MANH - Earnings call transcript Q4 2024 | Manhattan Associates, Inc.

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Operator

Good afternoon. My name is Julian Bell, and I will be your conference facilitator for today. At this time, I would like to welcome everyone to Manhattan Associates Q4 2024 Earnings Conference Call. [Operator Instructions] As a reminder, ladies and gentlemen, this call is being recorded today, January 28, 2025.

I would now like to introduce you to our host, Mr. Investor Manhattan of Head Bauer, Relations Associates. of Michael Mr. conference. you may your begin Bauer,

Michael Bauer

review and and Great. to Quarter XXXX will Associates Thank Eddie Earnings cautionary good I everyone. you, Julian, Capel, afternoon, our Welcome call turn then the to CEO. Manhattan Call. our over language Fourth

make future this of financial During may Manhattan including future regarding Associates. question-and-answer the statements call, fulfillment events we session, forward-looking or the

involve XX-K actual You're future risks may these actual cautioned that statements risk and of and the that forward-looking those differ not refer XXXX you our from our particularly performance in for are the results materially risk Manhattan from XX-Qs. to factor Form we and report in the for updates materially subsequent any fiscal SEC to as forward-looking results important the could Form I uncertainties, as well differ guarantees contained reports that discussion year our projections cause in projections provide that factor with factors filed on statements. annual report

statements. We macro no impact cause and obligation performance or differ environment update our results note to to these global our actual materially under could from turbulent the projections

provide In certain financial addition, additional non-GAAP our information measures comments investors. to to include

the reconciled all non-GAAP GAAP We have accordance measures related SEC in rules. to with measures

on schedules find and manh.com. the website our to today reconciliation in earlier at You'll the Form submitted X-K SEC we

NowI'll turn the call Eddie. over to

Eddie Capel

Thanks, Mike, and good everybody. afternoon,

got just I've a note a I'll throat. Before that bit start, little we sore of

XXXX quarter is review year as results outlook you joining we for if full our as So Thank XXXX. our voice fourth us the my croaky. But well I you. thank for apologize for as and

revenue $X achieved expectations. and share earnings performance for very that the surpassed with to milestone RPO, our operating QX records you per profit, XXXX year in flow successful billion another Manhattan. I'm exceeded share. pleased cash revenue, total So also our and free We new was RPO total

our acute. business growing do strong the optimistic though, more momentum, cautious market on economy, with and about global We remain we're become XXXX entering we're Now opportunity. has which

our our accordingly. customers with of Our outlook the as calendar adjusted we've work our headwinds their business and for about for upcoming surfaced year, near-term services and in-flight reduced services fiscal planned implementations XX% of

us Now services that because growth. us provide our us secondly, success. team to keeps be our help on to subscription that And in in very helping -- partnerships innovation, important our us to allows needs, continues future Manhattan.Firstly, future these customers' incorporate turn incorporates And drive waves ensures close which our customers. it tight clarity to customer of

implementations less record XXXX, in we'll we continue and have Now planned. on of number will to previously than a services, Manhattan albeit little a customer significantly had those spend customers

work to a XXXX highlighted services higher extent, customization first XXXX. before projects growth of With of sequential implementation increasing services summarize, to growth this middle solid periods and that to trough the future returning throughout reduced So and professional for XXXX, the pushes throughout in cause quarter shift QX. we in anticipate steadily we utilization deal partner the will year year-over-year revenue the in some new -- revenue in lesser service services

revenue with revenue with These next us of several that cloud to surpassing our pipeline, of end of start growth and we'll entered drivers, Importantly, likely XXXX achieve fundamentals like new product the unified services confidence provide which bookings have off the includes just QX, several opportunity customers, QX acquisition business And and software large the drivers, subscription the in a of along XXXX. strong on-premise to subscription cloud our revenue XX% plus growth customers front we And solid, though, of growth perspective. we growing our a cross-selling years us. into the great is cloud a conversions by are with portfolio. from benefit new over

product let's as per record X% adjusted million a RPO our RPO, satisfaction performance Revenue diverse. at a XX% perspective, demand to vertical quarter Now outlook. quarterly portfolio. increased high. wholesale solutions, prior XX retail manufacturing foreign XX% client exceeded exceeded across highlighted increased our were $X.X $XXX that to and removed, across -- diluted customer for solutions exchange And and our our continue quarter. remaining the headwinds remain rates share $X.[ expectations. to was if and in just strong billion. reported bookings earnings sub-verticals cloud in the QX billion ]. was to to QX, results moment. for obligation by of XX% more XX% in In or our a about levels are And solid pivot Win increased our XX% pretty impacts drive growth $X.X than From are

global cloud retailer life of designer global care Some health of sciences outdoor global company, diversified specialty that a of products we others. the deals a services chain, this company, and quarter, supermarket and global won a a retailer, home furnishings a multi-brand many distributor company, a

and upsells new about we have X/X cross-sells. QX, we from and was bookings new In a And of growth. believe demonstrates for this healthy future varied to logos, many continue mix generated and sustainable the our net opportunities of conversions,

demand about conversion solid pipeline and we represent opportunity. Our be potential of to our continues demand new XX% strong product across customers Net that significant have with suites.

with to little yet XXXX customers of XX% solutions. just over cloud on-premise enter our we our their As begin to a migration

across million execution in pipeline we began since Manhattan's development. and solutions chain the to to Our billion XXXX, we to innovation. strong $X omnichannel solutions nearly equates supply is journey key This total our in cloud. about commitment driver and $XXX invested our in planning, research And investment our of

our stated of industry is off. level consistent as And I and this commitment I in paying unmatched before, investments our certainly are believe

interest launched and levels market Active innovation introduced For customers supply Iris, from execution. point-of-sale example, chain numerous planning. developed our late prospects and advancements encouraging. is in We certainly total exaggerationexiteration And XXXX, we supply an Manhattan and our of chain across expanding this addressable are

levels planning our point-of-sale signed significant satisfaction. chain already strengthened of customer first in supply customer. In supply Active and X closed execution widened We QX, industry-leading chain transactions, leadership position our our Manhattan we

some Now of the turning to of our specifics products. now

kind weeks. customers Retail were to companies speak at weeks in cloud-native front, a point-of-sale the great to of ], scale systems roll Federation year a our some successfully the our leading a of brands. retail behalf. such XXXX as both at fleet us rapidly both enough those matter good We On in retailers terms the point-of-sale few ago. successful able entire of to And National and these Terex out were with point-of-sale deployments their with deployed for just on in Conference store [ PacSun was of

reached ago, cycle performance vital the store from the clear of is spoke large majority presence and was entered store the emerging, conference, is percentage peak We they data, sales number settings going point-of-sale remains business transacted it's believe seeing for that a that to in-store. ingredient And equilibrium different between holiday technology that our vast the a few in and And XXXX at an store. still finally when software years fully which in great. being online hardware of scale as In we which we replacement we're suspected, a of retailers. decouple

systems systems sometimes stores store the systems. customers in many operating X of and all of even our the are major running X In on now operating

at customer more the point Nowhere outpaced booth seen years. we've activity apparent of National prior than we The had around that was Federation in sale, sale, Conference. anything the level our resurgent interest Retail in of far point

Forrester in interest Now in the our part in of in terrific this showing driven uptick that recent was debt sale. no of sale Wave from point least at point

periods. a named We experience, For designing that world-class -- feature we the scale honored industry-leading differentiated And believe user for this during capabilities certainly the and first of point first truly were depth by leader. reflects sustained sale investment and to ability time, omnichannel as as we're unmatched it well made in building the we've recognition. peak

sixth speaking named of we for were Forrester, omnichannel Forrester and wave. last Now the in the leader order week management a time,

on and software no named available point-of-sale this in significant has note Xx Americas provider been QX. received point-of-sale one no in final believe won past has this what XXXX. in management. Now and the other is most leader the order of the provider point-of-sale both We we certainly one And quarter, other distinction ever opportunities

retail We this outside were and store our stores. an equipment tool technology platform leading systems. a and represents in us selected smaller experience historic us of of be their retailer business footprint next-generation And sweet power associate when differentiating next-generation leading to by value allowed honored specialty important demonstrate as spot to the milestone for to our

offerings. Turning to newer of our other one

year, As I with the retailer middle in quarter, of supply our cloud-native planning earlier, supplies the at we this noted enabling excellence. first point and fulfillment chain Active store having live our the planning the be Manhattan Manhattan pet and early customer technology which using anticipate about we applications transportation by shares that the this management, operational are Active of adopter and belief to key certainly Management, Warehouse unified And they'll planning. combination signed

competitive here. of note. a high several that replacements MQ And We ended and our closed out to Quadrant of product nice at fewer mention Magic being our right of other year transportation end these a management with the Gartner I'll the deals on close business important the update Leaders. highly year

of our technology, unified and difference. And supply made the we chain power platform believe again, the the execution leading

remarks financial outlook. an update my I'll And going and you Dennis our update. with summary prepared that then concludes move we a with before to brief is So close business provide our to on performance Q&A.

Dennis? So

Dennis Story

Okay. Thanks, Eddie.

members execution records highlighted, challenging total our Congratulations operating team the earnings great cash revenue, per profit, throughout around to Eddie year in free we As XXXX, globe in environment. the for share. a in and macro RPO, set all flow

strong year both to on compare the growth exceeded expectations both Rule year, performance QX and of the For line XX. quarter our delivered and margin, operating favorably a and and full financial we top the results balanced

start quarter for financial I'll recapping our and with performance year. the

did impact not volatility meaningful total a have our FX it year revenue persists, While full growth. QX to

headwind million guidance, our a I'll growth was FX year RPO also million However, to $XX headwind impactful meaningful to a a discuss full sequential it to growth. had later. XXXX which RPO and $XX

All basis, an our stated. to Now as-reported results. otherwise are growth year-over-year on rates unless

year revenue up was X% and full For up totaled revenue $X.XX total XX%. $XXX QX, billion, million,

and maintenance compression removes growth revenue XX% by year and XX%. revenue, revenue full transition, which the cloud license was Excluding our QX

closed XX%, QX $X.X XXXX totaled RPO up revenue million, full we We out billion X% and revenue bookings with up record of XX%. had year-over-year in growing as $XXX with cloud year million, sequentially. $XX QX XX% totaling

strength $X.X outlook by impacts, $XX Active million FX of RPO exceeded end the billion experienced Manhattan of Excluding ] products. as high our our we from across [ suite

to revenue was year more $XXX period our Service was slightly pronounced $X constraints up budgetary customers. prior expectations million ago of below were the as compared several million and for

totaled profit million XX.X% $XXX million profit margin a year-over-year XX.X%, an $XX XXX with Full point a Our adjusted operating was basis operating over represents of XXX and QX basis operating a improvement. margin with improvement XXXX. adjusted operating year representing over

with QX were cloud growth, our as XXXX leverage scales. and driven results strong by revenue solid Both operating business combined cloud

share Our or increased of or million QX includes share XX% insurance to an $X.XX a earnings [ GAAP behalf from health GAAP $X.XX, X% $X per The $X.XXX claim ]. charge to a on earnings and nonrecurring decline declined employee. per

Excluding this share earnings per earnings XX% $X.XX. have per This and in increased $X.XX would claim, resulted share to XX%. earnings to increase to adjusted to per GAAP XX% share increase GAAP year full

$XXX Moving cash to EBITDA adjusted margin cash. flow million cash to XX.X% XX% flow to free a XX.X% with QX a margin. and operating increased

and was operating XX.X% a margin Our flow $XXX generating while full million margin. flow cash free XX.X% adjusted EBITDA year cash

in revenue our increasing given $XX the Deferred quarter, sheet. up share from in resulting balance leveraged in our and collections We Board year balance year-over-year cash million share and the prior we $XXX invested buybacks repurchase ended in $XX to the of our cash $XXX our customary million debt. to $XXX sheet, XX% cash in strength and Accordingly, the in increased position repurchases XXXX, zero authority million. increased the solid $XXX with to Turning million million, million. visibility, strong

guidance. to So turning

Our financial comps. operating deliver is software growth benchmarked objective to margins quartile against line enterprise in top sustainable top double-digit

basis. on calls, our earnings RPO on our an outlook to noted annual is As goal update prior

by our today's using rates QX. in quarter, close discussed, deals relative lumpiness the large preliminary provide nonlinear call is the on All of their previously bookings throughout of the conclusion ranges parameters as we we of the made value guidance and bookings remind that or performance at can midpoint potentially Additionally, be number impacted respective and investors FX our year. will at references cause which any

For than the million billion XXXX billion RPO, XX% targeting higher parameters. the FX billion midpoint, representing $X.XX $XX is with are now preliminary our $X.XX $XX growth. RPO we outlook $X.XX to headwind, million Removing our

we guidance, parameters reduction million expect our Eddie as XXXX preliminary of total difference and consists to in FX of highlighted, now full million the billion, the billion revenue revenue. $X.XX headwind, $XX For year of from $X.XX services $XX a

result in and million total we about to QX, in in QX. million, of total revenue and $XXX will million This $XXX $XXX.X of $XXX targeting $XXX QX QX million in million are revenue

margin, quarterly operating be accounting in adjusted adjusted to margin is basis, XX% XX.X% XXXX in midpoint, we a expect range XX% about For our operating a peak expected is unchanged seasonality, in QX QX. the and QX, in XX.X% of On range parameters. in the to prior from XX% at and QX, retail XX.X% for FX

predominantly results including $X.XX nonrecurring range GAAP adjusted and -- a to year $X.XX $X.XX nonrecurring insurance in of are charges, This health $X.XX full EPS included GAAP claim. in a range $X.XX, to guidance from EPS of of

adjusted GAAP targeting of of to share earnings share $X.XX per are we $X.XX QX, earnings per $X.XX and to $X.XX. For

through expect majority with equity-based about lower QX and EPS our share per $X.XX for per vast QX, earnings the than GAAP be we investment adjusted to compensation. accounting For quarter

So here XXXX details our are some outlook. additional on

For represents parameters. growth XX% in On full to is million and expect a and midpoint FX, QX of $XXX million million million unchanged million $XXX QX $XX.X $XXX we in our revenue this QX. and year midpoint, quarterly from million. the $XX.X basis, cloud $XXX.X QX, earlier in At assumes this the in XXXX,

million QX ramp. to For throughout million in QX, steady this of service $XXX seasonality for basis, $XXX.X now $XXX peak assumes ].X services, expect QX, million On accounting range improvement retail assumes million a [ year $XXX in and we and in in as $XXX a new million quarterly million projects the [ QX. growth $XXX ]

$XXX to decline of For or maintenance, to the a on midpoint range million XX% we a million cloud. $XXX expect attrition at

to QX, million; million; basis, and QX, $XX.X $XX a million; expect QX $XX we be On quarterly $XX.X QX, million.

of to $XX.X revenue million be We or roughly total license expect X% revenue. XXXX

to For and $X.X between quarter. then revenue QX, million $X.X we per of license expect $X million million

For between quarter. hardware, to be $X.X per million expect $X we revenue million to

subscription, about targeting For margin, for basis a consolidated XXXX. we are maintenance XX and year-over-year improvement services point

effective expect and which million to XX.X be XX% assumes our our activity. no share tax We count shares, buyback be rate diluted to

Eddie Accounting our drivers, on cloud pipeline financial to as better revenue on assist Lastly, growth of RPO solid our highlighted, color strong years, that expect revenue continue and next be we updated we'll to a we cloud assessment regular several our not XX%-plus growth. visibility, future incremental providing and invest for model investors cadence. growth for are multiple growth, world-class to to subscription achieve the in innovation drive future will

XXXX So XXXX excited in summary, beyond. and year, was we for are tremendously and a great

Thank Eddie you, and remarks. closing to for back

Eddie Capel

off mentioned QX, was great In successful is Very a Dennis. And Well, you, good. QX before, we very for record achieved XXXX Thank Manhattan. as I year well. as to bookings. start a

headwinds, some And fundamentals with for there's are XXXX entering near-term very, very choppiness sure. continued causing we're macro services is while motion solid. software FX So a Manhattan's structurally, selling considerable noise and strong business very

enter as investment XX%-plus industry-leading contributing levels leader industry drivers increasing but strong to market we're with levels technology. Record that with TAM durable satisfaction of numerous pipeline a for excited world-class we're our opportunity customer about rates. R&D and our XXXX, are and we win And got We've growing growth. our of the

our that work call. customers, closing, the concludes remarks. joining the our -- that team thanks, everybody, global and for prepared they in great all So our for Thank you for to our do includes

at we'd point. any to be take Julian, So happy questions this

Operator

Instructions] [Operator

our comes Terry from Tillman, And question Securities. Truist first

Terrell Tillman

or here, Eddie. going thing sore may have I have X X questions. on I throat a too

RPO. to the first million The constant related question currency $XXX just is

a past started XQ in well seemed bookings just and high terms in XXX.X%, shed or little was strongest. a where in though, light the I starting Any XQ seasonality, of just see in watermark that and curious, quarter. around are first bit I'm first near-term in I the maybe 'XX that pretty you're could confidence to XQ asking you print. during XQ But I've and to like strength way visibility said quarter. been of mean you you more off think cloud last got activity the solid back the repeatedly the here

Eddie Capel

No. seasonality particularly the a year, Terry, of be previously, to slowdown -- little middle QX way QX. Yes. really record answer a in to the same yes, a was strong I internationally in I'll other and any the us, start probably vacations, mean, I we're to sometimes than have it's off due seem maybe so But forth. doesn't but and for

about certainly that. well. across balance product the versus was new geographies excited portfolio, So as the we're and existing encouraging The customers

Terrell Tillman

about a even of just seeing well software prepared what And But stuff sluggishness demand-wise. a here in with too it tale cities. have And with whole services, of year, in X early question, resilient curious a listen plus quite coming actually cloud. tell, and remarks, out. of is towards it's end Services, to some I'm and versions a you so sounds this -- maybe it's the your Yes. breadth. part follow-up each you're beta maybe but new X bit like And there's different model is the

so you then last going And question. just on I'm have we cyclicality with structural curious services maybe And where dynamics a forward? versus I think are

Eddie Capel

in we've that an There's particularly Tier Being that's impact software, the having I there efficient, But having is so implementing question, no impact. we more much seen software, space, on well. there no our as the implementing our becoming that were some X think, budgets. Yes. and are more are now, unequivocal question pressure partners leader more that's

they much wanted cycle, year our it, their September, year, about I XXXX. of more calendar were last into budgeting completed to went As they customers August, how we October as think, call bullish, get

companies XXXX implement software to and us, as cadre quite not originally services dollars their got, much of honestly they that with team continue a spend in budgeted of fall fabulous the our are whole -- we've last the during anticipating teams going significant Tier are X when as obviously, And just to year.

So I to back a pulled bit, think their had trickle and down us. they budgets little that

Terrell Tillman

on cash in to a free question there's just cash terms And But flow. could that don't it. EBITDA don't. -- of curious cash margin. I'm or flow, kind though anything of you free flow Got any a for number flow free know should range in just Dennis, either of guide I'm nonoperating curious hard like terms another about onetime cash just share I operating you free or they to of But profit items things about some around free impact or or just anything relationship for just think cash maybe cash flow we flow. typically maybe

Dennis Story

flow million I cash say roughly a collections. a on just billion close $XXX XXXX, rate year targeting Yes. and about We're would be $X.X Terry, of of to terms out. we're about probably going at basis a through in run cash full quarter

Operator

Our next from Joe question Baird. comes Vruwink,

Joseph Vruwink

earnings overnight, But later on back contract. these their then commitments. X/X they also the years expectation with touched customers of maybe another dynamic or cloud potential customers X on is Great. the where and scope are SAP making come X call initially, this only large it's

Is happening this typically full all dynamic warehouse this expansion. I the just changes room here? that intentions the and at it's Is for WMS of future not kind happening service know any and grab of with represents noting of kind that your in might you're you footprint, engagements?

Eddie Capel

lot That's several really, now. for happened quite a Not years Joe.

to number may or XX be, XX have and X. they'll customers, or X, our the centers may whatever commit X oftentimes, they So distribution

and not several that So seen that to be years, to for be us. ongoing. expect dynamic we a -- it new We've expect is that we for

impact. of a dynamic any not kind not it's new and it's having So near-term

Joseph Vruwink

begins some mix around in of big on point RPO like breakout obviously, Okay. year-end and kind Is sounds And I at sales of got think year-end. an to intensity Active what happen. to does Could actually wins shift, mix? given wondering, services it TMS. you end you've the that provide shift of the your WMS you that to I'm a in needs maybe product of a past, contribute update kind

also that Headcounts? and go-forward kind Rightsized so And your of factors

Eddie Capel

in Joe, difference There's across Great. answer not Yes. Yes. conjoined really sequence terms a there, big rate. attach not really. of couple in of though, of a the questions reverse the Great services set is portfolio

attach it So least directionally, planning, similar TMS, be whether or point-of-sale, at services rate. WMS, OMS,

the of of don't terms detailed we RPO, In breakdown breakdown there. a provide

But tell WMS, would TMS and of there's the certainly you question. by from followed no I then comes by followed preponderance that OMS, sort other.

there's than with -- this more are It's -- nobody me. slow. We it's impatient

activity, But subscription up. the and seems be point of implementation sales definitely to activity sale, picking activity

So we're encouraged by that, for sure.

Operator

from comes Brian Raymond And our next James. with question Peterson

Brian Peterson

just that stats question. on are maybe active customers And signed Joe's up of number the past, Eddie, think WM the or on live. in some I you've mentioned following

we any transition Just little we as about as in through the giving a help think about stand XX% specifics made entering that transition, on maybe that have progress you've on that 'XX. we more where

Eddie Capel

live Yes. Well, and forth? of customers in terms number of so

Brian Peterson

Correct.

Eddie Capel

the little little a than our on-premise. still we're below XX% yes, -- customers, we're XXX think of XXX live And XXX over about I a world. around customers tick more facilities a just

that inverse have is quite the So of not XX% migrated.

Brian Peterson

out And that it. definitely I point-of-sale. was NRF interest well. agree was I'd up at wanted you on with to just I the follow as there. Got

a much think of XXXX? of momentum that macro product to cycles this in you've in -- cycles around what refresh you do could your As lot point-of-sale past. customer I'd cloud-based how you and seen of optimism the the there kind sense love see is get and

Eddie Capel

terms much of I enthusiasm exactly of and do Yes, that don't able probably forth. the to I cycles away quantify love momentum, the that. stay Brian, if But be I'd for can in know replacement specifics to how so from

little about I I a technology. been upgrading talking system store but enthusiasm think technology, think look, around is there while, we've this for

you as driven merely consumer. is know the -- it of just just hardware It stores. aging by it's out a probably as in aging Some out, the

out, at prepared this is desire definitely NRF. selling retailer's omnichannel pointed and more store and strategy. retail foot bifurcated remarks, lot a you the But of enthusiasm strategy to as in by Some our very true out interest have their driven traffic a online it versus we as in pointed

a but frankly, inbound be unsolicited encouraging. in conference, conference, of, which a certainly was saw Retail that the interest expect at Federation we lot would You

Operator

next Sandler. And our Gabrielli Quinton comes with question from Piper

Quinton Gabrielli

in all helpful is that Maybe and opportunity is strong And constant magnitude that kind of Or QX of first, and kind assume of talked we it much QX the to would incremental kind to QX understand of impacted QX deals currency those about it of the there be how deal QX prior pushouts to fair quarter? catch those in here? push in and bookings closed for that the up?

Eddie Capel

They We're detailed not have all months, in closed. No. of the not around some the going longer, to across those and give specifics closed been last just maybe But that. obviously of haven't empirical haven't. all news closed some that of pipeline is are have them good XX that deals The yet. we even

haven't We them, lost right?

there's will a year And the towards company opportunities of there it, buying a into budgetary right, cycle. There circumstances full end out enter they of to the certainly decide get year still full they're us. push for are cycle. the a So out where as going

don't like not but we it's phenomenon. -- not uncommon So it, an

Quinton Gabrielli

do large side? to transition on decision pushing of to and leveraging the services growth? of balance also partners that cloud understand. maybe how Or I first control, maybe while Got services and your services focus the or decision that FX it's kind out in pushing kind here there's of accelerating I more helpful. of the cloud company's your of then it. desire that's kind does this some That's on messiness creating some but accelerate And XXXX. understand line, you accelerating obviously, the

Eddie Capel

question, great a Quentin. That's Yes.

In frankly on this I and Obviously, prepared for makes so or to been growth remarks, very growth software my we've revenue, long -- line, the we said expect sense. saying XXXX, XX% So with with perfect that in a okay? the software revenue services time. exceed as

in tells you that obviously, so going like so on and 'XX, trajectory forward. 'XX forth and looks Now the what

continuing a is rate software So to faster grow services. at than

services very us, is important to still us. important to very Now

our of but not case and we build of to we couple a as what that's go, is, growth important because do, of investments a core where services of the long-term line top for are put reasons. course, what very together, could You it's core innovation software important as

of be really it's software. client to are second that success One, And we secret customers feel an we'd part the that great important important get with they ensure from innovation our source. that engaged of our all,

staying can very, innovation them, the front very of understand So pace what be, important. are of is to I a we trends close build say, X/X them in so market often very to market we as in

there. bring the again, crossing good much no revenue faster software services point to certainly from a line continue moving But away no, But that intentions But in of grow you business. to the XXXX. up with we expect

Dennis Story

Story. Quinton, to to Dennis apologize. want I just it's need

flow the should of with -- target be XXXX, $X.X collections million cash free in the end cash On $XXX year year, full billion

Operator

Our Schappel comes Mark with Loop from Capital next question Markets.

Mark Schappel

by you on the big CIOs being Eddie, that there with starting expansions. other sentiment forward out with you're even these initiatives out you, what's Are seeing crowded moving seeing priorities? from say, WMS or TMS or upgrades

Eddie Capel

in XXXX. perspective, we say with think able retail. if compare no now a diverse conversations is base would of But we of NRF, you're one about kind customer of much that than retail. just of XXXX, But which more sentiment from question we a obviously, at January concentration January the have place have I if to

tone So the X was XX view a couple, just than was would more my much weeks it be months ago, enthusiastic prior.

Mark Schappel

Great. With or planning during just could solutions. supply switching the a provide the additional And some built quarter. here. you customers then gears new you the respect to if was on wondering bit comments up reference I that little chain color

Eddie Capel

close sort honestly customer of first were we surprise. signed our midyear when initial supply And you When I questions kind of estimates quarter, launch was to a prior expect applications such some see some which in about know our the Yes. we there impact so as should call, first chain were we a our mission-critical forth. Well, planning. our customer and XXXX. that On would

after that what We days launch. that closed our like more be or excited XX we So couldn't deal. first something

to we continue truly seen ton together a enthusiasm unified a chain to supply But supply takes of deals bringing into while platform. have and closing. finally, that translate execution and planning usually Now chain on a see enthusiasm around quite

and to again, have or days customer early XX gives reason visionary certainly So for after adopter so, first us enthusiasm. our

Operator

our William Davidson. And question D.A. from comes next Jellison with

Will Jellison

light the I organization? services, XXXX, The kinds spoken organization, professional because just thinking relates in within I labor update the strong those hiring first are to get attrition you've record services increases for of an in past, force. on in related updated how And that you where was to the trends. about with in wanted expectations that part and low in in to in to curious are efficiency we some services And of

Eddie Capel

Great questions. Yes. question. great Well,

first And efficiency efficiency very to There's certainly question continues professional our services to we of is attrition all, get better. our and in the So -- grow that. about low organization. no continues

that efficiency. So a to of continues again, driver be

hiring, In out We've very got we've balance terms to obviously, state to the a and demand in obvious. demand. downtick seen supply of

eye very like. a keep we'll So close looks what on that profile

time to for it hiring of looks in situation specifically in XXXX start But able to profile back half like. the up picking the what services expect we got the be decide we've that We year. monitor before

Operator

Dylan And our William from with question next Becker comes Blair.

Dylan Becker

onboarding being on in services, don't NRF. we kind think that want coming about You of for to the maybe, agree talk between a out how would lower enthusiasm, hammering impact number versus causing additional to but of Appreciate any But the pushed maybe spending? can perspective? are color the projects from efficiency And Eddie, partnership of it $XX on the kind continue about types live project of I customers of million internal out mix and expected of being record pushed general tenant which what's what's growing with maybe here. sentiment that the of are I kind point you, 'XX, here? go of

Eddie Capel

Yes. going the phenomenon exactly that across Well, OMS maybe a customer how to not multiple roll But million to large and that $XX obviously, a brands. out to something the provide scale or across of they're -- this, they're breaks that we're specifics bigger going going out is down. -- a state we goes WMS that maybe like with program have roll

WMS OMS. rollout in say, continues. seeing XXXX we're planning hypothetically, were XX XXXX the or in the distribution X they was case centers of it in is What brands Let's

be XXXX, in X. That's of brands phenomenon the doing doing of X seeing. instead distribution it's But going the Instead XX for that type going of in brands. OMS of XXXX, it's to centers be we're X to

projects budgets been forth. yes, no So canceled, clipped. cancellations so right? no seen have there's We But be have and project

tended have rollouts. those down So of some our to customers slow

Dylan Becker

into Okay. the industry here. data can helpful. importance fuel Maybe ties kind again, of with how if that about, about the get a here. through curve willingness sticking one latter their our data that we where understand and that of readiness Help help maybe of That's more propensity But modernization. real think think you, of and perspective, Eddie really planning adaptive adoption If to or the early maybe and forecasting sits accelerate the we flows planning it how us momentum from time of to maybe cloud kind more in performer. kind

Eddie Capel

large but a a take XX it enabling at Yes, they the up, time batch the the to the essentially and ready the it real is a we're with systems over same it process and any run running overnight in forecast to exact in slice some because of jobs. we're last execution planning data point overnight, data speed the -- the forecast And really, and queue pace up along create years. the All is the to the so on execution a of using available have gained going or of because to last they run But over and catch be run plan overnight the XX data obviously the essentially of accumulating able way, longer, speed data plan. sure, it instead inputs. for to ready. The job generally batch

make catch planning pace. of execution with that to up is to starts goals And one we're sure -- our

data So just a processing no we availability. a would concerns that into goes there's I -- lot real-time like the about that do, is batch-based system. system it moving to from change tell you, management of else everything a

management change So unlikely availability, likely through more to to be be process. the lack data that of getting

Operator

final come from question with George will And Kurosawa Citi. our

George Kurosawa

how Sorry of maybe to you're kind kind of your current view on here, to on just if start potential positioning? house and impact the there's changes politics thinking about of with tariffs your but any the business

Eddie Capel

there question. if Obviously, monitoring tariffs we the perspective, our chain really are business. sure. Good on no expect perspective impacts we're a our to and Yes, from supply situation customers. From any our

a systems provider. Now supply given we largely chain finished goods that are

what be the likely of do So ports from, the to Associates, when most there's from happens goods the come port hit Manhattan on impact hit we they -- wherever a little George.

George Kurosawa

I Okay. services, of looking be that benefit. OpEx kind from software mix target. in? margin initial intuitively To Makes any think did on there'd your just being bit want guess with than me, Or perfect kind relatively you're more maybe Are I maybe to think ticked any ask stronger tiny guide, the invest lines would sense. change there down I And that the then there? to I a on of color some

Eddie Capel

look, to -- running. last XX I'm development research years we and we're to development going save will anything. our for increase in -- if than year. the proud been We're, did XX we Well, and research able investment always We're frankly, years spend in more year last to this

over years the sure. that is XXXX true, last again, So XX for

We will and decline. sales line got portfolio. product we've top a impact from the we've marketing some that revenue FX Obviously, got in and given broader money spend noise more

Operator

floor back Eddie There to time. this turn at to remarks. are for further would like closing I no Cable questions the

Eddie Capel

innovation. the fundamentals for seen really downturn for is our voice built innovate. for toughing little are continuing that you, me our Julian. cookie seen Thank we've fundamentals our demand to thanks, XXXX, product Well, very with innovation here, Whilst before. We're choppiness because we've with mentioned in strong. business strong around services a everybody, are my The some

look ever in to we've long-term more so. or been as and encouraged about days that future, we as about telling are forward we XX our So you

again. thanks So

Operator

teleconference. for that, with does We your participation. that thank conclude And you today's

You may time. at disconnect lines your this

Manhattan Associates (MANH) 28 Jan 252024 Q4 Earnings call transcript