Financial Data and Key Metrics - Q2 bookings grew 5% YoY, reaching 964million,thehighestgrowthratesincetheAvastacquisition[6][14]−RevenueforQ2was974 million, up 3% YoY, with Cyber Safety revenue growing 4% YoY [16] - Operating income increased 4% YoY to 567million,withanoperatingmarginof58.2336 million, and diluted EPS grew 16% YoY to 0.54[24]−Directpayingcustomersincreasedby400,000inQ2,reachingarecord39.7million[6][17]BusinessLinePerformance−CyberSafetybookingsgrew5860 million, supported by improvements in customer acquisition, ARPU, and retention [17] - Partner revenue grew 7% YoY to 102million,drivenbyidentityandprivacyofferings[20]MarketPerformance−Internationalandmobileexpansioneffortscontributedsignificantlytonetnewcustomergrowth,with389,000newcustomersaddedsequentially[18]−TheUSmarketsawincreaseddemandforidentityprotectionfollowingtheNationalPublicDataBreach,whichexposed270millionsocialsecuritynumbers[7][15]StrategicDirectionandIndustryCompetition−Thecompanyisfocusedoninnovation,particularlyinAI,withtheGenieanti−scamproductachievingover1.6milliondownloadsandnearing1003.905-3.930billion,reflectingconfidenceincontinuedgrowthandexecution[27]OtherImportantInformation−ThecompanyendedQ2with737 million in cash and 2.2billionintotalliquidity,includinga1.5 billion revolver [25] - Share repurchases and debt paydown remain key components of the capital allocation strategy, with 1.6billiondeployedinsharerepurchasessincefiscalyear2023[26]−Thecompanypaidaquarterlydividendof0.125 per share, with the next payment scheduled for December 11, 2024 [26] Q&A Session Summary Question: Impact of the National Public Data Breach on net adds - The breach significantly increased consumer awareness, driving higher demand for identity protection, particularly in the US [30][31] - The company saw broad-based growth across all brands and regions, with a notable increase in identity protection sales [31] Question: LifeLock attach rate and cross-sell performance - Cross-sell penetration continued to grow, contributing to bookings growth and ARPU improvements [32] - LifeLock attach rates increased, with more customers upgrading to higher-tier memberships, driven by the NPD breach [32] Question: Balance between buybacks and debt paydown - The company plans to maintain a balanced approach to capital allocation, considering macroeconomic conditions and cash flow generation [36] Question: First-year retention trends - First-year retention rates have improved, driven by innovative product offerings and competitive pricing [37] Question: Genie AI integration and monetization - Genie AI will be integrated into Norton 360, with plans to expand features and monetize through upgrades and cross-sells [41] Question: Employee benefits channel performance - The employee benefits channel grew double-digit, with a strong pipeline and increased adoption of identity protection services [43] Question: Direct customer net adds breakdown - International and mobile expansion were the primary drivers of net adds, with additional growth from identity protection sales [47] Question: Advertising costs and gross margin trends - Advertising costs have been stable to slightly up, with higher CACs for high-value customers like LifeLock [52] Question: Bookings growth and revenue outlook - Bookings growth is expected to support revenue growth over the next 12 months, with a focus on ratable revenue streams [56] Question: Marketing adjustments post-NPD breach - The company reallocated marketing dollars to focus on LifeLock, leveraging SEO, paid search, and affiliate channels to capture demand [57]