CXDO - Earnings call 1 2021

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Operator

Good afternoon, ladies and gentlemen, and welcome to the Crexendo First Quarter 2021 Earnings Conference Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Steven Mihaylo. Sir, the floor is yours.

Steven Mihaylo

Thank you, Catherine. Good afternoon, everyone. and Crexendo. Chairman Mihaylo, Steve CEO of I'm I Crexendo First welcome all to the of you Quarter want to XXXX Conference Call.

team. with not Ron I've the with. Jon today make call President ever our General that Officer; had the the master's me the an Chudasama, the our sales; to Spitler, with Doug Benjamin out degree, undergraduate Korn, that with I Head Theresa rest point are and But On me team people Gaylor, of have and Brian have of and also Jeff COO; working our average best Vincent, pleasure an Channel includes our Weitzel, Brinton, CFO; VP years up entire and some the of of Counsel. The Nishith our want is Chief Revenue over Joe of today degree our executive Engineering; Controller; XX and management Seeler, Operations. our VP a experience. These of -- all our individuals team

then Executive we statement, And and all degreed will drafting David about Frame that ETSI. telephony. and Jim In will in or experience. has -- also harbor years who Doug the ask will and would is agreement? Buch, David numbers. that, addition, for our in companies. I'm is This Architect team please and in questions. Jeff, safe MBA; platform, to provide be and going Ron we up engineering management also call safe will of NetSapiens a after President, a standard we and senior Co-Founder is his spent NetSapiens' of the sales executive The XX an also senior NetSapiens will detail Anand that adding -- electrical business harbor from Murphy, merger and provide our engineer. Vice of career be general and holds with TF a the the of to in Co-founder read management some an also NetSapiens degree brief are will Chief NetSapiens MSEE Wang, quarter. participated Jeff CEO Relay we to IEF I adding excited both on who which to perfect update, Forum give a over most you the have the comments more the read open of degree

Jeffrey Korn

a I opportunity to Securities Steve. remind that take Yes, the meaning statements Securities forward-looking of forward-looking are the Act harbor this Private Act for provides Litigation of the statements statements. XXXX statements Securities All to this will call statements. of this within listeners such Act other Reform safe and XXXX conference of fact want forward-looking XXXX. contain historical of in Exchange The call than made

other Securities any forms the not company's forward-looking the subject expect, to statements include, such XX-Q risk does statements here aware risks results in explained call materially fiscal including as XX, factors are actual information, and cause discussed uncertainties are in any could will circumstance. I'd new publicly Crexendo Steve? and that on similar events anticipate, the other the expectation a with those from believe, the back assumptions result year XXXX, to now update based ended future any statements of turn not filings XX-K and Exchange undertake and as forward-looking like December differ today. words and Form or identifying Steve. and to, are filed. for Commission, as whether to to of detail These to but revise statements, limited should any forward-looking be that statements. Investors Forward-looking are estimate, listeners obligation or

Steven Mihaylo

quarter has and we is the are to but order starting back. more People to get normal and an This space This life Business to time country a Thank of an back is in Crexendo from Crexendo. for you, work Jeff. exciting for captivate, new amazing the coming are us. anywhere. great business was particularly as capitalize is a for on suited changed business

have profitability or associated with loss, to of if going, have would with streak would the share. the impossible. that common diluted kept net expenses knew GAAP While per of and our non-GAAP income we merger make profitable, non-GAAP basic not Even liked the I remain we difficult, GAAP NetSapiens $XXX,XXX achieving $X.XX

XXXX promising increased grow consolidated service first trends. of are for to UCaaS business. the first increased quarter the to continuing revenue revenue XX% These quarter are XXXX, XX% We very the and service compared of year-over-year.

and believe story. we guidance annual be give have X X of And increase most team than financial accomplish I better. I told opinion, While not less the satisfied the growth do anything entire we more with next can or the important this is for XX% my revenue is I years. The not or that won't

we have know, already signed with you As agreement NetSapiens. the merger

received already Our proxy to shareholders, is the their NetSapiens and out shareholders information. have our

of merger. more votes received Crexendo merger a and have us has shareholders the their the approved the majority of have approving a the than of NetSapiens We that advised shareholders majority

formality telephony. both live such, we the be closed will that and of sleep our As is month. This merger merger the this by the meeting game changer companies. hopeful only of shareholder are and have we We a end for And then eat, closing.

opinion, telephony in which them us. NetSapiens NetSapiens team best offer have Our and our the and customers solution to the to customers solutions, mobility best community current be Crexendo's make am the are We'll convinced the work NetSapiens video closely the will able leader. collaboration also team service. I even in in the than the with my certain better, benefit industry,

was footprints. our sure, at North in platform spotlighted in Sullivan's report as NetSapiens big company, win in UCaaS increases shareholders. market. a will am also with the a combined This UCaaS in be report recently ranks the growth our North fastest And merger third-party & American NetSapiens rate Frost #X for market. seats I the American Our the both

'XX of XXXX. will for growth million benefit and for This that necessary XXXX we a $XX.X and every improve $XX.X to said, for to to of revenue Crexendo is our of the -- hallmark nearly consolidated million primary investments continue make or efficiently, increase XX% strong With merger penny forma watch pro as our represents company. company combined a Our this all for running shareholders. A will we grow money. company single of shareholder is the

we We have acquisitions. our company uplist successfully profitability. brought We have grown followed plan both public were able bought the were able organically offering, We the to and to company NASDAQ. the -- carefully. organically to We and through have a to

We have be XXXX Ron. meeting more our future. growth. With convinced I'll will, continued been of I turn on the to on plan. our that, I continue never to Ron? over am certain spent delivering will

Ron Vincent

million Thank the quarter year. revenue million first prior as Steve of the increased Steve. mentioned, quarter for total you, Consolidated $X.X to the $X.X to compared first for XX%,

prior Our first consolidated reported the the quarter million of $X.X for quarter for service increased revenue to first the to compared XX% million year. $X.X

segment $XXX,XXX year. consolidated decreased only the quarter reported Our for the $XX,XXX decrease the quarter quarter the revenue or for a of Telecommunications the as service in prior service first by to Service increased to segment to offset $XXX,XXX $X.X year, compared or XX% prior million decrease the million to first our quarter revenue. for for compared first Product $XXX,XXX $X $XX,XXX X% or XX% for revenue Web

for million Our to compared consolidated the the to the quarter quarter year. $X.X expenses for first million prior operating first XX% $X.X for increased

share expenses for to of per a accounted compared compared the share $X.XX general quarter, of non-GAAP making quarter per of the basic a loss first diluted $XXX,XXX per $XXX,XXX basis, diluted or that our the the the for of first During prior first $XXX,XXX and and for basic a share and $XXX,XXX or share $X.XX $X.XX up and $X.XX net quarter year. quarter diluted and income common first to year. expenses, prior common common for large of basic acquisition-related of additional part administrative increase. Net same the net diluted period the of or On for income $XXX,XXX or basic as per

EBITDA was income prior as in of $XXX,XXX the compared for quarter for same earnings same the year. to $XXX,XXX $XXX,XXX prior EBITDA the as Our first compared of of the for $XXX,XXX of a the to was period quarter period loss Adjusted year. the for first

$XX.X balance cash million activities XX $XX.X cash, equivalents equivalents. cash restricted was to compared and of as cash, December $XXX,XXX utilized XXXX. Operating Our cash XX, million at at March

cash cash, President call sales primarily restricted utilized activities of financing And option million from turn provided cash, recovery. for and comments over investing Our our on cash, activities additional the exercise. I our equivalents. by stock Doug now provided $X.X Gaylor, COO, and equivalents proceeds $XXX,XXX cash of will to

Doug Gaylor

revenue. strong strong revenue and increase along Ron. stream, XX% QX UCaaS currently of a revenue with year-over-year XX% increase in our end of had year total NetSapiens On a merger platform numbers, users. increasing We to we recurring UCaaS announced a that million a top our with the year-over-year Thanks, revenue a exports strong -- the service revenue add will that tremendous north X.X exciting with begin

We and also this month I are in I on the new for our on VIP, concentration us, made to platform in our will investments UCaaS offerings stands offerings phone. this game which highlight will video, significant launch that current prepared offering changer moment. with more and VIP Crexendo our a enhance for and a interactions will believe that be

need from and despite testament our economy to in survive year-over-year, headwinds that environment. the strength of today's pandemic to business growth a most from slowdown and revenue the capabilities solid anywhere for the businesses offering is UCaaS the work in Our the new our need

costs, While after for Crexendo that and in made our the and acquisition-related quarters, produce for teams. growth our the income investments with nearly VIP support we first new for offering the X time sales due to not consecutive did additional our in GAAP expected $XXX,XXX our investments quarter combined

the in net to we income future our success. grow we NetSapiens of and show costs non-GAAP associated with our per growth $X.XX as business and are that a continues significant of improve. The our well or are $XXX,XXX investment acquisition to share continue managing Our

growth for aware, video the NetSapiens experienced in their users, fourth following so platform, largest NetSapiens our on a coming a committed that of tremendous with XX% managing a to as last revenue to raising with September. to and the through successful platform growth as are shortly U.S., end you according spur are acquisitions in in platform, to row. and we we committed Frost commitment million help adding along with only to Sullivan major on a & growth the up provider strong revenue from business, users over our on less we and those with XXXX, to lower weeks. The to platform total accretive strong offering year stream Not XXXX invest our to in growth uplifting UCaaS tool we utilizing as completed but recent We're that quarters plans. our we're and acquisition endeavor that funds solid spot also a that own in UCaaS successful margins We're with a has in to committed profitable help S-X provider July and in close end our we organically exchange merger have terrific that we propelled met report. tool listing in collaboration with to increasing our will be and opposed collaboration to them X.X that are acquiring UCaaS offerings, labeling current on a We're our that capabilities. white and a been will X and to committed As that NASDAQ. We're our acquisitions, funds in using were a

reviews Crexendo HD great have We started as have and the already tool early had marketing collaboration and new success.

working also team. NetSapiens are about the excited We extremely within

platform We customers. VIP offering, along our with who for strong are interactions love. The with and all platform with are partner computers Crexendo-branded the phones foundation and in will our mobile collaboration best for is offering that capabilities their core video their that ensuring text, resellers applications our customers, factoring phones partners warranties, cellphone will messaging desktop our with the chat, on and and and community and will for suite have concentration and our tool, UCaaS cellular be offering to industry options with Crexendo to our of lifetime with the tablets, phone committed an committed our the

the stages need personnel organizations, in integrate manage tremendous benefits get EBITDA the combined only help designing as will opportunity There's the the a and resources plans, which market are the recognize, stages. Until that finalized a afterwards, including already is to businesses are our company, and merger in growth X and there excited implementing and intensify. for to for experience of our As strong and UCaaS flow. the aforementioned and combined the our cash with industry and great will maintain the technology, and we still will strong reinvest continue merger planning We're grow work-from-anywhere will cost in combined we us healthy start that consummated, continue a along company organization. lot to with solutions

to to about be the We combination industry. I'm with of growth positioned our stand-alone even But performance Crexendo are our will be the as well it this significant force future. NetSapiens, take and advantage a excited reckoned about of excited with more in past a entity. and

We our shareholders, plans commitments organic and for months and gain and traction will only continue strategy to execute and growth our through continued on in for acquisitions years ahead. our growth more the

back for over our as share, in the for well, with are we in here shareholders. And market the will to increase Steve extremely only comments. to international opportunity our markets U.S., not I any the untapped additional to but that, nicely positioned it deliver With turn previously

Steven Mihaylo

wonderful no to we're up Doug. open comments you except That echo what a if heard have additional I going for to it have you, any. so you've was far. Catherine, Thank questions, report.

Operator

coming [Operator first question Nichols. Instructions] Josh Your is from

Josh Nichols

little great in on the just is line, of merger case in vote. elaborate -- you planning hear point this majority that already a the think just you bit Could I merger are all nearest what to time the terms stages? cross-selling... integration the closed shareholder And post opportunities the you're of with in do the but at

Steven Mihaylo

let want Doug do to comments. going that. I'm of a But to couple handle I make

for and I'm rules he's we working deal accounting First the fill for months for going blanks couple you. the new folks the preparing over and the and SEC that merger and Jon But we've of work to turn and for to of integration up to XX have the is this. With it ago. going had against. probably all, Part the us the we that and to Brinton months, last and been of team Doug doing Doug, Gaylor were me been this it on with entire bureaucracy that, in matter, had

Doug Gaylor

Josh, Thanks, and you. Yes. Great. good to talking

obviously, So well discussions already integration underway. yes, are the

of both meetings, And departmental Monday the that of have anticipate planning it's get on So we to everything Ron Is. between by month. From this next dotting just our consistently. planning of matter sessions, Ts organizations point, on earlier, X as week, a the we growing it's And crossing approved. that and hopefully, formally we'll strategies and mentioned anticipate working then shareholder meeting everything the end synergies closed, really the the organizations

So grow UCaaS in that side our last XX%, the continue being last able quarter mentioned, sides NetSapiens the on as XX% with I and in growth to of the the XX% both equation. anticipate year, we to

we're about excited is management So well. together. as excited NetSapiens extremely extremely putting team organizations The the

perfect And said so match it's, fit a for just Steve and a organizations. perfect earlier, as both

Steven Mihaylo

answer Does your question, Josh? Thank that you, Doug.

Josh Nichols

the any been you're side? curious business Yes, as also about commentary communications And or on I'm as then anything it see did. just seeing that to trends business a the Has backlog, then seeing spend. that follow-up, you're post-COVID? in growth And improving

Steven Mihaylo

one. I'm going to let Doug handle that

Doug Gaylor

Yes.

office. to little has platforms. to think the spurring need are coming for pandemic our a communication whole little in seeing strange fact reinvest a they a were in we forward. that the that on So realizing been hesitant back businesses for businesses to then them a That's move in and had XX while last I months that the The

But sales I and So think tools. offices today communication and and in back, we've more ebb businesses reopening their coming flow little seeing there. of the seen more traction kind a we're needing

offerings but be work-from-home prepandemic to the So little it's shrink work above think well from going It today's our home continue need tools change. to I bring a is collaboration not more the the for that environment to become may to to environments we with that prominent only going bit, going society. UCaaS and more table what and business where. the in are the And

up year-over-year. So that being said, our was backlog

We going got collaboration the VIP the there interest platform for platforms. continue We've from and to strong that's rolling new see and of lot our new with our in out out tool. demand be capabilities a some products partners our our to of

excited So the on and extremely future. extremely, I'm extremely bullish

Operator

Your next is Trebnick. Catharine from coming question

Catharine Trebnick

also. acquisition the in sprint Nice Congratulations.

Steven Mihaylo

the future. excited obviously about We're very

Catharine Trebnick

got tools we And -- up. acquisition. up? marketing for OpEx marketing about Definitely. I with sales and Did programs obviously, procure question any Doug, that marketing, run in had for was trended think G&A the marketing new that specific how any But of up a you you. rest trended year? the should the

Doug Gaylor

Yes, great question.

obviously more platform. that bit new Revenue really channel rollout. the yes, in lot Officer, we're Crexendo had We've on let because reinvesting VIP the obviously, marketing color additional spearheading Jon our So of and a in pitch new Brinton, hired sales. putting a a VIP additional Chief We've little add marketing building he's salespeople, initiatives. I'll managers,

did marketing keep we channel keep we sales some up well expenses so the there as out And exciting, and obviously for to sales have partner some And incentives as that. queue additional additional we put exciting.

Jon Brinton

have to to in, get at our to able presented that physically months what the called just has morning appointment and great VIP last the of does to longer in that just investments a if good price been or it the expand, over us the new is collateral material selling partners Catherine, talk and gets got partner the released, solutions, that able Yes. launch and with be up over rep couple important we MasterStream. And platform for marketing deploying to to that especially we've of to term, electronically as a all that XX can and "contract program an think, look in SaaS log tool" a out that a customer. who's reach to this our you. X are o'clock. we we community did I tools a propose gives have invest the we've basically, be channel have is A They made of sales the and

preparation some launch that Being the thrilled great made present we meetings NetSapiens the some are be into one sales not with I about We marketing the it question VIP and permanently, the it's room. the the I'm our that's to platform. things environment. And is is improvements does area of processes how that's those technology. mean, at just we've able workplace. to change not the of in from kind of people in about it's and that one the that acquisition, that other remove More will more friction area just us -- that had So the with meetings just have we that -- do for

So customers more be back requirement through people may and an environment. And technology there's who Crexendo VIP this it really us to preparing the this drive and while bring the in have positioned of it together, we platform. and have to dialogue it there the that are platform changes the We've because we still that are investments launch, getting to immersive our prospects acquisition, we've as and with not we're made with that within for Crexendo. continue in partners think some for we're going that can

Operator

Charles Your Ronson. next from is question coming

Chuck Ronson

to and team Steve, your new best as you your team and congratulations well.

really that there was actually looking say just in from at aside lines better, addition trade just before. significant to -- to revenues have great. your acquisition, I in continued quarter This And a have the doing

So...

Steven Mihaylo

Yes.

the the just got math, that, is of place I'd of going the if year. last like hopefully, add low or And we've things mark. ahead what XX% do is XX% in already be One to to you

Chuck Ronson

got I trouble And had of together. math dynamic look, pro a haven't static. be minutes been formas, really they're the before do The call wouldn't I great. I the with a formas, with we've to here dealing at the pro yet. began. the But couple But X time surprised. organizations it's X organizations. look bit I'm the

to going making you're to be you have do. realized which I investments, obviously, Now

to would you of you how trying so, much out do from put saying a can just sort together? from And think to static to the capable you're not Just put what thing, right many how spot. -- you actually the X care cut I'm now? having sort companies extent of you -- the of historic on a projections expenses by

Steven Mihaylo

if But be departments. X out thing, many. There's going may not don't only think data We're that. to too now, right X accounting we centers, projections. multiple We about to going eventually. do you this have put and any there's one There's

probably time, over XX So be that will take it's but XX months. to going eliminated to

be to growing future. understand are You to the sales every that have into single our going day

optimize just penny either synergies. And our course, centers line. the lockstep. sure and them. to make folks into to to in are going we're few at much a folks of pretty to end jagged We to and going and that, I be more are net on NetSapiens in hearing, we'll that based every a more a players. and So look grow And those It aligned add just improvement. the of is say that year, to Doug? Crexendo more isn't it see single training or to data we each you're be A to and Those more you expect more spend anything result on watch to what but We're we'll going culture is may and line, all want more going DNA. all stair-step would upward. Do of the be Crexendo, our win, or straight and that's like And a the I'm of the by going other. this and money with onward

Doug Gaylor

those both extremely organizations, look run. well combining at are No, they've comments, when think great I we the Again, Steve. been X

maybe so excited and and we are seeing opportunities to there's applications those they're costs, cut running. where running And dual we're applications that software and about like areas

So top opportunity. sure importantly, there's equation reinvesting it's both to that growing so be make line. the on we'll But bit the and of definitely we're upside top growing the revenue, some sides most line

Operator

is [ Finaldi Your next question Damon from coming ].

Unknown Analyst

for is and question the -- for probably Jon is message This Damon. It's Theresa.

Steven Mihaylo

[indiscernible]

Unknown Analyst

national combating plans And spiffs... that market guys lot our are to your spiff looking a are share of handle what increased buy through to How more yourselves? amounts. seen competitors I've you

Steven Mihaylo

the is only of Well, this. This this world. Even leaders have one the in comment X% the largest just let on of market. me the about business in markets

into tomorrow, for I'm bit growth just room platform. platform or than bunch more. this it for of players we're to just in to are merger, more it's grow first a have going the organically I'm we that's better A class. But former we've understand decades. the there's one And have It's to done you and mergers a team. business, going us our I propel believe through to way forever. and a to it decades, about that, add that? think because a important and that's this the do is way But excited not way forward. It's Doug, our whole thrilled going to to for than going going strategy. it life. with we're And slightly of This not but today to I do does little you anything we added want and the

Doug Gaylor

little add have just Yes, as color a I'll then And well. little bit. a Jon

obviously obviously We there. businesses, earn sure offering. are that that to so always we're competitive we've out want always users' out spiffs something have there something been making that's end and So a got

the buy to there at and all something it's prepared cost. not we're out So go business that

at to look are money. competitors you that and if continue think that I bleed they our doing

So the of few last in just massive results some competitors continue our show losses. of days, to the

go prudently, that? some to we're color earn you we're more want going do so going to And business. Jon, the to add there and and do to it out

Jon Brinton

do and that the really us. opportunity of for this say, things business I'll will I have believe broadest NetSapiens channel Thanks about just the partners able to potential for the with question, Yes. to is, And Crexendo be combined Damon. with one merger,

selling at they also now then as opportunity their model an do interact people our with model, the software with the look -- service an for to it of they what building platform, and you and model selling where where the the host NetSapiens agent. give actually we us in then providers; If SNAPaccel

of a there's play better and have there. we agents incentives of deny portfolio some that while. I in the for of commercial the that offerings don't level a to are whole out pay certain So across story a

You like reliability doing and always of at the business things look things of that nature. ease

for a agent able our in friction of propose and MasterStream reason price process. of to earlier, chose tool takes SaaS lot that's why our community as our of Catherine's So be the the a question to It solutions. we part sales out to case,

platform, doing One maximum the the NetSapiens for on guarantee XXX% result of it which direct merger VIP the customers. we're is we a with for we're uptime of with deploying placed things is reliability that

no where we So we of areas get -- be additional and the market long-term We looking not at away and some value build are have slightly can that that the promotional. to add places from can say we the incentives have overall really relationships the the incentive benefits partners, be to but for match the now we're the in things not to to feeling market the because of trying see or of right pressure program. some you largest of

Operator

Our is next question Saul. coming from Ronald

Unknown Analyst

Maybe this is for question Ron.

the On it of $XXX,XXX there the statement, SG&A in were merger. business the said we statement, But income flow acquisition shows million. a to cash related of $X.XXX

Ron Vincent

Yes.

So those are separate transactions.

we that the directly business significant So a business. that $X.X to quarter the was acquisition to million related related acquisition during on to the completed statement is small cash flow costs not

wasn't out it specifically. called So

Unknown Analyst

to one Jolla. in I And more to question. be Okay. from mean, going Arizona? assume moving? I maybe people moving structure their NetSapiens keep Will of Will present Anand La most be the they're

Steven Mihaylo

answer I'm one. going this to

what we sell. that's and company, virtual a are We

You it, we able internally. and won't don't be it we'll but probably right to use now, it see use

me everything that conferencing the happens same course, the they're together to of them are more to people Whether is of our that's other. It add business, than if those not in, than welcome each work current decide. And move, decide. with be I Buch move to room business, don't to just their communication better moves we But he not, UCaaS to Phoenix Whether That's to we're with for with and move that's there. or you want of for like or it's him necessary. in decide. if Anand the not really for has here in area. that, any All as leaders video able relatives virtual to. Did out anything would we'll to they think that? want the that

Doug Gaylor

it's just Jolla in to little Phoenix. a Diego meetings San to over can XXX-degree looking in to forward Phoenix, because so days I I'm La in just in No. here drive the warm go business

Steven Mihaylo

of Yes. Most the knowledge get in people time. summer out

Doug Gaylor

Any follow-ups, Ron?

Unknown Analyst

Thank you. good. I'm No,

Steven Mihaylo

Thank you.

Operator

from is next Edward Your Gilmore. question coming

Unknown Analyst

and I quarter gross getting the wondering on the the and this line merger VIP HD and sales. finish Crexendo the bit was had couple expected just on margins Congrats a on if little pricing of to maybe quick I for a solution comment solutions. could questions here. you

Steven Mihaylo

Well, to on one this I'm guys jump of one. going in let

Doug Gaylor

anticipate I with margins. NetSapiens. own we'll Yes. strong mean, obviously, platform I with the that we the would think gross merger

and platform, margins it own because So always hardware the our current platform. little But margins been been continue lower platform always have The aspect that having have margins own Crexendo we've is we got strong. strong our today combined, margins. a with to gross bit strong of

anticipate continuing And VIP the to side margins. equation we as strong their on a of Crexendo strong the So be platform margin runs well. NetSapiens

So anticipate that designed sides the forward was NetSapiens, HD and on of both and offering going equation. The the technology Crexendo developed collaboration margins strong by from NetSapiens the again, in-house team. we is

margins So well more there. there we obviously, as as see tremendous to demand there's continue more and

the fact competitive and marketplace. able margins being and better going have extremely roll So it again, extremely there out being technology, technology the with in excited more that to we're that and we're strong about to technology, out

Steven Mihaylo

X% eventually over looked of at the things get to mode. a by I out way, million revenue, we're XX%, up But the I would X%, building carefully. now, margins Right And are $XXX and creep XX%. top expect maybe we in margins that once our at one very about in

little a that. out lower go the higher service actually margins we requires offer and that, can there bit our like they best customers a bit to do that in order think but little than to I

Unknown Analyst

solution the that? of or all to going may able guess, just or to And the or, many follow-up yet have I month you you Okay. then question. per solution to sense onboard customers HD quarter however a how NetSapiens you're Do be a model

Doug Gaylor

Yes.

So again, the X there. sides equation of

So if new on at selling you NetSapiens look brought NetSapiens, platform about last year. their just XX partners

onboarding a to So us more from That's be customers that our a going growing numbers to higher Crexendo platform. the VIP That's the part continue parcel like continuing obviously, from and and and to to June the taking those so platform a XXXX. off from HD about SNAP.HD, anticipate a offering platform. onto anticipate in perspective. and be our going talk onboarding on maybe customers, obviously and you we that's and When tool, in VIP then collaboration more sales, even start anticipate we rocket. And numbers we

inclusive one licenses video licenses, So of application. will of and we'll be the have the different

we lot as of see HD a Crexendo will we'll that So licenses for tool built it. adoption anticipate, the into have elaboration

Operator

[ Your Greyson ]. Hillman from last is question coming

Unknown Analyst

they says documents is interested just Greg few And sale. one, a or potential merger. in could in This a you a I Hillman. reading Why of for potential number NetSapiens as was the it was interested ascertain? sale, were merger merger or that the

Doug Gaylor

Yes.

when that obviously you think at component a look I both for both organizations. growth was organizations, major

in talking lot onboard, this market, it and people grow be looking been talent a being NetSapiens So industry, growth, been go an to to for some Obviously, it's private, raise same And profitability. able the and a the NetSapiens, Greg, is quite to be growth. markets to to public we've luxury the to able we access out so right is time competitive. the Crexendo in that and that, looking extremely for takes raise to has capital. probably endeavor. industry you capital. obviously to and get expensive know being to that grab And this for the get public, right had didn't that and because competitive have it's very And

grow, to to the to So we find good had NetSapiens And for for them was grow. had a find they to to be able right us continue to looking partner. And partner. grow, to

in Steve so no to it as pun cloud, earlier, is heaven really a So in or unintended. the intended -- made speak, actually or pun marriage of said kind

time industry, ripe the this quite M&A competitive. for think industry has with it organizations, the of we so when telecom been X about some combination because So is

And Crexendo so for perfect to to that grow, us. their to perfect grow partner a for a for NetSapiens want partner, platform, them. and And continue Crexendo they the needed the we fit way to was NetSapiens for was grow

Okay.

Unknown Analyst

education. verticals in of major and going center also they've up new been offerings net areas for that savings the Are service they a some before? verticals there signed in that -- Kaplan some haven't you, as contact you I after new Okay. And to University. noticed included and

Doug Gaylor

Yes.

So good question.

has a we've service. think got on talked always and there you side the the fact most about phone when about business So that verticals, out every need UCaaS our them system, of

whether platforms, we And user office, perspective verticals. NetSapiens it's a so end all doctor's to a very a whether it's an different selling dealership, providers, school, sell to it's whether UCaaS car from to they Crexendo. sell similar

system that not a unique actually use, really, NetSapiens the a begun fact and opportunity further. it's just all and the opportunities many UCaaS a different proposition a of for is a that that enterprises. one reseller for types explore providers that to a have internal which they're to that also will to but NetSapiens NetSapiens really and platform, the platform probably purchased us very, very is unique sells own for actually out That's but good is -- starting they that has their the of obviously large So there. Kaplan in to aspect platform, verticals

XXXX infrastructure, the of lot companies So Fortune makes Fortune a their sense. whole if you about own type buying think huge XXX, that platform have

that's off option And version. own going pursued definitely be a their allow so have from definitely table. that's large platform enterprises an vertical to That's them could that not after the to

Unknown Analyst

Okay. that service, a offering as And contact Crexendo sell did then center already?

Doug Gaylor

Yes.

built applications center contact into their have organizations both So platform.

a Crexendo contact So center solution, did as had NetSapiens.

both the to the both is got me a mousetrap. combining build equation we've so And exciting talents organizations, of sides of the again, best the better for and the engineering part that on taking X platforms

it's get so better only here. from going to And

being were and that able that offerings had of focus better had offerings, they're the both only platforms and going with continue get to technology. cross-migrate great So to organizations to both

on organization. be was a one with the we're from we'll the NetSapiens, whether of -- of side or fill it able weakness maybe side to the the other there's Crexendo that void So strength equation,

Steven Mihaylo

one And very platform. have add, Yes. one thing expensive very, more than I'd like is to it's Greg, to

will But people. We XX bottom things, the line to it, from platform you be name and in of now, to months kinds margins, will one XX expenses, able about optimize all we have growing. is we're

going Ron win. thinks living matter out, this and And organization. out, mean, more that. We're of optimize we win. case same Doug organization grow cutting that the organizations, Brinton of don't become efficient. And question person then X And expenses and in It's going I we're -- once more not just if. a way: to time. a out that So need a after growing, everybody not a to pointed we're we're have. never we of as to breathing, or every want think It's and you the Jon we I pointed going It's to

their So head everyone shaking yes. is and around up down, here

Unknown Analyst

other be the is -- like NetSapiens time a team, of on with? XXX% of he did involved is the or Steve, spent their see he lot founder, ventures to company does his he

Steven Mihaylo

No.

as of have think spending you're in spends time. time that. and morning, XXX% long XXX% this thinking you're a ventures shower don't take he the we a you when of I other you all Whether of about as bath about your care Crexendo, or

Doug Gaylor

team And that the focus, core I of I NetSapiens, XXX% our here XXX% it's the as at can their executive Greg, Crexendo. is team at focus say, executive mean, core that just on

between goals and same we and success. to same tremendous teams the do. breathe the about excited live, we a because dedication organization can't and growth the the they our have I And thing success commonalities the work ideals same more their and So ethic, die, be I of said, the this make as as

Unknown Analyst

I've but companies own of to Crexendo? Okay. what combined percentage going right got And don't I Doug, between the page yet to who's and think in NetSapiens document, the the

Doug Gaylor

can is breakdown merger a better I after Yes. on think give Ron Ron? complete, the there. percentages probably But

Ron Vincent

for Yes. stock the is common our shareholders outstanding I that their of of options. exchange A large portion will the find own outstanding the own believe will shares. common of XX% -- purchase the you'll NetSapiens shares entities the combined document or and the price stock options

the employees entity. combined be the and holders option the or employees majority all of will So

Unknown Analyst

that Is there entity the document? a the they combined owner, percentage what that shows have in Okay. table the somewhere,

Ron Vincent

In document, yes. the

Doug Gaylor

It's in the proxy, Greg.

not there it phone have. ownership is a that what I'm page beneficial So page you sure book is, that but in

Steven Mihaylo

have Yes. never the ownership. the Crexendo of and probably point because float. the diluted private we is the diluted better a our my have have. idea of Greg, company of diluted of have a lot was where percentage of you float things gigantic works My one We're and to to a competitors become out going is gigantic more shareholders. shares like or number to to a remember for That that

philosophy website. -- haven't I it If updated is my have today it XX ago. years, but I as the in you was read a same probably XX years

front bigger when lockup going we float But to one happens the to get a we the they're can't going and that, get of it and stock. shares guys get in And to our -- out that NetSapiens' you either as are just other the I'm constituency a the actually, thankfully, of to vendors. to of and provided me and exercise than be see naturally. XXX equal, website But options. house a you'll what a read more them expires. customers trade key equal happens we all want would of theory too provide the with. And those it. except little part sold have employees, employees, or have It is -- with -- period shareholders The here. for it's buy customers. And shareholders to all they I I think or they my you're do font's than consider that And And shares of And you're them there list our for. small. we so something. easier constituents: of X it importance: even pay sell dealing in offer number cashless vendors more I put they buy do they got and to You've shareholders #X a that

from benefits important this. thing everyone is, The

what the anytime And We a all it customers and all of will improve that's the I'm that's wealth to we is I life vendors X, of intend to want shareholders, share employees, business. and make people. And have down And nothing, dead. we soon. to happen. this people with. community have, that to that when of But in to happen We want probably I if everyone die get don't everyone's diluted

way been And make I've point shut our I'm shareholders #X. too up. are is that So going the laughing. wordy, is we're everyone so around the going sure table to But to

another have feel you question, to ask it. If free

Operator

We have this from the lines questions at no further time.

Steven Mihaylo

everyone, the before hour X you We look had. ever forward to of and July. And all just questions and hearing for and call, you, by we you we week All for make it the in X are thanks a about all sensitive we we've and us our or what from the on right. of exist. had our way, the today, Thank seeing analysts being we're most for folks be to to ran know or them, and trying our but to possible numbers shareholders release we've that

call and of conference competitors. our than rebut later get most their if their our having week them. they act the together a have X been conference we've they a or little after But we'll thing call So whole a day earlier,

you, and meantime, in thank for you next to quarter. And the to you. we work you. hard very, So all we're forward look very Thank seeing going of

Doug Gaylor

Appreciate everybody. it. you, Thank

Operator

ladies you, Thank conclude does event. and today's This gentlemen.

participation. your and have wonderful you a time, day. this at disconnect may for You Thank

Crexendo (CXDO) 11 May 212021 Q1 Earnings call transcript