Topic: On Wednesday, ASW announced the much expected rebranding, but more importantly opened its social network to a broader audience by introducing a free membership option. In detail:

New visual identity and logo: Following nearly two decades of an unchanged logo, ASW's rebranding (see p. 2) highlights the stronger positioning as the go-to brand for luxury travel. Moreover, the slogan "Travel - Discover - Belong" is introduced, which also textually combines the ASW community ("belong") with the anciallary offered services for travel ("travel", "discover").

Free membership model to drive member base: Simultanously, ASW introduced a fourth, free membership option which comes in with 90% of functions of the premium membership. The paid options (Premium, Signature & Prestige) remain broadly unchanged, however existing members now have the option to downgrade to the free version, which could impact sales negatively in the short-term. However, a potential downgrade comes with a loss of functions and benefits which are liked by the members. More importantly, the reduced entry barriers should ultimately drive member growth and with an upselling options. In order to protect against scammers, bots and a potential loss of "community quality", ASW implemented safety measures such as member verification.

Increasing monetization: next to a broader user base with the potential to upsell to a premium membership, further upselling potential to ASW's services (e.g. ASW collection, ASW Private, etc.) should ultimately offset the potential sales decline from membership downgrades. Moreover, attractive third-party products (e.g. creditcard or cruise ship companies) offered exclusively to ASW members should yield additional sales.

All in all, the aforementioned business model change should impact sales and profitability (due to P&L effective pre-investments) in the short-term, but ultimately offers the business model more operating leverage with diversified and more profitable revenue streams thereafter. While this does not happen over night, we expect the full effect by early 2026e, explaining a FY'25e still below historical figures. Nevertheless, the stock is attractive at current levels, offering a 8.5% FCFY'25e (19% FCFY'26e).  Against this backdrop, we reiterate our BUY recommendation with lower PT of CHF 4.00 (old: CHF 4.30), based on DCF.