FIVN - Earnings call transcript Q4 2021

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Lauren Sloane

Thank you for joining us today.

On the call are Rowan Trollope, CEO, Dan Burkland, President, and Barry Zwarenstein, CFO. Certain statements made during the course of this conference call that are not historical facts, including those regarding the future financial performance of the Company, industry trends, Company initiatives, and other future events are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are simply predictions, should not be unduly relied upon by investors. Actual events or results may differ materially, and the Company undertakes no obligation to update the information in such statements. impact to future and forward-looking Commission. discussed result be filed including Securities subject adversely that statements the under are pandemic with annual inaccurate, FiveX’s COVID-XX and Factors affect and the in the statements caption substantial other Exchange and uncertainties risks could to and Risk These the the elsewhere risks FiveX’s of and cause reports these quarterly

A discussion the like addition, CEO, reconciliation measures Rowan afternoon call website call. issued of In investor of FiveX FiveX’s non-GAAP our will during financial available available non-GAAP to over release investors.fiveX.com. to go to make of currently our in Relations versus regarding why Please this in deck now financial non-GAAP And turn of measures section well at as management reference the GAAP results information use is I’d appendix ahead. earlier in press we this as and Trollope. and the our Investor

Rowan Trollope

Thanks, out thanks pleased we XXXX. fourth this and that call to excellent report for afternoon. closed you Lauren, quarter joining all year for both I’m with results the and the our of

remains the As differentiated digital continued execute market especially the our team momentum driven question automation world-class offerings. by and like strong, has AI to you’ll as market well transition hear up and cloud our clockwork. to very transformation as There’s no

year-over-year up by fourth the Now one-time to XX% year against benefits. quarter grew million, $XXX was COVID quarter prior that raised revenue

adjusted number and professional report I’m in business EBITDA And growth, grew came continuing strength the of at our to where areas, million enterprise increase strong quarter cloud, a pleased very supports not services leader this high global including focus the only penetrated automation, balanced to year-over-year XXXX growth strong also model of XX% to do going up despite and XX%. our and driven investments in grew combination our revenue the drivers; comments growth three our revenue barely that fourth continuing by I’m XX% LTM but our subscription clearly public we of be year opportunity, to on margins. key a in AI $XXX on massive attractive market full For commitment continue business and to increased expansion. demonstrate These our of that year-over-year. Today of march results delivering and and a our that my

and automation. So let AI me begin with

of the as for intelligent by Our accounted virtual captured time or to XXXX, new IVA logos. the the At IVAs has approximately IVA enterprise XX% illustrated market’s attention tripled statistics. bookings In agent following year-over-year. usage same

center still labor. billion. context encouraging macro lead while factors it’s which very is inevitably days, automating step minute the of signs. widespread back talk incremental automation about that that ultimately, are And And TAM will for to early from the these believe we opportunity. are a estimated It’s but Now let’s $XX there and labor two

and and operating face a center to while realizing First, savings. that in and customer contact second, reached resulting the tasks automating increasing for making a high necessity works rates labor center for tangible our maturation and by labor has contact by acceptance experience. technology continuing customers automation efficiently ROI shortages turnover leaders repeatable customers it’s cost And improve

plan three along into rates focused IVA we customer for to laser that achieve vectors. our sell cross and further and our installed increasing base are We new on bookings

sound well complex entirely orchestration implement new conversational virtual makes increasingly the step FiveX which AI as is which as We continuing interface. The Studio new customers rate launched incredibly enabling platform them first is IVA’s recently such is voiceover, to helping as automations lifelike. allowing this And faster to our of more and get innovation. Seven technologies started up

to spending sales accelerate and market notably, Second, meaningfully expanding support dedicated team, we’re and be our customer IVA professional the go sales stepping our AI of we’ll and automation size Most momentum. our campaigns. up marketing services increasing to ramping up

we standalone providers. service We opportunities all. million a an CRM with non European center IVA on into Finally, with with third, hotel unified motion communications, increase selling contact focus IVA recognized $X.X booking had will this year our and success chain internationally standalone last morph also from contact entire didn’t contact FiveX full we this center. virtual bear RFPs into us. on And for opportunity in the is these a believe where mind sell for IVA at center opportunities And untapped large that the we occasion,

invest making scaled solution, a industry our continue the AI update leading offering total brief platform. While we AI investments. engagement here’s on in other IVA most our our AI to is And

adoption agent we across of double customer with to digits continue see the in deals various assist industry growing verticals. First,

strong so KPIs handle We expect customers realize adoption average first improvements resolution and on. as such continued call satisfaction, as in time, customer

coach script that soon verified checklists will agent real to improve offering, adherence it. next, then capabilities agent and We what be guided continue launching assist automatically time new do they do including to our on the through that agent to

and every us conversation technology Second customer This such as provides technology for architect. our we’re building no without center. investing own to call scale expertise, IVA enables agent we central just a AI and to machine and applications off assist models data a that assist AI a expertise. to the globally, managing needing help architect IVA hub AI or solution learning customers and contact code Conversation train business their of agent in provides

reduced, as a are has for a this the contact hired opportunity opening required these center. AI expensive traditionally, with learning consulting market and of are machine in lengthy Now experts that process contact larger costs But training up architect, arrangement. part dramatically conversation

sentiment use and analysis. Partners analytics, investing cloud assistance, in Stream, investing products biometrics, AI building on Voice AI and in our technologies our agent from real with to developer like are time like addition in ranging time things this on via platform products, is finally, groundbreaking with streaming to we’re customer training, own authentication API. a real Now platform cases speech which agent cloud also friendly coaching,

turn of FiveX can customers they choose use built third or own a our platform. when of from range our to Now on party products products, top

AI. that’s So

namely, turn quarter next me our up revenue. growth for driver, Enterprise accounted our let of market. LTM to Now fourth XX% march

We success growth tremendous and than rates. a the million simply meaningfully have part the since the XXXX customers of continue ago. of seeing he CAGR XX in with will ARR, inception, from in our are enterprise XXX and me and up his more quarter. fastest ended XX% Dan a with larger that the booking high year These end elaborate customers a delivered of we business the generating dollars upon higher a in in But meantime, especially strong let retention growing fourth moment mention that team in

that and builds our while the like as AI have strengths of channel success So automation reliability, our we and behind have driver upon emerged trust. latest that market

important the as and Let’s A all all may and that supporting and in start I making we’re as achieving we’re also and with can cloud allowed the out we’ve investments disciplines simply is us area. achieve well are reliability. leading be to impossible. allowed very operations globally. features And what seek in provider have The mature happier be tooling doing this But cloud velocity. through features in public Reliability, operational our and These offer system’s at don’t have industry uptime us non-negotiable. you customers matter automation. the these is made world. know, that our results down team the couldn’t operations if investments successfully our to build with

that proud Next, we extremely ISV of remains. still how systems integrators, solutions come area brokers, partners, potential and we’ve and channel I’m continue borrowers develop this in to our including technology service the providers, and far

Our be us strong continued with the a channel to differentiator for this bookings is in The market. in FiveX how to bookings increasing XXXX. loves XX% easy and continues channel with work growth year-over-year

marquee XX wins XX verticals. countries the building now wide AT&T small One AT&T across servicing momentum in partners from our well. successes over partnership indicating to through these this enterprises array a and customers as of include large customers over partnership. full sector sold, We are the have of range public is Agents reach of and

is on IVA FiveX recent Additionally, the IVA the the we based about talked of launch earlier. AT&T

to is helping CX relationship at campaign, contact premises with Take from to the a AT&T also Cloud strength, on strength their to latest continues customers them migrate look on from which CX-revolution.com. their the centers and Contact Center by pleased support we’re AT&T legacy Our FiveX. Revolution, focused grow to in powered

us outside industry implementations and of customer and the worldwide. where seeing Now finally, customers. built professional result even our and trust this we’ve are and to net the located. agents made We’ve investments allowing for most stronger And we’re and support. importantly, scores perhaps leading the significant years the most is growth services both and is to deliver fast XX And commit our higher US, of promoter support, up customer with and professional services sustained lightning over

some year-over-year and U.S. International fifth results. XX%. growth paying headquartered these XX% off outside in marked fourth made from exceeded the business grew revenue in in we’ve quarters The the statistics. expanding rate of where First, six investments international our are companies clearly the quarter the

year We public and will revenue an objective the and so are simply, channel focused on overall languages, more international of instances, business part a marketing, XXXX our Quite partnerships, exciting be on. XXXX. with more having continuing by growth be this achieving international more more headcount, cloud more mid-teens of

an strongly solidifying past on FiveX a conclusion, we’ve this and leader, in with ahead. So as while even greater opportunity progress executed market made significant all year, fronts

Before our Dan our to a President, the turning of over Burkland, I’d huge to employees give thanks across all it to like world.

without thank consistently let go you. of of it and over You’ve exceptionally. and turn possible the the With been None COVID. Dan, so difficulties Dan. to And despite you, that, worst ahead. this have me would delivered

Dan Burkland

Rowan. Thank you,

well to of set machine logo bookings the and we of mentioned, bookings And records new for also all our shattered go record of the examples million record number share to wins, not only As ARR. up market over in accelerate of million dollars like ARR. which to and for are continues pipeline in four I’d a a but north now these dollars market

all which of first largest with along FiveX WFO fortune distribution. our steering, and They in stores, to manufacturing one of call Citrix members for example support result order, company and Their in VDI FiveX. and chose is not operating workforce. ARR did million the to based as is US for and the for They IVR, IVA the XX traditional email, chat, January, brands million of health industry booked including experience. strategy, company insurance The order over digital self a early provide and customer XX delivering connectivity visual to along next a FiveX contact this for follow service Cisco to retailers XXXX worldwide. a initial leveraging IVA to their over vision desktop leading on in chose the global also example And remote with solution replace SMS, $X.X anticipate for nuance We in first The our were well enable dozens applications. their on they’re over voice retail various as future addition speech to with analytics. and centers based

performance We’re FiveX integration this We our over very providing deep result management force million with order and to and WFO to in dashboards. a FiveX. $X.X in solution, sales initial ARR anticipate

their contact the Oracle, is The our a agents borrowers, traditional CRM collections lending with are their both for in outbound. using a past They payments. department. for and consolidating individual centers all for single service also clients third They And and banking blended delivering for peer-to-peer Live outbound we Cisco chose desktop. a of one inbound platform example, homegrown system, it and and onto combination efforts and holistic a for two by for inbound Zendesk loan company collections were integrating Box single experience FiveX and

this ARR They’ve XXXX We email, processing house outsourcing US. status operations, for anticipate providing in also it be been them which result initial chat, million example will our The IVAs they experience, updates a nearly loan as for the the now giving For our are center orders, to omnichannel last borrowers rewards SMS, along restaurants place customer applications. convenience to for standard food for give making contact business, wasn’t their over email, voice to chain across chat, is the payments. check with in and FiveX. their easy experience. of use They a order They also on visibility $X.X deliver to CX leverage fast also possible exceptional from SMS process them using of on make inbound complete solution using for as FiveX access vision. will and an and including began to FAQs. to on choice customers interactions. control bring FiveX status to their the They to help omnichannel the They ability operation points, in have an chose and all IVAs deliver and with deliveries, customer entire our their check to

their CRM, to WFO suite FiveX. approximately and fully integrated million sales We this full to anticipate the initial order ARR are from with will We force provide in in variance. $X.X result

So as move you we’re enterprises automation our And it embracing market and Barry? up deliver to more solutions a is hand seeing our over customer can significant completely see, re-imagined and AI I Barry. accelerating now to and experience.

Barry Zwarenstein

Dan. you, Thank

presentation Before that reminded otherwise will financial Reconciliations appendix to going unless specifics website. indicated our I are non-GAAP in on of figures results GAAP non-GAAP. included into of our investor are discuss the

have that revenue growth earlier, as most As with saw from quarter we mentioned rate quarter we had year-over-year. been retained benefits highest This saying, us fourth excellent we we was pre-pandemic revenue ever. gives Rowan the XX% confidence Reportedly, even sequential sequential another COVID. growing have more of growth XX%,

made revenue, and revenue commercial represented LTM XX%. of terms of business In XX% composition, remaining up our the enterprise

on grew business LTM in commercial Our the an XXs basis.

commercial accounted of our for the for XX% fourth to Recurring on and up revenue the we other total X% in our expect focus professional our a of revenue grow market. was moving the quarter, several to We services. the years, in investments continue majority next comprised business teens the as

XX.X%, Our higher customers, was retention other a our retention Fourth approximately COVID rate Despite mix gross to larger by towards higher to database high XXX adjusted were higher retention of year-over-year. have and automation the of trend the we which margins fluctuations, XXX%. expect LTM inevitable and the a points especially ARPU ones, XXXX decrease XXXs demonstrated quarter rates from rate basis due enterprise offerings.

As investment significant. have professional services been invest has still we namely communicating, aggressively key ramp and a professional lesser increased been to extent, The we to continue in but two public to appreciable areas, services cloud.

plan starting year-over-year We to to second our of of and Let half accelerated at me XXXX illustrate of services first in discussing pattern headcount in PS growth. professional rate XX% we the before by half half. the it continue growth the plus XX% second the normalize over headcount in the XXXX to

EBITDA training America, deployments, support help approximately build been quarter next with globally, margin XXX the investing growing out to and increasing per to over increase India have and share adjusted public Western the of QX, below the year-over-year We million, new points EPS $XX.X larger diluted representing quickly. services year. certification more significantly enhancing COVID Europe, and new margin, partners Fourth margin. diluted an a Fourth QX, $X.XX XX.X% territories, With our basis number quarter were including entirely the instances to $X.XX including was assisted professional of cloud, other XXXX regards per customer non-GAAP line and to ramp are share. XXXX programs a in we Latin

be concurrency others a to to currency equivalent our that estimate to to that of XXX,XXX grew the a like full basis, that count our performance, seats turning unit seats to on we seat measure industry XX% the Before named our site. quarter Note fourth summon in XXX,XXX year-over-year. year I’d average report up for approximately

driven As fourth by now XXX the by leverage. share in income was at $X.XX $X.XX provide XXXX partially margin, record closer also only a on statement services quarter of and approximately a we full basis year-over-year XXXX adjusted metrics. that an decrease the annual for per a year XXXX by continuing the And XX.X%, revenue $XXX margin CAGR public EPS points non-GAAP XXXX year-over-year impacted look was and margins factors year-over-year. metric of gross was year-over-year the of XX.X%, gross diluted decrease cloud public basis million, key same up XXXX XX% increase a the reminder, investments investments points a per offset operating diluted professional was XXX professional cloud. share. namely EBITDA our ongoing services driven basis.

during internationally. pointing continue we turning I billing before scale my quarter we a guidance, and us like system new flow cash market highlights. on to as to flow move fourth to and allow out begin expand some by sheet Finally, up that balance to would cash to comments implemented the

we versus teens checked in flow our than all XX our result, demonstrated been normal currently DSO operating increase have to the to million normalize of even LTM margin had in DSO in The given the our would next Thus always term, expect we back this the We’ve days. flow months. normally years. X% high meaningfully $X.X NOLS our with past XXs quarter. XXs cash And of As today’s and guidance cash I’d were full expected later XXXX substantial three quarter. first in resuming if margins, which our operating invoicing cases the and the validated they ability to finish of longer normal invoices, low was typically for as the two the to cash at at than for operating out a went to the a is low flow expand weeks driving cadence remarks some to and individually EBITDA prepared higher like and days generate our low discussion been three DSOs. year normal for DSO

For million. to year-over-year the guiding we midpoint at grow full XX% year the XXXX, to revenue $XXX are at

FiveX For prudent some New that those revenue we Year guidance. you you for with start have following know each time, of been

Dan Last we and as larger are as years gains started win up customers consecutive we and step continue AI This the with Rowan XX%. realize to reflects the And six year For raised that growth. to from guidance it XX%. we and initiatives. and talked year, in guidance our it to automation we strength of larger business about raising the XX% of we year-over-year now

on would I level like to margins. guidance, comments EPS XXXX providing Before high make

decrease on not points our do we a to our leverage reach given investments move XXXX and gaining our we continue EBITDA approach growth We by differentiated a initiatives offering conditions. and opportunity such EBITDA by up by are balanced committed to fully year-over-year accelerating drive adjusted expand XXXX. target three market irresponsible margin be It massive plus as approximately term But adjusted and automation would capitalize to maintaining so to globally. longer gross and for to market us two adjusted expect margin to margin market, to both to percentage favorable XX%

last we $X.XX non-GAAP share confidence XXXX we midpoint $X.XX guiding for to complete during plan. operating a provided of our our share So above outlook underscoring per call, diluted EPS, our the in are diluted per earnings

in guiding which quarter, time the X% of are to a midpoint better revenue to we been ever the past For X% growth first a when sequential years. guided the we’ve to quarter-over-quarter have quarter growth year-over-year X% quarters. $XXX.X in compared first first XX%, at quarter lead rate three decreases is Also, the guiding pre-pandemic midpoint we to million, which than represents the the is the first highest to

in the headwind diluted come $X.XX of share that point per We first always the per EPS seasonal non-GAAP I’d midpoint, $X.XX diluted year share the at quarter the non-GAAP of to of reset. is a and the quarter first out revenue expect sequentially. because decline EPS to weakest at the like FICO

services however, to decision For somewhat earlier. the than larger this entirely especially year, quarter as professional the due hiring, to to accelerate first decline sequential are guiding of a I detailed in we normal

the would to the the like remainder Additionally, XXXX. bottom of color top provide lines for quarterly and profile more I on of both

past years, in we sequential expect quarter. with growth consistent in second not guidance revenue do For the

to fourth expect in in we again business. increase do sequentially typical the patterns, strongly revenue the in as following more is quarter our season and quarter third However, business

the modestly second improve the quarter. had headwinds transitory factors mentioned to in current to our public with quarter flow and have should operating in entitled time in services the line revenue out. final it This in success the their shape quarter IVA we quarter. guidance non-GAAP resulted on concerning the being $X.XX expect significantly and third has first one we of EPS our earn this diluted But I with inference the full shareholders in One first guidance the professional Given and margin more be two fourth quarter share. The gross per of comment. cash earlier, half curve,

be million, financing be $XX and the The operating reflected $X another in million cash approximately be making this will which reflected payment will will cash amount in will We flow flow. quarter. $XX of million be

pleased could our are a such Please we LTM Let me ahead. Operator, very share the estimates, relations key them focused posted including to make we and to long as performance We just count, continue we initiatives, like in payment. be website execute in an enterprise please quarter subscription our add fourth XXs, for taxes capital well sell strategic clockwork. growth to laser to on In to refer that presentation the remain happier targets. expenditures. with investor in additional go deserved driving odd investing continue summary, our term achieve

Operator

you. will Thank at MacWilliams go ahead. Instructions] from [Operator question Barclays. come Please Ryan Our first

Ryan MacWilliams

can get there out. Just on, trying it figure to we go. Communications the video we analysts,

of Barry, to guys, during good with kind potential numbers acquisition. your how Okay, so a outlining that I job really know forward of Day you some Investor released Zoom the guidance tandem proxy in the go were think at the did about

we kind between look can you’re maybe guide, from guidance was remind light the just guidance year, of gap and kind and about this Thanks. Investor and thinking proxy any how year then in of us, the for numbers this Day? if really of those delta about full that or thinking investors that at there change that As

Barry Zwarenstein

great. That’s

the the Day Analyst no So versus last of Financial Ryan, at XX. November let is me take change part essentially all which very of that first,

way of or we’ve making So in projection the a describe in the as a equal chance making it type XX:XX it, down $X.X XXXX, it. was terms we as million proxy, that not that of fairway explained,

prudent the even FiveX conclude a by guidance seasonal with with two which different for we and and philosophy the by start is unfold, well, something very upon $X.X way billion, that though that done that and said year revenue guiding growth would between compound as we’ve different the same throughout it. rate then based generally very we in Two, been XXXX XXs Ryan for the you’ll last approaches, the years, other we continually factors you materializing know for I’ll raise For outcomes. XXXX see saying and two we those always we of year which that many that have year, do But in a point imply believe of long a we well. durable our the billion, time $X.X growth. out it, the type consistently. XX% seldom that and annual not And we we’ve the we put those believe that have the often numbers what as

Rowan Trollope

add which And and it that proxy last thing one in look different we still at two I a just from to quarters, we both But answer, two tops is that in the came obviously, beating proxy just the quarters. approaches shared. guidance ultimately, down

I on philosophy. consistent it’s different be guidance we’re continue two our to think and approaches going So to

Operator

now on Moving JPMorgan. question at from a to Auty Sterling

Sterling Auty

guys. Hi Thanks. Yes.

if more steady sales some then out could kind the just further and should and initiatives pointed other in impact. gross R&D So I’ll you X% margin to targets? of gross how with in that how you of hit the the in and the of side nice should going that take about terms margin to some which that we X%, terms the of that we much EBITDA kind is ultimate gave when out build capabilities? other color begin towards marketing us margin, And come to extrapolate, climb of IVA and is margin versus think But bottom question, of you decline of

Barry Zwarenstein

question. Thank Great you.

will to primarily point of me Sterling. back in it part. the terms gross occur, gross And don’t to let percentage margin, that occur margin where answer hit you will two to if just In come mind three the like second area. I’d the

inflecting the terms and somewhere I though, In be margins. gross talk second to And it’ll the quarter want before probably trough, those do around of third about out.

revenue. points quarter, is, pricing We give fourth The concrete we you and and see that. exactly on up want calculation our obviously percentage thing do year And let a a separate can into we that of go is two be and first the depending over anybody the pressure. you the fourth a quarter due year seat me this year-over-year. by automation. that each that in you We to upon you’ll in discussion again, what year amount the give way, And about each count. percentage by important, And fair this is we to AI disabuse the can

So would had was than we’ve I but usage half telephony. pricing, and of more mind have bear the the in on bigger before than bigger, had in the had it of been bigger platform headwind, we the for for usage even past, been normal second subject that not because leave in materially the XXXX, increase some

BXB going areas these customers on investing? professional smart we are a that other have world more in, we leadership where to is past. such Professional quite We’re Now, because and is the platform, investing the said reason services, And team into that, into basis. on on in do, that call high has approach. got starting the to Rowan services, this, that you’re is We Sterling, as team significant single on breakeven confident what just SaaS we margins need we’re to re currently, so to that the digits. get quite the the is this partner don’t cloud. not public are breakeven, We’ve mega been there’s ramp, the to going qualifications require class. into for in you services get and they be and trying that and in they require companies services a were negative in establish many yourself transitory. we professional areas the we’ve more lot established of a we’re Brazil professional that expansion, and just Brazil, that the And geographic you’ve is of yourself can Once work, And pipeline. coming in initial like at investment is, about that before brought

architecture XXXX, already need we’re is we’ve data XXXX center in amount area geographically And a across cloud. world. investing more is revenue, have cost public architecture coming savings start but other these XX. Again, grows be pairs completed. We teens hybrid probably done there’s The to in the debate, matter and we a fair also of the going where of is once in in it’s in certainly that to a

I’ll doing we at for we’re thing long-term the the leave that. and So think right it

the long Auty. appreciate Sorry Sterling it. for Thank I answer. you. Q really -

Rowan Trollope

Thanks, Sterling.

Operator

now Moving from Hynes Canaccord. DJ at question a to on

DJ Hynes

Hi, and to give talking spent going lot guys, a you I’m Barry about of the one remarks. break. a for Rowan IVAs time prepared you,

how For your the of impact just to that or might plateau? IVAs get productivity that algorithms IVA, that some signals the be to can And requests there point, that have long-term? data better, number the just the customers of starts kind adopted I’m can the economics are some continues by that customers think increase that as suggests handled demand the like, to about you at trying bots

Rowan Trollope

Yes. beginning we’re the No at here. really,

I’ll you a they And the scratching company the is per IVA. the were really surface their able savings month of labor XXXk to on example drive give their just one based costs. space. costs, healthcare labor of in So this of implemented that that And in was

giving volume, more be And we keeps more to value because I about. be kind so data that the as that’s had we high going think they on of able low and get for to they’ll automation. But drive gift more them, implemented work the that talked learning,

data a of verticals. with example, early PS voyage tranche and as seen help replay by too in to industry learn these started it’s very businesses to approaches. sort because is the of our metrics those the the that, of believe going get and we of legacy just just across an now then to customers. able implementations had and a past able we’re see yet this that’s, to I set as companies more various more be own tools growth implementations initial we for getting so technology in DVRR these to And the be a But we’re And not those a way, of again, teams discovery, what the learn of much see as

with So to already big. we’re that’s just XXXk one when tends But it savings small, relative say as and month, significant quite too quotes, and already example. then start scare grow these are because per small, I

digit many, millions time I actually of of previously millions largest and the dollars had count, they by period of our double implementing a said over this. I’ve mentioned, think long would done save agent that dollars, by many customer math

is most and think the especially they’re very, going time. go seeing material, accounts, very over to up the in that which numbers, So where are the traction we’re larger we

DJ Hynes

given here. you Got stuff. rules breaking typically guide super maybe one. helpful. it’s I’m some Maybe know, it how kind quick but reacting, Barry, the of just the guidance And how the just just stocks laid I very But out conservatively. of you

I QX a last sequentially get my reported we the period? actually was can’t I on When find down time back think look I model. that. one. revenue you all

Barry Zwarenstein

can I way have any go question directed find fine is that that Very with to far very answer detail. DJ, you’d to back one. Yes.

DJ Hynes

Perfect.

thanks. Okay,

Operator

from on Moving Marshall now to a question Meta Morgan Stanley. at

Meta Marshall

what seeing Wondering come you, Thanks, just some that you’ve of and just on. Barry, the just And the there’s with financial if a quarter these pacing lumpiness upon should got Thanks. for brought quarter kind of guys. deals figure eight customers couple Dan, seven any on we impact those on quarters. maybe past Great. on you’re some maybe question of of of over for see of building that

Dan Burkland

just mega significant if Yes XXXX been XXXX address the number customers, ramp QX in addition those that we for the will, beginning thanks we’ve dollar to previous customers. around that in on-boarding and they’ll remarks double you to in just question. shattering in through into booked did brought in To most Meta. continue we talked the and about We’ve in prepared I alone. our brought quarter. QX we a ARR million the ever record And

Barry Zwarenstein

you Dan, that, on build matter just to could reference I if made DVRR. And because

in said, because to they ramping. As calculation be are We’ll terms see not Dan seasoned year the DVRR there the just need before. of yet they those quite,

that of the in DVRR the of is those the And in Those second to automation. ones also, to can XXXs. customers the It in they quiver customer, see big impact the at inception, bigger you’ll and a best expand. CAGR intuitive are bigger that mentioned high impact generally drivers will $X.X XX%. especially And More into So inevitably important as have into one season key, positive as can the calculation. and the and and AI are the growing a improvement DVRR the though, on one half invest when XXXX, be billion have a expansion more the DVRR they therefore, of in of in sense, is that start arrows the to key makes Rowan that the the XXXX ramping afford able this imperative And customers. therefore the bigger is they and really since the calculation.

the also on they stress fluctuations repeat will So future and I’ll the the expand believe clearly including will to that with while article can in DVRR that bottom we sure past that beneficial top all be line. there’s as of in this want the impacts But on in faith about, is been company, be very on the term. really few within near have an things the you in we there DVRR, the business, and

Meta Marshall

Thank you guys. Great.

Operator

up from Scott Needham, Berg. Next

Unidentified Analyst

Hey, Scott. is question. my guys, I on John for you taking appreciate this

is having Just to AI the on our curious what outselling and impact channel? and that bit ramp capabilities? of additional provide if little you automation a could partner continuing type partners up of color How of kind

Barry Zwarenstein

take that John. one. Thanks, I’ll Sure. Yes.

rapid brought the it Dignan, opened we folks, channels, five in. market if appetite alternatives premises were flashback And leaned product. getting are But effort. started the trying carry up we cylinders the or partners them recall, based carry you and they as all demanding really hitting to to didn’t the them Regarding They into that ago, seen Jake a leaning may Andy had cloud in came started and four Customers they expansion. to years running solutions. head have We to in almost really we’ve the you several they’ve up. until just Butterbaugh get with on and

XXXX refer in But actually projects say scale XX%, Rowan refer, big, migration over that the those business prepared that as equation XXXX, mind, digital channels across the large they’re the the for clients. And fact, big for to it I I transformation SIs. mentioned managing when In us think in not are keep the cloud remarks, year-over-year channels. in like was to

success of great and we deal see traction a so there And with them.

We’re also because buy seeing in internationally, markets our channels play a companies from entity. want a much local internationally, bigger known to role many

signed and it or up from well across technology established, And so and the look to as world. more the AT&Ts global the all service brokers, service to we’ve the local partners the the on more don’t And in, automation pain need. right answer and about you business beauty now us partnerships you providers, many hitting size, as then the are big automation bringing customer where about of grabbing accounts. at the cylinders, easy VARs, repetitive, solution point categories, your very so mundane a that the Rowan has all is five that providers that it, case into highly it’s hey, mentioned game a The we’ve low big entree we’re global either. to think And they they have when of Agents is mean, great at a the stages referral asset, to make I point AI a hanging because early those they’re want fruit. we’re the when them questions.

a to their customer, questions dealing with those empathy they of on keep offload the need and is and and human the they’re folks interaction. ones where this repetitive So trying agents their really labor and with mundane let to way focus dilemma and the that automation, employed

participate capitalize the is So that opportunity. on helping and channel actually us

Scott Berg

guys. Thanks Sure.

Operator

to on Jefferies. Samana Moving at Samad

Samad Samana

taking for my Thanks afternoon. question. good Hi,

of have I the then in contributing or already wanted into success more years? a question team same follow something about and on Barry, guidance standalone selling of unit? it you the out that’ll that what forward just That’s maybe in should all think is like on the that is embedded multi IVA we basis And small So but in the just a we I should part be guess existing XXXX think subject. about sales to sounds seen of standalone that how ask up on an what that a of terms the ramp

Rowan Trollope

a with Barry remember and Thanks the Samad. me did that leader who the kind take standalone But let day, part. the the back about that IVA this business we nice to of and They was us doing selling. contributor gentleman kind the of of that the this our be continues in growth. helped same start commercial with It’s to excited I’ll you team, if are let second actually out put, team.

seeing the really to possibly wrap, got But incredible can quadruple do to looking previous the you That’s results we’ve So as from I we them the I that reporting into for there. already. we’re mean, sales to look double XXXX, Dignan’s leadership organization Andy mean, obviously that. shared we’ve year. we’re or

team. very, there’s So on that very big expectations

rest not but the labor. by They the sort it’s selling. the big it’s I And IVA to by of our adopt helping focused technologies that’s haven’t they focused on into the fold these think are that just on companies. certainly of that into not not, AI, is of would also bring each standalone way, AI that also customers numbers. agent agreed team add and quadruple sort I And way, their assist. just IVA, for It’s of help we some optimize have customers the our

be about value their how customer then out look much figure and it’s spend helping of at same the customers So and that. improve kind time, to selling more at more And labor efficient experience. with

specialists of can good. that before other who companies on have Barry, they’re kinds part so the question. and so come done in for the bringing second far, you so And of maybe

Barry Zwarenstein

so much. Yes,

At the just just the we curve popularity are but and rate So has time, described, up, obviously, XX% that And as the and on sales the these etc. Rowan what encouraging the attach it are same new we are, early really is with team, signs, when around enterprise, bookings, is innings. we and it, the starts know the early energy gradient don’t very inflecting. know and

conservative approach. taken so a And we’ve

Samad Samana

for that. thank Great, you

Operator

question a from at now. take UBS Taylor We’ll McGinnis

Taylor McGinnis

question. for my much Yes. Hi. so Thanks taking

believe growth sequential it you go pre-pandemic So was was XX% for if normally in I and XX%, XQ growth if at range. sequentially the XX.X% around look I revenue, like back,

that in as of quarters? about about talk the look some seeing durable potential And to in demand ahead, we those the trends that of growth led think some just for we you performance? future you’re as sequential are what can So environment how

Barry Zwarenstein

customers The others. fourth many in But it contextually. a now good And a those very as the the Great. were not been Yes, just what of durable of the and you we and that’s enterprise some to those over always well. stronger important we And the now, things of XX% couple in day, that is is by exactly quarters as as years some X% fact XX% end the quarters we mirror, LTM the we’ve At that the two to for of forward and rolling enterprise and quarter over quarter. in season, helped higher rates of high have our things really revenue to with started further COVID of excluding in quarter similar big the X% prior growth quarter, right, different business a we respect over also pandemic encouraged the very our had at This peers. more of that’s should obviously, it’s XX.x% of are pre-pandemic ever growth well, it’s those slightly that higher the XX% fourth here seasons was quarter at seasonally rearview grew by had strongest number in than but ramping now out the of the the than benefit the compares. past the committed a pre growing a mega rates expect driver going at get the to fact vary, difficult put and with to future sequential the itself. level from to rates just XXs years sorts was in was well, look pandemic, in one as and we growth,

particular And of sequential the exact and so it data year. will gives depend us the on a confidence lot nonce

Taylor McGinnis

Great, much. so thank you

Operator

Sandler, Moving Fish on Piper now to James

James Fish

out seats congrats the your hearing next a amount up the the last comment grabs to few are on off Maybe in you, Hi of we’re years guys. Barry large actually working see in for Great specifically, of that’s quarter. competitors one going vertical here to of not heard XX,XXX. of been even about XX,XXX you an you your seat when and and vertical services talk get heard called financial historically kind initial

there of Now, I as deals Dan provides anything sits to But smiling don’t on opportunity? you stop from next underneath like quarters have given will now post now scale what few FiveX cloud, can I you some know, wins. making really kind infrastructure prevents going historically the us you’re Is well really some these you Titan guys investments competing deals, sounds on announce size while public exciting that from on for these prevent think up-market very guys seats. XX,XXX have these of participated those theory. after that And look, know unlimited south the in big

Rowan Trollope

that Yes. I’ll Nothing. take one. Thanks, Jim.

can we opportunity moving We confidently, absolutely on the comes that serve up. are every world. We in largest in know companies the

said, paying a And you got demand that now, be them. but services of around We’re that paid that. us a already. already is investments last our time thing for whether have up the Fencer, market as that’s to around And Dan seeing organization, go new doing are And Fencer market is smiling our we’ve other the All one when Frankie professional really industries, definitely made our really three time it’s or scale, around year-to-year. all we those over around good opportunity coverage, market at those that’s opening investments the the what’s off. public years at cloud, are will many model and off

tuned But stopping on front. there stay us. nothing that So is

Operator

a Tillman question to at on Moving from Terry Truist.

Terry Tillman

AT&T. lot Yes. to A one have And question. of to Thanks disciplined for taking I’ll maybe my I’ll question. my on keep But be answered. questions it been focus

ramp seasoning a variety sector. little mentioned deals XX think progress about Rowan to from impactful you how out that if of color bit all you there. curious relationships add verticals, stands maybe XXXX? good I’m that I Thank XXXX talked And you. could more you have as that public that think more just having just But versus And a relationship? and that Anything be I into you’ve now with how and continuing XXXX. about could a

Barry Zwarenstein

call commitment was meeting their where we’re was from held feel our very that the most very kickoff but leadership Dan, Vegas, shorter really team, free you’re that but QBR, clear. had executive Las absolutely. a actually, with positive and it in our at a meeting sales since shouldn’t I solid in still level recent Yes. to that nevertheless, person we we on QBR met that this, QBR, the a this ground it to with we one, add

a shared being is FiveX I just campaign it’s have think remarks that We have also IVA I Cloud but They they’re backed there. is going that their be IVA by to by my and using marketing Center. AT&T, IVA really they’ve now for prepared FiveX taken which Cxrevolution.com Contact the earlier driven the in adopted

in they’re So large deals small, across and you gone new the get a providers for the service this from something AT&T while I that like especially getting Cloud they as and just get FiveX are and not again to started. offer. have very organizations, take so that’s to spectrum it’s But ramped know, with large attention, really seeing the we’re all up to public

So we’re it’s it, XX many, across mentioned, mentioned we deals, seeing also happening many, the many we countries.

can as around even So see AT&T the that including work world various it’s part partners sure more And we to well, we’re all those as there. Because want of do to Ring integrated we to the upside the they out with actually as locations box seeing more get it. clean be of Central. And make they in agent as XX continue definitely background deals. more

see do to Dan, these anything? that all and investments want off you so And we are here. things they’ll And continue we’ll growth anticipate solid to pay continue. add

Dan Burkland

educated talk they of in than OEMing their who’s holds reason it past time and behind too. can everything what They AT&T do especially wildfire going. integrated validation. and last is products, mega had deals dollar mentioned. same roughly product, and That as you we successfully they And understand them catch ARR able double like Terry, million the once on done best the are to implement momentum mega those more But question get field like they to scenes. take want they Everyone do into Jim’s quarter we billing in we work starts, wants can it the were they more system. how got give and in going on sell provider other. validation the see just to Yes once spread a service fact, and true does to know so other. for large working They that to these each get They get that can can The deals have Sure. and is Rowan ton because with and get we’re imagine, in to any deals successfully. each there’s we

and than of having we in who highly turn wait so well And reference as says someone ever, ever doing north seats sales they’re could not seats say, and a does team. say to successfully, XX,XXX you’ve them and vendor years, that best validation XX,XXX more the relationship had if

value subscription. wants go spent at Is put and we achieve until really the it But get so now we’re the of and have And getting wasn’t hard. incremental automation, easier to nobody out really seeing came a more on opened can the opened larger first And and and to to opened, door what’s incremental to enterprise. kind than to well, whole as finger floodgates of really now it maintain cloud And they disrupt convenient. that they’ve years-and-years turning enterprises. hard knocking this was And it’s It they’re due the I’m from like, massive yes. AI up going linchpin and it to make their we’re to pay each with other this AI in and enterprises and whereas before real resounding were don’t really And servers. difference, real the working? I automation. That was they the other say we I large yes, what a aha value should true? that’s to their enterprise things is say, change have the

Terry Tillman

you. Great Thank insight.

Operator

Michael Fargo, Wells From Turrin.

Michael Turrin

impacts how as the supplementary and both with, driving areas with any you well? of Hey, towards price clearly, the product patterns? very model towards proceed on. some the that adoption the and about mentioned view Dan, field is earlier thanks Barry moving there, question. you are up bundling? in piloted can some you Where efforts the price the taking maybe of in talk You’re proceed for there the

Dan Burkland

you with beginning a easier, designed the of for four awesome and as And can up the making bundling imagine, for the list of at we you XXXX. with sellers. simpler channel, our And different skews looking around and did also Because at reduce Yes, the Michael. bundles there’s actually question, one a cumbersome. our the primarily because it and always level internal become like does they our got laundry were all but came built and can next bring the per if it to were risk you factors seat and We dollars that that people bundle to that jump the capabilities, want of into thing, opposite, of bundle. and lower it’s

some is there. get things may thing You’ll need what, want one that or used. you not or that guess But

so And bundle to the gets it people up into hyped area. highest next

very, a perspective. So training perspective, from it’s actually seat. helped us cost a And also per and from very simple from billing our made channels it it’s

So goodness bundle all side. on the

Michael Turrin

you. Thank

Operator

from now question VanVliet, BTIG. The Matt

Matt VanVliet

guys. Thanks the for taking question,

that you’re and services, Barry also have scaling. lots professional high we’re SI more guess projects and touch lot a lot to what of I on the to building partnerships. But a are details FiveX. And around component investments talked continuing the global So flip these out of gives hear side, been you’ve services, going

you think on that door to us versus % trying new so XX of those projects? the in FiveX demand is side of help the increase employees get about that do need where can Dan for the create plus flywheel Why maybe feel from? the coming so more recommendations you headcount And services to partners the for

Barry Zwarenstein

Thank their order of the a what what’s side, and is the dollar a what’s on placing them design large mega of more that’s the year in capable time to rollout resources, the coach deals, of it, that have keep great through that apply side have meetings had to mind, when we we from or and raising the there things Yes, resources, it’s and for lot we customer possible. on sometimes Matt, a you, sell need because internal one even participate a consulting those multimillion for the question. schedule, those in

the revenue a coming done work So door. with ton no of in there’s that’s

when that’s offset the it’s putting it. look because you see don’t hit yet So And at to in we’re cost. the the margin revenue we

you ahead the we’re projects schedule. at look sold, of we’ve when backlog moving of So

the moving move. We’re can customers fast as as

customer And side. on our not not so restriction on it’s a it’s it’s the a side,

we’re lines. so And along progressing those

to If by the skill learn and look best professional be set scores the mean, are if at our And we’ve that the I NPS off partnerships in world takes that, par far we and for at class, others. order quality built, time the to to none to industry. out look on push them by cost our we’re deliver that organization, to going services established get you channel. you the charts to in sacrifice just with compared it not from what

onboard level we where and to of quality want the happening. them resources enable helping able be we’re get and that’s it So to skilled their to keep

and augment us external see be picking are the It’s years RPS have taken We but to services component, take that pride does over several you’ll several sources. customers years or the quarters up partners great it over with next something we’ve and time. able that several in the perfecting

Rowan Trollope

it. landing, larger want we’re you the front. to But these the they the the begins that to help with at to be early clear additional partners just in the side, that going out process. see in gate, every get successful because is that once to services reiterate we in chance of larger partners to of Yes. said, absolutely And can next have wildly this especially on and forward. want with stuff right that add, of investment leverage happen trained, of that make been are them stages, these don’t effect customers all strategy deals And But have flywheel them. the that on learning, and we and they But train they’ve sure but it deal we we’re very that’s And strategy themselves these on those as one invest are leave an Dan sure the as DVRR our so and point. successful. they by we make to We that making to we will impacts it of we make and

want that. So that’s reiterate to fundamentally just

Dan Burkland

earlier, the prospective mentioned projects other of then communicated I reflection, the success to those as And of gets customers.

those it’s maintain of quality in in critical and that so we stages. And important that level very that high it’s

out and weren’t seen to want others we’ve and ready, partners to that I’ve in seen So created it too and early firsthand a the have pushed our space partner it impact don’t the negative that we experience.

Operator

And now from last we at William Stotler will question Matt take our Blair.

Matt Stotler

some kind you’re contexts move of still the color. seen love guess good being stacks. terms transformation buyer. if spending so, towards you the communication terms get business enterprise throughput I to internal procurement or Maybe taking we’d advocates line for no more in were that see business of digital of rationalizing Hi, lot centralized turning buyer? one more seeing you guys. There’s this you partners But that broader the a And obviously, how that decisions? historically, get been do drifting you’ve Is come, into Are to that guys, buyer of visibility? rationalization interpretations of like, question. or you up in wide as market, you’ve Thanks addressing, projects

Barry Zwarenstein

built LLB gives is we and consistent what a larger within where our motion an influence as that digitization the IT, tend is landing sales our see of initiatives internal but happens back those increasing at think in the whether largest companies, the to go the ultimately executives trend friends seen entire from together the move that to when I they’re what you there’s that. do towards champion, these really into especially and have we with the us Yes, conversation. that around LLB But enterprise, come there going room, ours we or buyers time and not market motion same on, been and more IT

a in line the generally enterprises. always, we these of absolutely enterprises IT not complex involved always we have. we team other they that. And that it’s so procurement, greatly and Frank LLB with are looking happen ability amazing by look, and single just the to is of and there’s larger spent to these whatever get that processes this the especially an of reasons up in deploy, one gets back ends, the let’s course, we at be buying getting using. teams Microsoft why, experience see traction sure lot table larger it PBX in a see make incredible do writing they And things business transfer centralized where And and seeing the the teams managing you’re has they with we so between that Because business if our they that mean they’re fit want do and of and it presence, larger a, get And are enterprise. time the in more in to folks, Dan’s influencer forth that hand product call want, checks that building these quite themselves, back But relationship. is at the the we’ve that’s that the teams, the empowered best to more glove customer at they that way,

been buyers dominates reason Microsoft for investing enterprise we’ve where in Microsoft strategic an absolutely that’s why think important, the so market. in particular, those And we just

Rowan Trollope

that an and got Okay, XXXX like forward business our incredible did everybody XXXX all joining in up. today call to question. thank We was for great in terrific lined XXXX, amazing look to an of your our last our I’d questions. and QX. We’ve for

fired are employees Our up.

Dan FiveX. the like ear so much. lot tuned that joining follow to more and Thank are stay you is up to we’ll all you for from ear Our customers happy. thank a for on calls. grinning you I’d see With very

Five9 (FIVN) 24 Feb 222021 Q4 Earnings call transcript