Earnings call transcript Q4 2022

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Operator

Good day, and thank you for standing by, and welcome to Appian Fourth Quarter 2022 Earnings Conference Call. [Operator Instructions]. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Sri Anantha, Senior Director of Finance, Investor Relations. Please go ahead.

Srinivas Anantha

Operator. you, Thank thank Fourth and joining to us Good and you full Appian's quarter results. year review afternoon, for XXXX financial today Chairman Calkins, Mark Officer. are Executive me and Financial Matheos, and Officer; Chief With Chief Matt

prepared you want presentation. Today, After for the along will we the to will call remarks, questions. with follow earnings open

download can investors.appian.com. main the our of You page from it at investor site

to XXXX, to and are may safe pursuant this maintain related that include and first position, strategy, and These federal ability our statements our benefits to growth of guidance of and and we provisions Act Private expand our new the market results, to financial ability business make customers, Litigation our forward-looking call, existing are securities the the to year laws platform, During and opportunity our to our acquire go-to-market under and customers. comments our Reform quarter related for leadership trends made ability the XXXX. our and harbor market Securities full upsell industry trends, and of

differ today. our and only They continue, indications uncertainties any are future will forward-looking variety risks reflect could expect, a These intend, of statements are date. do They of and our from that expressions represent views words anticipate, as actual statements to The or intended of estimate, materially similar as to not subsequent similar expectations. identify views results of subject to expectations. cause

the documents website. important also results, that to and Investors refer our other filings a XX-K the For our and SEC. are of affect could our discussion of These actual our on risk with factors available section material XXXX other periodic

measures conference call. financial on this non-GAAP will discussed Additionally, be

to of Matt like to in that, most and Refer would their I With Matt? of our our directly to measures these earnings Calkins. section call our turn release to for CEO, GAAP comparable measures. a the financial reconciliation website Investors the tables the

Matthew Calkins

constant today. us been of everyone, subscription would Thanks, XX% Appian's for cloud grew Sri, In the joining revenue XXXX, In quarter have the and thanks, currency, million. growth fourth $XX.X XX%. to

by grew million. to grew revenue XX% million. Subscriptions to XX% Total $XXX.X $XX.X revenue

cloud XXX%, of and was was million. loss EBITDA a $XX.X retention subscription Our our revenue rate adjusted

Appian's For to cloud XX% $XXX.X year, revenue million. full subscriptions grew the

Total grew XX% to grew to XX% revenue Subscriptions $XXX.X million. million. revenue $XXX.X

Our adjusted met These of guidance. exceeded a was EBITDA loss $XX.X results million. or our

in We XXXX, firms. affected that recession and will believe continue Appian expect to be it we a than other by less comparable

things emphasizes proposition seek and to efficiency, the very in value ROI, Appian's productivity, value buyers downed economy. time a

the be there Last X.X%, think year's of horizon. XXXX. in U.S. productivity the on result revolution I Speaking the productivity, growth a negative may worst since was

reflects post also labor changing a indifference to but certain the COVID patterns topic. This corporate

to on years productivity, focus businesses was For now, haven't was labor since plentiful. and cheap had money

they'll earnest, is return tight, labor money there for a that waiting surprise is and the and in topic expensive is Now to them.

The has science in of a past long come the years. productivity way enhancement few

work. be Software ready is than do to tool to people help a more

revolution. Software is us. the do the work That's ready to for

cheat good is AI AI a satisfaction. on on will also That's affecting margins, affecting will the is months, engine use AI. is search shoe now, it narrative it Right affecting AI the be maybe makes tests. next that on customer In narrative the drop that and to jobs, their AI X to students is

to. moved After corporate but development, the efficiency hardly still has needle, decades about AI of it's

will work like so types and do that RPA. of the software other Rules And the

will these is a particularly, so the workers, which all process digital coordinates And in leader. technology automation, namely Appian that

mission. time larger At a toward evolve the we our in to continue IPO of workflow. will XXXX, sold market Our

and life to but work, process execute optimize technologies fabric work, the routes automate mining plus connects process. that everything efficiency, design RPA do evaluate evaluates cycle that Not a process AI, Now you the that it, now workflow enterprise. it, process stage technology like we sell plus your it, that the covering the platform need handle process also the the ever information across data time. and the it, process, end-to-end every an with it, the do automation, discover it We over in just to

Here's an customer. the sciences a a example automation a largest of of an This modern customer world's is one for about company, process life top and Appian decade.

Our function, supply devices, pharmaceutical platform corporate processes. automates its and medical chain

can cases in regulatory a manage has it XXXX of That It mining of deployed XXXX, It over ways labor hundreds process to operations. thousands just mission-critical insights annually. XXX Appian of manages firm In that grown save time. thousands QX to countries. identify of app globally. of the to practices annually tens discovered in weeks, deployed simplify hours in X Appian And now app

sharing set a during quarter, business keep recession. metrics mentioned I a that health track of Last I

see note charts Slide presentation, earnings X. go through won't You'll of I these a pause to just again, our starting all will I things. them in but on couple

of each especially the First, quarters also customer best-in-class It's gross at of spectacular ones. constant in rate, a held large is This our the our a rate. cloud I'll renewal cohorts, year. ARR note XX% rate. growth X on steady which

customers our year, customers. more bought X-figure last existing software Most including of X/X

are bigger. share I'll Our X getting examples. customers big

global the analytics market processes. its uses First, our research and to provider platform customer ARR X-figure automate

researchers automate productivity licenses the boosts insights it workflow purchased and quarter, XX%, consolidates content. publish for employee market of One users single of the intelligence add streams by work new its commodity to can a workflows Last and X-X. RPA groups. so and its more of into critical company thousands app This app AI additional

our QX, million international in retail been subsidiary software Appian chain. groups, purchased an This manage new top its a into logistics expanded nearly inventory. $X to In retailer has licenses of a one grocery pharmacy since manages client It customer Appian we XXXX. on chain Second, supply platform.

prescription Appian, lacked Before on it way annually of expired products. losing millions dollars tens dates, track to the drug expiration of

XX%. can identify goods It products move its Now stores wasted to lower stock. reduce expects customer short-term of with the and to cost by

high make quality. use They be large software continue important for logos Appian's to purchases new cases.

It a QX. million software became in international use to $X in a cases. specialty purchased X example, For licenses automate over distinct top new logo insurer

thousands First, Claims Appian claims the tens it manage of annually. of to will deploy Connected solution

customer it operations build the help Appian partner. of Second, an a with will hub

Appian, to group the coordinate tools because teams. it channels work across disjointed through lacked worked Before the

Appian into integrate consolidate a single the system customer's will Now existing tasks workflow. CRM and with

landed a customer licenses orders manufacturer packaging client also automate a purchased We logo This Appian and nearly new line distributor and new in launching luxury is manage to quarter. as and relationships. $X a business million this

and requests initiate the requests employees revenue purchase portal. status of and through their to an make office ongoing will fulfill Clients use recognition. Appian Back Appian orders track will

XX%. the scales by will Our platform secure it company's margin profit as operations

verticals vertical. QX and revenue Sciences subscriptions U.S. XX%, the growth Federal Year-over-year, customer be share Government and Appian's drivers. I'll for story continue Life each respectively. to a from key grew XX%

federal annually. agency medical a security First, this health became a over Appian that national customer supplies new quarter. It supports U.S. billion in $X procures

to the workflows expensive to In use and our QX, system. and like requirements management, drafting suite. purchased acquisition It government needs an inflexible request solutions automate will procurement several It agency for in various gathering Appian replace or GAM, proposals.

first deploy X-figure purchased globally. number automated deviations The manufacturing a a agency has an platform. processes this an QX, became our core customer deal additional company it Top global pharmaceutical to of X-figure deal. that In with app ARR tracks with

helps We process. a and to governing because efficiency customer a won our cases competitive deadline platform customer is by highly improve strict deal the a The This regulated this these XX%. required report is meet body. operational to third-party

corporate the I'd recently, of Young to teams Directors. firm's decades Appian of most has Edwards has X boards and global partner the at the to & multinational announce service management Next, been She like of addition large companies. and for Board client partner. advising Shirley experience, a Shirley deep Ernst

We pleased almost That's team. very to our to are welcome Shirley everything.

the on In again Appian's XXXX, with to planning we are than briefly last EBITDA, a I year. in narrower Before I business. though, investment conclude, negative want margin albeit discuss stance once

near-term less Investors believe shareholders. considered the we profits interest We growth the are valuable continued question merits We've right investment right understand growth. continued for more decision today's that deeply, for future and high further is that about our this for growth valuable. and rates investment companies to of make

long-term platform, the ourselves and most size time our of we on when we believe And our At Appian, lengthen to outlook. large horizon pride advantage is we're growing and the and competitors nature historical positive our XX% the of subscription note our rate. the We our our time cloud gross important traction renewal partners, the . seeing very revenue of margin, gross from customers attractive market, technological XX% stream,

That remains we scrutiny. our said, through to and We ultimately investors returns. the and steadily growth believe invest to like and business committed to disciplined importance XXXX will assure margins that our would and lead the We beyond. improve we growth right to of higher are and much aim continuing to understand our decision for shareholders

look deeper a to Now I'll financials. for the hand call our Mark at

Mark Matheos

QX Thanks, Total provide non-GAAP review then while our above was Matt. and year at the EPS quarter, adjusted and range. of revenue, guidance, XXXX. full guidance revenue financial end the the for EBITDA I'll and we'll cloud top were for the highlights subscription guidance

industry We also strong from existing key continued verticals. saw customers from healthy growth and contribution

year-over-year. subscription XX% a year-over-year cloud guidance. into XX% million, of Cloud On subscription go and details. grew Let's increase the $XX.X was revenue above revenue constant an basis, currency

revenue revenue year-over-year. million, grew revenue increase year-over-year. increase of of On XX% constant XX% an an currency was XX% year-over-year. services million, subscriptions subscriptions basis, $XX.X $XX.X total Total was Professional a

partners. partner programs Appian offerings. that primarily noted, partners Appian's cases, complementary by previously our continue drive As are large growth. Long term, of our we are to most run professional believe to will services In supports certain

services to decline revenue. percentage we of a to revenue professional expect As total continue a result, as

in quarter. an basis, Total and in range. revenue XX% was year-over-year. compared revenue revenue the XX% to year-over-year Subscriptions of above XX% $XXX.X XX% a prior period currency grew XX% guidance On constant revenue the year increase ago of was total and total our million,

rate XXX%, the revenue consistent quarter. XXXX with XX, was in Our cloud subscription prior retention the of rate as December

retention As to quarterly to on revenue XXX% reminder, rate a cloud subscription basis. a of target continue we XXX% a

revenue operations contributed XX% the international period. to ago total of year in XX% compared Our

new with net total ACV Our new XX% net last consistent approximately XXXX, in bookings, bookings cloud mix. software, year's of software were the

the turn gross and Subscriptions the the consistent XX% prior XX% was metrics. with quarter. period our profitability and to in Non-GAAP ago was Now period gross compared XX%, margin non-GAAP profit to I'll XX%, in quarter. prior margin year year-ago

XX%, and prior period Professional in in gross quarter. XX% non-GAAP the to year-ago was compared XX% margin services the

help advisers customers success These continue from adoption As to noted our and most on we prior customer the calls, technology achieve platform. of our our in invest management. increase earnings

operating to low the XX% As in an and professional should non-GAAP services margin in from result, the non-GAAP million, of million ago a year XXXX XX% beyond. period. gross decline $XX.X $XXX.X Total expenses were range increase

million million of million million compared $XX of $X.X fourth compared foreign In the in Adjusted versus the of $XX in million and EBITDA ago. a ago loss a EBITDA the exchange foreign same to our guidance loss we gains loss year year adjusted $XX.X period. gains was $XX $XXX,XXX exchange in had between quarter, to an approximately period

guidance. aren't for or non-GAAP of We and $XX.X fourth movements rates. Therefore, share was diluted our $X.XX $X.XX don't XXXX. or compared loss share forecast million million they considered basic in loss $XX.X net Non-GAAP per to basic FX and diluted of per in quarter net the

This quarter on and of based diluted the outstanding XX.X XXXX and of diluted shares quarter fourth basic million the XX.X is fourth and for shares outstanding basic XXXX. for million

of included As XXXX million was guidance. was a net exchange not $X.X which original gain in per aided fourth noted share, our $X.XX gains above, loss quarter by non-GAAP or in foreign

balance our to Turning sheet.

XXXX. million and of as were $XXX cash XXXX, cash investments and As equivalents XX, with XX, million, $XXX of December December compared

the For million last quarter, $XX.X year. cash for operations $XX.X million used same fourth the period by was versus

deferred million an XXXX, XX, $XXX.X the XX% increase Total December ago year was of from as period. revenue of

on on an majority calls, basis, stated the large that have are but billed have annual past customers invoiced of or our monthly. we are we As upfront quarterly also customers

I'll variability the in our not revenue $XXX.X results. representing momentum Cloud of year subscription recap indicative generally terms, XXXX XX% to changes business. our of billing full million, was now deferred Due growth are year-over-year. revenue the in our our

subscriptions revenue for increase subscriptions On Professional increase million, a year was constant an currency revenue basis, an currency On XX% of $XXX.X XXXX. grew a million, XX% Total $XXX.X XX%. XX% constant year-over-year. of year-over-year. to revenue the revenue was total services basis, grew compared cloud subscription

grew was Total Adjusted XXXX. million compared to loss compared million, up was loss in constant $XXX XXXX. revenue revenue On XX% to year-over-year. total $XX.X $XX basis, a EBITDA XX% currency million

XXXX of $XX.X million or XXXX share basic $XX.X a net basic non-GAAP of and of respectively. per XXXX. XX or is million $X.XX and diluted shares for share Non-GAAP net million to for was XXXX, This loss loss compared a per $X.XX outstanding million loss based and XX.X basic on diluted loss and in and diluted

XXXX, XX, XXXX, $XX.X used year. in million December In expenses in period $XX.X litigation versus compared million XXXX. cash year same the million for million operations $XX.X to were For ended was last $XXX.X the

We materially down expect litigation expenses in to come XXXX.

contracts. our performance revenue continue latter on-prem believe RPO. software momentum can whether a on deploys subscription business of which We customer timing of cloud, obligations billings subscription cloud and the to of The seasonality or scale by of is on-prem. or all fluctuate subscriptions duration The cloud than license the invoicing, indicator is Appian the represented customer of revenue, private better metrics in the based or their includes remaining to support regardless business the of revenue revenue true

I'll turn Now guidance. to

growth $XXX of $XX year-over-year and and to quarter XX% is XX%. XX% For revenue XXXX, first XX%. expected be million, year-over-year is between the $XXX growth $XX be between expected of representing revenue of representing cloud Total to subscription million and million, to

for quarter expected $X.XX. is million. loss per basic of the XXXX XX.X This net $XX shares outstanding. to assumes average million Adjusted and be $XX between diluted EBITDA share is weighted expected common first and million between Non-GAAP loss $X.XX be to and

For and and $XXX of representing million full million, be growth year XX%. revenue between cloud is XXXX, subscription expected $XXX the to XX% year-over-year

representing is XX%. full revenue and and million to year million, between XX% $XXX the total expected growth be XXXX, of $XXX For year-over-year

net be million. expected outstanding. weighted Adjusted to assumes share loss $X.XX. diluted EBITDA $XX $X.XX common and is Non-GAAP be to between $XX basic expected million average and and XX.X loss is million shares This between per

a following: sequential XXXX. assume in We single-digit be flat First, revenue Our decline services year-over-year will basis. will at guidance relatively a professional the on revenue services assumes rate QX

the continue expect us situations help work. In services to projects. to the new We partners lead more partners perform where they close generally logo,

will year. QX license of our strongest quarter make the QX on-prem seasonality Second, weakest our revenue and quarter

revenue QX. QX up should in sequentially down sequentially Hence, expect in on-prem to you license be and

cost QX higher global QX EBITDA our Appian and adjusted World. Third, license conference, user than is This will of due on-prem be seasonality adjusted the the of EBITDA to loss loss. combination running

We out continue million be This million is between between of expenses. discretionary to expenditures related and primarily in and $XX and to QX million any related will space. maintain additional greater in of scrutiny build capital Fourth, $X million $XX XXXX. $X office

assumes guidance of excited rates February XXXX. we are opportunities our us. the Finally, about of summary, as XX, growth In FX ahead

ahead. a new on productivity We're an business close rep environment in uncertain cycle indicators macro conversion, forward-looking incorporates the Our outlook year and pipeline sales sales as growth, watch time. keeping bookings key such

the believe we We the can should quickly calibrate model need arise.

hold to Before being X, seeing over we planning questions. with you soon. forward in let additional let's May I look to Investor to that With that, an World provide wrap know to person. from it up, X are details to in Appian I'd we'll all May turn like Day conjunction you we held

Operator

first our Singh Sanjit And Morgan Stanley. comes Instructions]. [Operator question from from

Sanjit Singh

relative can that confidence give versus for resiliency end Congrats of to your if on sense sort peers. you the around wondering factors solid I the us XXXX. drive Matt, was a your

others care, or impacted. seeing through government, sort like trends out? across discretionary of seeing of have growth services, the walk the us And that seeing. of speak demand companies financial your Could are you lot tech major companies to It exposure and you some demand pipeline that to being to consumer want you're health you're trends of seems verticals, any a kind call

in helpful really terms of guidance. that think be would your I contextualizing

Matthew Calkins

tell the factors think steadiness thank I the observing that that quarter and Yes. other steady And got all. our the business. speaks It rocky first Well, from ride. seem insight a in And we're a contributory pipeline see we've we you, like the you of situation. doesn't that into I can to

there. details like Now you'd

time say they consolidate the of value me speak And pivot our reduce We person. interests us tells toward CIO proposition easy to costs, let to is that accelerate the so to impact. risk who vendors, that that wish cut to exactly and

make and they the a experiences. used person work reviews. safety. They on proven That it's an successful know They They great in for them. we for is more to look past, we're could to. to looking industry leader solutions that an to in solution a looking because want than They're relying difference look customer for industry

deployment whether partners to market we the a better, reliable our work language, even we've see or experience or, the the team speaks can this that the their that's And space X that present the team accumulated. has They industry want of and past. together, own legacy of and and it's their them in our team done similar very language, in our benefit

For all and as think we're the of reasons future for well. see that these stability quarter this the what having these near that is I successfully, I represents because conversations

Sanjit Singh

I Understood. on profitability, the term. way topic That's around versus could continuing you're of the visit squarely if helpful. investments to the over near-term then and as sort longer margins the value to sort drive of of side And invest coming

When financial think there terms the calling of to revenue overall in is for anchoring And make you business get can sort generate I this company, But a of anchor are in growth, I what mid-teens so anything -- look profile sort of longer-term at of term share of narrowing. the guidance the profitability? their when sort sort term? ultimately, the losses about of over terms can where is of the is you of the over type margins the that on to longer this assessment going valuation can longer or model, business investors

Matthew Calkins

the think term. to or free would in an I long Well, out put premature margins for right. be flow, cash that's Yes, right, it estimate

the short I term think even that in variable. highly is

the for way variation we've economic the projections to made factors, and variability higher that see. of out in gone estimates, have this accommodate year, We macro we our

we ourselves economy the a It's north And projection star QX. not of ahead advantages. I -- in It's get to have specific what for to want here. believe in is don't our not going forecasting. a look like figure. structural I that so that's And I

It's is And belief even we perfect be position emerging a a year edge margins if we in this have prediction market. where think to the the structural want are valuable a advantages, hence. ways a an to we edge our on if have that or develop and which an going in the we don't that market, competition we have for economy

Mark Matheos

we And long-term about did last Investor our we did Day, -- our do talk in margins. we --

have said. You presentation, reference. specificity, view, we than updated Matt can more with your I course, but those do that of refer to it penciled think, wasn't for we in back But any long-term some

Operator

question Kumar Goldman from from Kevin next our comes Sachs. And

Kevin Kumar

I double to just guidance. wanted click on

given also macro. you've I XXX You've some quarter. commentary on believe cautious over reps And sales I added, think, last

just ramping of how about the and kind of maybe So kind midst are of thinking the these thinking kind are there, sales different the in variables guide? how weaker through of productivity macro? in you thinking you Kind variables of of

Matthew Calkins

the Yes. way. all, first for was recession believe Well, we that have of we while on saying been a the

I say sunny was put not context. it important plans. are into to think investment to These that day our plans

are situation We cognizant we're year. economic wrestling that with of the this

realistic/pessimistic right outlook, the that are plans. feel we And investment these under that

that the our on about So to situation. macro bearish plans I to understand. investment into outlook point When put that's talk context mean the I make. It's our to

confirm for in comment growth there. on I as to speak or the size. then I your the can't And can't assumption reps,

quarters, overall reps are grown grow the last we have growing also We right now. and we in -- few

specifically. want we to endorse I figure hiring. We positions But that have don't open are and

Kevin Kumar

of maybe then Got one strategy. vertical your it. kind And on

And came talked the Guidewire. I with. believe announced also you partnership new out about with that recently a you You solution connected underwriting,

the So seeing and the traction the in of vertical opportunity maybe kind you're there? help frame insurance

Matthew Calkins

I is And management And believe in than buyers which platform. seek in mentioned mentioned a safer solution. Yes, a I solution. safety, I offering solution the that time did. acquisition a I government a also that

a is sale, in the toward profitability you're a to so And part the reassuring this solution of these in that pivot our And observing reliable, a high kind sale. reassuring regards. time is short of business value

does. actually think a market it much I broader a And than platform addresses

entity go a with about entity. market known like really a credible or known Guidewire, ability excited I'm our to with to a packaged So highly solution

under accelerated it. card, next should and that think our we economic I and playing playing that evolution of conditions, it's are business these we the natural be

Operator

from Company. question from next our And comes and Cowen Derrick Wood

Andrew Sherman

the It's Derek. Andrew the the on guide FX year? to quarter for for what cloud and sub just wondering Mark, is impact the

Mark Matheos

was Yes, results X%. it talking we impact that for the or about are It's on -- had you the...

Andrew Sherman

guidance. in year and No, full QX

Mark Matheos

No.

using So more FX we as XX. factor February don't actually in of any rates We're movement.

more facing we're headwinds, any So yes. not

Andrew Sherman

quarter? Mark, Matt did quarters? cycles And pretty the quarter, sales you are then of for next couple were And those How Okay. and/or from much said this quarters. last prior unchanged you expecting what track

Matthew Calkins

Well, because say slipped And for anything sales therefore, Yes. material. change nothing observe, can quarter that out quarters. no cycles in to always we don't we future the slips, that we see And nothing of don't I so mean forecast right? something

a we're amount get enough that on movement to a that is for any there pipeline. always presume it's You But few seeing deals not overall extend. our us typical and

Andrew Sherman

one Great. The in. is event takeaways I this helps that? And could Appian last and how build And much sneak that that got how for one Government year? generation lead November, from the pipeline you of in any Summit interesting

Matthew Calkins

our of that expanding and for events logos cultivating Most existing already customers we've Okay. within got. are

that's typically so help will build pipeline the outcome. pipeline. that's us generally And radiation It

little part, But are that purpose. for new Appian relationships just got. strengthen a because based Washington. bit customers to We're we've with near of not the our do trying lot our the we prospects is the most logos local on the a because better government are Maybe

Operator

comes question Jacob from next our And Roberge Blair. from William and

Jacob Roberge

in you next earlier on the variability you finer factoring Congrats perspective? put for what guidance from baked results. Matt, the guidance a solid about in Could a point macro higher a year. you referenced the

as that it assuming the worse happened throughout what Are same Are you get demand stays in QX? to slightly expecting XXXX? you

Matthew Calkins

a effects be felt which are here. downturn, will of there that possibility macro the for allowing are We the

well. everyone that think possibility. it's so And prudent for as we do I is allowing that think I that

Jacob Roberge

the more could process how news, would Pega? the to over back or know that X? And with has some last on month an some been there's X in the give tracking you been get update lawsuit color then but Great. us and love forth on I you between

Mark Matheos

Well, continues. pages. have been dueling There web process the

this other's call seen everyone -- You page. on has the opposing statements on web probably each

going there's next than that. statements for that, can't do sales, a be soon, let on I in I appeal. say it. comment the factor dueling And believe some Other it's me to round of

that judgment course, and reaching their the should are believe of based do own an out all is are beginning which, facts customers word ongoing available. I this they is customers notice do to getting on process. and But

Operator

And our question from Joe next from comes Truist. Meares

Joseph Meares

fourth the in In sales and growth marketing the X sequential the pretty last quarter, with much line was in years.

I in think it grew about XX%. versus percentage. up But the typically G&A was being teens low flat the

wondering we should expect So and I'm in and in this move pattern spending marketing XXXX. type as just leverage sales if through G&A you of

Matthew Calkins

in We a meet threshold. pattern are expenditures with of growth we my applying investing. only that with say our high opening high as But noted are we that to are hiring, we level investments and a also of make expectations which is are growing, scrutiny, to we are those continuing proceeding in remarks, we I XXXX all

we're the off probably about the G&A falling you'll sheet because wanted some or to of of so And see other be And or we them. get marketing expense this returns tough out that going didn't year. expenses we

Joseph Meares

like us down think or at end a X-figure up -- total And that of -- I X-figure Did number helpful. super number in X a standpoint, could of I That's remarks. customer the that was I'm just usually curious any just number customers. were if deals counted then others? then give the prepared And think I from year, you if the you new there sequentially?

you curious share that? can if Just

Matthew Calkins

Yes. the It's in slides.

customer Annualized slide X charts in to in Let the and tell packet it me this is we the on should which Recurring Revenue, have direct Slide I slide. X. count, see order to you It's titled you

of that, right, that get customers as lower $X or the are growth basis. much we The in We're additional well, that an in larger is nicely. to on which more think more customers. And where the grow, entry need bringing annual and going the to up on customers emphasis a little didn't We put focus. doing smaller And shows million ticked I count us favorite getting big our we're level. on one put to

Operator

from George comes from question next Citi. our And Kurosawa

George Kurosawa

George on Steve for Enders.

talked hype about that First technology. in I'd how just hear cycle a right AI you Matt, of one, kind about you're now. level little bit of a love some thinking to

leg kind is it Are sense with of of as different a may along even stool this to new over the new something you and which process there some thinking and Or of these AI of RPA, process new kind is company the replace time? other generative technologies about automation? in come mining, for some

Matthew Calkins

process as XX Yes. to work AI Well, and that continue in work delegating to to as work popularly to the to something addition software over about understood emergence is value market. to add the is going us its the all, past automation harnessing months shape automation people. for a After process does

And AI of is going to us. for be one of the primary types technologies work that does

popular where there's it this. broken misunderstanding And through is about think still way in about lately. add value. really explore to can big I And a lot a there's AI So vast

And not AI lower is for further last months quantifying decisions hype. And shouldn't detecting, repeat that the I advisory people of believe. view suppose put a a in than position I'll belongs from even technology, like fit be is my my after good that. belief most few in AI long-standing the belief, and are stack people making afield

AI I think other decision-makers It's when going value about which value, and maker. is only of a AI it going is its be is work say be greatest and portfolio clear let routed one balanced the of to me decision its coordinated is amongst be which at final decision-makers greatest to not is to when at this. to

AI If valuable part alone. stand you believe because that, as of then of work you believe that part process really automation a is essential you can't leveraging a

decisions your orchestra review the it, of balance delegate orchestra part approve You which that that thing, just a the can't needs to of conductor. it, is you work, check to and means AI, it, its AI sort need

really end, in that the their process of shake a And do. and meantime, not a in AI think and have going elevate people to can us. of part it's the what adds the But I lot people answer. momentum that of final it's understanding the So teach industry, AI automation to have portfolio to to think out we'll that I

George Kurosawa

it. And Very just logos follow-up. rate the at there strategy it. of Got for from versus sort couple now a Is now? about mix any quick XXX%. solid I'm has came Jones Got quarters in revenue growth been pretty of place wondering interesting One that that in The just you stuff. change new expansion. guys to retention of Chris are thinking how

Matthew Calkins

happy steady. Yes. Yes, we're that, to that's see

metrics, evidence net watching all to renewal, renewal, kind there's we're course, of some of these macro renewal effects. -- Of if see gross to

the And pleased we'd and Chris observing. I few that I'm asking can of a to and into see more. always base more love sales who else want see so selling our moments acquisitions. always matter, logo and anybody existing to with degree that get we're for that additional far, we're I'll solidness

all We're we're year. customers, we on fronts the anything off, of new to not So this will advance ability not up on we're writing growth. not best giving our deprioritizing

at the we relatively assigning the satisfying to look have steadiness. result we're Now a these our priorities. full to But is in meantime, each of attention main

Operator

from Andrew DeGasperi Berenberg. And our next from question comes

Andrew DeGasperi

Maybe question. high-level first the on a one, it's like

this in noticed implement to implementing of going time the transitioning As evidence Are live to lines during you've time? the you partners you have seeing that? shortened been product Appian, for

Matthew Calkins

steady. it's I say would

times go-live consistent. Our have been

Andrew DeGasperi

like And it it would of Appian think expansion maybe terms line sounds what you it's terms tight now. more on for then the if is for time reasonable terms right revenue made, AI But of believe just a you of that, see do the in do you you things what kind and will of that? Great. -- in in to materialize that commentary potential

Matthew Calkins

Well, revenue hype. follows

people checks. don't wait you figure writing -- have belongs actually, you to need where in stack the until before out start they to don't AI So need

year I X imagine belongs people a that or AI through we're think that where decisions. making going now will

And but adviser, so there'll our as of be real AI show AI And talk thing. an the or about not can to how an the is write next your should and decider. maybe contributor this be not I think process going value sort author position appraiser,

have to on people going I to we're educate think that.

this can mean, can It's value of what they with be for can hype going we're incredible they lot what's a AI. show drawings add. A all is missing what Fortunately, of these make, do, to the what days these write. to they I stories able -- lot papers

your But our right? what is lowering helped electricity not is What doing you're bill, economics. they're AI not hearing

can right? AI actually That's that, helps does. we our economics. It so the And what show

So some I to hyperbole. be carry tangible will with coming in we're up they stories, of and going face the think the day that even

Operator

And question from next our [ph]. Frederick from Appian comes Havemeyer

Frederick Havemeyer

my Appian, don't from guys I it. to at resume Macquarie. yet. just Haven't I I'm work shot you cover

and hiring talking firstly, last of resumes, actually hiring we of cadence speaking your So ahead quarter, plan. were about

-- and wanted year. also prioritizing ramping the on been at just prudent that last the check that have extended growth terminology And made I hired cautious since in hires been the have But as the how the ramping really same investment and just that hiring were reps how to throughout rather period? the quarter about you're really, thinking time. have those

Matthew Calkins

in that have any It's made early quantifiable an to executive results can't expect period. say account to we because

our that system So I on and our are believe models while can our I better talent coaching say actualization than before. that and so and training

results. to you can't point any I

out So reasons today. have quantify turn been a to that I good my I that will believe cannot investment. for

Frederick Havemeyer

Okay. another year to I ask we're year. questions, rather just financial being And analyst suppose, about ask, investment wanted bigger about stepping really I we're want typical than, to then as here. investment thinking into Matt, the thinking picture really I back, Appian, next

goal as stack this and vision, what dream As you assembled you're have platform, like for longer-term low-code it's is into automation entire a platform, Appian it? platform, full a investing your

walk where you be like really company? taking through and the to highest Could us the you at just level, that would

Matthew Calkins

at their also more human to efficiently. allowing quickly Yes. It's the empower should collaborate way. to with be is supposed people speed. software to technology. empower organizations behavior process people with process up express by organizations. should another, with and move their question, personality by and their keep empower us to relationships from It times and one by to And to changing and in pivoting and control Love by empower it Appian their supposed the able technology essentially, direct to

a bigger means those can we'd economic like goals this see ourselves space, So of as the And this be of by kind that's achieved. the mission to which organization. with inventing pioneer our we in impact have

proud be So even we're the state done if some to of innovating still implementation by others, of is the art. the

Operator

SMBC comes Nikko from Instructions]. Securities. Koenig our from Steve next [Operator And question

Steven Koenig

on there's call, to your between congrats so -- And your we this mention Koenig. time very is ask just And Steve understand growth that trade-off performance. is investing first for getting growth and clear, I'll steady profitability. happy and the want to a on since also, It's my a position speak is SMBC customer. you regarding Appian I

Rule-of-XX trade-off? terms the about Appian think in even wondering trade-off that possible? we how overall that your If score, improve is I'm Or can of

Matthew Calkins

in score possible. will We great time. which it's in invest Yes, not for It's our it some things lot. Rule-of-XX question. It's about some absolutely absolutely possible. a We a manifest think

We substantial the in We're innovating space. a example. investment R&D, for have

XX perspective. parts We said, turn that organization the don't product Rule by make in I up of are our that later. centrally. correctly acquisitions years efficiency, and technology diagnosed Rule-of-XX believe a in using That I some our of guide are there improvable which

For organization, efficiency example, and not looking efficiency higher revenue. way go-to-market in efficiency, like the believe very into of great. convert the we successful and our cognizant where in, is say, improve can at great where see a new we it's I investments we're I'd to

lists And of so get to that better. we introspect have we and things want we

and how the case And we're new pioneering be it organization inventing can always get at you technology of growing customers, make market. going time, a get we're We're So that's tip better. the this a we how leading a organization. and We're and to you trail. spear inventing same this to

Mark Matheos

bit little to a add that. just I'll And Yes.

we're the at R&D. cost thing Chennai, find at end doing part looking of as I the And trying strategy. even in development think The side, efficiencies one tech the Matt is India that said, to center in is everywhere, will even as when day, forcing able that matter that not a centrally side, though been growth to efficiency a combined XX, of consistent of with that we Rule demonstrate, on the towards which the that be we're healthy, have result cost rate, we've of practice.

Operator

am this questions. I Thank now today's call. for -- you no concludes I And further participating. showing would conference

You may disconnect.

Appian (APPN) 16 Feb 232022 Q4 Earnings call transcript