TTGT - Earnings call transcript Q1 2018

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Operator

Good day, and welcome to the TechTarget First Quarter 2018 Financial Results Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Charles Rennick, Vice President, General Counsel and Corporate Secretary. sir. ahead, go Please

Charles Rennick

Denise. you, Thank

process. turning the Chairman; to Strakosch, Executive earnings to everyone call Mike Cotoia, over release our and of want the Greg our on our call Before CEO, remind I

update As previous announced, on posted business on order and to the we X-K. Investor advance call, shareholder of an on our furnished with of website provide in our the you in an letter Relations section it

your questions. Following be answer Greg and available management remarks, will team Mike's the to

forecast. On addition Any our we made considered are guarantees reports in are forward-looking the our Dan today differ Actual have future may Please based These annual our performance. factual our may refer factors that Mike, call, risk and assumptions statements on and Greg to to TechTarget Noreck, be statements A are quarterly in to CFO. SEC. statements. not with not this also of financial of These financial With measures We as I'll results in may not forward-looking statements refer only from TechTarget filed and letter. measures by to call our GAAP. them. obligation most prepared and Mike. with comparable no measures accordance these GAAP call, of the to accompanies update the speak of to date the turn that, Greg shareholder reconciliation and over the non-GAAP undertakes materially

Greg Strakosch

The QX. momentum start. in from from this QX year over contracts, a QX in up Engine in Thank versus our generated our off $X.X XX% year. from was Deal Alert X. was a in Engine new Great. XX good Priority Adjusted up We XX% customers customers were we longer-term more from a in on ago. our doubled XXXX was The were up ago. number revenues ago. derived Deal year Today, had IT And revenues up up over, raising QX. a million, Priority forecast we in is is XX% you, Revenues EBITDA are of Charlie. of over year Alert XXX, XXX Online a from XXXX versus February in year ago. very IT up XX% QX carried from than previous XXXX into QX. provided XXX% for guidance revenue to

Our be forecast adjusted new and $XXX questions. between and EBITDA $XX the million, for up higher revenues million open to be is million. $XX for to between and will $XXX now call I million

Operator

[Operator Instructions].

question will Your from of Fitzgerald ahead. come first Please Brian go Jefferies.

Brian Fitzgerald

the your about of contract. letter, having towards in revenue, from representing XX% wrote you goal driving of curious, longer-term Just a

Just of curious clients lot that of the second goal stuff of and for follow-up biggest with back you what years? guys drivers see search the that And kind over the what to you next seen headwinds that? your the you regulation, upcoming around the half? GDPR offer how a do really how And in come utilize business impacting some in the can as have biggest you are the also, X and are, then maybe achieving that a think

Mike Cotoia

revenue Great. suite Alert to IT quarter, products. Brian, XX% achieving Relating biggest Hey, of the first Mike. of our Deal would long-term over it's on be question that your drivers the

niche real our to allows buying individual and intent account have geo by level them segments the So, access into team access insights all an the customers ongoing continuous allowing the basis. technology level at to have to very and observed at and on purchase by

purchase the company to deliver and focus gather big longer-term it's our for from insights that to model. So, quarterly subscription model intent as very been we you through our a campaign-driven a integrated, transition having to being an to know, data always-on, that able Priority Engine able be as really but our their to sales to the to new going that that current is of workflow the deliver get you've driver help and seen only launch, organizations, to customers, customers, marketing being our biggest not through that. and into also And

In not looking headwind, a just our it's of in at terms changing mindset our think a terms really through we've being and of sales I media that. good of product necessarily And customers' that, but would data headwinds, a say, done it's versus I execution, job company. really

just you year, ago, years couple As basically at you was Last this XX%. look of can see, time, X. number was We if a reported that XX%. it back

feel to next within achieve track the exceed we're XX% that on goal and of So, we couple to years.

Greg Strakosch

having and that our Deal some number that's we're success And make -- starting is customers new integrating and basis, helping really point helping for product one that's so us, products would our on of core to core an are our that overall our as us, as with IT annual well. other I products that's Alert the buy

Mike Cotoia

regarding second question GDPR. On your

our any or with regulation the always negative. bit It's a confusion. with creates little new First, bit customers, in little a it privacy market a of of chaos short-term law,

it relates in as earnings us. to even see for February November, back a I call in the competitive as However, this last advantage we think we TechTarget, as and mentioned in very compelling

to got content, the registration the the own own sites, process. own we remember, we own You we the audiences, we

comes permissible membership our on real is our when fully and So, to database, based register, consent members, our on opt-in, to is data. intent our sites

market they data don't clearly don't -- content, other They try get lot terms to being they're providers the own well of with as audience, compliant if a there challenges going GDPR. able own companies the to are own answer the the I think are into -- sites. media have are in as to might We that of that

that is us. competitive advantage a big for we feel this So,

Operator

be will of from Qian question Jinjin next Needham. The

Jinjin Qian

One grew great North is, on from Two questions, if accelerate the online a we quarter. may. to and a I Thanks quarter. almost continued congrats America last flat this lot, international revenue quarter, see core year-over-year. nicely

given your the the year? have through halfway customers -- well the QX, -- remainder can on trend, overall what trend us seeing largest of from we're the strong as you of as are And in almost you're activities if if I think for continue terms the rest Just give color you follow-up. some IT a spending -- seeing both

Mike Cotoia

which based that well report on really strong we saw, large as reported in vendors the the was growth some are of the shareholder so core to IT X% as encountered on we in saw And past included in they Those we are acquisitions we that And the those primarily we our our those a through organizations attributed vendors. saw segmentation. yes, XX IT global as that customer Greg past, divestitures. and business. reported Jinjin, largest dollar, the headwinds letter, large getting had

we're to and reengage the in start brand. these this seeing reinvest accounts happens, As

very with So when - these for fairly brand will recognition, come the and larger that back, are there typically, of signs market turn back and recovering, it's familiar come quickly, they on their can dollars. to them have they're that easy brand They a is investment. comps lot

those So, to come we're starting in. back see dollars

talk customers' on I However, note, in large right intent the and I think data. the it's help through Deal market directly really based Alert them also global helping by in to tell - in accounts because IT it's prioritize Alert. on landscape. our active related our who's IT - about and are prospects them that And to IT driven that, the Remember, today primarily Deal core the we across capturing important said, vendors. execution business and prioritize we'll as like The improvements and who's the right we're delivering in

thinking if up still engage they're it's to still with While They to to buyers and them, influence, engage, to those they're customers. market when need of up our in go message, buy. them

global the IT So driven vendors. that's being by primarily

In terms trends, of say I'd spending fairly of in it's with XXXX. the the first IT half year, consistent

definitely are there of improving. Now some signs

core, and start signs which the of investing seeing some brand. global I And was primarily they'll to when go they'll in accounts they we the think brightness, vendors some optimism discussed, one in sign, invest core. start when just or the

not our our the that starting some see to model benefits IT as that. or the acceleration to up of now, relating of half. which some are But in see business. it's light of would If we're current right we line And think set it's switch some on revenue not now. in a side in things spending I right those in to see pick does, second So,

Greg Strakosch

So, We think grow. so to we're that customers' market think we core share help. on to well our offerings because That's spending extremely regeneration will extremely the branding with our lead way offerings. we IT integrating well additional expect - going improve, us think, purchase will we data and we're our to gradually offerings, our budgets intent as positioned in for gain with generation lead positions branding and

Jinjin Qian

got Great, it.

a we long Deal follow I'll It's Alert. IT up seen just slightly haven't So, time. for down Q-over-Q, which on

going that's if there's Just of purely through it's run the still increasing on. we kind remaining if see else of expect seasonality rate anything Shall or the trying year? to

Mike Cotoia

I at our was the quarter, growth core had, Greg the intent in believe, QX seasonality, XX%, revenue a and majority have in integrating like QX we business we approximately total expected, will expectations say in hence, when able what growth comfortable X.X%. raised under the you XX% I end, on Yes, of Jinjin. had revenue comfortable And quarter. year, the down purchase I Deal at is and little And IT revenue, guidance. QX we we feel what is we the on to of feel focus And of overall our approximately about primarily that XX%. the think have the help terms supporting was into But QX largest line if down, Alert, that a revenue moving Alert, big all the quarter, to will of we mentioned, Deal forward. the year-over-year core. IT smallest accelerate what to that And revenue with X%, very the we our throughout look too, and also be with get that the terms pretty was - our from in due we solutions of

Operator

The Malouf of ahead. next from Capital question go will Please Group. Craig-Hallum be Mike

Mike Malouf

off question. If, with a just let start me

letter of fluid. us becoming talk little give It IT and that of more on back little Alert Can purchases of commented doing Online and You that you sounds color a your bit Core within the about bit your some programs. that? Deal a forth these sort on on they're just are like and more

Mike Cotoia

campaign-centric. be want. get they campaign-centric you IT switch can to could example, for if their it do and business, over type Mike, if trying you chime may to our When very I focused settled what Greg, of go can very they like are lead some quarterly our of some get may start where on branding, and mean, I to in QX, be on customers annual on like, quickly it activities, Yes. and budgets the our, of you some trying and, and Alert campaigns, there, core could and we and bridge call because gen Deal it's some budgets

that an by you goal we core really products what can some everything on where the Priority approach generation is been products, of, know, core. intent, Engine the products, whether for the of that focus overall organization the We've it's business trying through them visibly can purchase value see the to see, our our lead products. for always-on, showing As of so the integrated you data to our do terms have is really and powered working core is in in like, customers our

to some is there's that. some back-and-forth, fluidity there So,

it's it's I IT You Alert our branding they're consistent. highlight it's margins important core, know of of or like, across all products whether whether IT to that what our the are the Deal all specific Alert, Deal products, I'd same, any think

and So, overall really sell, guidance. as gross sell overall margins can see the best in specific the Instead maintain growth, raised to position. and for what's good of same product a with we're a in clients the we really our positioned leading

Mike Malouf

at how Okay, ago? that do think to that up I the think, course, million it when Core to starting a know, range Online were few don't kind you is that quarter about $XX of $XX sort business back still call do you And of environment, of attached right in then at become years you more, to that great. are able think hip, though, the a million the grow to we these

Mike Cotoia

couple Deal I I We great of solutions. It's real this the we discussed and do, is discussed mean, the do. last question. this. a quarters. IT quarter, driver I last Alert We really of this think

accounts, is, it's your in can So, this imagine, a technology customers is in show or the we client all we EMEA focused just client show and we can a specific them recently Latin them, here whether America are when launched America, APJ and and data says, into on here that and the solution, we that walk North or prospects.

in thousands. help prospects can that well rank we're the prioritize those higher actually upcoming that are from Priority engaged as how are these as that Well, you in can an it we and your And are one in accounts to within can active a So, to them we them marketing showing right with buy them we propensity market things show and they have solution. Engine also not the But tool content. engaged this.

go you insights that know the real, is TechTarget they know to where is active engage can these that it actually prospects move and purchase them, do help folks, and and has simply when with market. the they with and intent needle the and content put So, the they marketing they that accounts so end, they their and branding the have capabilities the in against position, the most leadership equation back show at the data to elements

Mike Malouf

my that’s Okay, thanks question. taking helpful. for very Thanks,

Operator

question ahead. next Stonegate from will Marco Please be Rodriguez of The go Capital.

Marco Rodriguez

if could a more I regard talk little these bit to always-on you wondering was programs. in

little of far of color kind in as are of your customers. understand of your to approaching customers how out Can you sales and efforts as your marketing more individual there? little trying kind terms perspective Just from teams sales bit a here to branding a provide and bit

Mike Cotoia

topics branding look weekly, and quarterly, Yes. we purchase IT Marco, back insights to that, years show the sales with our to which across purchase access to of is primarily insights, Engine change platform, our and generation and force with customers' lead have media the enterprise integrating those how couple in can Priority insights, lead data of or if happening the world do solutions platform used you programs. our leadership into to have purchase insight I our to about leading talking BXB our customers access Priority and mean, and now market ago, universe insights we position intent our monthly, allowing and with our we Engine intent sites insight that a and workflow. leading now having position our intent is right that and in But of customers a

So, it always-on we're where right will the are them relevant week-over-week now buy, are systems We not strategy only your accounts now with consideration and mentioned Then but and update accounts should and those between that active quarter-over-quarter, but marketing, these in producing into refer as talk syndication, active that can our this data with customers' to that and marketing are them, that month-over-month accounts accounts. the buyers are competitors, new want where is along appropriate can being on and being with visibly aligned we elements this and just we able say the editorial to doing which is efforts of as really content, on some and are or terms aligned Engine, market show that leading the content caller, highlights And accounts contextually with the released when not to with brand, here prospects we're to effective. working, just the branding and active today data. what branding and sure is against salesforce.com. We buyers the workflow in helps active most it's really active in I is through not messaging only -- show always being about we're that marketing you. between the show the always-on a their And the having engagement are we with marketing oh, previous with Priority their making then your instead automation bridge data, gap what what what of and sales. I -- content handoff focused integrate well,

Marco Rodriguez

mentioned customer one through the have, starting to customer Is you an you clients will, of you And basis. guess, have just businesses if some of or you guys kind interest? from been core either some organically, I that had that putting of a on that something to happened, individual buy Understood. question a annual something I started guess, from your that in answers prior that guys to are some or the

Greg Strakosch

Yes.

we basically, want typically And we they say, basically technology in go say, to always account want kind -- know active we So of yes, said, that do your Mike segment? people we want that's is interested we every customer if it as you always that into be changing. active the what that would sell. And segment have could show we is and we would have whatever you that, to because, hey,

say and content any makes you natural active you So who answer it you those. the at to want those in to and prospects know messages branding actively second active that's well, the at - that time. is, yes, also okay, your Then the all all sense want we messaging Don't question be that influencing want be to always-on. we prospects is, with one as your do of And the times? with to front are

And the selling always-on lot that success of that, the say integrating be active do for also under starting you the but to basically and that we're messaging then good for those people, strategy, different most product a announced the and we're can Alert, is Deal with always And in our - success you and IT or campaigns those to different to a for sales But having doing definitely, annual always a know against always-on in then up with come have we the whatever have customers, new we as the of Alert, go-to-market we as team, hey, that's you're your up, annual Deal should you contract Deal IT we is a offerings and an well come say during initiatives of key core Alert So, specific both should - who's contract. market, you offerings. it's basis Alert quarter-to-quarter, you combination popular serve customers. a and IT of and competitor, IT offer combination been very quarterly Deal - core year, a core on then campaigns our campaign because products. a

Marco Rodriguez

it. And incentive them? wrapping there sort is Alert priced Got combine of of the if separately Deal of bundle and were similar and they core, them in pricing always-on the of pricing sell you IT is the - product kind the do those to the just Or - some from together?

Mike Cotoia

core The bit integrating big do have when business. of within integrate little core the a It's as the and it's pricing as quarter very our a that's Deal IT in incentive sets. really and you the on, data the different We provide models. Alert everything focus there, Deal always well long-term revenue subscription IT in of Alert

So...

Greg Strakosch

be tend for buying quarterly. pricing The versus incentives to annually

So, sort versus pricing versus annual around someone I and discount. mean, is core annually it's incentives both where some quarterly of make more the are lot quarterly. a primarily, incentives the But we are. it token of obviously, buying

Marco Rodriguez

appreciate Understood. a time. your Thanks lot guys. I

Greg Strakosch

Thank you.

Operator

And thank may We time, attending today's gentlemen, questions, the ladies call. this At conclude lines. you with presentation. will disconnect you your and conference no we additional for

TechTarget (TTGT) 14 May 182018 Q1 Earnings call transcript