ZENV - Earnings call transcript Q2 2024

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Operator

Good morning, and thank you for standing by. Welcome to Zenvia's Q2 2024 Earnings Conference Call. Today's speakers are Mr. Cassio Bobsin, Zenvia's Founder and CEO; and Shay Chor, CFO and Investor Relations Officer. Please be advised that today's conference is being recorded, and a replay will be available on the company's IR website, where you can also access today's presentation. [Operator Instructions] Now I would like to welcome one of our speakers for today, Mr. CEO. and Founder Bobsin, Cassio Sir, the is yours. floor

Cassio Bobsin Machado

us everyone, Second Quarter thank and Thank being for Cassio you Zenvia's at CEO. with for all us joining you XXXX Founder Hello, Bobsin, and today. Earnings I'm Call.

been Let our been has for a positive, quarter revenue that to extremely been and rolling on that by clients out me response we Customer significant report have I'm adoption. levels Cloud sharing solution, start healthy as you of this and with churn us, has laser-focused one from our the with Zenvia pleased recurring cross

We our America our that under I'm happy their cutting-edge customers months This these Latin introduced about be that have to is X innovation minutes. XXX X across companies it can also just simple industries so in GenAI Chatbot X in in since in share as value to its a June delivers launch, substantial built chatbot solution. built chatbots.

number that customer of This all the not by will channel simple represents XX% primary least We become a a are according enhancement but to for significant XXXX, keep automation customer to just more confident are and global the and expected increasing. Chatbots shift this service are more of Gartner. evolving businesses experience.

our processes Zenvia, vision automation at intuitive long-term customer business revolutionize Here with is more service and to chatbots. smarter and

they customers' and America, and solutions personalized experience, efficiency more us. Latin enhance fluid transformation offering are in the this We leading that boost profitable and are to

reinforce unlocking The these with attest transformative all for from tremendous growth the clients commitment help features from our We're feedback our market. endless team interactions future leadership our advancements AI. These include with opportunities driving sentiment solutions. learning and real-time the steps, systems. potential past confidence for experience, position In will our dedication of and highlight of enthusiastic the customer in the terms integration analysis, seamless of of the our possibilities the to additional chatbot GenAI of next ahead and solidifying and continuous our multiple in

continuing forward. momentum exceeding to committed move and are as we expectations We this

Now cover to Shay I'll performance quarter. hand it in over the to our

Shay Chor

Good you, Thank everyone. Cassio. morning,

Slide on start X. Let's

Here's the compared second half period in the XXXX of first of to a year. same our snapshot quarter last of performance and

see, to in periods. happy report can we you As are numbers both solid

our quarter second in The EBITDA line our million, the that When first resulted us strict to million came at an reaffirm control revenue XXXX million looking guidance combining to BRL million for growth and our with results of XXX allowing million strong XX again in XX almost BRL the BRL expense BRL XXXX. expectations, months, the totals XX BRL last quarter year in XXX in XXX half. EBITDA full and

XX% was a in XXX increase profit adjusted margin the guidance adjusted Our XXXX middle remained gross stable by revenues our the gross for year-over-year grew in second matched This of XX.X%. reaching XX%, right by range. in million. of period, This growth is BRL the quarter same XX% our at while

period recording of both also year, our and growth. the to same last than double compared significant figures EBITDA Our EBITDA efficiency with periods attesting the operational showed continued strength, more

the XX% CPaaS levels, last market quality dive in cost first mainly first our deeper XX% increase grow growing on grew leveraging and year. business, at and This fourth after now to structure. half quarter second and revenues the in better in quarter 'XX, CPaaS expanding performance the Let's the healthy the attests of quarter profitability to Zenvia's maintaining while the XX% in and both leadership. CPaaS reflecting second results. Both revenue quarter by X in these segments. In the driven kept large digits to ability with understand enterprise SaaS by keeps

large last XX% in business almost year. comparison customers, enterprise same in of 'XX. to especially low compared QX has business a primarily period base second from that quarter SaaS the Consulting the came the in grew The Our expansion

driver and Zenvia the the main we expect the to the quarter be graph our same of right similar of Looking growth new to semester that the the mostly clients Customer slide, ahead, on for the picture, see Cloud. When SMB variations of are we growth with the we figures numbers. very look

take look and now Let's a has on portfolio how a expansion this into profitable mix. better balanced translated

certain opportunities gained business. pursue CPaaS second some to we in volumes continue margins We expanding and with contribution quarter, mix. high to CPaaS in our convert from the the large Particularly enterprises, unusually revenue revenue

XX% of profit, revenues, number The CPaaS, last gross of net just quarter profit. gross reaching and we more a XX% CPaaS year, revenues XX% versus the mix. the into SAS made of and bit that SaaS translated shows quarter had In XX-XX of a while gross participation XX% XX% of XX% profit of second little net in revenues same

on directly converted mix capturing that you revenue. revenue need CPaaS here volumes the in that we higher that I As know, highlight are a our G&A given to that participation do impacts not the focus in CPaaS additional margins. again generate would was EBITDA, to But

exactly explained. X, Here can just you see what on I Slide

CPaaS enterprises 'XX. margin QX growth with and in much and XX% We our some CPaaS was a both margins in quarter mainly As higher this margins. participation, expecting we decrease in driven by SaaS large recorded almost were segments XX%

reporting the BRL the all are as more for XX at margin range, our our XX% to compare remained important with gross going of EBITDA margins than looking totally are to very large CPaaS mix that we guidance For to SaaS are percentage, year-over-year expanded margins expect gross quarters. is the according the similar. consolidated higher-than-expected This repeated that highlighted be drove than within the plan. million, by margins. The or we are performance here that both offset well of drivers related year, we do the numbers half the not decrease And the lower forward. The The our we enterprises of stable segments margin one a more profit margins margin Worth lower adjusted which was margins. when noting doubling.

expansion execution, for next EBITDA on discipline the G&A driver other you our is see as can in The slide.

keeping I my beginning strictly As laser-focused control. the remain costs under on we in mentioned of remarks,

growing the top We than periods. digits both us in double to G&A, additional without adding EBITDA which enabled double have by our more been line

and In result as decrease This since pre-IPO point in XX.X% are factor 'XX expansion but we basis years we are XX.X% converted of cannot we increased cash. into while doing discussed, we lowest XX.X% When our 'XX, from impacting we as EBITDA. G&A the the QX XXX fact, of points, happy to EBITDA with to our sight the a level the just lose percentage our productivity. down revenues this a G&A how EBITDA this basis led revenues. Obviously, semesters, representing our reaching drop, key bringing XXX compare of a drop was of of positively a is very QX in

are business. our case ourselves CapEx Since cash So XXXX. EBITDA how CapEx our is shareholders. also be This more midpoint cash deleveraging half last should here be deducted to metric CapEx maintain our the million, year our and to negative years, index are we for to understand investment projected XX year, from core first flow of our not EBITDA able to through when from we the our for positive than the the In XX BRL our helps XXX necessary to BRL at our sheet we faster at flexibility around have the operational HX reward CapEx XX. be a million million the or year, positioning has a for the expect of for operations generate but only few assessing Until we believe if a well view will EBITDA after accounting will BRL consider in for been fund crucial This positive our we working pace highlights growth, minus as this Also, equity. deleverage, we new minus obtain minus last but balance that future XX EBITDA BRL a expected by EBITDA still we our increase of and flexibility we is that saw EBITDA, generated of debt we flow guidance million the in metric from CapEx. negative. there, a we it of small the efficiency, figure, CapEx. ability financial start

XXXX. we guidance our the XX, reiterating Slide for year are full On

Our of our the end the of first to in XX% XX% tracking is revenue half full guidance. high growth at of year the XX% year

next XXX above 'XX the million range. year In margins, in midpoint EBITDA QX, with of terms half of slightly discussing with quarter, our in the seasonally of second we we our profitable included of balance we and that BRL EBITDA, was XXX flow the half have. the came first the an can gross are million. To first in figures confident Considering result first have between to liability weak including guidance of between growth on the flexibility, The With accelerating deleveraging both the board. sheet. wrap we cash first up, let's about the align steps we our raise greater better important and with in capital been planning, requirements of our debt which BRL of expectations, margin our in reiterating step and to tracks operations XX.X% line our refinance management from conclusion our strategic seasonality, in terms and especially financial our finally, And focus XX%, quarter. financial executing are and on line talk half forecasting XX%

roll Zenvia will Cloud growth. his confident accelerate Customer out remarks, organic our we more that prepared we As even it in mentioned become Cassio that

outside Mexico, ahead. see on we We your already are also preparing to move as expand we focus growth potential. where we with Argentina continued and trust a Once Brazil, have operations where we high again, and appreciate organically

our We questions. to profitable take this, our for value are exciting prepared and to shareholders. With maximizing committed remarks a your Zenvia, and we building future conclude to ready

Operator

Farias, Instructions] comes first Gustavo from from question sell-side [Operator analyst Our UBS.

Gustavo Farias

guys you Can me? hear

Shay Chor

can. We

Gustavo Farias

questions end. everyone. Hi, Two my from

quarters? focus there understanding, expect clients I for I'd forward client to the Zenvia's buyers, if the versus the the like to client-based regarding quarter be our next And The the one you is put has you migration of on to if going enterprise mentioned could this Customer basically should And color have on to some more to it's know -- terms like of in over? I'd regarding work. feedback your from one first expect Cloud. just what know like just cleanup Or to you of SMB? SMB? already confirm we on that. kind second confirm more been will that base large

Cassio Bobsin Machado

Shay All first question, of right. will the the then second part. part the take I'll and take

this migration Zenvia about launching platform Customer new new talking first We So for with started of Cloud. customers customers. to

is demand translating very using very a seeing which and the and interesting So new increase from into our Customer of products generation we the have profile a very, comparing a rolling part we retention new had customers for Zenvia migration coming standalone the of are become these Zenvia of and and portion in And what the usage to these Cloud. cohorts cohorts Cloud. We've already a we deep of of cross-adoption solutions the healthy Customer platform. -- of adoption, been to our out all

is out. this rolled that So being a is project

that expect paying we these solutions access have and our migrate days the this are features. these this from migration access we mean, to customers to business And pay as in of customers still good migrating be but monetized that that able to same as being they of the year. have very volume-based We QX the usage up usually We're same is amount that. as to customers more, seeing benefit former little new they have also we're the beginning. I in more they reception in up they But next to platform. these have early rolled more finish terms usage. grow to a That more a they QX time, we and features, from products And year their makes keep model that already the we at the bit to are of same then from with using out.

of new increase we're this So size expansion. also as large customer retention we're solutions, rolling will the customer in you're we seeing and medium customers. And already new and adoption that these what's about seeing expect That's customer small, of both profile for companies. cohorts and out customers, from this migration

as we're But second in value part this our the -- We of you as course, I platform of now our the mean, can enterprise expect happy customers roll new all platform. in cleaning having of both SMBs. glad and are And customers new think this enterprise have, have of base. we to about we have this to they're of huge we both seeing customers, as we retention up SMBs improvement the platform, towards approaching And I in expansion. Shay, out already customer and platform. adoption terms we're this of we question launch, that very, and more launched with new we

Shay Chor

Thanks, Cassio.

understand So Gustavo, to do We of simple. already needed most pretty what was we that done.

relevant to live see So here questions them. read we I don't we're able on expect the web. see going I'll I'll questions then anything some them if take again. forward. Hugo, we have and

So questions. the progress, the particularly congrats resolving earnings Two on in gap.

First capital bit SaaS CPaaS margins quarter-to-quarter. and on on on working considerably margins for the one The both a and other company's very margins.

Over the margins low high SaaS as CPaaS as XX. low XXs high as past X while as as and been as XXs years, have as as has XXs, been and

scales? long-term of think Beyond customer to size, especially margin way the about the best what as is profile it Zenvia,

I want can know I you if a and don't to helicopter more on then go... go Cassio, view,

Cassio Bobsin Machado

which the and that starting to years of expect to and different a in SaaS higher been mostly customer negotiations, margins We've and on growth happen margins of we CPaaS, low-margin bit leverage as pace higher of the on SaaS it's over this the high-volume investments in on sure. time now is our of the Yes, couple these of of revenue will solutions, last over integration mix. in mix. And customers. than X seasonality on expect the next customer profiles bring we in There's CPaaS, the as variation variation depending are quarters a especially terms lot this investing a mainly it volume-based, depending naturally

of boost CPaaS and creates on Sometimes margins. margins, we this customers some fluctuation lower with have high-volume

companies R&D it's about SaaS, mostly our the mix the we we revenue that programs with cost of profile own has acquire in structure. portfolio different as Each and at combine Looking solutions. its of

see one of that carries we in growing terms is a different is Sometimes, and solution variation margins. faster at what pace

to have of we the as we of company. long-term But some We at revenues. term, margin the be probably we our majority become with have CPaaS going of our long-term in volumes will, as our expected our the beyond some SaaS term the the range, the gave vary expect a course, always of is of will XX% -- profile in margin that be at as business this, long that portion IPO on point, been the combined long

Shay Chor

the Yes. monthly it becomes to as on subscription. businesses to thing as Thanks, Cloud would well. is so the move I new model, add more Cassio. right, on to Zenvia The only the soften, It we similar here SaaS, and a Customer tends and the more all side it's on especially pure channel

So that's the only add thing I would here.

of to part what negative working second capital. the On the way here question on best is the about leverage, the think

It the there's be this, nature, a amount this time or late does of to acquired understand working gap We've to that's capital. to usually receive out? So lot assume we continue since significant the to 'XX. if from related is been keep place from have before pushed there telcos our good agreements be a that any By We or which is I 'XX. would our of company business that this our most middle question. costs, at in have have extending out liquidity negative capital working SMS the a from clients the same that telcos. does on since focusing we managing useful not

this working nature So on negative there's capital no business. by

or of interesting 'XX, from doing time Obviously, to that every anticipate deals for have DSO effort see payments clients the can or we've we'll that that we the our do we keep and negotiating we telcos to as mid both do to cost. the prepaid postpone for been since room always will at improve to that

matter short-term debt. versus issuing analyzing a of cost it's opportunities So of

with understand the our no them. There's on on we specific that agreement symbiotic. So with is as relationship simple that. telcos, we but telcos They the depend very as us, depend

a So it's healthy from relationship been this perspective.

so no are invoiced have losses What Another The reason FX it this driver question it the that FX here. cash in quarter. for of we outside has increase? Brazil. some was abroad, that is impact, significantly make them clear. this clients main Basically, up to for we just the

are it's is the outside again, we But differences. paid, local them BRL, there BRL currency, receiving just register then related balance invoice is since a end Brazil, them We and So incurred the the cost be our day invoice this what to between invoice that the and in and BRL. of sheet in could the operations somewhat in cost the in that the we day we happens accounting in timing Brazil. up and we matter not on FX. It's

the capital the additional Another one Two term? next Zenvia Zenvia questions. the if the the with here. year? integration talk about the work funding left you gap is progressing near is of what for go I'll gap? on the the want set Congratulations need of How companies in know integration and on don't great then is numbers. How Does companies here? Cassio, of funding I and to

Cassio Bobsin Machado

of we the that integration But integrations. have all on these this sure. Zenvia, basically We're project Yes, finishes is project. disclosed called, very we that that companies, One and which these project we advanced

Some of these now process. to acquired these are home we Cloud. standalone of part what finished these finished. game were integrations That's the of these integration is And products, mean end become these Zenvia are from as Customer making former companies products already originated that products,

these to expect be finished. We

to already now are be finished be next in And G&A are will finished of quarter in terms phase integrations. that Hence, we being benefits year. we'll and But of seen say end of have quarter components this to already reduction. in translated proud within majority The year. on the some very we still the of efficiency some second first we

of structure course, benefits be the our company. more And and we that integrations in to cost expect next the of reflected our -- year the of profitability and these up still will, have to into

also that, these providing more a by not benefits, but mainly complete only our So we're customers. solution for better and seeing

So we're being to happy very finished. see that

Shay Chor

here. part Second

gap, of a finance So which management, related you that extension by we on year are into on the the XXX one the rollover is to important balance million especially to the M&A. thing injection for benefits seller's of up February Cassio deleveraging if discretion the payment period we the the know, finance accelerate needed this convert included of this seller's million. One that the of of liability funding is had to announced in earlier of sheet. about the capital that the renegotiation able, in bank with company And equity of loans also at BRL as we the renegotiations, BRL the finally, XX to

profile. that doing increasing is part to of with a So versus -- the financing in to revenues especially job that continue we continue The liability there improves of are of are and our of the our said, terms management is credit if for mix that the our fact there. looking part alternatives lot usage alternatives, alternatives subscription

So us that in the it we in of front puts alternatives past. didn't us have

we've that's been all time. looking the So something

-- terms be in need we And of opportunistic. equity, it's to

Market, So we running. The have ATM, program an At

investor is if is liquidity, for needs any that ATM reason. there there So this the

lot to on day, a to been end to dilution, EBITDA. have but helps cautious we've gap, very important us come business. of the our everything that capacity the will By deleveraging generate So that funding avoid it's tool the funding an of

is This for here. Cassio. question Another

this on as using, of visibility on your next features already for should you a on You front? we expect AI. what Do comments, per lot step have

Cassio Bobsin Machado

Sure.

as but deployed have go already features and we are X GenAI And we Customer With able average utilize the be engage And correlations context help that also in are forth being customer what they this range already they to of create some or they mentioned, features from will live only minutes. not Cloud behavior Zenvia customer can I chatbots Chatbot testation from customers improving to also a analysis, customer better also these an in with solution, avoid We buy within sentiment have customer with history, sales to customers which to we've helping generation. thus from, that analysis give been up on. and more, and agents transaction transaction, minutes, being X with customers, to which already and more, -- tools several and create to insights better transactions customer all support. And improving reps lot interesting being over answers co-piloting, so data customer conversation -- and journeys demands customers churn sales to we and contextualized the can from working customer made and customer for mean, of to service renew, have conversion past deployed. and different customer improvement deployed campaigns means and that, from benefiting of these And engagement so platform. for so on

practical. lots The have we on. is AI So going very of things interesting

why and have now practical are very customers. to value use We cheaper technology available daily on made to kind becoming of we have easy create for that happy being understand and we're cases this basis and can cheaper to a utilize That's customers. so our our for

Shay Chor

Cassio. Thanks,

the -- one. can discipline. going have team Is Congrats the one now Here, should take you the for guess, future level forward? for we on size Is this enough growth? G&A I this expect Caio

Caio Figueiredo Oliveira

Yes. expect support I but the team, we structure growth announced is have all that to ahead. minor the have here planned we What that the is now adjustments,

place and G&A right So now. more growth revenue in in leverage that we will have product all than the gross

Shay Chor

Caio. is a On second half? EBITDA, the here And for QX you, for follow-up level the

Caio Figueiredo Oliveira

seasonality, what everything. QX the has Friday The to due and especially a and we naturally business, in the Christmas Black -- business

of So aiming we're expect reach is if But what guidance. here we EBITDA, course, we the our deliver same higher. we

expectation the leverage our EBITDA. the business So seasonality of is will

Shay Chor

we Thanks, just Caio. any Can has you questions? have if additional poll here. anyone see questions to don't Hugo, further

Operator

remarks. closing question-and-answer session. concludes Instructions] Mr. would This I Bobsin to over like back for turn Cassio [Operator the to our his conference

Cassio Bobsin Machado

call. for joining us Thank you, everyone, this

excited for we're our guidance keep able QX. the year, what in of and over achieved XXXX. we We building projections we're and And our our year and that foundation hoping forecast, course proud for strong to very the are very about the a

see board call. have very with you I'm so us, next and And you all to guys on glad

Operator

to additional has Thank is questions. concluded. today's any presentation. area IR disposal at now attending you for conference your The answer Zenvia's

nice disconnect. now Have You may a day.

Zenvia (ZENV) 6 Sep 242024 Q2 Earnings call transcript