USER - Earnings call transcript Q4 2021

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Operator

Greetings and welcome to the UserTesting Fourth Quarter and Year End 2021 Earnings Conference Call. At this time all participants are in listen only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the call over to Erica Mannion at Sapphire Investor Relations. begin. may you you, Thank

Erica Mannion

review Thank you are Pexton, today UserTesting quarter the XXXX. Jon ended a full With the Financial results good MacMillan, quarter company's Chief financial outlook review will full and year XX, afternoon. brief with fourth and Andy the for begin Jon Andy me for the Executive quarter business December Officer. for XXXX. year, from fourth will and then of Officer Chief the the results followed by first and

We Please actual will risks will statements for materially then and open the current to involve results know include call questions. management's that cause call that from this could differ uncertainties that expectations. forward-looking

that SEC our to as other our as For discussed please refer the available results, filings web could website, and affect website, material discussion -- important of the and our actual well risks the risks in release. on SEC's and Relations on today's press factors Investor factors important other

U.S. performance. in or as not management evaluates for evaluating from investors These information a XXXX operating of of company's report for understanding that December substitutes and non-GAAP property and non-GAAP how provide measures presentation they as are this certain is copyright rights Please company's with should isolation The the be on non-GAAP measures believe our with in we GAAP. not accordance presentation reserved. considered in the sole means ended in press of release the U.S. with issued was which financial material accordance year website. also Form regarding all found note XX, net our annual on GAAP that Investor GAAP. the to reconciliation measures be superior presented Additional filed. in the XX-K non-GAAP per are this the this All non-GAAP and net measures can Relations measures share, be contained prepared describes webcast set loss UserTesting when Information measures forth including loss net to prepared afternoon will non-GAAP in with in

call like Now, I'd Andy. over to to turn the

Andy MacMillan

full year-over-year, in year of a revenue Thank up year. call process of this of to quarter thank going on XXXX. XX% $XX with million, accounted afternoon of We're for million, revenue fourth XX% momentum opportunity and Investments company. our earnings extend resulting which year-over-year. their to of business quarter up record to the revenue ARR, prior from focus large our quarter a start and XXX increase in a to $XX teams the UserTesting you, XX% as our throughout first highlights to on in discuss you product, our million, first as drive those the than report many over Erica. We joining throughout of Then over total XX% more UserTesting. reached business want sales, to an us public. the revenue in $XXX Subscription was great had growing I in upsides excited be customers customers, our a marketing XXXX. hard this to public team public categorized XX% continued you spending work a to with quarter increase special I representing reported $XXX,XXX the take and for a result as because for market Thanks it's we the as to our from everyone afternoon. to our may customers for few time quarter. company. want our I'll call some We and new

In platform, total, X,XXX we from Our one customers QX XXX% net XXX% dollar the have on ago. one retention rate from to XX% ago. up increased year now year

and continue managing growth investing market believe structure. to technology innovation, and we long-term we market intend while opportunity remains our the prudently significant forward, ahead expense awareness, Looking in

to organization while period the near and capture deploying continue into investments and good the economics our marketing We sales in payback we unit to industry. see consistent a long-term and see market opportunities

made years, our investments team, over and continues the the our believe enables expansion for in testing The to of several to insight our do solution. platform opt-in like the strong, international human past enduring we in product understand we will to actually with UserTesting value. first drive customer. platform. show organizations what demand to also their We which experience market an continue that call We it's be video

are providing real countries. understand experiences narratives the anyone what narrative platform or experiences apps, other it organization perspectives engage an over Our These vivid and even you empathize better products, digital and they companies to watch people and share makes for enabling their and UserTesting in real critical improve a platform, Through CxN. in easy experience on to we them. has world XX call and understand offer with to experience. customers get customer the first-person a services,

top than world's most to include Forbes. the XXX according more customers brands of Our half valuable

We thousands who hundreds network share people have have their have over our the of of years qualified XX opted of all built steadily and perspectives. contributors up global to past in

responses and on this ensure both network speed. each with and our who gets and rate can selective prioritize feedback, we contributor's quantity. and Customers are quality software continually quality We over monitor to

anyone test employees, else. or customers utilize with network own can their or customers, Our prospects, this

marketing, research employees, digital underrepresented even prospects, and range today of people and design, customers, like platform Our allows using groups, with main digital use experiences human experience. focus other and real wide The and the frequently competitor apps, that customer products. easy products, are audiences audiences an services, insight centers a is and to public, world product range to on test buying a of

experiences. employee platform components. centers HR, experiences, new operations We optimize like emerging to communication customer power also service and optimize The three candidate, of continue and in and hire see training, our support, comes IT and main internal buying to

First, technology them and get find help answer the to and tasks perform questions. audiences specific to

people experience with to moments engage real CxN. help a that faster. surface and concepts, digital machine third, narratives processes, matter to or to and to customer insight These and as video-based hear they organizations generate or design, enable moments help capture apps, key world learning CxN the to technology within technology And based get narratives Second, real of brands. products see

insight agile for quarters see years. platform business environment. speed, delivers human favoring necessary Our and coming scale major today's business We and the the tailwinds several quality, our over

to the we our addition experience In trends, on are customer industry that growing impact trends more transformation recent having business. macro digital and an and two see there

new digital are ones newer Customers there and including some hybrid, types platform multiple experiences, using digital the our immersive, experiences. First, test are today of to of third-party emerging.

meaning blog post can talking year Oculus of test are Schell of Developer experiences. value Metaverse. the last important test example, they Customers a digital also in For or competitor's July chain. website, on in the third-party the experience third-party their published about benefits a to an VR Games in able experiences, testing

large banking brand CxN their and understand popular travel delivery FinTech open on and up shows can food airlines sites, institutions test booking financial example, platforms. capture menu to test emerging can can initiatives; third-party and on how For quick-service restaurants

digital optimization channel Second, trusted model marketing we opposed more and privacy. consumer the honest as see move today. to and a growing tracking conversation will trend and this teams to surveillance by many their and feedback customers, with companies We in place so opt-in around a believe

the their an platform, I single every in and the sharing opt-in is they're organization. Importantly, all of their sharing this that through screen process, with Within they that customer perspectives to knows the gathered experience process. participants knows want being highlight that feedback UserTesting recorded thoughts narrative an on are

their how This being that they for are contributors great is customers. how and built input. they asked Our value trust show their relationships are value and companies

and providing with trust a understand perspective consumers, tracking the act we opt-in of tools and the on for where to want As this don't endlessly relationships to surveillance. be customers and being sick and believe appreciate tracked away of from shift ask have truly UserTesting I for companies on are That at customers, feedback doesn't learnings build digital and that to heard. being online. and and We customer's is relationship the are do honest feedback. a way asked. always we mean listen companies importantly, their beginning

With in multiple growth To parallel. customer we under are this market rich these a capture broad experiences insight and understanding tailwinds, drivers in using pursuing provides we believe penetrated human opportunity.

invest in new and support customers sales a to to marketing sizes. to go-to-market all to acquire scalable continue continuing model of leveraging we're new First, customer growth

quarter the expanded Shop, Lowe's, landed we great with AMC Entertainment, SA. Group, or As Collective Vestiaire fourth including in Airlines, Hawaiian an some Reddit, Phoenix and customers, MetLife, example Home Anheuser-Busch, Philips,

a international prior including in represented presence, We investments of in establishment Scotland year office the total the in revenue revenue. in XX% with increased and Singapore XXXX continue XX% in of international sales fourth compared quarter, and XXXX. Edinburgh, our In to the period growing make

platform and our to we innovate Second, expand and continue technology.

to path, other at early building video highlight a key the into click reseller our segments customers we're insight quantitative phases and and quickly out to then third, moments qualitative better improving rate understand insight, experience. and the of understand human a points research, Our level within UserTesting key to get rich and of sizes ability sentiment, and drill technology to video run analytics in analyze activity program. And partner can of use where base study is broader larger sample feedback

the better areas with and include Metric. working understand Quantum business focus resellers. with companies This and announced partnership help integrators, partnership of needs Our digital new just impact We system quantify experiences. a agencies, will customer

go-to-market achieve This we to at leverage us growth. enable continued an will channels scale UserTesting. as time is these of our exciting to be All supporting

to is much recognize our have we we're excited company just milestone, one journey have highlights to and that, it to XXXX do. our our continuing in to the financial of on IPO the achieved With this our I'll We you while ahead, to look of in discuss forward more we Jon Looking more that to quarters updating detail. over turn and momentum in all come. step

Jon Pexton

saw for revenue in and everyone. the announce for record rates. was good it XXXX. and Andy retention year to excited of financial our company. growth, including additions, Today, margin metrics, net We results Thanks afternoon many improvements the customer a improvement, I'm

prior the $XX the $XXX of increased of XX%. $XXX UserTesting Subscription to increased $XX for with let's XX%. increased full quarter million Revenue So, revenue increased million highlights. Subscription fourth million strong the XX% year of team. key revenue financial year-over-year million begin Revenue the compared XX% of execution of for behind the year.

and continued Importantly, based, international our in segments, growth including performance progress our retention all geographies. dollar rates in improved is across net customers broad

year-over-year. retention quarter, We of dollar-based net customers, up ended XX% our with fourth fourth the rate quarter up X,XXX XXX% the in in was from Specifically, XXX% quarter XXXX. the

quarter, year-over-year an We an over in large time. also revenue customer customers change liabilities ended Calculated into expand International in $XX XX% the ARR, of large or category which land our was and of customers year-over-year. with was of quarterly million Most a contract fourth amount increase. year-over-year below increase $XXX,XXX that which quarter XXX the billings, revenue XX% those plus is X.X revenues. quarterly of million, total XX% the was XX% representing increase over

operating gross in the non-GAAP $X.X quarter As measures I of specified. in non-GAAP flow, million press be $X.X about Operating GAAP which I'll the included is to loss, year period. loss expenses, prior margins, referring A cash compares talked to release. earnings to unless million, today's reconciliation free otherwise fourth was in measures

from Free margin to of was right-size. margin had points minus year operating cash We approximately million with to points $XXX the in basis turnover basis operating our collections XX%, XX%, the of timing and minus full the Our Free year in margin collections December, we from minus flow working that year the the This team by on $XX was year XXXX. of million in improvement minus earlier. cash which brings approximately was cash. XXX XX%. ended quarter we're for flow improved a XXX impacted

numbers increase ago little fourth we guidance. the dig deeper XX%, before compared go Gross to in in was period. the a Let's an margin XX% into the into quarter year

to XX%, compared the the full the in margin gross Subscription year in XXXX. XX% ago margin compared XX% fourth XXXX, quarter was to year For gross XX% an in was period. increase

For XXX was from XX% basis in increase of year which an approximately points subscription XX% full was gross margin the XXXX.

our in for basis, corresponding fourth subscription quarter, you look declines network. it in first margins quarterly the second we the in to at and The part, fluctuations will our you years, driven as quarters. usage and payments seasonality highest the by and on past see three then If the the subsequent with contributor are gross a see

been It able market. We sales Turning to that in period expenses, payback revenue. of to outside of increases. in fourth year professional our position impressed global preparing XX%. the quarter prior of sales as spending XX% reasonable. our to drive payback in XX% in expense a to and range in the period. adopt to period. We at of growth believe compared willingness the the marketing leverage about in invest quarter, and how some in is and our compared continue the was people, revenue saw in to leadership XX% at a solution year prior the due its the of The increase we period, and that deploy percentage systems, fourth maintaining marketing the to our G&A of public When investment, In to quarter in services fourth to revenue market approximately as prior to XXXX, become to also primarily says state the segment XX% by was company. operating increase which and the compared R&D XXXX organization in to in we expense XX% while investments calculations, year look a of we increased something period we've I'm additional that revenue activity

mentioned As prior compared to and before, to the points of quarter XXX our periods. margin operating investments in the year expenses, XXXX were fourth I these and even the by with year basis full able improve both operating we approximately

guidance. onto Now,

with momentum. We are entering good XXXX business

growth guiding we the a million, $XXX.X to to rate are to million year, revenue $XXX.X For of XX%. full XX% representing

behind first expected subscription a initially growth period. outcome XX%. tax $XX to in year or the will $X.X rate that quarter million, increase benefit prior for was of of to This most sales a is the sales contingency full liability reduction revenue the expect reserved that first The that million rate accounting a reversal reserve quarter. due $XX potential revenue efforts by subscription For the to of to as a than million to higher guidance, of the in related our tax favorable will in is remediation The of XX% an quarter, mostly recorded a one-time first growth put us. we revenue

implies non-GAAP expect in the we of midpoint XXXX. to range range at year, full decrease operating which minus in approximately a minus basis compared the the For to XX% operating of XXX that margin XX%, margin points of

XX%, the margins quarter, operating minus of and non-GAAP the XX% For the to minus range which the we basis first of improvement the implies in margin first expect approximately in range at to point operating XXX midpoint compared accounting quarter to due first subscription XXXX. operating the in increase margin mentioned than in $X.X year benefit that is full just I The first revenue by will of better quarter. quarter million guidance the the one-time the

limit other We to end in we coming are restrictions operating an to temporary also expect favorability those due some expenses as to and meetings pandemic. we of travel COVID soon. the hope continue We

that now January, a we will first team in hold together planned the sales the quarter event the expense plan planning as our for postponed third to expect kickoff example, from training quarter where global result. which For the sales quarter, sessions. We we and to event third in bring shift

more better quarterly operating of and volatility expected that measure year full a loss, of focus trends. number our operating I the loss some as with on So, financial would encourage

For the shares per non-GAAP $X.XX, loss share we minus $X.XX minus weighted assuming year, net XXX and full between average outstanding. million expect

first of quarter, the and net minus per share we For minus outstanding. between assuming shares XXX.X non-GAAP loss million expect weighted $X.XX, average $X.XX

seasonality quarter to quarter the is of For with fourth our the line quarter performance, the and first and usually quarter is strongest for purposes XXXX. fourth we business is occurs normal our usually where expect billings compared softest. to that a in the consistent in billings, our the calculated decline in first quarter with modeling historical This

human quarter Payments the the our seen to seasonality in consistent to usually decline We UserTesting are lower the we about contributor customers, that, that particularly organizations open for call have way we and large quarter great record experiences is operating well better prospects, improved With Overall, Operator, help for to prompt will we the us. is season. with past. margin, are growth, quarter, the lower questions. revenues, you also improved compared to questions? we margin achieved very up real of for others. we'll with are ahead customers, critical expect the to during pioneering with network in fourth margins, and opportunity please insight. due fourth have employees, as gross excited to subscription activity It pleased gross do for with holiday the them customer our a strong the market

Operator

you. Thank

with Stan We will questions. session. the line Morgan first now of proceed be questions Stanley. Zlotsky conducting Please [Operator a question-and-answer from Instructions] come Our your with

Stan Zlotsky

Perfect. Thank and a guys you much very so Very, exciting. company. on your public as call congratulations first

as what just way kick for that right, So, need are level, approaching UserTesting At as very a the are seeing you things high far the companies product. maybe off.

As change do marketplace? you have XXXX, XXXX? expect is really what you that's And to big carry to we taking through a that over into you went the a stood as then in follow-up? quick how place out go And

Andy MacMillan

Appreciate right, the All question. thanks, Stan.

I think we're But for to leverage share that on demand continued coming the results core year into for finding seeing wanting what our is as get is organizations on people to our we we and the of provide more where broadly. platform through this more year, last went and we us wanting platform. emerging see they're feedback opportunity kind

to expand together of actually for platform. we self-service not seeing more more marketing core our around out product cases teams research they're of feedback but our on we've helping how sort focus from own just some the broadly, in work use so teams And design their more started and in and questions, and on

into opportunity think to. there's So, and that we're our really up team speak to gearing there leaning an I

Stan Zlotsky

very moving that puts retention, impressive, are Perfect. as into forward? a move the what takes XXXX? into to should wanting that behind number about be result. just we we And XXX% thinking And and revenue then quick How dig net follow-up,

Andy MacMillan

and I the we in Like for model at a and blended to to found of projected But good customers of is how it's was in get that to of sell going of is variety some to kind models going can, get to rates think we rate the across and to with at. rates. -- numbers the pricing way out had business, small, a pre-product up where figure segments, to expected fit case even try any market number go-to-market try helped when forward retention pretty across mind, the continue XXX%, day in us we down like that one XXX% to with our made of I world, right things different us. continue what Yes, those that companies are looking now drive We we we our it's wide every enterprises motion, I sort the think improvements mark. we keep as into enterprise largest SaaS SaaS a but a those for where rate company, We're think, blended SMB. to all that we're that successful any make happy feel some

Stan Zlotsky

Perfect. Thanks, guys.

Jon Pexton

Stan. Thanks

Andy MacMillan

you. Thank

Operator

you. Thank

next your from Murphy line Mark JPMorgan. the questions. proceed of come with Please questions Our with

Unidentified Analyst

of Hey, behalf of larger pretty their today? understand organization? Is cases, is kind of tests into that I to that used that a the the ml Or largely expansion it just that on with capabilities guys are allows of it driving the some what you're because is emerging drive driving seeing throughput usage in you so you as that core customers my of the start AI large maybe cases further that congratulations that to used Marc. do them of is I [indiscernible] echo us Great. its help could seeing Andy, well. the impressive. expansion

Andy MacMillan

part on makes platform, the in we and sort their that more solution. product large are that obvious. whatever that they feedback feedback run you awareness an drive of the to see empower built, in when I'm should based. Yes, own to people talked this people it's more itself, things see tests that In when things that the the format. see that that they the use powerful help about When these mean, that opportunity to of thing we really teams and most the us broad sense, platform, share that organization. video from one being UserTesting, get across I people it's doing largely go, to We're appreciate them for organizations, It marketing, might through retrospect, output I've there's I still that a is the designing I be. apply awareness-constrained question.

feedback, drives cases. mentioned, drives sort that so of I one other can the the ways you it been I it platform. when of also rally do platform, more It all this and of run the focus And things in on and of the test, the And platform. highlight If the more organization that's use seats, someone of get great all I and using to usage around drives you our more with I'm use people the a more platform, templates it, people and it. more things drives

think I that So, we're had all core some in that and drive sort helping is driving opportunity. awareness an it I as we've of just in to comes focus our of seeing motion, and that customers back expand companies awareness think of area being

Unidentified Analyst

One about What update quick pricing of should you revenue we year? flex with you front? on over respect that space product, think customer next seeing the base us bookings are pricing? Can it. to adoption follow-up. flex on the Got the maybe How this

Andy MacMillan

I was customers to to we to product, more more us alignment And told see continue want in really as revenue they still model. was need with I it just in to increase per our in what just we to the spoken before, people or want new It's customers. designed be adoption roll pricing price not out and to the we seats. a designed from change strong feedback Again, about listened publicly it sometimes how really Yes, customer. to of a the be buy

have want test seats, more volume. just to the Sometimes run that people

the before all sort we of of the the that the a to customers enabling companies most as out does about in And We rolled platform. that selecting become combination segments, second in whatever really we so and they're part option with our team made last by of best buy majority for sense of our vast publicly did talked along. it started when to roll for sales we've went our out of year, half as them,

year see one for sales our customer to to And we strong continue that so pricing great demand it's every enabled model, really still the model with of it, feedback bit we sell flex-based go while ended early a the teams and on days. pricing

Unidentified Analyst

Got it. you. Thank

Andy MacMillan

you. Thank

Operator

you. Thank

Our next with questions Terry Tillman line with come the Please from questions. proceed your Truist. of

Terry Tillman

afternoon, the Jon, and maybe Yes, good Congratulations IPO Andy, Erica. I'll being and writer now. echo a the your on on on also, book. congratulations Andy,

Andy MacMillan

Thank you, Terry.

Terry Tillman

opportunities question first mention human my market as For to and see is so lot to What want get and would example, sell to to starting see guys actually brands. that curious executives large they you to would some some relates look level level and did Yes, you evolves just kind competitor about insight testing C attention? a I'm something just are sounds of. me, higher a are leader, the new you it customers C like be of space enterprise like

So, I'm on? had of a this then you the C see And for level Jon. can to market and get sell of you mindshare evolution executives curious, follow-up earlier where starting are kind I more with higher

Andy MacMillan

culture came for it Yes, competitors, -- like these out to Chief Wiley organization, the does you it's that connects point point. competitor teams some And ideas about your illuminate month. used how Officer, a understand as I book do insights it I that a only aren't test And a these great well, which company dynamics. Estes, Terry, really is also aware, think book, published Janelle cases, align experiences, not you I really great think and to think of be which executive with as what market this I wrote for by that customer. an about that's test to a can those actually your around It's

And what think sharing a how get of like different segments, do going it's in our so the to through to team my see about or businesses transformation, maybe different the narratives, starting with empathy, I the we're be backgrounds. the understanding customer savvy executives

that's is about for comment. us. echo that every just every awareness, driving think what have that segment. that's level broadly point, and conversations. And and into previous lot of our the in think to to at teams is in a get to doing just organization. we're investments, I so opportunity at And marketing, big around lot And sales every level been a A my I our where today sales of in marketing I'll empowering that's more your

Terry Tillman

Got Thanks curious, a a in I back follow-up Jon, cash collections. it. see Andy. where, reversal that, to guess, of for quick kind And you we up see you. benefits, about post do we the second versus you just question first out? know, perking called quarter a what half, Thank snap should I'm capital of working or how on we fourth half think the and

Jon Pexton

the had people going turnover on DSO And hard hire up Terry, And you'll days up it's working of -- we us during collections holidays. -- team our in and that on to number kind popped see right-size still to QX. of it Yes, in the we're meaningfully.

going not a snap expect days. us -- back to little I XX be track So, on quarters. take time. over two it's bit just next in the It's to It's get going to back a

Terry Tillman

you. Thank Understood.

Operator

you. Thank

questions next line Please from Our Canaccord. come questions. with DJ the of proceed your Hynes with

DJ Hynes

guys, most you Hey, And a awareness? you say times. today? can the asked to the thing significant back one couple Andy enterprise want it put increase If would awareness where XX, to cited I is great factor, you've do to to go I of what's here. scale you to start like, a awareness on

Andy MacMillan

way, to it varies say, would bit try I By to a little which I split appreciate. not hairs on think the I by role. the question,

affinity my know, I'm on what you my think learned all are with someone team, ask you what those UserTesting, but that partnering doing, do learning, think because or maybe things we're I awareness a hey, or and them background, I lot what team go find reasonably really product it I in I'm high, we help helping is, wanted those those doing trying to for drive so change seven. to might these of a you were we're that background if UX folks know audience stories to what my internally those high awareness us. design What with marketing think they're be And together, six, positive what I product to learning very in of and a is folks they're that their telling to is tell research groups. get us other

investing set think solution this broader us, a think already you marketing awareness that to quite that of internally, champion us collaborative product I our bit sort So, go think of I if I folks management really plays still the teams, know is in is why lower. opportunity. that's which we're were to help teams, And

DJ Hynes

then do replicate? question be about Got you've if competitively pool. diversity mean, you this it. yes. to this to stacks in up size And I the that others you ask the at easy that Yes, look how others like I you contributor how built Makes space, terms in to would of sense. in pool want And space? a think

Andy MacMillan

bit we is go to dynamic part as this it's doing a I maybe I two of answer well. of while been kind so One there a built up feedback. where this for this have the too, marketplace place a -- we've give a think think is and

year, really a the And is much companies noted qualified X.X second years our start the running on in we million learning for CxNs individuals pull how up our we so in how But is this of data and we the attract our and of is, used you helps platform. those use previous both we and we've new these customer our over when models that score in I think us out big building important, also think rate training we'd this the as more onto that insights the narratives brands piece XX which network of technology and experience had And volume and I that advantage S-X platform, machine think narratives. run of we've last that contributors platform. about and attract

of build has enabled really advantage top that has quality think the itself. of the on contributor us focus of network I output to the network, competitive technology so network the but scale And combination effects the helped a also the build on of the network, network of of what the us

DJ Hynes

yes. helpful. you, Yes, Thank guys. Super

Andy MacMillan

you. Thank

Operator

Thank you.

questions Suri your Blair. with with of proceed Bhavan from next coming William Our the questions. line Please

Bhavan Suri

team quarter it a you, congrats, thanks me really questions. there. let echo I And solid taking and for was Thank my

just touched me of into use bit sort little model. you've with the that concept of Let case new this this jump a on coupled

the all something seen So, are it have that, of different then with the used across use faster expand the of they're one, from you cases help rates types to product new drive there? where that both budget might to manager not constrained because or the those Andy sort was sort think adopt model cases early? questions, guys that be proceed to like model, the through cases, been or out use expansion how that by of broader usage. folks, ask has able question which and seeing me expansion using two one love the of the or And flex I'd two is, you concepts that played of have

Andy MacMillan

thanks Yes, Bhavan.

to Let I really buy a of part more to the enabled seat more say, it's easier they'd magic earlier that to to product which for like saw come product, organization because in we're on access again, enabling for in came of of And and out CxNs marketing the the come an that's have easier seats, board with talking don't of model. where the share this and about motion to the any and it's think first, kind take pricing team. finding we someone some people needed, board, on and them things of me platform was get customers is, as discover seats that is to buy I capacity second the the easily it's one across

might removing just model team to concepts, of need them. sense that's the think the the capacity buy them to growth but those more, companies for I sort friction where made was with to match it for wanted harder a that mix doing Conversely, not made had run seeds. platforms, lot we they if and of other folks combined previously centralized buy tasked the because

think the have And that want in enabled way buy product. what can us customer more to you that do says yes, match centric motion I the we expansion the really so to conversations is is

question awareness, quarters, -- previous I I more think of enabled course old cause cause harder a first there might pricing are removed new think have just that it four those wouldn't us Again, think expansion to got more you good a customers moving say your the improvement an the that is model we of think a I to of over gotten we in has model. what inhibitor model, I continue I have purely the see the great part is taken but to complicated, saw or done to rate we've have driving a the made the pricing that related, might it's our would pricing motion we've we're time. accounts, in

So, around a definitely customer sell fact model unlock, is product and the think has this us we've don't the think think motions and that. I the of new our really I secret. helping a I the only set that do cross got base it's pricing been upsell,

Bhavan Suri

executing anyways, Got right. well, you. its And

the asking, or growing, growth, just So, around trying I'm not I understand think saying and not mean, back. questions, it XX%-plus, holding friction were you're what's it's that to I

a in folks to over old touch Is its level. trained those there maybe a there groups the of that take sort And In capital about more -- playing part? we should that get rate are days, again, tough think set set it SaaS, bit so Because helping, need in the you arms And our you that there to is way. will cloud it's amazingly haven't back the XX% in you're It's And play as time budget, a well. to that organizations I'll do some but people strategic once Is spend it's happen I how things organization. or around and SaaS certainly should trying and a growth are becomes I out the two systems models agencies, on that in different that get obvious. CIOs or may norm? overcome right market little and of that to who friction? video, you pushing saw is firms growth overcome XX% the And over had it's there while they it we do so Software-as-a-Service, I'm for -- get a guys at also it. to or years, research seeing rate but the to it out, see three and thought we way the because is that legacy time? We hated question. is organizations? that? a pricing mentality, while certain of there a or is the certain took from that that obstacle in use really my we a wonder a every of took Or the that and an champions, is

Andy MacMillan

great sense. raw Eureka, makes get a it's of use go, think it. say in would you're one parts. see I come is I you sort One it. When awareness, CxNs I right, of it see and That people two I the it question people is just should back, right?

technology do we I are use is it problem on think this to it at educating and that scale do thing can quickly. you solve the market that to other the that

showed ability go, all technology, have first to it, hard to all them record go you video, people, the they of somebody think be I that to watch all, sounds get it'd right have the pass content. the like find that themselves,

to built that find to qualitative go fact interpret go to the the people that moment, you help think record volume And I you themselves the through to piece. so them that and right easy technology makes we've and data have other it of platform rich right point a that's to the

possible that it's aware and to do aware using technology scale, sort two, it then a I quickly of And did that at so and possible one/two, right, it's efficiently. one,

Operator

Thank you.

next Bracelin come proceed Please with Our the questions. Sandler. with from line your Piper Brent questions of

Brent Bracelin

one Andy Thank you. here. Maybe for

on and market or kind going you person. this is of be you as how seeing are research end kind might of brands sort and that sort given make any Still Just right you the and any market that think end more now? about of of think Are conducting research? kind evidence of viewpoint of just a permanent office change these product place enterprises there return have structural in to happening move it's to get product back

Andy MacMillan

kind Yes, haven't we any structural of back. shift seen

the to person. this most do think aren't complication and folks in bring expense of looking back I to trying

Brent Bracelin

quarter. extent, margin, to well. Perfect. Jon, if as some shortages look subscription, Obviously, are And facing the this I at then you here gross nice uptick labor

in are shortages? contemplating how shortages costs side margins just we the increasing through maybe light sustainable forward subscription contributor you given gross there? Thanks. there seeing margins? subscription, costs, think out just And labor about walk on So, gross the How contributor we're should going of those are

Jon Pexton

Yes.

that up. comments less better, on that So, we being seasonal, is no there's I those around reverse. then studies quarterly contributor bit are QX little And is just a should The you the seasonally, if go so see because it expectation margin costs made holidays. done and appreciate made always a that basis

And And We're model last, range three a so years target and it's the we've of QX, been QX said I And in do but has I past that right bound. as long-term ahead row to now. expect, it the historically, that the think forward, is subscription, margin about in XX%. we're in come down gross going XX%. XX%,

I think we'll in be that range.

four We'll over up that be range. I an basis with stability that think bit. bit pretty But, some think with little And subscription above can some little a a quarters. had probably and pretty, gross was that I float margins. our efficiencies, in next annual that the we've scale good

Brent Bracelin

Helpful Thank you. color.

Jon Pexton

Brent. Thanks

Operator

you. Thank

questions. the Berg Scott come line Needham. with with Our next your Please from proceed of questions

Scott Berg

quarter your taking of size about the and growth the should on Jon, given Andy and got when two. are Hi, have think you feel are And do we to and think fantastic the network? even for thank my the you that where to I you? first there. congrats we the options more that meaningfully for number like you about How questions. guess, they network guess I that customers you and individuals the today, grow forward contributor going to in give geographically Andy,

Andy MacMillan

the at and to the I growing pace the meaningfully, sort grow it know model of market is way it continues of the built. about that's I that think demand don't

of to the really out see network. continue We strong performance

As from great we've times, fast ratings response to customers. grown, continue see we our

and that is so network and the demands to to And meet on and grow customers expand continue global needs our the a basis. we know able of

network we're how happy think to meet continues the market pretty with the need. I So,

Scott Berg

in Got different within maybe versus more but to And it. to quarters your deeper five improvements the is using or or different an particular. don't of a this other How throughout certain think way, of of impact other you're trying that more go follow-up employees only is departments with revenue you terms of maybe of about I the that the should in or know the it if that across if they're organization? kind then we those last set organization, to teams. outside think on a moving understand you just team you've maybe making Thank teams solution improvements my you. color really question in individual retention And year seen in net same it

Andy MacMillan

our hard your our of use a to idea. that. roadshow, team, one templates we a solve which experiences good that a something platform. I on went, it when every talked it was is about our not during broader COVID takes we the whether service of the expansion. what period it's great cases, the I This one things usability with on start problem. what at customers test the of often we did restaurant, little Yes, a user is the when a I create it's do with test didn't together a of food say, put illuminate released was that case the a should use bit that's or about was was It's -- minutes. a template you to same interesting a And couple we can bunch question, you delivery it's say Scott, it's, would a template But did restaurant platform, app

have cases. And to success highlight XXX using our use well those we teams sales teams, are templates so now over deployed our

testing, the somebody platform. around whether pull says, case, a use it's either just that's things case In to who great on the some do used again, that with awareness going hey, more folks next largely the been I'm that's shelf, going it's already of platform. the can do cases that them whether and another the says, do product, using idea. to So, off that who's I'm and person sitting to

Scott Berg

congrats the Excellent, strong on you. quarter. Thank

Andy MacMillan

Thanks Scott..

Operator

you. Thank

of come Our from next Please questions. with Brian the Oppenheimer. line questions proceed Schwartz with your

Unidentified Analyst

RFP, Brian Ari the is up focus displacing like, this agency? other like wondering, subbing displacing? you question my like for and taking are of [indiscernible] Schwartz. go are when was Thanks group for I in guys an Hi, congrats to on like you for Or mainly trying quarter. you understand were are what a like like zoom? also software's a Just guys company maybe a or user Cantar Thanks. you type displacing

Andy MacMillan

probably other a we on a hand, I in Thank it's I think few maker, established of yet answer think we can It's one I interesting just RFPs. displace do spent. less I it great mean, question do last market that see companies is What not an Ari. year, count on being way. certainly effective Yeah, very lot to you. market

people outsource example those status might study, one your research dollars rather market using agency a in and deploy solution So, agile this and an than like of paying for it take outsourced process. embed an technology to

what So, that's see. typically we more

Unidentified Analyst

going about then And you into sense. makes investments another excited are Thanks. question that guess I Thanks, I what are, have most XXXX?

Andy MacMillan

around investments. We're of of insight, people learning technology, work the help getting get some to to access doing more the collaborative on of making our these to the the about the machine in performance excited growing really which think investment excitement, marketing, the to think always I'm terms investments business. I out I and durable about is good see of Yes, sales -- to in But great, see CxNs. capabilities excited people platform, the moments we of were in we're continue a

deliberately those they Some of platform before. where diverse audiences out seeing we maybe the doing getting weren't use like see on organizations more that weren't perspectives things the to cases reaching we're

to use from also put everything story, people on marketing impact out company real just that the our through or the And a mean, that we to telling telling technology. to having we're it's how that's I think think really that's the say sales out the our whether world that marketing field just our doing, we we're our and I work. put I'd dollars expanding story, team important through I the that book

Unidentified Analyst

Thank you.

Andy MacMillan

you. Thank

Operator

Thank you.

the come Brian Please from your Our with questions. with next Peterson Raymond line proceed James. of questions

Brian Peterson

gentlemen. the Thanks taking question afternoon, strong on for the Good quarter. and congrats

maybe Andy, partnership a higher one, just opportunity. So, the level on

of today. having we new business big how awareness, going partners curious are growth forward? a I'm of as impact awareness of opportunities in terms factor and big about of the that driving think driving is So, growth how and And in an kind

Andy MacMillan

one for of the didn't vectors us honest, lend see to it's old We in pricing two is Great It's us. limiting we had question, be partnering Brian. days one model itself to front on growth early our that big partnering. previously, really of factors really

For to it well actually sell sell customers. unlimited a use bunch those of reasonably used of seat, that's partner that to a recall, wouldn't bunch an customers. products times to to for we unlimited will But worked actually use an then direct which to going you obviously want go give a

partnerships, flex-based to partnerships pricing like and new better use actually things for much platform. the that our agency SI want So, works model

with from to those see the value is partner other technology, want they Then removed barrier companies the partnerships. product and is out on who second the in build that market we're we the and one are to side, demand So, us, starting to see product of we've come providing. that continue

start to did One will interest that enable product be really I in set publish think last of going which to us a really during our of to public take the customers. year of is partnerships, advantage to which things the APIs, we was valuable level

but an really of it's say historically. think I would business it's really versus opportunity so leveraging about, we're an something And us area I in front still excited I'm the of

Brian Peterson

be course can share in of for over of of to have follow-up with And progressed size may Jon, on cycles, customers? just the understand, a sales how anything And XXXX. I guys. kind want Thanks land Understood. new maybe those you have that the deals

Jon Pexton

overall, land size been so consistent. Yes, pretty has

that and record customers net the increased growth was you'll quarter. last team see size, on our our the in increased volume we've our largest we've new So, done and we've

when customers blend in land It's expand definitely and of we're a landing out expansion of also a landing land. deals still letting lot So, we're software, a together, large all opportunity. But in past. overall, bringing really we've it them, the a we're motion, people where all more try and pretty consistent then than and six-figure the sizes you done

Brian Peterson

Thanks Jon.

Jon Pexton

Brian. Thanks

Operator

Thank you.

Our Rob questions. with proceed from come line next of the your with questions Baird. Please Oliver

Rob Oliver

nice are taking terms giving you growth and customers, Great. in planted customers, be years, in thousands Thank And have a they of more sense business. Is bigger? early seen for opportunity, on here guys for last maybe also over look the on and I'd in land guys that a international my I around those doing could quick And at customers questions. a you couple meaningful you when becoming My the dollars? of that meaningfully hundreds was question what curious of follow-up -- it's of XXK, the had of international, you just then seeing guys that multiple you do Jon? be from but particular, expand in international have types historic to guys part the land organizations in they of really

Andy MacMillan

it we is North in driving think being business. Again, still to I see what Yes, America see generally analogous awareness. our it we

our others ways, into also motion. makes the markets. go are business more similar segment. we and sell used to that it's We're into expand in internationally, evangelical the I new our We're think every in same sale core things of businesses many that's that evangelizing, one maybe to. We do

the overseas our imagine you'd So, lot customers a as and demands the customers large, needs have of global in global based same U.S.

we many ways, that -- a so a similar And as motion. in see definitely

Rob Oliver

costs. I And about Brent Jon, asked contributor the then, know network Great. earlier Thanks Andy.

So, guys to network many I and abroad. well? that consumers internationally, I to tap guess, -- assume clearly, existing using maybe U.S. to needing about international, and leverage we to to think just I'll of Thank I'll sell get as you just as going tried multinational that expand get more to you companies network. sense more you're for you're to particular going ask relative the in in just costs as a wanted are would should be you. how about add that They contributors therefore But the

Jon Pexton

test Yes, don't a see basis rolling overall to different out on any types per the of cost We're I kind tests. there. of changes still major a on

we've less. test moderated short a some And then could We've paying where pays have we is stuff. we which for that over sessions, $XX. got and live of standard So, that test, got roughly that $XXX be sessions

the So, that customers a kind as use far love would pay the the ways panel. But panel then demand -- drives panel demand -- the of can more of Andy right panel well. different we ways the like, more now, of have And in -- so size as we said, variety for again, tests. panels we're and the looking the

Rob Oliver

it. Got

guys. Thanks Okay. again,

Andy MacMillan

you. Thank

Operator

from Instructions] questions. with of Thank you. Please with [Operator come Our Loop Yun line Capital. proceed questions Kim next your the

Yun Kim

you. Thank

on quarter, strong Jon follow-up on and another Erica. network. also a the Andy, question and congrats Another Andy just Andy. contributor

based to you higher and rates more use in include charging value higher case target network? in who your specialized come CxN, expand audience to can participate different you may on rates As start a

Andy MacMillan

standard find ability heard higher many simplicity hear to from more income we actually as important compensated. the get frankly, to what if especially sort into than the the contributors. we brackets, of being well we our so of desired, being continue is do, have pricing we works It's technically, Interestingly a where market, something now in we is, lot

flyer almost done think it's don't frankly, different who's the for and that premium to that really quarters different to their scenarios a compensation own more need, that have of pool professional, going one of access perk customers, a So, employees these see says, folks over participants, in their that often loyalty the few is see a kind their maybe a se. this as level the be so they folks expertise, customer paying about brands I a of levels I'd them us be own and set provide we've we value now, these to where need when to past is bring use I right per BXB of enabling add company companies, of things ability to be just a what it heard. also or feedback you I I for expertise, a have or someone is these also that a for hey, that. whether really technology And and

so. think the now, right simplicity to model of entire I But do again, is So, we the sort happen. that, should ability of the do magic have what choose makes to we the

Yun Kim

Okay, Jon, you pricing early up numbers model? are larger change number of sign or seeing of their great. back higher under you And new CxNs they for frequency then, renewals, And to any also the deals? do customers contract length use for coming allotted billings or a

Jon Pexton

doing of units, can sometimes, spread a they then over that changes. multi-year. some and major they show comes out then up consumption bucket in multi-year the And We're deals. the doing can and have vast majority still deals, more probably the XX-K. number no annual that'll if multi-year deals the people larger by But are So, in RPO basically, that want to a

terms. keep So, of that's deals, the still time. their one simple kind to it's and contract of driver business every we year it been a are we -- longer vast But earn want majority

Yun Kim

the about early renewals What pricing for under customers new those the model?

Jon Pexton

Yes, then value some they the be the early usage terms significant reload environment. on to or for going or that, credits, top platform, that's the in contract if up again, do billings not of to half on is need off up so can macro renewal not they

Yun Kim

Thank great. so much. you Okay,

Operator

any to the comments. this to further like are There you. MacMillan I would Thank closing no turn Andy over for time. call back questions at

Andy MacMillan

the more forward Jon want again to I joining share Thanks results for and tell an operator, calls honor about tell and the these our we're to our I Darryl, appreciate our look say for you UserTesting. It's our and for to just to and story. in business. All We thank really you continue and with right, the our customers, partners. employees, proud future to you help to to your interest everyone call. the thank call

has thanks time your and and with again that a everyone questions. So, week your great for we hope

Operator

today's appreciate participation. conclude We does your teleconference. This

your lines at the time. day. rest your this disconnect may You Enjoy of

UserTesting (USER) 1 Mar 222021 Q4 Earnings call transcript