CCCS - Earnings call transcript Q3 2024 | CCC Intelligent Solutions Holdings Inc.

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Operator

Good day, and thank you for standing by, and welcome to CCC Intelligent Solutions Third Quarter Fiscal 2024 Earnings 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, Bill Warmington, Vice President of Investor Relations. Please go ahead.

William Warmington

Thank you, operator. Good afternoon, and thank you all for joining us today to review CCC's third quarter 2024 financial results, which we announced in the press release issued following the close of the market today.

call Herb, Ramamurthy, CCC's the CEO; Chairman on Brian and CFO. me are CCC's Githesh and Joining

annual our The Risk forward-looking uncertainties on is today statements on with Inc. of and risks results and copyright a SEC. Further, Intelligent of the report for and are we website reproduction XX-K results our Form the the make Factors today are United same or actual and of that other violation Holdings the XXXX the laws. vary under the or to profit these filed Investor consent about company's subject discussed Q&A plans CCC the Relations risks materially. the otherwise or and is available and follows and that comments of in prior to States other cause Any Solutions by plans prohibited and recording, retransmission may heading implementation are use copyrighted the CCC These company's release without earnings

Additionally, And of appear will believes is relating turn our company's approved information that a inaccuracies measures earnings useful Relations the no may call, reconciliation for provide of the this transcripts. Please Githesh. available that financial and the trends SEC. the over today's a publishing non-GAAP of GAAP financial A and investors company business transcript transcript I'll management while The you. responsibility of portions Investor as to to the in measures is to call financial non-GAAP non-GAAP provide these defined on our website. Thank call party, condition to we of discussion and measures we've operations. by release now that third certain and take includes available we financial note results regarding on call in this of a certain by the

Githesh Ramamurthy

all to another report of strong for today. that of performance. Thank thanks joining financial quarter you, you us delivered CCC Bill, to and I'm pleased

revenue total X% was above range. CCC's and slightly XXXX, guidance of quarter our year-over-year up $XXX third The million,

X% As a EBITDA onetime reminder, million, in revenue on QX guidance of for by of subscription up was X% Adjusted ahead last a the quarter range. $XXX growth from incremental benefited and year-over-year our year, contract.

margin points up XX basis Our approximately adjusted year-over-year. XX%, was EBITDA

and ]. Our performance expansions durable by expansion, our QX new in renewals contract our and year-to-date business revenue demonstrates [ solid driven growth wins groups category across multiple and margin

like are strong financial is we performance, are our While from are value of insurance today's the P&C customers foundation cover step leg next X I'd growth transformation This propelled It's of how our ] with consistently excited more economy. for even creation we themes. CCC. In and for to solutions. call, change generation the pleased [ the about across realizing shifts, the next improvements capabilities, paradigm

the over multi-store next of also enable economy. XX rollout off is P&C across subsequent to over and many operations. company's third investments CCC adoption to paradigm to architectures transition. the the new the insurance integrated dramatically of the on of our second from is and solutions. has highly of class and from who years scale ONE is preceded transition history, positioned operators connected The have dynamic the generation well ago, tenet power shifts years help collision identify, best-in-class CCC's and key platforms platform. our why uniquely and our cloud-based ability model to our looking more been durable in of back the Internet of capitalize growth a high-impact invest repairs The ahead power emerging industry's technology CCC helped And benefited But

realize architectures, service. further customers and improvements solutions top to on decade, enabled these the customer our in past advanced Over aging investments game in of efficiency

forces operations. repairs and the collision for ahead improvement make our economy essential thousands over approach a use the in replace the at an tools navigate their in these the believe processing consumer our multisided investments an architecture became that primary our consistently more we IX-based macro existing and have intelligence CCC when And remote essential. believe systems. I we X transitions even customers transformational Experience, to Intelligent their are of through shift workflows helped achieve industry daily network of of or artificial operating of step work performance an And COVID-XX short, made for possible by integrations that example, change it event-based to our P&C critically, in having help and mobile, repairers XXX we claims IX for to adoption beginning and customers and without For today, call these insurance experience. We already keep combines insurers of established industry connectivity reasons.

insurance experienced The most or the even complexity, first in challenge and forces. amount accelerating of the proliferation, vehicle consumer whether expectations other complexity industry, the economy dynamics is professionals. changing and P&C pervasive is facing data are participants impacting that the all These

The second retirement being are made ongoing tenured more the most acute the shortages by is labor even people. industry-wide industry's that of

month, We is already can and only unsustainable transformational a this newer strained be solved believe technology that deliver the a burden impact. IX-driven and on to embracing trend result, an every approaches by industry As workers new grows.

of been the $XXX well are over and era. in curve As essential investing key billion have decade. previous million that past Over the annually in R&D in IX to waves, $X the we technologies ahead in

what it tens AI and comes into over deep AI seamlessly economy. is been of the workflows. They've with past deploying of we when surface customers existing The by have scale expertise first be is also mission-critical aggregate We of are building millions while in the customers' integrated dollars. just possible in scratching world's technologies P&C we believe have most And can data to of across sophisticated for from aspects insurance at CCC. AI. use is and the tested cases. already performance. X-figure some leverage of deploying an decade, value now solutions AI our of across These solutions all business the for Where been used high-value hyperlocal still built solutions the of that these these claims hyperscale, billions

complete, and using is The second pickup. place notifications on network might within as CCC these It company The events massive phone architecture for and been ordered, technology IX Today, ready in which handle vehicle bilateral distribution up customer of a their model, powering to this notifications our from our configure multiple set uses or AI-enabled key architecture cloud. new by the can data system event-driven in on workflows. published hoc time. amounts we've business Think may estimate P&C the for insurance place subscribe depending notifications or ad enables business to for those everyone architecture event of and AI. Important the e-mail. the real relevant actions XX,XXX-plus sources also based events take connections include, through parts economy, even investing

can and cloud step the take to CCC is onto extends our the is to the applications, the and speed, they across accelerant an enables This CCC collision for customer Cloud is supplier, improvement change parts among IX easier efficiency can connected systems. customers multiple Cloud, of IX whether that network internal simultaneously ways instantly customers and CCC an solutions auto of place dealer, to value the solutions number further our IX medical partner it and a achieve customer CCC customers, clients With architecture and overlays customer streamlined CCC event-based use layer ecosystem. The performance. with and of increases deploy workflows manufacturer, existing in because a is Cloud that powerful faster insurer, CCC integrations together. provider repairer, Implementation others.

customers the cloud with customer-facing changes investments of ability additional additional of their made deploy our partner from supplementing turn with portfolio operations. I wins to our we've well to and transform each as their as We to so emerging part fastest-growing These of transformation activities quarter. CCC our contract transition technology And remain to our to solutions. like the have completion be journey. that continues We high-impact streamline to growth very they customers been as the stronger even about our the on be progress momentum the we opportunity an customer of would newer support to excited these products. can this next increase and products organizations include our public our solutions

Look, While remains change clients of are benefits slower by these handlers. to solutions deliver solutions these the to by I backed the with select transformative customers, bringing demonstrated consistent from customers feedback new build conversion customers. innovation to anticipated, solutions continue and thought share pipeline some life doing our internal bottom First experiences AI line ROI solutions. The the these fully how is for what I'd the continues for these portfolio main start quarter I'll velocity we're than enthusiastic navigate about we strong as their processes realize reason management from tool of ROI and that for last with of revenue claim intelligent examples described to our

reminder, variety repairs a First piloting claims applies that has First of using from models a As to it to Look consumers, photos XX and insurer AI receive sources. One of improve other Look insurers top a variety been triage.

Reinspection, time Intelligent review also and have uses more facilities. an each receive likely cycle approval. for quickly the up which of by improvement a to helps losses the reducing resolution streamline their estimates identifying vehicles of days such example, incoming rental help satisfying and quickly for such storage for estimates claims, in results repair repair time this complex millions average from and AI faster providing results facility X early review shortening freeing redirect intelligent reinspection For of shown repairable to reinspectors to seeing more increasingly facility space Early the insurer fees and repair insurers estimates. Insurers total consumer. We're strong at sitting overall year

and insurers double-digit in the to out operating solution to increases the customer show XX top with of and subrogation quarters number value the from QX insurance, substantial piloting in multiple previous in build our have files QX efficiency. Rounding AI-powered on increase the product from the momentum reviewed continues a from delivered tool. We percentage results

feedback is very in from positive. strong has the pipeline subrogation Our customers been contracted and

This add-on that call, opened between on ] being closed. On manufactured. packages, resulting how over launch Jumpstart. X,XXX for The facilities, identify by helping repairs, of facilities, This solution from intelligent last that seconds. Since any we challenged our rate helping automatically facilities, impact an back increased win estimate, and and We uses of [ also recent helps the precisely About repair based collision up and the claims fastest using an in parts to to technicians billion Sheets. have facility fewer are to parts repair is and more vehicles reduce that labor estimates AI and coats in are ONE times. thousands XX% with initial collision in repair ordering hundreds the shorter clients, provides elapsed shops. Mobile to faster, reduces of manual repair we of the vehicle every about X insurers half For introduced facilities. auto get repaired dramatically Build takes providing paint thousands vehicle road vehicle-specific days positively year mentioned earnings signed estimates cycle hour on was generate seeing estimating repair the CCC's now history. consumers, effort, errors to written and also was adoption facility a have identifies repair time and of repairs of July, product generating CCC CCC technicians of repair Jumpstart. XX Jumpstart it the approximately that adoption data I repairs our and the product solution

collision the thousands beyond our We of XXX% begun technology of of and to forward. CCC converting extensions solution now our paradigm product the pilot CCC collision established category has of early going economy also and shift CCC of also CCC, variety ONE. The the for other ONE peace P&C that transformation payroll repair the inherent live, other see payroll potential CCC next on of customers. calculates rates, [ our believe that insurance the hundreds extension, solution front are this with further for pressing ONE pay to commissions, billions industry. and IX into a with have each paying And is ] customers well addresses to fully We system a employees and office the generational exciting This we dollars this we of customers for complete repair capitalize Payroll. our their expands year to positioned integrated is AI network differentiated factors industry already and repair recently CCC can combining believe navigate most we clients for for strengths the And solution continue of deliver investing the back breadth accordingly facilities. journey. By we help to collision we multisided extending operating incentives high-ROI Cloud and end-to-end capabilities solutions as is opportunity. traditional with repair for repair problems. that our in platform, to solve another This our new launched gross office. operations, By product

our taking client While believe pacing our the the strategic near financial in we revenue our deliver will now call our digital is transformation velocity we to driven over more timing this in by is longer of ability a we to confident contribution than of term. I each to turn detail. results walk remain and initially and long new the Brian, expected, issue the and objectives you through will journey, over products' who

Brian Herb

Thanks, Githesh.

the with and our balance see free and strong growth flow in engagement revenue ongoing our across we which solution generation reflects and our margin the pleased of we cash growth, set broadening discipline. initiatives client Githesh expansion are business, solid margin investment a between As to highlighted, continue

casualty new came logos, said, repair of About Run new suppliers. we parts. mainly continue facilities fastest-growing QX solutions, be repair solutions Diagnostics, point growth portfolio. last of growth I'd and third of our cross-sell, quarter softness from in our in solutions. and and of be adoption one our we revenue million, X up one including adoption our base, our benefit turn we period. X% fourth this was revenue for the was driven and onetime prior QX across the and to year, third quarter quarter [ points to our X%. Approximately of seen in mostly our our our overall as emerging as would contract. Now QX percentage percentage full of from solutions of X% affecting emerging and had XXXX. Adjusting results Estimate-STP from solutions upsell the to $XXX.X upgrades XXXX on the across about points and then year-over-year Total guidance XXXX solutions In have X growth of in volume the shop benefit, of revenue like rate a in for year ] quarter quarter and third XXXX client Approximately the provide growth numbers, portion the continued point came XXXX. ongoing was emerging some year these in from That casualty review third subscription parts a the the claim from from adjacent total the in strength

Now turning key metrics. to our

up been CCC and the QX our rounded has Software churn. GDR benefits participating our to by either that compared was between XX% broader gross or retained Note GDR, XXXX, that first quarter. in industry provide GDR the driven accrue believe in or customers value of down, the since and dollar and amount reflects with We XX% prior last is repair retention captures network. is from revenue period. we the shop primarily XX%, the significant our to the from our GDR our quarter In the of base which year XXXX, line client

core is revenue tenet resilient GDR of our predictable a strong model. and Our

Software the as XXX%, from year and existing upsell net captures from in amount damage base. auto well was in QX our QX dollar volume the customers our our movements or compared NDR, of cross-sell physical XXXX. prior as to XXX% client modestly down period In XXXX, NDR retention,

income review I'll the in detail. statement more Now

of to our metrics metrics leverage all in feel gross million. noted, and good are year-over-year. our $XXX was Overall, deliver non-GAAP. the gross scalability gross business long-term XX%, a to our our operating release. Adjusted adjusted reminder, reconciliation a XX%. and against otherwise the unless model in profit profit the flat ability provide As GAAP about of was quarter sequentially margin of profit we margin non-GAAP Adjusted was and which We press

adjusted X% from EBITDA as with QX some expenses This EBITDA of was some QX by terms In and timing Adjusted million, operating the year-over-year benefit $XX costs. mainly XXXX expenses expenses, which million, EBITDA adjusted up $XXX services expense of phasing year-over-year. quarter is for an QX of in X% higher XX%. QX. driven up into IT-related was margin was had the shifted professional adjusted

balance end flow cash $XXX was $XXX leverage year EBITDA. million prior a X.Xx cash X% the in turning equivalents Now the quarter which cash cash million $XX million period. compared million adjusted was Free and was cash in debt. ended $XX QX year-over-year. on flow basis XX-month to At of quarter, the and up to flow. Free trailing the with in the net our million We sheet of and $XXX is

a Our trailing flow to down of as some XX-month larger already EBITDA. in Unlevered have cash balances impact have the did significant as The October. collected our for adjusted of free XX% QX in of clients. from QX free receivables ago. been of was QX modest modestly year million $XX XX% of XX%, or few was We our flow approximately a timing margin XXXX cash

cash While free guidance adjusted continue an to out discuss range on average we can annual in our of low beginning to to basis. I'll EBITDA mid-XX% XXXX. flow it of vary our level the QX quarter-to-quarter, expect in now

revenue expect $XXX.X X% which year-over-year growth the midpoint. million to at between We million $XXX.X represents

We adjusted the $XXX to adjusted XX% million, EBITDA expect at EBITDA a of midpoint. $XXX million margin

of previous XXXX, $XXX is versus For X% total the unchanged which $XXX and year year-over-year million range. growth our full million, is to expect we revenue

range increase XXX new at our basis midpoint adjusted to we For $X year-over-year in adjusted the $XXX about the year XXXX. of margin expansion a are points EBITDA, $XXX for range EBITDA of to The raising midpoint. million, million guidance full XXXX to represents XX% million

think keep things X and of year guidance in about as our XXXX. mind QX you full to So

year, from on above this QX year-end first contracts, in onetime of more year. as gives true-ups and contractual a us our had in benefit difficult commitments subscription for of one revenue is, QX year-over-year which about point comp XXXX point us in items our of this The we growth call February mentioned

in The second a year. earlier, this volume depending clean About components. is, of our approximately and have X% point mix. I down on though are implying claim year-over-year, to one volume as XX% we client Year-to-date some revenue softness September, that about of estimate during can point we vary referred volumes transactional through solution seen has headwind revenue growth,

is about the past consideration of EBITDA and margin with QX expect year The third the of peak year. we our midpoint QX an our guidance margin updated adjusted that about represent XXXX. to for in XX% for the implies performance, XX% Consistent full the

for the starting expect XXXX of we As QX XX%. Also, will one benefited this year. year such, impact insurance next of in QX expect XXXX, we year's million we expansion point onetime lap of we as a margin the point a $X margin be a claim create percentage to which on this full as in reminder, reimbursement, from margin

we revenue highlight our up, of that, ready would in our our deliver we confidence EBITDA and as customers to organic both our growth to continue execute priorities to mid-XXs operator, to questions. target wrap So continued and for now our take X% value I and significant XX% our generate on as margin shareholders. With adjusted we're long-term ability strategic

Operator

our And comes question first ISI. Instructions] [Operator from from Kirk Materne Evercore

S. Kirk Materne

will, Or you're [ of there thinking the ], industry Congrats just can I of what are -- of newer of about quarter. adoption in about if on we if some to your Is to happen to that sort Githesh, level needs thinking you at you wondering talk do you the can macro think to either as of happen? the start bottleneck that needs XXXX. grease unstick anything a things products. sort level you the there just was or terms skids

Githesh Ramamurthy

Sure.

at first pilot, Compute, of So a, years, being last it specific amount solutions product, are First calculate very workflows, and implement rolled of really the those always it when to at of then of almost and waves new, on these we're we've take it metrics, we've foremost, new think example, billion to over of good to essentially takes things: quarter even I very new to roll look make what And solutions look to play, progress. to X% making out all from our tested. new you put energy solutions, customers sure through see that like, does them. And And about which gone back adoption. a for solutions we've is you for been these score, comes ROI X these what through at the when very, we out, I and think start before, $X substantial talked that foremost, like if down XX-plus right? Estimate-STP they adoption. in from last look is X X% customers as look we've to

through go working pilots this and very is focused customers I we are with Yes, consistency through are -- it's So multiple of the so of those, very our working it. just engaged, think in each ahead.

S. Kirk Materne

just this or I of Githesh, you, say, sort to in the on was Brian just follow-up volume going claim softness a year. as a for

of were volume little to go the claim if an meaning to to go away complexity forward, you some opportunity the the just talked contracts renew, down, the to going all things in about have has you of guys depressed, that and as that broader from up as bit is as of there variability going vehicles. at can while is about value historically up to remain Does been talk One that? claims claim back of get customers per the cost talk factor a

Githesh Ramamurthy

Sure.

at a seen of customers, a file will And a we're gone what And CPI months the we cost the change. What of months as of all, has cycles don't there's at in We look over insurance, belief least itself accidents. last substantially customers is of is the the think CPI, change. At we there's of to our is forward CPI, least seeing out number significantly. and than that we've that into take lot or see happening XX certain our vehicle material look up insurance gone could increase or these a as if higher miles from what more that think we another of first don't whether cost driven, there's get so, the have and even price material I you of up and importantly, think a you So you reluctance XX go we're customers talk -- you core go cycle. down. premiums you or is that look quarter that X. if up claims or amount number And at as something about our says, to

we not increases factoring really So many thing frequency. the are we any the have to has every And components material claim is breadth because the it. us for in claim different solutions of important most

the it's of the we're focused so breadth And solutions that we're delivering on. that

Operator

Instructions] Funk next Bank [Operator our And question from America. from of comes Michael

Michael Funk

contemplated for the One [indiscernible] view? in onboarding to your Githesh, you planning you conversion you helping be that solutions? increase one changes of Are your with sell how would impactful not the question. or either or Or any emerging in customers rate to

Githesh Ramamurthy

get aligned We're are we at time a And is is the seeing our with experiencing be are little client-facing across more higher. customers. is as pilots time, doing rolled we've working ROI. the we're closer seeing And number we of I'd but it's are say customers customers, who new with these that that our pilots solutions just to same to terms working of of we're of put solutions volume solutions it the out. all we the tremendous matter -- energy that with significantly organizations early believe What in of -- number a and

feel so customers. good we very pipeline about And the of

way, or It It's a macro specific. customer So is specific. any is form. this not in It customer specific? shape is issue customer

Michael Funk

some from given second the a there's number front around the from factors? other of heard election partners that's of in question, sense in your pause the there of my or and Githesh, and pause election. any tax uncertainty customers Any that some and caution And Okay. is resellers,

Githesh Ramamurthy

issue. a see don't No. macro issues. any We We it's believe don't macro

In seeing fact, prepare levels time in place. are really generation to of they put report the that this profit the that next to publicly also is know of solutions our many customers and of the highest

insurance these be when any -- tight. period you over can As very very, at cycles of look the industry time,

And good, we are are haul, looking have long whatsoever. a any very of where don't this see have under issues can for you cycle in things You cycle and can customers a and the pressure. profitability where lot a is macro then our

Operator

from question Dylan next William comes from our Becker And Blair.

Dylan Becker

Githesh, a a IX that integration kind interoperability value notable that on be Maybe, with it network. customers these amplifier are you the for kind around existing Cloud in touched bit prepared proposition potential like of of pilots. of data remarks the some kind your of quite has running It of and your to that feels these

So guess the the that might about that of dynamic impact versus as kind here. to I and you less little are your bit that a kind well talked how internal be thinking out management and on focus change as of ROI control you've of

Githesh Ramamurthy

Yes.

the customers are So time. we sometimes seeing at solutions same at Cloud, what is with looking IX are multiple

super same efficiency these of putting For customer solutions example, the of a piloting about multiple an there's parts out, that helpful. exactly in different might Intelligent the be pointed solutions -- as you And and in interoperability at multiple time. First when you the -- Look, organization, do Reinspection, is subro and comes the Casualty solutions

solutions, of ROI. But of the varies the every we to at heart at So I would value. it, we aggregate terms individual the for client look say ROI and client in at it the look

good far, been so solutions the we the delivering And about I that terrific. very see at XX-plus being results of that's feel we industry, a value absolutely to years delivered. this are And and this look from

Dylan Becker

walk frequently well, weren't it that relative question if relative of a loss -- of Great. and brings total off then somewhat in think side. maybe those additional kind side? readily versus we're should loss of us to repair impact X? is I makes sense. conversation perspective the from But it other to of as the hardening feels repair impact solutions too, industry from kind with and kind an the to processes kicks get this repairs. of And we shifts as as kind of from itself, well, Okay. seeing towards on the like you trend total on too, how on we maybe addressable think Githesh, nuance workloads It what That the Can that like about through the about environment, of

Githesh Ramamurthy

sure. Yes,

comment on that. me Let

about have So then that XX% is What takes maintain, because the seeing are settle since down peak, loss say, total $XX,XXX, would a we dropped, car or over at the we cost of we this car loss range. saw I $XX,XXX it the of ago, valuations we total to little very, the values X therefore, closely used accuracy as now used values to valuations, in track and quarters very -- so. have loss, total peak at a need seen we're

has what slight that of that is in meant So the number been a this there's totaled. are vehicles increase

[ at look we've shift to that ], like seen that [ a going the to same losses, come which XX-XX repairable between as used there's X in But you if small time, at are vehicles a also XX-XX]. be newer more play, so to into on repair. they variables other stream shift that probably and So or come X the expensive is a total lot and vehicles

want slight a facility repair Look is sitting total long. maybe where become solutions a total a repairables. But decrease important customers -- by and at and that extraordinarily a seen losses because have you we large, in increase vehicle don't is a too So in this First slight like

photo need that You quickly to take using able out pretty be to AI. and

the of becomes making accuracy critical. more even So these decisions

end So to decide way some the loss, of notice front predictive analytics tool at you first like helps of our go. our that which our solutions

really to to of pieces customers opposed through as this dynamic because together causing look -- how at is think it of you these nature. holistically So all

Operator

question Gabriela comes next from And Goldman from Sachs. Borges our

Gabriela Borges

business. adoption of to and Brian in broadly reconcile some I'm on that deceleration seeing emerging the more comments and Githesh, the your we're solutions with trying NRR

there's year-over-year, point best we if from about look the total deceleration about can a growth for So one impact in CCC, a as X-point tell NRR. there's we

So like new little it well. business looks a slowing bit the dynamics are as

provided the about all So talk a in about you given dynamics? maybe slowdown just the think piece? bit, cross-sold you how little business piece seeing new commentary are that a you business already the on of do And

Brian Herb

Brian. Yes, happy take be it's I'll Gabriela, that. to

end is high making and in into long-term point our range factors would highlight thing I that second the and growth around our guide When you're the of year which of are first you into is there's QX. the is So done, full kind what the about is X% X think the range. half playing for at

half. First, second into have bumps [ we're to we for as the account ]

So QX. QX that point we that we in headwind. There's had we in that's another highlighted point a highlighted one

facing So the second into we are half. tougher comps in

talked about weaker. just and subsequent bit. headwind The deals it's volume the us second then bit they I'd point we're of being softness. that those can overall, is and points on deals. -- the of about around of ] timing We strong, And a that quarter, be is volume for move a flow [ about quarter another highlight can And One is a quarter-to-quarter, point drives volume down third as well. X point can be they seeing

on focus long really we So full term year the position. and

about over flow X.X So quarter-to-quarter, some give deal and ], [ that you you sequential QXs. X look about points last QX QX with looking can size you when an we're to compare have growth the growth think of at and just impact. But

what So same. broadly 'XX, around did did 'XX, X and X.X It's the we in what growth. it's or been in points we of

the So broadly just of growth consistent. and kind is sizing QX sequential

Operator

Morgan Josh question from Stanley. our And Baer from next comes

Josh Baer

Brian. for one Githesh, for One

it For building Githesh, early revenue? it testing, for products over of to of customer that's take us some you convert really AI typical your piloting made this other implementation, take like that just will Estimate-STP was a or how time hoping the hoping the pipeline line much generalize through a the adopter to already from an through to could time like

Githesh Ramamurthy

Yes.

particular, in or the hits, you to allowed back-end process hits. difference a So only first in deliberate quarters, Estimate-STP we that X were because for front-end X very we there's slight

until gradually SUVs, vehicle increase types vehicle. process every the we you It you process. was could X of number that X quarters about we of said, and opened type the door So or ago could

say, X the true X%, if it, point and I to would at photo using you customers So to starting look ago, Estimate-STP, range AI call who have for Estimate-STP customers X% some XX%. are high from at who quarters X about, we

a various out locations, test the there's variation get the comfortable broad this that people is performance so make And as there. accuracy, in sure

a see pretty wide we So range.

it quarter, after now top XX I roll to [ full comfortable to out. ramped get it ] X to claims. In was X, that fully a carrier out one quarters production, highlighted would customer their of them and up we case, think roll about to took their percent XX-plus last in it

So it varies. insurance faster customers. Nonstandard standard than customers tend move to

we what that's So see couple varies a by in But the of it -- in so data. solution, but quarters. general,

Josh Baer

last guidance wondering, Brian, from And Okay. had like Great. quarter. just implied we the QX then,

just softness you're all by was like about? the wanted Or days XX other any was that $X.X popped claims changes were up So about clarify, that I ago, to the -- in talking million. days? that QX versus was XX there last the lowered that in

Brian Herb

we were from the we Josh, the mean, time X%. position last full at full kept for year, where the to guide I year

So $XXX to $XXX we similar a range million. million had of

think So year-end through. -- that's moving some there's to that's as consistent. question, there's as to previous about just Yes, play the how been I parts the and highlighted we just going

are difficult You playing harder have that's harder, to the the which true-ups forecast. through. about talked more comp We

weakness around And pipeline the the versus to falling that's just the going next have there's deal volume been We what's this flow, moving quarter-over-quarter. year year. off close into then

days So consistent where are back would all into position to a talked guide. with we But been point year the factoring the when is full we've XX ago. I those put

Operator

And from Samana question Samad our next from Jefferies. comes

Samad Samana

of lower going like expecting thinking levels are volumes are us Maybe XXXX, first, claim Could expecting at know of a months rebound? what we you of like Are of help should I Just understand to are down and we about related embedded, to us Or you help that. kind a color the the from maybe that kind you expecting persist the but Like forward? you think you appreciate on this level? and rebound? sensitivity. I should couple tracking volume you at how think maybe just kind away volumes X% about them have this about it's think

Brian Herb

sure. it's Yes, Samad, Brian.

been that year-to-date. QX around soft. QX again, forecast have bit. for was the claims, X% which softer down was the then to you gets a looking QX we're bouncing they at So way improved a and bit,

our As over time. Githesh and not said, or a trend, on That will the not recovery do are get is the assuming softer, claim our of we that know it is that happen. not not permanent change changing based but also changing we forecast. don't fluctuation, driving what this that claim said, We're we think view we're recover. when because claims not they're will assuming We're going to

QX factoring level. at 'XX in a So baseline And factoring levels levels. some in kind similar we're then is of in

will volume we're and through how it forecast. that's the about claim play thinking how the So

Samad Samana

organization. have forward? And you just of as to think changes the side maybe business we that? the maybe to about Great. through flowing thought made impact of when organization about you then as kind the follow-up, should the And customer-facing a the of service Like how guys customer the we how or that look

Brian Herb

Yes.

So I'll it's and add Githesh let some start color. Brian.

what So clearly, we're and setting up engage clients. the organization the believe to will best way for be we our with successful

our We improve having our both believe with a do so And think sales. give we together, one will our sales client bringing customer-facing organization, services the interaction of it will velocity clients. organizations seamless and more

the with also our have to certainly we're newer built how the for in areas. as having a changes on We brought impact we we thinking pipeline the that's especially setup And in these product people with into and they're year. organizational But an recent about organization, clients. engagement investment with the help next these that solutions have that was which expertise brought sellers,

Githesh Ramamurthy

that's is we Yes. more each our the of organization making solutions these product we're sure and interconnected we're more doing really are talked make what reflects deeply changes. because And Fundamentally, that these and to what about. with that other, we're why that's architecture doing

Operator

Barclays. next our Saket from question And comes Kalia from

Saket Kalia

for A of been the here. impact a it to lot the so from of you. question couple investors hurricanes of I'll I've just keep answered, gotten my on questions maybe have one. Brian,

Now of But those those events of more right home to insurers. lot a also impactful claims course, tend that's have during much to unfortunately, be going to big auto storms.

some So wake us recently, just can bit a sure just as as well is the that -- this about we little make year, question kind any? of impact just you some right, talk of historical sort just this having storms give is to in of sort of asked, what it maybe the these about to forward? perspective if of think that going us to And

Brian Herb

Sure. it, I can take Saket. Yes,

comes of So reminder, think and XX% subscription it or as is really volume as about volume. when transactional business a streams, the is X places, revenue the our into you And XX% based.

client then of regional volume part, are of our most component And relates parts for is our be But So or that's those, physical carriers large the our nationals. there base. a to a that -- one to part the our portion smaller is business damage going versus that casualty transactional. auto solutions. are There's paying your

revenue out. that's So the how breaks

moving As transaction the date sorry, not flat far as hurricanes, of the all-you-can have to the been and all-you-can-eat eat in client matters or material number. the -- we clients I'm volumes some are really our on fees. seen are It really have not mix,

through, depending the will of their components on volume numbers. so And play transactional necessarily play Others, transaction it excess agreement. their if through have doesn't they're or paying

you, of in for seeing the as a not we're and been volumes. although well. matters seen, that date, our to part impact really significant material what I would carriers hurricanes the tell mix So But we've have

Saket Kalia

wanted think you to please, I Sorry, Githesh, add.

Githesh Ramamurthy

affect a locally Also it when still it's Sure. basis, each shift relatively look doesn't does a because in it really But posture. region. people the national historically, you on national overall

Operator

next from Gogolev And from our Alexei question JPMorgan. comes

Unknown Analyst

for percentage for revenue Elyse outlook a the And what slightly of Kanner was This [ Alexei you -- for why is of next SBC is [ ] elaborate you as grew SBC XX%? Gogolev. reiterate revenue question ] percentage could to can on ] My [ on year? a sequentially as

Brian Herb

Brian. is Happy that. do Yes, Yes. to this

we're XX% is run QX. of quarter, seeing TSR. with in And of P&L is And is $XX was XXXX. consistent it the million. So driver was there it about from down which that is a the where it slightly which had where in big through running Most in is modification through that modification was QX, broadly charge the in a

it's about share-based impact our comp X% So percent got of into percentage.

revenue. out detailed in modification QX XX% And that's the in next were is about year, was about the being proxy. When XXXX. modification. think the 'XX, that specifically in There's next a of And about the of of We material. has to model that's you year. it's that's way There think not onetime small XX% in this no additional So tail but ran the the the kind units to XXXX through attached to modification real largely more think driver. that for

Unknown Analyst

decision-making Got around from it. you are and even are outbound full follow-up, the then And you facing what quick seeing inbound prevent adoption? rollout as Very elongated you're key helpful. of that a challenges product subrogation, subrogation

Brian Herb

a in requires I a complexity, existing more all little is easier lot Outbound integrations of Yes. would that more little a integration. inbound already place. the are say because subrogation

seeing on inbound So increased to been significantly focused volumes, said in outbound. as we've complexity. Outbound large processed, does the board. a more the of little QX we're number stages pretty QX, from focused And subrogation early are seen more we we went the inbound across implementation double-digit have from like on -- we more we have of in pipeline a much and And files subrogation for customers. of first a increase

Operator

question And Securities. from comes . our Chris Moore CJS from next

Christopher Moore

reasonable ] model, place how standpoint, able roughly you're moving be forward to, heavily continue still expand It's invest you 'XX? should just roughly guys, modeling that into range I last be Obviously, in wanted about just a to R&D a that? [ the -- quarters. Or been margins. to answered. R&D, XX% from few Most thinking in to these I unusual Is

Brian Herb

it's Brian. Yes. Chris,

an in. of sure last of is we significant the make really that investment couple innovation area R&D could capacity support We've we the So lot put years added a to that pipeline. over

at been that rate. expect invest but and area significant do a We moderate to years. system we continue heavily. grow of built X there's that that's a is invest the capacity an the So to over to previous but into R&D continue amount

this it So of what percent revenue it is as been proxy, I your for year. with think forward and consistent will has going a grow reasonable

good a it's assumption. modeling yes, So

Operator

Shlomo And our Rosenbaum question next comes from from Stifel.

Shlomo Rosenbaum

so. I terms issue Brian, of one the in and I specific, we've after the because client whereas volumes all reasons pressured had the throughout are it base the lot market clients, various why was amongst to amongst investing the or might or that, the the any of more in just the last believe, Githesh share has be hearing I if wondering years was a you gains of the were companies new states. not progressive, could volumes clients as period And been of that if couple rate insurance of as aggressive this attributed one And of I other that be all your have year. wondering in question. getting

Githesh Ramamurthy

that market top are the gained XX carriers, of share. of Sure. them customers. look have customers of them When at seeing you we -- some What all ours is -- most of some are are almost XX top

have market Some lost share.

look So a in we is nothing claim material we're think takes, but frequency some more puts at see, of aggregate, it's you difference. we are seeing don't really on the anything. numbers the But and is more significant. than there When what industry issue consumer terms always more in we behavior what think of

Shlomo Rosenbaum

interesting. And seen another that. then was payroll me wondering extensions of And could had you just you in the when example, some you of I extend conference give talk of can that could seemed -- system potential demo product, an your where to. We talk just you very about the it at that about if Okay. else

Githesh Ramamurthy

I think so.

of billions between market, the in you dollars, when look at billion in the repair the somewhere all, is payroll the of and market of First repair facility billion. $XX $XX tens probably

we But back-office focused other just now. that see very process But we the itself, solutions on represents right to the so the that streamline. to than we payroll. discuss also large several are plan we out, then detailed on office another other we we And as help those don't repair opportunity front office, but pipeline on focused the back that, are enter haven't

Operator

Barrington. from question And Gary comes next our from Prestopino

Gary Prestopino

solutions couple ratio think a point with new cited a trend you which that able of first you've [ as Sheets, have to they're money launched, given cars then how Githesh, ] a save I'll these since efficiencies, and you out at you X:X Brian that your ton of follow-up. price products that newer often a and all I that Do the with just different particularly ensures Well, find these should Build products? questions one than better levels price are you'd driving more here.

Brian Herb

is the it's so basis. we mean, having and Gary, as it dynamic shops into drives proper a Sheets the returns. Yes. These insurers X:X repair Yes, I ratio, for It's ship the in if then significant the talked different. the they an ROI of part. that, car, the and clearly the received we've Clearly, just on a lot selling wrong do be part times lot for on we Build very eliminating the price to efficiency products and Brian. And And the suppliers. slightly part both of shops, store X:X. based so lag we're having wait the to it a for and about

that So there X:X it into the here, certainly has play ROI. the more is about carriers. how a a efficient and historically we've really strong price talked But has been on we

Gary Prestopino

not even are with you you the something -- to since what can more seeing up step carriers you're seeing what? a you're you're or driving there? Well, is that selling efficiencies, Or

Brian Herb

dynamics. mean I general, different products Yes. have in

price rule drives a of solutions, products better opportunity. we of these emerging good I do as a general, the Others our ratio for we a be strong our X:X. have think very could ROI. still newer and value will ratio have that We It thumb gives But think and mean, at in compelling. look us pricing Some X:X. how depends. on X:X the certainly, customers. a it they're They I solutions, very be

Gary Prestopino

it's insurance down clients anything guess the market. Okay. car in proliferates decline economic a Githesh, from [ than that issue -- hearing also your drift back more ADAS causing as claims to claims are park then this of that ] I an also is it getting decline. And But in the sounds like to else. you

Githesh Ramamurthy

No.

I we And think, haven't we customers is seeing there's other distracted that a what behaviors of hear from is driving. by and back changed. are large, what really lot fundamentally

while For suddenly. more of ADAS impacts because impacts, example, the some break some reduces front-end rear-end causing cars it can it's

behavior consumer premiums the we expect of and the standpoint affordability it. things What fear quarters, couple raised, would those hearing I we'll from customers this is next having to So see. an say of of are risk think issue. think. that's in are our the And about normalize consistently we're months an of but we they XX less the into

Operator

showing I to to over closing like no for I Githesh call am further turn back CEO, remarks. would now the Ramamurthy, questions.

Githesh Ramamurthy

of we'll the of trust moving to our to joining want intelligent thank to for forward. With our transformational and customers experience Just CCC's you shareholders event-based and thank that, we're give objectives those that sit like our financial well across all say And insurance of I'd call also and the behalf our P&C the to CCC, just today, on believe our position opportunity you. capitalize beginning in end this very us at members CCC and also for on strategic AI, I we continue where and economy the the for to investments towards we And and to network, us. customers support. on team -- a our a shift about help here. we'll very architecture, multisided us long-term good deliver feel Thank transition. importantly,

Operator

for concludes participating. today's Thank conference you call. This

may now You disconnect.

Githesh Ramamurthy

you. Thank

Operator

Thank you, sir.

CCC Intelligent Solutions (CCCS) 28 Oct 242024 Q3 Earnings call transcript