Bending Spoons Q2 2026 Earnings Call Transcript

Quartr
Provided by Quartr
August 13, 2026

Key Takeaways

  • Positive Sentiment: Q2 revenue rose 126% to $704 million, while adjusted operating income increased 150% to $381 million, with the margin expanding to 54%. Diluted EPS and adjusted EPS increased 163% and 167%, respectively.
  • Positive Sentiment: Management reiterated strong M&A momentum, completing the $759 million Tractive acquisition and agreeing to acquire Airtable for $1.29 billion. The company said its pipeline remains robust and that the Airtable deal is expected to close before year-end, although it is not included in current guidance.
  • Positive Sentiment: Management reported progress integrating AOL, Eventbrite, and Vimeo, including more than 70 product improvements and major technology modernizations. At Eventbrite, paid user-acquisition spending fell about 30% without harming top-of-funnel metrics, while advertising monetization improved approximately 20%.
  • Neutral Sentiment: Organic revenue growth was 3%, with strength from WeTransfer and Tractive offset by declines at Remini and Splice. Management said AI has not materially disrupted most businesses, though it may be contributing to greater competition and customer-acquisition difficulty at Remini.
  • Negative Sentiment: The company’s long-term expansion depends on attracting talent, integrating acquisitions, and accessing capital, with operational capacity identified as a potential bottleneck. Interest expense increased 205% year over year amid higher debt levels, although post-quarter IPO proceeds and new financing provide funding for Airtable and additional deals.
AI Generated. May Contain Errors.
Earnings Conference Call
Bending Spoons Q2 2026
00:00 / 00:00

There are 13 speakers on the call.

Operator

Good day, and thank you for standing by. Welcome to the Bending Spoons Q2 2026 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, please press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. For the benefit of all participants on today's call, please kindly limit yourself to one question and one follow-up so that everyone can ask their questions. Please note that today's conference is being recorded. I would now like to turn the conference over to your first speaker, James Caldwell, Head of Investor Relations. Please go ahead.

Speaker 1

Thank you. Hello, everyone. Welcome to Bending Spoons Q2 2026 earnings conference call. With us today to discuss our results are Luca Ferrari, Co-founder and CEO, and Enrico Martinelli, Co-CFO. For the Q&A portion of the call, we will also be joined by Davide Scarpazza, Co-CFO, Francesco Mancone, CTO, and Francesco Patarnello, Co-founder and Head of M&A. Before we begin, let me cover the safe harbor statement. Some of the information you will hear today will consist of forward-looking statements, including those regarding our objectives and outlook. These statements reflect our current expectations and are subject to a variety of risks and uncertainties. Actual results and events may differ materially. For more information, please refer to our registration statement on the Form F-1, including the risk factors described there. We assume no obligation to update any forward-looking statements. During the call, we will discuss both GAAP and non-GAAP financial measures.

Speaker 1

You can find the definitions of our non-GAAP financial measures, together with reconciliations to the most directly comparable GAAP financial measures in today's earnings press release, which is available on the Bending Spoons investor relations website, investors.bendingspoons.com. Unless we say otherwise, all comparisons refer to year-over-year results. Now, over to you, Luca.

Speaker 2

Thanks, James, and thank you all for joining Bending Spoons' first quarterly earnings call. I will first explain what Bending Spoons is, then I will briefly summarize the quarter. Finally, I will address a question central to our long-term prospects. What could constrain our ability to scale? Our playbook is simple. We acquire digital businesses, undertake deep integrations and transformations to improve them, and reinvest the cash they generate together with incremental leverage in further acquisitions. Underlying this playbook is our long-term aspiration to build what we think of as the perfect operating machine. We have been refining this model since 2013. At its foundation is what we call our platform, which consists of three elements: our people, our proprietary technologies, and our proprietary data. Today, our platform brings together nearly 700 selectively recruited core team members whom we call Spooners.

Speaker 2

Powerful internally developed technologies spanning everything from A/B testing to AI model orchestration, and valuable insights accumulated through more than 50 acquisitions and thousands of experiments. Our results to date have demonstrated what we can achieve with this platform. Since the start of 2023, we have deployed nearly EUR 6 billion across 15 acquisitions, consistently applying 25% unlevered and 65% levered IRR hurdles in our underwriting process. Through the execution of our playbook, we have more than tripled revenue, operating income, and adjusted operating income in the 2 years to 2025. I will turn now to Q2 2026, where we delivered a similar level of growth. Revenue increased 126% to $704 million. Operating income increased 139% to $240 million, representing a margin of 34%.

Speaker 2

Adjusted operating income increased 150% to $381 million, representing a margin of 54%. Diluted earnings per share was $0.28, up 163%. Adjusted earnings per share was $0.46, up 167%. Operationally, we made encouraging progress in the transformations of AOL, Eventbrite, and Vimeo. During the quarter, we released more than 70 product improvements across these three businesses. We also made substantial progress modernizing their underlying technologies, creating a stronger foundation for a faster pace of product development and monetization improvement.

Speaker 2

We continued to strengthen our proprietary technologies, added dozens of Spooners to our team, expanded our sources of financing, completed the acquisition of Tractive for an enterprise value of $759 million, and undertook negotiations to acquire Airtable, with us last week announcing we had reached an agreement to acquire the business for an enterprise value of $1.29 billion. While we are pleased with what we have delivered in Q2, our focus remains on the long term. In particular, given how quickly we have been growing, a natural question is how far Bending Spoons can scale, and what could ultimately limit that growth. We think about this constantly and see at least three potential constraints. The availability of attractive acquisition opportunities, our operational capacity to integrate and transform the acquired businesses, and access to capital at reasonable terms.

Speaker 2

To expand our capacity to grow and fulfill our ambitions for Bending Spoons, we continually work to ease these constraints. I will discuss our approach to each in turn and highlight some of the actions we have taken recently. The first potential constraint is the availability of attractive acquisition targets. As we described in our IPO prospectus, our bottom-up analysis has identified more than 1,000 digital businesses that could be attractive targets over the next several years. Collectively, those businesses generate nearly $400 billion of estimated revenue in 2025. We therefore do not currently view target availability as a material constraint, at least for the next few years, and our acquisition pipeline is as strong as at any point in our history.

Speaker 2

However, to maximize our prospects of generating attractive returns for many years to come, we believe it's important to continue expanding our addressable market and broadening the range of businesses within this addressable market with acquisitions we can underwrite with conviction. We approach this deliberately. Ideally, for any acquisition of material size, the core economics should be familiar to us, and any new capability the business brings should have the potential to be reused across our platform. Tractive is a good example. It's the market-leading pet tracking and health monitoring service, and we were attracted to the business due to the growth potential of the category and the opportunities we saw to continue improving the product offering, broaden distribution, and optimize marketing. Tractive primarily generates revenues through subscriptions, an area in which we have extensive experience.

Speaker 2

However, it also incorporates a physical device, giving us an opportunity to deepen our capabilities in areas such as hardware design, device connectivity, supply chain management, and support for an installed base. Success with Tractive would give us confidence in further expanding our addressable market. Airtable provides another example. Airtable is a no-code, low-code platform that enables teams to organize data and manage critical workflows. The strength of its brand and product, its positive revenue trajectory, and the still sizable opportunity in the category all contributed to our decision to acquire the business. A substantial portion of Airtable's revenue is generated through the self-serve channel, again, an area very familiar to us. However, the pending acquisition would also create an opportunity for us to deepen our experience serving enterprise customers through direct sales.

Speaker 2

Enterprise SaaS is included in our EUR 400 billion addressable market estimate, and we already have a foundation in this area through Brightcove and Vimeo. At the same time, further enhancing our platform in connection with direct enterprise sales will improve our ability to constantly underwrite more acquisitions of this kind going forward. The second potential constraint is the operational capacities required to undertake the deep integrations and transformations that are often needed to achieve our return objectives. AI is becoming increasingly important in expanding that capacity, and during Q2, we made further progress incorporating AI into our day-to-day work. One example is Alt-Spooner, a personal AI agent that we developed during the quarter and made available to every Spooner in early July. It operates within each user's existing access permissions and can work with that person's authorized history and connected accounts.

Speaker 2

Alt-Spooner runs on open-weight models that we host ourselves, and its model-agnostic architecture allows us to use and compare different models, including closed-weight ones, as their performance and economics evolve. During its first three weeks of general availability, Alt-Spooner processed more than 100 billion tokens. The speed of adoption and its effectiveness have been encouraging. I personally had some wow moments with Alt-Spooner. During Q2, we also introduced AI-enabled interactive tasks into parts of our recruiting process. Our testing indicates that these tasks provide a predictive input into candidate assessment. They also make our recruiting process more scalable. These initiatives build on the broader, sophisticated, and longstanding use of AI across our platform, and our overall progress in expanding operational capacity can be seen in our productivity metrics. In Q2, revenue per Spooner exceeded EUR 4 million on an annualized basis.

Speaker 2

We're also undertaking increasingly large transformations without a comparable increase in the number of Spooners deployed. For instance, around 60 Spooners worked on Vimeo during Q2, broadly in line with the number of Spooners who worked on the Evernote transformation in 2023. This is despite Vimeo being roughly four times the size of Evernote in revenue terms and a more complicated business from both a technical and operational perspective. Even with these efficiency gains, Spooners are likely to remain our scarcest resource. Therefore, we'll continue to invest in our ability to attract, select, retain, and develop exceptional talent at scale. We'll also continue to make aggressive trade-offs as we deploy resources to what we judge to be the highest return activities. Most often, this is the integration and transformation of recently acquired businesses.

Speaker 2

Finally, we can't rule out the possibility that from time to time, we'll have to slow down our acquisition activity in light of operational capacity constraints. The third potential constraint is access to capital. Through the actions taken during Q2 and after quarter end, both the scale of the resources available to us and the breadth of our financing options have improved. During Q2, we entered into new EUR-denominated term loan facilities totaling EUR 255 million and increased our EUR-denominated revolving credit facility by EUR 460 million for a total of $1.58 billion based on the quarter-end exchange rate. After quarter end, we secured a further EUR 590 million of term loan financing, increased our revolving credit facility by another EUR 30 million, and received net proceeds of $1.10 billion from our IPO.

Speaker 2

These actions, together with our existing cash balances and the cash we expect our businesses to continue generating, provide sufficient funding for the pending Airtable acquisition while preserving flexibility to pursue additional acquisitions that meet our return thresholds. We intend to exercise that flexibility while maintaining plenty of headroom under our debt covenants and sufficient liquidity to meet our obligations in a range of downside scenarios. As a public company, we now have access to a broader range of financing sources. We'll select among those sources carefully, remaining focused on the objectives of maximizing long-term shareholder returns while keeping a prudent risk profile. With that, I'll hand the call over to Enrico to discuss our financial results in greater detail.

Speaker 3

Thank you, Luca, and hello, everyone. In Q2, we delivered triple-digit revenue growth and expanded our profitability with contributions from across our diversified portfolio of businesses. Cash generation and our financial position remain strong. I'll cover each of these areas before discussing our outlook. For Q2, total revenue was $704 million, up 126%. Organic revenue growth was 3%. Underpinning this organic revenue growth, the strongest contributions came from WeTransfer and Tractive, partly offset by a decline in Remini and Splice revenue. Relative to our expectations, we primarily saw better than anticipated performance in AOL Advertising. Q2 operating income totaled $240 million, increasing 139%, and adjusted operating income reached $381 million, increasing 150%. To calculate adjusted operating income, we remove amortization and impairment of acquired intangible assets, transaction-related expense, reorganization-related expense, and other items that we don't consider indicative of core or ongoing operating performance.

Speaker 3

Operating income margin was 34% and adjusted operating income margin was 54%, expanding 2 percentage points and 5 percentage points respectively. This margin expansion resulted from scale economies as well as operational efficiencies unlocked as we continue to improve our platform. In addition, we keep redeploying Spooners to areas offering the highest return, which we see as an advantage of our approach. Looking at the major components of our cost base, cost of revenue increased to EUR 241 million, representing 34% of revenue, unchanged from the prior year period. The increase in cost of revenue was primarily driven by three factors. First, an increase in amortization of acquired intangible assets reflecting continued acquisition activity. Second, an increase in IT infrastructure expense reflecting an increase in cloud infrastructure utilization, mainly driven by acquisitions. And third, an increase in distribution and payment processing expense reflecting the increase in revenue.

Speaker 3

Operating expenses increased to EUR 223 million, representing 32% of revenue, compared with 33% in the prior year period. The increase in operating expenses primarily reflects personnel costs associated with the ongoing operation of newly acquired businesses and separation packages offered to team members in connection with the reorganization of AOL, Eventbrite, Tractive, and Vimeo. After adjusting for the items excluded in our calculation of adjusted operating income, cost of revenue increased to EUR 155 million. This represents 22% of revenue, unchanged from the prior year period. The increase was primarily driven by IT infrastructure expense and distribution and payment processing expense. Adjusted to exclude the same cost items, operating expenses increased to EUR 168 million, representing 24% of revenue, compared to 29% in the prior year period. We continue to drive productivity across the organization and remain disciplined in our approach to sales and marketing activities.

Speaker 3

The development and adoption of cutting-edge technological tools has been, and should remain, a key driver of efficiency gains. Equity compensation expense totaled EUR 14 million in Q2. We do not exclude this expense in the calculation of our non-GAAP financial measures. Returning to our GAAP financials, interest expense was EUR 109 million, rising 205% year-over-year due to an increase in our absolute debt levels and to a much lesser extent, an increase in the effective interest rate. Other income was EUR 90 million, and we recognized an income tax benefit of EUR 26 million. This resulted in dilute earnings per share of EUR 0.28 and adjusted earnings per share of EUR 0.46, up 163% and 167% respectively. As we detailed in our earnings release, we've revised our definition of adjusted net income and adjusted earnings per share to exclude two additional items.

Speaker 3

Foreign exchange gains and losses on assets and liabilities denominated in a non-functional currency are now excluded, as are gains and losses from changes in the fair value of interest rate swaps. These items are recorded in other expense income in our GAAP financial statements and have been excluded from our non-GAAP financial measures as we believe that such adjustments improve period-to-period comparability. Full details of these revisions, together with recast historical results, can be found in our earnings release. Turning now to cash flow and our financial position. For the first half of 2026, net cash from operating activities totaled EUR 254 million against capital expenditure of just EUR 4 million. This cash flow was net of cash payments associated with transaction-related expense and reorganization-related expense. In terms of uses of cash, in the first half of the year, we paid EUR 2.29 billion for acquisitions, net of cash received.

Speaker 3

We also made $204 million in principal repayments of long-term debt. We ended Q2 with total long-term debt of $4.88 billion, cash and cash equivalents of $793 million, and thus net debt of $4.09 billion. Leverage ratio stood at 2.4 times. Please refer to the earnings release for the definitions of net debt and leverage ratio. During the quarter, we entered into new EUR-denominated term loan facilities with an aggregate principal amount of EUR 255 million and obtained EUR 460 million increase of our existing EUR-denominated revolving credit facility. We drew a total of $581 million under a combination of these new term loan facilities and existing term loan and revolving credit facilities. Of that amount, $296 million was drawn under the revolving credit facilities on May 6th, 2026, remained outstanding as of quarter end, and has since been repaid.

Speaker 3

After the end of Q2 2026, we entered into additional EUR-denominated term loan facilities totaling EUR 590 million and obtained increases of EUR-denominated revolving credit facilities for a total amount of EUR 30 million. Also, we sold 39.6 million primary shares at $29 per share in our initial public offering in July. Net of underwriting discounts and commissions, this raised a total of $1.10 billion. The primary shares issued in our initial public offering will be reflected in our basic and diluted shares outstanding as of Q3 2026. Now to guidance. For Q3, we expect revenue to be in the range of $733 million to $745 million, and for adjusted operating income to be in the range of $380 million to $400 million.

Speaker 3

For the full year, we expect revenue to be in the range $2.78 billion to $2.82 billion, and for adjusted operating income to be in the range of $1.46 billion to $1.51 billion. This guidance is based on the set of businesses we own today and doesn't incorporate any contribution from future acquisitions. Specifically, it doesn't include any contribution from the pending Airtable acquisition, which we expect to close before the end of the year. With that, we are ready to start the Q&A portion of the call.

Operator

Thank you. As a reminder, if you wish to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. For the benefit of all participants on today's call, please kindly limit yourself to one question and one follow-up so that everyone can ask their questions. Thank you. We are now going to proceed with our first question. The question comes from the line of Eric Sheridan from Goldman Sachs. Please ask your question.

Speaker 4

Thanks so much for taking the question, and congrats on the inaugural earnings report. Coming back to the Airtable acquisition, maybe just a few parts. Do you have an expected close date? The second part of it maybe when you think about the historical financials of Airtable, where do you think the biggest opportunities sit to continue to grow ARR and/or improve the operating margin of the company post-close? Thanks so much.

Speaker 2

Thanks, Eric. Luca Ferrari here, co-founder, CEO at Bending Spoons. Welcome, everybody. Regarding the closing date, we do not know. We are expecting the transaction to close this year, but it is difficult to be more precise. In terms of the opportunity we see with Airtable, I will start with the strengths. We believe that the brand and the product are really good, and importantly, they serve a critical use case for organizations. Airtable is used to collect, manage data, and build applications that are used across teams and departments. It is often at the center of how companies that choose to adopt Airtable operate. As such, we believe offers a strong foundation for continued growth and value creation. Specifically to your question, we are excited about both the ability to keep growing the top line.

Speaker 2

We believe that there is significant untapped opportunity to continue expanding within existing accounts and acquire new customers. We look forward to working with the Airtable team to help turbocharge that. We also believe that there are opportunities for operational efficiency.

Speaker 4

Great. Thank you.

Operator

We are now going to proceed with our next question. The question has come from the line of Lloyd Walmsley from Mizuho. Please ask your question.

Speaker 5

Thanks. Two questions if I can. First, just going back to Airtable, how much of a shift is this in the sense that it's growing significantly faster when you're acquiring it than prior deals? Is there really an opportunity to really find really attractive businesses like this, given the environment we're in with a lot of privately funded software companies that are looking for a home, that are still high quality but struggle to raise money? Is this like a groundbreaking example of the environment we're in? The second one would just be, if we think about the enterprise value you've acquired year to date at about 3.5, I think that's about where we were for the full year.

Speaker 5

Is there room to do more this year or should we assume the big ones are largely behind us for this year in terms of the future of M&A? Thanks.

Speaker 2

Regarding the growth profile for Airtable, I think it's a little bit of a false myth that we have only acquired more stagnant businesses. We are neutral on the growth profiles of the businesses we acquire. Obviously, we'll tend to pay a higher price for growth in businesses, but we are happy to buy businesses that have been growing, and we expect to continue growing faster, grow more slowly, stay flat, or even occasionally shrink. Of the businesses we have acquired so far, several were growing nicely. WeTransfer, komoot, Remini back in the day, Tractive recently. So it's not all that new to us. But yes, it's of course, great news when we can acquire a business with plenty of growth ahead if the price is reasonable. Regarding the ability that we have to continue doing acquisitions going forward, I think only time will tell.

Speaker 2

We see the environment as favorable. We have capital to deploy thanks to both the IPO and recent debt raises as well as our continued cash generation. We have operational capacity, although certainly, with Airtable, assuming it closes in the next few months, we will be at 5 businesses acquired in the trailing 12-month period, which is, let's say, toward the higher end of what we generally feel ideal for us. We have more capacity to do a little bit more if the appropriate opportunity presents itself. We are positive our pipeline looks probably as good as it ever has, to be honest. Yep. We will see. M&A remains an opportunistic endeavor, so it is impossible to be 100% certain what will happen.

Speaker 5

All right. Thank you.

Operator

We are now going to proceed with our next question. The next question comes from the line of Doug Anmuth from JPMorgan. Please ask your question.

Speaker 6

Thanks so much for taking the question. I just wanted to ask about the recent Tractive acquisition and just the fact that it is one of your first deals that has a hardware component. Just curious how you are thinking about hardware-enabled businesses and where that has a place in your M&A philosophy going forward. Thanks.

Speaker 2

Thank you for the question. In general, almost everything we do at Bending Spoons is aimed at trying to maximize the probability that we can fully realize the ambitions we have for this company, which is a massive ambition of growth over the very long term. With that in mind, expanding our addressable market many years before it becomes a constraint is important. We shared in our perspectives that we found approximately 1,000 digital businesses that we think could become attractive acquisition targets over the next several years. They aggregate to approximately EUR 400 billion in estimated revenue for 2025. By the way, there is growth overall in this sample, so presumably, the size will be a little bit bigger in 2026. We think that's a huge addressable market, and that's fully digital stuff. Becoming world-class at almost any difficult thing takes a while.

Speaker 2

Once we found Tractive, where we think you win primarily through the digital experience and where monetization is primarily through subscriptions areas that we understand, I would believe really well, yet where hardware was a part of the overall equation, we jumped at it. We saw a wonderful company with a very good opportunity ahead of itself, and at the same time, the added bonus of being able to train our muscles when it comes to, in this case, the consumer hardware. That was the thinking behind it. We are extremely happy with the acquisition so far, and we're finding that although clearly we have limited experience with hardware, we are already finding ways of providing value. We're learning a lot from the team. The market for businesses that have a hardware plus software component is massive, clearly.

Speaker 2

Maybe in time we'll be able to do more in this, let's say, adjacent area. So far so good, but of course the jury is still out.

Speaker 6

Thank you.

Operator

We are now going to proceed with our next question. The question comes from the line of Stefan Slowinski from BNP Paribas. Please ask your question.

Speaker 7

Yes. Thank you, and congrats from me as well on the first quarter. Just wanted to ask about the organic growth in the quarter of 3%. I believe it was down from 6% in Q1. Just wondering if the underlying business, if that's in line with your expectations. Then the follow-up would just be if you're seeing any accelerating AI impact on the portfolio today, whether it be in terms of disruption in those markets or whether it be in terms of opportunity from a product standpoint or a pricing standpoint. Thank you.

Speaker 2

Thanks. Regarding the 3%, it came in a little bit higher than we expected. The close was a little bit higher than we expected. The largest contributors, as we included in our disclosures, were WeTransfer and Tractive. Remini and Splice were the negative contributors. Obviously, as we recently added AOL, Eventbrite, and Vimeo, which in aggregate grew in the low single digit, that also affected the overall growth rate of the company. So that's the short explanation for the 3%. Obviously, the blended growth rate will depend each time on the composition of our portfolio at that point in time, the performance of individual businesses a year prior. Sometimes a business may be doing well but had an especially good quarter a year prior. It will depend on the sequencing of monetization improvements, which can also influence blended organic growth rates substantially. Anyway, that's at 3%.

Speaker 2

Taking a step back, I think this is a good opportunity to reiterate. We talk about this in our perspective, but I'd like to reiterate on how we look at organic revenue growth. Our goal, and I mentioned it a few minutes ago, is to maximize shareholder value, the success of this company 10 years out. That translates into trying to compound revenue and operating income, earnings per share on a per-share basis, including revenue and operating income, as quickly as we can. We are pretty much neutral when it comes to the underlying characteristics. We're happy to do it at any particular organic growth rate. We're happy to do it at any particular margin structure within reason. We believe that's the, say, mathematically sound way of approaching creating shareholder value.

Speaker 2

Sometimes, as we approach our M&A activities with that objective in mind, we find that the best return opportunity is in a slow-growing business, such as AOL, an acquisition we are actually extremely happy with. Like I said, growing low single digit. We think actually a much better business than people realize. Even sometimes shrinking businesses. If the IRR is what it needs to be, we are happy to pick those up. Equally, if we find that great returns are promised with fast-growing businesses. You mentioned, not you specifically, but one of your peers mentioned Airtable a moment ago, and I mentioned Tractive and komoot as other examples of fast-growing businesses we have acquired somewhat recently. We are happy to get those done as well.

Speaker 2

Organic revenue growth will just be an output of our capital deployment activities, and it could be higher or lower, and it is not something we particularly focus on and certainly not something we optimize for. Regarding AI, we have not seen, say, any noticeable disruption in any of our businesses, really, because of AI, I think at least none of the significant ones. I think you could make an argument, I am not entirely convinced, but I think you could make an argument that Remini's decline could be connected to progress in AI. Frankly, we see that Remini's existing users and customers continue to behave exactly as before. We have not noticed any change in behavior. It is just that acquiring new users and customers was particularly challenging for that business in recent quarters. We believe it is mostly due to saturation in the market.

Speaker 2

Ultimately, this is a market that was born only a few years ago, automatic generation of image and video content, and a lot of progress has been made by us and others. It is more difficult now to come up with novel ideas, and a lot of Remini's growth was driven by, let us say, viral spikes or with major innovations, and we were able to attract new users in droves here and there. An unusual pattern, by the way, I would say Remini is the only one business in our portfolio where customer acquisition was spiky. All of our other businesses of any significance are perhaps much more boring, but also much more predictable in that the acquisition comes from word of mouth, and it is quite steady over time.

Speaker 2

I think mostly it is saturation, but I think it is a reasonable argument that one could make that because it is now more commoditized, the generation of content, especially image, but also video content through AI, competition has intensified, and therefore, while this has not apparently impacted the behavior of our existing users and customers, has made it more difficult or expensive to attract new users and customers. So that is the only area of our business where I think potentially AI has had a negative impact. Other than that, we have not seen anything whatsoever. In terms of upside, I am probably not saying anything shocking here, but we are seeing massive opportunity in terms of operational efficiency. We mentioned our recent internal release of a tool called Alt-Spooner, like Alternative Spooner. It is a pretty wonderful technology in my view, that enables people to be superhuman in their productivity.

Speaker 2

I'll give you an example. Quite recently, I was in a Slack channel with one of our general managers. She leads Evernote, specifically. This channel is meant to be a place where we provide feedback on how the product could be improved. This person posted by asking Alt-Spooner, because you talk to Alt-Spooner as if it were a colleague on any company channel. She asked her Alt-Spooner to investigate a bug she had noticed and check with our internal technologies. There's one called Moros that enables tracking customer support tickets for product insights. She asked her Alt-Spooner to look for this bug, if it had been reported by other customers. If we could conclude it's a prevalent bug or just something extremely rare that she encountered.

Speaker 2

Assuming that the answer was this has been reported by others, she asked her Alt-Spooner to investigate the root cause in the code, program a fix, and then reach out to Evernote's tech leader, asking that he review and hopefully approve the pull request so that the bug can be fixed and pushed to production. I witnessed this. This was the first time I saw Alt-Spooner in full force. In a matter of probably, I don't know, 5 minutes or something like that, 5 or 10 minutes, all of these tasks had been completed. The only reason why the bug was fixed the day after is because the technology leader was not checking his Slack at that particular point in time, which maybe we can improve on that too.

Speaker 2

It is mind-blowing because this is a process in the past would have taken optimistically a week and probably a few tens of person-hours, and was completed in maybe, I don't know, like half an hour by Spooners, real humans. That's an example where our operations have really picked up in efficiency thanks to AI. There are many more, but this hopefully makes the case. In terms of, let's say, the more visible ways AI can be helpful, of course, you can serve customers better through AI. Most of our product work, I would say most is probably accurate to say. Certainly a big part of our product work across our portfolio over the past maybe 6 months or so has been focused on AI-related or even AI-centric functionality. I'm thinking at Brightcove, we introduced auto-translations, audio track dubbing, live captions in 50-plus languages.

Speaker 2

It's all basically done with AI. This was a transformative feature for our enterprise customers. We introduced a content multiplier, which enables content organizations, media companies to take their high-quality content and produce all sorts of alternative formats, shorter versions, highlights they can post. It's just a few clicks, which makes them a lot leaner, faster, more successful. We introduced recommendations so that if you're a media company using Brightcove, once a user of yours, your audience has completed watching one of your videos, then you can enable recommendations, like YouTube a little bit. These are now very smart, and we saw improvements in viewership for our customers ranging between 20% and 40%, which obviously is a game changer for a media company.

Speaker 2

Again, just to stay on Brightcove, I'd rather go a little bit deeper on one or two businesses than provide you a quickly and shallow touchpoint on all. But we introduced in the back end, so basically the part of the product that the administrators and actual users on the customer side of things use to then reach their audience, their viewership, we introduced all sorts of agentic functionality. You can now use an agent to perform previously menial and cumbersome tasks, such as reordering videos and organizing things, finding videos. We have created a much more advanced layer for developers so that you don't necessarily have to go through the pretty good API that we had in place, but you can use an MCP to basically skip that and let your AI agents operate with Brightcove effectively.

Speaker 2

The list is long, but generally speaking, what I just described for Brightcove would apply with the due adjustments to probably 80% of our businesses. It's exciting. I will say it's still unclear, and I don't think this is a Bending Spoons thing, I think this is almost any company thing, exactly to what extent these AI-enabled features translate into incremental revenue. Certainly, we're seeing uplift here and there, but I wouldn't say we've seen massive uplift where all of a sudden a customer who was paying, say, EUR 100 is willing to pay EUR 200. Maybe they're willing to pay EUR 110, which is good, but not transformative. The good news is that none of our strategies is in no way predicated on that being the case, but we'll keep an eye on it, and we'll let you know if things change.

Speaker 7

Really appreciate that. Thank you.

Operator

We are now going to proceed with our next question. The questions come from the line of Kirk Materne from Evercore. Please ask your question.

Speaker 8

Yeah, thanks very much and thanks for taking the question. I guess my question would be, with Airtable adding some enterprise sales motion to a portfolio that's traditionally been a little bit more weighted to consumer and self-service subscription businesses, should we view this as a bit of a shift in your M&A philosophy towards more enterprise? Or is this just one example and obviously a very big M&A pipeline you all have? I am just kind of curious if there is any kind of longer-term shift we would expect to see you all go a little bit more towards enterprise, just given maybe the machinations in the M&A market right now. Thanks.

Speaker 2

Thank you. Great question. Even before Airtable, we are serving many more businesses than people necessarily realize. We believe it is difficult to draw a precise line, but we believe that approximately 50% of our revenue comes from consumers and about 50% from professional businesses, enterprises. Again, it is difficult sometimes to know how big a company is. You do not always have the precise data, but I think that is directionally accurate. It is just that some of the more well-known brands we own are consumer brands. Consumer brands tend to be better known in the market for obvious reasons. I think that is why people think about Bending Spoons as primarily consumer, but it is not as skewed toward consumer as people think. Having said that, there has been a shift over time. We acquired Brightcove in early 2025.

Speaker 2

We acquired Vimeo in late 2025, which has a big enterprise component to it. We signed the acquisition of Airtable, which is primarily enterprise. We have not shifted toward enterprise because of a thematic view. Our guiding principle is to take every EUR we have available, whether it is free cash flow or prudent levels of debt, or opportunistically, could also be equity, and we have done that occasionally, and put it to use in the most efficient way possible to try to generate as much value for our shareholders over a window of maybe 10 years, very long-term.

Speaker 2

We focus on being as good as possible, that perfect operating machine when it comes to running these businesses, because that is how we can pay attractive prices and prices that are attractive to the sellers, and at the same time, deliver the high returns I believe we have consistently over time. So that is the part we control and how we think about things. The rest is really what the market offers. In our view, most enterprise SaaS businesses were valued at irrationally high levels until somewhat recently, where we do not-- again, it is just our view, but at least looking at these businesses through the lens of someone who is trying to make money through free cash flow over the long run, rather than speculating on reselling at the same or a better multiple. We never saw those prices as making any sense.

Speaker 2

Whatever the reason, as the market has shifted and prices are now more reasonable, sometimes still high, in my view, but overall, I'd say more reasonable. We're finding more opportunities to acquire some of these businesses, which can often be wonderful. I think Airtable, we have plenty of respect for Airtable. We think it's an absolutely wonderful business, and there is a very competent team there at prices that are appealing. So I think if the boundary conditions remain similar, as in valuations remain similar, you'll probably see us do more of this sort of thing, but not because we like it more now than we did 2 years ago, simply because considering the price now, it's more reasonable for us to achieve really high returns.

Speaker 8

Thank you. Helpful.

Operator

We are now going to proceed with our next question. The question's come from the line of Alex Zukin from Wells Fargo. Please ask your question.

Speaker 9

Yeah. Hey, thanks so much. I appreciate the question. I think you started increasing AOL prices for customers at the end of June. Could you quantify the magnitude of the price uplift and help us understand how customers have responded to the increase thus far? Thank you.

Speaker 2

Thanks. Thanks for the question. We run experiments not just on prices, but dozens of different variables across all of our properties at all times. Last year, we ran, I believe, 3,000 or 3,500 experiments probably, or 10,000 throughout our history. If you could pick pretty much any one of our businesses and products, and almost at any particular point in time, you could find someone with whom we're experimenting on new prices, new feature sets, new experiences, new let's say structures of free versus premium features, and so on and so forth. That's just for context for those who don't know necessarily Bending Spoons all that well. We try to run our business as a scientist would, and a big part of that is being experimental.

Speaker 2

Now with AOL, it's true, we have been experimenting with a number of things, including pricing, and it's too early to draw definitive conclusions. We'll share any such conclusions once we have them. But so far, we're seeing promising responses across multiple different configurations in our experiments. Stay tuned. Thank you.

Operator

We are now going to proceed with our next question. The question's come from the line of James Heaney from Jefferies. Please ask your question.

Speaker 10

Excellent. Appreciate you having me on. It'd be great if you could talk about the progress you've seen out of Eventbrite. Curious what specific changes you've made since acquiring the asset and how that's impacted metrics like usage, revenue, profitability. Thank you.

Speaker 2

Yep, sorry, here I am. I was on muting.

Speaker 10

No problem.

Speaker 2

Yeah, thank you. Eventbrite, very recent acquisition. Closed it in March, a few months ago. Very happy with it so far. I would say it's lived up to our expectations, maybe exceeded our expectations a little bit, overall. We completed a deep reorganization of the company. We published that news a few months ago, which we believe was important to set things up for long-term success. We have a leaner team that we think is better positioned to progress rapidly now on both technology and product. From there, monetization. We have shipped around 40 improvements on the product. There is an interesting blog post I think people can go and check, that details a significant number of these 40 improvements. I'm not going to go through all of them, because I don't think a lot of the audience here is a ticketing geek.

Speaker 2

I would say that the overall angle is we spent a lot of time with customers and collected a long list of pain points. Some small, some bigger ones, and we just got to work aggressively solving these problems. We improved the reliability of the entire platform. There were issues with loading times and bugs. Just one of countless examples now. If you create an event, loading times are roughly 40% faster. So for people who create hundreds of events over a year, that's a very nice improvement. We improved creator tools. There's now all sorts of new functionality to manage. If you're an organizer, your checkout is a critical moment of the ticket sale experience, obviously. We have improved event discovery in different ways. Among others, we have completely redesigned the profile page for creators. On and on.

Speaker 2

I really recommend taking a look at the blog post. In general, you can follow us. We try to make sure that each of our businesses, at least the main ones, publishes important or significant product improvements so that people can keep an eye on our work. But we're quite excited about the amount of work that we have done, considering just how recently we acquired it. That was product. We managed to improve monetization from advertising by approximately 20%. Advertising is a smaller component of Eventbrite's overall revenue, but that 20% improvement still translates into low single-digit growth. It's nice. It's good for organizers too, because essentially the service here is that we're helping them get more visibility for their events. We managed to lower paid user acquisition spend by approximately 30% without impacting any, let's say, top-of-funnel metrics.

Speaker 2

We found different pockets of unprofitable expenditure and got rid of those. Then we migrated the back end to a more modern infrastructure. We're rewriting all the, let's say, underlying core components. We believe this will be important as we look to accelerate product innovation and also our ability to iterate quickly on the different aspects of the user experience and monetization. I think an exciting start. We'll see. I believe we'll have something more substantive to show over the next few quarters. Still a bit early, but so far so good.

Speaker 10

Thank you.

Operator

We are now going to proceed with the next question. The question's come from the line of Umar Oyesaki from Bank of America. Please ask your question.

Speaker 11

Hi. Thank you. I'd like to double-click into AOL and specifically your comments around advertising. You said that advertising was ahead of your expectations, and I was hoping you could give a little bit more color as to why. For example, was it related to the market? Was it something that you did to the assets or the technology? When you say it was ahead of your expectations, did it grow or was it down, for example? If you could just give us some more color around what happened there, we'd appreciate it. Thank you.

Speaker 2

Sure. Thank you for the question. Yeah, it did grow. I don't think we can take, certainly not for it, some credit, but not full credit. Some of it is just probably fortunate fluctuations in some of the underlying phenomena. With advertising on AOL, we have a pretty ambitious plan and we believe that step 1 is creating the appropriate foundations, modern foundations, so that we can max out advertising. It's a pretty long discussion, but I think it can be reduced to essentially two branches. On one hand, we need to greatly improve our ability to serve interesting content to our users, particularly on the web portal. For emailing, that's really up to all of us sending interesting emails, so please try harder.

Speaker 2

With the web portal, we have a lot of leverage, and we want to make sure that we improve the selection of content, the recommender system, so that people find it more pleasant to spend time on the portal. There's tens of millions of people who are very loyal users of that portal. That alone, we could talk about it for a long time. I think one of the interesting opportunities is to use modern technology and AI to find better recommendations for people. We're working on that. We completely rewrote the content management system, like 100% rewritten from scratch, and that will be one of the building blocks for this future optimization.

Speaker 2

The other big branch of optimizing advertising revenue, because that, what we just described, hopefully, would give you engagement and retention, and then the other part is to actually select inventory properly, and that's more ad tech. For that one, we also completely rebuilt the advertising technology stack from scratch. We are now in the process of deploying it step by step gradually because it's a risky change. We incorporated some revenue disruption in our guidance precisely for this reason. Even if we do it perfectly, we believe there will be some revenue disruption. Clearly, we believe this is ultimately very net positive in the long run, but it could be slightly negative in the very short run. That's the overall approach. We remain at least as excited about AOL as we were when we acquired it. It's a really nice asset.

Speaker 11

Thank you.

Operator

We are now going to take our next question. The question comes from the line of Yi Fu Lee from StoneX. Please ask your question.

Speaker 12

Thank you to the entire Bending Spoons management team for taking my questions, and congrats on a very strong start as a public traded company. Luca, in the beginning of the conversation, you spoke about sustainability of the business model, and I think that's the biggest investor pushback we receive in the market. You addressed it by pipeline, talent, Spooners, and capital financing, right? Since 2023, management has generated exceptional acquisition returns. My question for Luca and team is, what gives you confidence that Bending Spoons can continue generating similar returns at significantly larger scale? What role does the proprietary operating system play in maintaining that advantage versus traditional players like private equity firms, software acquirers? You talked about Alt-Spooner earlier, but just want to get your take and double-click on this topic. Thank you.

Speaker 2

Thank you. Yeah, it's a critical topic. What we know is that our returns have not so far deteriorated, at least not in the last. Maybe acquisitions we did 10 years ago or tiny acquisitions did even better. But at least in the last three, four, maybe even five years, we haven't seen a deterioration of returns. If I were an investor, I would assume returns will deteriorate in the future, although we haven't seen any such deterioration simply because if we keep compounding at the current rate, you guys have seen we just posted another triple-digit growth quarter, and it's a long lease at this point, a long sequence. This is so much faster, to our knowledge, than any serial acquirer in history, but by a mile.

Speaker 2

It's just reasonable to expect that there will be some deterioration in the growth rate, although we haven't seen any signs of it yet. The good news is that even if we were to grow a lot more slowly, it may still be incredibly fast by almost any measure. There's plenty of room for deterioration to occur while still things being extremely exciting in our view from a capital allocation and investment perspective. Of course, we do everything we can to achieve the highest possible returns for as long as possible. In fact, we don't think about it as in how do we avoid any deterioration. We think about it as in how can we make things even better. It's not written in the stars, and we can't find further pockets of improvement.

Speaker 2

We believe the overall addressable market is large, and we have not yet found that larger companies offer an inferior opportunity for optimization. The level of improvement we've been able to bring, whether it's product, technology, team, monetization at some of the larger acquisitions, is comparable to the one we were able to bring to smaller acquisitions. The financial results we've achieved so far appear to be in line with those previous acquisitions. There doesn't seem to be a phenomenon necessarily where bigger means more difficult or worse. Probably more difficult, yes, but we also get better at what we do. Our resources increase. That's advantageous. We believe there's plenty of capital out there, although we are not, of course, guaranteed to be able to access it. But hopefully we can continue to serve our investors, both lenders and shareholders, at an excellent level.

Speaker 2

Plenty of people who want to participate. We hope that capital does not become a bottleneck in the next several years. Operational capacity is certainly a potential bottleneck. We are doing fine right now, but as we mentioned in our remarks, we cannot rule out the possibility that from time to time, we may need to slow down to be able to hire more people and coach more people. At the moment, we're still seeing a pretty significant ramp-up in terms of our ability to attract new talent. We're just expanding in London, opening in Madrid and Warsaw. We may be expanding in other geographies in the near term, and that means tapping a potentially much, much larger talent pool. We still have plenty of room for increasing compensation. With this quarter, we have exceeded EUR 4 million per Spooner on a run rate basis in terms of revenue.

Speaker 2

We try to set our compensation levels in an efficient way, but if it means being able to attract a lot more great people, we could easily raise compensation in a major way without critically impacting our overall economics, and that supposedly should help us find even more great people. Yes, the technological aspect of things remains a key focus for us. I would believe we're just scratching the surface of what we can accomplish, particularly with AI, which is changing the rules of the game. As far as we can tell, we are at the very cutting edge of using AI in our operations. We have yet to see a company that does it better. I'm sure there is someone out there. But we're pretty confident we're among the best in this area at a minimum. Are we certain we're not going to see deterioration?

Speaker 2

No. Would I recommend an investor, a prudent investor, to assume we don't see our returns deteriorate? No, I would say, stay prudent, assume some deterioration. But do we see, as of now, signs of such deterioration happening? We don't, and we are as excited as ever to keep pushing.

Speaker 12

But Luca, let's say if a deal market deteriorates. Becomes less favorable, let's just say. If you just patiently wait, the portfolio technically should generate higher cash flow, consistent cash flow. Would you patiently de-lever the balance sheet if that's the case? That's it for me. Thank you very much, Luca and team.

Speaker 2

Sure. Thank you. We try to optimize our capital structure for maximum returns while keeping a risk profile that we consider very prudent. At all times, we try to keep the perfect amount of leverage. Obviously, it's not like there's an element of judgment there. We disclose that our leverage ratio is around 2.4 times as of the end of the reported quarter. We think that's an appropriate level of leverage. It could go up a little bit or go lower a little bit over time. Naturally, if we were to pause acquisitions for whatever reason, at some point, you would presumably see our leverage ratio decline quite rapidly. If we found particularly exciting opportunities for generating high returns for our shareholders, you may see our leverage ratio go up a little bit. But I don't think you'd see it go up dramatically for sure.

Speaker 2

Basically, we just try to be mathematical overall in maximizing the rate of compounding, and a significant component of that equation is picking the right sources of capital. It's interesting now that we're a publicly traded company, there are interesting things we can do with our equity, which we will be exploring in due course as opportunities arise. Every decision you see us make will be aimed at maximizing long-term returns while keeping risks at what we consider a very prudent level. Thank you very much.

Speaker 12

Thank you, Luca Ferrari and team. Congrats again.

Operator

Thank you. There are no further questions at this time, so I will now hand back to the management team for closing remarks.

Speaker 1

Thank you for joining us. We look forward to speaking to you again next quarter.

Operator

This concludes today's conference call. Thank you all for participating. You may now disconnect your lines. Thank you.

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