QUMU - Earnings call transcript Q1 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the Qumu First Quarter 2020 Conference Call. [Operator Instructions] Please note that today’s call is being recorded. Thank you. Mr. David Ristow, Chief Financial Officer.

begin. may You

David Ristow

first and Investor XXXX everyone we for our at is for joining a a XX, Good of qumu.com. section copy conference thank of call. quarter which the results our earnings release on closed, ended After first March press XXXX, our afternoon, available announcing you quarter Relations the issued website market our

cause our expected traction make that results statements differ XX, penetration merger designed today financial our results, of forward-looking are actual certain to efforts proposed go-to-market These involve will XXXX. as We to was to customers a risks respect increase and with our could February well number materially. and strategy uncertainties with and statements and announced as on Synacor with that

or forward-looking events detailed result description to Please our may release undertake and more a future call, reflect revise any whether note Form our for of financial only risk forward-looking results information, publicly factors or our we and results. our specifically date the as update of otherwise. affect these statements, of statements a that XX-K that of new this no filings, press SEC to obligation refer opinions as our Please

of and and a proposed results press operations anticipated benefits to release merger, merger, of Our combined the financial factors synergies anticipated combination, offerings also description the may proposed be risk of completion affect includes future that the timing expected the achieved. of

of posted our will our with measure our and in today, is filings call non-GAAP on we each SEC, press our adjusted discuss a EBITDA, During website. the release which

substitute our February when this with connection be measure. with XX, comparable measures with GAAP which not we results. company’s note the Non-GAAP a a isolation this for analyzing on consider reconciliation encourage performance. to session announced Synacor, regarding You will its be or superior disclosures a GAAP find non-GAAP at not measures We in the or to hosting Please intended measure are merger conclusion anticipated you from question-and-answer to financial remarks. of considered measure, of we additional all will that in the including

So CEO turn will over President Qumu. of I with to the and Hanzlik, Vern that, call

Vern Hanzlik

in a change And this work over, agent is and we event current I welcome in continuing. expected, Qumu the With and crisis reset the around will driving and engagement particular many reflect of this that When an them effort and health believe pandemic when pandemic health human the our use would normal, collaboration, overall I business, organization. is even Dave the I a impact and in can as way but become business preferred on on where globe. first, soon. not has communicate. had like I to new devastating you, to To on everyone. hope people’s say, lives acknowledge begin, COVID-XX speak to Thank but I video unprecedented video maintain want how enterprises activity to the has for on will the the and an personal to to normal world mind, everyone livelihoods be only cases, return behalf affecting

business. and more will they when people organizations be of how travel to where, much forward, ask Going for critical

locations recommendations a operational the scale home. we the nature business, our on a all easily adapt As video-first has work our quickly able a company, at in working fully of our globally. and and Qumu mandates every are of team global member to Because with very home own from fortunate been being use from technology, of

ensuring the place. shelter and lead productivity a employees in and our customers also in Of same transition, are course, safe, position we fortunate that support in be are to to

and building tens in out XXXX thousands Global base or hundreds customer of concurrent support even and users. thousands mobilizing many video video cases, to is Our their of infrastructure

under and restrictions work As they home policies. mandatory from travel operate

used Webex, everyday and were content conferencing for now for standard medium like large-scale the technology tools built where are scale. never video on-demand learning or not not intended know, and video video solutions you webcasting are libraries Zoom, is that tools massive conferencing Teams, where enough. meetings Qumu meetings at for to As fills managing apps be live streaming quickly These the this are but were videos gap. small But organizations group

videoconferencing, financial providing currently XXXX health management enterprise-grade customer. but organizations webcasting, extends robust Our dozens as XXX from large-scale platform care benefit of security critical security. and that also and video only level institutions, the of not Fortune content agencies a seamlessly And Global in same government Qumu

Qumu’s has last a our several examples platform, front-end marketplace who the video the of with shifted, on months, has XXXX the believe strong new the revenue of interested, those the current video the quarter. robust These combined become had we And into balance the be for website. the continued of increasing for for and what week multiple year. Enterprise and of the has trends capability last quarter we self-service conference are the evident broadcast. very set was these events in provide Over for first in stage will in the demand the The performance video of

platform as usage usage peak are is not projects challenges levels hours. March, their at the our new fueling the also XXx business Qumu customers during but end up upgrade related COVID-XX from infrastructures. driving normal announced we Cloud only As of of increased

X customers has live aircraft are of information. staff converting actively on example, per now Qumu Five reported cloud currently for large-scale manufacturing A COVID-XX system, videos deployments. million hybrid its that year. pays to is an patients For views current and Qumu keeping large healthcare events conducting XXX on-demand nearly customer webcast a client,

are finally, our And through with streaming. and in video audio both activity we BT, partnership seeing increased live

communications. existing is their XXX,XXX employees external an increasing to Qumu for and hardening and Additionally, as retail as infrastructure customer capacity corporate support video expanding well the video

this significant revenue only portion a second quarter revenue the the second XXXX. small recognize well as of of half contract that able first provide as deal are Although to as the will multimillion-dollar for we quarter, in

date, activity visibility for near-term in in year to Given we driven our fiscal XXXX. guidance QX, our confidence our our COVID-XX revenue our have customer in QX deals pipeline,

In existing with Canadian our the cloud deployments X objective including at our customers to This, footprint combined customer customers new customers, pipeline base bank. and new to puts two during meet closed like Qumu quarter, expanding XX XXXX. large to SaaS logos new in and growth, track addition NTT a its with Qumu on PaySafe,

high converting few hybrid dynamically solution, who their cloud an expanding higher uptick all-time traffic, on dynamic are weeks about free there Now we our ago. along Cloud marketing existing activity, points largest increase has press and customers increase release sales both trial usage Qumu to and finally, number web forms, XX in cloud platform. a with are investigating views or ever of And requests adding in talking in or received about of which hit online the inquiry global an our increased seeing on a we submissions several an been March Qumu platform

With details I will hand the back for overview, further to quarter that call XXXX. financial first Dave over the to provide

David Ristow

for an activity us to change both sales has COVID-XX you, Vern. agent for as bookings related Thank both confidence which increased and XXXX. led unfortunate unprecedented that has and Qumu served gives

to with our been of balance also warrant. improve have working purchase sheet the We ESW’s

some I our financial brief highlights. of on will begin with a commentary

XXX. $X.X and XXXX. of $X.X $X.X license quarter million. decrease of a million for XX.X% for First term the quarter the upfront of year-over-year margin was for resulting million of Gross recognized mix to compared Sales quarter XXXX the of contributed is licenses Revenue quarter with the revenue revenue ASC renewals, to software the accordance first compared revenue first decrease large first in first of XXXX included software revenue timing term as XX.X% from software quarter XXXX XXXX. recognition term was from to in

which a mix As the the margins. higher the generally included has for period of for sales revenue, has period mix mix license margins XXXX a higher in higher mix revenue, which generally of lower XXXX term included appliance

of margin. the quarter, outsourced XXXX impacted quarter included customer-specific negatively the expense certain services professional Additionally, services which gross projects in first for

of and administrative at general Net was loss end XXXX XXXX. the impacted $X.X the will to anticipated recognized quarter compared the COVID-related included of agreement QX quarter, Qumu’s million, our backlog related of was quarter. contracts closing be Net million $XXX,XXX, close is for for unfavorably revenue loss to Due which first to in the for the totaling $X.X second expenses merger to the a $XXX,XXX by which portion quarter significant loss net mid-XXXX. transaction-related is QX Synacor, in expenses with

as for a equivalents adjusted million net Adjusted of compared XXXX transaction-related million the XXXX, quarter May of of a interest. XX, XX, outstanding warrant on maturing XXXX, million note reflected was And quarter ESW for in X, determination for of loss. EBITDA EBITDA XXXX XX% to XXXX, adjusted Customer XX, to EBITDA. entered the no $XX.X December of $XXX,XXX. EBITDA and April $XXX,XXX cancel a March compared X, refer as into $X.XX the cash retention loss its The expenses in totaled Inc. of Qumu was March agreement release to deferred for to first XXXX. and Cash million income press with subsequent bearing first Please our are excluded to of $X.X of $X.X an Holdings, XXXX. XXXX, effective to reconciliation purchase adjusted for of price

note transaction, stock calculation statements reporting purchase of was and upon instrument up which to Inc. was liability transaction, change XXX,XXX $XXX,XXX historical pay and referred the of Holdings to and The the as a certain the cash The which a was dilutive historically for of fair would included to since provision of be the instrument with a of ESW will to Qumu’s a payment the Qumu’s has required common proposed an a subject XXXX, warrant value financial merger including first proposed fundamental ESW closing accelerate in of settlement Synacor, event warrant upon warrant the in merger the obligations consolidated transaction with Qumu Holdings Synacor, share. to per fundamental The transaction. in issuance, minimum in control fundamental Qumu’s quarter includes been its earnings for to a as Qumu’s of the reported periods additional shares

the have And balance are due around cautious unknown to outlook, for we world. will economies Qumu of that and COVID-XX the considers for revenue the XXXX, impact financial business enterprises outlook our as on its

the million on based strength approximately management our revenue to second $XX.X XXXX be expects to Qumu’s and quarter customer and date compared million XXXX quarter $XX XXXX. contracts as to first in pipeline XXXX However, of

COVID-XX. merger for available trends revenue more as year of the XXXX. to becomes consideration second other the is assess continue ordering economic customer Qumu information providing for by anticipated the will Qumu’s In with any or guidance the outlook metric of not disruption regarding profitability management full half Synacor, year caused and on

detail you Vern and anticipated turn encourage further Investor it recent can be of filings, over back will website. to our you, SEC the I on for Vern. transaction, on review For my which section we found closing That our Back some comments. to the to remarks Relations concludes

Vern Hanzlik

the we will Dave. anticipate ever. strong our Thanks, up, sales come business stronger in measures. global through To remains we high crisis Interest multiple and current than wrap by platform Qumu’s current activity, is given the

Our sales pipeline grown has by XX%. more than

backlog, our significant high at revenue retention and We XX%. remains customer have

for and a Going maintain be in on will innovate as further the day. customers financial joining customer business new that realize finally, by our to expand beyond concludes our to laser-focused sales upon video our defined prospects follows: far strong opportunities; us while building extend bringing and That will results, today stay our building BT the assume channel and customers you continue everyone have our believe, video year; improve solving happening related on we will to on the direct – as problems COVID-XX our tough our forward, new and footprint our continue again a markets; focus XX% existing partnerships defined with to and customer enterprise our others; on enterprise; platform dramatic all to net within pandemic; grow in to video fundamentals. on retention our comments. be capitalize above to the to and growth normal great within established for Thank execute and existing monetize base strategy to

Operator

concludes This today’s conference call.

You now disconnect. may

this for event] session Q&A [No

Qumu (QUMU) 10 May 202020 Q1 Earnings call transcript