So that macro view of digitizing, using technology to make decisions is happening. So now getting to the specifics of your question. So when you look at something like Estimate — so when you look at something like Estimate-STP, what you’re seeing is that it really speeds the ability for staff appraisers, for consumers to send in picture, get an estimate or jump-started the repair facility really substantially reduces speed at which estimates that can be produced. And then when you think at solutions like subrogation, where you might get in 200 page demand for inbound and our solution in a matter of a minute or 2 can really give you a very fast and very precise response that increases the accuracy. So every single solution we’re developing has these characteristics in terms of efficiency, the effectiveness, increasing the productivity of people and a very specific ROI.
And hence, that’s why we’re focused on innovating across so many different solutions.
Michael Funk: Maybe one more, Brian, if I could, quickly. You’ve talked about the cloud infrastructure transition that you are talking from private to public. Any comment on how to think about that impacting operating leverage or margin as you’ve made that transition?
Brian Herb: Mike, yes, we have fully transitioned. So we are on the new infrastructure and serving clients and deploying solutions through that. We do still have some legacy cloud environment that we are winding down, and we’ll be doing that over time. And so we talk about IT hosting costs being up in the quarter. Part of that is just the growth of the business and building out against the pipeline and innovation and then part of it is the decommissioning of the legacy platform environment that will wind down as we go forward. Overall, we’re still really happy with the margin progression. We had about 240 basis points of margin progression quarter-over-quarter or year-over-year. So again, within that, we feel like we’re in a really good spot within our cost base.
Operator: And our next question is coming from Tyler Radke of Citi.
Tyler Radke: I wanted to ask you, Githesh, about the new event-driven architecture, you referenced on the call. I’m sure we’ll hear a lot more about that out at the conference here in a couple of weeks. But can you just talk about the theoretical future use cases, what you’re doing from a back-end technology perspective to enable that? And if there’s an opportunity for monetization, either price increases or new SKUs with this new architecture?
Githesh Ramamurthy: Sure, Tyler. Happy to take that question. So what we have done over the years, as you know, we have been running a multi-tenant cloud platform for many years. And one of the key things that we see in terms of getting our — giving our customers a step-up in performance is really taking events and decisions that are taking place across the network. What do I mean by that? That means you might have a repair at a repair facility that is not actually a repair, but might turn out to be a total loss. You might have some other decision on the medical front. You might have a consumer who changed his or her mind about something that needs to be reflected downstream. So many of these decisions and events would take a lot of time to move from one place to the other.
And what we have developed is an event-based architecture that really very quickly moves events from one place to the other, maximizing essentially the overall performance of the claim because there are literally hundreds of decisions that have to be made in every claim and the permutations can be intense and the data that’s needed can be pretty intense. And what we’re seeing with our AI, which is — which has been delivered in line with existing workflows is the combination of AI and this event-driven architecture, we think, as a major way to really deliver more functionality and capability. And this platform, which we call the CCC IX Cloud, is an overlay on our existing architecture. So customers will get it automatically. It’s already included.
There’s no upgrade path. It works. Everything works without disrupting what they have and works in line. But what it really does is gives us the ability to deliver many, many more innovations across the entire supply across the entire supply chain with those solutions having very unique and specific ROIs. And those will be — those solutions will be deployed by customers, and they’ll have their own unique ROI and pricing, but not for this architecture.
Tyler Radke: Very helpful. If I could ask a question follow-up for you, Brian. So just on the emerging solutions contribution, the 1 point this quarter sounds like 2 points for the full year. I guess the path to get there, should we think about an exit rate of 3 points or something above 2? Or is the way to think about it is it ramps up to 2 points by Q4?
Brian Herb: Yes, Tyler. Yes, as I said, we’re going to continue to see the step-up as we go through the year and the contribution is going to be larger in the second half. We’re not specifically breaking down kind of exit run rate. I would just reiterate the 2 points for the full year. We feel good on over time, we’re expecting and have talked about within the long-term guide, that’s stepping up to 3 to 4 points, and we’ll see that progress as we go from how we exit this year into ’25 and beyond. So we’re not going to get more specific than that at this stage.
Githesh Ramamurthy: Tyler, there’s just one more thing I’d add to what Brian said. From my vantage point, all the revenue we deliver today were an emerging solution at one point or the other, right? So when you think about it, all of these solutions. In fact, they all have very long runways. And what I get excited about is that some of the solutions, which were emerging at 1 point, 10 years later, 15 years later, they’re still continuing to grow, and some 25 years later are continuing to grow very nicely. So our focus often is on building and delivering those long — those solutions with long runways. And I just want to make sure that I add that piece as well.
Operator: And our next question is coming from Alexei Gogolev of JPMorgan.
Alexei Gogolev: Githesh, I wanted to ask you about payments. You’ve mentioned on today’s call. Once again, the $100 billion in transactions on your platform. When do you expect to see a more pronounced tailwind to revenue growth from greater involvement in the payments flow?
