Crexendo (CXDO) 5 Mar 242023 Q4 Earnings call transcript

Greetings. Welcome to Crexendo's Fourth Quarter and Year-end 2023 Earnings Call. [Operator Instructions] Please note this conference is being recorded.I will now turn the conference over to your host, Jeff Korn, CEO at Crexendo.

You may begin.

Thank you, Paul, and good afternoon, everyone. Quarter XXXX Fourth Call. Crexendo's to and Conference Year-end Welcome of of CEO. I'm Chairman Board Directors Jeff Korn, the and

On the Jon numbers some will call the year-end CSO, our our and President safe with Buch, business brief more excuse me and fourth handing will to Ron over today provide harbor COO; Anand the After and After Jon that, Vincent, a for quarter. comments are detail we'll me.In the then Doug Ron harbor on you would a on statement? our will open the performance questions.Jon, COO please statement. before give update. CFO; provide safe our Brinton, moment, call CRO; and our the up our -- Doug to read to Gaylor, I read call sales that,

XXXX. take you, Exchange XXXX the statements opportunity for provides forward-looking conference historical this The to want remind of are other statements forward-looking All than XXXX a Act in meaning the call made fact I the of Thank that contain of Reform forward-looking within statements. call harbor of statements such Act statements. and Jeff. will safe of Securities Litigation to this listeners Act Securities Private this Securities

obligation factors based materially to, risk today. detail Forward-looking should results to statements.Investors to the December be a estimate, limited information, include, assumptions similar statements the XX-Q publicly discussed cause Commission, over uncertainties update now are from actual any revise as but like and or expect, Securities to not future are expectation are forward-looking forward-looking those Jeff. here that and year for the call Crexendo any risks identifying forward-looking result and or aware turn in the Forms are words as with anticipate, filings of statements statements believe, like and XXXX, on not whether events differ subject These will could in any fiscal of Exchange undertake and Form otherwise.I'd explained does statements including to XX, XX-K back to other that Jeff? filed. company's the ended new

Jon. profitability. again to pleased in Crexendo GAAP very achieved you, report the fourth once quarter, Thank I'm that

While my as stepped fully EBITDA our as roughly into meaningful maintaining operational primary flow already profitability been on strategy management of particularly marks significant the us. our I integrating on role, year is and cash acquisition represents has team concentrate year focus CEO and This deliberately existing acquisitions the X health, to operations the indicators we which a since milestone for of GAAP achievement it efficiencies the period paused a had during last maximizing made. our

well.In alongside been enhancements have successful continue fourth operational to quarter, driving we commitment continual to the our very improvements. maintained robust efforts and growth sales and Our work

exceeding dedication work the system working the loss is This me and transition year everyone fruit brought entered increase efforts XX% the million.These fourth year. every we with work revenues in last total to with for our an dedication our advancing classic day smoothly cutting-edge our effectively. reflects everyone Crexendo room in This same strong results the fourth period by had of more to goals. our in in This to start to we Our of impressive are continues an quarter broader customers year-over-year and platform success is VIP part revenue the beginning $XX.X achievement Crexendo.The year, a noteworthy and story last challenging from XX% annual and reach remarkable by only this hard initial our of strategic not the position with the a particularly given hard first quarter. as team's but turnaround momentum, compared quarter with climbing at cumulating achieving at

expense more old to system the customers. optimistic are relocate shift vacating migration and us cost lease delivering will hosting new it capabilities, for will effectively. dedicated the customers our who eliminating had service commitment roles.This completing to year-end. our been we and premises system. allow efficiencies, also enable only Employees the Furthermore, an enhances operational migrating We workforce with but currently the including and this to with will aligning maintaining our exceptional transition by us value Achieving very associated significant milestone support not and reduces our to about additional

at least this capabilities in the acquisitions, meaningful been at thoroughly, to overall quickly profitability be and journey acquisitions enhancing aimed our pursuing accretive continued standing.The year. securing rather and strategic associated and edge new model cash has fleeting testament profitability, achieve our to it's EBITDA our acquisitions past year is a improving to positive not of creation.As growth due our success over will efficiencies which business and optimistic capacity market. the of commitment we we our challenging Though one for the timing and acquisitions we the our become to strength a to ensuring we strengthen investments approve competitive been costs, pleased grow company's affirming our additional of part of and embark about our announce operational strategic GAAP move and about and and intangible portfolio Crexendo, acquisitions.As again value operational towards enhancing dedicated and might profitability review GAAP mechanisms am on last ongoing confidence maintaining the forward, to our under value our the ability Our a as addition I'm integrating chasing more effort I generate with series

growth, cornerstone is our an doubling and themselves.Recognizing the customers provide upgrade, We our the platform it's the as hassle licensees hosting This in merely business of in our a what not need our to largest preferring fastest-growing our and are X.X. for effectively. seamless more we a over Hosted accelerating, hosted is platform solution managing down shift, offering position third of the The our X.X the hosted and platform, tools transformation. to country. demand on essential we investing run their is are facilitate to Hosted with maintain hosted integration proactively call initiative designed

excellent current future, accommodate that are needs we while to just the effective not the Our preparing growth evolve for we Through it. investment, anticipate. solution shaping and we to are

Our strategic not integrating to aim towards accounting also is upgrade service our and effectively acquisitions remains to modernization, effectively operational continue are been effortlessly.We're of fourth our system technologies ensuring unparalleled it's growth.In a platform updated testament our robust, capable we a to The serving and growth provide This the -- us our future and upgrading our need and scale year-end future encouraging, highly the acquisitions we manage results seamlessly to step will with customers quarter conclusion, system. is anticipating. just while a strengths. agility integrate offering and to move as to scalable, our new have

awards. continues reviews and technology exceptional to receive Our

growth and organic along Our team success. for Phoenix am is very, about only acquisitions. about future year Four looking the team, anticipate coming tremendous we're our here is growth, up next forward ahead Final sustaining system we excited our ahead, to opportunities our communication also I, hometown with our The it also but month.Looking and excited continue that. through to dedicated us. very of the double-digit bright our used at strategic amplifying And in being our not

our and our driving Ron? for and all for that, to committed growth We company, customers our Ron advancements improvement the continual technological and partners, to I'll on value call shareholders.With for numbers. more are turn detail over for of the

to for financial everyone. Jeff. for year. the start Good afternoon, highlights million some $XX.X $XX.X Thank I'll prior the increased to with XXXX. XX% million revenue Total quarter compared you, quarter of fourth for the

quarter million the year. XX% $X.X to Our compared Service revenue to for the $X.X prior increased for million

and quarter Total the common for the common EBITDA highlights $X.XX million. for diluted year to give in a $X.X and quarter for income quarter loss to revenue million year.Operating for prior $X.X prior million for $XX.X the per some $XX basic increased Software for That's of $X.X for was for year. for prior per million. increased to the segment quarter to million quarter breakeven compared million a for prior diluted quarter, related compared primarily a $XX,XXX, the or prior for per year. $XX.X or XX% stock $XX.X for company common million significant to net net XX% in loss the prior the $X.X compared loss compared revenue million is a Adjusted compared million year $XX.X XX% EBITDA goodwill revenue and to of $XX.X the of prior reported to our year. $XX.X compared to basic diluted year.Non-GAAP decrease $X.XX $X.X increased for to year. the $XXX,XXX share million due for $X $XXX,XXX common decreased expenses to Solutions million which the year.I'll to for December ended quarter $X.X And The That's diluted Service the to year XX% share, per the the is sustained to Our share year. $X.XX $X.XX for impairment prior full million the XXXX. million the XX% price.The basic income compared XX, basic share. product compared on increased to asset the decrease long-lived net was revenue and in you million we the and reported $XXX,XXX of to the prior the of

Software XX% expenses increased And prior $XX.X segment prior million to year.Operating revenue $XX.X million the revenue Solutions year Product compared for year. to to year. compared million Our $X.X increased $XX.X XX% decreased $XX for compared in to to to XX% $X.X prior the million the the for million million

year. per per the diluted to income per common in quarters the million full long-lived basic decrease common $X.XX company per and With compared consecutive a the common $X.XX earlier, income, we the of EBITDA year net and discussed loss million to $X prior of share significant $X.XX prior was the -- diluted share. $X.X prior basic and was the $X.X the As loss for or compared net for $X.XX was the -- year. to related asset -- $XX.X basic diluted or for year. prior common share loss That's million share able goodwill impairment $X.XX or to that common share per basic $X.X year.Non-GAAP to loss net million reduce diluted the net X of and to in primarily million recorded for for income common the a per non-GAAP loss year $X.XX and year $XXX,XXX compared share of net is that's

cash million for at the million the was end $XX.X balance cash for compared EBITDA million. year.Our XX $X.X December the to year. That's of at adjusted $X.X prior was Our million the compared $X.X to That's operating prior of of $X.X first flows positive from for activities The year. We of $XXX,XXX operating compared quarter had positive months fourth the cash X the flows $X.X million year. million. had to

of investing Our investing used to provided activities compared the $X.X activities in for cash prior year. million million $X.X

in to the $XX,XXX in proceeds financing our In building.We million we sale the received utilized the prior of building, building During That's the activities the from Doug operations. the million.I of year. $X.X President during we compared sale $X.X corporate call our of on the office year, corporate payable office and our COO, million with our comments on Gaylor, turn note for year. connection cash for $X.X used repaid the additional sales over now and to of will

momentum extremely as record strong we that about numbers reported QX we and very excited I'm XXXX. today Ron. with pleased and our start our year-end Thanks,

QX in revenue XX% our along increase increase well of organically were acquisition. in year-over-year as XX% with on as Our direct annual growing result focus the through revenues year-over-year our

us had a year and per growth of for income million QX allowed year. and costs for combined our to for achieve GAAP and dedication of net schedule had the for finish share QX to managing profitability we earnings. a net with income of We quarter GAAP both $XXX,XXX.On quarter, ahead non-GAAP $X.X with small GAAP million GAAP positive of $XX,XXX loss $X.X the the non-GAAP basis, $X.XX Our the or strong

our and recognizing results our our the for costs opportunity synergies year from in for acquisitions, leverage to and quickly significant the quarter allowing success us to highlight the Our business. managing grow

We've we their XX% licensees, improve XXXX Our cost our saw entire believe see will overall tirelessly we the talent great help growth.Our organic per provider a division growth continue cross of discussions efficiencies that benefit our of end pound.We to Networks, UCaaS also Crexendo. the fish previous of more that UCaaS make fastest-growing of stock from fact candidates the accretive the team on been our from X big find employee X fishing acquisition acquisition and additional an we business and our and stand-alone we and a to our see industry have from proud efficient, completed We've of the business UCaaS forward production & as rate worked for are us we're from solution to XXXX acquisition the American and together basis and as we synergies in of XXX which on that or we to highlighted pond look excited revenue of nearly XXXX, Sullivan provider they in North at for priming industry the continue -- in our Allegiant acquisitions, demand pump next able synergies platform benefited processes country. first software targets, are company outstanding maximize from paused be Jeff from acquisitions licensees to Leadership to for that and mentioned, the more one a in under the had landing transitioning Strategy to a user their awarded Crexendo year We utilization that of a we are in Award local XX% growth the ideal surge recently past nearly accretive XXXX double to an basis.As acquisitions improve and Allegiant to us using average. our the the to tremendous run the our for highlighted continue to additional XXXX. in highly was our Frost

users globe. million across supports the platform Our over X now

businesses our of and our for licensees cloud.As to migration rate agents a side XX% enterprise-level and Crexendo to business benefit drive the the Crexendo, additional helped organic the services they midsized the rapid year. which by from Software continue and growth grow, small businesses Our the licensees Solutions on need from

platforms.We and to set for likes success left to have more Metaswitch and for Cisco's -- licensees X ourselves competitors, model XXXX with of new support software drive and BroadSoft and in continues Crexendo great ahead. had hope to to and us that pricing differentiate Microsoft's platform year unique of adding feature our from solutions and the platform our our licensees see combined Our in in our those robust allows new left have Cisco, Microsoft Avaya the largest

master also logos increase We grew U.S.Our in traction a Telecom XXXX excluding see in X% saw our sales efforts from a outside strong large a our in to Allegiant from bookings for the our and international new our acquisition, we and demand for channel the segment continue offerings saw organically, at and partnerships. strong saw our partners as added we in XXX% agent of Services growth year

added share and because warranty Crexendo of best-in-class phones our have partners to our Our channel growth satisfaction nice our a VIP year.Our uptime and to with service resellers offering sell basis, partners channel and and existing along customer guarantee the the results. over services Crexendo their on lifetime a the program channel prospects saw representing customers of revenue our and new our great from our partners course on confidence XX we the XXX% customer

from to the add an the program year, in agent end and continue to now funnel partners million, We the larger bringing increase XX% about partners end at opportunities and these to the backlog that are of the and XXXX. the the of $XX.X are table.Our agent it's continues new of to at grow, new excited

it's contract months for solutions, on backlog is will of strong future sum stream. of scale sliding the Our revenue a very over remaining and services recognized and number values indicator XX the that the next be customers software a telecom our our

gross the gross in on Service year Solutions segment the of including but Software XX% from Service saw were Services Product affected acquisitions, Telecom We continue be to margins margins nice and segment.Telecom and for from a Telecom XX% continue Allegiant focus to lower our XX% increase by were margins our Allegiant. margins XX%, improving to margins the some

Remote review for the ranked XX% were improve team is honored to the as XXXX. addition, generative usability new allows software and Product also technology prior with or release, a Work as the business, add to software magazine.In Product.Our hosted for Telephony great the very Pioneer intelligence our We for of Allegiant, continues on open new Internet the from AI the margins platform. the reviews. year artificial solution were XX% communication-platform-as-a-service capabilities GX.com, via the engineering allows X.X features integrated also or easily best we and offering We services Award which Excluding Award amazing sector API telecom consistent our and fall to as site, CPaaS technology. Services of be premier our into this XX award-winning by in with well those at Version were Version XX QX to Year the for and released in Telecom

the our for well Three allows the and more have AI revenues and we The solution live couldn't the questions answer to more inorganic our Crexendo. during on million, growth, our by solution over X powered $XX AI by need excited about and future system we ago, had be for using company's million. ChatGPT we as in plan interact short body.So center for start direction I enables first than for QX a years organic without of released AI size contact in that XXXX, $XX.X executing opportunity commonly posed years tripled to and

shareholders. in for CCaaS growth CPaaS customers partners the returns and UCaaS, and with We our most industry a our and the offerings best for with the sector of workforce perfectly our product our disruptive delivering continue solutions, with are in the our and the to pricing positioned along strong to best our best offerings success.We're and combination the and committed to demand great strong model talented

enhancing users, improving the comments. our X that, over supporting strong returning over country, any million results.With I'll our further now on efficiencies are back Jeff focused As solutions, the and it turn in we fastest-growing to for platform solution

further you, Actually, Doug. comments. any have Thank I don't

open to call questions. up don't So the Paul, why we

Instructions] from the question And Northland first [Operator coming Mike Latimore today from Markets. Capital is

Congrats on there. the nice. very great Very, year

so quarter. onboardings what mean, impressive. you on was is Can to a just X more it just demand users, or I big like couple million pretty September broad-based or X.X that million sequential there XX% growth growth? a of relative Or Just on in the strong drove of there? -- the Were give little kind detail

all And it's of Mike. A of above. question, Yes. really a combination great the

So year, providers that platform. platform of our XX added think new we last when new logos are we about

So they come ramp new logos as those very on quickly. to board, tend up

they're putting live, if all So their from of move customers of try their their and in platform, to they our they go customers a old platform over once platform. move new or all quickly

that nice not rate, in licensees growing industry So XXX They're at higher. a the existing is our bump.But obviously total. gives if us plus now

as so grow. we they And grow, continue to

in demand so, And out lot there. There's market for a doing are our of SMB solutions. services our the licensees and still our great

grow continue our allows add us go. And users, so, as licensees to more to trajectory really see and that it

the eclipse. to to getting pretty million course a million X.X here gate we X X And us year, was anticipate million this of million and quick for X.X So to so. in the

Allegiant And that entity for growth really about then opportunity cross-sale year? with how thinking But are Allegiant, group you the strong this on alone.

again. question great a Yes,

selling. of we that a to cross-sales when lot at opportunity sell the So MSP for they're Internet services us services the and look opportunity, the

side the larger of customers, look with average their our on our size house. direct at than it's transaction you size average If much transaction their

we look here. that selling of at that bundle John our when about Brinton, services, Officer is we're So Revenue excited Chief prospect.

on of team. Allegiant a from to to just I'm have migration Crexendo some over so, going cross the comment that team And bit little him the

been & growth. the we real up appreciate quick for mentioned, are to licensees operations us a by of that we award opportunity, super growing with services Doug the cross-sale thing, the that the the the grow them. integrating give benchmarked we market something got. leadership there.As to customers that, it because increase relates back back sense. to up We've Frost success going Sullivan And to Allegiant to wallet of some quick make that of our of double just our as of in and One significant the continuing And we our teams. that's So at -- think opportunity support and on continue rate share that's

to services with the starting So what that in do have GX that the at bring of our that excellent we still our doing same add into customers we side experience to outcome can delivering about can so in bundle customer the we're rankings. a experience and like we so we those now continue get VIP to we house offerings just We're great like we're the make we to we're call excited And talked look there.So it. on sure way purposeful the past. the those it

at more you seasonality, or I any January provide of months perspective? -- the have That's out a January worse? year? did and of bookings from normal how start it quick played just on better you you One see color can fine. how and Kind normal one those is kind of February here. are February guess relative the to how Just

you give in results -- QX. guidance, Josh, comments, -- but I'm we're Mike I'm as with But for very my said guidance, as seeing don't sorry, pleased the I we we don't Mike. give know,

have that well. growth if indicated we much more didn't don't I expect that. I But to than double-digit we wouldn't QX want going So say see

is I right sales would tell now. very momentum you, And Yes. strong that Mike,

continue add We and out it's is our been. opportunities ever funnel as for there, new to partners sales strong reseller as

opportunities to bookings in and momentum. we're there out seeing slowdown So great any not have continue

The from Riley. from B. Josh next question is coming Nichols

a VIP Just work migration to because done and platform, going doing this looks year. like that's Crexendo it of you mentioned lot the you've to to finish be the been

year XX%. were of end acquisition you by to this the company migration? if You that entire that that Service expect complete Do excluding you'd around gross back Allegiant for margins level do get you said the the

once we're from right feel I'll color see where that you about a tell then complete. that XX% migration complete perspective we I'll is on migration bit and now. migration more with margin where Yes. Ron a like to currently, pickup little But the is the gross have we add

So we're of way X almost quarters there. the

towards the migration get Jeff investment. in of are Ron that of end a I'm roughly we of happy more extremely little as it about a might the by And that once bit for, cases, end But they're X lot So be will cost getting go migration full pickup process. because the in so summer.And over, excited the year, we're extremely bit have customers said, more we away same feature The of robust most a a more optimistic that add get that lot we'll little costs supporting platforms. will because color on set that.

on and we percentage have extra that Yes. have in little we point margins to is center. they going going anticipated to pinpoint gross longer be sell Josh, a out to will -- platforms and to of due nature what the no until little services to have But margin hard to it's of to so products continue data bit it's exactly going that. give support guidance Allegiant X the have We're acquisition on weight to pickup sales as lower our an there. of the just a

not or to expect we to may we the XX% range the back improvement as trending go we some we acquisition, were get that prior but So forward. XX%

profitability? the going right, kind back growth, you criteria are how improvement. Good curious, size, hear just last field? enough. like like for probably margin And on be terms Or is the What so, the hit acquisitions in did Fair you it. understandably to year, there's it button -- but it think to because that then looks in pause like company's gross of or of of back getting KPIs your at some

be All of the to above, honest.

our other at technology some We to tip fishing up help of acquisition you look want likes name usually our our mean, people. we And don't would an that things the the good people pond, working. or easy we that have of to pick my change be becomes And because grow now, we're got customer natural up and from and/or just on very a there. things one but Crexendo. our everything open at to have Obviously, to and we some incorporates we to the obviously call, we've number essentially their can billing Doug metrics can look pick licensees stock I to hand say, As preference a at. aspects we're engineers the that But business. service are mentioned looking us I acquisition.

look out be opportunities opportunities those plenty not we we've size it's going into And how when company of accretive of And there, necessarily as it's the at to size there's and talked about. integrate acquisition. but -- an of the well opportunity, our

of opportunities surfacing. are excited and that the about we're opportunities out plenty So there,

Michaelis Street. The next question from is coming from Lake Max

A nice quarter.

what out international in for First one is bookings as maybe out looking QX space? the if me a that there. of maybe could in as XXXX, to to of goalpost revenue? just then expect out related Where revenue it we're percentage And sounds finish we international from XXXX did of revenue. percentage And like QX were strong

percentage to bit to sales Ron more. going and Go a the answer it let to give little discuss our Anand question international Ron. I'm then ahead,

in international give to that international of details revenue Anand we're area. locations. let on you efforts I'll our our traction is the So than currently, total see continuing more revenue, sales but And at some less X%

Yes.

we So internationally, of in to the seeing an journey our pretty a grow. the the users. kind That's we're a obviously, seeing, the because that international about with early you're even continuing going have partners question because growth started there. we've And U.K., that effective back where the now seeing big with uptick to obviously, of the are earlier respect to of that's are based We're number small team -- partners is team, some out Australian in markets. out

now we're widespread. the But locations opportunities the in we we're have being purposeful, you -- with of if that some our and team. we will, Europe have looking So at.So pretty as that given the it's also very APAC relationships size well

is partners EMEA of and Australia in that. Zealand kind and target New So area #X, that APAC after then

right. All

to Next the well into Hosted detail more the you in can accounting Maybe on expect XXXX. as X.X investment investment a maybe just the if wonder system. size one, I as go put you

XX-K. we're put Yes. our it spend Max, in think I to well, we've -- going

and who's up So us, which us. we've to for hosting contracted be Oracle, opens going opportunities with world to of a providing back-end support

probably year solution this substantially year, the accelerate spend Ron, about growth $X year think we'll I we the as fully up and as have running. $XXX,XXX hosted expect million and next probably to we next

question next John coming Water from Roy from is Research. Tower The

cost step it be other to little know AI. a as better might were you take maybe, more areas Is looking started I bit was on you to to you So try back mentioned customer Are I color getting on you us it. a can exploit curious if and it great. on help going be going got any look you that there, with give projects would you've control? at experience, Just more to sales? to

allows of scenarios. different lot case So AI user a us

And talk opportunity it's our applications so integrate system. for an really about with to when AI, we

of applications got developing AI are a And we've so lot for cases. different that developers third-party use out there

So currently, maybe or with elevated without able gets escalated be a lot XX%, have also got when supervisor with the to on and to be having AI XX% applications, my needs or a recordings sentiment act center if to is of be as able up in answers that there's analysis, call that highlighted to an gets use manager. and to that.But questions AI human we've join replaced live to superior those do using body to commonly be and to interface or on a a of analyze to asked recordings pull able a those said ChatGPT call able sentiment something and being comment, cases a one other of is recordings call able I interface questions mentioned a contact having where capabilities eliminate and be

So there. to AI our of maybe partners are that detail if, more on little third-party of give lot a developing bit you Anand, want some a application there out applications But applications.

be I'd Yes, to. happy

a is, to and examples So the us I I mean, prompts many of different yes particular use hold a just Doug business. example, as voice AI music we're generative of particular or pointed nature tool or that mean think -- are that some on that up a But things out, many, cases. seeing customized as for to I SMB opens

seeing an then make it from other growing it's to CRM a are actual the you're is to using point the productivity I'd whether host ecosystem Doug -- voice to of whole integrations summarization, voice there that obviously we internally So rapidly internal to system outward work, able from of in -- work about and developers it's provide you facing.But one accelerate check -- where guide voice also help a applications anything forward. third-party of perspective, of pair the code are things like that our just services, analysis, whether tedious whole AI ecosystem eyes million specific it's there's providers to the ultimately that sentiment users into mentioned are part some that there's that applications, well.But host using of out systems -- the we're of folks are AI makes actually terms integrations, as application extra go just if work that growing, nature, now and of whether a X yes, think as

color Great. you to A you're moving much I Can some some how to be you slightly believe you of on question. out give expect us buildings. save said there? different going

Ron I -- explained Doug Well, think that that explained before.

it's systems. much would substantial very we little is. don't have be $X take I least million will for to quantify it out surprised. But But costs, if a as be won't us cost at in hard X maintaining We we how savings

On Yes. of top that...

that's buildings. about And we're I'm great. sure talking

Yes. doing On top a leaseback. that, currently sale of yes, we're

extension a X-month did with building, we So our after sold we XX-month leaseback option. a

to, at we there new cost some pick the there. and we'll space Phoenix savings lot when out looking empty significant corporate so spaces anticipate to are of monthly some a headquarters a out attractive on in deals there market basis. up There's our And we relocate out

out So monthly that and also have center, only relocate significant of building, once have we for but rent this feel data savings we we'll on savings expense we'll not on the cost of our support services. our the

growth. Congratulations on the

next The Research. from is from coming question Chris Singular Sakai

than I -- had you I Allegiant. question quarter little segment. could a carve-out if margin. you last know know gross had the it for just a was a I overall less on And

if wanted was gross if -- see with So improvement I the margin. to could there you Allegiant there any

Yes.

carve out So have on we do that.

Crexendo came Product QX, Solutions Allegiant Crexendo Service Business revenue in, Allegiant XX% up slightly fourth at from quarter revenue for and Business XX%. revenue for our came XX% was at Service in in Product in at Solutions' the And in So revenue. XX%, came XX% quarter. our from

be AI, Just as the taking far as savings jobs? any leading that talking will cost any about to place of

looking Yes. be of user but plus will using aspects look be positions, end We're so customers perspective going it interfaces. all us we'll our just customer AI, our of maybe support, AI us where are all and some at AI generator be When our for replacing won't for businesses. customer continue their licensees we help and because internally allow a it's of from really great in And we're more XA for with will sales a our a to it GX.com, already #X to ranked support. it revenue but

improve our and should access information response It to service our will to time. shorten customer

of to that cutting future anticipate to it we we the our certainly mess anything do of and use our applecart. won't to support, proud anybody don't extent, because So up have budget. enable not in may some customer we us we're But that hires very

Okay.

Sounds about internationally? growth license good. How then can that you talk going? And is

back We'll Anand. it give to

one logos out think in in earlier, that continues U.K., that Ron Sure. the the we out logos I to We've another across international number probably or from X I up mean grow regard as board. coming pointed in the picked Australia. Yes. in X had of

with staff the continues area see chug. our respect to that marketing so there. We've that And also focus we're in a increased and that doing to

may in they but expand headquartered in folks -- So there. expansion starting out continues, or to the may cetera. U.S. now seeing companies the we're have then which remote general, And both actually offices, in are U.K., et have that they operations but that

we to think the continue I So see that across board.

And is the coming from from Investments. MK next question Kaufman Michael

congratulate way any potential is statistics there expansion potential? Is the is question I have in for partnership. this balanced to that. had Because get for total is either the or revenue team the available any of and maintaining a handle industry. segment user unusual TeleCloud the revenue I on And specific what both and growth the which profits, I in want a growth market you to on don't of

answer let Mike, Jon that. ahead. Jon, go to I'm going

we old we're So telephone TeleCloud -- service a POT specifically plain call replacement replacement. what a is line or

that AT&T California. service filed recently traditional -- with a the charged service at the be individuals price places are, will, there's this state estimates You that -- line by U.S., line to, traditional also in services. over service State lines seen their are currently FCC may recently because And of POT copper being have in detariffed seeing.So $X,XXX they're some that's their the where seen to able some is cases that X over the with in are industry a companies the increases decommission in all of of million

that's way lines supported is specifically the that partnership that plus lines alarm to line type fax TeleCloud so, And great migration that in type to of to hasn't think is be a die of easily replacement too. be migrate the fire us to cloud been those the to can -- targeted line the licensees find alarm something gives the analog been opportunity cloud services you able lines, if participate is retired.So million of infrastructure the and so as copper those a in other in they service The our won't service any and POT X past. movable of lines,

sustain interesting you the prospects. legal these and like companies to an stuff sounds entree of that into the to It enhance get because Yes. growth requirements

like an sounds interesting So opportunity.

about excited it. very we're And

And for no now to Jeff queue at hand questions other Korn I time. there this to like the are would call remarks. in closing back

want for their I attention. Thank you, and thank everybody Paul. time to

excited results. exceptionally about tell future results. date we've to in seen results We this will, you and excited everybody having future, not-too-distant our can the the be in about our I QX And room is

enjoy in we speaking And May. us. ride So with will you. look Have forward to a Thank great evening. the you with

Thanks, everyone.

This conference. conclude you. today's Thank does

You time. may disconnect your lines at this