FIVN - Earnings call transcript Q3 2024

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Operator

Thank you for joining us today. Certain statements made during the course of this conference call that are not historical facts including those regarding the future financial performance and cash position of the company, expected improvement in financial and related metrics, expected ARR from certain customers, our proposed acquisition of Acqueon, certain expected revenue mix shifts, customer growth, anticipated customer benefits from our solution including from AI, the extent of the anticipated TAM expansion and our ability to take advantage of any such expansion, company growth, enhancements to and development of our solution, market size and trends, our expectations regarding macroeconomic conditions company market position, initiatives and expectations, technology and product initiatives, including investment in R&D and other future events or results 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.

These statements are subject to substantial risks and uncertainties that could adversely affect Five9's future results and cause these forward-looking statements to be inaccurate, including the impact of adverse economic conditions including macroeconomic deterioration and uncertainty, including continuing inflation, increased interest rates, supply chain disruptions, decreased economic output and fluctuations in currency exchange rates, lower growth rates within our installed base of customers and the other risks discussed under the caption Risk Factors and elsewhere in Five9's annual and quarterly reports filed with the Securities and Exchange Commission.

In addition, management will make reference to non-GAAP financial measures during this call. past we X, please our financial and speaks found in GAAP currently in why information November regarding and guidance provided the of the this available of in section earlier and only investor can reconciliation versus our appendix of discussion of use that well deck management's measures non-GAAP XXXX, information Investor is be as on afternoon FiveX's longer our A as at issued that this as release non-GAAP call no note Relations the website to views at be investors.fiveX.com. Also, time the may on today, accurate replay. results

turn indicated, figures FiveX's unless a to non-GAAP. Burkland. the Chairman that and Lastly, CEO, to discussed call financial reminder Mike over And otherwise are like now I'd

Michael Burkland

Thanks, for Emily, this our afternoon. call and everyone, joining thanks,

quarter with across very pleased all We metrics. our key guidance are which third exceeded our results,

Adjusted accelerated XX% quarterly was flow revenue drive and record $XX XX%. operating year-over-year growth accelerated of revenue. helping XX% or million to XX% Importantly, of subscription to revenue, revenue EBITDA of cash total growth margin

is grew of base, in than million-plus reflected included installed year-over-year in the AI has by of often without where new AI last our leveraging were and seeing QX. enterprise the AI, average the XX% momentum of AI over turns the larger our XX% demonstrated making our XXX% When in AI QX. Furthermore, quickly this our AI deals. bookings meet of to This new ARR attached by of deals X transform energized quarters, clearly deals X with to their bookings the the momentum logo over is focus been with power AI logo I to customers, logo products up I'm over products. we're also discussion ARR CX over ACV Xx new AI that and

to some largest transform AI. is the AI their Our of solutions brands with FiveX suite of world's helping Genius CX

acceleration new of aware CX throughout imagine. customer changing journey, AI, could entire ways platform delivered right previously this eyes, and is This the before CX CX. AI-powered the is only value our many call we in stays the our With new that engaged and we delivering by

Our actions launching FiveX paradigm FiveX a digital, agents a with need for for next we're authenticate, next-generation knowledge, and IVA, agents voice completely brands. identify, which without and is called consumers across AI inject the independently week reason, drive how take both new apply intent, interacting engage human. AI

unprecedented to autonomy achieve of This interactions using customer FiveX volume to allows of human to need and also agents. experience reducing AI. AI to are comprehension, capability the engines that generative routed levels them designed deliver be great while

plus result customer AI new scores, improved empowered employees higher AI and for efficiency delivering agents happier With designed in human FiveX these is the to around CX agents, organizations satisfaction world. the

helping with largest trusted the FiveX is new brands world intelligent AI our in of the the some AI our platform our FiveX AI-powered Genius and experts. CX suite delivered CX,

AI our the where components own our AI their to work each customers X to experts develop foundation, we blueprint out rolled their Blueprint as our these recently With AI. using transform with CX program of unique

self-service increased the points of AI resolution franchises XX% one example, hotel implementing after for first contact largest program. by For world's loyalty our their applications

contact impressive to process. IVA used than to manufacturer, but with agent of Rather event. automobile our achieve from such traffic Another They ease, count, to influx massive comes resolution. with FiveX additional to global flex that leveraging first recall a XX% only is example handle the self-service AI not they the up traffic struggle handle attempting an the also their an

pricing test model, AI. we great and AI and our the of Also, CX feel in enthusiastic about are the improve effectiveness leadership continued AI, AI about our adoption with use to and have position I able opportunity customers AI our to remain ahead. With transform summary, for customers In large cases. the rates their AI market consumption-based ability power AI FiveX Genius program, with Blueprint our

Now e-commerce business best-in-class our service. a acquisition With in and we customer closed highlights. proactive acquisition elevate cases we CX for marketing, strategy and intelligent experience further marks use other omnichannel journey now August, of turning to outbound across inbound This by and our In strengthening customer to our milestone Acqueon. orchestration sales, Acqueon, significant offer platform. AI-powered

sales across e-mail capabilities and unlock social expanded adjacencies revenue particularly are digital, and to and SMS, designed streams, channels in Our recovery. revenue new

Epic the into with also expansion our strengthening is as CX of strategy and With I'm experience our our opportunity. our proposition as pleased to such has market value at expand excited innovation care about Ajay companies that over vertical of we product further expanding We're FiveX FiveX lead joined includes Chief This integration. product Awatramani of announce health Marketo years the track AI how Acqueon Product a Oracle, offerings. and proven Officer. will Ajay XX software driving FiveX's and record Adobe, as and

was recent Gartner launched CCaaS. we hosted our first We and Indian center experiences. the in have Quadrant and named Killer were Best Fortune a the new large FiveX technology opened ever received Magic Department a Work initiative vertical Telecommunications, targeting AI in #XX several certification health launched digital called other care. once from our and day. list We the new leader for highlights. again data In a category. FiveX AI named We Places of addition, India XXXX, to We in We our the series

XX% delivering want FiveX believe stronger remain optimistic momentum and In subscription FiveX we every purpose passion ever and We the than to ahead is also about durable in summary, thank employees long-term driving day. to who and growth revenue CX. in AI-powered our for pleased are all the opportunity range. I of bring our we with XX% success to

key of a and on as customers new other role external moving Dan on time. to for give taking facing evangelism wins, update. on you quick is our EVP to Before as us well customer wanted for X focused strategy, as partners I a Burkland go-to-market

report Andy to Dignan, will sales announced our recently Our of solely by organization, COO. led EVP our now Sales,

today us wins. customer joining to to is Andy about our you. talk QX Andy, over So

Andy Dignan

Mike, We sequentially bookings you, We had everyone. and key which improving Thank discuss forecast. in quarter solid coming with several our I'll and moment. ahead wins, had hello, of in a a

effort across As personnel market sales and care, coverage steps. of we of several and vertical in stated of segments the EVP including appointment key a new last quarter, and of health markets, and to hiring an execution, realignment our on to maximize took resources retail. each sales focus AI we services of These improve financial included

execution see healthy and I'm team, and pipeline. to in the energy encouraged the with by pleased focused the growth I'm

strategic investments partners also select ServiceNow. as We Salesforce, continue key partners, well partners to with make technology and Verint ISV like go-to-market strategic as including

As will I normally key we some examples share of do, for wins quarter. the

inform who omnichannel best mobile initial ability was global DTLs- the order to and rates for anticipate $X experiencing channels to carrier behaviors, on-premise were customer ARR its system using achieving over connection customer proactively intelligence campaigns along with services. desired offerings, The first including This a preferences. which acquired Acqueon. regarding and solution, example challenges result the of to device look not upgrade that ] an our proactive FiveX predictive times demographics million is historical FiveX. is best consumers [ determine significantly includes retention them on various customer rates. this from with wireless to we increase and other They upsell and We based to to in AI-powered They reach in each revenue execute to results.

premise-based of with solution, while manufacturer limited, global They a is trucking RFP including heavy chat, a they technology and example an chose to is second Front-ended which FiveX for voice, and IVA, very e-mail industries. equipment The using for solution. our Teams. been and after omnichannel Salesforce Microsoft a extensive CRM SMS integrating automotive, full process, have

their providing Verint million more In easy ARR anticipate with cloud from addition, this X.X FiveX. to services is over order of FiveX Verint result to to premise-based an in the We in them modern FiveX. solutions platform initial migration

limited with and for online chose interactions. solution The have several platform. flexibility is premier challenged inbound both third lending example FiveX been on-premises outbound a with an consumer reasons. very for They They

IVAs, First, chatbots it and them intelligent inbound flexibility with gave call routing.

suite which personalized services. throughout to AI more journey of are accurate present products, and the provide customer the Second,

of leverage finally, proactive Third, digital a outreach. applications consumption leading basis. solution, AI able convenience our And on these with enhanced the being voice to outbound combining

QM as deliver the improvements initial and has we and using powered care primary order The to And help FiveX. analytics. FiveX loan has ARR and our do, XXXX Suite and example its share provider to who normally customer its over to an FiveX. will VCC significant in since a for been use support ongoing I'll now anticipate systems Verint by We process WFM, in of $X WM million application of a FiveX has been extensively expanded to this customer borrowers. IVR, speech result health

now add organizations, more add-on these organizations ARR to $X approximately care With deliver new they will data As analytics FiveX their real-time be aggregate they and health from to expand million. view helping be effectively. valuable platforms and and dashboards normalize the just to from order, critical new FiveX and them several data run and operations ACS we this anticipate

now like through you it take I'd financials. Barry to And the turn to Barry? to over

Barry Zwarenstein

quarter. X% to record QX total QX the made of year-over-year several of subscription XX%, made up for XX% Andy. reasons. million. revenue. you, a growth than $XXX.X accelerated XX%, reaching less growth in of to revenue accelerated Acqueon Thank subscription third focus revenue revenue year-over-year up on revenue We nearly

the doing. in growth believe the we platform it's purchased. how accurate number most business increase as our specifically, First, a number More on subscription revenue as that well indicator of of products of a metric reflects the in customers is the our is

namely our elaborate Second, in And a X focused review not growth good momentum as PS, I because on indicators driving as the in past, moment, and business we telecom other mentioned either. will of usage the are the in in streams, not are by have we design.

higher metrics is strong revenue revenue pallet The is result of of gross provided CX by are our has growth those that meaningfully market subscription the that directly market-leading industry. of to platform. others metric comparable enterprise penetration Lastly, a with usage subscription in intelligent a further Third, PS than is and AI revenue margins continued subscription large our

QX particularly new the enterprise key turnups subscription strong backlog, revenue growth areas: First, in X was a logo The which reached record. from

subscription of XX%. who grew ARR revenue XX% approximately in $X Second, customers quarter million-plus third the represented

Third, AI part XX% XXX% Agent the which growth. quarter, revenue, due Assist, year-over-year which to year-over-year enjoyed grew in in

of the revenue usage XX% revenue in a as by other streams. digits. mix a subscription. single to X usage These market merger for year-over-year customers revenue Telecom shift made provide to to We percentage between driven in own revenue continue now margins. Turning positive be primarily up larger opting X QX usage and revenue, our declines this declining both trend from consistent with gross revenue low their to long-term to of telephony. growth corporate results X annual continuing see This in points mix the

remaining of Professional services up revenue. the made X%

We to professional take more expect as and XX% usage from level decline percent LTM revenue and to Enterprise from our we services combined enable continue partners of remain of around revenue. and over to made the this total the term revenue fees subscription up longer possibly on implementations. in

the Our in digits which again commercial business, basis. an represented grew on LTM XX% the remaining single

retention LTM Our sequentially remained at dollar-based flat rate XXX%.

usage were X costs, quarter mix and in percentage year-over-year scaling impact points margin year-over-year. fixed with subscription. semi-fixed revenue, X.X from The improvement the the increase was X.X the drivers and XX.X%, gross for shift biggest rough percentage sequentially up adjusted Third against points to and the

Third up by margin EBITDA the points points XX.X%, X.X improved was tight driven quarter and percentage year-over-year, adjusted gross control. and X.X expense percentage sequentially margin

as was with revenue percent ebbs and although with improvements, pleased percentage a was further flows. our points margin XX% Share are a compensation and Stock-based fully dilution basis. inevitable and year-over-year X% X on down of diluted We trajectory expect year-over-year.

was the loss the Our loss roof $X.X for onetime charge acquisition a the million Included of $X.X onetime benefit and a GAAP tax in was net million. million non-GAAP from $X.X Acqueon. net

Excluding been would better than items, have slightly breakeven. our onetime income GAAP net these

ebbs inevitable with further line bottom and our flows. expect pleased EPS are improvements, and though We the and with GAAP trajectory

was regards adjusted cash came in in strong cash revenue. to and per flow cash QX up XX generation days. quarter XX% we by LTM With to $XXX our QX, operating by $X.XX, from strong equivalent delivering was XXXX. which flow Third driven of at diluted million EPS This EBITDA DSO performance, non-GAAP $X.XX share, continued flow, of our

million. As operating an third record was aside, $XX flow quarter cash our a

as I'd guidance the now And as for XXXX regarding like discuss our XXXX. well provide of to high-level commentary remainder

for This guiding guidance For $X.XXX midpoint the XXXX, QX, prior of $X.XX seasonality. we million, midpoint billion raise to we QX billion. are our assumes guidance. to muted revenue to are implied of Accordingly, guidance ongoing our a $XXX.X a from revenue raising

for fourth is non-GAAP in $X.XX midpoint prior guidance, exceed expect EPS implied our margin EBITDA bottom the per share, fourth quarter raised we As a QX line, we to to are continue to to guiding which of also the diluted and XX% quarter.

For $X.XX to of the midpoint raising non-GAAP $X.XX share. per guidance our diluted are the year, we full from EPS

anticipate XXXX. would prudent therefore, will I commentary the and the if pattern potential XX% even second half muted be with like high-level revenue revenue that than macro are we billion the the of $X.XXX typical of XXXX We for some follow current consensus slightly upside next again time, our improve in conditions materially. expectation year. with seasonality thinking At with our to more provide Street being current now feel and on preliminary our comfortable this see for

will of the in margin terms full $X.XX expect diluted share consensus XXXX. street adjusted the we of in EPS, surpass we XXXX, In year full year increases EBITDA current for believe for the we per in and non-GAAP

In our addition, bottom I to line. would profile outlook an like on of the provide quarterly

look and of lowest to expect first in year the be the financials, the case at we quarter, is again our this the you non-GAAP XXXX. If typically amongst EPS historical in

non-GAAP anticipate the EPS share. be 'XX Therefore, XXs we diluted in to QX in per

well more share capital Please bottomline Relations estimates, especially enterprise to refer quarter fourth LTM immediately Investor as on and in second expenditures for and posted our the quarter. improve presentation the half, subscription website as expect taxes second We to in including revenue. the additional count, slightly in the

would Analyst concluding, that a long-term updating model Financial mention and to first be also the our Before I will half of like in hold year. we Day next

revenue day in a save We In durable will position XX% we in invest initiatives, in deliver to to long-term summary, for and believe AI a course. as us between we be out growth which subscription notification continue due sending XX%. CX, leader

cash also profitability and flow significant GAAP improved We opportunities progress towards time. see free for margin expansion, over

go ahead. please Operator,

Operator

[Operator Instructions].

will Hynes hear first with Canaccord. from We DJ

David Hynes

want guys Congrats on a from ask adopters about AI. to curious zoom the the quarter. functionality, for narrative others Nice your of those I of the environment. some what's let early results. AI I'll in bit on booking I'm Are trends space? the they an matures agent they Are go back today? working with AI content pulling counts? to adoption with get have? early to what sense on trying looking they Are seat they for as AI? deeper in Just little

Michael Burkland

and it today. before. to start really, customer comes in. AI expansion the But largest it about it's I'll and front in in experience, talked is DJ, the talked Andy Yes. helping really look, for enable chime AI Really AI. us center TAM some let We've we world. working of CX when We're their and well. about brands the

And it truly offering, really for labor understand it's that. see the companies we interactions, using we're or whether decision making our agent of many a other ROI around CCaaS TAM self-service. will. delivering Yes, and live they're the but an a are also automation terms and it's seeing out support, see that if opportunities, also to we're But software you customer arbitrage, expansion, We're human-assisted automation again, winner of justify or customers of using be the that and lot so providing AI-assisted. customers you are But enhance things big for will. opportunities or seeing their AI if AI they're to the agents and that do part adding if we're some additive AI for turns just not that to a in AI-driven number, human important

in beneficiary case. the a we're So

Andy Dignan

was terms obviously, our of of of the where I would Yes. growth. AI would got kind we in thing be, Mike. Thanks, gate yes, bookings IVA out add The only

Agent about growth. are our at launching, our AI to heard teams more talk us product Assist -- that's -- with You have just our bookings Genius certainly, And the delivering products fast sell. pace, a we innovation skewed engineering and

we're excited so And the there. uplift about

Operator

Wells with Fargo. to Michael Turrin on Moving

Michael Turrin

your growth prepared of XX% to XX%. the subscription you at long-term mentioned Mike, end remarks, of revenue

Is been -- But of environment. of underlying and quarter towards a this signaling can of a in through kind or wondering what gets assumption Just that in what we lower the of trough? of you as just target you seeing roll sort a normalized and us that you're lot the today versus that's changes end the more working appreciate, Your you forward? that range? are keeps through aspirational walk we've

Michael Burkland

sure do I I as finished drive in the key it's everybody Michael. to to last XX% up We attention you again, we mix. best because excited this -- revenue revenue long-term third -- They pays faster. quarter. And Yes, about subscription XX% XX% we're XX% the quarter. about of make very is not growth metric. XX% metric. in revenue close business. delivered said. to our just mean from that it's range it's want potential in our indicator of to growing the It's that It very really subscription

vast So us. purchasing platform majority coming revenue, from of more indicator more the to best is on and it's them customers and the for and our it our products

really So it's important stay subscription revenue focused number. on to

And very that fact as a sight after. AI this kind of in and we're again, other of in AI large going massive going has expanded distraction and bullish of well not our that remain with TAM, tailwind TAM the very opportunity. a a let's we're lose bit But market. which we things factor Yes, a this after been

about we're So the future. really excited just

Operator

with Meta Moving on to Stanley. Morgan Marshall

Meta Marshall

was see positive of just on ROI you immediate -- a terms with of to Maybe know quarter Great. seeing I are investments. needing -- there of some kind what kind last question for in me of

give demonstrate a or little so to that to that able an initial you been that ROI? easier of or have down get of bit quicker kind that see point that of kind kind entry step And people either makes to

customers I of noted kind completion those the kind on rates? on rates, any you're side, the but of virtual then completion you And kind know with some just changes just of seeing of and

Michael Burkland

I I'll fact in. start that figure out that, highest every priority. talk and some with But out of and of the about telling on learning it, a same Yes, lot And I as AI, it distraction their is are Again, We view factors forever. this It's to through to people learning quite at personally, curve there's distraction. a to think the my AI a feel of chime and companies And here go AI again, that again, the But time, is CIO is we And steep free is know that. AI. going Andy, think, real. transitory curve, comes a did planet, frankly, the right? the when

get in see Andy trend, I that And encouraged the Everybody a talked clip. make in CCaaS optimistic increase again, decision making. look, in decisions being I we going distraction, pretty by Again, through had doesn't macro past learning healthy AI at a a but we made bookings. of it. a here. sequential focused would quickly I on mean think say, to curve And one our we're terms And and is quarter about bookings. we're AI I what very healthy think decisions I'm about

Andy Dignan

thing are down this from very have our to and to to comes is lot to drives through of sales And the values, enterprises large it's what The a of to migrate lot implementations these highest the right? going lot ROI. of that all good I your of on-prem a is AI-centric AI thing And of a some have team to only to go cloud. is point, so the be, that very would doing multiyear things add we're enablement would times about a ROI approach

of the throughout end. get team front so some and to of also our adjust out having until implementation, that implementation that can the end kind we're sure things within is AI making without so on the value you And of that wait doing we the

value point, will continue between AI through enabling value so to kind together making much then deliver of to transitory really Mike's That of put and teams And we sort this sure this, to our issue. and our show the us time AI those ROIs to that faster customers. for again, help of get

Operator

Power next Baird. with Our come question Will will from

William Power

Okay. of head through start wonder saw headwinds into visibility the consumer this trend if what just into what kind of lines had QX about kind Great. update your thinking period. retail, latest as expectations And Barry, the us just baked holiday exposure with you into Maybe just of you, the QX of we there. are I you've are? you some guidance, and presumably season, what but kind could

Barry Zwarenstein

Absolutely.

the not the we in third only the more after card we banks originally and but slightly that is account than Bank year-over-year a we are credit pay are one So in they had big the is And respect from baked us, into verticals available, America. actually indeed many nominally, all to better deep and education, quarter, thought. we data sequential verticals, so environment of take is QX, showing Other guidance, and in we so if declines, even into debit saw overall into the look one which declines of for as except JPMorgan and inflation. take can this we

prudently that that we're time would see And QX account being. for so will the hockey year the not that stick planning At moment, years the time And we this in tell. when we've into taken earlier typically we guidance. set

William Power

really think been there, to drive know been a of feels adoption ratio. indicated of some what's in helping the small else AI opportunities, of and remarks. some that bit Maybe maybe numbers. is kind the could fit you I follow-up new I right? XX% this a of improvement one customer customers. the growth probably in the horizon changes? talk lot just I big customer to upsell like more, And think I prepared has up go-to-market I one what It on that's the in about of on AI if mean, a just And existing your bookings had Okay. comments base, you the

Andy Dignan

single and success nurture that is we've with So and Yes. AD organization. done, in it Thanks, role, basically, that AM into our QX, things of the it yes, role. the took hunter made ] that Paul. we CSM some customer think I up our split mentioned We [ changes we

the And our so customers, together trained plans. of lot And importantly, enable encouraging seeing aligning we're most SKUs, to directors, want we is of the here's objectives, putting buy focus value on about, This you hey, a account with what and them more account objectives. just company do are strong aligned signs customer's requirements what's the company our to think it of business I them. what teams and previously, very is the was really your

lot another take our that And of anecdotal road a ROI customers they is that love we're the they so a of at Mike feedback we And approach, map mentioned towards we've this just trying from for and that. of are Blueprint, solutions customers end to high they day, deliver and AI value products love business that alignment. the of what customized blueprint essentially a again, helping outcomes the the of have our and how the thing kind build advantage that's and -- drive launched

essentially, a changes. kicking But that just from of go-to-market good off. coming lot our So change

Operator

William the next Arjun Blair Bhatia question. with has

Arjun Bhatia

Congrats enterprise how is incremental that on driving from to would little what of the might that? about kind hear trend turnups think for now? you're revenue on a pipeline And else implementing? that QX. been you at talking I a the just love bit nice remarks in year look presentation Because that prepared as and your in quarter were you quarters the what then remainder maybe of think here. I in the heard, Can new I we've logo touch record a the what's in and I few

Michael Burkland

Yes.

continually turnups number logos gets yes, our important driving good more down So in backlog everybody But to to chime time time, guys. And I'll new record backlog, think growing free from we has of that been our I increased, backlog it's sign business, had feel right? for business. same start, over really in, and right? for more again, the future us, as that, That that's at and understand from growth but to a we a has the book

up over medium And predictable again, professional very with Andy, for has small what built his at and pleased and seeing. we're team the So large, a rate. a turning -- we're machine services they've years, customers,

see. to great it's So

Operator

Ryan Our come Barclays. will from next question MacWilliams with

Ryan MacWilliams

more One streamline just Mike. should Barry, next of it then we about how year? from for one is to that for then and seems for assist guide? like doing the And the Mike, revenue cases. more approach this in AI Acqueon And customer contribution like the Barry a working expansive XQ proactive fair like the from to outbound rest of like think alongside shift and agent terms a agents, to more use or potentially

do a that look how And or help to customers? guess, does your like how that can think really I So then existing FiveX? contract pricing from for you addition standpoint a value

Michael Burkland

Thanks, Ryan. agent, are well for next you as and crystal which DVA. that agents asking voice really thank talked right, to next want question, bot good just the A generation This be as a very AI digital generation age virtual Agent, and Virtual really is we've our is Intelligent right? and that, the I clear. it. of IVA DVA a so virtual essentially about DVA. of --

if not allows the you gets It's DVAs actually in just part will. into really fact to those the And being it in do cycle, the is So reason autonomous. assist be this the AI of the or self-service ability more and more. front-end to that And them it IVAs -- agent category. having

truly we of technology. can it with our just self-serve levels that amount the interactions So up

So about that's Barry. the it, easiest way to think

Barry Zwarenstein

that you QX. let with And With respect start for Ryan, to me thank -- question.

missed Acqueon, which in contributed of might said quarter, I people X% for prepared slightly August less than closed revenue some the reported have remarks, in the the As revenue. the it FiveX total

not the we've months, -- partners last, Why? it's with -- XXXX and the going on over QX XX giving because breakout to say, we to XX, really some respect big partners, With deals. are be explicit close into been Acqueon

Acqueon but on Bank The on essentially. For about for was is Big obviously our paper, talked QX this that Andy but example, quarter, also which the paper business. that on paper, deal deal joint our

to we FiveX a go to indigenous the a companies. error X say, over attributable here and "Well, portion And portion just It's to and fools error work. the is try so it's people. Acqueon And a this do turbulent that. co-mingling fools have to of is This

numbers the we're go since so material, down And that going path. anyway not not that are to

Operator

with hear we'll Tillman Terry now Truist. And from

Robert Dee

Great. are How certifications opportunity Dee on up receiving India Baby that center are This announcement? data unlocks the is for associated some opening for that to in the with I market. there? Terry. what And double-click all you wanted sizing important and operating the on

Andy Dignan

The couple exciting some No. for requirements customers time. building our presence. investment been India started megadeal in who Yes. of of quite with initial We've kind local outlet an really have for to our customers, that that of a large us. some had very

built started and we healthy leading this launched go that data to them. to to centers, so been building, building up a And center. the fill we've data start down up path pipeline

so asking time really into is have up in And then the customers how again, of lot this backlog fill to milestone. accelerate essentially with India. for it But opportunity obviously, And move do we important for the been around to us. for continue and go-to-market building quite current kind really, a center contact some goal again, that further. some resources of, There's

Barry Zwarenstein

mind. in, you if I'm And just going don't to jump

I'm think to I'm to where going you not go. So going go

already come. when a to one which and current India we've So burden But ameliorate with will very sitting year-over-year Bobby, I thing which in the we the there very mission to for because -- though, expenditures at margins, will gross with want on just of to meantime, revenue and bonus sequential a Andy a thing are as we improve, time, mention improvement. a look sure. shown over bear, it's is mentioned, nontrivial little nice it's

Operator

question. next the has Panigrahi Siti Mizuho,

Sitikantha Panigrahi

Great.

to yourself? what side. executive from right them First direct now there? into question want on product And within for from you these solution the of investments cases hire lot the the those see of Look, we new I'm base. FiveX where you ask the in versus is your use AI. about of do cells, course, hearing AI your And installed a and start-ups great do customer, the getting EVP AI, hires. a customer who all, what wondering, that AI How going of challenges differentiate on of AI, about after of some are are chief I experience momentum see question you and opportunity going some are you congratulations the you some start-ups talked official your going on

Michael Burkland

Yes. great question. No,

the sit suite, take we've products we at they're really that about when advantage right? you you platform. this look of If care that So to product the talked power so we're right? at delivering, take to the AI look platform, where before, of And AI is essentially, that Genius purpose-built new specifically

data to give end, with front that interaction full experience. all So data, normalize to merge up essentially, that the able essentially that have the personalized data and being

before provide basis. consumption engaged were integration, allow or that in. able to our we we talked purchased integrate. to they maybe We we to where Yes. them customer these that solution We're on times be as doing came right, a as already And about in voice monetize of existing also an seeing a We're solutions And instances. good those us. point are customers bake-offs if success that as there's definitely has essentially well having stream before, does again,

platform the And so Again, there want of day, all the the business platform, our out we the the cases in ultimately, about we're again, ours solutions and on integrate end. end focus that customer, to use wins that if to delivering right partners we But believe for outcome. if the there's at of

bit So we're seeing a both. little of

Operator

hear Piper Sandler. from now We'll with Jim Fish

Quinton Gabrielli

Maybe on a bit on little that Quinton last Jim Fish. for is piggybacking question. This

in about those more you bake-offs, of talked are seeing these point You some solutions. AI

and AI mix, against CRM increasingly the solutions is the it is more Or that predominantly and point against you're you're of CCaaS terms specifically? In vendors? competing for vendors still competing more it the

And you, and hit you expansion new underlying need material in how here? improvement NRR a the just from are look kind to you for you in to here? are XXXX, the between kind mix baking flat of as Or about Do thinking then quickly Barry, of we midpoint?

Michael Burkland

our good natively portfolio would more We our built the Yes, key base, obviously, portfolio. solutions, still customers about it's in against and their we in feel that how say point new competing of question. strongly put I especially together. our were competitors

flow been with great so relationship CRMs, obviously, majority large And lead them. it. for that's the of The us,

solutions talk investments point to against. going partners me down be and space their have win, it's they going the we're at on point, there. and ServiceNow to with competing heard But they're doubling continue You go-to-market that and mainly where this about to Salesforce, we're engineering

Barry Zwarenstein

And Quinton, I on. still say your light is

haven't yet. split commentary, rate, being. those see -- but given comments initial time as retention wouldn't just In X, the the changes between we not the contenders I the terms major dollar-based of in want the we we're and that over for

Operator

And will Jefferies. from Samana with our Samad come question next

Unknown Analyst

Barry, prior the maybe [ questions. on Billy Fitzsimmons of expanding on ] some Samad. for

constrained at factors deals the some one was change led large maybe call, quarter's be to the that time. CIOs During last cited citing that were budgets guidance the and stalled may of

there is since quarter? of there change last kind -- was First, any

through I know customers And how some commented in cited prelim also in of there but those progressed that third It last how maybe quarter us still of kind commentary of are that, you XXXX? most of deals deals reflected the quarter. on those conversations you is now walk still did close? the kind hold? second, on then particular can for Are

Barry Zwarenstein

this, to happy about So talk Billy.

a QX. of So that -- pushing shouldn't into QX. we quarter spite deals deals better had large a than QX did look, actually say in couple large medium, in we of very very large, was in I And

of QX October. into And that fairly is news pushed in and and closed early fact, good in were so X in deals actually those the QX -- October, out

of it, butter the our and to and dolphins Andy middle great middle have job I of -- always bell of as curve, kind the of call So the done -- the right, that flow. team on execute just a of and deal continuing bread the

And AI, going I of that's see, deals Dolphin. them, third ingredients. just more to $X forward pattern more of valued It's turned our If a to that classic they and a you of example valued sweet I kind fairly got tons our talked seeing deal. million Acqueon, and those is quickly. revenue the they're think, that there's they've spot, about, in right look at again, we're because, They look again, to right Andy they that the examples

Operator

come BofA. Michael will with from Funk question next Our

Michael Funk

Great. Thank you you I'd all for are more table for reworking per you finally, ask love to coming the on asking the for environment. pricing seeing question. more your Barry, seat for seeing get at when thoughts you've a you pricing? or then competitive customers talked competitors bidding a pressure, deal. lot hear about competitive and But the Are to macro environment. And down concessions the or price you're

Andy Dignan

Yes, take can one. ahead that Mike, and I go

yes, that we're competitors So of the essentially, main to of pressure, not -- either. seeing have not a continued seeing we've terms competitors. that in different we're pricing set It's

you the of And based. obviously, strong we've at perceive see AI terms pricing think applications up. to we're held building our when then seat I go we're that our look top, in on continuing MRR

a think, And that's thing, really competitive so main yes, from perspective. sort of the I

Barry Zwarenstein

move And it's These to ourselves. the me like quarter, just no add the more one we're side, AI give if benefit benefit mean slowly. massive selling higher to don't software. that, that there's I'd to again, Andy. mind, things more comes especially fourth price, changes. with able to the And the customer you'll very clearly, remember, and be in And denominator. the major and you Yes, we the a on I and that the on to numerator where see so

in upon price. this want are do not very the to But So but can believe it's we the center responsible never leadership, have They industry. based in. sort see I sold can so system not that I they people -- volunteer people thing. then of Do contact checkbook, across of a making AI are life. And and to road map still decision open that my not information course, that

Operator

have Catherine we from which with Rosenblatt. will time additional for Trebnick question, come And

Catharine Trebnick

of is questions I One the Verint. had

you're that on? progressing announced today. You $XX And million that have in for how and deal working announced spot? a play how does partnership is that to they with Verint X the RingCentral compared voice And what with

Michael Burkland

I've heard at Verint. is, a Verint us. for the partner Bodner, key from Dan question, CEO Great Catherine. Yes. they're already

We and just any and continue get again, think important you players, entire But think players. their year provider. together with with what lot -- for WEM be open they're I partner. Verint I partner to with to We of them about We're that. partnering do don't And does, them CCaaS we issue the business what if other of a more FiveX. think market just again. it's for business They their partnering their the we have won with #X partner of than

solution solution going And their That the at with they've RingCentral long, their partnered contact own Verint, with interest own. opportunity. center the for time. been expense of They're we end market market the Verint. market is time, be low partner replacing long over the with just CCaaS they're a UC and their -- in building And like to probably nice

Vlad frankly, I and to for at ] good leaders Verint, I the So Ring good again, all And quite [ good both Dan it's industry. us. both partners think and know they're

So it's all good.

Andy Dignan

you've cloud would thing only strong building with the a us We're launch And I would add heard executing. the Verint's integration pipeline be, portfolio. cloud-to-cloud there,

to continue ROI day, best of we'll so what's closely in around look they the end at teams the solution terms have of portfolio. the and And our we'll bot together with work customer AI opportunities And at cases. see where our the the their . for customers use

Operator

I'll today's to comments. session. back Well, Mike does that closing Q&A turn it for conclude and

Michael Burkland

industry. We're having XX% say and very our in XX% the about AI-powered and helping And to excited deliver also our to just about time I again the for growth to in thanks durable revenue to optimistic our want Kelsey. with so look drive range exciting momentum the us. Thanks, long customers we're the -- Yes. growth subscription the an with CX, it's joining forward opportunity we in run. success

So thanks us. joining again for

Five9 (FIVN) 7 Nov 242024 Q3 Earnings call transcript