LLNW - Earnings call transcript Q1 2019

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Operator

Good day, and welcome to the Limelight Networks First Quarter 2019 Earnings Conference Call and Webcast. [Operator Instructions]. Please note, this event is being recorded. I would now like to turn the conference over to Dan Boncel, Limelight's Chief Accounting Officer. Please go ahead.

Daniel Boncel

you Results the Conference thank Quarter Networks' and Financial XXXX Call. afternoon, for Limelight joining First Good This call approximately is and will being recorded on archived our April on website for XX be days. XX, XXXX,

to this by quickly be Safe would we Let me remind statements covering that on start everyone forward-looking Harbor. the We like call. making will

business and differ of reported strategies, Actual our as our such be Forward-looking all that statements fact product expectations, considered and statements trends as results statements, not those our are for secular performance. historical by beyond, XXXX and are operational announcements. and priorities, our forward-looking should plans, not materially strictly statements functionality contemplated future our outlook indication an results feature from could of

to in we date, forward-looking The information based any required please forward-looking factors most available risk statements as our including except to as information, are our today's obligation filings, on annual more report law. and Form by discussed recent us on disclaim update this any call For refer to on periodic statements XX-K. the of

call the Financial today Officer. Bob Chief Executive Lento, on Officer; our and me Joining Chief our Sajid Malhotra, are

available Bob to over end at Q&A the prepared remarks Lento. now of Bob to from We session turn be and will would during I call Sajid. the like the

Robert Lento

we as was GAAP in in of that the we were the our the away are in that significant We Non-GAAP second expecting ever $X.X a across net entered focusing million, Dan, Revenue plan. year was Results largely quarter and year $XXX,XXX. half adjusted heavily previously that net Thanks, EBITDA goals. foundation we good on not measures. results, first revenue would point at line of against opportunities year, afternoon. for who from for on a freed high-quality to low yield our in million. global mentioned our set latency, financial strategic point first quarter the the our a was scale, aligned million. first XXXX for our This and best the loss moved expectations execute in and we value we we Today, our results. We but announced many video quarter with high believe capacity and was our continue and move we value were $X.X Last loss reasonable mark with customers scale. $XX.X up would operational quality strategy services loss low expect customers not price and XXXX. global financial to did invested

renegotiated capabilities. are contracts quarter quarter long-term of financial largest conscious success We but of positioned we year, also many high-quality which better customers, this successfully to for a growth with These video our on as the delivery in revenue the our impacted believe last are many we compared decisions result. now of first first year focused of and

Ericsson. strategy of part As QX, with this announced the partnership strategic we in

edge of how XX business more service cloud We point continue the networks. work presence the on our an which on Delivery changing we This model content is service with and Ericsson Network, provider delivery UDN, platform plan within exclusive to execute providers. as our local Unified provider partnership than is or capabilities with of

Germany, the their with inside delivery the in revenue locations to Ericsson and of including believe with with have some of in existing very the opportunity their at to Limelight's the beginning converting across already year, sites adding us to looking we a networks. Global we're had in generating And providers on. at Thailand, that Australia. considerable world. X future, They operating we are Mobile for our countries, in also World our Forum last present the many Edge and additional met software. partnership forward Congress Brazil, executives, I working month the the of changer a interested pipeline XX and of Colombia in were We Mexico, and Ericsson Since locations half have to significant infrastructure I service for us partnership representing Barcelona. I will be C-level largest capabilities second this game are XXXX continue Ericsson, beyond. converted

that addition of locations, capacity to customers and our the are to initiatives. through and support our to new expanding In key Ericsson network enhancements continue on our the footprint of expansion software capacity conversion added through we into focus locations important

our increased a has Our global production, software least team and throughout be by rollout drive version capacity that We and of network will this complete. built, increasing at throughput. year, XX% new performance this deploying is in R&D once we will anticipate

an pursuing network important building that also are geographies in customers. new plan PoPs are includes We aggressive our to expansion that

real making Additionally, network-related investments key support initiatives and streaming. time we're edge specific to better like services

We Customer acquisition to growth our distribution XX% good across with efforts expect these the drive in future. have up was impact positive customers revenue a year-over-year on regions. and

Tom revenue result, a customer global momentum QX. our As was was sales of plan new ahead Marth. leader, by in driven This new

his to drive the sales across expect progresses. We as with and success pleased year date, contributions more are to his leadership

stream daily added During to have has the Major its HBO, content that new onboarded deliver basis. quarter, to to to millions on viewers globe. we Limelight Baseball, drive And revenue started who include Two customers we League across a the growth. several great games of expect we significant examples where

strategy video Apple to services. latency global OTT video-on-demand announced a Disney offer companies low like scale. like own their As on high-quality to their on our grow, these subscription-based further decision have our delivery support believe continues events focus intent We and the to

capitalize opportunity-rich are an to these and trends. on well environment positioned are We

in many we the share We expect more opportunities, about near are to excited you with these future. and

to we XX% QX. As our we on delivered over have in made we was to events their that satisfaction record during major quarter, traffic record deliver evidence than I the the set third had pleased am customer traffic as in ability of few see priorities, experiences quarter users. these progress trusted of of Traffic customers our continue high-quality higher our end previous XXXX. A and to improving biggest they

XXXX. this momentum We to throughout strengthen expect

in see industry's degree high solution our announced global of Streaming, natively interest real recent time a last to show is that addition browsers At Limelight streaming first video and won Vegas, X for continue is in Las in we We live scalable supported major the X subsecond devices. which the NAB the IBC to product, we by new won awards at year. this recently

all spanning many We others. regions auctions large in gaming spread are betting, seeing broadcasts, and industry online and sports, from interest

some streaming in So far this year, of with deals of customers already in process we several real onboarding. and time others these closed the have production

customers our establishes edge and continued excited We're growing services, revenue subsecond this potential, edge this in of our a at number and as of infrastructure industry have our leader of and in delivery. are address to continue low pleased strong offering to customers' in the a clearly the first needs leverages growing also and we which number level We service connectivity. closed latency In global phase. the video new through the Limelight new have deals, edge progress that quarter, testing a with we pleased pipeline. about and interest We're

Palackdharry expanded as leadership hiring our in by As announced this we in Mike Solutions. of Senior Strategic January, Vice President area

performance growing with year our largely quarter far summary, pleased momentum edge our expect accelerate market. the line financial contribution was efforts of In in his his new this services expectations. and XXXX in to so in first We and are the with

multiple was various with momentum Our both regions, new partnerships. and customers, activity across our progress existing multidimensional, much all product and lines, and

XXXX confident now be first that us, will quarter the fronts. remain year best behind I With many ever on our

Mike our DiSanto our this equity at As for chosen a year plan to of meet Sajid, reminder, salary our and on based the that base undiscounted prices, I year. announced replace confidence we half to market previously have with

of in the potential opportunity-rich to we as We the conviction and ensure serve of demand we well our second positioned have heavily beyond. our team's have the continue second we to ability on We to the in to XXXX we are our that anticipate to our that strong tough we execute comps business in recognize invest growth see quarter, capture half tremendous environment. again management strategy, in

turn expect of the strong growth industry we contribute We in second future. greater discuss we deals guidance to begin performance financial And quarter traffic expect Limelight's for first. half new and in With as be my the been global the generated for team to the as at stronger the than call first as XXXX XXXX. more second and to I've am like revenue our financial detail am this pleased to I our right decisions the believe never and yield the and gratitude that, I efforts shareholder our meaningfully work Sajid? momentum performance the market and We would results, the to will hard moment returns. quarter have to express and above serve with I'll the of excited performance. Sajid over first translate our into together they quarter. about in sustainable

Sajid Malhotra

Thanks, will QX not in my revenue was a Bob, the I was I am comp low and these with about what excited momentum million. and to reported it XX% down by in good first of most financial remainder little quarter. off tough expectations. $XX.X bring. came a year-over-year. time business first the address you with we the afternoon. a be first roughly our revenue, later, about items expected QX quarter, seen activity I in and point, Limelight. me bit last a of in line bit of measures tell year this will Starting have but the year, from with revenue level let Coming

in X%. headwinds approximately to exchange the almost $XXX,XXX, Foreign quarter amounted

working During a by has the now superior to major with U.S. long first time and our all quarter, trust It their regain and performance. reliability have are almost demonstrating onboarded we broadcasters. taken

in accounted revenue for more beyond. fuel total we remainder a with these to opportunities of fourth quarter of XX% several growth with QX non-U.S. will XX% our other customers this believe our along with Approximately of market and XX% year we they work As will was XXXX gain continue currencies. denominated share International to revenue customers, ago. for compared dollar and us, in the

XX% product account lead top higher We would Streaming, customers as network counts with innovation mentioned emphasis XX% evolving Limelight our believed compared performance total last last in to Our real on as revenue customer out approximately XX year. our compute for well we XXXX. time marketplace quarter, of edge to

years. our are This We component also are in X is growth a over levels of the churn revenue plan. report levels pleased to lowest at

We and sales customer an to revenue lead that expect management team instilled year. new this increased contribute and growth procedures our new to will discipline count, the

on Moving operating to expenses.

accelerated second gradually revenue quarter, expense, creates capacity During half demands in will first of be second plans the coming by traffic offset we which adding to we serve see quarter, the our will capacity capacity. added and required This by ramps. This added expansion the XXXX. network traffic as be

second as the first end the from per of terabits Our the egress XX of end quarter capacity almost XX% has last reached first quarter, up of year.

quarter income $XXX,XXX year. a We of pace to per compared have conversion we we basis, our and with income progress at securities $XX.X expense implementation, reporting to other And UDN the the basic first customers due late had million QX and over last of decreased this expense. quarter. revenue the compensation. items. consistent GAAP breakeven XQ. flow up of also expense income loss lower million and year. pick to planned to invested share EBITDA was this combined the assimilation and these to share for XXXX. are due testing, and cash from tied $X.XX in the begin our first in the year, $X.X on Material increase a marketable of lower to should quarter $XXX,XXX website. Ericsson Interest decreased expense to PoPs. expansion last sales employee litigation-related lost G&A netted in these Adjusted of On end of Offsetting was assets by $XXX,XXX marketing per We and an R&D expect

quarter annual We the and first the operating over capacity. quarter as increased cash spend be million highest capital decline $X during usage in expand expenditures in We terms higher CapEx quarter year. to network balance. activities we Low cash the QX caused for the our the bonuses, refresh of expect in revenues, and payables,

to positive return XX-day the the balances last we end from between end XX flows to of end the end last quarter to cash of some customers the the of in expect and quarter, quarter. DSO at compared payable range. as first DSO their days of At that normally We year second days manage expect was the operations to We at year. see to appear the didn't XX- be XX at

settlement, under sheet announced lawsuit we and payment remain remains our Our very month balance continue we to strong. This made debt-free. to last the previously Akamai

XXX.X XX approximately to the our had we increase The the XX, end and strategy. of million year. March shares additional quarter first primarily the of outstanding. was from at up As personnel count last of end the is with quarter Total XXX, sales employee consistent relates

numbers continue We the G&A revenue to our should to functions expect year. add Employee for targets count to to remain these and meet stable.

Moving to guidance.

record maintaining are to across year almost all previous our measures We guidance. expect be a XXXX and financial

expect We $XXX and and of continue million. between $XX see breakeven EPS between of We $X.XX to Adjusted range non-GAAP of share, $XXX between in $XX of and the revenue per million. expenditures in and million $X.XX EPS capital GAAP to the EBITDA is million expected $XX million $XX million. be and and $X.XX. range between

for the ahead At foundation of the same our low there related achieved close us offering. For point guidance. deliver this gaining and and plan. in recognition, in nonfinancial slowed speed. were our significantly, reported receiving our full slightly streaming many onboarding results is many, The time, customers to laid revenues and we targets and Real profitability, customers to plan. headwind year for that against the were or operational new traction very XXXX expected declines was QX be industry-wide is strong. time conversion are customer from Ericsson to has Revenue is

number to us our regions allowing is and in latency, we with engaged expansion quality footprint of lower edge higher countries a Our serve for offering. are deals mega and and

growth get the unlike the give progressively will with guidance, While trend, and the revenue anything quarterly experienced we momentum. I quarters three remaining be of do last we've and believe expect year's we not sequential better. ever in reversal increasing to materially

beyond. revenue base that up for and half of first set from assortment half the than well revenue be second year, last a of a bodes this a expect XX% and We could This higher second product and stream XXXX half will customer year.

over over year, added XXX revenue the the should to partnership. as now Additionally, that in of from We start delivered the expect available with partners. the being incremental and second of we network, accelerate made have see to half Ericsson year we the points to presence buildout our within the we of by Ericsson capacity the end from increase XX

plan. up execute our With we call continue are and excited we'll to questions. your So against that, to open Operator? the

Operator

Instructions]. [Operator

The Turits first of Raymond question James. comes from Michael

Robert Majek

existing do can from revenue million revenue there midpoint from $XX This or of growth on how get in Michael how is buckets? Robert have how we full the Majek hit guide, from How deal? you in $XX ramp to roughly you the actually or from of for to much $XX partnerships? to Ericsson today. confidence much target order have QX from is here? and new products one In you up you is QX. million-or-so year in And just in the those on hit million that Can bridge much is other then How each And visibility your customers? much us

Sajid Malhotra

say that to giving the components. us So gives execute point. something is have fair business the But that the momentum and the broken we by out we're in confidence not have, trying revenue we're the we that guidance against this rate that plan. different we the This have at to that run

slowdown QX, imagine, a you quarter and and that high standpoint. rate establishes the from think you of in have where be case little the higher business As QX. a historically, year. run this a it any can that at we the seasonally We of kind you look would base QX QX, should bit And exiting if be don't then occurs

experienced say and be QX, me from QX. up to fact, would which to and significantly on quite QX into continue be different historically, as In QX then to what heard ramp we earlier, than we expect you higher

as and Ericsson plan. along in in should overall the I with terms initiatives, digits said have single far high that they other goes, As contribute the the of

So even Most rate. we're what the that executing that's million that's $X combined what somewhere at what initiatives from against. revenue $X between grow coming second in expect. the faster kind half second And causing the and and an is million is to we that half. on of expect, we that's of And

Robert Majek

one me. just maybe for And more

You bit customers? streaming touched in real can you've remarks. initial had on customers the And product, about and traction a tell trials converting time whether the any us But the use cases to you're prepared just you who targeting? it pay

Robert Lento

So Bob. this is

to the adopters sports early the So betting tend be betting, involved companies casino mainly in but also and betting, auctions.

perspective. QX. the were so depending deals where -- closed ones production. early Several an is of adopter the that's from have customer, seeing some And the of in already initial the And on size smaller gone of those into traction we're

some larger capabilities slower. at ramp the side to the would the I point. caused Some that ones strong But be build pipeline say, the on is, to of this need player very

have many than trials. did we We doing we close expect in more QX QX. in to customers And

Sajid Malhotra

customers And production. in we have

Robert Lento

Yes.

I As some smaller production the into of said, went ones very quickly.

Operator

Charbonneau comes Jonathan The Cowen question from Company. next and of

Jonathan Charbonneau

is up. an out driving in as you more You noted for change anything fix? you're that Is there And to from perspective largest particular would you what broadly any customers DIY a has from doing is Both industry demand that there seeing that? been guys? well as picking your call

Robert Lento

of haven't the any we So on DIY acceleration front, seen that.

the of not We're also that. built last seeing capacity them over seen years some that abandon haven't We themselves. customers any few the

of the Limelight to would largely I momentum and are seeing change both A no So that's industry. say the that there. lot is specific we

is industry consumed devices. connected more both Internet of Internet we an and being more connected devices on and through seeing from available are So content that perspective, the broadcast the through

either through HBO of HBO last first came that users number and a NOW. had said the Game HBO GO after was they it Sunday watching think out I of Thrones record or

think, more Bowl, more they users well that before. ever it's sporting seeing saw that, whether regarding online as that we're CBS so said more than I and of events, And Super

so, we're it English who Internet that think, the Amazon League fact, devices. Prime was events And good in in And starting is now A for the year. available obviously, some example more to to of given available devices. be Video through only that fall we're And announced they is, and of won saying Premier I Internet-connected starting publicly connected see are that only through that. rights more going the of this are,

are it the to are of and of seeing number So, concerns and broadcast-connected I devices in than on more that the terms devices. -- preference consuming think more offerings available, we user growth shifting different

And direction. in industry so, that the think, is moving I

Apple Plus, announcements addition seen But Disney You it examples. and to with Apple have by is the plus then Limelight of with in specific. Disney that, further some

So the customers Limelight's in for that onboard through there and that year have network. are cases in content to first this been moving years some we half significant of delivery expect traffic we talking to start

about going. here we're said users. seeing solution are we excited Limelight prepared in also comments, part end about their trends -- as excited include in macro as that's So But of the to I we that and as to today of industry customers about willingness large the excited for terms my where we're their the satisfying we're the sit

Sajid Malhotra

add, embarked on let multiyear me we a And just strategy.

was So the and X to said we or focus the were of we want That X that piece business at in, of years of on large video. file and looked gaming kind it. ago, software, we CDN

video-on-demand live of the video. we efforts as course and well the as suited that, XX are last and for stored video, said best within XX, Over months, streaming our

the is are went of the is path. of think, our we kind of focus, bear that and what business. to we that seeing where result investment that finally and And, coming today share down getting So you're that emphasis that I

next latency. that around as of forward, think this we you go is Now the journey leg

as the and And effort we're bring video within lot as reduce spending to time decisioning well to to of edge. a latency energy so and

on. this where think we And market will we there. be going, the differentiated So that is we path that's put to that's in see markets the and the and we're we continue effort can why those

Operator

of Davidson. Kelleher comes question Mark next D.A. The from

Mark Kelleher

pricing? us a mentioned under dynamics some Can the just be tend record on sequentially, you're certainly give in gross you pressure, yet to traffic you and amount that there of and both of had the gross quarter, Has importantly, what change in You seeing some margins gross rest your and year-over-year. the philosophy how more your as trade year? what any competitively revenue margins margin? been for in terms for to expectations And are

Sajid Malhotra

thanks. Mark, Great Sure. question,

we low for in of point -- First we the all, think gross year. margins the for to the expect QX be

of in our So we just And that, here. what plan, experienced. what we we that's know kind build that's had from

I it Second, the denominator. is think, partly

you when year. about didn't decline et That second driving this you our That for much, the changed see cetera. So that the you year you is line quarter stream see And the between by really with a if some X change of in have when et -- quite in last kind the but that bit year, and we gross talked recall cetera. revenue costs part. of our margin had last repricing large most major customers, impact, under

of changed were So are a is that It has we not where we and pricing journey, this much that of so changed, unique an much has to today. where and industry us, as and is in a sudden all lot.

the expanding same a at QX. and quality. to gross keeping coming for know not our QX, answer. gross margin reducing gotten we we expenses downstream better with by to what's and up costs bandwidth didn't a We and time, and cutting QX, So But margin in optimize have could try

invest maintain have, and So beyond. have -- for we we need for what to QX we what continued QX and

set of try a guidance. ourselves. why don't so gets I and for quarterly this which of to And kind on it's bit the story is year results think in And we numbers instead the little to that we against kind And focus of the the mismatch. of quarterly deliver full have this heart a is part

Mark Kelleher

can that number from up But you here? gross margin step think

Sajid Malhotra

to. has It

Robert Lento

Absolutely.

Sajid Malhotra

the of here. consistent get long-term this with will what is terms It from need in our plan we point. step low Yes, up to. it is And to

delivering on against we're focused numbers. So those

Mark Kelleher

those in Did Okay. PoPs And you revenue Ericsson quarter? mentioned you contribute online. XX the had

Robert Lento

through Not the a They amount. on quarter. came meaningful

revenue year. meaningful of on the half, providing half Ericsson second So in the again, we're focused back

can we to ramping everything imagine, up that the the I started that you sure slowly and with sure smaller We're properly. locations. environment, make traffic we fully think, understand make as set is

tended the the will But in on to and we us them we help on than future smaller of this going second be slower the they half initial ones ones, year still both we're with believe So will that ones. the as side other of our and is as revenue. cost well remember right? -- the of side. it part and our our two I revenue this gross the effects If the effects there of it affects One margin, deal, part parts

Mark Kelleher

Okay. And last in quarter? question, were customers there any XX% the

Sajid Malhotra

as Only time, is one. Same it for has which Amazon. some been

Robert Lento

to Amazon Prime Video, specific. be

Operator

The Riley of Sameet next question Sinha comes from B. FBR.

Sameet Sinha

of couple questions. A

sort talking of industries the kind of seeing you online about? of we you're if other to you have What pointed edge are Limelight's you about because As video. refer industry of can spoke -- mega are talking mega And what that computing, of about you talk sort Is just cases? been, used Secondly, about you specific trials? growth some and trials. you out OTT forms

them? now you traffic a what you good that of the sense all guidance? us -- broadcasters are ramp any it of you. sort about a probably be for can of working carrying kind DIY versus of just your you basically it with solutions? traffic sort go have of Can the expectations third-party what And in through that your in-house will to about speculate think lastly, are couple give you And is you done XXXX As over CDNs years, next percentage being the through tailwind on hear of

Robert Lento

admit and could the at was And all first me that add stuff Sajid because catch down. some that, of let take a didn't second writing question I I'll Sameet, I crack on. just

QX, customers. those are So mainly would the it's customer. QX of large is what there there will matter that and ramped I quarter. customers a individual on a And comment third that fully we the the environments us be any and are through you the multiple last of where ramping are on was -- don't by question ramping Obviously, tell are CDNs. then But

on as market the OTT market quality the based in and us So well providers it's about growing share maintaining themselves as OTT winning share space.

we generally third are speaking, big progress as They so least I on lot a pretty that Limelight. been ramping fully have have quarter. and And going where into been some now, of good at provider, not they'll ramped be long the as at I expect names

was cases. question third use on The

the For we're of what on. working kind deals the we that call mega

of that the so ride And the purpose idea very service will whole but partner infrastructure. themselves Ericsson we purpose, relationship embedded benefits on strong of whole is even Ericsson be -- the edge not would to strategy we And IoT are that because be the we developing inside the the than would was this one closer of networks. the today,

case. use we low big one the that's extremely user So other maintain is important a But in experience. gaming latency the we're one is, are right seeing to

and can because everywhere low that ones seeing was? close the So we lot the to provide those front. big X then And IoT, the second world, seeing interest of gaming And almost latency, on everything edge are as we're around we're which in with a fits Ericsson. the are question strategy the with

Sajid Malhotra

video. and OTT third-party online Just

Robert Lento

me, right, when it's to So you...

Sameet Sinha

of -- in increase basically WarnerMedia, do them in-house services, traffic? was I this Apple coming XX over whether all next as of much by am that just -- the would solutions? How What expect, months. my see question NBC versus Disney or CDNs or out be it's we How you third-party carried OTT

Robert Lento

not I on Okay. competitors. large capability. their capacity their based that own discussions or and in-house that majority, not will universally OTT having with CDNs" like having, the the and providers. "third-party majority traffic that all by or But true. And handled certainly of Limelight cases, our traffic believe see own the That's going companies through of discussions all be I many in mean we're we're major obviously I

good on OTT it's are think, I capital I takes industry. out of So for trends the the software, the the to to very, time interest it lay And don't develop part industry. the see of and lot own very a for the develop The strong of And provider to anytime abandoning and the said, people talking the to have and the that traffic. in-house Limelight the don't at companies, of as handle are people I questions, like majority I the also capabilities. that soon, some earlier are in-house companies we Limelight to capability one that that looking see but their

Operator

next Rhee of from Craig-Hallum. [Operator question The Jeff Instructions]. comes Van

Jeffrey Van Rhee

me. from Several

on I think side. maybe just the EBITDA first

think you think, the I context. understood revenues, maybe as I commented the a you of referring were couple I largely if quarter times, expected, to specifically was

you to correlate where that for expected it if Just would EBITDA, you quarter? was the that

Sajid Malhotra

but our But a landed were in line we break a out, some plan not behind. of in kind break line by item with up, quarter I budget little at generally elements what line bit were did were didn't and as bit where out I forecast the I expecting little item. roughly some looked line. said, we ahead,

Jeffrey Van Rhee

Okay.

So both revenue fall umbrella. in that EBITDA general, referring under would

saying? I guess yes, you're So is what

Sajid Malhotra

Correct. and share. per Margin earnings

Jeffrey Van Rhee

Yes.

of Okay a on some S&M, there's in -- sales changes million up revs. but I the know incremental or sequentially dollars. down then And couple

little year sustained talk likely versus a How now you can just So the a we ago? that What reps quantitatively rate more this Is that? is forward? about think incremental how spend? many do going

Robert Lento

it rate forward. I likely sustained mean, isn't going

grow lot a team even marketing we'll after. in not and latitude. numbers. that than terms market. But year we, street XX% some We -- today customer bit are, build brought to And at have in we more And, in a Tom year. market. on. Albeit, than nothing our him the gave We on of think, the going of But dramatic. have in the this the of the big same feet more we probably salesforce trying before we of we're terms came -- in cases, Obviously, I Tom many last this see round did on we little out. time is this very range through that year very, focused I somewhere to think, spend, cover the And some competition have last board less had customers a

not sales are the doubling But progresses. We year that and spend. see spend increased we'll marketing area in as

Jeffrey Van Rhee

maybe that your like Yes. And just the Something Ericsson. of of capacity, of it performance, you build, of bit on Capacity, in give networks. Was I aggression on, you that seems building that? else? was sounded one the inside driver? The Ericsson upped remarks advantages more the be know little OTT? being capacity may all networks? a like color you're executing prepared what incremental capacity kind your quickly that X on Can outside better Outside past confirm pretty which

Robert Lento

So answer you're is, right. the

two doing are quarter. X.X next we've that And will We our the designing change generation We're take the of building end year the this completed, is And that One is at capacity. it more of exiting software. believe completed. XX% or ways. And that us is we what to global least outside is, get probably the will is next it spent doing big capacity into when in making basically And efficient. Ericsson. through network servers production year the going add that of

out per that So are second. they pumping more

returns us deployed great that use a way And better for that. get against is to so that's on capital of the

coverage some much diversity through it more in And get had got and that's that and our go. so doesn't big a give everything to even or been his some Kurt location, just a plans makes to have you where where we what we too customers we that, single it more to then get need And Silverman locations And innovation to team we there. need locations working but does, have better are redundancy, in efficient, on. asking have diversity because you us addition already have going that

in the with adding Ericsson, doing some So advance it's capacity are Ericsson then software-driving what geographic diversity of and well. as we are we capacity, that it's

Jeffrey Van Rhee

guide. me the Okay. sort then annual on the visibility Last the guide of one about to for question

several over you New last what's capture, customer respect customer capture? retention, talk record and new to a just low with a customer forward you great a commented I to for of Can up the new somewhat You've years think, territory built you. that into churn. done job guide satisfaction driving

new a on success new of effort? sales, got growing You've sales from reps. head new the you've got How sales guide the dependent is you're infrastructure,

Robert Lento

have and I our continue successful. majority been risk, existing I I it And customers Sajid. don't that are and mean, to either turn over it mean, to coming right? then one have from onboarding. the play customers will make I down customers to closed So, want But of or large to comment is be

on need always We are have us with that them. it be schedule want continue way and that to. ramping, happen sometimes And ramp our to to customers with to the doesn't we successful they

But our got want doing we have and are, obviously we that. more risk of so keep that growing time. have elements customer And we X to with history than existing the at is a ramping customers, a

process sales signed some have onboarding already with a especially we're here customers to QX. revenue, make that we the force, in of deals, We -- more obviously said, contribute then very material our in and we're April, attractive that has strong enough in deals them. relying as And which pipeline but are lastly, in are QX, large close difference the they to will a in on

every And we so variables those manage the that day. are

Sajid Malhotra

try multidimensional this, from Jeff, And to about So different few it talked right? attack we have is a this and ways. we

example, And to again. for reduce us growing important For to count customer the churn. the customer it's get

the is $X revenue Now it that's of in the a about million. $X.X past, as million, declining, headwind,

I board, these we addition, high on said, that In all have we that's, this initiatives from revenue coming single have. digits

$X can million of our to you you the initiatives. $XX guidance. million, between $X.X new that somewhere million add of and if eliminate the $X million million, need $XX these $XX say, midpoint let's million from to of get the headwind So That's just

business we're out base just is the get the growing. business, way about That's million $XX thinking against other trying building and the The done. business, job executing to business, the the

Operator

Malhotra any the concludes to like Sajid I turn back conference would our for over session. remarks. This question-and-answer closing to

Sajid Malhotra

Thanks. Yes, couple have of I closing a remarks. just

are I free growth trends increasingly and growing the rates XX% and cash projected set based are believe business comps again, on want, strength trajectory. on type XX% But improving. that profile flow based XX% think, we're customer plan, with and We and we And model based on that less So target. confident our focused of traffic capacity on is CapEx. the in a and today, long-term, capability, we EBITDA momentum, we

capacity entire use There's lot a software in infrastructure of We the a core efficient. and as are becomes capacity. capability we more investing becoming available and lot

similar. Software and efficient the efficient. make economic same year, is million terms see $XX opportunity. making real more time very traffic then $XX months is whole too. the a to record with unique XX% physical entire with period. to At across more very capacity XX% million company. of we'll and I'm sure more This capacity becoming time, only capacity million add capacity available $XX spend you We'll Ericsson. it from CapEx to is deployed year, the infrastructure over spent between software something attractive available there XX response. do and a And in we delivered a Last XX and customers, new is great at streaming Edge there transformative getting momentum is great to

can handful just are size We the advantaged complexion of small because deals of change Limelight. a of the our and

Our will Street leadership very With are that, The next very And, feel our have look positive. that by numbers with numbers. been plan internal this changes this I year. different very, the and guided consistent time we think, company

interests base focused are Compared the equity. sign and confidence plan. are fundamentally what of looked And like our as to in business with better company better on to our this XX% outlook momentum. is We we Bob, the taking with salary a a Mike align made the company I highs, executing when and our of a shareholders, different recent

our after that, when we're expectation as again. available any you, call. in, answer call. we what So this we will we and get additional operator, always, report Thank we July. and you to report to the on this is And with against Thank are the progress conclude trying in questions

Operator

for now has conference presentation. today's Thank concluded. you attending The

You may now disconnect.

Edgio (EGIOQ) 17 Apr 192019 Q1 Earnings call transcript