RingCentral (RNG) 7 May 242024 Q1 Earnings call transcript

Thank you for standing by. This is the conference operator. Welcome to the RingCentral First Quarter 2024 Earnings Conference Call. [Operator Instructions] And the conference is recorded. [Operator Instructions] I would now like to turn the conference over to Will Long, Vice President, Investor Relations. ahead. go Please

welcome Call. and First XXXX Quarter Good to Conference Earnings afternoon, RingCentral's

Joining Chairman Shmunis, Sonalee Vlad me are today Founder, Parekh, and CFO. and CEO;

and Our followed today will prepared by format include by Vlad Q&A. remarks Sonalee

a have will under that the today's Relations with results section also on at our slide We coincide can you Investor which call, financial website available find presentation ir.ringcentral.com.

company's subject outlook. and will some contain risks regarding the Some These uncertainties, are questions forward-looking and performance are your of business our responses control. our of forward-looking guarantees beyond no Actual statements are financial performance. we to to call. results and discussion and differ statements They obligation our operations, statements not from this of these update after materially future to undertake which may statements,

with uncertainties well discussion follow in the our earnings in our complete release. Unless of to is refer the and our and and release Securities as otherwise non-GAAP non-GAAP as the earnings risks the Exchange to all information provided related to a indicated, Commission that with results today's slide all filings are contained of GAAP please business, Reconciliation year-over-year measures For deck. with comparisons.

non-GAAP forward-looking in not financial For of Investor measure website. slide our Relations in to reconciliation guidance, I GAAP certain the available the corresponding a detail guidance discussed the is as posted on

the to Vlad. turn over I'll call that, With

we with a of consecutive rising was for approximately operating $X.X driving start XX%, above for a record end X% rose and quarter quarter. quarter the billion, to welcome to with had profitable Consistent high above call. with the profitability solid In QX. to XX% million, outlook our outlook. of our fourth the afternoon, enterprise QX, well which Good to to margin ARR first of strategy revenue $XXX our delivered year. XX% growth, up We our Total rose conference

another stock-based am have compensation percent progress revenue. also improvement in SBC reducing as on a have we delivered as quarter material I of the we of made proud year-over-year of

resulted Our in combined share less increase in execution count SBC. in our diluted declining expected for non-GAAP in the with already operating fully year-over-year SBC, in in year-over-year year is program, full Xx approximately result has to repurchase an driving history. our share profitable first profit time our growth Improvements

haul history. QX, be Speaking ever. their of to deal largest billion main signed RingCentral, We seat RFP address win, retailer the include making points, drop $XX call over will ability that With long win features. won and XXX Skype pain ] competitive able In a voice excited and call, of RingCentral this [ seats within to while I'm XX,XXX Phone share in Team's Teams in UCaaS against sold a which revenue. will reporting operating customer we Fortune demonstrating legacy their megadeal ecosystem. solution to [ replacing with ] this lack for business to be times, our our inadequate advanced

utilizing than our large Teams. our In enterprise TCV deal are with $X Microsoft customers to of alongside have majority were And million half solutions more of in QX, fact, the our that Teams. integrated and customers

in was vertical, care, gold retail sector. public services, Importantly, this one win and financial of which professional include health and our

ability integration. platforms and to mission-critical CCaaS thousands unmatched vertical are win this and cases, UCaaS available our we our We in given complex and reliability, integrated solve our use of

can time. convert enterprise. driver, we at And over has are that vertical that seats we this been there million [ XXX a especially key in vertical in believe This growth least ]

as partnerships call on you trust, we Let me now more give it. of we which and or guiding is win, why centered our principles color around TIP innovation

XXrd uptime NICE X straight achieved We quarter. trust. for First, the

reached NICE. In we've of milestone new fact, year, a over the X past

moat battle-tested differentiator. and and is platform secure, cloud wide compliance and competitive the carrier-grade, to key a standard Our continues be

We core well is especially API certification. in ability customers large horizontal used gold complex integration, workflow and into and verticals. commonly use as cases these industry-specific strength and our communications vertical-specific of customers applications, as business to Another offer our solve integrate a breadth

the patient businesses. data vertical, into their care needs compliance management Cerner Epic HIPAA we based HITRUST requirements. workflows customers as as For of example, meet applications well within create These integrate can and health and such specific as their on

RingCentral's For and example, system health automatically care to the trigger to SMS. directly pharmacy appointment send via electronically providers API can use reminders prescriptions

this retention employee solution with of integrated factor With workflows and and also patient industry-leading Sanitas a its Fortune wide medical This power a UCaaS inquires. [ unified customer integrated of operator provides. the Additionally, the ability in [ experiences cost quarter tools why supports our U.S. XXX should revenue experience platform increased centers integration. that communications UCaaS in to seamless to increase have as age platform a lower platform. was the will with scheduling, variety is in be our use able customers from this CCaaS believe selected provide RingCentral, well our RingCentral, the billing efficiencies ] differentiator. and and drive companies general integration with advanced their cases CCaS key Sanitas as RingCentral improved market-leading vital We to from streamline the across With the ], and

to should net combination care gross retention, The macro drive of gross and focus introduction retention on our customer scores. resulting progress going equally These our point, improved important in activity QX. in is new NPS this trends X customers higher new value. existing and as retention of renewed lifetime the But robust customer examples better customer improving and On are just of retain ability is forward. better our acquisition maximize in our products

high able With in industry-leading won signaling innovation a the on as innovation. AI a with and UCaaS of users RingSense started heightened generative RingEX, of in and announced note Connect name because to with on With Now won the time, past key experience. solution change, One decisions are action we reason RingCentral Employee stands key this of to interaction. RingEX change we we Award to based flagship commitment to We on our AI This capture [ are from our ] MBP accuracy. continuous for for quarter, technologies. off enabling referencing is emerging real-time differentiated Enterprise industry-first, spot real AI items this we our on best March. overall track feature, voice which

It are but already users is significant early days, time savings. seeing

an all data has them customer been the attached minutes notes one XX-minute easy example, X we empower customers AI of has context take that RingEX, the scale notes billions integral part also place inaccessible advantage For as Voice-driven With largely future at being to to millions their real-time data RigSense the referencing average of on allow to highlighted historically [ for platform. call, been conversations of call, our take that an of post keeping interactions. while siloed. now ] for saved in

employee to the tasks, more innovation, customers unlock new progress and products. on streamlined now Continuing now manual on able insights Our will customer theme of our automate deeper create and workflows. be let me share

interface. contact digital [indiscernible] interaction and First, is provides logging agents to which and for voice RingCX, screen AI-powered and XX-plus interactions, CRM, simple ticket capabilities channels, the easy use to with automatic user creation case deploy digital across in and center, from our intuitive all-in-one all all and which

most the quarter customers, almost France, now XXX U.S., Germany We the and Australia. is now RingCX recently, U.K., fourth double X over Canada, available versus have RingCX countries: XXXX. in

the seats our from Two RingCX customer in and One, our In care United questions. income purchased fact, a RingCX licenses for over prior XXX,XXX business Metropolitan Borough one planning, RingCX outages; integrated their housing of win. social Rotherham QX. They is newest using range and cloud unmatched X,XXX be factors to over outside and including addressing our Kingdom, key the RingEX for provider and had our RingEX regulation Council RingCX they U.S. consistent XXX services and as their reliability solution. almost fully will of in enforcement two, provide residents, in

RingCX. over integration We and new XXX features innovating Salesforce, are ServiceNow, total to HubSpot, into native Dynamics. We are in added bringing the Among the over QX, Microsoft of RingCX with X,XXX. Zendesk features rapidly

Dialogflow, partners such Yellow.ai and as platform Google, growing also have to a enable opened the [indiscernible] ecosystem We RingCX Cognigy, of Calabrio.

packaging results going to in will voice, strength and maintenance pricing of RingCX ease we use forward. us positive that continue and and give attractive Our see from our deployment, confidence

We for portfolio. first our sales, in the good product see to RingSense RingSense continue traction with also

We benefiting from focus our are Many than customer analysis automated the resources and doubled frees to selling tasks. over on more them count customers notification, summary, to have XXX. sequentially [ performance This time, performing follow-up up in scoring, allowing interaction QX sentiment sales people's administrative management. ] call

conversation. insights services using insurance and example, not to insights have choice, to random practice. in the is we agency's efficiency RingCentral sales within voice what's For sales customer the monitor Sales, AI-driven by caught and to are from visibility glean and helping all in the working of for and the organization, agency able data, Midwest client identify not gains. working into sales word productivity energy their valuable agent our an is seeing gain would And listening own RigSense both sentiment RingCentral's deliver insight a they selection

one to able and summary at That potentially least with X automated win amounts to extra now a about or are note week deals. RingCentral is X workday save employees Our features. using customers from hours full day more speak

logos Events roughly sequential new business provides of which XX% outside a the first in events, of new our increase line with into typical expand to opportunity personas quarter. Lastly, including the RingCentral in us base, decision-makers. saw

are New University, during These companies and [ AI such company Systems, world, a which that enhances competition as in to were Fortune ] first Last continue business. AI receive. for writer such partnerships, from Detroit Events quarter. as and the differentiate Vanderbilt least, of contributors the selecting scale the the categorization key multiproduct not our features further a largest the value also customers to customers the but XX important technology feature RingCentral events QA media to to one continue and RingCentral

AT&T, over Deutsche which We partners, of Telekom, Telus partners, of providers, largest OEM network diverse global channel a which number AWS and a partners, includes some BT, service XX,XXX Communications, Vodafone. Charter strategic the of include and large have

new We for our growth during Optus, and first are growth the telecommunication Australia's rate. quarter. overall also continue of growing services above largest announced a second to network driver expand and key our GSPs with this provider are partnership RigCentral

We including retailer. deal with where QX, large won in cohort European a saw this Vodafone, a seat X,XXX traction plus we with with good

largest GTM extended of seats. UCaaS of term CC collaboration world's enhance model. exclusive the our in our QX, be continues holder to continue on-prem provider. they and multiyear RingCentral Avaya's And innovation and agreement UC to and Avaya, be the Regarding we

[ We announcements expect the the for ] sell with upcoming and to Avaya to at work additional even Stay Office Cloud Avaya users. by of Avaya ENGAGE more position, existing week. RingCentral conference product tuned onprem Avaya million closely to market joint next

our to closing, contributor whole, believe that a network solid. will our was be important profitable as growth. partner continued In We broad an QX

are executing priorities. all on strategic our We

Our strength call is expanding, our Sonalee. turn our core flow very demonstrating is about new are over inherent free demonstrating improving, excited let the that, I'm its growth With stabilizing, of SBC business our the profitability. and is and products our to future. cash me our traction,

highlights almost I'll above billion. XX% revenue neutral traction quarter and good provide while business discuss billion range. outlook continues guidance year. our second Thanks, on verticals. million-plus XX% many QX, first customers, year, full In in year-over-year $X.XX from of ARR winning was currency deals basis, of $X million rose of We ARR large a XX% represented quarter year-over-year, TCV On headwind. $XXX end was the up versus and last million $X.XX to Vlad. versus subscription well with the Enterprise gold an last currency perform then a the saw sequential to for high year. basis, our and our up was $XX

includes highlighted, with a than spending this that committed figures us new over next XXX has few Vlad As X to the Fortune retailer more years.

otherwise profitability. be with was again noted. non-GAAP to to I'll margin gross above moving XX%, ARPU quarters. prior referring $XX. Overall consistent unless was results Now Subscription

than accretive Our ARPU. are new to higher overall to we increasingly time, retention. overall ARPU ARPUs and products Over solidly become product current new expect

to outperformance was XXX rose above guidance XX.X%, timing of by operating margin to upside XX.X%. points as our of year well driven the versus revenue The our as guidance last expenses. Operating basis certain solidly

we Importantly, in our to within spending continue sales in and particular, remain marketing. disciplined

Moving to free cash flow.

nonrecurring to will guide by free as we We cash This closely in items, cash reflects includes and generation net expenditures. activities out restructuring, more for the a capitalized less interest provided flow of reporting we'll as cash are other defined our business and paid period flow, cash separately. call given such operating and now which

$XX of In $XX cash cash strategic first $XX million free XXXX, the payments as generated interest partners. million $XX of is of cash from million quarter million. nonrecurring we well flow of of for and net paid This received certain of as

to nonrecurring $XXX items, and in growth. Excluding million XX% of been quarter flow the representing would of have million interest impact first over compared free cash XXXX, the these $XX

Moving stock-based compensation. to

percent of fell versus XXX a to As compensation last total year. points basis down revenue, XX.X%, stock-based

stock We both new expect also in to new continue of in about of remain disciplined and forfeitures and XXXX levels. to grant on be grants employees existing half net XXXX

to Moving balance our sheet.

shares repurchased previously During million currently by the total remaining X.X million. for our our million Board an the authorization by authorization. quarter, of plan our $XXX we authorized our Recently, million on $XX Directors. $XXX We Board increased repurchase incremental have approximately under

leverage, we believe the current we flow, that our cash strong valuation, an relative down provides return. and our made significant progress and repurchase Given bring growing share free have to attractive

notes on million of [ our our convert shared plan existing to maturity XX. XXXX had We a last March our portion date quarter in convertible outstanding liquidity and change our flow no XXXX convert. of free our to XXXX. in to cash to prior $XXX sources the March utilize retire Moving is There ] its

leverage EBITDA and year-over-year of XXXX QX as Xx by downward gross debt. net declined the we continues which our end Our reduce to expand to at X.Xx adjusted trend ratio over

credit Our alternatives range XXXX us strong growth improving low BB and of strong convertible notes. for our and flexibility cash addressing leverage a gives free and ratio, significant rating, liquidity flow

me let turn guidance. Now to

XXXX, for expectation further quarter With guidance the subscription growth current macro or trends EPS non-GAAP versus our and growth backdrop, of XXXX first operating X%, margin we that of of $X.XX in remain to $X.XX. environment non-GAAP XX.X%, X%; of in to second improvement the Embedded is expect of revenue the conditions. stable total the with that deterioration X% relatively flat revenue quarter no material business and of

our revenue [ year, full of to representing and expect billion QX reflect outperformance. X% X% our X%. are we $X.XXX of $X.XXX We outlook raising the billion $X.XXX ] billion, billion, representing subscription to $X.XXX total to to X% now For revenue revenue of revenue growth growth annual of to

expect operating approximately XX% total to a of of and margin percentage XX%. We non-GAAP compensation of continue as stock-based revenue

we XX We non-GAAP XX as $X.XX previously. diluted to million $X.XX EPS from and are to now to $X.XX in shares to down XX only from million up our shares raising million expect XX XXXX, $X.XX outstanding million to

$XXX million. we $XXX cash cash flow, flow our expect under definition, free Regarding free to updated of million

cash cash Our $XX outlook for and $XXX $XX of certain of for other paid items million million strategic from cash to $XX $XXX paid for nonrecurring restructuring million interest million and million received partners. includes of as well as

we Excluding nonrecurring from million, million $XX interest our our raising $XXX $XXX $XXX to outlook. million from to free these to million outlook up $XXX in items, are cash million flow prior

cash flow free collections Our commissions. the we guidance cash seeing benefit lower updated and are from better reflects

flow contact also strong free to cash had annual In are and are from outlook. for center raising billings a our We benefiting the summary, we a shift start some year and upfront to revenue customers.

go-to-market leading cash position profitability value. scale well with laser shareholder for flow and driving combined and differentiated creating Our our long-term free products focus and on us unique

the With that, let's call open for up questions.

question of First Instructions] Bank Rangan from [Operator America. comes Kash of

in company you Vlad the you. for Sachs. deals forward? tell It the looks amount. tell you congratulations by of than flow as enterprise enterprise, you going be of slip One, company. that cash standpoint. it product and a is looks Goldman like Can meaningful is I the or competitiveness growing strength execution tell for signed. free if rate what like Can that's guidance can overall how free sustainable the ARR With flow growth us the the is XX,XXX strength in, cash evidenced faster an you It -- the raised driving relative area or us UCaaS by company question you pretty us could certainly,

good To be product. the question, product. an continues first Okay. look, a have we to It industry-leading

We continue innovating.

now deal both we award respect what That's mentioned, we but look, our whole, particular, wood] it FiveX for at we it multiple It's And of tell does think for with enterprise Enterprise strength ever, blood, -- use to -- knock don't years bulletproof, reliability, specifically and are AI I instance on we to and multiple the lot show overall of is history. availability. sweat years just not that we're offering. There I people, Connect. known as deal, complex this With can of one particular was this went of the address a on in for We're have accident. been in [indiscernible] about years positioned to you, X.X matched, not differentiated for okay? into That tears for? has won [ known I by known As cases. by SixXs. and we come of time big are a the first a uniquely this and many, over many come won think best many

prepared general, this some times call enterprises. establishment, their of is the in a retailer. handle chose whole ability is call to them for noted times the well and have, messages what's of As pharmacies. one, examples, cases in many call in big particular the particular, reliability happening and our part deal . This the a retail They use during we as also as as case, remarks, in will just meaningful

et of about spite ways But over, So big of fully want we and also taking by but verticals, that [ is published this way I again, importantly, all as be BXB our that people picture. care, good retail, fact ] left. mission-critical shine. over, times of messaging all over cetera, rhetoric of want gold what's of to during [indiscernible]. million just amount a winning can includes internalize picture in see saying why are its product, to want primary And and to financial, modalities the the in enterprise greenfield the cloud we're a important, the medium video out well we huge includes really which video where voice still report but over, continues we reliable, is the big is is hold in very to messaging. on e-mail, the seats communications people Salesforce robust, a featured. The we and I give of have taking easily here happening But incredibly taking of there. those have just not to better Sonalee especially mic the turn and prevalent modes it you voice I for health includes which XXX and

And as absolutely a far and have win stabilized largely we're was have we SMB, in see on our enterprise. way It's to tell we we'll abandoning there that relatively not this double And a in least, quiet is redoubling abandoning why what, on not recently not right our we winning focus, enterprise, Well, and our of underperforming challenging we but showing continue still that by rhetoric know, you we as growth left very will lot macro continue is also down focused is SMB. there of relatively that RingCentral focused We're still I'll We digits you to think doubling there. there. is be efforts for enterprise is enterprise. there been our on juice

position -- very We in also very have protectable strong and a to right win. the strong

as we'll well moving results let's showing say, optimistic good forward. So there cautiously be I'm that

Sonalee?

we the call are on Yes, flow. proud of Kash, we delivered. thanks, Vlad. very cash And what for free Thanks, very,

margin, year, way, know, now by look basis where is XX% benefits unlevered the but based margins efficiencies . With XXX you and XXX profile in we're on at year. flow. are it cost today, flow only are this cash really about flow cash points important of cash productivity margins nearly and in year-over-year. last -- took I've big on And So adjusted expanding grow not expected as to free updated that if guided realized free seeing guidance. our to basis a free expanded And transform base, operating reflecting by steps points we you we our operating the

a realizing flow converge are that lower years intensity the P&L. the operating commissions really we positive sort impact This amortizing of telegraphed we're trend the over margin. starting of is So through deferred because of the of we're free last cash that margins with couple to

realized also working contractual and we've commitments of payments. upfront efficiencies capital And our significant long-term to more shifting

growing real of on focus you this and the flow, per of cash to power flow provides revenue our and excess know share with both free drive a hopefully down, as growth significant driving the flow growth So free driving cash growth. coupled SBC that overall opportunity free cash well. which in

of we reported improved percentage by will grow free cash So based cash guide we free about our and outlook this midpoint that that quarter. year, flow XX on since last the expect our flow, per about points has on share XX%, last

outlook the to free cash will we've on So growth free improvements given that to deliver year-over-year. hope cash judge expect you that will the now which continue given the strong in our We us and flow on share reduce we updated on you share we a count, sustainable basis. per flow

The comes Samad Jefferies. from of next question Samana

Also after cash. go honored to

to Q&A. the I your guys I Vlad, But the of got order first that's be the the just context love the question, of in obviously small I millions larger about doing it's large of think are Maybe of individual seats has. one well. about deal, -- I when hope RingCentral as that overall So think you deals.

And maybe on a the in of terms like you a like how expected the maybe size winning looks just what of signature could of deal, of what it win? us is, time roll in and given into it's double-click So deal and line so led like the this forth. features, big out terms what help so deal the the looks

to It's matter then customers just billing, doesn't the -- in agreeing Or question are really you upfront on discounting the any timing collections? just that's does And them. -- on just upfront that -- drive there is going well. to that squeeze certainly, to upfront is a the and stub who for I'll that as the

your Q&A. position yes. Glad to in have Okay, on here the Samad, you

Okay.

largest, largest. the it the wasn't was the deal, one as far of it as So

particular interesting, to again, and positioning be types Business. given, cycles. some features. are these -- X-year out of right as And especially [indiscernible] okay? already months, the So rotating all customer one all middle, I X especially and is enterprise This in as the of happened long, [indiscernible] our XX generally for about differentiated far Teams in to it's of them. this Look, mentioned how Skype is deals This of

do So else it was a with don't you deals, reliability And do probably know but competitive and features, imagine don't so cash, this always is [indiscernible] mentioned has who okay? . And had. are We installments. usual RFP But is as only think the already it there really involved, of again, process. large that are have we I the can suspects. many them such we a other to

of spending XX% -- so they're us. more of which our as segment, we part with $XXX,XXX count have We which is enterprise ARR GTK

in So large we accounts. much are active very

a phone. we extension We integral are then against have And or and work major this continue some Teams and Teams chance to We you via an enterprise we with itself, can or into Phone. that there this this co-exist part really Teams again, is Teams say and being is And want we is Team's as to we thing, -- provide back we this understand success and this, We strength. So more getting but case. APIs. we there. with okay? believe need they And to that's to available Teams partner there have Teams one competing see, the the Phone. do that a [indiscernible] going good support continue and compete We how

we of today. best, what believe not really on integrations best the have the We if market the one Teams

I that the So answers hope question.

nothing there. really Yes. to Sonalee And respect here. discounting, Samad, mix there's out shift. a call question On It's no, your to with

in increases in obviously more much total than grow and enterprise to common overall more month-to-month. longer-term enterprise in So as contracts. upfront bill of composition the which us we say, helps that's And often to SMB, upfront enterprises our is it revenue, and billings

comes The Ryan of next Barclays. question from MacWilliams

continuing for or the Also the one one Sonalee. with Vlad, X-part trend and for question,

But pipeline, your free And SMB like CCaS of And and and result uncertainty, and flow for Sonalee, you as we in pipeline your then to R&D Could was marketing up. cash look Or enterprise year? investments this a for this macro step revenue more you leaving start year? or use any conservatism given and have the For really for margin does the are year? additional just between rest a operating looks maintained. opportunities? sales room UCaaS the the of just noticed like the the guide how trends nice this and non-GAAP, whether

Okay. Look, pipeline.

have usually quarter and a what guided, as we guide strong is had believe a So well. good we

And cases, tell SMB, enterprise easily pipe. the would is feel months. you about a X many and that good should optimistic relatively very plus we cycle. months Between so that at in and SMB X because they're to year different under enterprise, again, X be

that you we different So seen dynamic overall, over stabilize rates pipe feel you bottom, if not will. are our multiple there is very there. a enterprise finding But again, a lot less, we if important, quarters. but have just And it's

well. we're seat we're counts we're still the far is opportunity, ourselves, -- seats pure us yet are greenfield million the still of not optimistic under And size not this as right? by is And from to from but XX seen have which in You we according that SMB, the third-party given research. lead that

again, for disappointing XXX% are limit pretty will not people. and new on we're the products, you of our that have continue we that's entire may million, the Some optimistic the our a research tripling across just And given holding AI example, not and are the portfolio infusing innovation, got we just into we which recently, doubling the $XXX okay, that being in details opportunity to on down own way enterprise, the and overall still go. [indiscernible] with are

Okay.

question. the was that think I

Yes.

on So the margin question.

with the held from improvements over you so, overall, the profitability years have So I've gone say, today. to guide the XX% in where XX%, last we're we've margins happy as X really or driven

need I growth balance on product really, feel maintain marketing to investments after in go versus profitability we need either to we the to we flexibility innovation and think some attractive side. able to be

act. balancing unlevered. you've is up pin, campaigns, And say really we guided the about took That's vertical-specific gold cash I've hopefully, XX.X% operating from the to talked We margins XX.X%. see what flow on adjusted I yes, closer that margin, we a seen as that to would verticals, it free

So question hopefully, the that answers

next The question Panigrahi Mizuho. comes from of Siti

I to the next you ARR by million hit about wanted RingCX, the to $XXX Which you products between one excited that year. new about ask of you RingSense feel end more expect do installed partnered your how your also, And to your versus RingCX, how Events? product base? -- RingCentral you as try features adding keep within position you and to do you product

Yes, sure.

like with which it's multiple Well, best. of you kids, Okay. those daughter like asking you for

political some there's them to will be answer or of correct So else probably We like no them. that. in investing not all

far -- very as As they're different.

talking of the products. which not we're really products. the X family about So is one of but product

Contact because which it's other for introducing RingCentral but is sales, the verticals of in it's Center, So and products RingSense RingSense first for for family and we to it's us industry-specific Events RingCX, solutions. its our expect be

on I And second the covered question, think it's use this understood. product. easiest is very your it's getting pricing and and CCaaS because to is differentiate quantify market importantly, ease packaging. the RingCX AI-native And of of to relatively part well well an

flagship it which there X. UCaaS integrates seamlessly infused So product. RingCX, with AI is from course, of is our And day

say achievable, we are not across goal that of internal share which X okay? ARR confident our So we to this going all to suffice feel products at million point. But projections, we have $XXX is that

on than RingCX both customer quarter-over-quarter. we even and RingCentral that's numbers, just Events or and counts doubled doubled some mentioned have approximately We more

is is demand very growth, of both strong there the strong for a obviously So, them. Events. necessarily

growth, do strong. can in, is we very Well, think still [indiscernible] we it XX% get which think I I quarter-over-quarter very,

multiple of example, we it opens all the again, CX, So other tell cycle. an tell it's for each what virtuous early event us with sale, with with all forces And in but okay? industry. having for to for itself, you EX them, have very it's They I promising, so and opportunities RingSense very absolutely when

next Marshall Stanley. The Meta comes Morgan from question of

on This Meta. is Jamie for

RingCX. with And you the able you base existing just much see to detail in customers from traction seen that conflicts of you you take have to are following that any to what those partnership how seen terms any customer? I comes with present just nice guys the last running on any up point, try think challenges you direct? with that customers you versus great provide in guys have that, then a to maybe any have Or the of NICE? to new? of on follow-up Are Are to as getting

in To question, it them not be to take look, agreement your them of letter would that for last direct. the or the for spirit matter

not in aggressive So are As content-base many trying price Again, some We're points, much not, of convert very necessarily base, okay? or say from more products NICE we base install, ways, CCC, our not different as which when very them price but hope use, base, are to the to in CX. simpler points. from far X complementary. base. the those different is not, coming you is RingCX to

course, Of on it. we have owner economics

product [indiscernible] margins industry-leading flagship really So mass it's more healthy. if RingCentral Gartner that cases, which had. as Center, to is are market, to will, you use But Contact designed NICE opposed the simpler address

very into rules products will -- to be to walk qualify we see clear between we have EX So When lead, inquiry okay? which get to be products present or a once CC of internally. customer. it we'll the which presented it's will to an rare we that we or self-imposed fast, a And again, do, engagement [indiscernible] we So and

from Tim Oppenheimer. Horan question comes next of The

expanding you contact RingCX, from you taking a kind it if for out capabilities? Teams that what there go can then where rough to? On Two you think you like do center external kind have do seats sense of market Do a more share what on phone I are yourself? the using might. now secondly, of or have companies existing? agent calls a of versus it Or teams, percent of of also, maybe is And sense number outsources adding of Microsoft just users has maybe of and sense percentage of other Microsoft you're

you Microsoft, mean, numbers. I No. have the

for external. internal within mean fact than that the I Our use a people Microsoft Teams, more well-known think I use it's

vertical, is gold you it tend So there. it we market access gold left And okay? so consumer have way, to me let needing or of whenever to we brands, care be Our health greenfield This just between or our shine, okay? be huge their very still all okay, these sale some these, gold call, BXC, where retail, verticals verticals. a financial and large are amount answer whether what this

what part the Sorry, CX question? the was of

small understand, number first growing before. you shrinking the point your if this business, time they into you're price people to a maybe go are business is have agents use. of to but this Trying Or do of kind didn't for easy enabling you're think the CX? in low and pretty capability you Do to think

Absolutely.

I a industry your count interesting question question quarter-over-quarter, of will early overall agents your And are growing growing, there think the number quite we and But our obviously rapidly are of we're that's replace obviously, is we course, if because of doubling line really thinking if cycle, So nicely. is, just of growing this agents. that that is very in about well, AI agents, mean doing question. in

that we I decreasing. time, be now, more will over stabilize For in that. I and do also are of the agents. believe humans seeing augmenting number AI subscribe industry overall to

reason, and and for into assist building agent that we're agent-related capabilities CX. copilot And even AI

So It any this not that or is the this being. than be always case human in across case good a left. and It's taking absolutely the industry much place. already bot and yet, also versatile, cheaper is is the be not will as wouldn't the the agents

you human of can That's behind would actually fact assistance the to this point You true. functionality this and before. kind for they businesses. human [indiscernible] the that interactions of type not small human the tell stay they do and priced from well. many made as personal differentiating [indiscernible]. my that didn't an I if with way expect of showing about you box, access medium to to the interesting and type is them I small provide and touch that that, I hide themselves of on agree businesses, future have and foreseeable

are there different So here. dynamics

it saying, customer. the business look, approach we level, high As and is a at how

and lighting this you if solid are as start to revolution fine have okay? do that the more feel you you that's you and as than that augmenting because platform. can map. is, without the experience as road we're their agents, evolution reducing your good see agents technology, in So want a you the get well and which of leaving an ready If your just that you [indiscernible] up is to here we a it's experience, solution, will cost number allow the effective of well more comfortable, here of seamless human simple and relatively experience customers' path agent solution is as of empowering

next James. from comes The Raymond question Brian of Peterson

Congrats on the quarter.

really couple you the I'm years? a So is couple was that of of Or profile next channel over the thinking curious, are strength? growth are through there notably GSP a Vlad that are how driving quarter. strong this that that broad-based about And comment? that

With GSP.

that. surprised one this So Look, actually, because people this. we yes, and the unrivaled concentrate a this is thank is I'm you for that really [indiscernible] that in industry. area not asking built asked question where and more on have practice

they software okay, have all worldwide, with BroadSoft was them. really they have licensed in bought on-prem about which which XXX an perpetual them just which think of something you provider [ In historical And many really ], bulk. If carriers almost terms, licenses, few years licensees. like cases, were carriers ago, is provided a

on now, on-prem. wonderful a number exit of just now and and owns is natural to not The There they platform okay, and was this nice and it's Communications as thing And has not a a the extremely well, of with doing telcos product. It's for example, still path our Cisco them. here company and Charter the years in GSP has cloud not is been innovated our telcos it's very okay, telcos cable what is member do providers they're and well, partners, a telcos. are

and realizing BroadSoft are [indiscernible] on it underway. have increasingly have just move that's migrations and software to seen are day almost age ], there this with which they they there really -- prime. out mass So [ that

very So are we about bullish the channel.

individual second both and adding nicely I as logos new by sales call we major are seeing GSP Australia's as well where we believe, Singtel. largest, announced growth growing it, are each Optus, every same-store have We is from, owned

we have there. So imagine board there playbook. BroadSoft, BroadSoft. number accounts that We from of people to be you look, And know who the used conversations We are. very a can across the know good are the what

of We also approximately XXX the had, that fact of X% of well those. are the out we that have they aware

our is be very a strength and year expect But in Day. competitive it low there. we more in Analyst an And sharing So we runway area of this will for to later at model -- be perhaps definitely the nice us and

Tillman last of our question from Terry And comes Truist.

with on with some reacted evolved the RingEX is selling Are multiproduct curious This for organization the the potentially curious productivity Bobby has I'm there how platform of change. approach? Great. I'm on Terry. a and rebrand. table for Dee gains go-to-market more the

Yes.

I think this. people understand the reason for

does mean been has Best reception strategy. general They by people showing the understand means remaining bundling RingEX. will capabilities that are media look, from that are to positive. we're message the relatively Enterprise phone, a what Show what It can that about. group, as you with near that all is redoubling the in just excited think And It was products I quite we changer. about even won in our importantly entire any future. I and multimodal modality, It's is not universe it semantic to game it's coverage on here, tell beta, than in you which internally and these just experience the particular, of all more close and and can do of of using modalities. This of modalities AI across infusion But together. amazing more across be showcasing part we're it's portfolio the even AI. about that but This in but more capabilities integration MVP, what we're beta is we us are expect these Connect. that we

be network, a large it to results apply achieved. can you If what kind just of

concludes our this call. conference And

now You disconnect. may