SPOK - Earnings call 3 2023 | Spok Holdings, Inc.

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Operator

Good morning, and welcome to Spok Holdings Third Quarter 2023 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Al Galgano.

You may begin.

Al Galgano

Hello, everyone, and welcome to Spok Holdings Third Quarter 2023 Earnings Call. Vince Inc. Executive by President Mike joined Spok of am Kelly, Officer; Chief Wallace, I Operating and Chief and Officer; Financial Officer. Calvin Rice, Chief a management, call After by open presentation the up we to will questions. your brief remind to that Spok's statements future to include subject and business want conference performance. call everyone I are relating uncertainties may and risks financial forward-looking today's to that events plans, Such as other well and income which dependent statements are as may include estimates of or upon future statements revenue, or conditions. expenses predictive company's the conference not to to represent These on this give only as statements date of results. estimates call the assurance future and intended the are actual any actual results forward-looking these Spok's in differ could those anticipated from statements. materially

assumptions documents relating Commission.Please any which assumes the calls. are Although XX-Q with Securities and Please and believes the environment, Vince. turn and uncertainties. Form company With reasonable, statements that, to from the the business Exchange forward-looking obligation related our to in these based no filings to Factors past Risk our over or risks statements I'll review upon and and XXXX operations section to that quarter third call present they Spok are contained be conference are filed to that subject the note update

Vincent Kelly

for quarter. morning. pleased earnings call. with our Good I'm you joining third third Thank very in performed how for us quarter the XXXX our team

are in are of terms generating we revenue, cash growth outlook. the our by excited we by prospects flow. and excited And are and We profitability our

our by our and that the in business term. revenue expenditures. return operating to over capital the investing long support managing Our and capital closely growing strategic this our accomplishing focus is expenses to to same, cash generate while remains We're stockholders responsibly

update at the this for for strategic of quarter. capital progressing share then guidance our goals we has of in future business capital We'll we'll begin increased demonstrate year an investments level XXXX and year dividend our annual plan fuel our returning path adjusted levels less we guidance to goal call. necessary our an Today, our our on are on and a flow those we at financial we cash least believe our initially sustainable our at Spok balance And seemed to these growth While the on in our dividend for reviewing dividend support of we in $X.XX future. by generating cash cover a results how XXXX, when to grow our the current midpoint to paying Further, expenditures. strategic expect while high, excellent continue as and on is on dividend struck today's updated the full is based prowess based by start focus between the to the believe of this our EBITDA path to agenda be we foreseeable you with will making pivot as the declared order stockholders. against looking goals. flow well may into our have progress announced our We The continuing as and level. follows. reviewing quarterly I'll XX% believe for

review quarter. Calvin Next, Rice, COO, detail. the highlights XXXX and a operational financial CFO, President our provide Michael in review I'll over turn quarter turn will for performance over to of Wallace, call more third call the who to the our will our our Mike to then

to operations up will start quarter with continued we then updated after business open the with period. And prepared will results bookings then in the finally, in am we software guidance your team second That and continued and in We with were financial third growth conclude able questions. the Any this for quarter third the high regarding momentum I to generate momentum call how our to the that XXXX. truly our quarter. record discussion our Spok's proud remarks outlook has

included contracts quarter. had customer third results quarter in second some that Our new we anticipated close to the

be We on we quarter software to broader year-over-year and window. we believe going XX% a X-month and year, were view prior the able X.X% over lumpy, achieved the we the over year-to-date to Software the able first grow growth keep of best to a our XXXX. Again, way for operations basis. consistent a with is wireless to year-to-date operations bookings year bookings growth them and Through revenue months slightly in total compared basis. of always X up software revenue XX% period are are up to were revenue this also on the levels as quarter same

adjusted our focus of as from X management operating on months continue same XX% levels first the period down expense the nearly XXXX. expense year through the are in We

provide financial corporate of bottom to regarding that levels our we is exercised line lease our of termination we termination headquarters with but Calvin when the to expect how results, Virginia. the at part XXXX. Alexandia, focus for As conclusion of operating the lease COVID-XX, lease more million the headquarters in an approximately beginning he the will continue remotely. early will we since September, annually save in work have continuing detail employees September $X our reviews the Alexandra onset for the manage to in been expense the of Consistent on option of

flow Spok of expense continue investments product the product development, and necessary management However, wireless professional on our not of is the the and Connect a at our to sales driver platform as to expense support, solutions. marketing, to our in Care support generate focus does growth come make we customer increased services cash

I the We operating even are be believe and experience solutions established savings create in look fair extensive and heightened significant environment. does forward more fire levels communication continued and for stockholders a will success compensation make we we on the to inflationary competitive each for focus estimates as continue as our mindfully confident about of have value In have a this cylinders increasing are and our we to success and unlock we efficiencies want in at future reported. we address we again once quarter our guidance on also generation. our Spok out, reality time expense all Based EBITDA out not the XXXX. come employees for revenue adjusted guidance employees year over cost our all time. close increased third Our every who to point short, performance are our to we sure quarter,

EBITDA We guidance revenue an $X.XX ability additional are X%, million increasing generate and midpoint to demonstrating of adjusted the almost by cash. or our our

detail expect revenue to this call, the confidence. Calvin for in we grow XXXX line. the All to quarter falling a of will company's but in our believe consolidated revenue in the revenue bottom low first is history. the point basis guidance year-over-year in on for increase more time go do our reflects the our of guidance so again XXXX. will we We in later And

third you our dive for highlights let that this the new to our may into be take Before operational opportunity story. our we to those summarize quarter, briefly me for of mission

generation, pivot, to which our regular value million form Our approximately the has record. track our stockholders returned started $X.XX business dividend. about $XX ago, continue generate cash in is cash strategic share simple: we or quarterly of stockholder a intend Spok beginning of per our Spok capital this has Since strategic XX of goal flow months to the the profitably, creating run that legacy and free and to proud flow through return stockholders.

balance, history generated In the in has quarter $XXX either third in Spok policy of totaling as and fact, our our our remains since committed repurchases, we special or our to generated debt of free nearly stockholders repayments to flow take in the XXXX regular EBITDA to more continues distributions returned share levels this million and into Spok we returned impressive In we stockholders, capital stockholders million adjusted stockholders. founded and did stockholders again XXXX, of dividend, $X.X we consideration approximately When to and expect $X returning cash our our XXXX. has company than billion Spok cash dividend repurchases. dividends through as to million to dividends quarterly current acquisitions, XXXX, share pay inception. since our returning now you to of XXXX $XX our cash

long one, and our stabilizing tenets capital focus two, software base; term growing allocation our disciplined expense friendly and plan. wireless maximizing revenue supports a of solutions; over and the are: in our strategy, cash Our investment three, the stockholder management; on four, those continued X major and

forward, Going continue established will extensive experience our operating create to our communication stockholders. our we for customer world-class believe solutions base value significant and

Michael Now and Operating Wallace, who to our I'll Chief Mike? operational about Officer, will talk accomplishments. our call turn the over President

Michael Wallace

good for joining for all from quarter and solid Thanks, and Vince, of thank another you results morning, Spok. us

deliver income net in diluted represents $X.XX to prior as happy communications. outcomes care we of health business continue quarter the matters $X.XX where our our to that being more increase continued remain or stockholder-friendly full income XXXX of up accomplished strategy, progress our thought enables million care in platform We $X.X seen third XX% teams and reputation and of leader and global generated a solid $XX than on track our importantly, communications improve levels report share, to year from we reach or a on GAAP in have from We million are true share execute customers. faster the third total totaled in most leader bookings net XXXX. to $X.X diluted year-over-year the for And mission year which to a as a to a patient per are information XXXX. plan maintain have software have continuing communication bookings operations in creating XX% Amidst year-to-date prior and surpassed not on our software growth. quarter we million, bookings per Also, basis, Spok Again, the the software clinical generate year We of all already for XXXX to to this period. operations allocation care while levels since clinical total when space. health it we smarter, financial capital

couple minutes industry-leading a Now take let me to recent about events tell X underscore our of reputation. that you

than results communications XXth nurses, and takeaways. contact the results X year, IT representatives annual month, of with survey state this First, major health personnel the executives, we respective responded communication input The unveiled of physicians, earlier at and Spok's center survey This care. about organizations. on released their more XXX

such as organization all across that one unified the is modern essential that Health that centralized one secure health scheduling, and messaging, is integrates clinical Spok platform rather communication is siloed, features for won communications, care approach mass leaders of on-call which a a care. than alerting provide. communication unified First,

Second, addressing the burn personnel is imperative. clinicians from organization across out IT to

this Despite we pagers. devices of challenges relevant. risk remains Although health as Health burnout. care that encrypted communication devices, a X/X efficient and are effective positive respondents noted mitigating And importance the stress hospitals and shift trying and safety organizations work-related their care burnout. to or the about seen that communication organizations smartphones, and front tackle is whether on we be patient diversity clinician have of lastly, versatile realize crucial WiFi phones communication outcomes systems the face, and improving for of and recognize

We customers, unparalleled Based questions new event event on are and hosted. on most well the group the event attendees, And Connect. in forms, customers was who's we that market received considering X,XXX loyalty budget included discussions proud we year of the virtual our of the and a customers as amount thank facilities While same resource and the take care who health hospitals paramount. as opportunity the XXX The their and care technology, have hosted we presentations for and this believe served their participation reputation chat, successful customer Spok the Q&A organizations. want this care this as we our we and teams general health has ever in the and of within held both feedback our by when remain customer we over survey the built for conference, representing have United biggest to remains States. of support. and nearly to our our virtual over Spok and representing sessions. basis management roundtable had the The quality constraints again results breakout user XXX week released leaders challenge the in patient annual safety

built half and relationships. years is This many an our have from this hospitals large million in in renew valuable operations that Despite of We company, were the saw solutions $XX the second and buy anticipated a have software high at several second us forward amazing over and regularly to of long-standing valuable these that level. bookings quarter, deals pulled customer for close XXXX. maintenance the and asset record

contracts quarter's third able in this and were bookings bookings X-figure X still was growth team to Our XX software new year-over-year generate X-figure in customer for operations quarter. Included the contract.

largely multiyear in the contracts third attributed secured. X we achievements be quarter Our can to engagement

nonprofit the in with was health States. integrated academic the first one United care of systems largest The

large with hospital a in Another Northeast. center Northeast the the leading with system final in university cancer and the a medical

The pages per over XX platform XXX,XXX Care for first health leverages Spok entering system each operator calls, Connect hospitals boasts monthly over over XX,XXX XXX,XXX XX,XXX over employees and month assignments across on-call and managing month. sending the

management. system of data partner workflow are our change unlimited to system solutions. value-added that Spok And suite existing users, also this delighted additional mobile small the for maximum health with And identified for as all from Spok smart These Spok's this includes console the services, integrity, health of one including Suite We country. engagements upgrades, opted announce value outside Smart of in drive variety and the the help of upgrades. multiyear today analysis global licenses, customer, almost services engagement professional organizational the a organizations, of an largest deployments X,XXX services Spok's usage Spok value-added for extended Spok our

excited we're health expanding the history efficient ahead, and to of solutions Spok facilities. implementing this a care Looking in about other within boasts Smart delivering locations prospects Spok remarkable Spok organization. Suite Mobile communication of

Spok with standout contracts Spok's and service consolidation Spok and engagement last well Spok's facilities employees over it's hospital academic was X-year was across XX,XXX Suite, multiple our This solutions leading is campus. of value-added quarter Messenger customer with enterprise a for Another solution assessment. speed across as XXX as Smart on teaching almost beds

Smart physicians and the comprehensive service. our centers respective the cancer another world's for with was attending nurses. and inpatient XXX value-added new upgrades one on most executed multiple across messenger Finally, beds with Spok X,XXX over as of solutions This Suite, solution X-year assessment and and we licenses contract over well eNotify engagement facilities as

our we institutions software communication commitment Our showcase and change to providing our health care will are unmatched solutions positive that for continues confident to third continue drive quarter success clients, our solutions to to nationwide.

pleased While second of saw level the with certainly are historic quarter operations we that software we momentum third coupled the quarter, continued with in bookings. the

As previous operations earnings it calendar we year noted look on appropriate calls, is in at a bookings we have to more quarterly basis. software believe

momentum to investors Rice. year. low that the the that XXXX over for we negative With of out on cycle. Financial are we now operations like generating normalizes terms could in a we in performance course, spend operations of of sales looking assessing most anomalies deal a of software over basis, that operations basis software better the While, I'd is the both believe contract-by-contract great percentage bookings overall full teens positive With growth year be analyzing turn a XXs in growth our well. to Officer, of software call said, annual appropriate upper to bookings when to our as We and timing bookings sales period time expect at Chief reflective arise full Calvin the and an that, is year-over-year for Calvine? more

Calvin Rice

a our when review performance, this good I minutes a Mike, now recap reported XXXX about financial we our operations I filed includes third provide cover XX-Q information quarter everyone. significantly take will and Thanks, we our business like more yesterday. would to than of and few call. as performance on you financial encourage morning, to and it which

million income performance. diluted million second income or in $X.X compared share our per In Turning in with net $X.XX XXXX, share income to of to and the $X.XX line period record of $X.X GAAP quarter same net the diluted totaled third our quarter XXXX statement. per or

the wireless to in to significant of of and be total service revenue For compared quarter increase With revenue of year quarterly low our year-over-year XX% is bookings per unit improvement from professional This a corresponding GAAP up third quarter, was was $XX $X.XX of saw by primarily which relation historically of churn remain These prior ARPU, software of the million XXXX, by in quarter quarter at pricing ARPU average $X.XX net third $XX.X in levels for increase to to declined additional of year-over-year. $XX.X to respect the revenue, wireless of in largely basis $XX.X pricing will million XXXX. a year $X.XX last flat essentially to as projects. services by driven the related fully from being roughly of equal. $X.XX the be significant professional quarter improvement XXXX. revenue unit, to revenue and actions performance X.X% in on period. million, increase which fourth Net realized quarter result in continues in units third the driven and actions the in revenue consisted taken Revenue year, the reflecting backlog million, service results, things all reflected the in third continues in or of of revenue $XX.X period growth the million prior September revenue we anticipate in

believe like the our and and through will which guidance, offset declining as further through will for reflected that to While are services Gene service, revenue financial basis, reflected other secular shortly. on focus the pager demand our a lost pager our walk units decline. This to in we decline unit is I continue updated continue will pager initiatives in pricing wireless we on hopeful further

more Maintenance revenue third of Turning in from was of up License and of million the revenue $X.X million up from quarter. quarter. $X.X quarter software in than revenue year the the prior totaled million third by to revenue $X.X XX% was XXXX.

revenue maintenance as discussed bookings road years map to we Care expect continue grow on Spok with we coming with in progress it. previous product calls, the along Connect, our and we will in have quarterly make As continue to

maintenance lagging basis. will through revenue a of work higher the sales license on Given nature revenue,

are first believe accomplishing levels record the with revenue the Professional $X.X to consistent grow second to and million third achieved look it. services of stabilizing in XXXX revenue which then decline, versus quarter healthy of we to that the beginning a was we we close XXXX. $X.X million So and quarter in

We initiatives cash our backlog and improvement continue align to on to driving higher with delivering internal utilization, resource rate see better our total resources flow. in net a sustained of

needs, been throughout meet demand. We expect current to our XXXX to professionals to have meet the half we in backlog continue anticipated sales that second XXXX service hiring of and

our million, operating development and excludes Third totaled $XX.X quarter with operations Increases accretion no of selling reductions normal nature representing costs in relationship primarily from our in by year-over-year the relate reduction and severance continues and savings period. from cost restructuring research in declining amortization see revenues. costs, by which in Increases initiatives. expenses, and commissions practice were were largely offset more timing which to change costs and driven higher prior which wireless adjusted cost-saving depreciation, in year technology G&A, to than benefit to French and

need As the support now and early would are in headquarters topic additional the XXXX, our resources quarter option operating marketing additional early we termination for prior sales the look release In lease Also, for to robust years. of lease detail we briefly our to at let exercised a These will will some an X Vince's look activity end result. success years Alexandria regarding of while XXXX. me will continue headquarters building. pipeline sales the we costs X on Alexandria, a early have sales September the Virginia. we of sales expenses, sales add The on September and over fourth the of XXXX, we last and the our marginally corporate XX, termination extend as to as achieved foresee and into generate resources expect increase we comments

reflected fee paid be XX, As September of onetime will fee balances we our as remaining a to $X.X XXXX. through XXXX. a termination, XX, million, result severance cash termination restructuring in amortized and costs termination The of and September lease of the early

important benefit it's expect go this of light previously, These make to increases we of result these increases heightened levels save the experiencing, In results we Vince financial salary will based and believe fourth reality. management. at million we qualifications people that all on of all approximately portion expected company-wide offsetting mentioned been take of inflationary a performance $X as towards will strong we as how care our Thereafter, a quarter. And in below environment certain the have this the senior annually a be decision.

a what company will location Additionally, result corporate we in decision. to important employees employees it's existing to not material Approximately expect relocation a this of that result the costs market. does a our to of ensure of The Texas change. still highly is its this care impacted and as can take Plano, we as competitive be anticipates be in headquarters XX of compete incurred

since risk As formally XXXX. given largely will Vince pointed We transition early this and this out, been no expect to work. remote these no related see our to employees transition issues has posture

While company have was from made employees we productivity greatly work-from-home of greater seen savings, decision preexisting and for to this not posture. significant our higher flexibility cash benefit expects the likely, levels from the

from Lastly, out call, near XX% the $X.X up was adjusted EBITDA made same third our the with in pivot. million earlier XXXX, as strategic in the of nearly the Vince million record a reflecting progress date to quarter pointed $X.X quarter, in

$XX fact, In adjusted months X EBITDA up from the has year nearly of period. million, prior the totaled through XXX% nearly XXXX, first

operations improvement increase EBITDA first year. expectations in XXXX wireless us has strengthening the trends in X levels, for in to, bookings, software of terms of again, the backlog all led performance strong full across robust adjusted our Our categories months and

in the included million be of a the reminder, a $X.XX revenue expect XXXX, earnings increase I'm million figures today to now to million, the in As range from release. discuss previous midpoint. table our $XXX.XX are we in going $XXX.XX guidance guidance In to total the

million we that high consolidated from with guidance, year, to annual discussed to More to as expect this first company's end continue previous the earlier. low as end the X.X% at of Included revised range I the recent $XX.X we revenue increase of Vince trends guidance guidance guidance. we million, importantly, a rate will the $XXX,XXX grow that the and our out, between prior as our improve, in in reflects represents expect growth wireless the the midpoint revised $XX.XX expect from history revenue time a pointed to

midpoint is range million, to levels. implying to expected X% prior from of software growth a $XX total revenue revenue Software with more from than million $XX year

adjusted to $X.XX on in will $XX almost quarter, a performance our increase these the that our to turn based the is midpoint. EBITDA improving over for Lastly, said, million million, guidance trends the third back XXXX now X% or million and previous $XX.X guidance With I revised call Vince. from

Vincent Kelly

Calvin. you, Thank

we'll with cash ask story the to result your will to stronger we to Before initial attraction continue for We opportunities questions, additional our press of limit the for their and That questions the dividend value. Piper also we community generating despite ultimate time our let and just me It everybody We're investment growth to on reiterate Operator? follow-up. is the team operator investor their remains committed you tell as open to us call our Spok policy. record to the continued a soon entire efforts I'd of proud second there, come that, hope execution. guidance tell like how into presentation thank take At Healthcare and consistent confidence our Sandler take momentum support to focus us We'd and and presentation. XXXX. your Look like current I'll a up capital our call performance to an release New successful the stockholders which about shattered we and look business And upcoming final your generate the on allows. see to increasing Spok's remarks. and to timing to increase I yet that our many focus open stockholder gave will a after of even springboard know concludes for to want ask to a in marketing questions that as coming am and allocation that activities the the provide for quarter primary and maintain again, note, of the at ability to dates this believe their to up and metrics. I'd you our prepared Conference and all the point, off further questions. one assure you we'll a then York. On

Operator

Martinuzzi Street. Our question comes Eric [Operator Instructions] with first from Lake

Eric Martinuzzi

revenue and a well that profitability What the I Congrats in price question increase? in had what impacting? on September. year-on-year rolled the was as increase price -- now in, installed row the how the you a regarding quarter as base percentage is of much growth. And second the of

Calvin Rice

Good. between XX% Yes, out price somewhere of is in to Calvin. in the rolled impacted Eric, that and this a fourth base that here. the increase probably XX% X% so reflected be base, September customer we to we that fully and quarter customer expect

Eric Martinuzzi

third Okay. see in the an And churn uptick then I did in quarter.

churn kind a investors X.X% have are What you and for guys X.X%. of think I You in been, range that to? was QX QX an uptick of expecting can was X.X% then look we QX. saw

Calvin Rice

Yes.

and don't for the isolated, last from X would that terms give we any very part is lowest expect the I to third probably uptick believe trend. take. over consistent quarter will Those last quarter of one so, So or new to the third range the be X%, churn see variable decade rates We'd churn X.X% fortunate next. a the of in of decline. it's record months say on it's been anywhere to probably we've in the in preceding been probably quarter or

Eric Martinuzzi

your balance $X.X a million. at the between yet cash sequentially million EBITDA Okay. disconnect the And from I your adjusted ops The and was cash cash $X.X then in EBITDA declined and ops. from adjusted coming noticed and

from just and So the walk me through op. cash the the between adjusted EBITDA delta

Vincent Kelly

a working had capital. affected the Yes, things onetime couple of quarter Eric, we that in third

our getting buying in we That's And that. about or a different what, the spend are policy, us lease, then things do and had free forward, that's thing did to this about, was $X.X about to the a about us the going million in focused we went forward. $X PTO third won't but Those items termination $X again. we to paid going quarter stuff on spent that of quarter million going the a the out. One be to save first is to both million obviously ever we other going fourth to year were early that the save Calvin, All out quarter or capital that working flow. year is cash $XXX,XXX the on

Eric Martinuzzi

about just the flat XXXX. back, and And the in about the that's Obviously, I've then tracking software up the on of lastly, on wireless to stepping on got up side here roughly year. X% you're growth year-on-year Okay. you house. X%

XXXX You modeling growth kind about potential give it did comment to of too out. is for next soon us us in those of your growth rates range? prepared talk Can remarks in about you year? a anticipating Or

Vincent Kelly

is expense, plan, are beating, our period beating professional hours, plan compared gross look operating we're Bookings at We're wireless, Look, at the the managing and our we're beating up on our hitting doing first software right board. revenue. look is in last plus that adjusted their out our We going beat now, are us, top EBITDA. is rate, is We're service huge we a the right. a all grow additions company on same When your beating going maintenance Gena company's CapEx. Eric, line beating, same their model. our from all to And wireless plan, cylinders. on The that's X-month services, When We're the plan. guidance. our the the break and beating we everything sales beat We're this we on I history our year. XX% total managing lines mean perspective. across for time, obviously to

the low turnover has the and team to R&D is great company to really in ever we've We're had great year things reveal made Our on is in software morale next as high. some have progress. side.Employee as about going

to the year. put out before probably the So in guidance of we're grow XXXX. end going We'll

but were We that haven't and decided talking about on mean internal year. this of going exactly lot when, on. internally. significantly where been ahead at we've A things sales last they results I time our are our of plan good

And deal XXXX. Gene our And size we even year total this year, is over value reps to sold this and more XX engagements last this we're multiyear $XX of got We've we've doubled this this X Our XX,XXX, none. year. year. target of pages XXXX, those million has year going tripled and next over team average million. It's XX,XXX already $X.X year do sales in our a sold and year, had that booking had alone over about over

growth a That's to going on our now, the free still disciplined posture capital it's but and flow we from shareholders. standpoint goal. on be to we're returning that So right still #X focus cash

almost like We to their utility. that going making, think, and with we of responsible in our the still investment be I We're that care our industry What challenged customers spending improvements to expect resources. a terms into internal for our do somewhat is health is in platform. back

getting not like know you're way. I really you what, here got rocket paid might a a But like think good now, right business grow people model we some the along do.

you for going the And have answer some We so expect we'll what year we settle grow And you next we of more year. next news do can. the to to some year. it's We'll guidance is grow. as dust hopefully, get the out we'll let for as But guys before the soon modeling. and on end some

Eric Martinuzzi

Good luck QX. in

Operator

[Operator Instructions].

from comes Christopher question Irons. next Our

Christopher Irons

Steve, get you great those Fantastic certainly anything X Wondering was raising see that the on quarter. offer regard, said to you things. In ahead wanted you I anything kind don't I it to talked can receiving you Thank just at much interest. know of very And had point. things and interest of last because if talked an wanted if I there's in touch update had to I quarter. just interest of to everything. update also quarter, company, last the potentially can couple that. quarter, that unsolicited some you want for outside new a but if a you line about in it dividend don't want about on

Vincent Kelly

Yes.

Let me second take one the first.

into was talking At EBITDA grow first year, to cash adjusted XX% existing we our The free beginning the our about less of covering the of with with were CapEx. dividend goal dividend. the --

significantly. that beating so obviously And we're

about we'll this less XX%, is what adjusted think CapEx. year EBITDA Calvin I cover of

in going we're lot of be cash So obviously through XXXX. not to burning a

And So to decision. above to XXX% think do with to we want that. time close we're we We make determine that. want getting very, that what before have frankly, very to I get we

XXXX, is what be to for where for going would I looking. And I if we say $X.XX say probably would So we change, bank you would that's should a were XXXX, on. make

those there's a your gotten what's not we're right now. We're in mean sales the -- has now. gone of Look, this. tell that. that's these haven't asset has absolutely, the market company? we We've the it's We're the rates interest a not customer you, and a company cash out we're now. have first and for have have not can community, this every question, interest we of a running rare public the like interest at for many calls. off an of very kind of Is for company, market now. us the calls. on going A that in kind tough base have couple process It sale of bird in right company. sledding there sponsors So we doesn't is right got sponsor where an sale day. And time results in guys been in like kind of I there the right

good a all So we're if really but boys, pay on Because we're come things us, We team. okay? up, you're executing and Spok. get here us is we've to to to they at high, going have great and Morale going had want got and on going execute. about

we're we're unlike our and But right the with pleased some now, us. to what and can doing take that of do results, the look our outlook. maybe a portfolio, at we're going we're someone come very very your want it in in you execute investments, if with well do, we pleased other and So meantime,

Operator

with George MKH next Our comes Management. Melas from question

George Melas

sizable Good you side, again. outlined the very those Vince, And Mike replacing for are other are closed Or whether customers. job The replacing Are new question Mike I who and you deals systems? Calvin. the internal sure quarter. those were X new replacing? on quarter on is not the customer was you you Mike. that in you third-party software providers.

Michael Wallace

talk Yes. talked all in that George, X to quarter. customers deals this about the you. to were good I Yes, existing

the position are somebody, use But internally. that broadly, names. So question our in are to those about we businesse's of Yes, a the probably a where There that of displace. majority none still out XX% there our logo, as I XX% the calls, is do look, lot obviously competitors were on your mention we as of we've talked it R&D our the continue is an our we've bookings reality perspective do times, while. is focused the Spok past systems We solution or as have get out allow new you won't we're on-premise a opposed the to several on over things the a next us experienced to said putting years. I've previous logo as from that in market quite know, more and shareholder And expectation years for several being plan to will over business that displace installed typically base. they some new of we when answer execute to about new in new again logo. internal are more than

you will, of the really X look the X out years. next kind if plan, if that's So you over to

Vincent Kelly

top look we and from would of in Spok point pipeline of meeting the Division what of were will competitors. when offers And to both specific the we is suite. of in division refer the Western the at talk solutions. what Board. that add not I couple competitors to yesterday, very takeaways had takeaways some deals were offering A from pipeline, name I'm Eastern are large takeaways our sales each characteristic Board George, right that And And got from large Mike said, couple and we these our had managers to in our And you deals on tell now a just common have the enterprise that our we to we to year as and going these our competitors. competitors, you the but division more this I to

do competitor they things. frankly, kind do that suite consolidate EHR specific as space of that took It's So years the point or a took that have. ago to of the to same solution Microsoft a Epic a we office win. the tactic, well as We whole lot with don't have to

offer going long the can you're to you you suite, to term, you're an that off a of and If sign engagement races. with a the headache save multiyear in they'll CIO and integrated then lot

and budget that making more So more flexible about extensible our that going forward. and strength our and focus suite building on all more is R&D and powerful

map 'XX into coming business lot road new we logo potential think of and And you'll in 'XX make so terms I see, as on progress a more now. right in the the

be years transition our us think terms I is platform. a of going to our best for in huge 'XX

I think going years to are best our 'XX. and be 'XX

a in got we I us. think front good things of I hope helps. that lot of

George Melas

That's quick And Definitely. interesting. really Calvin. question maybe maybe a then for

does the maintenance I in increased You've had just in that flow but revenue I amazing mean, nicely. it I also the P&L? quarter, the through this software bookings see How especially in the second year, third. that like -- is mean,

indication that's think I flow. does But of So incredible success. how it an

Calvin Rice

Yes.

bookings the of terms and between services, the to equipment. license, mix number that's So correlation generally booking going the maintenance between that a exist isn't direct in P&L, breakout speaking. within significant There's and

to a we And that's into sale, make going go so backlog. when our

revenue backlog, future growth that the represents and And relevant. backlog yet really So recognized. you've are which be bookings in ultimately similar seen to

So equipment book License turn. critical that's in are and generally element. a relatively

going And when a the be X X So those going are are from months the several projects, front, going of at projects the contract to X but the recognized customer sites. And then services get typically resource get running, flow allocation generally going And up couple that's X sold through revenue time, the be to to on immediately X from or recognized to anywhere the standpoint. on over a be next those it period, to generally, as are take either themselves. completed the months typically in components maintenance, that can which within to then to months depending that's can completion years. and

XX we through speaking, generally those so as flow of to And about to look months kind projects well. for

George Melas

me remind you I software appreciate a Can Great. XXX. lot. Great. that, Okay. thanks

Calvin Rice

welcome. You're

Operator

There Vince are back to like time. would at comments. to over the questions no now further Kelly floor closing for this I turn

Vincent Kelly

put is company about be what then. and said, at today. to for month. accomplishing, we're Like this in when 'XX future. get our going Piper participation proud and I the we'll we'll market we want very your of out, to everyone, the also conference consider York guidance thanks, We're excited And the to Look, we're New back next

report being a of And to forward have results of supporter some day, Spok. look fourth late quarter our for year-end February we'll talk and a great And you in and well. everyone, to seeing there. thanks as So there you

Operator

and Ladies conclude your today's participation. does teleconference. This for gentlemen, you thank

a and lines, day. your disconnect have may wonderful You

Spok (SPOK) 26 Oct 232023 Q3 Earnings call transcript