NYSE:TRU TransUnion Q1 2024 Earnings Report $72.88 -0.87 (-1.18%) Closing price 04/17/2025 03:59 PM EasternExtended Trading$73.00 +0.12 (+0.17%) As of 04/17/2025 05:45 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast TransUnion EPS ResultsActual EPS$0.83Consensus EPS $0.71Beat/MissBeat by +$0.12One Year Ago EPSN/ATransUnion Revenue ResultsActual Revenue$1.02 billionExpected Revenue$977.62 millionBeat/MissBeat by +$43.58 millionYoY Revenue GrowthN/ATransUnion Announcement DetailsQuarterQ1 2024Date4/25/2024TimeN/AConference Call DateThursday, April 25, 2024Conference Call Time9:30AM ETUpcoming EarningsTransUnion's Q1 2025 earnings is scheduled for Thursday, April 24, 2025, with a conference call scheduled at 9:30 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Q1 2025 Earnings ReportConference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by TransUnion Q1 2024 Earnings Call TranscriptProvided by QuartrApril 25, 2024 ShareLink copied to clipboard.There are 12 speakers on the call. Operator00:00:00Hello, and welcome to the TransUnion First Quarter 2024 Earnings Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. As a reminder, this conference is being recorded. I would now like to hand the call to Greg Barty, Vice President, Investor Relations. Operator00:00:36Please go ahead. Speaker 100:00:39Good morning and thank you for attending today. Joining me on the call are Chris Cartwright, President and Chief Executive Officer and Todd Sello, Executive Vice President and Chief Financial Officer. We posted our earnings release and slides to accompany this call on the TransUnion Investor Relations website this morning, and they can be found in the current report on Form 8 ks that we filed this morning. Our earnings release and the accompanying slides include various schedules, which contain more detailed information about revenue, operating expenses and other items, as well as certain non GAAP disclosures and financial measures, along with the corresponding reconciliation of these non GAAP financial measures to their most directly comparable GAAP measures. Today's call will be recorded and a replay will be available on our website. Speaker 100:01:26We will also be making statements during this call that are forward looking. These statements are based on current expectations and assumptions and are subject to risks and uncertainties. Actual results could differ materially from those described in the forward looking statements because of factors discussed in today's earnings release, in the comments made during this conference call, and in our most recent Form 10 ks, Forms 10 Q and other reports and filings with the SEC. We do not undertake any duty to update any forward looking statement. With that, let me turn it over to Chris. Speaker 200:02:03Thanks, Greg, and let me add my welcome and share our agenda for the call this morning. First, I'll provide the highlights of our Q1 2024 results, including an update on our progress against our transformation initiatives. 2nd, I will discuss our India growth story. And finally, Todd will detail our first quarter and full year 2024 guidance. In the Q1, TransUnion significantly exceeded guidance across revenue, adjusted EBITDA and adjusted diluted earnings per share. Speaker 200:02:39Given the strength in the quarter, we are raising our full year 2024 guidance, which Todd will describe later, while still maintaining a conservative guidance posture given still tepid market conditions and macroeconomic and geopolitical uncertainties. Revenue in the quarter exceeded $1,000,000,000 for the first time in the company's history, growing 8% plus on an organic constant currency basis, well above our 3% to 4% guidance. Mortgage drove much of the outperformance due to better than expected 3rd party score and credit report price realization as well as slightly better pre qualification volumes. We expect much of the pricing benefit to persist throughout the year, increasing our expectation for mortgage growth. However, our mortgage volume assumption remains conservative as in February. Speaker 200:03:34And in fact, we have trimmed volume expectations for the second half of the year despite the strong start to provide further cushion against an uncertain mortgage market backdrop. Our organic constant currency growth excluding mortgage of 5% also exceeded our expectations led by international as well as key emerging verticals such as insurance, media, public sector and collections. U. S. Markets grew 7% with financial services up 13% and emerging verticals up 4%. Speaker 200:04:10Consumer Interactive declined 2% as expected. Consistent with the 4th quarter, muted but stable economic conditions and lending volumes supported financial services growth. Consumer finances in the U. S. Remained healthy due to low unemployment and real wage growth. Speaker 200:04:30Inflation is moderated, but remains above target and market expectations have reverted to higher for longer interest rate forecasts. Lending standards remain tight as lenders face potentially increasing capital requirements as well as rising delinquencies, albeit still within historical averages. The banks echoed these sentiments during recent earnings calls, reporting subdued loan and deposit growth as they balance consumer resiliency against continued market uncertainty. Within U. S. Speaker 200:05:05Markets, NuStar delivered another good quarter and we remain on target to grow mid single digits in 20 24. Communications, marketing and risk all contributed led by robust growth in Trusted Call Solutions. Our International segment grew by 15% on a constant currency basis, the 12th consecutive quarter of double digit growth. India led with 31% growth, while Canada, Asia Pacific and Africa again grew double digits. Finally, we achieved key milestones in our transformation program, reinforcing our confidence in delivering against our financial commitments. Speaker 200:05:46Let me address this in more detail. As we discussed last quarter, our transformation efforts comprised 2 complementary programs, optimizing our operating model by further leveraging our Global Capability Centers or GCCs and modernizing our technology capabilities. We believe these initiatives will accelerate innovation, streamline workflows, reduce costs and ultimately position us to deliver better experiences to meet the evolving needs of customers and consumers. In our operating model optimization program, we substantially completed our local market workforce reductions and migration notices in the Q1. Concurrently, we're on track with our planned GCC hiring. Speaker 200:06:33We now have roughly 4,900 employees and our talent acquisition in India, South Africa and Costa Rica is stronger than ever. As more work shifts to the GCCs, we're taking a rigorous approach to change management, systematically tracking and documenting knowledge transfer, training our leaders to manage increasingly global teams and developing a feedback loop to improve processes continuously. We're also deliberately balancing the need for customer centric work in markets with the opportunity to centralize, standardize and automate key global functions. In our technology program, we're modernizing our capabilities by completing our cloud transformation and leveraging Neustar's technology to consolidate the assets we've built and acquired in recent years onto OneTrue, a common state of the art solutions enablement platform. OneTrue is becoming the platform for ingesting, managing, governing, analyzing and delivering data and insights. Speaker 200:07:39The OneTrue platform integrates separate data and analytic assets in credit risk, marketing and fraud prevention and concentrates them in a single layered and unified environment. We believe that OneTru will enrich our data quality, speed time to market and accelerate innovation, ultimately driving better growth across our credit fraud and marketing solutions. From a financial perspective, we expect OneTrue will also save costs and enable us to rationalize applications and standardize global services. These efficiencies will allow our engineers to focus more time on innovation. Finally, the standardized operating model will enable us to adapt more quickly to rapidly changing regulations and ensure compliant data usage. Speaker 200:08:29Our focus in 2024 2025 is in consolidating our U. S. And India products, data and analytics onto the platform in accordance with respective laws and regulations. We made meaningful progress in the Q1. We launched advanced acquisition in the U. Speaker 200:08:49S, which combines data enrichment with our credit and marketing capabilities for an integrated credit based consumer prospect marketing solution. We also moved key capabilities of our short term lending credit bureau, Factor Trust, onto 1 True with full online solutions to follow, representing the 1st credit bureau applications OneTru as well as our core U. S. Credit onto OneTrue over the next several quarters. These actions reinforce our confidence in delivering an expected $65,000,000 of operating expense savings in 2024, And we continue to target $200,000,000 of free cash flow benefit by 2026. Speaker 200:09:45Now over the last 2 decades, TransUnion has built a leadership position in India, one of the most attractive global markets. We've grown our Indian business more than 30% every year since 2017, except for the pandemic here in 2020. And this market contributed roughly 1.5 points to total company growth in 2023. We have a tremendous long term opportunity to enable growth in the Indian market. India is the 5th largest economy in the world and the fastest growing with GDP expected to drop double by 2,030. Speaker 200:10:212 thirds of India's population is under the age of 35. And this segment alone comprises 890,000,000 people, more than 3 times the size of the U. S. Adult population. These demographics drive economic growth and needed sophisticated consumer credit system to support an expanding aspirational middle class. Speaker 200:10:43Indian government remains highly focused on modernizing its economy, promoting financial inclusion and digital transformation initiatives. India's evolving economy creates high demand for credit, marketing and fraud solutions and we have built a unique market leading business. The credit bureau TransUnion Civil was founded in 2000 and has become a household brand that is synonymous with credit reports. We have 640,000,000 consumer records in our bureau, growing roughly 15% each year. We serve more than 6,000 institutions, including the largest banks, non banking financial institutions, Fintechs and insurance companies. Speaker 200:11:26We also reach 100,000,000 consumers directly through our consumer solutions. As the leading credit bureau, we play an impactful role in the Indian credit economy. We closely engage with the regulatory and government institutions such as the Reserve Bank of India and the Ministry of Finance to support initiatives focused on managing financial stability and systemic risk, as well as driving financial inclusion. We also improved financial literacy through our education and awareness programs and our direct connections with more than 100,000,000 consumers. And as I will describe in more detail later, we enable credit penetration in critical underserved areas such as small and midsized businesses, agriculture and microfinance. Speaker 200:12:16Our strategy in India exemplifies our enterprise vision to make trust possible between consumers and businesses in global commerce. India's market dynamics by themselves drive attractive growth with GDP growing nearly 8% and credit growing roughly 16% in 2023. We expect strong volumes again in 2024, albeit with likely lower growth rates as the lending ecosystem takes a modestly more conservative stance. We have consistently outperformed the underlying market. However, driven by the same growth playbook that we use across our business. Speaker 200:12:551st is client engagement or deepening client shift. We empower our verticalized sales force to focus on thematic selling, emphasizing our role as a trusted advisor to our clients. This enables us to build upon our already strong share in core consumer credit by expanding our suite of solutions and penetrating new lenders. 2nd is product innovation. Successfully bring innovation from other markets to India, such as trending credit data and consumer education tools. Speaker 200:13:31Increasingly, we're driving in market innovation like our API Marketplace and in areas such as financial inclusion, fraud and identity and open banking. We're also exploring opportunities to bring NuStar capabilities such as trusted call solutions and marketing products to the Indian market. 3rd is market adjacencies or India's version of emerging markets. Key focus areas are commercial, FinTech and direct to consumer. Commercial credit is unique to India as we do not operate a commercial bureau in the U. Speaker 200:14:08S. We help Indian lenders assess the creditworthiness of businesses based on credit as well as bank statement, tax and trade data. From 2018 to 2023, we grew in India at a 27% compound annual growth rate. And the chart on Slide 9 highlights how the growth playbook enabled this market leading performance. Consumer credit grew at a 23% CAGR, commercial Fintech and direct to consumer grew to faster combined 36% CAGR and now represent roughly 40% of revenue. Speaker 200:14:44We believe over time our solutions outside of consumer credit can contribute 50 percent plus of our Indian revenue. We're only scratching the surface of the opportunities outside of consumer credit with the right to win given our scale and brand recognition, our breadth and the quality relationships that we have in the market as well as product innovation. Much of our next generation of innovation focuses on enabling credit penetration in underserved sectors, all of which the government of India has identified as key economic growth priorities. Our fit rank assessment uses credit and alternative data for sharper risk differentiation of small and midsized businesses. The solution enables lenders to better serve India's 63,000,000 small and medium businesses, which contribute to 30% of India's GDP. Speaker 200:15:40The Civil Credit and Farm Report consolidates credit, satellite and other relevant agricultural data to begin to digitize the historically manual and cumbersome agricultural lending process. Farming is the livelihood of 55% of the Indian population and agricultural loans account for at least 18% of the bank's lending portfolios. And the Civil Microfinance report and SCOR provides comprehensive data and analytics to serve the 70,000,000 microfinance borrowers in India. Microfinance refers to collateral free loans for lower income families. The loans average roughly $500 and typically focus on rural and remote areas. Speaker 200:16:25The Reserve Bank of India has specific mandates for lending to this segment of the population. Closeout, India is a multi decade growth story for TransUnion. At our Investor Day, we targeted $300,000,000 of revenue from India by 2025 and we are well on our pace to exceed that target. We continue to believe this business can deliver conservatively 20% plus growth over the medium term. And our next goal is to build India into a $500,000,000 business over the next several years. Speaker 200:17:00Now Todd will provide further details on the Q1 financial results and our Q2 and full year 2024 outlook. Todd? Speaker 300:17:10Thanks, Chris, and let me add my welcome to everyone. Before I begin, I wanted to highlight our updated segment reporting. Starting this quarter, we are reporting our consumer interactive business within our U. S. Market segment. Speaker 300:17:25Additionally, we have shifted certain revenue between U. S. Financial Services, U. S. Emerging Verticals and our International segment. Speaker 300:17:33These actions better align our reporting to how we run the business under our U. S. Markets and international presidents. We have provided recast 20222023 quarterly results for the updated reporting in an 8 ks filed on Tuesday and have posted the details to our Investor Relations website. Additionally, in the appendix of today's presentation, we have provided incremental vertical revenue mix disclosure for our U. Speaker 300:18:03S. Financial Services, U. S. Emerging Verticals and Consumer Interactive Businesses fiscal year 2023. Chris mentioned in the Q1, we exceeded our guidance on all key financial metrics. Speaker 300:18:171st quarter consolidated revenue increased 9% on a reported basis and 8% on an organic constant currency basis. There was no impact from acquisitions and a less than 1% benefit from foreign currency. Our business grew 5% on an organic constant currency basis, excluding mortgage from both the Q1 of 2023 2024. Adjusted EBITDA increased 11% on a reported and constant currency basis. Our adjusted EBITDA margin was 35.1% ahead of our expectations and up 80 basis points compared to the year ago quarter due to flow through on revenue growth. Speaker 300:19:031st quarter adjusted diluted earnings per share was $0.92 an increase of 14%. The adjusted tax rate for the quarter was 22.5%. Finally, in the first quarter, we took $43,000,000 of one time charges related to the next phase of our transformation program, dollars 24,000,000 for operating model optimization and $19,000,000 for technology transformation. We continue to expect to incur roughly $200,000,000 of one time expenses in 2024, driving $65,000,000 of in year operating expense savings. As part of our 355 $1,000,000 to $375,000,000 program, we expect the remaining $75,000,000 to $95,000,000 of one time expenses to be incurred in 2025. Speaker 300:19:59Looking at segment financial performance for the Q1, U. S. Markets revenue, which now includes Consumer Interactive, was up 7% compared to the year ago quarter. Adjusted EBITDA for U. S. Speaker 300:20:12Markets was up 6% and adjusted EBITDA margin was down 20 basis points to 36.2%. Financial Services revenue grew 13% with trends broadly consistent with the levels seen in the 4th quarter. Excluding mortgage, financial services revenue was up 1%. Consumer lending revenue returned to growth, up 2% in the quarter. Activity remained muted as FinTechs and others remain cautious given rates and market uncertainty. Speaker 300:20:48New customer and wallet share wins across FinTech, buy now pay later and short term lenders offset some of the softness and contributed to growth. Our credit card and banking business was flat. While issuance is healthy on a historical basis, online and batch activity remains tempered as lenders manage rising delinquencies. We are enabling our customers to navigate the current environment and position themselves for future growth with highly relevant products such as our TruVisions risk solutions, TruIQ's analytical suite, Trusted Call Solutions and our true validate fraud offerings. Our auto business grew 2% despite continued headwinds in the auto market, driven by new business wins and growth from captive auto lenders. Speaker 300:21:43Consumers particularly near prime and subprime continue to face affordability challenges from higher interest rates and declining but still high used car prices. Improved new vehicle inventory has provided some increased credit volume as well as interest from OEMs and dealers in non credit solutions as they seek to acquire more customers. We are seeing strong momentum selling NuStar Marketing and Trusted Call Solutions into the auto space. For mortgage, revenue grew 52% against inquiry volume declines of 8%. Outperformance related to higher than expected price realization on 3rd party scores and credit products. Speaker 300:22:34Volumes were also slightly higher than our expectations, especially in prequalification. Relative to prequalification volume, shopping activity has been healthy and to date we have not seen much incremental pressure from the extension of the GSE prequalification program. We are pleased with the strong mortgage growth in the quarter, but given uncertainty around interest rates, origination volumes and uptake of these newer prequalification programs, we continue to take a conservative view on our mortgage guidance for the year. On a trailing 12 month basis, mortgage represented about 8 8% of total TransUnion revenue. Let me now turn to our emerging verticals, which grew 4% in the quarter. Speaker 300:23:27Insurance, Media, Public Sector and Collections led the way for growth. Telecommunications in Tech, Retail and E Commerce grew modestly, while tenant and employment screening declined as expected. Our appendix slide provides helpful detail on the relative sizing of each of these verticals. In insurance, we delivered improved growth with market trends progressing as expected to start the year. Select underwriters are starting to resume marketing activity as rate adequacy improves with broader recovery expected as the year progresses. Speaker 300:24:06Healthier Backdrop supports credit based marketing volume as well as increased demand for our suite of marketing products such as identity based data hygiene and targeted audience solutions. Consumer shopping activity remains strong. We continue to deliver significant new business wins across our core products as well as with innovative products like TruVizion Driving History, successful cross selling of NuStar and Sontiq Solutions and penetration of the life and commercial insurance market. Media, Public Sector and Collections all grew double digits. Media benefited from marketing identity and audience wins and a stabilizing market backdrop. Speaker 300:24:56Public Sector and Collections were again powered by strong growth in Trusted Call Solutions along with fraud volumes in the public sector. Telco was up slightly in line with the recent trajectory and our growth expectation for the vertical, which includes many of our legacy communication solutions like landline caller ID. Tech, retail and e commerce was also up modestly as it comped against project based revenue in the prior year. Tenant and employment screening declined as expected as we work through the recalibration of our solutions. We expect better performance in the second half of the year as we lap the impact of these actions. Speaker 300:25:45Turning to Consumer Interactive, revenue decreased 2%. Our indirect channel grew benefiting from continued breach wins. Breach revenues can be uneven, but we are accelerating our pace of wins largely on the strength of Sonic offerings. Our direct business declined as expected as we work through the impact of our recalibrated marketing strategy. We are making good progress on broadening our value proposition and go to market strategy in this business. Speaker 300:26:18For my comments about international, all revenue growth comparisons will be in constant currency. For the total segment, revenue grew 15% with 4 of our 6 reported markets growing by double digits. Adjusted EBITDA margin was 45.2%, up 2 30 basis points. Now let's dig into the specifics for each region. In India, we grew 31%. Speaker 300:26:45We delivered growth across consumer credit, commercial credit, fraud, marketing and direct to consumer supported by strong market trends. In the U. K, revenue was flat. The U. K. Speaker 300:26:59FinTech market remained subdued but has stabilized and we continue to see solid growth in banking and insurance setting us up for some improvement as the year progresses. Offerings continue to drive new wins. Canadian business delivered another quarter of very strong performance, growing 18% despite a muted macro environment. We benefited from share gains services, strong growth in telco and insurance, momentum in consumer and direct and recent breach wins. Growth in Canada was also a bit better than anticipated due to healthier online volumes. Speaker 300:27:46Looking ahead, as we lap sizable new business wins, we expect growth in subsequent quarters to return to high single digits, which still represents market leading performance in Canada. In Latin America, revenue was up 7%. Colombia and other Latin America countries, we delivered broad based growth with stabilizing market conditions after a softer second half twenty twenty three. Brazil was flat after a few quarters of declines and we expect further improvement as the year progresses. In Asia Pacific, we grew 17% driven by very strong growth in the Philippines and another solid quarter in Hong Kong. Speaker 300:28:29Finally, Africa increased 12% led by our retail and insurance verticals. Turning to the balance sheet, we ended the quarter with roughly $5,300,000,000 of debt and $434,000,000 of cash. We finished the quarter with a leverage ratio of 3.5 times. You can find our debt profile in the appendix of our presentation. We did not make debt prepayments in the Q1, but expect to make some prepayments over the course of 2024 with our excess free cash flow. Speaker 300:29:09Our focus this year remains on executing against the transformation initiatives. We expect most of our $355,000,000 to 3 $75,000,000 of one time transformation expense to be paid out in 2024. Based on our expectation for adjusted EBITDA and cash generation, we expect our leverage ratio to be in the low three times range by the end of 2024. We continue to work toward our leverage ratio target of under 3 times. Do not view 3 times as an ending point for deleveraging and view debt prepayment as an attractive incremental use of our cash over the medium term. Speaker 300:29:51Turning to guidance. Even after a strong start to the year, our approach remains unchanged. We continue to assume muted economic growth throughout 2024 with steady lending volumes and no benefit from interest rate cuts. That brings us to our outlook for the Q2 of 2024. We expect foreign exchange to have an insignificant impact on revenue and adjusted EBITDA. Speaker 300:30:20We expect revenue to be between $1,017,000,000 and 1 point $26,000,000,000 or up 5% to 6% on an as reported and organic constant currency basis. Our revenue guidance includes approximately 3 points of tailwind from mortgage, meaning that we expect the remainder of our business to grow 2% to 3% on an organic constant currency basis. We expect mortgage revenue growth in the second quarter to be slightly lower than the 52% we experienced in the 1st quarter. We expect adjusted EBITDA to be between $366,000,000 $372,000,000 up 8% to 10%. We expect adjusted EBITDA margin of 36.0 percent to 36 point 3 percent or up 90 to 120 basis points. Speaker 300:31:14We also expect our adjusted diluted earnings per share to be between $0.95 $0.98 up 11% to 14%. Turning to the full year, we expect insignificant impact from foreign exchange on revenue and adjusted EBITDA. We expect revenue to come in between $4,023,000,000 $4,083,000,000 or up 5 percent to 6.5% on an as reported and organic constant currency basis. Our increased guidance is driven entirely by mortgage, specifically from better than anticipated price realization on 3rd party scores and credit reports. 2024, our mortgage inquiry assumption is unchanged at down 5%. Speaker 300:32:07However, we now expect our mortgage revenue to increase about 50%, up from 25% prior. We now expect inquiries to be slightly better in the first half of the year, but still down 10% and for the second half volumes to be flat. We expect our organic constant currency growth excluding mortgage to be up about 2% to 3.5%. We are pleased with our non mortgage outperformance in the Q1, but continue to take a deliberately conservative approach to the rest of the year given continued market uncertainty. For our business segments, we expect U. Speaker 300:32:50S. Markets to grow mid single digit or up low single digit excluding mortgage. Now anticipate Financial Services to be up low double digit or low single digit growth excluding mortgage. We continue to expect emerging verticals to be up low single digit and we expect consumer interactive to decline low single digit. We now anticipate that international will grow low double digit in constant currency terms driven by broad based positive trends and led by India. Speaker 300:33:29Turning back to the total company outlook, we expect adjusted EBITDA to be between 1.433 $1,475,000,000 up 7% to 10%. That would result in adjusted EBITDA margin being 35.6% to 36.1% or up 50 to 100 basis points. Anticipate adjusted diluted earnings per share to be 3.69 dollars to $3.86 up 10% to 15%. We expect our adjusted tax rate to be approximately 22.5%. Depreciation and amortization is expected to be approximately $530,000,000 and we expect the portion excluding step up amortization from our 2012 change in control and subsequent acquisitions to be about 2 $45,000,000 Anticipate net interest expense will be about $250,000,000 for the full year, up $5,000,000 from prior guidance due to higher sulfur. Speaker 300:34:34We expect capital expenditures to be about 9% of revenue. And as previously noted, we continue to expect to incur $200,000,000 in one time charges in 2024 related to our transformation program. I'll now turn the time back to Chris for some final comments. Speaker 200:34:54Thank you, Todd. And to wrap up the call this morning, we exceeded 1st quarter expectations driven by mortgage outperformance, international momentum, good growth from key emerging verticals like insurance and media and stable lending volumes in the U. S. Financial Services. We achieved key milestones against our transformation program, reinforcing our confidence in delivering against our financial commitment. Speaker 200:35:21And we're raising our 2024 guidance behind the strong first quarter results and better mortgage price realization. We remain focused and confident in delivering strong results in the current low growth market environment. Now let me turn it back to Greg. Speaker 100:35:38That concludes our prepared remarks. For the Q and A, we ask that you each ask only one question so that we can include more participants. Operator, we can begin the Q and Operator00:35:47A. Thank Today's first question comes from Andrew Steinerman with JPMorgan. Please go ahead. Speaker 400:36:16Hi, Chris. I was encouraged to hear that NuStar remains on track and that communications, marketing and risk all contributed. I was hoping you could just give us some more details on kind of the current trend in NuStar and aspirations there? Speaker 200:36:34Yes, sure. And good morning, Andrew. Yes, NuStar posted a solid Q1, very consistent with our full year guide and we had positive growth across each of the 3 principal product lines. Directionally, communication still is posting the highest growth rates and that's driven by our suite of trusted call solutions and new sales of that continue to be very strong. So that's encouraging. Speaker 200:37:05We also feel good about the rate of growth in marketing. This quarter was particularly strong in marketing and we called out the media vertical. That reflects some of the big sales that we had in the media vertical last year. We had a couple of clients in particular that consolidated their business on our audience platforms, which is encouraging. And in the Q1, we will start to lap those sales from last year in the Q2, right, but it was a standout in the first quarter. Speaker 200:37:41And then we've had some acceleration this year in the riskfraud portion of Neustar, particularly around our collections and communication solutions. So from a revenue perspective, was quite solid and we feel solid in the guide for the year. I think it's also important to note in terms of NuStar progress, we're still really confident on achieving the integration savings. We raised up to $80,000,000 We feel very good about that. And of course, we're striving to outperform that number and I'll keep you updated as the year progresses. Speaker 200:38:19Beyond that, there's a ton of technology benefit that we are taking advantage of currently. We've talked about OneTrue as our central data management platform and OneTrue began, of course, within Neustar as their next generation platform and we've extended it to meet the broader TransUnion enterprise needs. But in addition to OneTrue, over these past couple of years, we've done a ton of work to integrate our marketing and fraud solutions. And when you do this type of hardcore engineering integration, you move sideways from a product and innovation perspective for a period. But once you pulled everything together, you get a broader and more integrated solution, truly the best of both organizations. Speaker 200:39:05And we expect that work in marketing and fraud to be behind us as we enter in the second half and the third quarter of this year. So in my view, while we're posting good results in NuStar in a difficult environment, the best in terms of our product offering has yet to come and you're going to see that emerge later this year. Speaker 400:39:28Thank you, Chris. Operator00:39:31Thank you. The next question is from Faiza Alwy with Deutsche Bank. Please go ahead. Speaker 500:39:37Yes. Hi. Thank you. Good morning. I wanted to ask about mortgage since that's what's driving the guidance raise. Speaker 500:39:46I guess what was better than what you had anticipated in mortgage? I know you mentioned the pre call volumes and shopping behavior. But I guess what drove the pricing? And what gives you confidence that sort of this level of outperformance will continue through Speaker 600:40:06the course of the year? Yes. Speaker 200:40:08And thanks for the question, Faiza. It's a very essential to understanding both the quarter and the full year guide. As we were budgeting and forecasting 'twenty four, it was complicated because there are a lot of moving parts in the forecast given interest rates and market volume uncertainties, but also the new early assessment program by the GSEs, which was likely going to have an impact on mortgage prequalifications. Consistent with our overall conservative guidance posture, we were conservative on all of these dimensions of mortgage guide. Now what we saw in the Q1 is that volumes were a little better than expectations, but not hugely better and just absolute mortgage volume is a difficult thing to predict as we all know. Speaker 200:41:04But the assumptions we made about the proportion of pre qualifications that we would get and the 3rd party score price we would realize on those pre qualifications as well as the price realization of the credit portion, those all those assumptions turned out to be conservative, right. So in addition to that, we think and this is really our hypothesis is that now that mortgage lenders don't have to pull 3 credit reports and incur that cost of 3 reports and 3 scores at qualification, it's enabling some additional consumer shopping. So there may be some benefit coming from that as well because our qualification volumes were again beyond the conservative forecast that we put in place. So the combination of all of those things led to material outperformance in mortgage. We booked what we achieved in the Q1, and then we maintained or actually made a bit more conservative the volume expectations for the remainder of the year simply because it's a fluid market. Speaker 200:42:22There's a lot of uncertainty and there have been a lot of changes. Now, Todd, I think you can probably get into some more of the specifics here. I think that would be helpful. Absolutely. Speaker 300:42:33So Faiza, thanks for the question. And one point that I want to start with just to make certain that's clear to everyone is that TransUnion includes the prequalification volumes that Chris was just speaking about in our including the prequal. So what that means when Chris is talking about shopping activity being better, you have to keep that in mind that that's in essence one of the drivers that we saw to keep the expectations on volumes a little bit better from what we had guided. So from there, if you look at our guidance back in February, compared to what we've put out this morning, Starting with revenue, you'll notice that we've increased the revenue by 25%. So now we're expecting mortgage to grow 50% instead of 25%. Speaker 300:43:30But back to the volumes, we are expecting volumes for the full year to remain the same at down 5%. Now in the first half, we are expecting the volumes to be a little bit better. Back in February, we had assumed a 15% decline and now we are assuming a 10% decline. So in essence, you get a 5% pickup in the first half. Prequalification is a part of that. Speaker 300:43:59So keep that in mind. But then in the second half, if you go back to February, we were anticipating that we would grow 10% in our volumes. And that was just purely comparables. If you remember the second half of twenty twenty three was particularly weak. So what we've done is we've changed our second half assumption in essence to be flat. Speaker 300:44:20So what that means is second half now has a decline of 10%. So the reason that that's important to call out is we are fully acknowledging the headwinds that we are experiencing in the market from a volume perspective with the 10 year treasury yield creeping up and 30 year mortgage rates higher, we are acknowledging that in our forecast. So the takeaway here is that this is just better price realization on 3rd party scores as well as reports. Speaker 500:45:03Great. Thank you so much. Operator00:45:06Thank you. The next question comes from Jeff Meuler with Baird. Please go ahead. Speaker 700:45:12Yes. Thank you. Good morning. So Q2 guidance looks good. You just addressed mortgage, but maybe if you can more holistically kind of just address this concern that when rates moved higher kind of last summer, early fall, it created some incremental headwinds in various parts of your business. Speaker 700:45:32So just with rates moving higher recently, including again today, can you just talk about some other parts of the business where you saw headwinds last fall and maybe any sort of like changes in customer behavior or tone that you're hearing more recently on the back of a rate increase? Thanks. Speaker 300:45:53Hey, good morning, Jeff, and thank you for the question. So to start off in response to that, I think what's important for everyone to remember that our initial guide back in February did not anticipate a benefit from lower interest rates. So we went into the year, in essence, just very conservative. We didn't want to get ahead of ourselves and that proves to be a very good thing, right, as far as where interest rates appear to be headed. Trends in our core U. Speaker 300:46:27S. Financial Services business, I would say that they remain stable. You've heard from some of the bank earnings calls, they used the word subdued. I think that we have appropriately captured these trends in our outlook. There's no significant upside contemplated there. Speaker 300:46:48It's more of a continuation of the trends that we're seeing. Now some important reminders, TransUnion obviously has a very diversified portfolio. And as a reminder, in 20222023, we grew 3% in both years. Now clearly, that's not what we plan for and that's not at all what we aspire for, but it shows the balance of the business and that's intentional. So and with that also, we currently believe that interest rates perhaps may have peaked or maybe they won't go up much further. Speaker 300:47:30So what does that mean? Well, what it does is it drives certainty that didn't exist for our customers in the previous 2 years when interest rates were increasing in 2022 into 2023. Our customers didn't know how much higher that they were going to go. So there's definitely some certainty there. Also, it's important to call out that our international business just continues to have strong momentum. Speaker 300:48:01In our February guidance, we called for high single digit growth from that business. We've increased that even though we're maintaining in total at the company level, we've increased to low double digits for international just based on this strong momentum that we're seeing in international. Flip back to the U. S. Markets, the emerging verticals, it's important to call out there that many of those businesses are less dependent on interest rate movements. Speaker 300:48:30And this gets back to what I said at the beginning about the power of the diversified portfolio that we have. And I would say we're seeing improving trends there, nothing dramatic, but things are starting to get better. And then the last point I would make on this one is cutting across all of these businesses, TransUnion has a robust portfolio of solutions to help our customers, no matter what the macro environment presents them? Speaker 200:49:05Yes. Look, if I can reinforce a couple of points, the volumes that we experienced in the Q1, particularly in U. S. Financial Services are consistent with the Q4 of last year. The challenge is, as you know, Jeff, in September of Q3 of last year, the combination of increased rates and a real stress on bank deposits led to a material step down in origination volumes, right? Speaker 200:49:33Well, that appears to be flattening and therefore our growth is going to improve because we're not absorbing any material declines as we did in the second half of twenty twenty three. Thank you. Operator00:49:47Thank you. The next question is from Manav Patnaik with Barclays. Please go ahead. Speaker 800:49:52Thank you. 4 big categories in there, if you could just help us with how much they grew in 'twenty three and how we should think about what you've factored in for 'twenty four? Speaker 200:50:15Yes. Look, let me provide some quick color. And I don't Todd may recall the specific growth rates per emerging segment in 'twenty three, but I'm more 'twenty four focused. And look, overall, we're expecting higher growth from the emerging verticals in '24 than we experienced in 'twenty three. Starting with insurance, I think I said on an earlier call that we expected insurance to grow faster in 'twenty four, but not to return to the high single digit growth that we've enjoyed consistently. Speaker 200:50:52So it's a healing process in terms of insurers returning to former marketing levels. We've seen some improvement in marketing. Of course, we've also had some really nice wins, particularly in the driver risk. So insurance is solid. As we mentioned, we had a solid growth in media and that's because of the realization of some customer wins that we achieved last year. Speaker 200:51:16Public sector, our fraud products are helping us grow there. And finally, Manav, we're getting some nice growth in the collections area, right? As delinquencies rise, part of the compensation for our business model is increased collections and of course, Trusted Call Solutions is a growth driver across all of these segments. In technology and real estate, in e commerce, we're lapping some major project revenue. We're getting growth there, but it's more like the low mid single digit type of growth. Speaker 200:51:48And communications is always a blend. It's a combination of some heritage products that are either flat to declining slightly, but enhanced considerably by the Trusted Call Solutions Suite. And then we are still working our way through some difficult comps on tenant and employment screening. As you know, because of the consent order that we signed with the CFPB last year, we've had to take certain products, certain data that did not meet the enhanced requirements that the CFPB has imposed on the industry. We had to take those out of the market. Speaker 200:52:25We'll lap that comp by the second half of the year, but for right now, it's negative and a drag on emerging. So hopefully that helps Manav. Operator00:52:37Thank you. The next question comes from Kelsey Xu with Autonomous. Please go ahead. Speaker 600:52:43Hi, good morning. Thanks for taking my question. I was wondering if we can also talk a little bit about the growth we should expect for Sontiq and Argus in 2024 and how their margin profiles look like right now and kind of where you're targeting for 2024? Thank you. Speaker 200:53:05Yes. So let's see, SonTek and then Argus. Well, the quick news on Argus, I think is Argus has been completely integrated into the credit card and banking vertical within U. S. Markets. Speaker 200:53:24And we've spent a lot of time on the next generation platform, but also a lot of data hygiene and enhancement. So we've built a nice pipeline. We're getting some new sales and some conversions. And I continue to be very pleased that we've added this deeper, more authoritative view on how consumers are actually using their card through our overall foundation of credit information. Sontiq is growing very well. Speaker 200:53:58The key driver in Sontiq has been breach. As you know, in the Q4, we reported really strong growth in consumer, but it was almost entirely fueled by some breach revenues. So now that we've kind of matured our ability to sell this, I expect that we're going to continue to get good growth. But again, that is a more lumpy episodic type of product line, right. And so as we forecasted SonTek for the year, we forecasted very solid growth from Sontiq, but not an extrapolation from what we experienced in the Q4 and a bit in the Q1 of this year. Operator00:54:43Thank you. The next question is from Toni Kaplan with Morgan Stanley. Please go ahead. Speaker 900:54:49Thanks very much. I was hoping to ask about technology. You talked about the tech transformation, but just any update on AI and cloud, where you are today, any metrics we should be sort of looking at with regard to that and expense efficiencies and anything related? Thanks. Speaker 200:55:14Yes. So let me survey the landscape on technology because multiple efforts that really check the boxes that you've talked about have converged into our next generation foundational data management platform, which is 1 true. And think of that as all of the different data assets that we have, whether they be credit or marketing or fraud mitigation or public records are converging on a common set of functionality within OneTrue. Now part of that is data ingestion, identity resolution, basic analytics and certainly feeding all of that into the different product suites that we have, be it credit marketing, public records, fraud, etcetera, right? And I think we've provided some schematics, so you can better understand that. Speaker 200:56:12But underpinning 1 true, we're using machine learning, variance of artificial intelligence to speed the ingestion of data, the quality assurance, the governance, certainly the identity resolution. We're even launching a machine learning as a service in our enhanced analytics suite. So, One True now think of it as a comprehensive umbrella effort that's going to give us the type of one to many leverage from our technology that we've been steering toward. And of course, it's an entirely cloud architected, cloud native platform. All the data is stored within a fabric in the cloud or a common central repository, if you will. Speaker 200:57:00And it's also designed to be cloud agnostic because not all of our applications will go to the cloud. The majority of them will because the economics and the performance requirements make sense. But there are certain loads that we can handle more cost effectively in our internal private clouds, right. So as we've explained, there's a division there and we've talked about that previously. So hopefully that gives you some more flavor. Speaker 900:57:28Super, thanks. Operator00:57:31Thank you. The next question comes from Heather Balsky with Bank of America. Please go ahead. Speaker 1000:57:37Hi. Thanks for taking my question. I wanted to ask you about insurance and I know it's come up already on the call with regards to marketing. But I'm curious about kind of the other aspects of the business in terms of what you've been seeing in terms of insurers leaving state, what's going on with shopping. It seems like the data that you guys put out, it was pretty good for the quarter. Speaker 1000:58:02Just the broader environment for insurance and how you think about that for the rest of the year? Thanks. Speaker 200:58:09Yes, Heather. It's probably worth refreshing kind of the basic dynamics that we're seeing in the insurance space. And look, as we all know, the past couple of years have been very tough for insurers. There's been an increase in frequency and severity of events and the replacement costs have skyrocketed and it's led P and C carriers pulling back from higher risk regions, whether that's from wildfires or flooding or just a variety of natural disasters. And that's meant reduced underwriting volumes. Speaker 200:58:45And what is underwritten is that at materially higher prices often that has to be absorbed by consumers, and also a reduction of marketing until the insurers could get a number of rate increases through different states in order to turn profitable on kind of individual policy economics. There's been a lot of progress in getting insurance priced right for this more challenging environment. And so we are seeing an increase in marketing, but still, the space is not fully healed, if you will. And I think that's going to take more time, probably another year, but we do expect 2024 to be stronger on balance in insurance than 'twenty three was. You also mentioned shopping activity and you're right and this is probably something that we all have some personal experience with. Speaker 200:59:40Upon renewal, consumers get sticker shock. And against the price increases have been material for all the reasons that I talked about. And that does lead to some more shopping and shopping helps our business model. The other thing that's helping is a bit of an improved marketing environment and the continued growth of our driver's risk solutions as insurers are looking for ways to combat the increasing prices of state motor vehicle reports. Operator01:00:11That's really helpful. Thank you. Thank you. Today's last question comes from Ashish Sabadra with Deutsche Bank. Please go ahead. Speaker 1101:00:21Thanks for taking my question. I just thanks for providing those details around the India market. That's very encouraging. I just wanted to drill down on the international in general, very strong momentum in the Q1. The guidance also implies strong growth, but does moderate. Speaker 1101:00:37I was just wondering if you can talk about puts and takes and any kind of conservatism that's baked into the guidance? Thanks. Yes. Speaker 201:00:44Well, I would say our international forecast in total does reflect a similar prudent approach that we've tried to take across the enterprise. Obviously, we're really pleased with the Q1, but we were careful not to extrapolate from those results across the full year. Canada, in addition to India, is a real call out for many, many years now that team has executed well, has won a lot of customers, has further penetrated the entirety of the customer base with a range of solutions and has been posting outside growth. We're doing great in South Africa and across Africa broadly. And again, India is a huge standout and a privilege for TransUnion to be able to participate in. Speaker 201:01:37Asia Pacific has also had a great rebound. We're seeing exciting things in the Philippines. We're very bullish about the potential for developing our franchise there. And LatAm is doing well and we hope and expect to prove better results in Brazil. And look in the UK, the UK has been a tough slog. Speaker 201:01:58That economy has been through a lot. Inflation and interest rates have been very high. And we were probably overweighted there more toward short term money lenders and FinTech, which have had a particularly hard time these past couple of years. Now that that's kind of flattening out, the robust growth we've been enjoying in kind of core mainstream banking is going to start to shine through as well as some of the diversifications into the So Hopefully, I didn't leave anybody out as I went around the horn here. Apologies, no offense intended if I have. Speaker 201:02:37But look, international is rolling well and we expect to continue to post really good results this year. Great. Speaker 301:02:47That brings us to the end of today's call. Thank you for Speaker 101:02:51your time today and have a Speaker 301:02:52great rest of the day. Thanks. Operator01:02:56The conference has now concluded. Thank you for your participation. You may now disconnect your lines.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallTransUnion Q1 202400:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) TransUnion Earnings HeadlinesRedburn Atlantic Cuts Earnings Estimates for TransUnionApril 20 at 2:02 AM | americanbankingnews.comData & Business Process Services Stocks Q4 Results: Benchmarking TransUnion (NYSE:TRU)April 18 at 6:23 PM | finance.yahoo.comNow I look stupid. Real stupid... I thought what happened 25 years ago was a once- in-a-lifetime event… but how wrong I was. Because here we are, a quarter of a century later, almost to the exact day, and it’s happening again. April 20, 2025 | Porter & Company (Ad)Analysts Offer Insights on Industrial Goods Companies: Air New Zealand Limited (OtherANZFF) and TransUnion (TRU)April 17 at 8:16 AM | markets.businessinsider.comK2 Cyber Partners with TransUnion to Deliver Cybersecurity Protection and ServicesApril 16, 2025 | businesswire.comWells Fargo & Company Issues Pessimistic Forecast for TransUnion (NYSE:TRU) Stock PriceApril 16, 2025 | americanbankingnews.comSee More TransUnion Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like TransUnion? Sign up for Earnings360's daily newsletter to receive timely earnings updates on TransUnion and other key companies, straight to your email. Email Address About TransUnionTransUnion (NYSE:TRU) operates as a global consumer credit reporting agency that provides risk and information solutions. The company operates through U.S. Markets, International, and Consumer Interactive segments. The U.S. Markets segment provides consumer reports, actionable insights, and analytic services to businesses, which uses its services to acquire new customers; assess consumer ability to pay for services; identify cross-selling opportunities; measure and manage debt portfolio risk; collect debt; verify consumer identities; and mitigate fraud risk. This segment serves various industry vertical markets, including financial services, technology, commerce and communications, insurance, media, services and collections, tenant and employment, and public sectors. The International segment offers credit reports, analytics, technology solutions, and other value-added risk management services; consumer services, which help consumers to manage their personal finances; consumer credit reporting, insurance and auto information solutions, and commercial credit information services. It serves customers in financial services, retail credit, insurance, automotive, collections, public sector, and communications industries through direct and indirect channels. The company was formerly known as TransUnion Holding Company, Inc. and changed its name to TransUnion in March 2015. TransUnion was founded in 1968 and is headquartered in Chicago, Illinois.View TransUnion ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Archer Aviation Unveils NYC Network Ahead of Key Earnings Report3 Reasons to Like the Look of Amazon Ahead of EarningsTesla Stock Eyes Breakout With Earnings on DeckJohnson & Johnson Earnings Were More Good Than Bad—Time to Buy? 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There are 12 speakers on the call. Operator00:00:00Hello, and welcome to the TransUnion First Quarter 2024 Earnings Call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions. As a reminder, this conference is being recorded. I would now like to hand the call to Greg Barty, Vice President, Investor Relations. Operator00:00:36Please go ahead. Speaker 100:00:39Good morning and thank you for attending today. Joining me on the call are Chris Cartwright, President and Chief Executive Officer and Todd Sello, Executive Vice President and Chief Financial Officer. We posted our earnings release and slides to accompany this call on the TransUnion Investor Relations website this morning, and they can be found in the current report on Form 8 ks that we filed this morning. Our earnings release and the accompanying slides include various schedules, which contain more detailed information about revenue, operating expenses and other items, as well as certain non GAAP disclosures and financial measures, along with the corresponding reconciliation of these non GAAP financial measures to their most directly comparable GAAP measures. Today's call will be recorded and a replay will be available on our website. Speaker 100:01:26We will also be making statements during this call that are forward looking. These statements are based on current expectations and assumptions and are subject to risks and uncertainties. Actual results could differ materially from those described in the forward looking statements because of factors discussed in today's earnings release, in the comments made during this conference call, and in our most recent Form 10 ks, Forms 10 Q and other reports and filings with the SEC. We do not undertake any duty to update any forward looking statement. With that, let me turn it over to Chris. Speaker 200:02:03Thanks, Greg, and let me add my welcome and share our agenda for the call this morning. First, I'll provide the highlights of our Q1 2024 results, including an update on our progress against our transformation initiatives. 2nd, I will discuss our India growth story. And finally, Todd will detail our first quarter and full year 2024 guidance. In the Q1, TransUnion significantly exceeded guidance across revenue, adjusted EBITDA and adjusted diluted earnings per share. Speaker 200:02:39Given the strength in the quarter, we are raising our full year 2024 guidance, which Todd will describe later, while still maintaining a conservative guidance posture given still tepid market conditions and macroeconomic and geopolitical uncertainties. Revenue in the quarter exceeded $1,000,000,000 for the first time in the company's history, growing 8% plus on an organic constant currency basis, well above our 3% to 4% guidance. Mortgage drove much of the outperformance due to better than expected 3rd party score and credit report price realization as well as slightly better pre qualification volumes. We expect much of the pricing benefit to persist throughout the year, increasing our expectation for mortgage growth. However, our mortgage volume assumption remains conservative as in February. Speaker 200:03:34And in fact, we have trimmed volume expectations for the second half of the year despite the strong start to provide further cushion against an uncertain mortgage market backdrop. Our organic constant currency growth excluding mortgage of 5% also exceeded our expectations led by international as well as key emerging verticals such as insurance, media, public sector and collections. U. S. Markets grew 7% with financial services up 13% and emerging verticals up 4%. Speaker 200:04:10Consumer Interactive declined 2% as expected. Consistent with the 4th quarter, muted but stable economic conditions and lending volumes supported financial services growth. Consumer finances in the U. S. Remained healthy due to low unemployment and real wage growth. Speaker 200:04:30Inflation is moderated, but remains above target and market expectations have reverted to higher for longer interest rate forecasts. Lending standards remain tight as lenders face potentially increasing capital requirements as well as rising delinquencies, albeit still within historical averages. The banks echoed these sentiments during recent earnings calls, reporting subdued loan and deposit growth as they balance consumer resiliency against continued market uncertainty. Within U. S. Speaker 200:05:05Markets, NuStar delivered another good quarter and we remain on target to grow mid single digits in 20 24. Communications, marketing and risk all contributed led by robust growth in Trusted Call Solutions. Our International segment grew by 15% on a constant currency basis, the 12th consecutive quarter of double digit growth. India led with 31% growth, while Canada, Asia Pacific and Africa again grew double digits. Finally, we achieved key milestones in our transformation program, reinforcing our confidence in delivering against our financial commitments. Speaker 200:05:46Let me address this in more detail. As we discussed last quarter, our transformation efforts comprised 2 complementary programs, optimizing our operating model by further leveraging our Global Capability Centers or GCCs and modernizing our technology capabilities. We believe these initiatives will accelerate innovation, streamline workflows, reduce costs and ultimately position us to deliver better experiences to meet the evolving needs of customers and consumers. In our operating model optimization program, we substantially completed our local market workforce reductions and migration notices in the Q1. Concurrently, we're on track with our planned GCC hiring. Speaker 200:06:33We now have roughly 4,900 employees and our talent acquisition in India, South Africa and Costa Rica is stronger than ever. As more work shifts to the GCCs, we're taking a rigorous approach to change management, systematically tracking and documenting knowledge transfer, training our leaders to manage increasingly global teams and developing a feedback loop to improve processes continuously. We're also deliberately balancing the need for customer centric work in markets with the opportunity to centralize, standardize and automate key global functions. In our technology program, we're modernizing our capabilities by completing our cloud transformation and leveraging Neustar's technology to consolidate the assets we've built and acquired in recent years onto OneTrue, a common state of the art solutions enablement platform. OneTrue is becoming the platform for ingesting, managing, governing, analyzing and delivering data and insights. Speaker 200:07:39The OneTrue platform integrates separate data and analytic assets in credit risk, marketing and fraud prevention and concentrates them in a single layered and unified environment. We believe that OneTru will enrich our data quality, speed time to market and accelerate innovation, ultimately driving better growth across our credit fraud and marketing solutions. From a financial perspective, we expect OneTrue will also save costs and enable us to rationalize applications and standardize global services. These efficiencies will allow our engineers to focus more time on innovation. Finally, the standardized operating model will enable us to adapt more quickly to rapidly changing regulations and ensure compliant data usage. Speaker 200:08:29Our focus in 2024 2025 is in consolidating our U. S. And India products, data and analytics onto the platform in accordance with respective laws and regulations. We made meaningful progress in the Q1. We launched advanced acquisition in the U. Speaker 200:08:49S, which combines data enrichment with our credit and marketing capabilities for an integrated credit based consumer prospect marketing solution. We also moved key capabilities of our short term lending credit bureau, Factor Trust, onto 1 True with full online solutions to follow, representing the 1st credit bureau applications OneTru as well as our core U. S. Credit onto OneTrue over the next several quarters. These actions reinforce our confidence in delivering an expected $65,000,000 of operating expense savings in 2024, And we continue to target $200,000,000 of free cash flow benefit by 2026. Speaker 200:09:45Now over the last 2 decades, TransUnion has built a leadership position in India, one of the most attractive global markets. We've grown our Indian business more than 30% every year since 2017, except for the pandemic here in 2020. And this market contributed roughly 1.5 points to total company growth in 2023. We have a tremendous long term opportunity to enable growth in the Indian market. India is the 5th largest economy in the world and the fastest growing with GDP expected to drop double by 2,030. Speaker 200:10:212 thirds of India's population is under the age of 35. And this segment alone comprises 890,000,000 people, more than 3 times the size of the U. S. Adult population. These demographics drive economic growth and needed sophisticated consumer credit system to support an expanding aspirational middle class. Speaker 200:10:43Indian government remains highly focused on modernizing its economy, promoting financial inclusion and digital transformation initiatives. India's evolving economy creates high demand for credit, marketing and fraud solutions and we have built a unique market leading business. The credit bureau TransUnion Civil was founded in 2000 and has become a household brand that is synonymous with credit reports. We have 640,000,000 consumer records in our bureau, growing roughly 15% each year. We serve more than 6,000 institutions, including the largest banks, non banking financial institutions, Fintechs and insurance companies. Speaker 200:11:26We also reach 100,000,000 consumers directly through our consumer solutions. As the leading credit bureau, we play an impactful role in the Indian credit economy. We closely engage with the regulatory and government institutions such as the Reserve Bank of India and the Ministry of Finance to support initiatives focused on managing financial stability and systemic risk, as well as driving financial inclusion. We also improved financial literacy through our education and awareness programs and our direct connections with more than 100,000,000 consumers. And as I will describe in more detail later, we enable credit penetration in critical underserved areas such as small and midsized businesses, agriculture and microfinance. Speaker 200:12:16Our strategy in India exemplifies our enterprise vision to make trust possible between consumers and businesses in global commerce. India's market dynamics by themselves drive attractive growth with GDP growing nearly 8% and credit growing roughly 16% in 2023. We expect strong volumes again in 2024, albeit with likely lower growth rates as the lending ecosystem takes a modestly more conservative stance. We have consistently outperformed the underlying market. However, driven by the same growth playbook that we use across our business. Speaker 200:12:551st is client engagement or deepening client shift. We empower our verticalized sales force to focus on thematic selling, emphasizing our role as a trusted advisor to our clients. This enables us to build upon our already strong share in core consumer credit by expanding our suite of solutions and penetrating new lenders. 2nd is product innovation. Successfully bring innovation from other markets to India, such as trending credit data and consumer education tools. Speaker 200:13:31Increasingly, we're driving in market innovation like our API Marketplace and in areas such as financial inclusion, fraud and identity and open banking. We're also exploring opportunities to bring NuStar capabilities such as trusted call solutions and marketing products to the Indian market. 3rd is market adjacencies or India's version of emerging markets. Key focus areas are commercial, FinTech and direct to consumer. Commercial credit is unique to India as we do not operate a commercial bureau in the U. Speaker 200:14:08S. We help Indian lenders assess the creditworthiness of businesses based on credit as well as bank statement, tax and trade data. From 2018 to 2023, we grew in India at a 27% compound annual growth rate. And the chart on Slide 9 highlights how the growth playbook enabled this market leading performance. Consumer credit grew at a 23% CAGR, commercial Fintech and direct to consumer grew to faster combined 36% CAGR and now represent roughly 40% of revenue. Speaker 200:14:44We believe over time our solutions outside of consumer credit can contribute 50 percent plus of our Indian revenue. We're only scratching the surface of the opportunities outside of consumer credit with the right to win given our scale and brand recognition, our breadth and the quality relationships that we have in the market as well as product innovation. Much of our next generation of innovation focuses on enabling credit penetration in underserved sectors, all of which the government of India has identified as key economic growth priorities. Our fit rank assessment uses credit and alternative data for sharper risk differentiation of small and midsized businesses. The solution enables lenders to better serve India's 63,000,000 small and medium businesses, which contribute to 30% of India's GDP. Speaker 200:15:40The Civil Credit and Farm Report consolidates credit, satellite and other relevant agricultural data to begin to digitize the historically manual and cumbersome agricultural lending process. Farming is the livelihood of 55% of the Indian population and agricultural loans account for at least 18% of the bank's lending portfolios. And the Civil Microfinance report and SCOR provides comprehensive data and analytics to serve the 70,000,000 microfinance borrowers in India. Microfinance refers to collateral free loans for lower income families. The loans average roughly $500 and typically focus on rural and remote areas. Speaker 200:16:25The Reserve Bank of India has specific mandates for lending to this segment of the population. Closeout, India is a multi decade growth story for TransUnion. At our Investor Day, we targeted $300,000,000 of revenue from India by 2025 and we are well on our pace to exceed that target. We continue to believe this business can deliver conservatively 20% plus growth over the medium term. And our next goal is to build India into a $500,000,000 business over the next several years. Speaker 200:17:00Now Todd will provide further details on the Q1 financial results and our Q2 and full year 2024 outlook. Todd? Speaker 300:17:10Thanks, Chris, and let me add my welcome to everyone. Before I begin, I wanted to highlight our updated segment reporting. Starting this quarter, we are reporting our consumer interactive business within our U. S. Market segment. Speaker 300:17:25Additionally, we have shifted certain revenue between U. S. Financial Services, U. S. Emerging Verticals and our International segment. Speaker 300:17:33These actions better align our reporting to how we run the business under our U. S. Markets and international presidents. We have provided recast 20222023 quarterly results for the updated reporting in an 8 ks filed on Tuesday and have posted the details to our Investor Relations website. Additionally, in the appendix of today's presentation, we have provided incremental vertical revenue mix disclosure for our U. Speaker 300:18:03S. Financial Services, U. S. Emerging Verticals and Consumer Interactive Businesses fiscal year 2023. Chris mentioned in the Q1, we exceeded our guidance on all key financial metrics. Speaker 300:18:171st quarter consolidated revenue increased 9% on a reported basis and 8% on an organic constant currency basis. There was no impact from acquisitions and a less than 1% benefit from foreign currency. Our business grew 5% on an organic constant currency basis, excluding mortgage from both the Q1 of 2023 2024. Adjusted EBITDA increased 11% on a reported and constant currency basis. Our adjusted EBITDA margin was 35.1% ahead of our expectations and up 80 basis points compared to the year ago quarter due to flow through on revenue growth. Speaker 300:19:031st quarter adjusted diluted earnings per share was $0.92 an increase of 14%. The adjusted tax rate for the quarter was 22.5%. Finally, in the first quarter, we took $43,000,000 of one time charges related to the next phase of our transformation program, dollars 24,000,000 for operating model optimization and $19,000,000 for technology transformation. We continue to expect to incur roughly $200,000,000 of one time expenses in 2024, driving $65,000,000 of in year operating expense savings. As part of our 355 $1,000,000 to $375,000,000 program, we expect the remaining $75,000,000 to $95,000,000 of one time expenses to be incurred in 2025. Speaker 300:19:59Looking at segment financial performance for the Q1, U. S. Markets revenue, which now includes Consumer Interactive, was up 7% compared to the year ago quarter. Adjusted EBITDA for U. S. Speaker 300:20:12Markets was up 6% and adjusted EBITDA margin was down 20 basis points to 36.2%. Financial Services revenue grew 13% with trends broadly consistent with the levels seen in the 4th quarter. Excluding mortgage, financial services revenue was up 1%. Consumer lending revenue returned to growth, up 2% in the quarter. Activity remained muted as FinTechs and others remain cautious given rates and market uncertainty. Speaker 300:20:48New customer and wallet share wins across FinTech, buy now pay later and short term lenders offset some of the softness and contributed to growth. Our credit card and banking business was flat. While issuance is healthy on a historical basis, online and batch activity remains tempered as lenders manage rising delinquencies. We are enabling our customers to navigate the current environment and position themselves for future growth with highly relevant products such as our TruVisions risk solutions, TruIQ's analytical suite, Trusted Call Solutions and our true validate fraud offerings. Our auto business grew 2% despite continued headwinds in the auto market, driven by new business wins and growth from captive auto lenders. Speaker 300:21:43Consumers particularly near prime and subprime continue to face affordability challenges from higher interest rates and declining but still high used car prices. Improved new vehicle inventory has provided some increased credit volume as well as interest from OEMs and dealers in non credit solutions as they seek to acquire more customers. We are seeing strong momentum selling NuStar Marketing and Trusted Call Solutions into the auto space. For mortgage, revenue grew 52% against inquiry volume declines of 8%. Outperformance related to higher than expected price realization on 3rd party scores and credit products. Speaker 300:22:34Volumes were also slightly higher than our expectations, especially in prequalification. Relative to prequalification volume, shopping activity has been healthy and to date we have not seen much incremental pressure from the extension of the GSE prequalification program. We are pleased with the strong mortgage growth in the quarter, but given uncertainty around interest rates, origination volumes and uptake of these newer prequalification programs, we continue to take a conservative view on our mortgage guidance for the year. On a trailing 12 month basis, mortgage represented about 8 8% of total TransUnion revenue. Let me now turn to our emerging verticals, which grew 4% in the quarter. Speaker 300:23:27Insurance, Media, Public Sector and Collections led the way for growth. Telecommunications in Tech, Retail and E Commerce grew modestly, while tenant and employment screening declined as expected. Our appendix slide provides helpful detail on the relative sizing of each of these verticals. In insurance, we delivered improved growth with market trends progressing as expected to start the year. Select underwriters are starting to resume marketing activity as rate adequacy improves with broader recovery expected as the year progresses. Speaker 300:24:06Healthier Backdrop supports credit based marketing volume as well as increased demand for our suite of marketing products such as identity based data hygiene and targeted audience solutions. Consumer shopping activity remains strong. We continue to deliver significant new business wins across our core products as well as with innovative products like TruVizion Driving History, successful cross selling of NuStar and Sontiq Solutions and penetration of the life and commercial insurance market. Media, Public Sector and Collections all grew double digits. Media benefited from marketing identity and audience wins and a stabilizing market backdrop. Speaker 300:24:56Public Sector and Collections were again powered by strong growth in Trusted Call Solutions along with fraud volumes in the public sector. Telco was up slightly in line with the recent trajectory and our growth expectation for the vertical, which includes many of our legacy communication solutions like landline caller ID. Tech, retail and e commerce was also up modestly as it comped against project based revenue in the prior year. Tenant and employment screening declined as expected as we work through the recalibration of our solutions. We expect better performance in the second half of the year as we lap the impact of these actions. Speaker 300:25:45Turning to Consumer Interactive, revenue decreased 2%. Our indirect channel grew benefiting from continued breach wins. Breach revenues can be uneven, but we are accelerating our pace of wins largely on the strength of Sonic offerings. Our direct business declined as expected as we work through the impact of our recalibrated marketing strategy. We are making good progress on broadening our value proposition and go to market strategy in this business. Speaker 300:26:18For my comments about international, all revenue growth comparisons will be in constant currency. For the total segment, revenue grew 15% with 4 of our 6 reported markets growing by double digits. Adjusted EBITDA margin was 45.2%, up 2 30 basis points. Now let's dig into the specifics for each region. In India, we grew 31%. Speaker 300:26:45We delivered growth across consumer credit, commercial credit, fraud, marketing and direct to consumer supported by strong market trends. In the U. K, revenue was flat. The U. K. Speaker 300:26:59FinTech market remained subdued but has stabilized and we continue to see solid growth in banking and insurance setting us up for some improvement as the year progresses. Offerings continue to drive new wins. Canadian business delivered another quarter of very strong performance, growing 18% despite a muted macro environment. We benefited from share gains services, strong growth in telco and insurance, momentum in consumer and direct and recent breach wins. Growth in Canada was also a bit better than anticipated due to healthier online volumes. Speaker 300:27:46Looking ahead, as we lap sizable new business wins, we expect growth in subsequent quarters to return to high single digits, which still represents market leading performance in Canada. In Latin America, revenue was up 7%. Colombia and other Latin America countries, we delivered broad based growth with stabilizing market conditions after a softer second half twenty twenty three. Brazil was flat after a few quarters of declines and we expect further improvement as the year progresses. In Asia Pacific, we grew 17% driven by very strong growth in the Philippines and another solid quarter in Hong Kong. Speaker 300:28:29Finally, Africa increased 12% led by our retail and insurance verticals. Turning to the balance sheet, we ended the quarter with roughly $5,300,000,000 of debt and $434,000,000 of cash. We finished the quarter with a leverage ratio of 3.5 times. You can find our debt profile in the appendix of our presentation. We did not make debt prepayments in the Q1, but expect to make some prepayments over the course of 2024 with our excess free cash flow. Speaker 300:29:09Our focus this year remains on executing against the transformation initiatives. We expect most of our $355,000,000 to 3 $75,000,000 of one time transformation expense to be paid out in 2024. Based on our expectation for adjusted EBITDA and cash generation, we expect our leverage ratio to be in the low three times range by the end of 2024. We continue to work toward our leverage ratio target of under 3 times. Do not view 3 times as an ending point for deleveraging and view debt prepayment as an attractive incremental use of our cash over the medium term. Speaker 300:29:51Turning to guidance. Even after a strong start to the year, our approach remains unchanged. We continue to assume muted economic growth throughout 2024 with steady lending volumes and no benefit from interest rate cuts. That brings us to our outlook for the Q2 of 2024. We expect foreign exchange to have an insignificant impact on revenue and adjusted EBITDA. Speaker 300:30:20We expect revenue to be between $1,017,000,000 and 1 point $26,000,000,000 or up 5% to 6% on an as reported and organic constant currency basis. Our revenue guidance includes approximately 3 points of tailwind from mortgage, meaning that we expect the remainder of our business to grow 2% to 3% on an organic constant currency basis. We expect mortgage revenue growth in the second quarter to be slightly lower than the 52% we experienced in the 1st quarter. We expect adjusted EBITDA to be between $366,000,000 $372,000,000 up 8% to 10%. We expect adjusted EBITDA margin of 36.0 percent to 36 point 3 percent or up 90 to 120 basis points. Speaker 300:31:14We also expect our adjusted diluted earnings per share to be between $0.95 $0.98 up 11% to 14%. Turning to the full year, we expect insignificant impact from foreign exchange on revenue and adjusted EBITDA. We expect revenue to come in between $4,023,000,000 $4,083,000,000 or up 5 percent to 6.5% on an as reported and organic constant currency basis. Our increased guidance is driven entirely by mortgage, specifically from better than anticipated price realization on 3rd party scores and credit reports. 2024, our mortgage inquiry assumption is unchanged at down 5%. Speaker 300:32:07However, we now expect our mortgage revenue to increase about 50%, up from 25% prior. We now expect inquiries to be slightly better in the first half of the year, but still down 10% and for the second half volumes to be flat. We expect our organic constant currency growth excluding mortgage to be up about 2% to 3.5%. We are pleased with our non mortgage outperformance in the Q1, but continue to take a deliberately conservative approach to the rest of the year given continued market uncertainty. For our business segments, we expect U. Speaker 300:32:50S. Markets to grow mid single digit or up low single digit excluding mortgage. Now anticipate Financial Services to be up low double digit or low single digit growth excluding mortgage. We continue to expect emerging verticals to be up low single digit and we expect consumer interactive to decline low single digit. We now anticipate that international will grow low double digit in constant currency terms driven by broad based positive trends and led by India. Speaker 300:33:29Turning back to the total company outlook, we expect adjusted EBITDA to be between 1.433 $1,475,000,000 up 7% to 10%. That would result in adjusted EBITDA margin being 35.6% to 36.1% or up 50 to 100 basis points. Anticipate adjusted diluted earnings per share to be 3.69 dollars to $3.86 up 10% to 15%. We expect our adjusted tax rate to be approximately 22.5%. Depreciation and amortization is expected to be approximately $530,000,000 and we expect the portion excluding step up amortization from our 2012 change in control and subsequent acquisitions to be about 2 $45,000,000 Anticipate net interest expense will be about $250,000,000 for the full year, up $5,000,000 from prior guidance due to higher sulfur. Speaker 300:34:34We expect capital expenditures to be about 9% of revenue. And as previously noted, we continue to expect to incur $200,000,000 in one time charges in 2024 related to our transformation program. I'll now turn the time back to Chris for some final comments. Speaker 200:34:54Thank you, Todd. And to wrap up the call this morning, we exceeded 1st quarter expectations driven by mortgage outperformance, international momentum, good growth from key emerging verticals like insurance and media and stable lending volumes in the U. S. Financial Services. We achieved key milestones against our transformation program, reinforcing our confidence in delivering against our financial commitment. Speaker 200:35:21And we're raising our 2024 guidance behind the strong first quarter results and better mortgage price realization. We remain focused and confident in delivering strong results in the current low growth market environment. Now let me turn it back to Greg. Speaker 100:35:38That concludes our prepared remarks. For the Q and A, we ask that you each ask only one question so that we can include more participants. Operator, we can begin the Q and Operator00:35:47A. Thank Today's first question comes from Andrew Steinerman with JPMorgan. Please go ahead. Speaker 400:36:16Hi, Chris. I was encouraged to hear that NuStar remains on track and that communications, marketing and risk all contributed. I was hoping you could just give us some more details on kind of the current trend in NuStar and aspirations there? Speaker 200:36:34Yes, sure. And good morning, Andrew. Yes, NuStar posted a solid Q1, very consistent with our full year guide and we had positive growth across each of the 3 principal product lines. Directionally, communication still is posting the highest growth rates and that's driven by our suite of trusted call solutions and new sales of that continue to be very strong. So that's encouraging. Speaker 200:37:05We also feel good about the rate of growth in marketing. This quarter was particularly strong in marketing and we called out the media vertical. That reflects some of the big sales that we had in the media vertical last year. We had a couple of clients in particular that consolidated their business on our audience platforms, which is encouraging. And in the Q1, we will start to lap those sales from last year in the Q2, right, but it was a standout in the first quarter. Speaker 200:37:41And then we've had some acceleration this year in the riskfraud portion of Neustar, particularly around our collections and communication solutions. So from a revenue perspective, was quite solid and we feel solid in the guide for the year. I think it's also important to note in terms of NuStar progress, we're still really confident on achieving the integration savings. We raised up to $80,000,000 We feel very good about that. And of course, we're striving to outperform that number and I'll keep you updated as the year progresses. Speaker 200:38:19Beyond that, there's a ton of technology benefit that we are taking advantage of currently. We've talked about OneTrue as our central data management platform and OneTrue began, of course, within Neustar as their next generation platform and we've extended it to meet the broader TransUnion enterprise needs. But in addition to OneTrue, over these past couple of years, we've done a ton of work to integrate our marketing and fraud solutions. And when you do this type of hardcore engineering integration, you move sideways from a product and innovation perspective for a period. But once you pulled everything together, you get a broader and more integrated solution, truly the best of both organizations. Speaker 200:39:05And we expect that work in marketing and fraud to be behind us as we enter in the second half and the third quarter of this year. So in my view, while we're posting good results in NuStar in a difficult environment, the best in terms of our product offering has yet to come and you're going to see that emerge later this year. Speaker 400:39:28Thank you, Chris. Operator00:39:31Thank you. The next question is from Faiza Alwy with Deutsche Bank. Please go ahead. Speaker 500:39:37Yes. Hi. Thank you. Good morning. I wanted to ask about mortgage since that's what's driving the guidance raise. Speaker 500:39:46I guess what was better than what you had anticipated in mortgage? I know you mentioned the pre call volumes and shopping behavior. But I guess what drove the pricing? And what gives you confidence that sort of this level of outperformance will continue through Speaker 600:40:06the course of the year? Yes. Speaker 200:40:08And thanks for the question, Faiza. It's a very essential to understanding both the quarter and the full year guide. As we were budgeting and forecasting 'twenty four, it was complicated because there are a lot of moving parts in the forecast given interest rates and market volume uncertainties, but also the new early assessment program by the GSEs, which was likely going to have an impact on mortgage prequalifications. Consistent with our overall conservative guidance posture, we were conservative on all of these dimensions of mortgage guide. Now what we saw in the Q1 is that volumes were a little better than expectations, but not hugely better and just absolute mortgage volume is a difficult thing to predict as we all know. Speaker 200:41:04But the assumptions we made about the proportion of pre qualifications that we would get and the 3rd party score price we would realize on those pre qualifications as well as the price realization of the credit portion, those all those assumptions turned out to be conservative, right. So in addition to that, we think and this is really our hypothesis is that now that mortgage lenders don't have to pull 3 credit reports and incur that cost of 3 reports and 3 scores at qualification, it's enabling some additional consumer shopping. So there may be some benefit coming from that as well because our qualification volumes were again beyond the conservative forecast that we put in place. So the combination of all of those things led to material outperformance in mortgage. We booked what we achieved in the Q1, and then we maintained or actually made a bit more conservative the volume expectations for the remainder of the year simply because it's a fluid market. Speaker 200:42:22There's a lot of uncertainty and there have been a lot of changes. Now, Todd, I think you can probably get into some more of the specifics here. I think that would be helpful. Absolutely. Speaker 300:42:33So Faiza, thanks for the question. And one point that I want to start with just to make certain that's clear to everyone is that TransUnion includes the prequalification volumes that Chris was just speaking about in our including the prequal. So what that means when Chris is talking about shopping activity being better, you have to keep that in mind that that's in essence one of the drivers that we saw to keep the expectations on volumes a little bit better from what we had guided. So from there, if you look at our guidance back in February, compared to what we've put out this morning, Starting with revenue, you'll notice that we've increased the revenue by 25%. So now we're expecting mortgage to grow 50% instead of 25%. Speaker 300:43:30But back to the volumes, we are expecting volumes for the full year to remain the same at down 5%. Now in the first half, we are expecting the volumes to be a little bit better. Back in February, we had assumed a 15% decline and now we are assuming a 10% decline. So in essence, you get a 5% pickup in the first half. Prequalification is a part of that. Speaker 300:43:59So keep that in mind. But then in the second half, if you go back to February, we were anticipating that we would grow 10% in our volumes. And that was just purely comparables. If you remember the second half of twenty twenty three was particularly weak. So what we've done is we've changed our second half assumption in essence to be flat. Speaker 300:44:20So what that means is second half now has a decline of 10%. So the reason that that's important to call out is we are fully acknowledging the headwinds that we are experiencing in the market from a volume perspective with the 10 year treasury yield creeping up and 30 year mortgage rates higher, we are acknowledging that in our forecast. So the takeaway here is that this is just better price realization on 3rd party scores as well as reports. Speaker 500:45:03Great. Thank you so much. Operator00:45:06Thank you. The next question comes from Jeff Meuler with Baird. Please go ahead. Speaker 700:45:12Yes. Thank you. Good morning. So Q2 guidance looks good. You just addressed mortgage, but maybe if you can more holistically kind of just address this concern that when rates moved higher kind of last summer, early fall, it created some incremental headwinds in various parts of your business. Speaker 700:45:32So just with rates moving higher recently, including again today, can you just talk about some other parts of the business where you saw headwinds last fall and maybe any sort of like changes in customer behavior or tone that you're hearing more recently on the back of a rate increase? Thanks. Speaker 300:45:53Hey, good morning, Jeff, and thank you for the question. So to start off in response to that, I think what's important for everyone to remember that our initial guide back in February did not anticipate a benefit from lower interest rates. So we went into the year, in essence, just very conservative. We didn't want to get ahead of ourselves and that proves to be a very good thing, right, as far as where interest rates appear to be headed. Trends in our core U. Speaker 300:46:27S. Financial Services business, I would say that they remain stable. You've heard from some of the bank earnings calls, they used the word subdued. I think that we have appropriately captured these trends in our outlook. There's no significant upside contemplated there. Speaker 300:46:48It's more of a continuation of the trends that we're seeing. Now some important reminders, TransUnion obviously has a very diversified portfolio. And as a reminder, in 20222023, we grew 3% in both years. Now clearly, that's not what we plan for and that's not at all what we aspire for, but it shows the balance of the business and that's intentional. So and with that also, we currently believe that interest rates perhaps may have peaked or maybe they won't go up much further. Speaker 300:47:30So what does that mean? Well, what it does is it drives certainty that didn't exist for our customers in the previous 2 years when interest rates were increasing in 2022 into 2023. Our customers didn't know how much higher that they were going to go. So there's definitely some certainty there. Also, it's important to call out that our international business just continues to have strong momentum. Speaker 300:48:01In our February guidance, we called for high single digit growth from that business. We've increased that even though we're maintaining in total at the company level, we've increased to low double digits for international just based on this strong momentum that we're seeing in international. Flip back to the U. S. Markets, the emerging verticals, it's important to call out there that many of those businesses are less dependent on interest rate movements. Speaker 300:48:30And this gets back to what I said at the beginning about the power of the diversified portfolio that we have. And I would say we're seeing improving trends there, nothing dramatic, but things are starting to get better. And then the last point I would make on this one is cutting across all of these businesses, TransUnion has a robust portfolio of solutions to help our customers, no matter what the macro environment presents them? Speaker 200:49:05Yes. Look, if I can reinforce a couple of points, the volumes that we experienced in the Q1, particularly in U. S. Financial Services are consistent with the Q4 of last year. The challenge is, as you know, Jeff, in September of Q3 of last year, the combination of increased rates and a real stress on bank deposits led to a material step down in origination volumes, right? Speaker 200:49:33Well, that appears to be flattening and therefore our growth is going to improve because we're not absorbing any material declines as we did in the second half of twenty twenty three. Thank you. Operator00:49:47Thank you. The next question is from Manav Patnaik with Barclays. Please go ahead. Speaker 800:49:52Thank you. 4 big categories in there, if you could just help us with how much they grew in 'twenty three and how we should think about what you've factored in for 'twenty four? Speaker 200:50:15Yes. Look, let me provide some quick color. And I don't Todd may recall the specific growth rates per emerging segment in 'twenty three, but I'm more 'twenty four focused. And look, overall, we're expecting higher growth from the emerging verticals in '24 than we experienced in 'twenty three. Starting with insurance, I think I said on an earlier call that we expected insurance to grow faster in 'twenty four, but not to return to the high single digit growth that we've enjoyed consistently. Speaker 200:50:52So it's a healing process in terms of insurers returning to former marketing levels. We've seen some improvement in marketing. Of course, we've also had some really nice wins, particularly in the driver risk. So insurance is solid. As we mentioned, we had a solid growth in media and that's because of the realization of some customer wins that we achieved last year. Speaker 200:51:16Public sector, our fraud products are helping us grow there. And finally, Manav, we're getting some nice growth in the collections area, right? As delinquencies rise, part of the compensation for our business model is increased collections and of course, Trusted Call Solutions is a growth driver across all of these segments. In technology and real estate, in e commerce, we're lapping some major project revenue. We're getting growth there, but it's more like the low mid single digit type of growth. Speaker 200:51:48And communications is always a blend. It's a combination of some heritage products that are either flat to declining slightly, but enhanced considerably by the Trusted Call Solutions Suite. And then we are still working our way through some difficult comps on tenant and employment screening. As you know, because of the consent order that we signed with the CFPB last year, we've had to take certain products, certain data that did not meet the enhanced requirements that the CFPB has imposed on the industry. We had to take those out of the market. Speaker 200:52:25We'll lap that comp by the second half of the year, but for right now, it's negative and a drag on emerging. So hopefully that helps Manav. Operator00:52:37Thank you. The next question comes from Kelsey Xu with Autonomous. Please go ahead. Speaker 600:52:43Hi, good morning. Thanks for taking my question. I was wondering if we can also talk a little bit about the growth we should expect for Sontiq and Argus in 2024 and how their margin profiles look like right now and kind of where you're targeting for 2024? Thank you. Speaker 200:53:05Yes. So let's see, SonTek and then Argus. Well, the quick news on Argus, I think is Argus has been completely integrated into the credit card and banking vertical within U. S. Markets. Speaker 200:53:24And we've spent a lot of time on the next generation platform, but also a lot of data hygiene and enhancement. So we've built a nice pipeline. We're getting some new sales and some conversions. And I continue to be very pleased that we've added this deeper, more authoritative view on how consumers are actually using their card through our overall foundation of credit information. Sontiq is growing very well. Speaker 200:53:58The key driver in Sontiq has been breach. As you know, in the Q4, we reported really strong growth in consumer, but it was almost entirely fueled by some breach revenues. So now that we've kind of matured our ability to sell this, I expect that we're going to continue to get good growth. But again, that is a more lumpy episodic type of product line, right. And so as we forecasted SonTek for the year, we forecasted very solid growth from Sontiq, but not an extrapolation from what we experienced in the Q4 and a bit in the Q1 of this year. Operator00:54:43Thank you. The next question is from Toni Kaplan with Morgan Stanley. Please go ahead. Speaker 900:54:49Thanks very much. I was hoping to ask about technology. You talked about the tech transformation, but just any update on AI and cloud, where you are today, any metrics we should be sort of looking at with regard to that and expense efficiencies and anything related? Thanks. Speaker 200:55:14Yes. So let me survey the landscape on technology because multiple efforts that really check the boxes that you've talked about have converged into our next generation foundational data management platform, which is 1 true. And think of that as all of the different data assets that we have, whether they be credit or marketing or fraud mitigation or public records are converging on a common set of functionality within OneTrue. Now part of that is data ingestion, identity resolution, basic analytics and certainly feeding all of that into the different product suites that we have, be it credit marketing, public records, fraud, etcetera, right? And I think we've provided some schematics, so you can better understand that. Speaker 200:56:12But underpinning 1 true, we're using machine learning, variance of artificial intelligence to speed the ingestion of data, the quality assurance, the governance, certainly the identity resolution. We're even launching a machine learning as a service in our enhanced analytics suite. So, One True now think of it as a comprehensive umbrella effort that's going to give us the type of one to many leverage from our technology that we've been steering toward. And of course, it's an entirely cloud architected, cloud native platform. All the data is stored within a fabric in the cloud or a common central repository, if you will. Speaker 200:57:00And it's also designed to be cloud agnostic because not all of our applications will go to the cloud. The majority of them will because the economics and the performance requirements make sense. But there are certain loads that we can handle more cost effectively in our internal private clouds, right. So as we've explained, there's a division there and we've talked about that previously. So hopefully that gives you some more flavor. Speaker 900:57:28Super, thanks. Operator00:57:31Thank you. The next question comes from Heather Balsky with Bank of America. Please go ahead. Speaker 1000:57:37Hi. Thanks for taking my question. I wanted to ask you about insurance and I know it's come up already on the call with regards to marketing. But I'm curious about kind of the other aspects of the business in terms of what you've been seeing in terms of insurers leaving state, what's going on with shopping. It seems like the data that you guys put out, it was pretty good for the quarter. Speaker 1000:58:02Just the broader environment for insurance and how you think about that for the rest of the year? Thanks. Speaker 200:58:09Yes, Heather. It's probably worth refreshing kind of the basic dynamics that we're seeing in the insurance space. And look, as we all know, the past couple of years have been very tough for insurers. There's been an increase in frequency and severity of events and the replacement costs have skyrocketed and it's led P and C carriers pulling back from higher risk regions, whether that's from wildfires or flooding or just a variety of natural disasters. And that's meant reduced underwriting volumes. Speaker 200:58:45And what is underwritten is that at materially higher prices often that has to be absorbed by consumers, and also a reduction of marketing until the insurers could get a number of rate increases through different states in order to turn profitable on kind of individual policy economics. There's been a lot of progress in getting insurance priced right for this more challenging environment. And so we are seeing an increase in marketing, but still, the space is not fully healed, if you will. And I think that's going to take more time, probably another year, but we do expect 2024 to be stronger on balance in insurance than 'twenty three was. You also mentioned shopping activity and you're right and this is probably something that we all have some personal experience with. Speaker 200:59:40Upon renewal, consumers get sticker shock. And against the price increases have been material for all the reasons that I talked about. And that does lead to some more shopping and shopping helps our business model. The other thing that's helping is a bit of an improved marketing environment and the continued growth of our driver's risk solutions as insurers are looking for ways to combat the increasing prices of state motor vehicle reports. Operator01:00:11That's really helpful. Thank you. Thank you. Today's last question comes from Ashish Sabadra with Deutsche Bank. Please go ahead. Speaker 1101:00:21Thanks for taking my question. I just thanks for providing those details around the India market. That's very encouraging. I just wanted to drill down on the international in general, very strong momentum in the Q1. The guidance also implies strong growth, but does moderate. Speaker 1101:00:37I was just wondering if you can talk about puts and takes and any kind of conservatism that's baked into the guidance? Thanks. Yes. Speaker 201:00:44Well, I would say our international forecast in total does reflect a similar prudent approach that we've tried to take across the enterprise. Obviously, we're really pleased with the Q1, but we were careful not to extrapolate from those results across the full year. Canada, in addition to India, is a real call out for many, many years now that team has executed well, has won a lot of customers, has further penetrated the entirety of the customer base with a range of solutions and has been posting outside growth. We're doing great in South Africa and across Africa broadly. And again, India is a huge standout and a privilege for TransUnion to be able to participate in. Speaker 201:01:37Asia Pacific has also had a great rebound. We're seeing exciting things in the Philippines. We're very bullish about the potential for developing our franchise there. And LatAm is doing well and we hope and expect to prove better results in Brazil. And look in the UK, the UK has been a tough slog. Speaker 201:01:58That economy has been through a lot. Inflation and interest rates have been very high. And we were probably overweighted there more toward short term money lenders and FinTech, which have had a particularly hard time these past couple of years. Now that that's kind of flattening out, the robust growth we've been enjoying in kind of core mainstream banking is going to start to shine through as well as some of the diversifications into the So Hopefully, I didn't leave anybody out as I went around the horn here. Apologies, no offense intended if I have. Speaker 201:02:37But look, international is rolling well and we expect to continue to post really good results this year. Great. Speaker 301:02:47That brings us to the end of today's call. Thank you for Speaker 101:02:51your time today and have a Speaker 301:02:52great rest of the day. Thanks. Operator01:02:56The conference has now concluded. 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