Nebius Group N.V. (NBIS) Q1 2012 Earnings Report, Transcript and Summary

Thank you for standing by and welcome to the Yandex Q1 2012 Financial Results Conference Call. [Operator Instructions] I must advise you that the conference is being recorded today, Thursday, the 26th of April 2012. I would now like to hand the conference over to your speaker today, Katya Zhukova. Please go ahead.

Hello, everyone, and welcome to Yandex's First Quarter 2012 Earnings Call. We distributed our earnings release earlier today. You can find a copy of the press release on the company's Investor Relations website, as well as on newswire services. Today, we have on the call our CEO, Arkady Volozh; and our CFO, Alexander Shulgin. Dmitry Barsukov, our Director of Corporate Finance, will be available during the Q&A session. Our call will be recorded. The recording will be available on Yandex's Investor Relations website in a few hours. We also put together these slides to supplement -- sorry, these slides are currently available on our Investor Relations website. And now I will quickly take you through the Safe Harbor statement. Various remarks that we make during this call about our future expectations, plans and profits constitute forward-looking statements. Our actual results may differ materially from those indicated or suggested by these forward-looking statements as a result of various important factors, including those discussed in the risk factors and operating and financial review and prospects in our annual report on Form 20-F dated March 2, 2012, that is on file with the SEC and is available online. In addition, any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. Although we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views change. Therefore, you should not rely on these forward-looking statements as representing our views as of any date subsequent to today. During this call, we will be referring to some non-GAAP financial measures. These non-GAAP financial measures are not prepared in accordance with the U.S. GAAP. A reconciliation of the non-GAAP financial measures to the most directly comparable GAAP measures is provided in the earnings release we issued today. And now I'm turning this call over to Arkady Volozh.

Thank you, Katya, for the introduction. And thank you all for joining us for a review of our Q1 results. And we are quite pleased with our first quarter achievements. On the user front, we maintained and extended our market leadership and expanded the range of services around our core search platform. We advanced our technology vision in mobile, and we saw significant growth in Turkey. On the advertising front, we are focused on enhancing advertising return on investment and our internal data, and analysis indicates that we are succeeding. But more on that later, and I would like to share some data on Internet usage trends in Russia first. Overall, Internet access and penetration trends are favorable for Yandex. I want to share a couple of key figures from the most recent study by the Public Opinion Foundation. One, there are now 57.8 million Internet users, which makes Russia the largest Internet market in Europe and #6 in the world by audience size. And two, those users represent only 49% penetration of population aged 18 and older, which is lower than many European countries and leaves a lot of room for growth in our home market. And now I'm turning to our core search product and our favorite number of 60% market share in search. In the first quarter of the year, we continued to enhance our search products, and we believe that the highly differentiated user experience on Yandex is the reason that we continue to lead the market. During Q1, we launched our People Finder, an important step in social search. Users in Russia can now view the public profiles of people with accounts on the most popular social networks. Our partnership with Twitter enabled our users to search public tweets in real time. We also improved…

Thank you, Arkady. In the first quarter 2012, Yandex consolidated revenues increased 51% year-on-year to RUR 5.9 billion. Contextual or text-based advertising continues to be the main growth driver for us, growing at 53% year-on-year and accounting for 90% of total revenues. Yandex's own websites bring the bulk of text-based revenue accounting for 73% of total revenue, while ads on the Yandex ad network accounted for 17% of total revenue. The Yandex advertising network grew 117% year-on-year due to the impact of the same factors that we highlighted in Q4. Improvement in the ad service technology on our partner network and the year-on-year effect from the addition of Rambler search to the partner network. Display advertising in Q1 grew slower than overall revenue, reflecting a return to a normalized growth pattern after a high Q1 2011 base. I just wanted to remind you that in Q1 2011, our display revenue more than doubled year-on-year. During Q1 this year, display revenue accounted for 7% of total and grew 28% year-on-year. The remaining 3% of our total revenues came from Yandex.Money and other sources. Our traffic acquisition costs related to the partner network grew in line with revenue growth there, while distribution tax trailed growth of owned and operated revenue, remaining approximately the same as percentage of owned [ph] revenue. As a result, our total ex-TAC revenue increased 45% year-on-year. Text-based revenue was primarily driven by paid clicks, which increased 61% year-on-year. Accelerated growth in clicks was evident on our own and advertising networks as alike. As Arkady mentioned earlier, we continue to see the beneficial impact of our advertising technology initiatives. The decrease in average CPC makes our advertising more directed towards our customers. Reasonable CPC levels combined with new technological initiatives and precise targeting drives considerable paid click growth, which…

[Operator Instructions] And your first question today comes from the line of Edward Hill-Wood from Morgan Stanley.

I have a couple of questions. The first one just relates to the advertising number which you reported, which is up, as you said, 40% year-on-year but it's only up 3% quarter-on-quarter. And I was just wondering whether or not there's a seasonal impact there. I looked historically, and there does seem to be a much slower trend in Q1 relative to Q4. But I was wondering if there was anything specific there whether or not you would expect that number to accelerate into Q2? And the second question just relates to your agreement with your distributors. I noted in your 20-F that it looks as though the Mozilla contract has been shifted out to December. Could you just comment on that, please, and why that wasn't negotiated on a longer-term basis, if that is indeed correct? And then finally, just on your margins, you obviously had a decline in margins year-on-year in this year, but it does look as though in 2011, the Q1 margin was unusually high relative to the full year distribution. And if you go back previous years, it looks as though there's been a sort of average 6% or 7% increase between Q1 and the full year margin. Just looking at the run rate of your cost inflation, do you still think it's reasonable to assume broadly [ph] flat or even growing margins for this year? Those would be the 3 questions, please.

Talking about number of advertisers, that's a historical pattern for Yandex and actually for all of the advertising industry here in Russia. While in Q4, we see high growth of advertisers and high sales of the small and medium enterprises, while Q1 is historically lowest in terms of number of advertiser growth, especially the months of January. So that's typical pattern that we are comfortable with advertiser growth this year. Now talking about Mozilla, as you correctly mentioned, the agreement with Mozilla was renewed until the end of 2011. And we're in active -- sorry, 2012 -- and we're in active discussions to extend our cooperation with them, but we cannot comment on specific points. Maybe one item to mention here is that we've been recently added as the second search provider in Mozilla in Turkey. That's a sign of our cooperation. And talking about margin, Q1 margin, as you correctly mentioned, Q1 last year was very high for us in terms of margin, unusually high due to high revenue growth of 65%. And one item to mention again here is that display revenue growth last year was 120%. That's typical seasonality pattern for Yandex. We believe that our Q1 margins are consistent with our expectations for the full year. And talking about full year, as we discussed in our previous earnings call, our intention is to be approximately at the same level as last year in respect of adjusted net income and EBITDA margins. But having said that, we continue to look for high-growth investment opportunities as [indiscernible] high-tech Internet company. And although there are no such plans at the moment, when and if such opportunities present themselves, we will invest, which could have an impact on our margins.

Your next question comes from the line of Lloyd Walmsley from Deutsche Bank Securities.

Just had a few short ones on the competitive landscape. Wondering if you could give us an update on what you're seeing in terms of the competition, both in terms of marketing, as well as things the competition may be doing online in terms of downloads and converting users on search. And then secondly on display, any difference in the competitive environment you're seeing in terms of display versus search? And then unrelatedly on paid click growth, just wondering how long you guys think you can sustain paid click growth in excess of SERP growth. And if you can elaborate a little bit on how much this is driven by MatrixNet improvement versus increasing coverage or other algorithmic changes you're making, that would be great.

Commenting on the condition in advertising, you know that we are not the largest online company in -- which advertises here on this market. We ran this ad campaign, which has been, maybe, the largest in our recent history, and we're very pleased with the results. But again, we compete with other players which advertise even more heavily.

Maybe talking about paid click growth and search result pages growth, yes, we see high paid click growth of 61% in Q1. And it was also high in Q4. One important item which helps to drive this high paid click growth, and we expect it to continue high for several quarters ahead, is the technological improvement in the Yandex head network where we improved CTR, advertising relevance in the partner ad network, which helps to drive high paid click growth. There are also opportunities to increase relevance on search. So we expect we'll be able to maintain accelerated growth of paid clicks for our overall business.

Yes. The second question was for how long the text-based advertising will outpace the display, right?

Yes, exactly. Do you think that, I guess, the changes you're making to improve the relevance and add more advertisers can sustain that over the long term or the intermediate term?

It happens, actually, for a long time now when, especially when advertising grows faster than display. From what we see this year, at least as it started, yes, the tendency continues. But it's hard to predict where it goes. What we are thinking on the market is that Internet as a whole becomes more and more major media for all of the traditional advertisers. Maybe there will be some shift moment when they all -- when they shift their display ads more massively than they do today.

Maybe also one item to add here, that's Alexander, that display advertising and contextual text-based advertising have different customer bases. Contextual is primarily for small and medium advertisers. And for them, it's not really an advertising but sales, too. So for them, they have to advertise in order to have sales, while display is for mostly used by big multinationals or big local companies. So given that there are different customer bases, the trends in this advertising media channels are sometimes slightly different. So for us, for Yandex, we saw contextual to grow faster than display for several years now. At this point in time, there is nothing that will suggest that the trend will reverse for Yandex.

Your next question comes from the line of Alex Balakhnin from Goldman Sachs.

I have 3 questions, if I may. First is on CPC dynamics. So we noticed that the decline, the year-on-year decline, has slowed down on the first quarter. Do you think this trend will continue or you will use each and every opportunity to drive CPC down further? My second question is on the SERP dynamics, not just for you but for the entire market. There were concerns that the overall search traffic slows down for us overall. What trends do you see here? Is the growth of market SERPs is the same as it was, say, last year? And lastly on the dynamics of the EOG's [ph] [indiscernible] advertising, which was growing not as fast as it could, what was the sell-out ratio the first quarter? And how advertisers reacted to the price increase for some of your inventory? And on the RTB system, what the initial uptake of the service do you see and what is the economics of this RTB when you place the display advertising on your advertising network website? Is it similar to the text-based or is it different?

This is Dmitry. I'll take the question about SERPs. Probably, you were looking at the information on LiveInternet to try to assess a SERP growth. And we should, here, maybe, mention that LiveInternet is a great tool, but it is not really designed for that kind of measurement being based on counters. And at times, it can show faster growth than in reality, and at times, slower. You just saw that Yandex's SERPs, as we reported, grew 36% year-on-year. And this is in excess of what LiveInternet -- what one could count based on LiveInternet. Now on CPC, the decrease in CPC that you saw in Q1, as we mentioned, was a result of our conscious efforts. And the factors that drove CPC down are likely to be in effect in Q2 as well. And after that, they again likely would be phasing out as year-on-year comparisons become more like-to-like. Finally, about your question on display advertising, again, one thing to point out is very strong growth in display in Q1 last year. And specifically about RTB, it has not had an impact on Q1 numbers. And as we are rolling it out, we are expecting to see effect. But again, it's likely to take some time for RTB to really show its impact.

And I have a quick follow-up on the first question. So from what you say, I wasn't really referring to LiveInternet or anything. I just wanted to like double-check with you what you see. So from what you say, you see pretty much as stable growth of overall search traffic in Russia, as you saw last year. That's pretty much what you said, right?

Yes, in Q4 last year, more specifically.

But given the market share differences, the traffic has probably -- for the entire country, the traffic has probably even accelerated, right?

We see very strong growth in traffic. We see increase in the number of users. We see growing usage and adoption of the Internet. And nothing had changed in the game for us.

Your next question comes from the line of Gene Munster from Piper Jaffray.

Could you talk a little bit about where margin trends will be going forward? I guess beyond the June quarter, how should we think about margins? I guess in particular, as you think about market share, the kind of the competitive dynamic, how is that going to potentially impact margins over the next 2 or 3 quarters?

We do not give guidance on margins. But what I could say is that we're happy with the Q1 margins, and it's consistent with our expectations. Talking about full year, again, we have no guidance. What I could say is that our intention is to be broadly in line on the full year level with the margins of last year. But again, since we are looking for new opportunities to grow our business, in terms of technological investments or geographical expansion, as I mentioned, in Turkey here, we are looking for opportunities. And when those opportunities present themselves, we will invest. And given that most of our investments has been in people, this could have an impact on our P&L. But again, there are no such plans at the moment.

Okay. That's helpful. And then second is can you just talk a little bit about just general commentary on how things in Europe are and in Russia in particular in terms of the economy and how you see that kind of playing out over the next 3 months?

Talking about macroeconomics trends here in Russia, we see the Ministry of Economy and IMF provide the GDP growth forecast in the range of 3% to 4%. From the macroeconomic perspective, Russian economy remains very strong. Inflation is forecasted to be in the range of 5% to 6%, which is, I guess, the lowest for several years. Public debt to GDP ratio is very strong compared to Western Europe and many developed countries at 12% only. Oil prices remain high. So from the macroeconomic perspective, everything is fine. And we see good advertising trends from our customers.

Your next question comes from the line of Mariya Kahn from Bank of America.

I just have a few questions, if I may. First of all, if you could tell me if SPB expense, your expenses, is a one-off for this quarter or is going to carry on throughout the coming quarters. Also wanted to hear your thoughts on why you think we're seeing nice improvement in your search share in Chrome in particular. What's driving that? And also, if you could break down your paid click growth, organic versus inorganic, i.e. if we strip out Rambler and other partner sites that you added, what would your paid click growth be? Would it be similar to the SERP growth? I will leave it there.

That's Alexander, thank you for the question. Talking about SPB, SPB is in low single digits. So [indiscernible] expenses. So that's not that high. But one item to mention here is that part of the amount that was paid to SPB in the cost of acquisition of the company is, according to U.S. GAAP, is recorded in our personnel expense. In Q1 particularly, the amount was USD $2.6 million. So again, to reiterate, this amount was effectively a consideration paid for the company, but it is recorded in personnel expense because it was linked to continued employment of the senior management of the company.

Let me comment on the Chrome. Something important happened this quarter with our market share in Chrome. If you remember last year, when Chrome was just launched, users, there was -- Google users' market share was larger than the Yandex users. And it took our users some time to realize what happens. And since we kind of a [indiscernible] here -- it took them some time to realize how to get the Yandex back. And it looks like they realized it at last, and they used options to change the default. And now our market share in Chrome is higher than Google's market share in Chrome, which is important for us.

So it has nothing to do with anything you did specifically, it's more that the users are changing preferences?

Of course, we tried to tell them how to promote, the way how to get Yandex back. When we see that they're using Yandex on Chrome, we try to explain them how to change the default. But it's -- again, you cannot do [ph] watch -- if they don't -- there is no natural push to your system.

I'm talking about paid click growth. We do not publically disclose the growth in paid clicks on the [indiscernible] website and network because that's an important financial information. What I could say is that no single partner, including Rambler, has a material impact on our paid click growth. And the accelerated growth was primarily driven by improvements in technology, especially the relevance of the ads displayed on the websites.

One more question before I finish. What do you think about the Polish market? Would you potentially be interested in entering that market like you did with Turkey?

As we told earlier, any market with no competition is in our field of interest because we believe that the choice we can bring to those markets, choice of using the search, is important for users. And it doesn't depend on us or Google or somebody else. If users prefer having choice, then it's a niche for us. So any market with no choice is our potential target. But first, we need to prove ourselves in Turkey.

Your next question comes from the line of Alexei Gogolev from JPMorgan.

Arkady, just to elaborate a bit on your last comment about Turkey. Previously, you said that you're hoping that by the end of the year, you may reach 1 million daily link users and then you may consider starting a monetization of that market. It appears that you may reach this 1 million threshold earlier. So would you consider launching monetization, say, in the middle of this year?

No, we reached 1 million searches, which is not 1 million users a day. Turkey has something like 150,000 daily searches, something of that range. So 5%, 10% of the market share would be something like 10 million, 15 million searches a day. And of course, we need to grow there to start selling.

Okay. And with regards to the outlook on the Russian advertising market, are you seeing -- I mean, we are 4 months into the year. Are you seeing any more upbeat kind of information about the market? I mean, have you, for example, seen any greater inflow of large-scale advertisers, those that haven't done any online ads previously but now are switching to the online from traditional advertising?

Alexei, this is Alexander. I'll take your questions. Well, as we discussed, Q1 is seasonally the lowest quarter for the Russian advertising market and for Yandex. So it will be too early to say -- to comment on the full year trends. We see that Q1 revenue growth was very good for us, in line with our expectations, maybe exceeding a bit. But it's still too early to say. And that's why we remain on our guidance in the range of 40% to 45%. As we -- it's the same guidance that we gave in February of last year. Talking about big customers coming, yes, we saw additional new big multinationals coming to advertise on contextual and display. So the positive trend remains in this respect. And let me stipulate here a little bit. We have big, mostly foreign advertisers in display, and we have a lot of small businesses in search. And my speculation is that maybe the foreign advertisers, having experienced some crisis effects on their markets, decreased their spending in Russia, whereas small Russian businesses who live here and see the real economy here, they didn't cut their spending. But again -- and if this is the case, then I hope that by the end of the year, the situation will change and the big advertisers will come to advertise to Yandex, as well as to other medias. But again, it's just speculation.

Our next question comes from the line of David Reynolds from Jefferies.

Just one question for you on traffic acquisition costs. I think you reported in Q1 traffic acquisition costs were 18.7% of your search-based revenues. Could you perhaps just give some background on the trends you see in traffic acquisition costs and perhaps how you expect them to evolve across the rest of the year?

It's Alexander. Our traffic acquisition costs, they consist of 2 independent, I will say, elements. One is traffic acquisition costs related to our partner websites, which plays our advertising on their websites. This element of traffic acquisition costs, which is the biggest part of our TAC, was growing virtually in line with revenue coming from partner websites. That's one. Second element is traffic acquisition costs related to distribution arrangements. And that one was growing in line or slightly below the growth in owned and operated websites. So in combination, TAC was growing at slightly faster rate than total revenue purely due to faster-than-average growth of partner revenue.

Yes. That's great. And what about trends going forward? Would you anticipate that contribution increasing over time?

In Q3 last year, we did substantial improvement in ad relevance technology on the Yandex ad network, and we expect that network to continue to grow at a faster rate until we start cycling [ph] that period when those improvements happened. Therefore, I guess TAC as a percentage of revenue could be growing slightly -- a bit until [indiscernible] cycling this period in Q3 approximately this year. Talking about distribution TAC. I guess, but it's difficult for us to comment. We expect to remain as approximately the same as percentage of revenue as it is now.

And your next question comes from the line of Anna Lepetukhina from Troika Dialog.

I have just one question. It is on the increase in revenues from Yandex partner network website. It is growing at more than 100%. And as far as I understand, it is driven by both the inclusion of Rambler and introduction of MatrixNet in the third quarter of last year. Is it possible to split this growth into components and kind of so we can understand where the growth will be in the second half of the year once kind of the slow days' effect eliminates?

This is Alexander. It's, again, difficult to dissect our revenue growth by element. And I think we'll be able to provide that guidance for you. I would better refer you to our full-year revenue guidance of 40% to 45%. And there are shifts between [indiscernible], and the search network. Sometimes network grows faster. Sometimes search grows faster. So it will be difficult for us to comment. For our customers, talking from the customer perspective, what we care of is growth on paid clicks and cost per click and return on investment. They don't really care from what part of our system the click comes. So that's why we prefer to look on full revenue growth rather than by source.

Okay. And can I have a follow-up question on the increase in employee headcount? In the first quarter, it increased almost 25% year-on-year. Is it the rate that we should expect for the whole year and extrapolate for the whole year? Or in the first quarter, you increased the number of employee higher than you expect to do for the whole year?

Talking about headcount, our preference is to look on personal expense ratio to revenue because we employ people, but we also outsource development of our technologies to third-party companies. So purely headcount is not really a metrics to look at. And historically for Yandex, personnel expense revenue ratio was about 20%. And we think it -- well, there is nothing that suggests this will change going forward.

Your next question comes from the line of Anastacia Obukhova from VTB Capital.

This is Anastacia Obukhova from VTB. I have a few questions, if I may. Your display revenues boasted quite a mode [ph] of growth of 28% despite the ad price increase of about 45% to 50% the 1st of January. What was the main, say -- where the budget came from? And the second one, SG&A, which part of the year-on-year incremental increase came from advertising campaign undertook in the first quarter and which part is going from the continuing expenses now related to your public listing, professional fees, audit, et cetera, so these expenses that [indiscernible] contained in the first quarter a year ago. And also, how long will this ad campaign be undertaken and when was it started? I maybe overheard it. And also, contingent payments, what is the ground of the fact that you may get them back in November 2013, so if -- meaning that your personnel may not achieve some KPIs or not? And the last question, maybe your finance guy will help me how you come to your EBITDA calculation. If I add up everything from the bottom line, according to your calculation, and if I add up the contingent payment to personnel, I still miss some $1 million. I cannot account it.

This is Alexander speaking. Talking about display, we would like to, again, to point to the fact that display revenue was growing at 120% a year ago in Q1 2011. So we believe this is the main reason why display advertising was growing 20% this year, simply due to the fact of high base. The question about SG&A costs, as we have mentioned during the call -- well, I will compare it to Q4 last year. Our cost base was particularly flat compared to Q4, and there are only 2 items that were standing out, was in social tax, which is front-loaded to Q1 -- this is how it works in Russia. And the second is advertising campaign. And the advertising campaign is recorded in SG&A expenses. So in a way, that's one of the main reasons why SG&A was growing versus Q4. Talking about the advertising of the Yandex services, yes, we're on the campaign in Q1. And if we have opportunities to advertise our new services, improve technologies to our users, we will do so because it's important for us to communicate what's good was done by Yandex. But I don't think I'll be able to quantify the cost amount at this point in time. On structured personnel expense, again, it's important commercial and competitive information for us, so I will not be able to disclose that. Again, I would like to point to the fact that our personnel expense revenue ratio was about 20% for several years and probably will be in the same ratio.

Can I ask the follow-up question then? Yes, so about, again, SG&A cost. You're saying that your -- the more or less similar structure as you had in the fourth quarter, though in the fourth quarter '11, your SG&A went up by 29% year-on-year. And again, fourth quarter '10 didn't have this public listing cost, et cetera. And your first quarter '11 also, indeed, included the social tax payment, and your personnel expanded by 25% year-on-year, and though the expenses grew up by 79%. That's why I just wanted to quantify the impact of overall -- of recurring cost on [indiscernible] material and how it will be continuing.

This is Dmitry Barsukov. I'm afraid we are not in a position to provide more detailed information because we live in a competitive world. I'm sorry about that.

Okay, okay. And please come back to me to your EBITDA calculation because I just don't get how you come to the number you state in press release, OK? If possible.

Well, it's a good question. And we have reconciliation at the back of the press release. It's probably better if we take up this question offline.

Your final question today comes from the line of David Ferguson from Renaissance Capital.

Just 2 quick questions, please. Firstly, on the browser market, maybe just share your thoughts on how well you think browsers like Opera have responded to Chrome's growth over the last 12 months and the steps that they are taking to protect their market positions, what you, I guess, would like to see your browser -- main browsers, do to protect the market position going forward. That's the first question. And then secondly, on mobile and SPB, I guess the first product they've developed for you is the Yandex.Shell. So just maybe a little bit of color on that's initial success in terms of downloads and then going forward. How do you see SPB's role evolving? That's it.

On the browsers landscape, we currently stick to -- actually, the browser question has 2 aspects. One is technical, another is distribution. On the technical aspect, we do have our browser. We have open-source-based browser, which people always use. But we don't want to distribute it and because we now currently count on our partners, which are currently Opera and Mozilla, which together account for almost 60% market share in browsers. And so far, we are successful partnering with them, and we don't want to compete with our partners. On SPB and mobile, SPB is our opportunity in the Android world. There is a growing number of devices supporting Android. Android is an open platform as well. And we need our own product built on that open platform to be able to be distributed with hardware partners here in Russia. And we showed some success in distributing it on the number of downloads and so on with SPB, which leads just to say that as soon as we -- we launched just the first better product. There's a product called MAP [ph], which we have for this year. But even with this early version, which we launched by Barcelona Congress in February, we turned it -- we launched the free version, and we increased the number of users by times. Maybe that's as much as what we're willing to say at this stage.

Thank you. I would now like to hand the conference back to the management team for any closing remarks.

Okay. It's been almost a year since we filed our first IPO prospectus. There were a lot of promises made and a lot of models built by analysts just to pay your attention to what happened during this year. First of all, we sustained the market share, and we're still at the ballpark of 60% market share despite a fierce [ph] changes on the distribution front, complete change on the browsers market shares. Still, we retained our basic 60% position in market share in search. Also, we grew faster than analysts expected last year, and we continue to grow this year as we expected. We just confirmed our growth rate of 40%, 45%. And finally, our Turkey launch will take -- it's too early. It will take a lot of time and effort. But the early results actually encourage us a lot. Thank you for participating on this call.

Thank you. That does conclude the Yandex earnings call. Thank you all for participating. You may now disconnect.