00:00Look, it looks like costs are going to be higher. Can I assume, or can investors assume, that revenue will
00:07rise to match or exceed those costs?
00:11Of course. Of course. And that's what we have demonstrated for the past years in a consistent manner.
00:18Over the past years, we have consistently under-promised and over-delivered.
00:23Over the past years, we have consistently revised the cost guidance done in the course of the year.
00:28We are building a company based on one single bedrock, which is credibility, and we are investing to grow the
00:36company.
00:37The company grew for the seventh quarter double-digit, double-digit growth in top line.
00:44The performance of last year was double-digit growth again on top line, on EBITDA, and on EPS.
00:50So, for sure, what we are investing, what is increasing our cost base for the year to come, is just
00:56about, A, we have acquired admin control last year,
00:59and we have acquired ATEX in Greece, and we are growing to deliver our organic growth programs.
01:05So, this is something that will feed the growth of the company.
01:10And not everyone is focusing on the expansion of a cost base, but don't forget that we are delivering, with
01:16a cost base that is expanding,
01:18a 62-plus percent EBITDA margin.
01:22So, growing the cost base, if you grew double-digit top line and EBITDA, and if you deliver a 62
01:29percent EBITDA margin, is a good way to invest.
01:34Stefan, over the last few days, investors have become nervous about financial services companies.
01:39They're worried that AI is going to disrupt this business model.
01:43It's interesting that Elliott has taken a stake in LSEG, and one of the things they want is LSEG to
01:48educate investors that, actually, AI is an opportunity, not a threat.
01:54Is AI an opportunity, not a threat to Euronext?
01:57How do you see it playing out when it comes to your business?
02:02Well, I don't want to comment on the LSEG situation.
02:04LSEG is a great company with a great leadership that has undertook an amazing transformation over the past few years,
02:10and it's the largest market cap in our industry in the European continent.
02:14So, that's another issue.
02:16As far as AI is concerned, we are in a totally different situation vis-à-vis our peers.
02:21We did not buy data assets over the past five years when everyone was buying data
02:27and when the common song in town was, data is a new oil.
02:32We did miss the data boat because we did not buy data.
02:35We are just finding out that maybe the data boat is turning out to be a Titanic boat.
02:40We did not buy data assets just because they were far too expensive on the basis of the way we
02:47measure return on capital employed.
02:49And we believe that there was no way to justify the price to be paid for those data assets.
02:54It turns out that over the past few months and weeks that there is a sort of wake-up call
02:59and people realize that some of those data assets, not all of them, but some of them are dislocated by
03:05AI.
03:05We are in a different situation.
03:07AI does process information that already exists.
03:12AI is a tool for derivative processing of information.
03:16What we do in our data business is to create things that do not exist until we create them.
03:22That is pure primary data, and this is the price.
03:25The price is the output of bid and ask matched in a matching engine.
03:31Until the bid and ask match in a matching engine, this information does not exist.
03:36It is not digitalized.
03:37It cannot be captured and processed by AI.
03:40That is why what used to be perceived months ago like raw data is in fact a primary data immune
03:47from AI inference.
03:49So that's why we are not affected in any way whatsoever by AI for the sake of dislocation of the
03:55data business.
03:56What is true, though, is that we are capturing big time the AI opportunity on the cost base of the
04:02company.
04:03Okay.
04:04Stefan, you do rely, and the business model relies partly at least, on pretty concentrated liquidity.
04:11Does AI fragment that liquidity?
04:16No.
04:17I mean, again, we need to be clear.
04:23Price formation, and I don't want to spend too much time on that because only 40% of our top
04:28line is volume-related,
04:29and only 17%, 1-7% of our business is cash equity trading.
04:34But even if it is 17% of our top line, it captures 70%, 70% of the bandwidth of
04:40questions,
04:41and that's pretty understandable in the current environment.
04:44Fragmentation is the sickness of any market.
04:49Consolidation of liquidity is the solution to create high-quality prices.
04:53AI is a tool that empowers market participants to augment, to enhance their algo trading,
05:01and to make their strategy more sophisticated.
05:05But when it comes to price formation, the very fundamentals of price formation are concentration of liquidity
05:12to create high-quality spreads in the matching of Edenask.
05:18Stefan, I speak to a lot of startup CEOs, a lot of tech CEOs, almost none of them.
05:23None of them say they're going to be listing in Europe.
05:26What are you getting wrong?
05:29Well, I mean, they make their choices the way they want.
05:33I think it's a very London-based perception.
05:35We have created a platform with a single...
05:39No, I speak to European CEOs.
05:41No, no, no, no, I'm sorry.
05:42I speak to European startup founders.
05:44It's an indictment, isn't it?
05:45Let me, let me, let me...
05:47No, let me, let me, let me answer your question.
05:50The reality is that we have built an exchange with an aggregate market capitalization of companies
05:57listed in Eonex, which is 6.8 trillion, which is more than twice the size of the London equity market
06:03and three times the size of the Frankfurt market.
06:05What are the consequences?
06:06We got one of the largest IPO just a few weeks ago, a Czech-Slovak company, a company from Prague
06:12that had plenty of options.
06:13They have decided to list on Eonex and they have a 30 billion market cap.
06:17Another company in the aerospace and defense sector, KNDS, is going to get listed and they
06:23will be listed on Eonex.
06:25So the reality is that we have a pipeline of tech companies and aerospace and defense
06:29companies that list on the Eonex market, which is significantly higher than the ones that
06:34they can find, at least outside, because the other European markets are small and the
06:39other, the only liquid, large liquid markets they can find are Nasdaq and NYSE.
06:44So we are in a totally different situation.
06:47That being said, you are absolutely right.
06:48Europe needs to consolidate more equity markets.
06:52Europe needs to consolidate more equity markets because our local equity markets are too small.
06:57Well, let me ask you that question, then, to wrap things up.
07:00We talked about this before.
07:02Just back to the Elliott point, Elliott would like LSEG to review its portfolio.
07:06Have you, would you talk to Elliott about maybe thinking about acquiring the London Stock Exchange
07:13and splitting those two businesses off?
07:14Have you had a conversation?
07:16Would you talk to Elliott about that option?
07:20We do not talk to Elliott.
07:23We have no intention to talk to Elliott.
07:25The only body that is empowered to enter into conversations about what they want to do with
07:32their assets are the board and the management of LSEG.
07:35They know that we are available, but we do not intend to have any conversation in any way whatsoever
07:41with activist shareholders.
07:45The right people to talk to are the management and the board of LSEG.
07:49And that's the way we operate.
07:51And we are available.
07:52Everyone knows or focuses on equity markets.
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