Earnings call transcript Q1 2023

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Operator

Good morning and welcome to the First Quarter 2023 Earnings 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 that this is being recorded. I would now like to turn the conference to Nandan Amladi. ahead. go Please

Nandan Amladi

And call Sandra. everyone. to Welcome Thank the good first earnings for quarter Everbridge's you, morning of XXXX.

today's Executive CFO, With Dave on call President Everbridge's me and Wagner, and Brickley. Vice Patrick and President are CEO,

the will Before IR recorded which be of the of and conclusion section our a accessed release, This page ir.everbridge.com. teleconference Relations can website Investor replay market at issued be the call event. earnings our we of opened at available our on on is today's the being

reflects refer of earnings financial will non-GAAP We we call, Investor our not During XX-K, those we XX-Q website. you or projections SEC. such our our views to Relations subsequent release, A outlook. Forms and the well may limited as Information in measures statements call, call involve during the as any our not will statements. today's reconciliation results should filings can that regarding but to, provided certain make from obligation of as of risks future the today's company and cause described forward-looking which in Factors date. discussed with and might events considered uncertainties. measures. other our such or is financial certain press included of to as subsequent differences our this non-GAAP actual materially the statements today representative GAAP in find The disclaim company's on update be any financial performance our any Also to on forward-looking are perspective explicitly of only include, differ that

we and first our our addition outlook. results earnings After the we questions. highlights, press for financial our business quarter XXXX of in release will call to Our highlights includes and review financial open from

over turn call Dave. me let that, With Dave? to the

David Wagner

this the the Good morning. everyone of results we welcome am for first with earlier pleased Thank released to financial Everbridge's call you, Nandan. very and quarter I earnings morning XXXX.

an $XX.X For the annual X.X% $XXX.X million is XX% from of increase a adjusted million first achieved $XXX revenue recurring $XX.X year which and EBITDA million, increase revenue of an and million quarter-over-quarter quarter we $X up year-over-year. of million, of year-over-year; of ago;

XXXX keeping we continuing organizations customers us our evident that of It to across in XXth some partners brand. day in improve execution restructuring are we opportunity our is In the as running. York officially the results, anniversary special and to our company's our our financial impact was of and with The had the New celebrate to quarter, City allowed we unveiled and Everbridge’s people a safe commitment to highlight our longstanding organization. Evolved

two company's captured the decades since share event billions a of market of and reach market people the we've globally. scaled inception, our In critical to platform the leading management

customers, the of XX use count honored X,XXX countries as organizations are to alerting our systems. for us who We including leading world's their countrywide

keys success instantaneously a event of is our It offer resilience has ability millions powerful. the of when platform that people One to occurs. incredibly comprehensive is notify nearly critical the a to that we

several aware, was many of It the are an error. very residents State ago, you being a platform. Florida weeks to was that emergency As many in software leading out an failure The was of alert procedural result phones not likely occurred of sent listening morning. the early today human our alert of incident to there test the a

designed delivered the message That's system good as instructed. the and Our software news.

and ensure and notification phones Emergency broadcasters. is to and to to our was to the with live to news partner, Management are continue of all residents to Department residents’ Florida customers sent the to regret Florida a committed this test of applied. Florida are are as of we of improve only as a bad sent of State instead of best inconvenience millions we practices message a caused The We inadvertently cell Florida

agreed We year through demonstrated of to our the early rescind people of ensure to the are contract that season. DEM agreement termination calendar this and Florida end the we with through upcoming DEP commitment protected the the as hurricane of further extend our

Our is focused job the We customers to as all on of one the core mission mission safe. globally. for keep people residents our and Florida remain of

growth million as toward in progress X% of $XX our Switching strong results, back on making and outlook we the “Rule confident remain solid delivering we baseline our our adjusted double growth goals Accordingly, digit year, to XX”. long-term for evidenced revenue to and are in we EBITDA by execute year-over-year growth, ARR growth XXXX. financial EBITDA the our our X% in and including on profitability

CFO, turn on now to our details results. will to our Patrick Patrick? the call provide over Brickley, financial I

Patrick Brickley

Thanks report Dave. EBITDA solid execution, produced adjusted and our I which guidance pleased revenue to above were that ranges. am

growth. that strategic As implemented program during pursue continuing Dave we as results alignment mentioned, organic we the to is profitable show XXXX

XXXX, now first by our for of recap and will quarter year. results followed second fiscal for the full our quarter I the outlook

to please of full our non-GAAP our GAAP reconciliation of details For P&L release. refer press to and measures,

first XX% to our quarter, year-over-year. increased the ARR For $XXX up million

X% $XXX.X all year ago, and up was from organic. a Revenue million,

$XXX well subscription Revenue in due for from in of of our to days from some as on non-SaaS calendar million, contracts. subscription as services X% timing also QX, invoicing services sequentially $XX a QX year was but from fewer ago, million down up XXXX

year Our experienced XX but revenue gross QX rate than We revenue performance gross down signed higher moderately with ago. XX the retention the still year we over below peaks, that notably that ago. remains deals retention in from recent was a healthy $XXX,XXX

in size what Our recent was in average quarters. seen we've lower than deal QX

increased of transactions and growth However, sales our year-over-year. volume new

sequentially is year. products, impact describing customer year and XXXX. been divestitures The is planned up of net count in the Our latest of by for total count decrease which the programs customer early we of X% and to over life XX end non-core down X,XXX since have due

of adds levels relatively otherwise During and normal churn. saw logo the first quarter, we

year-over-year. XXX up Our sequentially increased CEM to customer count up XX% and XX

a was XX% from to or XX.X% $XX On gross of a to million platform period. year million compared integration was ago, in compared margin basis, GAAP XX% optimization. growing and year demonstrating efficiencies XX.X% the $XX gross ago adjusted an profit margin

GAAP share million compared net $X.XX per loss $XX.X in year negative net period. negative of per $XX.X share a ago to loss the was or $X.XX million or

negative an net On net a adjusted $XX.X share million or per basis, of we generated the $X.XX per to we $XXX,XXX in income earnings which ago diluted share. compared period of generated of or $X.XX loss year

XX% from the margin. million $XX.X improvement of EBITDA million adjusted or was represented EBITDA X% a Adjusted $X.X margin, a which period in significant year-ago

that our business in making improvements gross marketing, sales result across efficiency particular, we are to XXXX within margin QX and Our reflects substantial the ongoing operational and R&D.

free operations strategic we $X.X Cash adjusted flow our up cash million $XX.X $XXX up $X.X XXXX end program. QX result $XXX ago was to in cash at flow year-ago reported period. the from of of related ended year payments was cash million with is up for fiscal cash, million, and in from from the from realignment The million, million year We the which XXXX $XX equivalents million, $X.X restricted period. in cash QX Adjusted million XXXX.

our to year. full the guidance turn I'll and Now, second quarter for

We million and quarter, $XX per For approximately loss $XX.X $X.XX earnings between net revenue and income net million growth or million of of anticipate and share and $X.XX. $XX.X non-GAAP the between of a representing $XXX second million X%. $XX.X $XXX.X between GAAP we diluted million of anticipate of million to

We G&A. $XX.X of $XX.X to marketing, as continue and operating and and R&D particular expect in million be areas EBITDA to efficiencies, adjusted between sales we million in drive the

in we the as million unchanged We remains guidance several representing of over of continue year $XXX X% of full range to X% areas $XXX business. the Our to to revenue to be million, optimize XXXX. growth anticipate

EBITDA between or $X.XX a in and $XX.X non-GAAP level, in net midpoint. and adjusted to $X.XX share. loss At We anticipate quarterly XX.X% of $XX.X We and high adjusted $X.XX million per adjusted million the $XX of margin therefore of $X.XX we income reflects roughly EBITDA million at and GAAP of expect basis continuous negative EBITDA representing On EBITDA per a $XX.X outlook will a expense adjusted $XX million, this improvement the net $XX.X quarterly between to expect an and be between million million, share. range margin. or flat

a delivered year. off the to we quarter summary, In start solid

progress execution, on organic profitable driving and investments. maximizing we growth XXXX, through our return on we remain focused As

XXXX we believe further, Looking Day, making XX laid December progress out Investor can steady by towards we the Rule our at deliver the targets XXXX.

That call concludes my the back now turn over prepared I'll Dave? remarks. Dave. to

David Wagner

Patrick. Thanks

recurring in our had XX% business. a quarter As demonstrates our in increase year-over-year solid ARR we

deals retention an down ARR eight quarter the In closed for and growth from gross the increase were bookings customers, XX XX first top over to CEM XXXK respectively which XXXX, deals and in XXX. under of came over especially XXXX. added XX from quarter count deals performance We from period XXXK, our customer and steady new bringing XX healthy CEM Our CEM XXXK. total five the we was from deals during XX wins. customer four of All recurring new QX

port XXXK. government in the mass was with and deal. were new fifth the in perpetual smart which and CEM notification in all East. included an was were under Our two the enterprise a Middle They top five vertical deals, accounts third business of authority state government three in States, security the quarter the a One the deal, United

during QX deal down. XXXX, From and strong as of we easier new of solutions, Our presence average on-ramps are new customer full digital plays we purchases sales which consistent total as our built was the was both sales rebranding, executing to focused our including number with foundation our point drive web CEM logo refreshed well cycles. deals but size programs and provide sales shortened the

and top in quarter add-on their we reducing of cross-sell of plus a deals medical to as U.S. during awareness, plus value acquisition an and contract the a to customers bring company. million end, million future add-on $X upsell five will their incident. we the communications notification our $X growth to time the insurance government included a lower crisis, experience turn, U.S. improving and increasing to that during large quality To for cost In the the and situational allow

enterprise growth the verticals. three in add-ons financial CEM top remaining pharmaceutical, and The services technology deals were

add-on number the deals was from up Our QX of XXXX, size but XX% than growth deal down. was more average

Norway and our six European different Kingdom, six Spain, the around countries We successful technology Estonia countries to bring world. of United the XX in a Germany, Denmark, warning in the over total deployment wins months. us The also of public recently past announced

combined implemented Everbridge public several technology XXX inform tested Within the country months, each the a than residents. has to and past and more protect population of safety million

Now product. moving to

more and are in context so efficiently. solutions ML are that improved our AI customers our We machine and tooling can deliver learning are innovation we risk AI portfolio. On-risk our technology leveraging and relevance increasing across delivering we intelligence integration, innovative investment and to using and our analysts

enhance to advancing resolve digital And continue that incident we're quarter, AI and understand also enterprise steady making faster. root delivery progress the improving which speed launched for experience user incidents insights customers. integrations both our product to We last outages uses to our ML our cause ops CEM and into core platform, of enable we and commanders of

the Our strategy critical is to management. event end-to-end provide solution most comprehensive for

of workflow. customers and as see the our simplify Over of user the will streamline series improvements we and course our year, a interface

Officer, on experience align background brings an flexibility. a grade usability, platform and Product Bryan focused as from felt His emphasis on in has creating Chief shared architecture. platforms around new Our product he platform already and enterprise and modernizing vision we acquired rich a our being been reliability assets, is Barney with

goals. to first adjusted our achieve the growth delivered particularly the start flow. as quarter strong EBITDA on solid These track our sequential summary, to cash another in ARR results and operational us marked long-term have In and year in a financial increase and we

we resources to a place have in our through growth forward building focused quarter, strategy As get I the progress and way team, quarters. coming are $X a on billion ARR, consistent our a and look you there. we move to the to delivering updating in second on profitable foundation on further we in

We're now ready to open questions. the Sandra? call for

Operator

ahead. from from go James. Alex Instructions] Sklar Raymond first [Operating Please question The comes

Alex Sklar

implied million terms in in the you. data Florida's we guidance? don't Thank we within know still QX the historical X then your a seasonally Great. kind what's kind QX, think of versus on should ARR the slowest of ARR? And if I have included Thank you. clarification in terms also sequential growth quarter of being but Dave, just about ton of of

David Wagner

Great question.

healthy as think in We quarter. booking. yes, would where of sequentially we the landed we about So and exactly lowest steady planned QX retention a terms gross

So good we landed spot. in a

where metric and we but timing based expected. quarterly there's is right ARR variance new still Our is relatively well as based some billings landed of we so renewals, on

Florida, state working work end on the really of happens And is December on that for the of happens the calendar for million Florida on are that contract the XXXX. it that, we're we not be next hard in still it terms hard we'll of whether the in in to X state In continue counting the year. but agreement really will based current it, through of of with whether in of and that recompete June or year,

Alex Sklar

color. And driving who but wants about deal this And that you don't know for Patrick in take sizes the about then David, the just are great one, the threshold you I rest what's or sub-XXX,XXX booking are coming Okay, can CEM ASP strengths. these year? Are solution? thinking deals how another then or below of those talk to

David Wagner

Yes.

consistently unfortunately size deal is board. the pretty down the across So

but on size. going ads, was more sizes. the a couple customer vertical particular up, of the volume deal So current being the technology with organizations. volume smaller are a and know many in The that think about really macro we the the in business there. careful reductions headcounts consistent has existing new of with customers was things terms environment We smaller and little also base deal There in was deals about,

pretty marks. smaller in in my heard So you that the and chunks, introductory of – we're is smaller first seeing piece then after the consistently end buying the across kind sentence second of

restructuring XXXX during reduced – have we're we're The the over XXX does impacts quota fourth including reps. that working quarter that We bearing through. program, positions

the we – XXXX really made a and to reduced priority. on we're we've entered we some focus as So got changes as to intentional ARR a adjusting resources,

right subscription of so nature the be sale. their meet point customer and sales focus to a retaining focused on solution to model to where on how for customers And upsell deals, willing of And in know, with and tend larger transactions. the bring sure deals, just CEM on they are, cross way them as have we the perpetual sellers full being meeting a and you the making the is the the and they're focused

some well as we've So slight XXXX, as in going things transitional here headwinds. that got on macro

Alex Sklar

for All you right. Thank color. that

Operator

question next Canaccord from Walkley ahead. Genuity. comes The from go Please Mike

Mike Walkley

go to just the how margin hitting wanted Any about Great. on I cash is follow Dave, Thanks start the followed environment renewal, opportunity incident. of a do market and up target. with feel to changes given some other states Florida this like plus go competitors position as keeping your they share to and Florida feel with after competitive you in up an try some event? from to your you there's

David Wagner

Yes.

So and looking the I expected we am as in our would be best of scalability, platform the certain of that news to delivery and market. take throughput good advantage the is anybody performed the competitors this, have again

really of national we strong. we're is that really strong, learning, our Everbridge really in Florida solution. think of from And our so remains and that success success supportive The in Florida feedback many customers getting the within the

entire with great and of those to state going year. to Florida we're – of through the diligence course rigor the this service so And continue count

customers test process to it's and existing the we'll issuing messages – understand potential customers informing and both its clear of in customers we're need platform and customers, existing live the capability. aggressively our our messages, so working really be our existing that for pretty and And power new of and

is job new mitigate the customers off and the emphasize of and lots our expect do deeper with we of in market and our really going even positives this relationships out existing event, customers. of negatives the of to be scalability noise the our and building So to positives

Mike Walkley

quick Great. question. follow-up a And just

that wanted customers CEM that are on how where call choosing? Just you plans? about out the to you. – just any intermediate your force, strong execute now that you added And to sales to on products growth do sequential the they realign feel Thank are

David Wagner

is On the our for is you that. tenure force, thank improved asking thing markedly. sales good sales The

up a So over of XX-year The per is had of the productivity XX% even reps number in end really as we nice QX the year. sales QX year-over-year though of is we improvement terms end XX% wrap. down or and

albeit numbers that's that a the product in strength. our EXXX remains you So particularly to with is intended We're continuing product. that a real the saw in that strength definitely source a CEM, as part that the in strength U.S. smaller of – see as executing here real

Mike Walkley

you. Thank

Operator

from Matt question ahead. next William The Blair. comes from go Stotler Please

Matt Stotler

taking Thank one pretty on the in Maybe base. for deal questions. Obviously CEM you Yes. customers. follow to to, noted up CEM growth customer smaller but healthy just the size,

those portion seeing think you pipeline forward, customers, or new wins. touched you deals are mentioned, were five increasing just still from is that of an upsell new on how moving you this CEM in If forward largely of looking coming Are I customer the this health And top point? at that environment. deals new then

David Wagner

is very in I'd and We're Yes. Yes. healthiest the quarter-over-quarter, say we as would've healthy. sequentially zone. expected in down remains still CEM new largely CEM that upsell. deals, sub-XXXK the up remains pipeline It

– deal were. are the big QX deal they consistent large QX not I'm consistent sorry, – seems QX, the sizes QX, as So – deal where QX big as

for Our pipeline, broad pipeline in perpetual the include include mid-size larger the perpetual continue CEM deals is to in but and smaller does transactions. and balanced

Matt Stotler

get performance? love initiatives, be there that's incremental how channel channel. Yes. just And the update your an That's opportunities maybe in think about the on And looking the helpful. impacting on how We'd then optimization may one ecosystem – partner partner to forward? you

David Wagner

collaboratively And part or we on focused tie-in An needle. rolling is being got example a forward. & move in partnership of can global we focused with partnerships out of a example key are complimentary strategy workshops that the one resilience but of we're since think really partnerships our enterprise those workshops, to we're partnerships kind really key focusing a distribution We've more the November, – out more needle. – We're We've the of at Touche, in that way. more where focusing that's move huge can a going again, focused resilience partners Yes. enterprises an offering us. where lower continuing large reviews, build with they're on believe in levels Deloitte of

down is that progress. channel the It's percentage think and through year-over-year at partner with, making result good channel numbers, of So a bit actual the more of focused was looked deals the the focus. I we as if a

Matt Stotler

Got you. Thank it. Very helpful.

Operator

Brian question next Please comes from The from go Colley Stephens. ahead.

Brian Colley

to platform in regards of made you've the just guys. questions. good the the for to that's an going could pathways NCX Thanks the CEM how kind morning update provide you intelligence and Hi, on progress platform, and In the taking to the migrating customers your just risk expectations? to strategy, relative core

David Wagner

for that question. had going Thanks I slower indicated than It's well, October. last but Yes.

talk a So remain engaged on-prem talked quarter as it preference. to the, customers they're we lowered about this towards with cause was engaged our terms we've disruption movement I customers with prematurely don't what to bias And – to about number as to the single want in their is them digit as year. with strong and of on-prem opposed a are expectation And of just again cloud. customers we've timing in we last

next So the be accounts that done not into expecting this year. expect execute year-end well. we're we'll to that extend moved to year are as continuing We're well. but moving We're at program,

Brian Colley

if as think we stable And then look it, I And net should that. curious if for growth or quarter pace the you, curious how missed just Patrick Thanks should the it. throughout trends the I'm expect remainder about relatively rates but like I'm of one apologies ARR just well? for Got for deceleration? year? retention what the then of we

David Wagner

and maintaining double-digit pace X% on QX growth that think we of QX growth, is we're and terms the In growth seeing and with consistent of ARR in our neighborhood healthy of much focused we're you a emphasis on on recurring the X%. when not you're and the one an focused guide to as when on other. piece – perpetual, Overall but thing you focus de-emphasis not, in

continuing through perpetual pipeline execute a deals. growth continue to of to on our to see on ARR going the we're so And focus and year the

Patrick Brickley

And this is Patrick.

retiring the to looking because our we're focus In the that we it that we That's disclosing the metric backwards, – ARR recurring terms not business, and we're was and was running metric net wasn't revenue of net revenue evolving been based, one are retention, had by number revenue so in retention annual based. which past the revenue. that

peaks remarks heard retention, Some of we at experiencing healthy that that in color mention was and were prepared retention in gross had I we revenue on you it QX, revenue in Dave particular last not growth year, healthy in QX. quite QX but the

based It's we think down QX, that I a you had then quarter large healthy was of deal size. heard in And the were in on and of so say – dollar it's top terms Dave renewals a in we but that, growth, notably result. large a transaction volume up, of

a had So quarter we retention revenue the pretty healthy off net revenue building gross retention.

Brian Colley

for Well right. the you time, thank gentlemen. Great. All

David Wagner

Thank you.

Operator

Scott The from Please next ahead. Berg go question comes from Needham.

Scott Berg

a Hi, backlog. Patrick, Congrats with the taking thanks I quarter. good Dave my start questions. Patrick, them, balance for and of couple get the on off guess wanted sheet to

You up large that, number completing shape three a quarters? guess, or four the in I of about countrywide maybe last relative to talked How the size quarter. here or deals does

Patrick Brickley

– much the It's when profitably still strategically focus The aren't focus think you more Dave deals and – perpetual important, as in a they're mentioned mentioned, about as business we think value. pulling dots recurring that, couple we're shifting – that I ARR, doing our just but focus that that of the on on long-term recurring. the shareholder drives backlog and towards are we Yes. think that I together

backlog not shows non-recurring revenue and half new headwind guide of and set our to revenue. full continued perpetual organic backlog, creates confident have So year and as non-reoccurring in where in business is that direction increasingly our to large that range growth. second to records, and of in it we're our bookings has our up recurring been, profitable drive ability that full confident and in that as also We're not the new terms a year

Scott Berg

bit. with That for to to in the a big the a but year. wanted color a composition maybe gave little of the in super And mentioned of around remainder large amongst about of given the bookings your healthy of some sales today how some others. pipelines a year do have Helpful. pipeline was of you non-government was of it. versus this still pipeline overall, but drill European seems as government particular Dave opportunities that ago just mix lot these between year maybe It then Last helpful, of countrywide like Got just think year government at the time? Thank I deals kind pretty of though, a we and kind government you. commentary,

David Wagner

I we're said, not in I think to to set compared Patrick as am as perpetual XXXX not records looking XXXX.

have healthy with countries And in while it's the XXX so pipeline. it European doesn't six million residents

in On of pipeline, question answering the would down be, so, bookings. in other down side bit of your perpetual and that a government bookings the terms

In deal heard good upsell into to security government. We quarter had a in terms largest a really the was the U.S. sales some U.S. of results of government contract. you the nice the an couple smart

Notification Mass win in a state a U.S. five here government the So, top in had we

Europe shaping and to growth the in So government in to Last is really, North strong relative the be really vertical year year America, Europe. U.S. it's us. strong up for stronger had slightly a

sorry, being broadly more question. as stronger I'm geographic shift than a your seeing North American North answer a – you towards are slight a to I'm American

Scott Berg

questions. Excellent. Thanks for taking my

Operator

Fargo. go Turrin The from next Please ahead. question from Michael Wells comes

Michael Burg

outside longer that in range? end transitions? quarter-over-quarter customer was and of you for just Thank it of with a And on from past Can think Burg line potential, customers Michael we to start sequential decline. was much want lifeing mentioned that to the I is XXX this the the divesting Turrin. XX Congrats additions. know in can on how about delicing. that And or to of subsequently, these to into quarter due Michael the good declines you. year. and I Hi, relatively dig I expect

Patrick Brickley

for Yes, this is question. Patrick. the Thanks

logos on of there the quarter. customer XX divestitures, or life, of et So, bucket of the order end cetera, in in that were so

mid-XXs And normal we range otherwise us. that would've that relatively So for activity sort that's you been of in described.

there non-core a look bucket. at aiming that have the of and/or hundred still product are customers we – few you And divest products we still of in lifeing, in when end to the that are

low. of ARR. of are Now a still there customers them few those them, in majority is the of customer terms average hundreds. the are very ARR four-digit count Most of But

out to of continue it we'll be a timing we've when it it the and been We'll be bit do The just that'll will meaningful continue just headwind. on doing. impact lumpy So a change. has to what a call

Michael Burg

And follow-up. seen Last you and about X out from Thank still X year. to [indiscernible] quarter cohort million mentioned you. same we one of the Are the same quick the of this million as that X numbers those taken course QX over million today?

Patrick Brickley

right. that's Yeah,

of So we range targeting made as still roughly some upwards four four, we're XX. March so incremental and progress done eight, in of Thank four you. to QX, of eight that of we've

Operator

The next ahead. question comes from Will Power from Baird. Please go

Will Power

maybe lower partly on there? sales if deal on Okay, you I like within impact seeing much you sounds key seeing wonder cycles, macro. are differences perhaps touch And particularly if know, CEM in that's geographies? are can you great. you tied sizes Thank across you. just base what macro, of I seeing you and terms any touch guess a couple of are to questions maybe But it to just

Patrick Brickley

a larger makes lower sales one to this micro. that sales Yes, for the to sizes. day deal And it's on We've sure one the the elongating the aren't than where sizes focus if the so, shifted sales make company, the to product ready full hard – CEM, deals year deal the macro from on and fully subscription focus versus again comp incenting unpack plans more OnRamp point people force are. cycles to for meet they being sense customer to

up in cycle. The was velocity, overall So existing deals, as the XX% any seeing the sales especially I'm not I on sales change cycle year-over-year. said,

already performance it XXXX, perpetual having the bit doesn't with EMEA in For stronger XXXX. little much relative opportunity year, QX have EMEA largely the public of and gave strength warning a the to here North and color this regionally, as do America I to in that

Will Power

any also you are Okay. you layering perhaps function And I QX full that's that you into in with seeing, in had guidance, then expecting smaller the the maybe that just what to year frame deal upside thoughts maintain tie the what of are full maybe kind half some assume some that helped the maybe a maybe year second sizes previously conservatism, guidance, year you outlook? on the just of expecting of versus or were together

Patrick Brickley

on side I'm the the really with Yes, I EBITDA pleased positive performance. year and on flow the cash think

one happen. outperformance and just we think, repeat, with I and March thing between the earnings November I'm that making the through really the and recognize So end that had cash. and execution of pleased people making that in in

this well positions clear since think we've been with October. us to line the of I XX that about last talking sight

digit feels that double So, QX large feels good, was deals, performance QX on really good. all both perpetual perpetual the for The bookings growth lower. the steady ARR, and

I And lining balancing and the what focus up EBITDA on further de-risking so flow think, it we're our year to just and ARR, cash generation. that's and,

Will Power

makes That sense. you. Thank

Operator

The go next Please question Securities. Truist ahead. comes from Terry Tillman from

Terry Tillman

Yes, thanks Patrick and Nandan. David,

So, to or my David but I'm terms kind you question, know first buying may just forming the just speak everything evolutionary relates of the journey. in that so not, kind motions buying norm, about and product recalibrated chunks. selling smaller is How new buyer a kind bit or of to curious and don't I packaging what little just if what a be is kind or smaller of behavior – is chunks. well to address the of tuned which motion, of have you the in surprised

react to a environment. volume the well going new been it's I'm happened, just velocity Patrick. dealing with that's and able you've forward and And cash then to now about had just if and understand for flow question then trying how

David Wagner

And happening. that's a I would great it's Okay, good. say question.

at built our and kind the a back being Marketing were were so And project, the muscles completed foundation. joined and if digital time that just was Chief messaging just The done, And course, February marketing, our marketing being new Revenue executed, the new the on. but Chief at on came and go same Officer, the Officer on of going two rebranding look strong the XX. there things in rebrand, of focus we building

Everbridge family in to cross up we're customers opinion, in we're sell. right my the in and those sure the building muscles the generate So, bringing are, for process the muscles, get and SaaS, make experience sell, strengthening which the that to of to

improving re-compliment OKR to feedback tech But I sales very So off increasing is we back The steady get July in certainly pushed to last the executing sales North a still had to team. that the happened. back flow, beginning set the was when We're force. and the the department, I would up, early want process to key I team of sales sales first call the numbers that tenure well. that increasingly joined we're seeing our from May. go kickoff American has And We the of loop BDR got and opportunities. sales stack.

feeling as their so And ability about North in to customers good feeling sellers are they the with their year. plans execute our American where all the journey, feeling are of opportunity, about their good they about good and the for are

Terry Tillman

notable like That's good benefit it it Thanks like the looks flow It I OCF to history. operating AR a hear. was reported highest was to David. in looked business. Patrick the or cash And guess

I'm year, you can forecast? share about what curious you. change about so, the flow? is for kind cash do And your conversion how flow? flow like of anything on cash like that Does think EBITDA Thank we cash full to And

Patrick Brickley

exactly and a free one seasonally therefore flow bit It's and on wasn't a QX we was of an year QX for important ago, flow is QX for anomaly. that that that and the the cash typically the question, and I a Thanks us. those all renewals collection we really in the good to quarter Terry. did an invoices. in cash driving anticipate case operating we QX had know Yes. of continue but high focus as a given

end anticipate QX this should renewals. By in collected lower. be seasonality you will continuing, lot of and QX, and QX to XXXX, had back that so of the year QX normal of QX So, those a we

And so much and bit you much stronger QX than see being and levels. up little QX will QX typically back lower cash flow, a to QX higher

thinking still year of that free try of full and $XX So in flow of and to cash model we sort around we're million. the order trough,

Terry Tillman

That's great. Thank you.

Patrick Brickley

bet. You

Operator

from ahead. Please Northland go Mike the Capital So from comes question next Latimore Markets.

Mike Latimore

very Great. much. thanks Yes,

In that And second Mass bit? business. little for has the did perform, expectations growing just start declining, since How it question Notification a terms the that is changed license of then of year? your on perpetual is year, this stable, the the

David Wagner

– year-over-year. we're half great And flat. – we're year. did about for Day, we're digest that think, perpetual you half, flat. not in When I had not great, well, our we our bridge look to We you'll guide you were the but $XX second not the not talking guidance that of perpetual So question. revenue we're perhaps, last we allows When second million, allowing flat be the in see out and not Investor for be that in for exactly see can't to

roll happen, think, guess, by where adjusting risk the doesn't not when guide, I but we're going you definition, risk you'll to the adjusting perpetual you'll mean navigating that's us So see our through see that it's outlook. I

Mike Latimore

on Got Mass it. Notification, And then is that…

David Wagner

me to steady. the work Notification, things one common companies Mass the and events. about is Real point, the ability on critical doing most I'm their ramp. great. really you Mass starting steady, pleased mature, respond it's point the think about Great, Notification from as predict common talk real we're of hear most with the and or in recover when product

CEM. sell saw steady that as the using business. we've in engine We're nice, sell continues a the performance a engine, cross of cross part for as that So

us So, time more that's little core I And to dividends. think company going year. is the we last pay this than feel a in putting focus that had maybe like I

Mike Latimore

Great.

you. Thank Okay.

Operator

Ikeda question Please Bank last America. go The ahead. from comes of Koji from

Unidentified Analyst

new It being it is I headwinds able my you of higher this to volumes. bit normal for that [ph] wondering Could little while. highlighted a was understand McGreen a in is taking the of of incentivize macro some that George and I question. showing that Koji. sounds is decreasing are in up of deal kind this you've on reiterated for you've guide like full sizes, Hello, terms but for year Hi. the higher of Thanks color sizes. given And provide terms on more doing your kind kind volumes? deal what smaller you're goals, ARR the achieve to

David Wagner

Yes.

of So, tenure sales the which all, I the of key maturation mentioned is the driver and first force.

– elephant hunting customer the the and to with are year-over-year increase the CEM, in that so, to force higher for steady we plan size targets opportunity the they or towards And again, to in journey were intentional confidence – the comp territory meeting performance confidence forward. where sellers intentional QX sales design that's and of were whether we beginning me moving of gives point the getting their make their aligned emphasizing, allow that's to product not de-emphasize CEM ready whether today

intentionally focus in velocity those focus increase retention our So of motions on staff selling things key – sellers, things on intentional place. or are the that that

our matching And really in he he's is the with different John to need in with market coming adept really my of the go-to-market him at motions experience market. – sub-segments

to that And are. which several again improving see I quarters, so the digital marketing, expect the meeting sales in is of the so next to course over they key so to improving where place customers optimize me,

So we've in beginning we're in our velocity. drive to got execute lot intentionality a to that of continue process to

Unidentified Analyst

what's to for of in average using able platform? you thinking long kind would customers your who customers more question of Okay. at then ARR be versus CEM And the thousand if about helpful. of That term, speak ARR could aren't – platform target could uplift one ask kind customers to the an very XXX CEM the you I

David Wagner

to and $XXX,XXX get that, within Investor ARR Yes. me but exactly our at on over where gave Day, average – of is thought our customers back color good We average the I XXX. the go you have $X,XXX,

when And driving size our CEM, customer XXX% Notification And do. so move we're talking, XXX%, what it's that's a deal the overall from uplift increase ASP. in Mass to a to we're in we meaningful

XXX,XXX, marginally we're piece basis measuring points XX customers on quarter-over-quarter. focusing and of those is little over up and ARR color like percent Another from what of our it moved

which see as despite of the the life CEM, improve deal customers focus acquired continuing to that some our we're and number improve. XXX,XXX sizes upsell the end with of we down over products the from without small intentionality with to thing So we continuing the customers being of is were – to on small percentage

Unidentified Analyst

you. That's Thank very helpful.

Operator

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

David Wagner

speaking to look the you I look shareholders coming of and Thank and call. published. will joining in all on the the earnings And forward many all you days after be early again August in QX of our with for to updating many us analysts forward results weeks. our

Have great you day. a Thank much. very

Operator

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

Good lines. your disconnect now bye. may You

Everbridge (EVBG) 9 May 232023 Q1 Earnings call transcript