YEXT - Earnings call transcript Q2 2025

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Operator

Good day, and welcome to the Yext, Inc.

Second Quarter Fiscal 2025 Financial Results Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Nils Erdmann. Please go ahead. .

Nils Erdmann

Board; good Earnings Welcome today Conference and of and Quarter Yext's are operator, CFO, Chair XXXX and Fiscal Call. the you, afternoon, to everyone. Second CEO Daryl Thank Bond. Walrath Mike With me

of statements, of our we opportunities strategy and future to operating second quarter regarding full Hearsay described forward-looking XXXX, statements including the . These [indiscernible] financial Systems, certain forward-looking to performance, our and management with and industry, of our economic fiscal performance growth statements expected third statements related expectations During this effects make our acquisition in to as including risks, of letter. outlook call, related estimates These the and growth, and evolution our general that year this only no made, assumptions, success, Systems metrics, reflect we integrate other and and and regarding uncertainties ability for update of of those will business, indications as our our the our statements and expenditures financial capital shareholder date of obligation and the subject to quarter to business product our Yext's call. forward-looking future integration our the our undertake beliefs are ours, after any and changes statements revise the assumptions or represent occur conditions. to business development further

afternoon. section for Form our ended X other XXXX, Note risks months the earnings July X our that these Forward-Looking with and titled this recently could reports factors from in Statements the and filed forward-looking to regarding and most and including on and information Risk included quarterly the differ in letter issued Special SEC, release actual report our is were Further XX, that cause on shareholder results statements materially Factors filed XX-Q our

most comparable financial including available are historical which call, in the Reconciliations to GAAP letter, certain investors.yext.com. the measures. also with refer During at metrics, shareholder measures we non-GAAP the available is

definitions in provide these also metrics shareholder the letter. of We

will that, Mike. now to over I call With turn the

Michael Walrath

by letter to Everyone, thanks for quarter which go of do release chance joining had to was second a questions. as today. like read website your press as the shareholders. can well us after our and We the to posted to right our We'd now. that our now, market. jump ahead close into you've Hopefully,

Operator

with [Operator Instructions] And comes D.A. first our from White question today Tom Davidson.

Thomas White

changed Hearsay, year full And new Two, guide. is first guess, of the Or updated around could. if the only Hearsay arithmetic change revenue guide kind of if related the to outlook the core -- change million. any $XX on contribution? business? here, there just -- implies off, a I the I I that to all revenue Is in maybe number my is maybe for guess says say, a to

I And it think revenues follow-up. me last year. square I've did X then million help $XX got a just you things? those you maybe in said Can

Darryl Bond

X includes the Yes, guide ARR the Daryl. August had said quarters $XX acquisition full full on Tom, we it's Hearsay Hearsay and since we X, the around and QX Previously, million. of revenue. closed was year Hearsay

year, the accelerate synergies We've and got sort are of off of top how to the based of at numbers. adding the joint of Hearsay the about we So is talked look what to not we sure can that. I'm in our second business. legacy starting line when sort infer and you to revenue that But available both you balance kind the go-to-market the continue half. business Hearsay your the the for business motions believe we're

is . contemplated that the So guide. all of in

Thomas White

theme of bit by and And The That's how last of you've a of software this couple driven slows when of Mike. about talked one, Okay. level customers. consolidation quarters, broader vendors that's helpful. market a higher just the kind then kind maybe broader of

a what's up things looking loosening products are for maybe a little other what kind bit? cycle to portfolio kind could that Or you kind think just of seeing right you're you in hoping that bit now? Just any where if of sort continues. your this consolidation or about Do of signs the not, if add to general talk we theme appetite sort potentially are of of

Michael Walrath

Yes. question, Tom. No, the for thanks

we see has been this kind our environment. in we're would think of what and to So thesis, this I seeing expect

smaller last hearing the of have I've we're spending really the our They that weeks with So It's software. on our with much particularly And teams, vertical since customers the X we've creating been lot same closed particularly last themes than again. over time a acquisition. all are customers Hearsay and their they which themes. been. same over too the and have It's workload over joint

makes platforms, too inability these inconsistencies, is consolidation So analytics many data the vertical so too sense. This much much software, why to siloed technologies. run across

why the it's reasons positive reaction a customers. our of And so seen one we've also from such shared strong

are So efficient X analytics, how all generative let's to AI promise all on talked a I letter -- a workflows. to being better a in the . And say, in able important of data the coming experience better lot the together of those because going about deliver world. of companies platform, be things more

changed. has that of none So

with the to as recessions, out in the anything, to stack, is seeing their is think this there investment a that from tech time from uncertainty value their a elections, about customers it. are world's risk, amount our think geopolitical really of if the about get lot most that interest of what think how I great figure customers we've seen rates, and

conversations -- just organic than participate broader we in think and our we're we lot started competitors, this. because a of that have sense fortunate in with we're that so a innovation those I going piece any from individual much we're already our getting standpoint, to really the of of And platform

next. we Certainly, go our will customers to should where continue ask we

a the to what's important rationale of a with reboot most deal going here next part big behind is customers this is been us the like we've product, lot which that think yours. do to drive innovation the the had a I having strategic through

the -- personally, So conversations. these I love think I

we I problem get to and map going the into us growth growth that's into is a where of We help and organic opportunities. going, get inorganic road solving customers. build with think puck

of our and And framework, the things inorganically third organic I positive opportunities create our letter expanding One investing lay that pillar out in how the did from in antidilution a of obviously, a of shareholders. the value-driving that think a those shares the buy back ability to growth, is where exist. then effect to we long-term is really as both

Operator

Kulkarni Partners. Capital from comes question with next Rohit ROTH Our

Rohit Kulkarni

think -- is questions. of upsell do the into kind [indiscernible] mentioned greatest to of on lowest half How excluding is in the you customer, by XX you the digits where and a upsell in high or next couple fruit A Hearsay I this One year. could months. that do get I of base? think how And into feel you ARR mid-single of digits first single earlier hanging the loss large organic growth next Hearsay think X, customer end of X, year

latest AI I other organic could update And -- on your you then questions. are have on what then that Gen on wondering based Hearsay. based perhaps growth couple Just thoughts a and of

Michael Walrath

Sure.

question, for Rohit. thanks the So

relationships So workflows and opportunity more of who I the Hearsay, both have think the customers several with really excited time, and create are about. first are unifying customers mentioned, something question, value, to Yext I that's analytics, the that are there's an there by data opportunities. on the customers joint platform, as Where our we over

only a customer the are us for opportunities with remains -- -- to can -- be discussions in look we actionable we've saved, much Hearsay I we have save a And at because that the can software, many may consolidation it's back is we lot or things have the and operating systems we cost mean ways of too too. I where well, too running in most versa. one we software all when tailwind the expense, have an When -- inefficient. software can different the throughout just -- systems the vertical of that money, people a the customers may as a vice becomes diversity moving between ones people of the that's these this on overbuy business, we when forth at there's those think it and of Probably the work when operational opportunities the -- done doesn't not are Yext expense. and and day, pieces can are theme Yext load software the where it overlook

a partnership conversations conversation thing Hearsay where we see acquisition the -- quickly And those so a how is turned best from about with the really are being the most conversation or customers about have or probably Yext the far So Hearsay the a discussion. opportunities.

it's isn't of meeting it's businesses seen is say, indistinguishable Yext value customers opportunity. there -- opportunity a almost so this and do the for and with -- things I've how quickly customer and opportunity remarkable And merging we a one are really these Hearsay immediately is or together create very the

really encouraging. So that's

the stability going picture. year And on of things year the I've that overall we're ARR about environment. your of of the year, an And thinking And CEOs about think the think lot in seeing this was we second in lot to question of improvement I entered we growth. for also risk. other ARR organic talked software be a to accounting this we're a I in this letter lot one entered talked was a that all and this, that is

look in couple half about going how that. a We a year evidence cautious on talk haven't And approach of take seen we the factors ARR times already, the of the growth. expected laid risk as we're second just that out I've to of at we

stable by going -- us, be maybe we in how that. So pleasantly but we'll we're environment look growth at we be to year. overall in an conservative And is to just total, say I in would surprised expect what modest ARR that this we helps

Rohit Kulkarni

and guess the say is I fact last the the to half AI you I'll I'd where that Gen commentary coming. interpretation the that take Great. like that full wave Okay. around

and when conversations reasonable more would you the And bookings? period driver start and what to kind to tool So a more over how or that's of you how make? feel would move Gen that to deals as and the essentially you perhaps about do enterprises puts needle talk AI and provide are start with from around to in thinking assumption takes be related and your decision-makers

Michael Walrath

Yes.

not And then you this of an we I've is which where phase, And entered which industry as this ourselves been now, we producing anyone a lot really, for beyond been -- a value I've obviously, few commented, of to this asking but of get we're of AI probably workloads, bit [indiscernible] little it's not long driving sort seen AI certainly and wave it's I I support real not has that and it's that's living the too think broadly I excited as would because it's bookings think build-out, before. we're lot driving around I a is hardware driving really cycles been driving think of the the of know, think and a -- drive. ton we a were is on topic. these hoping infrastructure -- it's So as a of

even of and me late then the long and reminds than when my it now teeth was Internet we it of when and now, right this it -- mobile right have 'XXs so but kind in happen, turns just it expected. wasn't the where then happened I happening even didn't and time, it cutting it could took lot social a happening a was out bigger then And

X, being draw of it's so And talking X hard couple on a to is value that X, about years, see I time platform. those and X, to years the much just put that generated -- I so what as think don't on the we're and going a talking I to about experiences to going in that's we're through I AI going we're it, frame be see be

that, And your strategy. we about data a lot strategy AI so foundational talk your is to inside Yext

data a that have to see be deliver consumer And that applications experience, to in extraordinary particular, has tailwind. important you're more those across happens, And to the to content the so that and actionable. and that to data using expect more that authoritative, the when organized. strategy be It we going it to becomes experiences, has be that consumer an it's cohesive we has you this be fragmentation it the

health compliance like care. the particularly of through risk enterprises would be going and the high institutions some factors, level are of time-based other I bar, various what large AI the financial services call Now with forms factors consumer LLM engaging for is inside a risk and very to

that will is that -- have to the the comfort and so going technology large enterprises using with And it. the a of outrun the will technology are level -- ability of promise the

the already answer try the now to benefit question thorough flip the coin seeing a that So to it inside give side to of you platform. is, we're

listings we automated dip customers when about water regulated see and And generated very to a like in in So talk review way. the industry. beginning not recommendations using these things technologies like their we're response, is constrained a very everyone toe safe

that sound hopefully, doesn't contradictory. When deliver that it And workflow, the industry, going to we're analytics, software a lot going to innovation componentry and like through a So to way the around is of too will learning going people things the be deliver AI is that. happens, data, platforms an this have right as This while. than it way bigger take we're think.

Operator

Ryan next question from comes with Needham. Our MacDonald

Ryan MacDonald

is you're you've of us not and And to can closed are can to maybe shared or now got Hearsay of remind the cycles some start integration sales -- first you're to just Hearsay of work, what Maybe able customers revenue to synergies? [indiscernible]. how key quickly better the after and some recognize some the your that compared how processes and to the maybe of verticals? you taking one And sort go be you start starting those steps

Michael Walrath

Yes.

So think a -- of cake we a it's kind of layer there. opportunity there's

are I similar similar It's the buying side very process the see and a revenue sales cycles a centers the think I customer a the similar. Yext buyers On same least of lot we think process the things, organization. that's deal Hearsay, same of support very at or between and and within

see data not to layer. I around customer opportunity we mentioned a, there anywhere have discussion the as do a where have -- unified where an And of Hearsay so -- -- who's opportunity a I customer, think before, really and I is a an there we benefits think, will a x platform

a we've know, And and I biggest within platform. talking -- we've XX also in investment the as GA over services, [indiscernible] we social nonfinancial the made last product about management letter. days analytics the we're from a getting you to think been social in is probably which standpoint months

We've So to had that's there customer We're coming. really it. think be going nice addition going the excited a it's portfolio. really large we and about to there, data a

it there team. products, functionality potentially say, to be also As services Yext many products to beyond vertical opportunities Hearsay here, financial core the we to integrate core bring and the going are take -- and extend those services financial

bit need So that And that, I time through need we a patiently that work of this. to we organizationally, whole map of going -- to little fortunately, element a we're approach this, obviously, the we're road there's time product out. that all how to too. And manage to have think figure we because to going

teams element, of bring cost synergy, and the with margin that together There's but there -- obviously see synergies and to be alluding it end the opportunities improving and kind both the revenue to for low upside single which by cost the clearly side a the other is are low going to well, us of as consolidated part of which outlook year. XXs in of the year, us next you what upon drive is

Ryan MacDonald

color there. the on adjusted EBITDA that on wanted ask Appreciate to margin. the I

the exiting business margin that there a the driven? of adjusted there kind as now primarily growth still that to margin fiscal right to about seeing leverage well? synergy incremental in or the So is Or you are in that potential core dilutive as -- is say much of EBITDA is upon is the 'XX and XXs expansion is you're consolidated low you point, at that EBITDA talk it assume year bit

Darryl Bond

Yes. Daryl. Ryan, it's

first of the dilutive margins. that component businesses includes bit right. margin is is consolidated [indiscernible] we that Hearsay think the guided to The part I to both and little overall a

the I X things to it's since from say, we're just X making we're think legacy point. best the do efficiencies putting fiscal of investments off with to we'll And capital, business efficiency business we into returns. us, this Hearsay the year, look to we and or throw because continue next as the way. sort allocating hard efficient we the how integrating get to . And come decisions really an in run businesses at business how and at are are that are going the to legacy business it's to going together, respect

So we set as X don't really just necessarily think it pieces. about different overall It's operations. of one

Michael Walrath

just going to point to opportunities that within made, to Darryl is portfolio Yes, combined and right. that would we're all teams. I to company, we to add which opportunity and when also growth that the the as look deliver our reinforce just innovation, look that's capabilities at unify at deliver a just

And been together. come teams fantastic so it's to the see

and acquisitions. seeing part I think lot of a we're it's -- been of

think the together. how we're seeing are the organization. we're well immediately of really I and together alignment effort . really is cultural seeing There's the just across gratifying whole coming teams what working see it's level and energy and the the teams to

into we the There's of about elements As and there again and then allocate we growth the think investments the X portfolio going we opportunity to to be determine we go and next of margins, how improving to to that more get year there's efficient make. the are opportunity obviously that. as sort also revenue

make to for a not this ourselves then And kind headwind companies where point this opportunity setting advantage. the be get a progress. lot really -- I will that We predicting and really because will do think consolidation and be a is a for breadth I'm that's huge and a the we're a up and gets other of some companies interesting tailwind of there market believe stop macro through we comes where short going of point, I'm to -- when

for technology type I we of we in going time, proposition and and just easier, of some gets work like operating Even have the feel we of hyperbuying in the environment, as some of what better. -- capabilities environment. be those environment And I think years to call think strong quite make kind XX, XX still to there's unify value the digestion things that very platforms would

Operator

from [Operator B. Instructions] Our next Khan Naved . question Riley Securities. with comes

Naved Khan

on which you pretty in to and quarter, trends curious get the the I'm as fact encouraging. you're on continuing used about back, these also and if for managed and the the just the these they terms coming as see are quarter be to into be what Boomerang that primary that's to coming last coming similar customers tiers they So may back? them terms And on commentary well? customers reasons third back are

Michael Walrath

Yes.

So thanks for about thrilled the Naved. question, this. we're Yes,

has I There's a tremendous years. amount well think pressure. it's been been tough that competitive couple it known of a of

a And always are one delivered is promises promises things that seeing those think upon. we're lot made. I of not the of

to the And the think, so months that things done doing particularly last, when happens, one we're isn't we've, that better thing be it you XX right? that a enormous over ready that can environment, clear in back, this for ROI help left working, [indiscernible]. the to type our that I of of implications job is customers making And of them the come of

What you traffic, be it organic the if can losing you're is less a you're fragmenting your competitive center for search -- business. in devastating rapidly of the look at if world,

for renewal our happening been pages are -- also a making the left solve to because them mindset it's infrastructure We the -- for who we customer revert a delivered lot been and to and the have so get feel and and the long-term possible as we're they're to just easy cycles. able reviews, -- they've of in And having. to the We're promised as to very companies quickly faster to a a it back. partner to come or hasn't as And be able back. value that taking cases, whether listings challenges relationships we're or maintain back -- to up running is this lot of partnership

get teams quickly. the it's when partnership-minded to close and the even that go credit think a can staying up decide solutions to our experiment So with this really we back to customers. is the a and customers other really we running trend remaining

put is this partnership mindset team but value hard it value global is -- the on a a to on want credit different it, I And think It's a to just creates long-term and that lot. this. it's I

Naved Khan

to great then a hear. follow-up. That's quick maybe And

the quarter, give back the third the color into full range, on kind kind for of the some EBITDA if just versus just in us just of fourth guidance margin So wondering implies I'm quarter. think somewhere I how the to that. about for year off on it mid-XXs to If try or

Darryl Bond

Naved, it's Darryl.

QX a kind And talk mid-XXs, the that. I about is think And we EBITDA the I Hearsay we When said, XX%. around about of to little Mike as finding think think year, a margin benefit from implied through is to but next margins, continue getting we of getting X if I talked minutes bit to look you at some the there. efficiencies business, we up where the legacy that's business both, into as ago, get [indiscernible]. is dilutive expand hopefully opportunity the couple see into also like in

Naved Khan

last And may. I if it. Got question,

So move contractual usage-based third-party things. maybe reseller side this on just of to the from

lead really the to to Just that of kind is seen what move? affect this of just kind kind And it if dynamics kind change? of doesn't of [indiscernible] then are revenue, what driving

Michael Walrath

Yes.

to to the -- set is customers follow too. this companies deliver in commit certain this of it's customer what don't to an I a be -- easy default think of committed I always spend platform, have a opportunities, missing part under to level we who business, -- of we've what and who centricity. they that been might -- under So a I think want determined cases, this has there's a would would we but it's of predictability file want revenue -- lot but I the sometimes want been been that

going they trying want make flexibility commitment lot our what of a like the that commits more products create here fairly they customers be. many customer cases, a and we're so in the better and -- -- to is lot to to of lot And that do the pricing a of a -- someone volume think simple, for I is to, many, of in any it's want

of we business, to might business a But a at might growing I to who own needed stage, who be be commitments like we felt to have from were type probably whose structure less less probably where of predictability that it a their point business the smaller demanding commitment business. think customers might it a over-rotated a

And it's there's meeting been might making are deal shift customers always sure that where might a so has as really, just to or focus trade. our It and a a that not for pricing they less be -- no commitment good the commitment. unit

trying what we this, can So on it think on conservatively, dampening committed I reported effect the ARR have we're is contractually we report light only to a ARR. as shine because here that do

change you'll as we've this as we been to we'll right reseller you'll the the committed report what's quarters, not ARR, as move to you there. and figure signaling forward for we now. we'll give kind number you to revenue we at here, to be look that will the for couple And also try help going at but going plans And I trend, to have ARR way clear a don't We're the that and business. -- to think have of on around out possible. make But able so of indications least try this some

I quarter million-ish, for and So ARR it sense. out. revenue reseller you But is as go call of make there if then at flatness look you that kind this thing, days that out the revenue. we that to just in of there's you the get for kind quarter $X the think, we call obviously, in we committed of basically drop wanted Hopefully business. adjust forward, kind And was some in the what continue to because that

Naved Khan

details. It the does. Appreciate Thank you guys.

Michael Walrath

pleasure. My

Operator

concludes for the question-and-answer to to I back over turn session. closing Walrath any conference Mike That remarks. our like would

Michael Walrath

like remiss joining an just acknowledge our amazing And to to is global listening just possible on would team many doing for value time for value us to job at focusing the the to our more one are I and know creation. team. I every want to be thank I'd and this, delivering moment. everyone It take long-term customers not moment, a thank today. again

I time really quarter. you appreciate everyone's So forward speaking to and next today with look

Operator

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

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Yext (YEXT) 4 Sep 242025 Q2 Earnings call transcript