Navan (NAVN) Q2 2027 earnings call transcript

Thanks, Lisa. Good afternoon, everyone, and welcome to Navan's second quarter fiscal 2027 earnings conference call. With me on the call today are Ariel Cohen, our chief executive officer and co-founder, Aurelian Nolfe, our CFO, and Michael Sinedich, our president. As a reminder, we publish detailed prepared remarks on our IR website. During the course of today's call, we may make forward-looking statements with the meaning of federal security laws. These forward-looking statements are subject to risk and uncertainty that could cause actual results to defer materially, including the risk and uncertainty described in our earnings press release, our annual report on Form 10-K with the SEC on April 2, 2026, and our other filings within the SEC. In addition, on today's call, we refer to non-GAAP growth margin, non-GAAP operating margin, non-GAAP income and loss from operations, free cash flow, which are non-GAAP financial measures that provide useful information for investors.

Reconciliations of these non-GAAP financial measures to their corresponding GAAP financial measures to the extent reasonably available can be found on our earnings press release. And with that, it's my pleasure to turn the call over to Navan's CEO and co-founder, Ariel Cohen.

Thank you, Irene, and thank you, everyone, for joining us. I hope you had the chance to review our prepared remarks. In this quarter, you can have only one conclusion about us. We are winning. You can see it with the following. The current usage of the platform and its growth are new sales and growth of our end-to-end AI platform from business travel, payments and expense, VIP travel, and now meeting and events, and our AI platform leadership. We are simply executing across the board while gaining momentum.

Let's talk about the current usage of the platform. This quarter, total GBV, this is travel bookings on the platform, grew by 45% year over year to more than $3 billion. We exceeded our expectations for both revenue and non-GAAP operating income, and we are raising our full-year FY25 and outlook again. Customer satisfaction remains high, which is set of 96 and NPAs of 44. Our platform is gaining usage across the board on every use case in every geo. Let's talk about sales and new customers and us taking share. So we are seeing strong sales execution across SLG. SLG is our sales-led growth, which is basically enterprise sales, and PLG, which is our product-led growth, which is our sales cycle.

Our enterprise sales motion delivered another strong quarter, with SLG having their strongest sales quarter ever. New signed GBV for SLG was $4 billion in the last 12 months, and that was up 60% compared to Q2 last year. However, product-led growth revenue more than doubled year over year again and comes as an addition to our new sales in SLG. Payment volumes reached $1.3 billion and grew 34%, and subscription revenue was $21 million, with a growth of 39%. To be clear, our growth is not coming from one isolated part of the company. The entire system is working together. Sales, product, deployments, operations, customer success, and our global travel and fintech infrastructure. At the same time, our own execution is creating more opportunity.

The volume of RFPs to Navan has tripled in the first half of the year compared to the first half of last year. We now serve 50 companies in the S&P 500, up from 45 last quarter. We are winning larger and more complex enterprise customers across the globe. The most important thing is that our investment in our sales and marketing is becoming more and more efficient with the help of AI in this huge market.

AI obviously is an important part of our strategy, so let me cover that. As I've explained in our last call, before we even get to AI, it is important to understand the foundation we have built. Navan is connected to virtually every airline, hotel, rail provider, and ground transportation solution that our global customers need. Business travel and fintech connectivity are extremely complex, and we have spent the last 11 years bringing that complexity together on a single, real-time, global platform. This is not just about booking a trip. It's about managing the entire journey, finding the right inventory, booking it, paying for it through a physical or a virtual Navan card, supporting the traveler, changing the itinerary when needed, and ensuring the proper credit, refund, reconciliation are handled automatically.

To do that at a global scale, you need supplier relationship and negotiated rates, banking partnerships and credit lines, local entities and licenses, compliance with local law and taxes, payments infrastructure, and operational expertise in markets around the world. We have built all of this into Navan's real-time infrastructure. That foundation is extremely difficult to replicate, and it is what we believe allows us to turn our AI platform to a scalable solution, supporting big enterprises across the globe. We are not treating AI as a feature layered onto traditional travel products. We are rebuilding the travel and expense experience around intelligence, orchestration, and action. Navan cognition is the intelligence layer that orchestrates specialized AI agents, human experts, data, live inventory, policy, payments, and fulfillment.

The important distinction is that Navan does not just provide an answer. It can understand intent, take action, complete a transaction, manage the trip, reconcile the expense, and bring in a human expert with the full content when judgment is required. Ava is our AI customer support agent who is already demonstrating the value of this architecture. In Q2, Ava handled approximately 60% of customer interaction, and our customers love it. To be clear, Ava is not doing simple things like resetting your password. She's rebooking your trip when you are stranded in an airport, changing your hotel when you are not happy, taking care of your refunds, and many more complex business travel support tasks. The perfect orchestration between human and AI agents improves the traveler and our corporate customers' experience by supporting them more accurately and faster.

Since servicing business travel and payments requires massive travel agency and operation support, it is very hard to scale fast. By utilizing our AI platform, we are able to support Navan uses growth without jeopardizing the quality of our service. This is one of the reasons that we are so confident to raise our guidance for the second time this year to 32% year over year. We are also taking increasing control of our technology stack. Approximately 50% of our AVA AI model calls now run on Navan-owned models up from 30% in Q1. These models are purpose-built for travel and expense and trend on our own data. Over time, we believe that it should give us greater accuracy, faster response time, and lower cost.

So AI is not just a product investment. We believe it is also an opportunity for a structural gross margins expansion and greater operating leverage. By bringing Navan capabilities directly where travel intent begins, Navan MCP extends our Navan Anywhere strategy. It provides conversational access to data across travel, expense, booking, and policy in Chatship ET, Cloud, Courser, and separately, we are adding agent capabilities in key collaboration tools like Gemini's and Slack.

Navan Edge is our flagship AI product. Edge is a full travel assistant who deeply understands you like a real person. It not only plans your trip, but also books everything from flights, hotels, restaurants, and events, and make the changes when needed. Simply, it's the best travel agent in the world.

To summarize our AI platform, travel and fintech infrastructure are the key. Ava, Navan Anywhere, and Edge are creating the application layer value, and using our own model gives us unique value proposition based on our own data. These three components allow us to grow our revenue faster with better economics while creating massive value for our customers. The last thing that I wanted to talk about is M&A and the expansion of our platform. As we have explained in the past, business travel has endless needs, and our goal is to bring every need into our AI platform. Travel is still an entry point, but is increasingly connected to payments, expense, meeting and events, VIP travel, and be leisure.

Each of these additional products allows us to manage more of the customer's spend, replace more fragmented workflows, and become more strategic inside the enterprise. That is flywheel we are building. Better inventory and connectivity drive better experiences, better experiences drive adoption, and broader adoption creates more opportunities across the platform. This is why we build new products and make acquisitions, and why I'm so excited about our acquisition of BoomPop. This expands our capabilities in meeting an event, an enormous category that remains largely unmanaged and messy. Together with BoomPOP, we expect these opportunities to make Navan more valuable to our existing customers and expand the universe of customers we can serve. BoomPOP is already a partner. Our joint AI platforms allow us to plan events using conversational AI in an efficient way that was never seen before.

I'm super excited to welcome the BoomPop team to the Navan family. So stepping back, this quarter gives us an evidence across every layer of our cases. We are growing in a resilient market. We are winning larger customers and taking share. SLG, PLG are scaling. Customers love the product. AI is improving the experience, increasing efficiency, and creating a margin advantage. And we are raising our full year outlook because our execution is strong, our visibility is improving, and the opportunity ahead is large. I want to close this by thanking the Navan team, our customers and investors. The team is firing on all cylinders, and we are having a great time while winning. We are still in the early innings of a large opportunity, and we are building the best travel agency on the planet for the agentic era.

And we are only just getting started. And with that, I'll turn it over to Orlean.

Many thanks, Arya. It's great to be here, and thanks all for joining us today. What continues to impress me is how consistently the team is executing across the business, and Q2 was another strong example of that. I will just cover the broad momentum, so let me focus on the financial takeaways, which is growth and operating leverage are advancing together. Revenue was $233 million, up 35% year-over-year, and GBD reached just over $3 billion, up 45% year-over-year. Once again, we exceeded our expectations for both revenue and non-GAAP operating income. This outperformance was driven primarily by strong volume demand and bookings on the platform, with healthy expansion from existing customers, continued growth from ramping customers, and faster contribution from new launches.

We also benefited from a higher premium cabin mix. Our visibility into future growth continues to improve. Over the last 12 months, we signed $4 billion of new GBV in our SLG business, a leading indicator of future revenue growth. While ramp-up timing varies by customer, meaning it does not translate to a specific growth rate for GBV in any specific period of time, we believe these metrics reinforces our expanding footprint in the sector, driven by our accelerating go-to-market momentum. We are also seeing continued leverage in the platform. Non-GAAP growth margin was 75%, and non-GAAP operating margin was 7%, up from 5% a year ago. Revenue continued to grow faster than our cost pays, even as we invested in AI infrastructure and product innovation.

The primary driver of that is AVA, higher resolution rate, which is further supported by the increasing use of our own models that are helping us scale more efficiently, and we expect further leverage over time. Pre-cash flow was $28 million on a 12-month basis compared with a burn of $33 million a year ago. We ended the quarter with $820 million in cash and short-term investments and approximately $125 million of debt.

That gives us substantial flexibility to invest in the business and pursue strategic opportunities, but we will continue to deploy capital with discipline. Now turning to the outlook For Q3 we expect revenue of to million representing 30 growth at the midpoint and non operating income of to million representing 14 margin Now for the full year and considering the sustained momentum in the business and healthy demand for business travel we are again raising revenue guidance now to to million or 32 growth at the midpoint We are also raising non-GAAP operating income guidance to $82 to $86 million, or a 9% margin. So now, stepping back, we believe Q2 reinforces this financial story, strong and broad-based growth, continued operating leverage, and disciplined investment.

We are entering the second half with a very strong momentum, a very good visibility, and a very strong balance sheet. We will remain focused on converting that opportunity into durable growth and cash generation over time. I'm very, very thankful for all the great and hard work happening across the company. And as Ariel mentioned, we are having a great time here furthering our mission of building the best travel agency on the planet. And with that, operator, we are ready for questions.

Michael Sinisich, Ph. D. : Yeah, great question. This is Michael Sinisich here. Good to hear from you again. So I think in general, first of all, we're absolutely pumped and I'm so, so proud of the go-to-market team and everyone at Navan who's building the products and services that we're delivering. To your point, there's a lot of tailwinds that we're seeing. It's RFP volume increasing. It's industry stuff. It's the products that we deliver that drive 15% savings on average and you can book within seven minutes. And everyone is super hyper focused on employee efficiency, especially from the people that are generating revenues for their company, which happen to be a lot of travelers. So I think with all of these tailwinds, all of the increases in the RFPs, which just gives us more at bats, I think it's really just simply like signaling to us that we're watching disruption happen in front of our eyes.

We get a lot more at-bats, and we get a lot more opportunities, to your point. And what we've talked about in the past is we actually see win rates increasing, we see ASPs, or average pricing, also increasing, and we see the productivity per rep also increasing. So with those three things happening, that then translates to faster growth, which we show with bookings and revenue volume. And for the first time, we're super happy to report on the new sales, which was $4 billion of travel volume coming from the SLG team. And so what that means is we then sell a deal. And then we've talked about this before, where it takes about two months on average to implement the customer.

So what happens then is we connect to the HR system, you know, your SSO, the expense solution, payments, and then we set up the policy and we launch to the company. Once we launch to the company, then it's about a five-month on average ramp until the account gets to full ramp and full adoption. And that could mean, you know, deploying country by country. It could be big bang launches. But on average, it's about a two-month implementation and a five-month ramp up of the customer. And so that kind of gives you an hint and an idea of kind of what it takes to close the deal all the way to ramp. And if you think about it, the companies that are doing RFPs are generally enterprise-type companies, so larger.

And those deal cycles can be a little bit longer as well. So we get an RFP, it might be six to nine months before we have a signed contract and then go and begin the implementation.

It's consistent, again, with what we talked about, you know, a couple quarters ago, but we were in an environment where we are relatively capital constrained, and so what that meant is we weren't as focused on selling the payments volume, which often actually comes with the expense ACV product as well. And so what we've done throughout the IPO is we've restructured our capital structure, we have brought on warehouses, we have the capacity, and now the sales team is going out there and really selling our payments and expense products, which you can see just how fast that acceleration has occurred just in a few quarters. And we're really excited to get these products out there because customers absolutely love it.

And ultimately, what it does is it drives automated expense management and the finance teams don't have to spend a lot of time reconciling their travel bookings. But I don't know, Aurelien, if you have anything to add?

Yeah, I'm super excited to see the acceleration here, right, in terms of the growth of the payment volume is coming across the board. So we have more new customers signing up for payment and expense. We are seeing more upsells. And then we are seeing the existing base adopting our solution even more. And so that's why you're seeing this growth in terms of payment volume, an acceleration to 34%. That's 29% last quarter. And we're very excited about this product, as Michael mentioned.

Yeah, amazing question. Thank you, Pat. So here's the thing. I always thought about Navan, and we first land a customer and a business traveler, right? So we tell them there is a new way to think about stuff. It is way more automated. AI is part of it. It's easy to book. You know, on the Navan platform, it takes seven minutes to book. When you want to change something, it's super fast. So really, really surrounding you, the traveler, around this goodness. But we also know that business travel has many more needs. You know, we've talked about payments and expense. In the past, we talked about VIP. How can we take the VIP experience and bring it and make it an AI experience?

Meeting an event is a big part. It's actually 30% of the time of this market. It's a big time of the need, of the need of the company, of the need of the traveler. And when we looked into this years ago, when we came to the market, we saw that it is so antiquated. You are basically having an RFP pair event. You are sending an EA to sort some hotels and restaurants and other things. It's really, really old school. It takes a lot of time. It's extremely not transparent. You are signing with somebody a deal. They go and kind of negotiate with three hotels for you, and then they tell you, this is the hotel that you're going to use.

Takes a lot of time, antiquated, the opposite of what Navan is all about. So we thought if we can bring that experience to become online, to become conversational, hey, I want to have an event for my sales team. I'm thinking about Vegas or New York, and this is my budget, And this is what I need, and I'm talking with you or with the platform. And then the platform is actually automatically going and talking with the various providers. And we are creating this match. It will make the experience completely different. People will like it. And then we as Navan, we're going to create more value to our customers. We are basically becoming more and more their one-stop shop for every need around business travel.

So that's why we are excited about it. And BoomPok specifically, we know these guys for quite some time. They are the guys. They really, really innovated in this space. They proved that you can take something that is extremely manual and make it AI. AI, which by the way, two years ago when I first met them, I actually didn't believe them. And I went very, very deep and understand that it's really AI and not some story as a lot of people are telling. And it's just amazing. We partnered with them. We are seeing happy customers together, and we decided to make them part of Navan.

I'm going to add to your point about how prevalent it is. People are saying that it's roughly 30% of all business travel volume is actually coming from meetings and events, so the opportunity is obviously huge.

Yeah, so I'll answer the first question about the pipeline. The RFP kind of thing that Aurel mentioned is the leading indicator, right? So generally, larger companies are more prone to launch requests for a proposal. And so, obviously, there's quite a lot of people that are interested in looking at Navan, and I think the choices are relatively limited. It's essentially antiquated version, or it's the modern AI-based travel and expense platform, which is Navan. And so, that kind of gives you an idea of the pipeline. When it comes to the specific bookings and enterprise or anything like that, we actually don't separate the two or we haven't announced kind of the difference between them.

But in general, I'll let Arillian talk about how bookings are trending. Yeah, very, very healthy demand across the board, inclusive of the enterprise segment, obviously. Like, we see companies keep leaning into, you know, business travel to generate revenue, right? Like, when you think about the reason why people in the first place are using our platform, it's because, you know, they need to meet the prospect, they need to meet customers, they need their teams to get together. And we keep seeing more travelers traveling more, and the average booking going up. So we see a very, very healthy level of demand across the board.

Great question. So, you know, you may remember when we discussed about Q1, we obviously mentioned that we saw in the back half of the first quarter some more inflation than at the beginning of the quarter, obviously due to the disruptions that are happening in the world. And our assumption for the Q2 guidance was that the exit level is what we would see throughout the second quarter, and that's exactly what happened. So from that standpoint, I think steady inflation is what we've seen throughout Q2, and this is also what we are assuming for the rest of the year. You know, it's obviously very hard to sit here today and predict inflation, but based on everything we are hearing, all the commentaries across the industry, what we are seeing today, we believe it's a reasonable assumption.

So that's how we are thinking about our guidance. What I would add to that is, obviously, we are not providing a booking guidance. We are guiding to our revenue number. And as a reminder, most of the inflation is impacting flights as opposed to hotels. And the way we monetize flights versus hotels is such as the impact of inflation on revenue is way less than the impact on bookings. So I just wanted to also reiterate that.

Yeah I don I won know all the specifics of each type of savings there but I can talk generally about it So what Boompop does is first of all it as Ariel mentioned it fully AI conversational based And what they do is you can explain what you want to do And then they will actually go out and source various hotels they will source catering they source photographers if you want to buy swag they create a website for you they manage your attendees It's a very, very robust program that kind of puts together in one solution this like spaghetti type of operation of doing an event.

And then what happens is BoomPop has really deep relationships with suppliers. And what they do is they can bring them volume and you can get better rates than what you would see just on the normal hotel's website. And so, you know, again, not knowing exactly each specific of how it adds up, but the bulk of the savings is going to come from the discounts, from the list pricing if you were to go and do it yourself and just sign up with a hotel and book those rooms because they're able to pass on the negotiated rates that they can get to the customer. Does that make sense?

So we are usually not breaking down yield by, you know, line of business or different components of the business. But what I can tell you is, it's, you know, roughly steady and very consistent with what we are seeing. But what's really more important than that is, you know, combining the two companies gives us a huge opportunity. Like, we have a great portfolio of customers that are all organizing meeting and events, and most of them are doing that offline. And combining forces with the BoomPop team and their cutting-edge technology gives us the ability to upsell and really attach meeting and events, this business, to more and more of our customers. So when I think about the value we are providing here, it's, as Ariel mentioned, is going deeper in our relationship with our customers through that new business of meeting and events, which we were already, you know, doing as a company, but we are now bringing it online with BoomPop.

One thing that we launched is the engine partnership as well, which is huge for us to add more content and more availability and better types of booking for different industries. But on top of that, to your point, one of the things that we did is launch a direct connection to Hilton. And what we're doing by connecting directly to suppliers is it allows them for more flexibility, more accurate retailing, better upselling of ancillaries that are relevant to travelers. And it allows us to service these types of bookings really quickly, apply unused credits automatically, and just manage, cancel, change these types of bookings. So for us, it's not a play about, you know, driving a different yield or a different revenue from these types of things.

It's about giving the right content, the best content, the best pricing to our travelers on the platform.

So, you know, trying to understand, you know, the moving pieces in that and maybe, you know, higher thinking about those incremental investments and what you're assuming in the guide for the rest of the year as well.

Yeah, of course. Maybe I can unpack that a little bit. So, first of all, as you mentioned, very strong revenue beat and driven by a lot of bookings, great sustained momentum and demand. And so, yeah, great beat on revenue. Our gross profit was more than 75% for the first time in the company history. So, you know, we keep seeing a lot of tailwinds here coming from the rate of resolution that Ava is handling at 60% of our Q2. And that makes us way more effective from a cost perspective on top of obviously providing a better service for travelers, but obviously very, very good from a gross margin perspective. And then because we've been so successful in our go-to-market initiatives and, you know, with more than $4 billion new signed GBV for SLG, we're just paying more commissions, right?

And again, very, very happy about the payback here and what we are seeing. We have a very, very strong and efficient go-to-market team. And so that led us to also beat our bottom line expectations as well.

Okay, perfect.

Thanks for taking my question. Just looking at the base of your growth margin expansion in 2Q, sort of moderated from what we were seeing the last couple of quarters, is there anything in there to call out, or is it just Tupper Cops? Yeah, I mean, we expanded gross margin 200 basis points in the year-over-year in Q2. And as a reminder, we expanded gross margin by 1,000 basis points over the last couple of years. So, I mean, we keep making a lot of progress there. And, you know, we are launching more customers and be very, very thoughtful about deploying, you know, human agents orchestrated with our AI agents. And we're very pleased. I'm very excited to see the rate of resolution from Ava going to 60%.

And the team has a lot of ambition here to keep driving that mix at an even higher point, specifically as we use more and more of our own models that are more accurate, give better results and faster results. And so as we keep making progress here, we're going to keep AVA handling more and more of our support function, and margins are going to keep expanding. But I'm very excited about the pace of the expansion because what's the secret sauce of Navan and the reason why our customers love us is we are not optimizing for gross margin. We are optimizing for NPS and CSAT. And as a result of that, we are seeing a gross margin expansion.

But first and foremost, the reason why we are successful is because we are the best travel agency on the planet. And that's what comes across when you look at our satisfaction scores.

Yeah, that's a really good question. I think we really, when we think about what we call internally content, it's all about all of these advantages that I was talking about when it comes to AI. So there are so many ways to connect to suppliers, to airlines, hotels, and others. You can use a lot of aggregators, but that means that you are not always assuring the right price for the customer. But also from a merchandising perspective, you don't have the right information. So it could be the pictures of the room. It could be the size of it, the description.

Same goes, by the way, to airlines. So when you go to the Navan platform, no matter if we show it in the UI or in a conversation in a platform like Navan Edge, it's all about really, really, really knowing what's out there, what you, the user, want, and create the match between that. So if any of the people on this call have used Navan Edge, obviously it's a new product, you can see that I can actually tell Navan Edge what kind of hotel, what kind of room I will want to have in my next day in New York. And it will tell me, you know, because you like the bar and you like the gym, we suggest that you will be in this hotel.

But I didn't even ask about the gym or the bar, right? Or I didn't look for the logo of the gym and the bar. So Navan Edge really knows me. That's really important. But it really, it is thirsty for content. It really needs all of this information, like you think about merchandising. So by connecting directly to suppliers, by going to aggregators, by taking all of this data, which is, by the way, Navan data now, we can actually create an amazing experience, which, by the way, creates more revenue because you are more likely to book in the Navan platform. You are less likely to go and look for it outside because we are just giving you the better information.

So this is really what lays behind the NDC strategy. Although sometimes benefits of yield to us or benefits of pricing to the customer, the answer is yes, but that's not what drives this strategy. What drives this strategy is data and the data that we're presenting to our customers.

Yeah, I – this is Aurélien. So we – you're seeing our marketing and sales investment, which is mostly sales investment. I will now turn the call over to management for the Navan, Inc. I will now turn the call over to management for the Navan. Marketing and sales engine for the balance of the year. And then, you know, beyond that, if we step back from our P&L, the opportunity is massive, right? And so when the management team has conversations about where do we want to invest, where is the opportunity, it's very, very clear to us that the size of the corporate travel market is so significant. And we are such at the beginning of the penetration of that market.

We're very proud of serving 50 companies out of the S&P 500, but that means many of them are up for grabs. And that's the opportunity, and that's why we keep investing in our marketing and sales engine going forward.

So, any kind of incremental color in terms of the impact of the guidance update would be helpful. Yeah, so absolutely not those levels of revenue impact. So for fiscal 27, smart trips is top and bottom line, very immaterial. So if it's in your model, you're doing it wrong. So it's small, very strategic, and we're very excited about it because of the access this is giving us to a lot of local inventory. I had our licenses and a great team, but immaterial impact to our financial statements in the short term. And then from a boom-pop perspective, low single-digit, very low single-digit impact to revenue in fiscal 27, so far away from the number you just quoted, and a mid-single-digit impact to the non-GAAP operating income as we are integrating the team.

We expect that business to become accredited in fiscal 28 though But fiscal 27 the summary is immaterial impact to top and bottom line Got it.

And then secondly, just in terms of new customer adoption of the Navan MCP and Navan Edge, maybe just any other color around what you're seeing there in terms of the profile of customers that are utilizing these new capabilities. Sure. So, first of all, regarding Read and Mackay, we really need to understand that there are two aspects. One is really us providing VIP service on platform for most of the Navan customers, and there it's actually fully integrated, and people are super happy. As you know, we are always measuring CSAT and NPS. Then the written Mekhi customers, which are fairly traditional, used to mainly talk with agents, calling, selling emails, we have this idea, which I've talked about in the past, to bring them on platform.

And then it's a program that will take several years, and right now we are very happy with what we see. We see more and more customers of that nature actually going to this platform, and by that, really enjoying this orchestration that I'm talking about, AI agents, and actually VIP agents in this case, together providing them service. And the reason that we know that they are happy when they are doing this transition, their NPS and SISA tends to be really high. So that's what we see, and that's why we are continuing with this program. So this is really how I'm looking at this program and asking myself, is that successful or not? Are we seeing satisfaction by these very, I would say, traditional customers that want this type of service?

So that's that part. Regarding the question of edge, first of all, I would say maybe the bottom line here, Edge is the fastest-growing product that we've ever launched in Navan. So that's really, really important. It actually tells us that this idea that people will want to have a conversation, basically with AI, and booking their entire trip, but also having restaurants, events as part of the trip, doing all of these things automatically. Basically, while we know them very, very well, that idea resonates with a new type of customer for Navan. This is not a corporate customer that we signed with. This is actually an individual who is a business traveler that is coming to our platform and starting to book a trip.

And what I'm looking at is, first of all, are we growing? And as I said, we are growing really fast. Second, I'm asking myself, is NPS is high? The CISAT is high. NPS there is actually very high, significantly higher than what we see in the Navan platform. Then I'm asking myself, do I see repeating usage? Remember, this is not a company that the CFO told them you have to use Navan. This is an individual that decided to come to our platform and book. So do I see that individual coming again for their next trip and their next trip? And the number there is actually amazing. It's way more than what I was expecting, and it's actually the trend is going up.

So all of the numbers, trend is very, very positive. We are very happy with what we see there, and I'm actually very optimistic as this starts to get scaled to start to see impact next year on our numbers.

Most of my questions are asked, just wanted to ask them the competitive landscape. There are some kind of consolidation we saw in that legacy vendors. I'm wondering how is the pipeline and win rate trending and how you're trying to capture that market? In general, we see the consolidation as a big tailwind for us. I think, you know, hopefully, customers are seeing that we're causing quite a lot of disruption because we're completely changing the way that it means to manage corporate travel in the world of technology and AI. And so because of that, a leading indicator is what Ariel talked about earlier, where RFP volume has tripled since H1 of last year versus H1 of this year.

And so usually those RFPs are coming from more enterprise customers, and you can assume the enterprise customers are coming from more of the legacy travel management companies that are doing some of the consolidation. So hopefully that gives you a clear view of kind of what we're experiencing internally. Great. Thank you. So, historically, across product attached, retention.

Can you hear me now? Oh, yeah, it's better. Thank you. All right. I'll just repeat. So, I was asking on your larger global enterprise wins, and how do the long-term economics compare with some of the smaller customers you've had previously, How should we think about long-term trends?

Yeah, yeah. So first of all, before I compare the different cohorts or segments, I just want to reiterate that it's been very steady, right? Like, we are not seeing any shift when we look at segment by segment, not seeing any shifts from, you know, pricing or yield or the way we work with different companies. What we've been discussing in the past is, generally speaking, enterprise customers have a very different profile than, you know, mean market or smaller entities. At the end of the day, the gross margins look very, very similar, but the way we construct those gross margins is a little bit different.

So enterprise customers frequently have direct negotiation rate with airlines or hotel chains. And so on those bookings that we facilitate on our platform, we charge more trip fees as opposed to getting some commission from our suppliers. And the opposite would be true when you go down in the market. But every customer is made different. One of the reasons why we love all of them and all those segments with their different characteristics is they also come with different tailwinds that they provide to the platform. So enterprise customers are coming with very significant volumes. They are very sticky customers, and they offer a lot of opportunities for us to upsell and attach more of the expense and payment, now the M&E business as well, and provide a lot of opportunities for our sales team to just go and upsell and grow the relationship with them.

And so, again, different characteristics, overall similar gross margins, but being constructed in a different way.

Congratulations on the acquisition of BoomPop. What's the opportunity for more puck-in deals like this, and are there any areas where you think you could benefit from M&A? Yeah, I mean, it's obviously, I don't have any, you know, specific target or acquisition in mind today that I want to talk about. But, you know, we are always looking for opportunities to, you know, expand like we just did to a new product that helps us upsell and attach more product to our existing relationship. So that's what you saw with BoomPop. SmartTrips was clearly us trying to increase, expand our footprint globally. And so we could see more of that in the future. But I want to say the bar for M&A is very high.

We really look at companies that can bring things that we don't have internally or that we think would take a long time for us to build by ourselves. But it's not a goal. It's just a tool for us to accelerate our vision.

Great, great. So thank you all. So just as last quarter, we have been asking our individual investors to submit some questions on our platform. And so I think, Erin, you want to share the top, voted questions with us.

Yeah, thanks, Aurelien. I've got three.

The first question, I think it's for Ariel. This is for Patrick P. He asks, the company is mostly for business use. Will there be available for individuals in the near future? Yes, so first of all, the first user that is now coming to the platform as its own decision is actually people that are coming to the Navan edge. These are employees that are working for companies. They either don't have a managed solution in the organization that they work for, or they are not happy with that solution, and because of it, they are coming to the Navan edge. So in a way, while they are business travelers, they have a behavior of a consumer. They are deciding to book their business trip in a Navan.

Now, across the platform, while you are using us, you can also use us for your personal needs. We internally call it Belisier, which means that let's say that I'm flying to New York, but I'm also spending the weekend there. I can actually combine the usage of my business need with my personal need. There is an entire functionality there that allows you to split the cost, to really kind of have the personal trip isolated from the company reporting, and so on. So these two aspects today in the Navan platform are very consumery. One is actually I'm deciding to use Navan Edge, and the other one I'm expanding my business trip to a personal trip, and people like to use these two products.

Great.

Thanks so much.

The next question, I think, is for Arillion. If business slows down, what are your cost-cutting strategies? Yeah, so first of all, so far, so very good, right? I think we've been discussing this on this call. The demand for business travel is very, very strong right now. So obviously not something I'm focused on at the moment, because we are very excited about the volume of bookings on the platform. So, you know, I think in that scenario, the process will be the exact same than we have today, which is really focused on the return of investment and being very intentional.

You know, today we are clearly going on the offense because we see great payback every time we invest, being R&D, you know, M&A, marketing and sales. We see a very, very good payback, and I think if that were to be the case, the process would be, again, exactly the same.

Okay, that's really helpful. Thank you.

And our last question, Michael, this one's for you. This is from John Z. , Navan Rewards Program. How has Navan incentivized to earn rewards users at personal stage off of business? Why do they expire?

Yeah, great question. So just to set some context so everyone here knows, Navan actually pays travelers when they choose more cost-effective options on behalf of their company for business travel. So it's a really unique way to help drive that 15% savings that we bring to our customers. And to the question, so some airlines, hotel programs, et cetera, the points will expire. Some of them don't. A lot of points programs generally are rather opaque, and the Navan platform is giving dollar for dollar. So when we give you a dollar reward, you can use it. Its value is worth a dollar for a personal travel booking. And essentially, our travelers on our platform are able to triple dip.

So when they make a booking, they can use their credit card and get credit card points. They can book suppliers that will give you those specific airlines and those hotel points. And then on top of that are the Navan rewards that we pay for. And so because of that, it's the kind of program that actually expires those rewards after 12 months. So our message is just make sure you hurry up and use them if you've saved your company money to go on a personal vacation.

Great. Thank you.