Good morning, everyone and welcome to the Globant Q4 and Full Year Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please also note, today’s event is being recorded. At time, I’d like to turn the conference over to Ms. Paula Conde, Investor Relations Officer. Ma’am, please go ahead.

Thanks, operator, and thanks everyone for joining us today on our call to review our 2018 full year and fourth quarter financial results. By now, you should have received a copy of the earnings release. If you have not, a copy is available on our website, investors.globant.com. Our speakers today are Martin Migoya, Chief Executive Officer; Juan Urthiague, Chief Financial Officer. Before we begin, I would like to remind you that some of the comments on our call today may be deemed forward-looking statements. This includes our business and financial outlook and the answers to some of your questions. Such statements are subject to the risks and uncertainties as described in the Company's earnings release and other filings with the SEC. Please note that we follow IFRS accounting rules in our financial statements. During our call today, we will report non-IFRS or adjusted measures, which is how we track performance internally and the easiest way to compare Globant to our peers in the industry. You will find a reconciliation of IFRS and non-IFRS measures at the end of the press release we published on our Investor Relations website announcing this quarter results. I'd like now to turn the call over to Martin Migoya, our CEO.

Thank you, Paula. Good afternoon, everybody, and thanks for joining us today. Happy to be here to review our 2018 full year and fourth quarter performance. At the end of the call, Juan will share our financial outlook for 2019. 2018 was another very successful year for our company. We achieved a robust revenue growth while improving profitability and cash generation. Our full year revenue for 2018 amounted to $522.3 million, representing a 26.3% year-over-year growth. At the same time, revenue for the fourth quarter 2018 amounted to $140.1 million, a new record for the company as an increase of 21.4% compared to the same period in 2017. This remarkable revenue growth was driven by the acquisition of new customers and by the expansion of our deals with current customers. Most of this growth comes from media entertainment, finance, technology, travel, consumer, retail and manufacturing. This expansion across verticals signals that digitalization is reaching more industries. It's opening new opportunities for a pure play company in digital and cognitive technologies, like we are. During the last 12 months ended December 31, 2018, we render service to 373 customers, 90 of which had annual revenues over $1 million compared to 82 one year ago. During the last 12 months, we had 5 accounts above $20 million in annual revenues and 9 accounts over $10 million in annual revenues. We've continued to grow the size of our accounts aligned with of our 50-Squared strategy. Finally, our adjusted diluted EPS amounted to $1.74 and $0.50 for full year and the fourth quarter, respectively. Later, during the call, Juan will share more details on our financial performance and our guidance for the rest of the year. Our sustained growth showed that we are on the right path to address demand and market needs. Companies…

Thanks, Martin, and good afternoon, everyone. I will spend a few minutes taking you through the fourth quarter and full year 2018 results. Then I will talk about our outlook for 2019. Let me start by saying that we're very pleased with our overall results for the fourth quarter and full year 2018. Q4 was a solid quarter of revenues, closing at $140.1 million, 21.4% over the prior year and 4.1% over the last quarter. Disney was, once again, our largest customer for Q4 2018 with remarkable growth. The account experienced a solid year with good perspectives of growth for 2019. Moreover, revenue for our top 10 accounts increased 20% over the fourth quarter of 2017, and revenues for customers 11 and beyond increased 22.5% over the fourth quarter of 2017. Our customer concentration numbers for Q4 remained fairly consistent with past quarters, with our top 1, top 5 and top 10 accounts representing 10.9% , 30.9% and 42.7% of total revenues compared to 10.4%, 28.5% and 43.2% of total revenue, respectively, for the fourth quarter of 2017. Our vertical diversification remain balanced across the different industries, with media and entertainment and financial services leading the pack accounting for 26.6% and 21.8% of revenues, respectively. And we continue to be well diversified in terms of customers and industries. During the fourth quarter of 2018, 77.4% of our customers were in North America. The U.S. as our top country. 13.5% were in Latin America and others, Argentina as our top country, and 9.1% were in Europe, Spain as our top country. During the fourth quarter of 2018, 85.6% of our revenues were denominated in dollars, protecting our top line against currency fluctuations. During the last 12 months, we render services to 373 customers. Our 50-Squared services continues to drive growth, and…

[Operator Instructions] And our first question today comes from Joseph Foresi from Cantor Fitzgerald. Please go ahead with your question.

Hi. This is Drew Kootman on for Joe. I had a quick question on the growth for the top 10 - outside the top 10 clients, it looks like it accelerated while the top 10 decelerated. Could you touch on what you saw in those groups and what you expect moving forward?

Hi, Drew. This is Juan. So, no, overall revenues increased 14.6% year-over-year, and when I look at our top 10 accounts, we saw a 20% year-over-year growth in Q4. And when we look at customers 11 to the end, we see a revenue growth of 22% year-over-year growth. So I think that we saw good growth across the board in our top 1, top 5, top 10 and even 11 to the end accounts. So I'm not so sure which is the number you're looking at.

I was looking compared to last quarter. I think the top 10 accounts, let me see, I think it was growing like 38%?

Look, overall, I mean, we were 21.4% overall in the quarter. I think that, when we look at - I mean, I don't have the number that we are looking in front of me, but overall, we see 21.5% - 21.4% for the all the company, 22% for 11 to the end, and as I said before, 25% year-over-year. So I think it's still very good growth. There's nothing really to worry about. We see -- we continue to see good growth in all of our top accounts, all our high potential 50-Squared names are performing well, in line with our expectations, and we are continuing the role next year.

Okay. Thank you. And then for the Argentina tax, could you go in a little more detail? I know you mentioned 10 to 20 bps decrease in SG&A, I was just wondering, if it all affected anything else? Or just any more detail around that?

Yes, yes. So the new Argentina withholding tax basically has an impact on the exports totally from Argentina. Argentina is now about 35% of our headcount and about 20% of our costs. That part is basically 4 pesos for each one of our exports. In the guidance that we provided both for adjusted EPS and also when I discussed our expectations for SG&A, we are already including the impact of that tax. And I think that, that tax should be around $12 million to $13 million for the year at this point.

Sounds good. Thank you.

You’re welcome.

Our next question comes from Tien-Tsin Huang from JPMorgan. Please go ahead with your question.

Hi. This is Puneet sitting in for Tien-Tsin. So, Juan, you talked about seeing higher revenue per head. Is it more of a function of mix as you diversify away from Argentina towards more on-site, or are you also seeing like-to-like price increases, which is driving high revenue per employee?

Yes, yes, so, with those, we see $74,000 per employee, which is a 3% year-over-year growth. But if you look at the breakdown and you'll probably see those numbers in the percentage that we will post in our IR website tomorrow, you will see that actually the offshore share of the total headcount increased during this year. So this is actually -- this is not a mixed-driven increase. It's actually driven by higher pricing, which is also driven by the demand of the services that we have in our service offering.

Understood. And then one question we often get from investors is potential impact of macro uncertainty on clients' digital spending. Are you seeing any adverse impact on client decision making or spending on discretionary digital projects at all?

Puneet, this is Martin. The overall, I would say, feeling that we have in the accounts, as I mentioned, is that the pipeline is still very strong. I mean, I'm not seeing that macro uncertainty being translated into the forecast or the spending that our customers are planning to do. I mean, this is something that we're seeing now and we're seeing that as the current quarter is going on too. During Q4, maybe a little bit of less of the high, high traction that we had on the previous quarters. But I think that overall, it was pretty stable. And now, I'm seeing the pipeline very, very strong. And in that sense, remember, the digital demand is not coming from the company itself but from their consumers pushing them to the changes or with a threat of changing the brand if they don't like it. So that demand is very strong, it's not based on just cost reduction but on expansion of revenue. So I don't see any change on that demand even the uncertainty that you mentioned. But I feel they are a little bit vertical really. So I feel good about that.

Got it. Thank you.

Our next question comes from Ashwin Shirvaikar from Citi. Please go ahead with your question.

Thank you. Hi, Martin. Hi, Juan. Good afternoon.

Good afternoon.

Hi. Congratulations on the results. I want to start with asking about the growth forecast. So when I look at the 1Q top line growth estimate versus the full year, there is a slower growth on 1Q than the full year, and it seems to be because of the tough comp that you had. But I want to confirm that there are no other factors and also, I missed what you might have said about the Avanxo inorganic impact for the year.

Yes, I will let Juan to cover the Avanxo inorganic impact, I will cover your first question. When you're comparing, we're comparing against a pretty good quarter for -- in 2017. So Q4 2018 is compared against a very good quarter in Q4 of 2017, so the comp is very complicated. But if you normalize that growth, it would be around 25%. If you normalize the growth of the -- of last year and compare the growth of the last quarter, compared with that, you will get about 25%. So if nothing change here, we are getting tough comps even the volatility on our growth rates during last year. So nothing that is connected to the business itself, it's plain execution and pretty tough comps compared to Q4 2017.

And I will talk -- to add on that, Ashwin. We are really happy with the acquisition with Avanxo. We were very interested and we've already seen actually already three contracts that we closed together with them. It's actually brought additional capabilities into the company and our regions and all the business units that we have, have taken this acquisition really, really well, and they are really working in process together. So when we look at Avanxo and considering that there's going to be a lot of -- a very quick integration between the two companies, basically Avanxo is a company which came with about 300 IT professionals, all of them located in offshore locations, mostly Colombia, Chile and -- sorry, Colombia, Mexico and Brazil. So I think if you look at the market with the offshore revenue per se and then you usually [indiscernible] and all that you would probably arrive to a number which is about 200 basis points for the year.

Got it. Understood. And then a question I had was, it's about 6 months since the WPP ownership stake was sold, or since WPP sold its ownership stake. I'm curious as to whether you are beginning to see any sales momentum at WPP's competitors as far as the digital advertising type of services? I know that before they acquired a stake, you used to have good relationships with some of the competitors so can you talk about that market?

No, we didn't change our behavior. Now before, we were trying to get their customers -- they get as part of the family and now we are trying to get their customers as not part of family. So I mean, doesn't change anything. We're not seeing very often WPP competing in the technology space as we are doing with any of their companies. So overall, no impact in terms of the business. And of course, we are not -- we were not being refrained, and we are not being refrained from trying to compete for those customers.

No, I meant competing for, say, business from Omnicom and PGN, companies like that, that's what I meant. Not from...

Honestly, on the customers we have -- and the potential customers that we are competing, we are not seeing them at all. I don't know, this is just my situation right now, maybe in the next quarter we see them. But right now, we're not seeing this.

Okay. Thank you for the update. Thank you. Thanks.

Yes.

Go ahead. Thank you so much.

Our next question comes from Maggie Nolan from William Blair. Please go ahead with your question.

Hi, good afternoon. You guys are talking positively about demand, and you gave a strong guidance for the year, and I know you're coming off of strong pricing and rev per head in 2018. Does this perhaps imply you are expecting higher price increases compared to last year?

I think prices will remain pretty stable during this year. I don't see any upside on that specific side. Yes, we'll continue in our strength to gain more and more efficiency on the SG&A, of course, on our gross margins and looking for efficiencies there as we always do, and as we have been doing since our IPO when we did 32% on SG&A, and this year, we are doing 20% on SG&A. So this is a representation of what we -- of our mentality and how we -- and how we'd like to conduct our business. In terms of pricing, of course, we can always try to increase them and to -- we're better at that. I would not expect it in a consistent manner to happen during this year.

Yes, there is no pricing baked into the guidance. It might be...

Okay. And then, as you look forward to your plans for 2019, how are you expecting that headcount diversification initiative to play out, or how are you expecting to progress against kind of that goal you've laid out of having each location below 25%?

Yes. So right now, we now have our operation in Latin America, which is still the largest operation that we have. Within Latin America, you're seeing Columbia growing very fast, Mexico growing very fast, and then some other smaller countries growing as well. And then you see Argentina growing at a very -- at a much slower pace and becomes smaller as percentage of the total. Right now, Argentina is around 35% of the total. Colombia at 25%, became the second-largest location. And we see LATAM, overall, today, LATAM is overall about 80% of our headcount. We see that going slightly down over time, and we see India, which is right now at 12%, growing to between 15% and 18% over the next two years. And then we have a very small recent operation in Eastern Europe, where we are starting there and we went back to start selling into the headcount map over time. Then the U.S. and Europe, we continue to work to have those two - those locations combined between around 12% of our headcount. So that's overall what we are looking for.

Very good. Thanks and congrats.

Thank you, Maggie.

Thank you, Maggie.

Our next question comes from Avishai Kantor from Cowen. Please go ahead with your question.

Yes, hi. Can you give us maybe an update on the traction in the early days of the Services over Platform offerings? And maybe, you can share some internal goals, which should -- how should we look at revenues, let's say, 2, 3 years from now coming from that platform's offerings?

Yes, I think the traction overall is very good. I mean, we are receiving the customers that we are doing every -- that we are visiting, and the customers that big platform is offering for us is really very interesting. Because once you enter there, you get coverage, I mean, pretty much everybody knows you. And when everybody knows you then doing business inside those accounts it matches your soul. It open doors, it generates more awareness about our brand, and those things are extremely important. In terms of growth of the platforms, last year, it was about 1% of our revenue, and we have the expectations during the next 4, 5 years to -- for that to become about 5% to 10% of our revenues. This is something that we have as an internal objective. It's not something that we will disclose year-by-year. But our objective is for that to become a pretty consistent part of our revenue and our strategy of growth. Because when we enter into an account selling some of the platforms we have to enhance the culture or to change or about the culture or as the digital culture, then the most probable scenario is that they end up buying other things, which are traditional services, and that's pretty foreseeable for us. And it's a very, I would say -- it's an excellent way to handle customers that we have discovered. So where they're happy with initiatives and we will keep on pushing more and more things in our platforms to be successful.

Okay. And then regarding the strong growth that you talk client, is that coming from the Parkside of the business? Is that driven by the studios and media side of the business? Is that a combination? What's really driving that what seems to be very strong growth in the last few quarters?

Yes, last year, these things had a great performance. It grew about 40%, which is pretty impressive for a certain account of this type. We don't expect this in to keep growing forever at 40% a year, so as you may imagine, this is something we need to be very careful about. But this is very healthy, the relationship and now the expansions that they are getting with the acquisitions that they're doing is something that will, in fact, are seen in a very positive. But we need to be careful with that. I think the growth is coming from everywhere. I mean, early accounts, like the one that I just announced, Rockwell, few minutes ago on my speech. Rockwell will be a pretty good account, a pretty solid account in the next few quarters and the growth is coming from hunting and from farming and from many different -- if you see how we are diversified across many industries, you will see that the balance among many different verticals is very good and has been very good in the history. That means that our growth comes from media entertainment, financial sector, several other nature, narrow manufacturing, also from -- well, from every segment that we have breadth in. So you see there like that the common factor there is that their need is across the board. Their need is across the board, the need of the company like Loren [ph] is across the board. So I would not mention a single line or customer or industry that is pushing more than others.

Understood. Thank you very much for the detailed answer.

Our next question comes from Moshe Katri from Wedbush Securities. Please go ahead with your question.

Thanks. How should we think about wage inflation in 2019. I think you have indicated where Argentina is in terms of total headcount. I think we've been waiting for the recent party to kind of continued inflation. Maybe you can talk a bit about that? And then how does this affect non-GAAP EBIT margin? I think the EBIT margin number in Q4 was very, very strong. Maybe some color on that as well? Thanks.

Hello, Moshe. How are you doing? This is Juan. So right now, the company is much more diversified. Hence, Argentina being at 35% of headcount and about 20% in terms of costs. It's now not that of an issue. In the past, inflation in Argentina have -- may have a significant impact in our numbers because we had about 50% or even 70% at the time of the IPO of our headcount in Argentina. But the strategy in personal diversification that we've followed during the last 5 -- 4, 5 years has now put us in a much better situation. Having said that, Argentina is expecting the inflation that the government is estimating for the year is about 25%, which is of course, the highest inflation that we will have across the board. And then for all the other countries, we are talking about single-digit inflation. Maybe, India could be about 10%, but all the other countries are going to be about 3%, 4%, 5% for the year. We believe that we still have room, I mean, currencies continue to depreciate, we realize very strong. So we believe that the impact of certain inflation will be offset by currency depreciation in most countries. And in the case of Argentina, what we have already done was stretching for the first half of the year, basically selling dollars forward, so we are covered for the first half of the year in the case of Argentina.

So what sort of FX tailwinds are factored in your guidance for the year in terms of percentage points?

No, we don't have any more tailwinds there. What we have is basically, the assumption is that FX, whatever happens with the FX is going to be offset by currency -- sorry, by inflation. So net-net, we expect not to have neither benefits nor headwinds coming from FX on our margin.

All right. And the non-GAAP EBIT margin for the year?

The number -- what I guided was 38% to 40% gross margin, and I also guided about 19.8% to 20% SG&A. So that minus our D&A, which is why we're in the same range where we are today. We give you your operating margin number. If you do the math, it should be about 16%, something like that.

Okay, understood. Last question, Martin was talking about this, I think last year. You have been looking at expanding more into Europe, and it's been an initiative that's been kind of a multiyear initiative. Where are we in that ongoing effort?

I think we're in better shape. The difference in countries like Spain and England have propelled a lot now. We have also the inclusion of another delivery center in Eastern Europe. So we are pertaining to cover that in a really efficient way from those centers in Eastern Europe, and the business restructuring very well, I would say, in 3, 4 countries in Europe. So revenue is growing in a pretty healthy way. The engagements and the quality of engagements are really surprising in terms of what we are reporting to our customers. So right now full transformations and full -- like you cannot make additional transformation if your culture is wrong. So at some point, if you want to do additional transformation, you need to change your culture to change the whole thing. So we have seen those kind of engagements, where we can help those organizations to transform the culture, to do the additional transformation, to take them to the next level in a much more holistic approach than in other regions. So we're really very well surprised and very happy with the performance of our European.

Great. Thanks.

Our next question comes from Frank Atkins from SunTrust. Please go ahead with your question.

Thank you for taking my questions. Wanted to ask first, nice progress on the cash flow conversion. Can you talk about a little bit how far there is to go on that and what are your goals for cash flow conversion improvement as well as CapEx going into this year?

Yes, thank you for your question, Frank. Yes, I mean, free cash generation was probably one of the highlights of 2018. Free cash to net income is about 75%, and free cash flow to adjusted net income is about 61%, and that's pretty much doubling from the numbers that we've had in 2017, so some progress on free cash generation. For this year, our expectation is to stay at similar levels where we are today within that the number that we achieved during 2016 -- 2018 was really very solid for our company. We expect CapEx to come down as a percentage of revenues a little bit more. I mean, now, we are being much more efficient in terms of CapEx, the size of bureaucracies that we're building helps us a lot in terms of making some efficiencies in that CapEx spending, as well as when we are negotiating contracts for laptops, for computers, for licenses, given that we are getting more scale, the per person or per seat cost is actually getting lower. So free cash will stated to be at similar level where it was in 2018. And that will -- that might help a little bit for -- from a lower CapEx as a percentage of revenues. But it was one of the highlights of the year, we're very happy with that number.

Okay, that's great. And can I ask a little bit about a Salesforce update? Can you give me a little bit of color in terms of how well you're staffed and how are the skill sets and staffing by studio, by region? And then kind of the balance of farming versus hunting as you look into next year?

Yes, sure. We are very focused in all of our regions. We have been expanding our coverage in a pretty systematic way and reinforcing those regions that we have within the organization to have the right coverage. The sales investments that we -- that was not, although, we're diluting SG&A, the S is growing, and we're planning to keep covering more and more customers and to get deeper into -- and closer expanding our teams in the U.S., our teams in Europe, our teams close to where we generate the revenues. So the overall action is that also, we are thinking that it's not just the sales guys that they want that really cover the account and get the deals. I mean, more than half percent -- more than half of the time, deals are coming from our delivery teams. The teams that are close to customer and understanding what happens there and so on and so forth. So we are now like making this kind of transformation where we are pretending to having much deeper sales force getting close to our customers. But that sales force not necessarily our traditional sales people but in essence, delivery people on the taking out side, on the pressure management side does understand very well how the customer develops and are able to take those opportunity to transform them into real business. So this is the approach that we are having today. We are investing a lot of money there, not just from the sales force but also on the delivery side, you have a much better and deeper coverage, and that's reflected as a result on the growth rates that you are seeing in the top 10 and on some top 10 accounts. So I think this growth parameter is still extremely important for us. We still believe that we have already the first customer that is in the $50 million range, which is a huge achievement for us, and we'll keep on adding more customers, we'll hopefully do that at least, and this is the update. We are investing a lot of money in improving that coverage.

Yes, Frank. Just to add on that. In terms of hunting and farming, we have been focusing a lot on farming and the farming numbers for 2018 was actually very, very high, close to 94%. So most of the revenue that we generated last year actually came from farming, and we think that, that is a direct consequence of the 50-Squared program. But again, as Martin said, we continue to hand some great logos and we continue doing so as long as we believe that those accounts have high potential for the company.

Okay, great. Thank you very much.

Thank you, Frank.

Thank you.

[Operator Instructions] Our next question comes from Arvind Ramnani from KeyBanc. Please go ahead with your question.

Hi, guys. Thanks for taking my question. I just wanted to circle back on the studios you all have talked about and that's going to center to your strategy. Are you able to share some specific metrics in the studios, specifically, what I'm looking for -- which of your studios are the largest? And also then, which are the ones which are a growing the fastest?

Well, we're seeing growth in many different studios. Some small studios are growing much faster than some big studios that are growing slower because they're already weak. So I think that the studios are managing pretty much all our talent. There are big pockets of expertise on the different areas that we are discovering, for example, we are seeing a lot of growth on the artificial intelligence studio. We are seeing a lot of growth on the mobile studio. We are seeing also big data and the consultancy studio where ideation takes place. And we are seeing some other studios like, for example, the new Salesforce studio that we go together with Avanxo. The cloud computing studio that are growing at pretty consistent manner. Although, their performance is not stellar, those studios are very consistent year-over-year in the growth. So I think that also, there are some other studios and -- like cybersecurity, that are pretty new, and they are growing very, very fast because they are very small. But also, I think that in our some other studios, like for example, gaming, which are very performing in extremely great way. Although, the gaming industry itself is not booming, so it's not growing that fast. So there is a blend on performance but I would say, out of our 20 studios, more than 15 studios are really performing extremely well than the rest are connected to areas that are growing a little bit slower. So -- but then, for example, you have a future of organizations and are actually delivery studios, those studios are rocking because they are presently matching every single proposal that we are doing and that's something that companies really understand that need in a very big way. So this is an overall perspective of the studios and how they are performing.

Great. And from my understanding, your studios are not restricted by geography, right, like...

Geography, no.

Okay. And then just to kind of follow-up on a question Maggie had asked earlier around this kind of expanding outside of Argentina and kind of with LATAM still being kind of a important geography. Do you all feel like pretty good from wage inflation and FX perspective? Or is that something you all feel you need to still manage a little bit carefully?

So Argentina -- we're having party and this is fun. So Argentina, when we went public, represented 70% of our headcount. So we have a very good culture to whatever was happening in the macro over here, right? But now, when we look at Argentina in terms of headcount it's about 30%, 35%, and it's going to become even less in the upcoming quarters as a percentage of the total. We are much more diversified. So -- and also, if you look at what's happened with the currency last year, it's actually depreciated quite a lot quite significantly. So overall, even though there might be some wage inflation in Argentina, the fact that Argentina is smaller and that we already have the tailwind from the depreciation last year makes us feel comfortable in terms of our gross margin expectations for Argentina and also for the region. When we look at all the other countries in the region, Mexico, Colombia, Chile and Brazil, much more stable economies. So you don't see the currency moving a lot. And typically, the currency depreciates a little bit with the dollar, and that helps us to offset the impact on salary increases that we have. And they're all talking about low single-digit numbers, so that's not an issue. So inflation right now is becoming less of an issue for us, especially because the only country where we face high inflation is becoming less relevant in the overall headcount structure that we have.

Great, great. And then just last question for me is kind of more of the kind of the opportunity in SaaS and cloud, and there's certainly a view that the last, kind of, Chapter 1 of cloud was driven mostly by consumer-facing apps and the public cloud, and the next phase of SaaS and cloud will be driven more from the back-end systems and in hybrid cloud. Just want to see if you all agree with that and are you all repositioning your, kind of, capabilities to take advantage of the trend?

Yes, I think we -- when we work with the customers, we equally listen about private and public cloud. And it's something that really is picking up our attention and so company started kind of -- in some aspects but doing some backlash to the typical cloud, but also the concept is very -- but the concept, although, that is very strong. So they're trying to perform the same capabilities. So they have to use private clouds with their own -- within their own domain or within their own control. But we see the cloud movement in a pretty strong manner. We are heavy users of it, and most of our customers are heavy users of the cloud. We see a massive competition coming from the main players to fight for the leadership on that space, which I think is really attractive for the customers. And we see big savings also coming from the cloud. So the hybrid model is great. The private model is great. But I think the concept in definitely is private hybrid or public is the strongest part and you need to pay attention to when we are paying attention in our cloud studio. Connected to this, there's a lot of cybersecurity issues that need to be taken care. So it's like our cloud studio is very well connected to our cybersecurity studios because things happen where things are out of control, and those two studios need to work together to keep the things under real control. So that's my take on what's going on right now with my customer. I don't know if I answered your question or not but this is what my understanding of the reality right now.

Great. Thank you very much and good luck for 2019.

Thank you so much. Thank you so much for your question.

Ladies and gentlemen, that will conclude today's question-and-answer session. I'd now like to turn the conference call back over to Martin Migoya for any closing remarks.

So thank you very much, everyone for participating in our call and looking forward to see you on the next one. Cheers. Bye-bye.

Ladies and gentlemen, that does conclude today's conference call. We thank you for attending. You may now disconnect your lines.