Earnings call transcript Q1 2023

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Operator

Greetings, and welcome to Presto First Quarter 2023 Earnings Conference Call. At this time all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation [Operator Instructions].

As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Mr. of President Vice Whitcomb, Investor Relations. Chris you. Thank

may You begin.

Chris Whitcomb

thanks you. Whitcomb, today. us afternoon, at and and Good everyone, for Presto. here My Relations Vice of joining President Thank I'm Investor name is Chris

of on joined Suri, also issued have website. this earnings Raj Ashish our access be to the CFO, Relations on pleased today's by the first and and everyone Presto's now By is release Company's afternoon, available call Investor Gupta. to which CEO, Founder should section XXXX I'm quarter

Please a will which note call to refer management that on GAAP today's adjusted EBITDA, is measure. financial

believes non-GAAP considered information accordance with is company not the substitute isolation, provides While information the presented in be to a this financial in useful investors, information the for intended this GAAP. or measure of presentation as financial for

press You're for directed of a GAAP. to such our release to measures reconciliation

that additional remarks call to please begin, of forward-looking for release speak statement we this Before during of cautionary Also remarks. only statements Therefore the some note forward-looking. made will today. conference refer that this note call details these please these about press be today's as the on in

cause discussion please filings with a statements forward-looking and refer release risks materially of those to results our the implied to that for SEC Finally, in any differ the today's could from actual or press expressed made today.

Founder of Presto. CEO and Raj? will I Suri, over the turn Raj Now to call

Rajat Suri

the call first Thank you, earnings on Chris, and ever us everyone, thank Presto joining Automation. you, for for

community. We and progress are technology here with delighted to the financial our share momentum business

to opportunity one be suffer of suggest need most, positions market job very across conditions of like and worker get Labor the leaders and large in in our acute, the is benefiting interest automation present. Presto availability and will for a the The solutions just as the labor the in restaurants it the issue cost a macroeconomic They industries This Presto industry. from U.S., long-term strong industry. get remote they in major ahead restaurant trends labor physical done. automation is problem because physically today a only continue to resulting hire can't restaurant worse. the massive labor

enhance won already chains rollout we which data because market Applebee's, in up has easily since help vision, Presto other XXX% ours. like reason a some platform Chili's no revenue Checkers, the is the Steakhouse, Outback These customer capturing the critical led while operational largest computer of and improve in all early platform more, world, XXXX. The touch service the combines speed AI, systems player and technologies. to has deals automation experience, Presto with win major times, productivity nearly capture. can deals other voice labor the no growth and these The that

a our In edge meet needs with addition, easy leading restaurant's it team technology and our of integrate experienced legacy restaurant very make scale systems, and solutions in that the brands. large implementing is to we installing

now I'd explain our like of each products in to detail. one

Checkers, we XX% to takes is by without taken a at the assistant over of AI orders XXX deployed of intervention. When staff believe Presto Voice pioneering we drive-thru the With in voice First, can stores drive-thru, possess orders the of footprint rollout AI restaurant technology that autonomously at automated be up largest Voice our in AI-powered industry. AI restaurants. our

“Would time. to do because every just drink, want you an ice the to never this an we person, find right drink. human simple brands Consider system exactly would what like like awkward it naturally you like say, that?” A Unlike ice cold the AI upsell say, a single But delivers forgets you to would drink line, a cold would the and does with language. consistently it

restaurant expanding to Voice save around can XX operating labor hours day, Presto a margins X XX%. Additionally, by

many as operational key service for to as drive-thru time well data systems. the experience in Vision and gaps instrument legacy points identifies customer can AI more opportunities Presto real the Vision improvements. critical operational proprietary our in Second,

the For too example, upselling right too Vision how and is tandem is Presto enables experience Deployed right long. and at the the many cars in Presto's with are to leaving line because Voice, the a for slow right deliver technology drive-thru is boosts moment Voice the wait guest.

upselling, powerful together the in valuable Together, analytics a personalized Voice service, to they form and experience, deliver speed automation. and that brands. Presto believe to We labor Vision improve productivity, for guest product drive-thru Presto combine market the enhance highly provide restaurant up most

guest Finally, our tablet as legacy such products server and involves handhelds. business touch

also and convenience the playing experience, guests wait to This guest to games better server. but a with a these solutions. their it able servers, ordering tab have food, allow double deal leads labor the therefore for with Restaurants restaurants not tablets for productivity of Our paying and helps shortage. to of front for up frees the time house their been without having labor only

the Presto's with sense agreements XX revenue. we brands, goal engaged currently with, over over sign enterprises brand to well high motion. To a locations. global sales representing go-to-market you master our give pilot how are customers is billion large explain our massive smallest me is the in let top footprints $X with for XXX,XXX of restaurant a potential Now services are,

a rollout to of business which and customers a then are franchisees in and franchisees corporate motion in and arm, pilot, our stores. an will a case with Our addition sales involves both evaluated. Most the proceed and MSA successful to after corporate we pilot technology test, have

top XX conversation be XX to of take months Our A cycle can that. first months. to enterprise X XX rollout cycle from MSA sales on can another to

crest to operating the tends solution, differentiates teams. in best-in-class rollout their of to revenue itself not only are in franchisees also implementation depth breadth our our solution different brands the and stores. and in rolled new out Presto as but and cohorts large successive So

with able restaurant the brands struggle Restaurants customized technology in work who out deliver brands start-up larger work scale solutions XX top who restaurant to never the afford to rolled aren't at need. the a small Top highly companies have with cannot companies solution before. also to

go-public our to on Moving recent transaction.

Avenue, As gross across expansion of proceeds approximately many transaction which McDonald's us which by with our as succeed others. you executives, product well fund capital the and as investors platform recently development move advantage Acquisition completed know, resulted Corp, the robust to many like strategic from former positions $XXX markets Ventoux company public to of to in million is very of macro we well This tailwinds. take run our CCM Cleveland in the and forward

to revenue. talk top high handful live And some pilots installed is brands. or and was million a over rolled of annual than in results, at At are $XXX pilot the was like each fully our potential of from recurring ARR on similar to at the XX not quarter. live we Top of million QX had Presto end first million out a highlights demonstrating I'd in with in XXX these Next bases. include revenue, QX, over end Checkers, This $XX $X.X fiscal line about These QX of locations. does with better Presto, achieving pilots converted and which was statistics represent Checkers.

case, the order offload cost is the each to handled that the staff is traditionally work, system able members. as In labor taking on by was brand saving

acceptance nearly material this incremental fashion, guests generated location. location. to Voice XX% AI the and depending to is for generate presents rates of time upsell an of Presto able between the system Presto's In revenue addition, time. the XX% XXX% on offer each upsell In We've the

are will metrics the expect seeing on majority we of the need these the this that Based products to rollouts and solution, customers' quarters. in we the for convert coming

drive-thru. AI our front, product of we Voice product to to implemented On enhancements have in and stability and the performance solution several the increase the technology our

completed have the integration additional market. us our the capabilities announced AI This last in product. help and further to Voice It provides in our CyborgOps We now was into of differentiate filing. innovation

deployed as QX, launching touch in has team will to we to generation to platform This on QX product our has out called strengthen before QX. partners Flex. our far hard successfully legacy As our test platform in pilots in with continue beta working Presto the been and the work concerned, next is been

Justin Shenoff SVP we both General Foster. QX in Susan hired Finally Counsel, and of also [ph], Sales, a

AI added processing computer we've deep talent natural with addition, in vision. experience key In and language

Ashish the With I'd call for to more the review that, over financials. to of a like turn detailed

Ashish?

Ashish Gupta

new year online for Platform XX, transaction I'd to our prior XXX highlights ARR by Voice prior were again, both run for like year ending start reflects walking the importantly, coming QX. rate, over higher live Once Raj. which you also This XXXX. of GAAP grew today. quarter. at over X% X% increase revenue everyone We an where million and September by $XX from yields, was million, revenue you, Thank in joining locations QX. revenue quarter us through we up Checkers, a from from thank $X.X the saw in

to add the residual impact includes were prior Gross replacement better profit customers in enhancements. to multiple COVID-related line pandemic. during was resources and service required of waves We year and our with of equipment temporary

revenue our result, ending XXX% NRR, metric -- XXX% over a QX. As net or remains retention

We pilots expand time, and with have our touch will product-led as legacy existing margin. both and than in higher is rollouts part system in as expect yield customers. convert AI expect we margins new growth into we a part our they business, over to and footprint additional state wide technologies smaller steady This equipment

growth prior $X.X 'XX year. includes impact million of company, various the product both items. as higher certain QX to OpEx lines our these a the million million new primarily was onetime as footprint segments merger. normal projected a $X.X related status brands, of was expenses expand extraordinary to the loss accounting as in in casual a the and expenses, dining the to operating for mentioned Normalized advance Adjusted EBITDA increase OpEx The QX Raj ancillary $X.X new fiscal quarter for fees in staffing into quarter as compared loss QX and from for industry, we as related merger QSR million last professional and versus investments of our same the of in public well year. new of costs, $X.X related and to earlier, as the were

debt noncash financing interest convertible of notes expense, going-public transaction and that the transaction expenses to other related close, as stock and included expenses Other warrant extinguished part compensation. we and costs and

are to leverage. to legacy where manage intend also we our Touch our continued business, our expect business forward, cost like and that with structure. analyze We're on business mature, more should a focus to operating achieve of we areas the Looking beginning

and innovate while to to Our Presto top growth. continue path move pursue consistent profitability with objective toward that line a also on is growth,

issues coming of one-off COVID and our trailing I filings. as impacts and certain has disclosed as above, had Further, out mentioned from our the pandemic, burn in

As down forward state in bookings of capital and going to service such, expect growth. steady deploy in to new we primarily burn settle

we to fiscal have look to runway We the expect 'XX. adequate as our of end

ending $XX to in 'XX range. June million revenue fiscal be $XX expect the We to million

bookings, that not evidenced cycle this and we forecasts. the or general, for the only mean necessarily logos Please our not guidance provide that our sales bullish note on Roger by is based active less as are pilots industry, sales In earlier. intend to previewed changing, signed upon outlook does we

As us a enterprises. opportunity that And our in excites of our reminder, and mission customers about the are is large them technology sticky. global to is and us, growth critical what front

that, Thank over turn you, I'm going everyone. Raj? Raj comments. to it closing for to With back

Rajat Suri

you, everyone call. Thank for earnings attending first our

be with share a to able know company. all you getting now thrilled public are We to forward as of I'm journey our you. to looking to

see the questions want if you do Operator, to there's please. to audience poll any

Operator

you. Thank

a now questions. We question-and-answer please, be Instructions] conducting poll while for moment session. we [Operator One will

with the your of with question proceed Please is first from Our Samad line question. Samana Jefferies.

Samad Samana

questions of Hey, me. couple good evening. A from

better, First, us where just great million where understand line? think it the how come just as about can the we about in think What's maybe first Just that public you could $XX to a driving million should and 'XX Maybe or help guidance? confidence And guidance? fiscal that how $XX we be the company. see should maybe could there? quarter

Ashish Gupta

fill Yes, I'll in start, appropriate. please Raj, and as

in mentioned, I on and sales we to cautiously, only So project right, forecast. Samad, signed right, the as guide want of logos we've booking, based as now our not

sales and stretched, Part market philosophy is of of is. everything earlier delayed of to also getting macro plus this just out light So our it given, what that's providing shifted due on guidance cycles kind the getting in our year, a little de-SPAC which turbulence potentially environment just bit.

Samad Samana

you how as that sales you growth and about invest. of should you and what just But opportunity lot But what just how cycles, maybe do terms about macro OpEx? follow-up, managing concerns, maybe about you raised -- and OpEx of of to side short ahead. maybe capital, the some You about think about a investments a just obviously mentioned, the gives for you profitability growth, are there's you're which thinking managing managing mentioned, you thinking just how you of and term are think we Great, with in how think then funds toward expectations?

Ashish Gupta

some goal we high potential our these to rollouts. into so Yes, revenue OpEx as tightly, and is see convert of crest manage full pilots

Our OpEx alongside as we as goal of profitability to we revenue scaling is and reach were can, we only kind OpEx the it. way towards look soon at managing is and that, growth

Rajat Suri

in now can areas the Yeah, are right, operating and also we that at earn we in work I the start the growth. more leverage, feed is get mature, to expect areas like -- engaged to turn, of look to the business, business see where of Touch then, mentioned, legacy the to more our business some like we're starting in too right kind right where which

Samad Samana

one last one Great, in. and I'll maybe sneak

getting deal pipeline? you visibility? is to Or compete think is a of it the making public terms company how in from Do Just standpoint? public, company in the it has deals easier that more impacted going

Rajat Suri

deals -- was value to are proposition. another been now our public which velocity, it's been confident acceleration a companies definitely They working see. They themselves. of feel positive deal our us, awareness appreciate public We've many great Yes, has more more They company. a our great it customers, which signing of seen have visibility surprise. with from in greater with

in cycles velocity and we're certainly acceleration sales offering. the seeing due our to So public deal

Samad Samana

Great, you. thank

Operator

Thank you.

from with Please Stephen with next Our Blair. William your the is question of line Sheldon question. proceed

Stephen Sheldon

this congrats Hey, on to taking thanks my for questions, and getting point.

So for one me. just

competing a underway. factors restaurant what those I'm a solutions. have voice about rollout when think a decision vendors? yes be solutions what technology to the to Are of or kind adopt like and Or curious pilots more and solution, itself? of do looking of you weighing concepts piloting thinking Voice not seem convert of on a to with encouraging or concepts of broad-based lot take these AI your they're from these? Sounds it'll whether you other So this no some is type at

Rajat Suri

Stephen. Yes, question, great

if think looking, So look, do not this inside ROI restaurant he if a the that, staff take type it A, do, does what of everyone degree technology its can the relying it? delivering deliver? staff which the on and piloting that do Then looks does orders, that take it they're very accuracy, is goals, is of it they're to the those orders. they with it like for achieves high when Is it we said solution will what

well leverage people Once emerging those group, competitive the the the technology the to are What are to there? this to move for really industry solution? acute do That's I on boxes how year. understanding threat this thing. not is first this can the faster for -- restaurant we we to two get saying, out us, as, just mean, things really is time the fast a as checked, that new franchisees like and group then start the corporate from do as see need how the the as we pull in

I of the pioneers the mean, solution. we're

have -- footprint market in the We are already. the largest largest the we

out. every how get just leverage cadence of the their as the about out need roll restaurant to what out how go to their the we roll process to through to they thinking tailor out to most this can can really brand. that or guy it and it there's culture figure So solution, That's how needs they

Stephen Sheldon

you. thank Great,

Rajat Suri

Stephen. Thanks,

Operator

like no to Thank management [Operator comments. over you. at I this turn the Instructions] back for questions to time. further There are floor closing would the

Rajat Suri

Yes.

going excited forward a to be to all and engaging thank with public. to folks. Thank to Just you. of It's great we're our again share be all. you attending you journey, We're be to really today. looking to with for for excited able want everyone We're progress

Operator

This concludes today's teleconference.

your time. for disconnect at you may this your You Thank lines participation.

Presto Automation (PRST) 15 Nov 222023 Q1 Earnings call transcript