CLBT - Earnings call transcript Q3 2024

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Operator

Welcome to the Cellebrite Third Quarter 2024 Financial Results Conference Call. [Operator Instructions]

I would now like to turn the call over to your first speaker today, Mr. Andrew Kramer. Mr. yours. is floor the Kramer,

Andrew Kramer

Cellebrite's Thank follow our you, XXXX York Cellebrite's Quarter slides webcast slide Dana everybody, today Executive the Hogan, Chairman. in There's commentary. remarks. and Results Call. Please welcome, a Gerner, CEO; Financial Cellebrite's New that Yossi to and I'm Tom by Cellebrite's our accompanies Third presentation Carmil, Todd, to CFO; prepared joined City the viewer in advance

in be to remarks. slide replay shortly number on with we is event of along will recorded, The our the call We out being this referring call soon call the of are the made website our and a after. transcript the call after will available

release Relations financial slide GAAP website a non-GAAP XXXX of historical quarters and XXXX all the financial of financial as Starting and well in #X, investors.cellebrite.com. presentation our information X basis our on are are quarter will and available comparisons with tables Slide statements, reconciliations, for to press a and the of quarterly each metrics third today's the non-GAAP copy financial the XXXX. first with supplemental and of the as be quarter discussion including only, stated our outlook done third otherwise, XXXX provided historical XXXX on Investor quarter in metrics the Unless at of

cause statements to of by and not cause from to constitute results results could note statements subject forward-looking other or call facts that are made could historical occur. please expressed and/or They implied that addition, materially not statements. this matters factors In uncertainties forecast. also to statements statements All actual during forward-looking and historical differ risks from are those forward-looking that

SEC statements in these of discussed as March the and forward-looking filed on call. forward-looking amended report take events XXXX, circumstances. -- Factors Form XX-F to agenda cover Risk does Slide or elsewhere any undertake the April company's some annual #X on statements to with on under today's update XXXX. not Company we'll the XX, the provides So reflect heading XX, and on future are topics of

said, I'll Yossi Yossi? to over CEO. being turn the that Carmil, with And call Cellebrite's

Yossi Carmil

for you, morning. you this all and thank us joining Thank Andy,

So we expectations exceeded ongoing market-leading our case with thanks performance closure strong increasing of in we CXC execution third fronts. impact quarter platform, a and delivered that platform, innovation on all our to what solid call the to the investment traction

profitability. X, $XXX history Slide As on we company's quarterly growth, the in revenue and illustrated generated ARR million outstanding for in notable surpassed first time produced

of XX remained momentum it finish delivered positive that We have consistently To year. with baseline for third strong ARR our a and are the in proud healthy we performance. profitability Rule anticipate a quarter, recent simply, our Cellebrite's we put of comfortably mix growth to results and exceeding business

cover Now minutes. this few Dana in a will

spanning Cellebrite Beyond profitable actions platform which the accomplishments enterprise over cycle. digital as corresponding past with the value. several and long-term solid drive growth offerings, positioned of investigative results, we quarterly provider all the architected and to took are is end-to-end important software differentiated months, uniquely strategic life

close evidence. digital platform and sharing reviewing, by elevating and enables more for to collecting, productivity AI-driven CXC Our their customers analyzing cases efficiency faster

integrated a brief flagship taken here X have to CXC deliberate give And to around our I steps We platform solutions anchor increasingly want software overview. side.

enabling and and phones, interagency collaboration. management SaaS-based forensic digital mobile our businesses. case evidence cross-agency digital that evidence software review to from cloud the law many is and of Insights So our collect Guardian set applications, evidence sharing other computers and digital for securely enables managing examination offerings is enforcement family process, of and

across mountains and analytics multiple of connections digital evidence by tool and unstructured identified expediting leads, pinpointing surfacing suite includes source within valuable data for investigative intelligence AI-powered businesses. Pathfinder varied Our open structured investigations and

end, we mobilizing winning new capitalize Solutions launched with spending summer To extensive and delivered see is expand unit us to I'm that customer fully opportunities we Federal are logos. share an with and while this our also on to that So Cellebrite operational, to the to in was we U.S. U.S. expand this sector. pleased the now federal excellent relationship the government, earlier our QX Federal

In all for motion cross-sells. have force to continued quota carrying in and geographies our addition, we to upsells go-to-market sales our augment upgrades, major amplify

which is towards into new top expansion As with sustaining investment this solid ramp centers sales XXXX, forward, we Cellebrite buying within installed line customer and required look base. the extend positions for capacity our

by computers, examiners cloud public sector and forensic growth runway Insights across expected from ahead typically to expansion part come digital a customers from and and digital collect to reduce X,XXX investigators customers digital Cellebrite is forensic helping evidence witnesses. other solutions legacy over with and to digital relationship phones, begins is Cellebrite's mobile software new our suites. this for of long our There upgrading

leverages new enable accessing with modern information. and stack as a proven important The examination along twice forensic while as to upgrade an fast value Insights compelling. devices, as data extracting capabilities more more digital this tech resilient both complete for much proposition more that customers in and

traditional In we of by extending believe into the technology technical the lab Insights customers extend our upgrade, the will scope to their deployment, to it is our environment whether addition want field. in or

approach with X Insights and around we opportunity the our capabilities we to important, goal high-value launched earlier our our base leverage for year, in and access adoption of was processes. by When XXXX. local automating to examination the for key vast modular operate advanced majority years XX% Insights over accelerating having or next substantial see this to Just customers as unlock installed

on targets. to quarter XXXX are XX%, and target to achieve we increased track these last our new We

another of progress the strategic -- area of in cloud. Another

product suites. Insights, offerings Guardian to our new investment existing capabilities, increase our to continue cloud-native cloud Pathfinder existing We develop enhance solutions product and across cloudify and

are And I'm positive very to seeing this that return report happy investment. some on we

with manage this give transform solution investigators as they customers the example, past more to evidence grew prosecutors. Guardian than SaaS-based during how more For and digital share XX months, XXX% and

mountains are our data with infrastructure lead AWS, to cloud doors new technology for devices. and unstructured in secure In Amazon cloud. within buried through Pathfinder identified of private to surface access virtual structured announced investment analytics, allowing customers opening in cloud also multiple we Pathfinder the leverage Pathfinder connection the which AI September, Our digital and across quickly

Just sources, and that burden leveraging broader as and suite through notable, and and collaborate automating expand expanded SaaS-based tasks. in some are as investigators, we AI and units, ongoing intelligence boost to analyze help better we time-consuming into building capabilities an investment tools an coordinate digital data range by analysts investigative of capabilities can productivity and of look even further our our

briefly milestones, market value. our underscore to in like also the cover success would capital recent I which shareholder driving

net previously First, completed new mid-September, which in our ordinary we warrant shares. reduced XX.X redemption million program, announced

Second, for from that our have through further load. our stock shares -- increased resulted performance price strong November, multiple in mid-August million XX early public triggering totaling stock events

high a reporting. with milestones to these At trading capital level, move and clear simplified a us forward financial significantly healthy enable liquidity table

Now these Dana developments few more provide in minutes. about color will

consecutive of So to to Slide X quarters. has now, highlight illustrate north each of for XX to turn enabled would XXX% priorities. us NRR success let's which in produce an like our strategic areas our how these X I

it our market. Our Insights units also first them the digital the easier case more customers access priority on of the better leadership forensic to helps for to is and customers. our in smartphones and newest load their address affordable extend makes growth

the mainly Now have trend with our since during is attachment growth. advanced the unlock during unlock Insights Insights. generate installed XX% healthy helped solutions, local win XX a Insights meaningful base seen rates this penetration The of access module within solutions double the QX has range on past customers launched example local prior our how was That the an open low months. 'XX, great access with we us an when can to of for upgrade to no upgrade slide

investigative growth and INI is call to what law season of second intelligence we our units Our the accelerate customers. to priority enforcement the our within

this a added and seeing the and quota our sales are intelligence building early investigative initiatives within year, we sales help Now large units, targeting pipeline we these dedicated already of opportunities. force carrying specialists

the sector, and business extend our health where to corporate data is advanced use providers, service Cellebrite's priority investigation third and solution collection in Our eDiscovery cases. enterprises private

announced Relativity, Relativity start, set highlighted we of our strategic a to quarter. partnership participation is last a ago, by months good with off few Our which

continue maintain to with for both production of solution devices, see and data remote good the inspector momentum and endpoint choice as We cloud enterprises computers service mobile providers applications. workplace

making our that supports the investments Our enhance Earlier them. fourth help priority our solutions detailed we to expand cloud. range the to of customers strategic of harness is infrastructure are call, the the and power I on cloud-based

as part country. [ markets, full Guardian, European by customers force which adopters larger Now we the of while police highlighted deployments early primary has ] a is by certain inroads Guardian original are been the CXC first Western bill our key in in portfolio U.S. international of starting to make our of in

prepared like Cellebrite's to would on that with X. X I my very major producing markets remains conclude pains. are multiple healthy, tailwinds Slide remarks

today's data. and involves First, crime data increasingly more complex

law build Second, enforcement. confidence investigations. And need advance the law to it for public accountability ethics harder the enforcement their makes operational around inefficiencies to third, and and of

to customers given allocate So more enforcement challenges. cannot budgets, both simply solve our from manpower constrained the these

the the investigation closure, This to of a our type As major major for in late digital plan CXC our driver users invest is technology are D.C. case delivers. hold leading result, 'XX to our need behind customers at a that recognizing it, to event of Cellebrite in one increasingly Cellebrite QX, the the Washington, first-ever disruptive in drivers of or

on we Now a ahead, well as XXXX to we look note. positioned close positive very are

in near-term that of forward a EBITDA again low our our look ARR, mix the of baseline strength Given also to for for produce our our XXXX end XX. healthy increasing expansion the confidence of XXXX will target pipeline, consistently Rule to balanced We and our with adjusted between profitability guidance. once a and revenue ability progress or date with deliver we exceed to ARR have while raised

and close company's more good Cellebrite a by The aspirational. the the safer world. is an for public investigative customers delivering at inspirational is to The assortment on is enabling lower around solutions defensively set world. and team just end-to-end create at accelerated digital help safety It promises smarter the to brand of faster, mission our justice agencies making gap both is focused deliver Cellebrite on and

workforce has in performed Cellebrite's so mildly XXXX. far

not has to Israel Israel, appreciate attributed business and quarter, of experienced those ongoing based we in during focus contributions. any third conflict the commitment While our and the is especially their our and team, This result disruption. the in escalated

comments Dana, And now to my over and please. So concludes Dana. that call our accomplishments. turn quarterly the on performance I will

Dana Gerner

It Cellebrite. Yossi. you, was a quarter Thank fantastic for

are plans alongside we where performance are great clear, deliver to delivered excited of XX X. between the this and have be the quarter, our expected of of seasonality. long-term of XX fundamental execution reflects XX. of performance about the to X We It But guys, Rule Rule range X Rule

let's of Now the quarter third start review the Slide X. on

September. ARR year-on-year million grew to XX% Our end $XXX the of at

gross line spending basis customers. As was much period noted which retention XX%, higher of recent came the on the trends, with quarters. our approximately is over slide, from historical in Consistent our growth with XX-month ARR in this

ARR September and mix. XX%. From ARR mix with months for which quarters a at The the the ARR Insights XX% with total suite XX% at revenue Guardian majority Pacific XX, our from contribution complemented Asia Americas offerings. in the our with of the product was is XX XXXX, the perspective, the represented the consistent and line and drove Pathfinder prior ended by of growth year-to-date our Geographically, EMEA

XX%, by thanks demand improved ARR rates and growth grew the customer and segments. Pacific the the SLG geography, of XX% Asia in our grew Federal in XX% Americas region. terms to U.S. EMEA In solid in

in in above delivered of the quarter same Turning We primarily revenue XX% by first over the year to was The last company the fueled filter. revenue growth XX% $XXX third a increase quarter million, in $XXX.X history revenue XX. Slide period million. our total subscription

from benefited of the cloud quarters. generated in with than revenue some and is deployment. approximately was of revenue, recent the that performance services total on-premise expected line an mix Subscription quarterly professional top represented line which and XX% Our earlier revenue

expenses, gross assets margins and for Now to of non-GAAP XX intangible of acquisition-related operating Slide non-GAAP which and amortization exclude let's review expenses. share-based compensation, a our move

gross higher end QX of at full Our of year XX.X% target. our margins was the

X% were a research marketing sales $XX.X and onetime R&D. development XX% In project reflects We terms the of year-over-year our and increase higher second expenses with costs increase a our quarter X,XXX increase. This personnel between the same QX operating ended a operating higher X million, organizations and year September and from costs from XX% and within primarily employees, ago. expenses, quarter

versus million $XX.X EBITDA Slide delivered margin and XX XX% position. on covers basis our a of profitability in last We or QX. QX cash XX% adjusted year's

profit excellent and success maintaining managing performance our margins our reflects structure. on effectively gross strong profit Our cost driving growth, positively in revenue

net $XX.X ended quarter $XX.X increase $XXX.X year. $XX.X last of from the investments, quarter from million income a with operating of on cash, or cash income same an non-GAAP the was increase increase million non-GAAP $XXX.X $X.XX September for the and equivalents quarter primarily We diluted the reflects second and million, QX in The from with Our cash basis. million an fully strong operations. of million sequential flow

performance. intangible flow cash third and we Free last the cash operating primarily year net from for up which $XX.X provided to was purchase the the by million, due quarter assets as expenditure activities of less quarter, operating define fundamental capital the XX% strong same

occurred Slide successfully and approximately our third during XX.X to like million to million XX.X new move ordinary cover net and events with redemption private September now warrants XX, we XX being public capital into the converted briefly that warrant exercised On quarter. shares. completed the to I'd markets

from In of stock one, a price resulted and the $XX.X of a price total middle total of combined, X the and and addition, in shares. sponsor keep separate through Cellebrite's million price to a invest million they XX shares adjustment $XX issue September X performance restricted July commitment one triggers,

million trigger, issuing Our XX.X QX XXXX, that of price in shares. September X% due adjustment from the primarily X increased and levels another results to share disclosed days the outstanding these ago, recent as in diluted average price Two of we magnitude our events. QX weighted stock performance price timing which XX,

Overall, supports capital long-standing and trading simplifying these structure, our healthy liquidity financial of milestones goals our optimizing sustaining reporting. our

our and our XX% adjustment outstanding since sponsor retired of terms our of of shares, client reporting, of warrants, of restricted value financial all In remaining we fully the triggered the restricted shares shares the sheet them. rather and are as remaining adjustment balance longer represented September on to revalue a between XX now no holders, obligated shares shares, sponsor and liability, we price the our equity than of and XXX%

our Let's Slide year move XXXX raised near-term fourth of on year and fiscal for again first and financial XX assessment of for the results opportunities, our the our our for the full we updated to have Based year. quarters outlook quarter X the expectations.

$XXX QX, between In terms QX be XXXX million. $XXX of $XXX million our annual increased strong revenue, with to revenue and million a $XXX between revenue we million range implies which and

to fourth million $XX in to target $XX million that range basis. increased $XX quarter $XX XX% million cost margin on between We to implies margin XX% assumes $XX between XX% adjusted a on This million margins range the our be XXXX to also EBITDA fourth gross This the or and a operating quarter range XX% to mid-XX% quarter adjusted million million. $XXX in and basis. or fourth EBITDA of

$XXX And ARR finally, we low increased XXXX of the to our range target million. end

to of approximately diluted million QX shares average share to and In terms year share count share count from of a diluted fourth around the be modeling quarter our and all weighted full count events factoring million. markets weighted discussed diluted and be XXX we in expect our capital QX, average previously XXX

begin expect in Slide with is diluted XXXX outstanding, shares the presentation. to to table detailed which this on million XXX We on appendix the XX approximately

our quarter financial strategic results meaningful tactical highlighted was Overall, robust execution. third by and and

even that As gross benefited of a meaningfully product consecutive profitability organizations. our year, of increased well are to excess a for spending Rule XX a thanks we as house to XXXX disciplined invested performance margins and deliver result, the in and second positioned go-to-market in stronger-than-planned we

of profitability success finding ARR us around such our to fueling as quota-carrying ahead, cloud, exceed enable deliver XX accelerating of sales look our target and Rule our initiatives deliver we to baseline success, solid customer force critical expanding well where remain teams. the will efforts believe and we long-term positioned enhancing expansion innovation and we that As to or incrementally our marketing

ask I'll XX, Slide the back commentary. Yossi. I my now go concludes to can turn so to That call you to that

Shaul Eyal

my And journey has were of the begun an successes as for CEO, When just you, footprint XXXX. dozens and year that and us been over have worldwide offices of Thank customers this of Cellebrite as will leader as I market as CEO XX X,XXX XXX last small I end in Dana. out XX amazing X,XXX with includes houses. with many and having of XX at me CEO, the technology employees a finish years, a global tenor established way. working The there countries. a along

drive We now earn value to are a major trust that is the and X past of strides Cellebrite now publicly shareholders company over years -- traded creation. is taking meaningful the

talented customers, our but level success not the past been the to contribution aside support new baton over leader It and led next X I of commitment Cellebrite who and me have has now is it our the would to take investors step the possible time who the of CEO, but Cellebrite very level. will Cellebrite employees. take for been have believe the rewarding without decades, of to the -- the and partners pass a and right will to

team, focus aimed down I stakeholders. all strategic and plan on note a high-tech and will its to to roles an key with technological position business on work reflected for and necessary the momentum before can map At next our the creation exciting Cellebrite company outlook some driving close enable will types updated me of value different beyond. we year road to a But as point that the moved and that happen, sustain at complete forward XXXX strong the industry. is leadership road, compelling all my experience successful to plan knowledge out to in contribute that

a as a name areas Chairman Executive for search critical to marketing and like been has on strategic I he major to Tom to and we sales, success. communications, strong be partnership he imprinted has his investor developed few. for have will Cellebrite In thank successor joined to short time, the Hogan to XX impact since in planning, personally months made I'd He is such an continue progress, and very a my many ago. as our support

I a with great leadership lead know and new efficient Tom as CEO. company and for thoughtful very will CEO search provide our a interim help

confident and lie capitalize our to on In that closing, in the company's ahead. direction I'm in Cellebrite's strategic opportunities ability

we I I yet as XX And best in the about for is Cellebrite know supportive am shareholder, to and come. past what the a proud seeing years, remain loyal I to out As achieved Hogan over take and all our before I close like to would questions, with And accomplished remarks. that Cellebrite coming we please. forward prepared look years. Tom the Tom, have

Thomas Hogan

I'll brief, sharing Yossi. be to you. heartfelt Thanks, want but my start by I to compliments

many the at As exception excel I've long rare in through the $XXX to way excel of revenue as others seen from even gracefully leader company you navigates I've at million that The know, scale mark. this successfully to that up are succeed time. chasm, but guiding rarely been crossed a and and the it's company million. $XXX there all million $XXX the who from leaders more the for that then the early-stage that few entrepreneurs,

on the tenure, stayed and CEO that's proud shortened a as course, Yossi forever years In of Cellebrite XX as leaves has should increasingly world for short-term a CEO equally legacy of. performance with focused be I over shared,

and our our to I and the employees, So behalf nothing express our continued but all success. Cellebrite and health of gratitude him his wish shareholders full service Board, want for on our of customers,

brings Chair, Yossi's mixed emotions. decision as Exec the Now

break couldn't the hand, a and reconnecting to personally. pleased what all often that I CEO. comes earned He's the collateral time for more priorities figure are be next, On the while out this as with damage one personal him

his side, flip leaves his shoes certainly and to big history some this passion fill. company with the On

place. unique. It's and leader company our my search where a platform a one cash in levels all highly the the making customer at about, a into same a that's in loyalty future, all of high that growth world just free company you sure outstanding ARR market, fragmented cloud-centric, undisputed million safer proverbial not better, Dana efforts truly flow already for with a time talked a have The that's still large, gear. company while is kicked AI-driven and I'm belief company. growing the -- this while underscore find and and As strong high that retention both the delivering

Based of expect to for surface exceptional as candidates. protracted to to or line, an specific this that and nothing to candidates obviously and date quickly we not fully a expect job. of rich list to predict committed new profile, It's but time evaluate this qualified deserves completely a we we short a CEO, Board Cellebrite standard protecting on that compete commit or do impossible process. is

to I in departure and XXXX move at We purpose Yossi's between any extent CEO. arrival as will is and will the leader. there new with the interim pace, the and of step the end a gap world-class of

ask comments now we'll said, the open that to questions. for With the operator floor and

Operator

will Shaul come from with [Operator Instructions] Our first Eyal TD question Cowen.

Shaul Eyal

on the think CyTech few Dana, the know CEO process, follow-up search quarter? Yossi, also Israel the or . in on the Tom, quarter. U.S.? ahead. question, be congrats past any the road little this about my I you acquisition Congrats and congrats in contribution Yossi new decades, on based as the will And

Thomas Hogan

the Let's take one. easy

Dana Gerner

the Yes, I'll easy take one.

said we CyTech, contribution very minimal. we when As the is acquired

was This $X.X total million slightly to the revenue. quarter below

Thomas Hogan

company to CEO your secure on widest the answer Yes. And the desire unique our is the casting asset the this we're first given best in planet. net possible look, represents on we -- the point,

And any U.S. or be so whether to search geography, aperture restricting we are Israel it not the that

-- that's leader. will it be driven finding the best by So

Operator

to Cikos We Needham. now Mike of go

Michael Cikos

I'll it's ] the let years. [ go been with over couple Yossi, And last a of pleasure working comments. you Shale's

candidates Cellebrite but The about guys candidates you just so been that expectations far? CEO have first have of quickly, relating when the the succession get wanted to firm. I how we're talking plan for assessed executive you I to for surfacing better I retained a have question was our new the know here. sense

longer-term with that will Investor plan had know Yossi their Day investors CEO today? calendar And go of the the sometimes up. that this in to 'XX year, where the is March antenna through here, March of to reason I firm any this sit Are to just no? piece, are starts target then you the the announcement think succession that long-term we first Investor firm, in we its or ever received willing reiterate year, departing that its guys that changing be second models Day, from there

Thomas Hogan

take I'll Tom, that. Yes.

no that an this -- worked starting respect in in fuel will Yossi and to eye that So focus guide very last to on a the IP I industry This an establishing on there's is plan with platform strategy, our headroom, from closely growth. first, we end-to-end summer, the with is huge the using an amount perspective an it is do or us and much -- of something still and profitability. believe flow to but the cash -- asset fundamental business we change in company narrative, growth with the for solution that's that continue a balance a framework,

we positioning that still holds. and did Investor framing our Day in inaugural So

started On actually ago. conversation Yossi your just question on few the search, a to with we weeks have the

that and which at to out at deliver just to then firms. and of some now And to I literally a night you X company, to company generate in strong go value continue and the we only not versa role the bullish any that fast are figure this you, safer not you you to to see world are shared smart a sleep bed can making that's slate, work trying night X out think they performance, about in knowing search building vice of cash you CEO a to better, spite about of very or that, scale. creation, growth -- place. who key if potential a go that playing we you're how driving They're loves company so as Tier at reached And Rule we to continue with

So earlier, they get person very maintain planet. the best as also bullish the about to candidate but I said pace, to highest on pool. move standard And are the that going we're with

Yossi Carmil

growth X X for Mike, the after kind to words, I'm the thank also trends strategy to And ingredients market at that recently favor especially the all of with first also for and and say management, years, reviewing everything the -- Cellebrite's strategic you which done factors. market and the in market terms conditions. glad coming we reflecting the all, plays that just in that adding of point, and have budgets

our path. that, So to said plays also the Tom I'm concurring on growth to the contrary top anything favor. about no in market on what And of change the reason obviously

Michael Cikos

appreciate the answer thorough Tom, I there, Yossi. and Great.

Operator

come question next will with Rhee Craig Jeffrey Van from Our Hallum.

Jeff Van Rhee

on just and an Great. run great outlook. congrats, the you. for playing performance Yossi, of any the for target vision and obviously out on my of The to look be specific seems what just quarter might insights, be and Add platform to what A questions CXC couple exceptional of expectations on a working the updates adoption exceptional terms XXXX, early has kind an been conversions? with in me

and just driving X of Any And the remarks and unlocks of pace great. prepared upgrading seeing uplift. usage? But then trends color significant unlocks, the secondarily, just would or in be curious the ARPU example in terms of the people an unlocks magnitude you in the you're there gave

Yossi Carmil

say very that then stage it's Insights is deployed sector still very early the and/or X,XXX when and or still enforcement the And the very makers percentage will about well better platform start at. we with are news, the have good it small. days, public The to maybe adoption. I to resonates in comes way decision looking a law and one who would thinks and So Guardian the I customers basically of and the case closure quite -- when early Pathfinder news are customers, the CXC meaning

X Pathfinder by so of is and so Insights far is XXX So news, out the the if part way, Guardian. customers, and it, even X tremendous has which growth good potential adopted the we flagship products, of think about and

in reiterated either terms can a over and we what in solutions, be like sync CXC the sync should of we accelerate growth of a the doing is the broader Basically, very Tom cloud I that. adoption. and handing Dana? believe very to based adoption in and here So Dana, that you add optimistic the before I investment on And about of that enablement to there we all the successful you progress to would that anticipate cloud, potential or adoption significant obviously, and that AI, cloud. further should are the

Dana Gerner

Yes.

we I very beginning this early journey that the a from is said think X of years.

we you healthy I a while of to for around additional coming X, XX%, we customer around base have about XX% is the the continue penetrate the in the our and in expecting with said that years packages existing us. analogs. XX% X future would that potential year to rest the unlock what the mention ahead upselling So we growth are have still base. very script finish said that We a the of adopted, first customer means the of to

So the that but it's it's add-on the the future. Insights great based potential not only also a for packaging, generates

Yossi Carmil

of solution that separated of in a abilities is and twice the here add-on the the One fact were the insights several and more in investigators brought completes satisfied revolutionary extremely models. with which perception the market. more broken Again, faster, we in are the we comments the customers unit bring the down and forensic for devices basically examiners for reaction digital examination and the that terms about Insights access

meet a rates. appreciating is for there positive our the acceptance, So feedback, say 'XX in belief higher value receptiveness high definitely I to strong higher and conversion and that can and confidence ability based that price, on also 'XX the

Jeff Van Rhee

the just it? to Got so where in Pathfinder, Pathfinder, this fall of what adoption few about it. Pathfinder, from the can of question then. deployment, do me of distribution to then we curious maybe to to -- with respect are speak, to Pathfinder AWS And of adoption to a those what's the you that Very last for for helpful. kind choosing expect current obviously, adoption? it kind agencies And talk of what large minutes far? also On model, and use buy spending within just that so -- Is and learn one make

Yossi Carmil

forensics public So the maybe it the you the just X start, over hand together. are IU, what aiming call Dana the investigative we within I DFU, we and targeted a will subsegments sector, unit. and to major the reminder, also will intelligence digital Basically, unit unit and do and

by which empowered that our structured I golden basically customers AI very as many, sources the and and amount either analytical other many data, huge to capabilities evidence of, sources, sources. the And quickly would a source can powered, suite help also of ingested over unstructured there, open say, being is or intelligence basically Pathfinder out surface of for tools

I'm that, right promise on-prem, And growth. now all pace VPC part, Cellebrite exactly capabilities the we solid and planned very terms should building year-over-year. So what -- growing the everything while we pace AI-driven expand existing basically, with AWS, is Insights announcing collective the to year, it that will of is grow while that that SaaS-based we cloudifying to report originally are with Pathfinder a times, XX% that planned the continue we is XX% XX% said every grow the expect and to with or glad do tools the we to several in to it Pathfinder in investigative something XX% that also Pathfinder. in And a analytics maintaining say, implementation on as call of, we to the Dana? area that

Dana Gerner

is And capabilities. brings trend actually Yes. currently us the believe CXC or note base with that platform And large of to The Pathfinder to case the your closure cloud on the Pathfinder actually X,XXX VPC into discussed indeed goods on the would in we a click we a larger the democratizing lot strategic the be because serves it's whether also the maybe available solutions. future with to on-prem double customer and journey fast broadened allow before, our the customers. bring question. our platform, to one as customer department currently base, Yes,

So great years. the in offering coming again, future to we this see

Yossi Carmil

at Pathfinder cannot least, the not produced a day, no with the Guardian, analyzed. here one separate of CXC and and in not from solution, then analyzed, session. separate end creates you've cloud which an got the but But context examiners Last should educational the the is the time with for basically SaaS-based best ingested Insights and is what connection between a and which

doubling company in in analytics CXC to works. that glad the as perception, takes CXC works promise we the adopting. is Guardian it actually of It on are in and and I'm combination seen since that Insights, delivers Guardian component of that to Pathfinder that and year, report terms of it the that ARR the means achievements and -- beginning the a customers means have the an to the a customers traction amazing the and the investigative Guardian, basically concept the the So related size also bridge critical

Operator

Essex Our come Brian from next will question with JPMorgan.

Brian Essex

Yossi, Federal of get your congratulations. question to of particularly the It's business -- understanding are to an Maybe it respect percentage does evolution sector, with what what federal around love amazing federal And Cellebrite, federal accomplishment for? specifically how made with the managing first Would is the impacts federal account have the Cellebrite you of your you've Solutions, that percentage relationships? within so how as is within existing off you. hats I sector. to public

Yossi Carmil

I'll take start. a for it

First public just Cellebrite the And years Cellebrite of space the strong the unit a business us now. remain last to federal and entire was the expand, enabled sector space remind all, declared in obviously, of activity it. to End that's or of basically have position for total the as -- company, of by logic activity, us meaning is solution very meaningful. the should quarter our we all, and that world of forming we federal federal XXXX, around have XX% part

so will it main that of able logic I we we solutions to accelerate delivered structure The former be in and range in not TAM help be broader opportunity exposed growing would I opportunities as and in federal growth the exposed far. basically deployed, a context the operation of a for and That the say, sales will expanding segment in to programs the of us, be basically that mode to the that space. strong us is said, very

report that running to CFS much we ready. pretty that. now And is positive I'm bad about are and very the

we, impact As would impact that 'XX it I impact very CFS, would 'XX, and will to comes say will future, company the in the for 'XX. for meaningful anticipate I the you see of a the financial benefits when see say, but initial an still the

Brian Essex

And is helpful. transition, mentioned, focused that [indiscernible] That's I Is it. you of Got -- have there maybe bringing noted on leader that criteria for Tom, the I firms think terms is go your and What customer shopping the expertise, question. as list of one in most you of But list focus. suitable sales CEO look expertise, possible. you point the search location a to best you're on set think or possible? candidate technological the for wish

Thomas Hogan

when strength -- I as us company what That's yes, the we like about didn't know that's deserves. the Well, And we granted want -- right? with but to shared question, just this they at, people CEO maybe raised I'm a sounds lot laser-focused go-to-market it's we the spec, fair hey, multiple product really is as cases, where a question, of in the given the today a the company to executive is a team, the apply which is, of you that. can It's this basically right. search so. I -- We said, the good, given you question or company vectors god talked bigger this, CEO dodging and get don't a of need

would sector The geography example. an experience Public be question.

shooting again, over-index And specifics, high. so didn't on we to we're want buy design,

to years. just "Wow, a in to billion-plus aggressive and takes that's is our will the the says, So weight what this guide be the and the CEO above we or to over we of and punch X next agenda new that mark and $X ARR kind breath marketplace an the away priority help goal announce strategic -- our expect X

a pretty wanted dodge that and list. prioritize question, open and first aperture to shot but So your I'm to them wide we'll from we trying then with not a tune give

Brian Essex

Okay. helpful context. That's very

Operator

Ho Our next Blair. from William Jonathan with come will question

Jonathan Ho

versus get Congratulations, of upsell given want maybe little been we durability to with or bit can of of give sustainability look net how detail much at Yossi. additional of sort sense retention, to this driven well. strong us it's by you a you is great the the of net work just maybe a It's as been, retention? When how new seat expansion just

Dana Gerner

Yes.

I of think expansion is the part offering but not contribution sending the of growth the volume. offering, net the seats, upgrading and to majority but growth, Insights the necessarily ARR more current more I the also as mentioned by -- vast as to retention ARR the by both the within

the last the So think from the just in on this about giving same is the are sitting if doubling almost Insights-based more capabilities. that and an actually year, you drawing solution, them to analogs it seats

small is the a and of coming continuous fast It some the base is the great growing more this combination it XX implementation And a X. months, ARR performance of of then is past than really the the in Guardian. from the And of very double partner. from

to trying they what to and generation we were great the platform, a way new the CXC enjoy our adoption. we benefits need they is seeing of need customers those move in to as to to solutions, that next So of convey are the

Jonathan Ho

around how within of just Excellent. And customers on little could of how can opportunity this detail you terms then your in AI, AI give your bit a And can commentary additional as well? expand your us solutions? leverage maybe

Yossi Carmil

place a to Cellebrite's so suite of several So machine decade the capabilities power in and the the the IU, Insights very we I'm times, context first learning, solutions in and for brought in market they capabilities to AI far, again, all, of now. a living need customers. customers and about that talking AI and by we review especially high in said collector one it on and examiners understand investigators the of value

elements it's Insights, in much AI CXC flagship Pathfinder we I to that let's of is forget in I also remember the the we that driven or and in add in But basically future. and opportunity like about forward and then increase as need capabilities. to would well. look and report the at step -- then part pretty would obviously, AI effectiveness. our And speed Customers capabilities that the, function we leveraging achieve Guardian investigative significant the the also with see able advanced to the platform, question in going not AI that and say, efficiency as we of elements

well. meaningful the the as we And crypto. and to be I analysis, intend customers very also the analysis to and cryptocurrency of capabilities can with about when can at usage we customers, also today say text analysis, concrete, support investigations high look in look are when And offer, support capabilities we AI-driven future companies is at media a our into our I case around what

of CXC So the drive drive as platform. the I'll of there. stop part meaningful very of the

Operator

come will Deutsche question Zelnick Bank. next Brad from Our with

Unknown Analyst

Congrats success. on Brad. This is for all Bob the on

end. our Just X on

your change kind Cellebrite U.S. how your you a and of historical as for in Federal state level? administration mean just both thoughts with look First, what on any that performance high-level at and could have U.S. and in discussions customers,

Yossi Carmil

said years, it. glad are There our any take the -- I'll business changed. whatsoever I'm and in administration XX on we in business. were for There reiterate this what say to never past. we was impact

impact I'm since glad and to any on that in operation customers, improve mainly which for started point recent administration, the are there the XX say that reflecting at are transformation, we need to time increasing ago, -- coming mode an enforcement trends that the and digital elections years about that, neither XX law or whatsoever we was our any ever of to anything agencies think that. are years increasingly talking I like are of in

as crisis, eras belief would in even proven crossed or has to be about I funding crisis the the financial We well. with ever say, the as which of even COVID wrong anticipation wrong XXXX

that or this the we we time are can will be no very go confident our with be very confident customers about impact also forward budgets. way there you the that -- So and

Unknown Analyst

Super thoughtful and insightful.

geos, where will of kind salespeople, especially sector, Any spoke et on follow-up, of be Pathfinder, side. as you continuing on deploying about kind whether the Guardian, specific it's on add Just to sales insight public private a cetera. headcount, you sector,

Yossi Carmil

Absolutely.

need this I'm say as pipeline, is mentioned to company. we look order problem IU good serve carriers to investigative Again, If need expand think the all, we growth at in are the growth of And people's more -- the a people's glad be to in several we actually we engine, a basically as and customer. of quota have interview. a that we clear First the focus, we while rich in our place rich's the and needs to opportunity our is times, about expanding DSU units problem we proven

Cellebrite success need the specialists side enable more and customers to basically my And investigative in elements that, and see the carriers, from customer the mentioned customer of for upsell which and that classic and our value side and in side-by-side as I tie investment quota will us are while And you customers. good quota unit. by the side And and success. these of operation the period, a will understanding ability to to with leads you to in also news and in opening, cross-sell see fact from it to additional the the customer of investment personas are mode the for

Operator

Our next question will come from with America. Tomer Zilberman of Bank

Tomer Zilberman

much get Yossi, on deserved hope and I your enjoy mark, you congratulations time to the off. XX-year

about your maybe expectations performance So your Street. to of this you to performed looking budget level budgets level, and relation higher was at at as talk quarter, quarter? and about that how I especially government them the wanted the in more when the outperformance well how federal versus you as just state local Maybe the the ended, closing this this budget as can talk for look

Yossi Carmil

in to I that to say in That's you of end Fed an mentioned all, came of to basically want opening. QX First The my what in the makes and the U.S. mentioned federal -- end I year to the terms a very performing on Cellebrite's And in context -- meaningful in quarter and impact of quarter ability side. the the strong our was very it from of the third Fed. deliver Fed the

customers ability transformation digital the the to everything is about anticipation expectations. that growth to That fact and regarding and met reflects basically the related our budget and for finance which CXC including deals, our

So a good was that one.

I said, anticipation respect. any that of change do as And in we see not

I no very no news, that, and that news trend. see good fact finish state also state we we as the there, And local have is down will see the and over on to do the strong a started a we double same the government, we a but and focus government. local always intend emphasize part the advantage. especially that with said, always sell, year huge that I We also meaning to much that on we So the change, news. good by

with conversation deep budgets. to them, a too budgets the a sticky related we about low much the to law our is -- enforcement. and then with our with customers are expected. are a I tied as There strong wise, And and visibility much pretty plan is One, pretty need. and CXC, highs conversations in never and close company predictable have as much There are too never the in about about what we as

these beyond. no in So confidence 'XX look on both change. sides, good anticipate basically as what's happen news and to are And and going we

Operator

come will from Michaels Lake question Street with Capital. next Max Our

Unknown Analyst

one me, Just for Yossi. congratulations, and

XXXX mentioned a high baseline know consistent any profitability should healthy think era think then you Rule are of to what script, you're we forward XX. supports meaningful and adjusted we anticipating When margin I that, in EBITDA? your a in looking your basis? for expansion the from on meaningful stable XXXX Just you're in expansion Or about mean, performing talking I about or on you level, pretty

Dana Gerner

Maybe I'll start.

talked range and XX% -- year are to performing better our do do year we CAGR So that of about not at and I XXXX, the the long-term XX%. at When healthy is that I the way also years have model that, we the our on than XX% earlier yet range provided look provided right coming the towards we business around think very for this performance formal the but growth. that we constant to ARR finishing EBITDA within spoke guidance about looking a

Unknown Analyst

for not, that or pro $X know out federal call services? what if I but with in the tick quarter-over-quarter Was related the to or don't on million help then the it missed increase up And reason that? me I was

Dana Gerner

in event. year APAC it A we a quarter, year, completed specific have we it an was to services. supposed ago, was onetime contracted the customer There special next that earlier be

Operator

now This does Yossi I turn like to closing the or for of to conclude over would additional call. Carmil, Cellebrite's remarks. CEO, floor today's the portion Q&A

Yossi Carmil

and of to the sense But you for use probably in sure this call. trust in all all, wider this long-term a first I uniform I'm so for to future. into for participating trust the like in thank last to So would also time the you opportunity also the to would like I the far, in thank Cellebrite,

to the thank like Cellebrite and would opportunity I the all, employees. Above use

our As to we still us excellent have close good good luck by all wish QX. closing And always, a this for luck year of obviously, successfully an year.

And thank would are the good Thank personal been journey these part to opportunity Good of use to all success. to years, personal and managers part all. luck those a my personal has the Cellebrite like who journey luck note, throughout on and and company of who employees, all my I you. and the and

Operator

conference XXXX Thank you. Third time, This the a Cellebrite Quarter conclude day. call. Please Financial your Results line and does disconnect this at have wonderful

Cellebrite DI (CLBT) 6 Nov 242024 Q3 Earnings call transcript