website at investor.dlocal.com. The recording will be available shortly after the event is concluded. Before proceeding, let me mention that any forward-looking statements included in the presentation or mentioned in this conference call are based on currently available information and dLocal's current assumptions, expectations, and projections about future events. While the company believes that our assumptions, expectations, and projections are reasonable given currently available information, you are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those included in dLocal's presentation or discussed in this conference call for a variety of reasons, including those described in the forward-looking statements and risk factors sections of dLocal's filings with the Securities and Exchange Commission, which are available on dLocal's Investor Relations website. Now, I will turn the conference over to dLocal. Thank you. Looking back on 2023, dLocal is celebrating remarkable achievements. Within a span of 5 years, our company experienced an extraordinary 14-fold expansion, achieving a record TPV of $18 billion, increasing by 67% year-over-year. This is a testament to the trust of our merchants, among the most demanding and sophisticated companies in the world, place in our solution. Most of the growth has been fueled by our existing merchants as we continue to gain wallet share. The trust our merchants place in our solution is also evidenced in our stellar NRR of 150%. We are committed to unlocking the power of emerging markets. In 2023, we enabled 154 million people in emerging markets to access global products and services. This is a 62% increase compared to 2022. In 2023, we proudly met the needs of over 600 merchants across 40 markets and consistently onboarded new merchants to our platform. Among the world's leading technology companies by market cap, we serve 5 out of the 6 major ones. Revenue witnessed significant growth in Brazil, 89%, and Mexico, 72%, our most mature and highly competitive markets. Africa and Asia delivered an impressive 114% year-over-year increase. We over-delivered on our revenue guidance, reaching $650 million, over 55% year-over-year. We remain focused on achieving gross profit growth, our key metric. Gross profit grew 37% year-over-year to $277 million. Our continued disciplined investment approach, coupled with a focus on sustainable growth, has delivered another outstanding year with a Rule of 40 at an impressive 110%. Our Adjusted EBITDA surpassed $200 million in line with our guidance. Furthermore, we've maintained the best-in-class Adjusted EBITDA over gross profit margin of 73%, even amidst ongoing investments to support our long-term ambitions. How did we achieve these remarkable results? Of course, through our people and culture. We efficiently grew our global team from 726 to 901 people, located across 49 countries. Very importantly, by continuing to be obsessed about our merchants and having them in the center of everything we do. We delivered innovative solutions and products against highly demanding merchant needs. In 2023, our platform solution gained traction, especially in marketplaces, expanding into five key markets in just one year. We have onboarded more than 230,000 sellers on behalf of our merchants in our marketplaces with automated KYC capabilities and flexible settlements for complex platform configurations. Last, and certainly not least, we are building upon our existing strengths by making investments in key capabilities, including growing our license portfolio, deepening our relationships with global banking partners, and ramping up our operations and back office effectiveness. In 2023 alone, we were granted licenses in strategic markets such as Brazil, Nigeria, Kenya, and Rwanda, and registries in South Africa, Philippines, Chile, Costa Rica, Panama, and Peru. We are carrying this momentum forward. In 2024, we are relentlessly focusing on serving our customers and solidifying our position as a preferred infrastructure solution for global merchants across emerging markets. We are committed to making 2024 our most remarkable chapter yet. dLocal, built for success in emerging markets. Hi, everyone. As the video illustrates, we've just delivered an incredibly strong year that has finished on a high note with regards to increases in both TPV and revenue. As a growth company, these two metrics are really important to us since they reflect our merchants' choices. Remember, our TPV is their revenue and is the best indicator of our ability to capture and retain share of wallet. We think in terms of decades, not quarters, and over the long run, which as I've just said, is what we're focused on, consistent growth in these two metrics drive operational leverage, which in turn drives increased profitability and cash flow, which is ultimately what generates shareholder value creation. Now, let me walk you through a more short-term view, reviewing our Q4 of 2023 results. We delivered what we consider stellar TPV growth of 55% year-over-year and an 11% quarter-on-quarter growth, surpassing $5 billion to $5.1 billion. This is another quarterly record, proving our solution's strong competitive position. The strong TPV performance we deliver translated into revenue growth of 59% year-on-year and 15% quarter-over-quarter, reaching a record $188 million. Growth was driven by a very strong performance in our most competitive markets, Brazil, where revenues doubled year-over-year and grew 12% Q-on-Q, and Mexico, which was up 59% year-on-year and 18% quarter-on-quarter. Additionally, Nigerian revenues doubled year-over-year and increased 3x quarter-on-quarter, driven by widening spread between the official and the market exchange rates, which conversely also resulted in a significant increase in repatriation costs. This strength in our biggest markets, combined with continued growth across other markets, was offset by a -26% year-on-year and -56% quarter-on-quarter contraction in Argentina. The weakness in Argentina was driven by two factors. First, a Q-on-Q decline in our higher take rate cross-border business as a consequence of tighter capital controls leading up to the year-end transition in government, which resulted in what we believe to be a temporary shift towards more local-to-local settlement by our merchants. Second, the country's currency devalued significantly towards the end of the quarter, further affecting our performance in dollars, not unlike the impact felt by most other companies with a relevant exposure to the Argentine market. I'd like to remind you that despite these short-term headwinds, we continue with a long-term view that Argentina is a relevant market for us and, more importantly, for our merchants. In complexity, we thrive, and we will continue to serve global merchants and consumers in that market. This impact that I've just narrated carried over to our gross profit line, resulting in a quarterly decrease in total gross profit to $70 million. That's down 6% Q-on-Q. However, if we exclude the Argentine segment, gross profit grew by 7% Q-on-Q. When we go to a year-on-year basis, gross profit grew by a still sound 27% year-on-year, or a very strong 48% when we exclude Argentina. Our net take rate decreased during the quarter by 20.5 basis points Q-on-Q to 1.4%. This has been as a result of shifts in business mix, with a lower share of pay-ins and cross-border volumes. We believe that these results indicate that although downward pressure on take rates continues, as we've repeatedly signaled, it is happening at a slow pace, and more importantly, driven primarily by mix shift, as we still continue to see limited pricing pressure that's derived from competitive dynamics. Let's move on to our OpEx structure for the quarter. During Q4, we continued to invest further in building out our team and establishing processes and systems to support our long-term growth ambitions. As a consequence of these investments, overall, OpEx increased to $29 million in the quarter. Main areas of expense increases were, one, tech-related expenses, including engineers, software licenses, and other IT and security expenses. Second, non-IT salaries and wages, as we continue to strengthen our team, including important leadership positions... and third, office expenses as we've grown our global footprint. Overall, OpEx represented 41% of gross profit, compared to 31% the prior quarter. For a more detailed view, please refer to slide 18 from the accompanying earnings material. I'd like to stress that we are convinced that these investments in technology, product, and people are very relevant to continue building a sustainable, high-growth business. As we continue to gain scale, we expect to see operating leverage in the midterm. As I go down the P&L, all this resulted in Adjusted EBITDA of $49 million, up 22% year-over-year, but down 11% Q-on-Q. Adjusted EBITDA margin contracted quarterly to 26%, primarily driven by the previously noted gross profit margin compression. Despite the slowdown in Adjusted EBITDA, we continue to deliver best-in-class profitability. Our ratio of Adjusted EBITDA to gross profit came in at 71% for the quarter, notwithstanding the investments undertaken I've just walked you through. Net income totaled $28 million during the quarter, growing by 47% year-on-year. Sequentially, that was a decrease of 29%. As we detail in the accompanying presentation, the quarterly evolution of net income was negatively affected by lower EBITDA, inflation adjustments under IFRS, which are accounting impacts, and increased stock-based compensation. Consequently, we've also observed an increase in our effective income tax rate from 18% the prior quarter to 21% in Q4, and that's a result of higher local-to-local share of pre-tax income and the fact that the IFRS inflation adjustments are non-deductible. Moving on to cash flow. During the quarter, we generated $36 million of free cash flow. That's our own fund generation, and $166 million during the year. Our net income to free cash flow conversion continued to be above 100%. Strong own funds cash flow generation was mainly driven by the net income profile of our financial model, and also by the recovery of $13 million of restricted cash that we had held as guarantees for standby letters of credit. During Q4, we also used part of our own funds to acquire an additional $16 million in Argentine dollar-linked treasury bonds in order to successfully hedge against FX exposure in that market. Consequently, we ended the year with a robust liquidity position of $326 million, including $223 million of available cash for general corporate purposes and $103 million of short-term investments. We remain committed to evaluating opportunities to take advantage of our differentiated financial profile that combines profitable growth with very strong cash generation, which allows us to explore inorganic growth, possible buybacks, and instituting a dividend policy. Overall, we're very proud of what we achieved in 2023, and we're also excited about our outlook for 2024 and even beyond. As I said before, I came to dLocal with the strong belief this is an outstanding business with significant opportunities ahead. That conviction has done nothing but increase in my time here. As a team, we remain focused on capturing the huge market opportunity ahead of us by continue to execute our land and expand strategy with our merchants, maximizing opportunities, and gaining share of wallet from them. We will also continue investing behind and tightening the foundations for future growth because we trust there will be a lot of future growth. First of all, we will further strengthen the dLocal team, investing in human capital with a particular emphasis on the engineering pool. Second, we will further upgrade our back-office capabilities. And third, we want to continue investing behind our licensed portfolio throughout emerging markets, which we are convinced can become a unique asset in the coming years. On this last point, it's worth pointing out that we were granted incremental licenses and registries across 10 markets during 2023, as the intro video showed. These three factors will contribute to further widening our competitive position over the long run. I'd like to now hand it over to Maria, who will walk you through how everything I've just outlined for you translates in terms of our financial outlook for 2024. Thank you, Pedro. Good morning, everyone. I would like to share our expectations for the full year 2024. We are adding TPV expectations this year, as we believe this is the most relevant operational metric for our company. It is the cleanest indicator of market share. As we mentioned earlier, ultimately, our merchants chooses us by routing more and more volumes through our systems than other alternatives they may have.... We are guiding for TPV growth of 40%-50%, surpassing $26 billion of TPV at the midpoint. As we currently see things, incremental volume growth will be back-ended in the year, starting off at a similar level to how we exited 2023, and picking up pace as the year progresses, given our growth in the highly seasonal e-commerce vertical and how we currently see our late-stage pipeline panning out. This strong TPV growth will be driven mainly by increased share of wallet from existing merchants and continued scaling of Tier Zero merchants. We continue to benefit from structural tailwinds associated with digital economy and the growth of the middle class in emerging markets. Africa and Asia are expected to grow at a faster pace, signaling the long-term potential for global growth. Verticals with most expected growth are e-commerce, advertising, and ride-hailing. As we always emphasize, our main financial focus is on maximizing absolute dollar gross profit growth, thus, we decided to guide for gross profit instead of revenue, as we believe this metric better reflects how we run our business. We see gross profit for 2024 between $320 million and $360 million. Our gross profit range assumes, first, increased mix coming from Tier Zero merchants as we continue to ramp up those global relationships, driving incremental TPV and wallet share from the world's leading tech companies, but at lower take rates. Second, sustained growth in our local-to-local business. We see this as a validation of our orchestration approach to payments and proves that we are competitive versus local acquirers. Third, normalization or tightening of FX spreads in certain dual currency rate markets, such as Argentina and Egypt, that generated windfall benefits in 2023. Despite the tightening of FX spreads being a headwind for our planning in 2024, it also represents a more sustainable and lower-risk gross profit profile. And fourth, mix of growth shifting to less mature markets where we haven't scaled yet. Final guidance is on Adjusted EBITDA. We are committed to running a financial model that combines robust midterm gross profit growth with EBITDA margin that is among the best in our comp set. This is our model of highly profitable growth. As such, we are reaffirming our midterm guidance of 25%-35% gross profit growth, 75% Adjusted EBITDA to gross profit margin. The trajectory towards that midterm guidance comes in for 2024 at around 70% Adjusted EBITDA to gross profit. This is an Adjusted EBITDA of $220 million-$260 million. We foresee OpEx increasing around 45% year-on-year. When compared to Q4 run rate, OpEx growth will be around 25%, despite a 2x growth rate expected for TPV in 2024, confirming the operational leverage existing in our business model and indicating that much of the incremental OpEx spend necessary for the long-term growth has already been incurred during H2 2023. This growth in year-on-year OpEx will be driven primarily by tech investments, as we aim to grow our talent pool by around 50%. Other main areas of OpEx growth will include sales and operations. As our short-term guidance indicates, we are investing with discipline so as not to deviate significantly from our midterm margin guidance. By reiterating our midterm outlook, as we look beyond 2024, we are signaling that once we conclude our short-term investment cycle in tools, processes, and people to secure our ability to scale the company for the long-term growth, we believe we will start to see the operational leverage inherent to our business model kicking in even more clearly. As mentioned in the opening remarks, that kind of scaling is what generates the cash flows that drive shareholder value creation over time. The clear potential of dLocal becomes obvious if one compounds our growth in line with our midterm targets over a multi-year period. Let me now hand it over to Seba. In a carefully planned transition that unfolded since August, Pedro is set to take on the role of sole CEO. My commitment to dLocal remains strong, and I will actively lead the newly established Commercial and M&A Committee as part of the company's board of directors. Over the past few months, Pedro and I have not only worked together, but learned from each other, capitalizing on our complementary skills to enhance the company's performance, especially in navigating intricate situations. As we progress to the next phase of our transition plan, emphasizing efficiency in daily decision-making, we are confident that Pedro is the ideal person to oversee dLocal's day-to-day operations. His instrumental role in scaling one of the most successful emerging market technology companies speaks volumes about his capabilities. Pedro's focus will be on the ongoing mission of company building, while my attention turns towards identifying pivotal growth opportunities for dLocal in the future... Now, I'll hand it back to Sergio to unveil further details about upcoming management changes. Hi, everyone. Thank you, Seba, for sharing this news with us. On behalf of dLocal's board of directors and the shareholders, I want to express our deep gratitude for your significant contributions to our company since inception. Working with you has been, and will continue to be, an absolute pleasure. Witnessing your journey, steering dLocal from its humble beginnings to a thriving startup in Latin America, and now to a global powerhouse, fills me with pride. As we move forward, we anticipate a shift in the leadership style needed by the company according to the various stages in its evolution. The challenges of 2023 prompted a defensive approach, leading to operational consolidation. With these changes now on track, we are transitioning to an offensive strategy. Our focus is on re-accelerating our long-term growth prospects through a combination of innovation with new product launches, expanded coverage in high-potential verticals, and growing our commercial team to ensure it is fit for purpose, and when the right opportunities arise, in organic growth through M&A. Sebastián's pivotal role in leading the newly constituted commercial, business development, and M&A committee will be instrumental in executing this more assertive strategy, geared towards long-term value creation for our shareholders. In my capacity as founder, principal shareholder, and active manager, it's immensely gratifying to observe Pedro, Seba, and the board collaborating to navigate this transition seamlessly. Our unwavering objective remains to preserve the core values and the capabilities that fueled our growth while embracing new opportunities as we scale into a much larger organization that can best serve our merchants throughout emerging markets. We firmly believe in this strategy. As proof of this, during 2023, as the main shareholders of the company, we have bought back $160 million worth of dLocal shares, showing our confidence in the long-term success of the business. In many ways, I see myself as the custodian of our company's legacy and culture, steering the course to maintain continuity, while also bridging the path towards essential changes that will secure our future success. With this, let me hand it over back to Pedro. Thanks, Sergio. As we reconfigure these leadership structures, I'm also very pleased to announce the newest addition to the team. Mark Ortiz will be joining the company as Chief Financial Officer, starting his role in April. As we continue our upward trajectory, we sought a robust financial leader capable of guiding us through the next phase of our growth. Mark brings a wealth of experience in that sense, boasting over 30 years of senior financial leadership, primarily at GE Capital, where he held roles as global FP&A leader and global controller across multiple departments. Mark's extensive background includes not only key financial expertise that's fit to our current requirements, but also working assignments across over 20 markets, making him well-suited for the global complexity that our company presents. I trust Mark is the optimal CFO choice to propel us to the next level of growth and reinforce our standing as a frontrunner in payment solutions for emerging markets. I hope everyone has a chance to meet Mark over the coming years and share the same enthusiasm we have with his arrival. I also want to make sure we all extend our gratitude to Diego Cabrera Canay for his invaluable contributions to dLocal. Diego played a pivotal role in establishing numerous finance functions at the company, prepped it for substantial international expansion and growth, and guided the company through its public listing process. Over the last three and a half years, Diego has been a steward of a business that has grown 10x in TPV, opened over 20 country operations, and multiplied its market cap by 4x. We wish Diego the best. In summary, I'd like to thank our global team, our valued customers, and our investors for all their continued support. Before we head back to your questions, I'd like to wrap up today's prepared remarks with one last thought. 2023 was a watershed year for dLocal. Despite facing significant market tests and macro challenges, we believe we've demonstrated the resilience of both our value proposition to our merchants and also of our business model, persistently growing and thriving through turbulent times. We believe we emerge strengthened and focused on tapping into the immense business opportunity ahead of us. We're committed to realizing the long-term company purpose of unlocking the potential of emerging markets. What we mean by this is building a bridge between the growing base of billions of consumers in the Global South and the products and services they demand, but that, until very recently, were exclusive to the minority of consumers who had access to payment mechanisms from developed markets. And as we accomplish this mission of closing the digital divide for emerging market consumers, we're also tapping into an incredibly attractive long-term market opportunity that is the one that underlies the investment thesis in dLocal. ... I look forward to giving you updates on our progress along this journey as the quarters evolve. With that, we can take your questions. Thank you. Ladies and gentlemen, if you have a question or a comment at this time, please press star one one on your telephone. If your question has been answered, or you wish to move yourself from the queue, please press star one one again. We'll pause for a moment while we compile our Q&A roster. Our first question comes from Tito Labarta with Goldman Sachs. Your line is open. Hi. Good morning, everyone. Thank you for the call and taking my question. A couple questions, I guess, if I can. Maybe to start just on Argentina, just given all the moving parts there. Just to clarify some of the comments, I think Pedro, you mentioned that there was more local-to-local transactions. Now, is that—does that mean that your existing merchants, are they getting, like, local subsidiaries and then are able to interact locally? Or are they just staying as they are and not being able to do cross-border, keeping money in the country? Just to understand sort of some of the mechanics, given the issues there. And then the... Would you expect this to sort of normalize in one Q already, or would it take longer to normalize? And somewhat related to that, just on the gross profit guidance of $320-$360, what does that imply for Argentina? Does that mean if Argentina sort of remains as it is, you're sort of at the midpoint of that guidance? Do you expect Argentina to improve, to deliver either at the higher end? And does it imply maybe Argentina gets worse at the lower end? And then my second question, I guess, is more on Nigeria and Egypt, because we've also seen big devaluations there in the Q1 of this year. And we did see a big growth in both Nigeria and other Asia and Africa. So if you can help us understand what the potential impact of those devaluations should be, I guess, in one Q, and how that may have been reflected in the guidance? Thank you. Thanks, Tito. So lots of moving pieces. Let me walk down the questions. So the increase in local-to-local settlement in Argentina is not a change in how our merchants are set up, but rather as volatility increased, and more importantly, capital controls tightened even further leading into the election, many merchants started to opt for local settlement. We don't necessarily think that's a structural change. We see that eventually, as capital controls are lifted, there is an opportunity to regain those flows into cross-border, but that will take continued normalization in Argentina, which we believe will happen midterm, not happen in short term. Our guidance for the year, when we compare it to the 2023 comps, does assume Argentina structurally, although potentially has an opening of capital controls, will also have tighter spreads on FX as the government has signaled an intent to move towards a single exchange rate. So we do build into our 2024 guidance, lower gross profit from Argentina when compared to 2023 on a margin perspective. What we need to see is, does macro improve enough so that towards the end of the year, volumes pick up significantly, or is that more of a midterm trend? We do believe that long term, that market continues to be an important and attractive market for us. Egypt, I would say, has similar dynamics. Egypt, as we've seen in Q1, the devaluation, that's made for tighter spreads on repatriation and cross-border flows. It potentially starts signaling greater liquidity in the market for FX, but at a lower margin profile than what we had up until now. Just to give you an order of magnitude, Egypt full year represented roughly less than 10% of our business, but growing towards the back half of the year, given that spreads were widening, and now with the tightening of spreads on FX for 2024, we also assume that Egypt becomes a bit of a headwind short term for us, so into 2024. Nigeria is somewhat of a different situation. I think as we've said consistently, the revenue fluctuations in Nigeria don't really flow through gross profit as much. So gross profit in Nigeria for the quarter was roughly in line with what it was for Q3, very, very slightly down, despite the big increase in revenues. The guidance for Nigeria is that in terms of trajectory, we hope to continue to see TPV growth there, generally at similar margin levels in what we had in 2023. Great. That's helpful. Very clear, Pedro. Maybe just a follow-up, if I can. Back on Argentina, just to make sure I understood correctly, so you said that the merchants are opting for local settlement. So that means, I guess they're basically keeping money in Argentina, and I guess they're not bringing that, I'm just trying to think how that necessarily impacts their business. But I guess the assumption would be, as things normalize, they would eventually expatriate that money back to their home country, and then could you get some additional revenues as that happens? Just to make sure I understood that correctly. That's correct. So we have two flavors of settlement. We can settle locally, and therefore, we don't have an FX component to our fee, or the core of our business, roughly half of the volume, we can settle for merchants internationally, and then there's an additional fee for the repatriation service. What we've seen in Q4, and you see that in the disclosures, is that the mix has shifted more towards local-to-local. And that's been particularly the case in Argentina, as capital controls tightened towards the end of the year. Okay, that's clear. Thanks a lot, Pedro. I appreciate the response. One moment before our next question. Our next question comes from Jason Kupferberg with Bank of America. Your line is open. Hey, this is Melissa Cha on for Jason. In your prepared remarks, you mentioned making investments in hiring and upgrading back office capabilities in 2023. Can you give us an idea of the cadence of these investments throughout the year? Will they be sort of, like, spread evenly or front or back-end loaded? Any details there would be helpful. Two quick thoughts there. The first one, as you can see from the margin structure, the Adjusted EBITDA to gross profit margin in the 2024 guidance at the midpoints, we are leaning into the business to build the right foundations, but we're doing so in a very, very disciplined manner. So even in this year, where we're not delivering operational leverage, we're still coming in at what would be best-in-class Adjusted EBITDA to gross profit margin at around 70%. I think that's important to stress. The cadence of incremental investment, if we look at the Q4 run rate, is really not significantly increased, into 2024, which should be one of the heavier years in terms of investment, and we continue to be optimistic about the midterm operational leverage, and even more so, the long-term operational leverage of our financial model, as is the case with most payments companies. Therefore, we've reiterated the midterm guidance. The cadence of that could potentially be slightly skewed toward the first half of the year, but since the biggest areas of incremental investment, as we've said, is engineering talent, and that's also one of the reasons why we're optimistic about midterm operational leverage, is a lot of what we're doing is building capabilities to be able to automate more, to be more efficient. dLocal will continue to want to run as a lean organization, where we automate as much as we can. But so if we're able to hire more of those engineers in the first half of the year, excellent, that might skew the investments to H1. But we wanna make sure we're hiring the right people, so that could end up being evenly distributed throughout the year, depending on the pace of hiring. Okay, cool. Thanks. One moment before our next question. Our next question comes from Neha Agarwala with HSBC. Your line is open. Hi, thank you for taking my question. Just a quick one. In terms of volume growth, are you seeing a pickup or a slowdown from your key merchants? Any changes in terms of which verticals are more important, less or less important? Anything to highlight in terms of volume growth. And second question is, again, on Argentina. Should we expect Argentina, Nigeria, Nigeria, you mentioned, could be a bit of a headwind, but what other distortions can we expect, at least in the first half of this year, from countries like Argentina, Nigeria? Any specific color would be very helpful. Thank you so much. Hi, Neha. Thanks. So in terms of verticals, if you look at the disclosures, we continue to see incredible strength in e-commerce. That was nearly 200% year-on-year growth as a vertical, and then continued strength across many of the other verticals, financial services, ride hailing. We saw, I would say, less relevant growth in the high 20s or low 20s across on-demand delivery and advertising. Some of that driven by the Argentina situation, and some of that more globally. But in general, I would say there hasn't been a significant change in verticals, with the exception that e-commerce continues to gain mix. We are a particularly well-suited service provider and solution for many of the global e-commerce players as they globalize more and more. So we're seeing some really interesting gains in new markets that we are offering to some of the largest global e-commerce players. On Argentina, Nigeria, Egypt, just to be clear again on what I said before, what we've built into the guidance is we expect for Argentina and Egypt, a certain level of margin headwinds when we think of gross profit margin in those markets, as exchange rate spreads have tightened. And so that is built in to 2024, the tougher comps from 2023 in those two markets that had high margins on wide FX spreads, especially in Q2 and Q3. Nigeria, I said, is a different situation where at the revenue level, we do see oscillations because of fluctuations between the official and the market exchange rate, but it's much more neutral at the gross profit level. Nigeria, we see a similar gross profit margin for the 2024 guidance. Perfect. Super clear, Pedro. One last one. I know this year the focus is more on building up the organization and investing a bit more in prepping up the company, but any plans in terms of revenue diversification? KYC, we've talked about additional services like SaaS as a service. Is any new services on your mind that we would expect during this year or next year? Thank you so much. So as Sergio mentioned in his remarks, our strategy is one of being innovative and launching new products into the market and also pursuing new verticals. We've had tremendous recent success with the marketplace product, and we hope to continue to see that in 2024. We've launched an invoice product, which is aimed at corporate treasuries and accounts receivables that we'd like to push and see that grow. And then there are a few new verticals that we're beginning to plant the seeds for, we'll need to see how those play out. As you know, in our business, there are sometimes long lead times in terms of moving into a new vertical, and then those ramp-ups really kick in. So if anything, those are expected more towards the back end of 2024 and then potentially into 2025. Thank you. One moment before our next question. Our next question comes from Jamie Friedman with Susquehanna International Group. Your line is open. Hi, thank you, guys. Thank you for taking my questions. I like the new format of the presentation, by the way. I just want to mention. But I want to ask about the revenue growth from new merchants, up 68.6%, which accelerated from the third quarter. Can you help unpack that? Is that the... From the new merchants that you had alluded to earlier in the year? Or if you could share a framework about how to think about new framework, new merchant contribution, it would be helpful. Still there, Pedro? We're here. Oh. We're just making sure we get our numbers right. Okay. Just wanted to make sure you guys didn't get disconnected. Thank you. Yeah. No, we're here. So, Jamie, thanks for the comments on the presentation. I'll give you directional. So, when I look at the new merchant growth, there's a combination of some of the well-known large global brands, particularly some out of Asia, that have been relying on us for their expansion, mainly into Latin America, but we continue to increase some new geographies with them. You see that when you look at the e-commerce vertical, the growth there. We've had some ramp-up from another very large global merchant in Chile. That's also adding to that. And then the rest is fairly distributed among some smaller Tier Two merchants that we've onboarded and whose ramp-up has been quicker, sometimes also because they typically exclusively use us for their international expansion. Okay. And, maybe just as a follow-up to that same direction. I should know this, but, can you remind us how much of the TPV or revenue come from the installed base each year? If that's an obvious question, I apologize, but if not... Is there a way to think about that? Jamie, I think Maria or Diego or, or Seba can take that one. Just one more clarification on your previous question. Also, some of those Tier Two merchants have an overlay from Nigeria, and we've seen the big revenue jump in Nigeria because of the exchange issue. So that also drives some of the new merchant volume growth. I'd say the large global merchants in Latin America, that's long-term, sustainable, and very healthy. The Nigeria piece, as you know, is somewhat more volatile and less impactful at a gross profit level. I'll hand it over to the team for the question on recurring revenue versus new merchant revenue. Sure. In terms of our business trends, you know, one of those is our NRR. So we continue to post 149% NRR for Q4, and 150 for the year, which shows that we continue to grow with our existing merchant base. We are still at low tens on the market wallet share of those merchants, so they're very high potential still from our existing base. Still, we continue to work on our pipeline, with very strong names coming in. In Q4, you saw $12 million of revenues coming from new merchants cohort, and this is pretty much in line with the starting of the cohort. Great. Thank you, Maria. Thank you, Pedro. One moment for our next question. Our next question comes from Matt Coad with Autonomous Research. Your line is open. I think that was for me. This is Matt Coad from Autonomous Research. Guys, your language, I feel like, changed a little bit in terms of potential M&A. Just wanted to ask a question about that, just if you could double-click on kinda like, what assets, what type of assets would intrigue you? Matt, Sebastián here. Thanks for the question. We've stayed very consistent over the years about our intentions to potentially do M&A. We've been extremely conservative around that, particularly because we really like our company and our organic growth story. We'll continue to look at three potential vectors. One is commercial distribution, the other one is product innovation, and the third one, geographic footprint. Ideally, we'll combine all three of those. We've done only one deal in our history, which was, in our view, an absolute home run back in 2021. But at the same time, we'll always benchmark any potential M&A against our own company and what we could potentially do by buying back our own shares. When we check, or we diligence any other company, we always make sure to benchmark those against dLocal as a potential M&A target. We have a big pipeline of opportunities. We continue to engage with multiple targets. There's nothing imminent today, but it's definitely a vector that we're gonna continue to explore. We believe there's gonna be consolidation in this space, and we believe that dLocal is very well positioned to be a consolidator. Super helpful, Seba. Thank you. And then just as my follow-up, guys, the short-term investment cycle that you guys have touched on so far today, just kind of wanted to unpack that a little bit more and just... It makes sense to us, right? Like, there's a lot of reinvestment that needs to occur to run a complicated cross-border payment system. But could you unpack a little bit like, of why that's occurring today and why it hasn't occurred over time? And kind of just reinforce why you think this is kind of a one-time investment cycle rather than just natural reinvestment that needs to occur consistently over time. Sure. Let me start by the back question. There is an element of playing catch-up. Let me give some more granularity when we look at 2024 guidance and where we're increasing our investment. The greatest area of incremental spend is on the engineering talent pool. We're striving to grow that talent pool by between 50%-75%, and that's by far the largest increase in spend. The second area is in operations. As we begin to consolidate our position across these 40+ markets, we continue to add more processing partners, more relationship with issuers, more relationships with the local payments ecosystem, and that requires a level of increase on feet in the ground to build increasingly more robust operational capabilities in many markets where initially we launch with-... The bare minimum necessary to serve our merchants, and then we add more and more capabilities in those markets. So I think part of the pickup in spend is just the natural tendency to go deeper in markets, but then that has sort of a flattening out. I think we've said we don't necessarily aspire to cover 80 markets. Our footprint will grow if our merchants ask for more markets, but we believe we have a good grasp on most of the attractive emerging markets. And so you go a bit deeper, but there's a point where you already feel you have very robust capabilities, and the investment cycle flattens out a little bit. And the same goes for IT. I mean, clearly, we're not gonna be growing our engineering talent pool at those levels consistently over a multi-year process because that's simply not efficient. We do think there's a bit of catching up to do, and we also think that with this leaning into the engineering talent short term, it also allows us to be much more efficient on the back end of that, because we're able to automate more and more functions that otherwise would require increases in headcount or third-party services. Hence, we believe that there's this cadence of specific- Please enter your dial list. The PIN you entered is already in use. If you continue, your prior call will be disconnected. Press any digit to continue joining. Bye. We didn't detect any input. Goodbye. When we look at our late-stage pipeline, if we execute well on what looks like a promising late-stage pipeline, our expectation is that the business begins to pick up as we move forward towards the end of the year. Again, that's predicated on continued successful execution, but to the best of our knowledge today, that's what's built into the guidance. All right, thank you. I just have one follow-up. Given that I think we only have, like, you know, 10 or 12 more days left in Q1, you've seen a lot of the quarter already. Do you have any early comments you could say about anything that you may have seen in January, February, or what we've seen of March so far, regarding any early indicators and just any thoughts you have on Q1? I think we should follow the protocol of we'll comment on Q1 when we come out with the complete information and communication to the market. So we'll be more than glad to give you guys as much detail as is necessary when we announce Q1. I think in terms of the general cadence built into the guidance, which was your previous question, we've given you as much directional understanding of what the guidance implies as makes sense at this point. All right. Thanks, Pedro. One moment for our next question. Our next question comes from Ashwin Shirvaikar with Citi. Your line is open. Thank you. Appreciate all the detail and color in the call. Pedro, a question for you. You know, as I sort of look at, look at the stock over time, right? One of the repeat issues for the stock has been just the very definition of where you focus, which is emerging markets, which implies, you know, narrow situations, volatility, influence of regulation by country, and so on. So is there anything you think you could do from a organizational design or risk management perspective? You know, and it may already be in progress, but just want to figure out what you can do to avoid sort of the, you know, quarter-to-quarter volatility by country that has plagued the stock for, you know, many quarters in a row now? ... Yeah, I wish I had a better answer for you, but the reality is that we operate in volatile parts of the world. The answer to that is scale. As our business continues to grow, as our TPV continues to come from an increasing number of markets, an increasing number of merchants, in general, that diversification ideally will generate less lumpiness in the business as it scales out. That's both from an exposure to a market, but also exposure to merchants. We still have a higher level of concentration in the top merchants than is ideal, and than we strive to have if we look forward 2, 3, 5 years. So the best answer I can give you is this is a lumpy business driven by the complexity of the markets where we operate, and the fact that our merchants sometimes take long to ramp up, and then when they begin to ramp up, ramp up very aggressively, as we saw in the Q4, where concentration actually increased, driven by two merchants that have given us incremental share and have grown volume significantly. So the solve here is not a short-term solve. It is what it is. And the solve is simply size, scale, and diversification, ideally generates more predictable revenue streams going forward. Also, focus on gross profit, that is a metric that, although it's also characterized by the volatility typical of emerging markets, is less volatile than the revenue metric, and hence why we've been giving increased importance to that one. Okay. No, that makes a ton of sense. I guess the second question is just with regards to all the changes that have been going on at dLocal. As you've been having conversations with your clients, do they care about all the internal changes going on, or is it more or less that, you know, they need these capabilities in emerging markets? The list of companies that provides the services across multiple markets is a short list, and so the TPV growth should continue at a healthy level. Hi, Ashwin, how are you? Seba here, and thanks for the question. So Ashwin, the way merchants vote, if you will, it's where to send volumes to, and because that's what they get to decide. Revenue, gross profit, EBITDA, it's everything more on our own efficiency. And if anything, we've seen that merchants not only continue to vote for dLocal, but they do so at a scale that we've never seen before. Last year, we grew our volumes more than 50%, you see quarter-on-quarter growth. And I think that's a testament of how valuable what we are doing is. Merchants derive a lot of value from our offering, we continue to be extremely differentiated. And if you ask me, that's probably what makes it the most bullish. We've been through a lot last year, and the fact that we haven't lost any customer, but not only that, and have been able to grow as much as we did, I think it's a testament of how unique our positioning is. Merchants want dLocal to be a living creature, we've always been a living creature, where we are always iterating and trying to become a better company. We will continue to do so, and I think if there's anything that our customers value, it's the fact that we are very innovative, and we move fast. And we continue to do so and, and we intend to continue to do so. So, we are very, very optimistic for what we've seen in 2023, and what we are seeing, for the future. Thank you. One moment for our next question. Our next question comes from Kaio Prato with UBS. Your line is open. Hello, everyone. Good morning. Thanks for the opportunity. I have two on my side, please. First is a quick follow-up on Argentina, please. You mentioned, Pedro, in your first answer, that believe that merchants will probably come back to cross-border operations. But just to understand here, what makes you comfortable with that? Like, in other words, why do you think it would make sense for merchants to opt for cross-border again, since today you are probably working with other options. So just would like to understand if you're already seeing increasing demand for cross-border again at this point. Then I will come back with the second. Thank you. Okay. So, our indication was not that merchants are doing cross-border through other options. Merchants with stricter capital controls were settling locally so as to not leave funds with their processor, namely us, but have the funds themselves. The ultimate objective of these merchants is to repatriate those funds. Many times the alternative to local payment methods, like the ones we offer, is simply international processing, which is more expensive, has lower performance, and also locks out millions of consumers. So just if we look at the underlying dynamics of payments, and that's why we exist and why we add so much value to our merchants, the cross-border option many times is a better solution for them than local-to-local. At the end of the day, we need to serve our merchants, which, whatever is best for them, we don't decide if it's local-to-local or cross-border. We've seen really good growth in our local-to-local business. Which is something that was doubted of us, and we've delivered consistently, so we'll see what happens. But our conversations with merchants and the underlying logic is that eventually, as capital controls are lifted, cross-border will pick up again. And we do have access in Argentina for a series of verticals to do cross-border repatriation already. So we're beginning to see increased liquidity, and we're beginning to see that market open, and therefore, short term, we don't see any dramatic change in what we saw in Q4, but more midterm, we do believe that cross-border can pick up again. Okay, great. This is very clear. Thank you, Pedro. And the second one is regarding to your letter that you mentioned that about the license portfolio. Just would like to understand if you could give us an example of license that you are aiming to pursue this year, and what benefits could that bring to the company? Just wondering if you are thinking about a license in Brazil at this point as well. Thank you. Okay. I believe our license portfolio in Brazil is already complete for what we have applied to in terms of short and midterm plans. It's one of the markets where we have multiple licenses. When I look globally, we have many, many licenses in the pipeline, both at an emerging market level and also at an OpCo level. The licenses for us enable us to integrate more vertically. So many times we don't have to rely on licensed partners if we have the license ourselves, which allows us to offer better solutions. In some cases, the licenses allow us to move into verticals or flows that we can't pursue without the license. And equally important, the license, I think, brings us under regulatory oversight and gives our merchant an added sense of comfort with the operation. So because of that, there is, as we've said, a fairly large pipeline of licenses and registries that we've applied for. We've continued to be granted some of those in Q1. We'll give detail when we announce Q1, and that should continue to be the trend going forward. We actually see a robust license portfolio across complex emerging markets as a potential competitive advantage when we think of dLocal long term. Okay, great. Thank you very much. I'm not showing any further questions at this time. I'd like to turn the call back over to the company for any closing remarks. Thanks, everyone, for the questions. A lot of information we've sent your way. I hope the increased disclosures are helpful, and we look forward to updating you on our Q1 results in the coming months. Thank you very much. Ladies and gentlemen, this concludes today's presentation. You may now disconnect and have a wonderful day.