Sprout Social (SPT) 2 Nov 232023 Q3 Earnings call transcript

Thank you for standing by and welcome to the Sprout Social's Third Quarter 2023 Earnings Call. I would now like to welcome Jason Rechel, Vice President of Investor Relations and Corporate Development to begin the call.Jason, over to you.

Thank you, operator. Welcome to Sprout Social's third quarter 2023 earnings call. We'll be discussing the results announced in our press release issued after market closed today and have also released an updated investor presentation, which can be found on our website. Social's Ryan Howard; Barretto. Sprout Preto Joe are President, and me CEO, CFO, Justyn Del With the Reform Today's are the of made will pursuant Securities call contain to Safe forward-looking Harbor of XXXX. Act statements, which Private Litigation provisions fact than historical forward-looking statements. All statements at are other statements and plans words seek, among include such anticipate, our should any plan, update believe, be date undertake views business as as as opportunity concerning and our or reflect can financial performance and not our expect, These only objectives representing today future statements upon not be of do path, these statements. to will.These statements relied and others, and views identified subsequent by any intend, at duty we

risks results cause and uncertainties address statements Forward-looking that to materially. to actual matters that subject differ could are

For with be principles. with these financial the earnings and quarter that, available call, release, Definitions with and let the along furnished the actual XX-Q and please to accepted important in been non-GAAP to are we'll to refer generally could Justyn. on GAAP on not XX-K.During previous SEC our call investors.sproutsocial.com.And over that which most is with our of reconciliation financial me comparable financial September our discuss third ended at most quarter prepared measures, directly as are our measures accordance in accounting turn included risks the XXth, for which results, recently XX-Q website the measures factors filed Form affect filed quarterly the to report SEC, our to well as the non-GAAP discussion of other XXXX has

Justyn?

and spent always month, in the afternoon, us. opportunity establish winner everyone. Thank Day our as outlining the revenue path joining ourselves to you, for to we market. our in milestone category billion At Chicago $X rapidly Jason Thank the you a on Investor maturing good as last time and

partnerships a ARR discussing of starting business. our and We people products, Day maturity of rising segments, which strong time Tagger amount any combination quickly and market what our crystallizes our every company software, reflect and than product for customers, our this RPO enduring This XX% considerable geographies, and Sprout have growth in of share in over Investor today and multi-product history. growth over momentum.We acceleration rates that day. more centered execution entrance next performance in is across XX% maturing spent customers in continued share was on ARR, team, a net with through This combination market strategy which at our we product time leadership delivered ACV the to enterprise at goals. module Our products, more of upmarket, stage attach our our leadership is XXX% We're by market today, end the new will in at more amazing to our software and ACV accounts these a chapter.During an line business stand an great in delivered Ryan our build growth in and results most is the evident perhaps driven breakout of record marketing further This and of XX%. in branch powering will was our of than strategic saw premium acceleration than growth of new high you. maturity year-over-year growth pleased enterprise utility the that out The total some delivering ongoing every ACVs year-over-year. XX% at against year-over-year goal plus a influencer amazing for record total QX ARR strengthening XX,XXX growth our of and fantastic QX,

strategy. unify and it products potential see should of haven't group key historically our to base of hasn't has associated you that we Only our from stories current platform hear to with premium component massive more customers our Sprout.Another adopted or what execution X be this going than XX%. all historically in complemented were You're and X% surpass customer heard of that standard is premium impressive social capabilities of module was, for stronger our our This with of premium were leader, global Tagger. to than We this more increasing also QX, excited rates marketing businesses. QX $XXX performance quarter. module influencer Total attach million during ARR course, even future acquisition

position of acquisition thesis in to in that one is also a their to creator of designed reception was point integrated to progressed to the early deliver strategic recent and this October win Snapchat's exceeded handful and differentiated participate network's was Tagger functionality to our smoothly has category further ability seen.Business rising not our highlights leveraging and this our grounded expectations. right play was create selected deliver with validations companies social, social workflow, and Our customer and to as thesis suite NACES by a only the existed.One more our launch marketplace Sprout our analytics Tagger with API. previously customer we role our of Tagger has positioning not reporting incumbent of integration of industry far has the to that

an a and greater felt products business alike.With customers businesses and and inside have value expanding be excitement have Sprout our has set a been and than our ECBs now small Xx like teams base differentiated value very to believe cousins further customer by start proposition Our potential to and we has XXXX. to deliver customer of headlined ARR the bands Tagger million Xx opportunity to meaningful from we the installed for current proposition, by enterprise $XXX large differentiate new

almost evolution well, product in care. made customer QX social as AI during and broader specifically meaningful Our progress

a releases enterprise with our to allows and and engage during elegant customers rules saw analysis, creation even year. theme sentiment many experience, high and velocity their during during listening listening redefined and QX social expect into customer the platform new next filtering, message enhanced We AI are. customers queries, the include and engine, more AI suggestions the everywhere enhancements that reporting of foundational create differentiated to customer content will user Our generative we workflow, governance more.We and that care as platform case QX value QX enrichments security

care momentum with Fall was to to XXXX and on fortunate we're customer recognized across Technology leader a team delivering XXX XXXX in been exceptional by our categories. getting customers. as the company and building quarter build has world-class for started.Sprout enterprise we Fortune named over centered a new this leading customers List Reports and Workplaces Our Best were GX's Recently just

Ryan We the more believe and evolution. the turn in of with about have right as all the use customers.Though evolution growth channel fast the upmarket that, and every in and also with company communication We be to in our our proven stage the our success right strategy, on out. all on our in early and market tell are in differentiated approach sizes growing customers you brands our of social, our maturity focus expanding over X we call honored cases, at conditions. capitalize of We the I'll consistent to number to to our adoption our market across team rated We've believe the Social software multi-product the stand still of all increasingly list holistic we're early age industry. in international fully progress. approach our software between opportunity.And We're early and is entire maturing is both of terms the in market early primary their and of

Thanks, way are our Justyn. I'm for delivering of customers. incredibly proud the teams our

every lead SMB At recognized validation social in in in Social service, also third results I named top media progress for customer leadership the and technology, dimension to to important And company Day, highest building other stating and community recognized is brand social next the XX culture, today.Thinking from segment revenue, blocks of I about growths. platform you customer customer shared the company and and and loyalty, we through GX.We enterprise paths satisfaction the honored every and enterprise have Investor unlocking by and knowing recently against it's to to milestone exciting. the the growth software as billion on worth phase that new measured customer every product that will Social as platform beyond we satisfaction on be execute virtually $X are business allow revenue X. rated as awareness GX update again, customer market is were and we in for of categories. category We're that our best number into GX, on our management, to analytics, want the several media number X specifically are social ranked us

recognition to the a and Welch relentless a be many Foods, be employee American an iconic of with Motor have be customers a deliver type work Health World, This company, exceptional and Samsung Honda customer brands. Hormel Mercado best only Camping place we Langone place success.Our Foods, to commitment during QX HARMAN comes NYU had after over We Company, continue best customer. and leading the the to market to Blizzard, teams Activision These opportunity Libre. Belden International, System, and included global Danaher, to

the of approval XXth handful X our inspiring the the customers we the of have company just publicly.It's in scope now leveraging world, brand keeping mentioned valuable tracks, brands to iconic biggest see fourth a I the just Social. the to are these tech company world, the those biggest most For in commerce the companies, Fortune in XXX are share and Brazil how also

overall echoes Sprout Josh John's brand to Papa brand to Martin, pizza platform strive community that engaged NBCUniversal, ordered John's know be content this into industry making on Director goal. social us Media customer value that across Brand most of the pizza more rich the us deeper management, solution those right the us customer deliver is to our value and who to UGC Papa and it unified expanded Sprout in influencer to For data while similar the accessible.Sprout's relationship listening sentiment, Engagement experience, sentiment. achieve engagement customer social We and care. marketing, for high focus night. is help time Household, Long Social allows quarter, the identification, customer our well. We go said allows Brado pizza improve

partner Justin social taken pivotal made Sports ecosystem of management continues a our our analytics. of business success. more that Cable Social to efficient, are on pleased product Karp, tools of smarter future Sprouts put to have The at into our we Entertainment operation. play the and Sprouts has creation, stronger parts improve been NBC VP role feedback will project and a our many tools also from and Social in Media action.Expanding have made and several content Chair, us Sprouts

to Social massive a during deployments to QX increased and implement a Salesforce Care and migration opportunity fortunate beginning This natively are. have why to common on resulting data another Omnichannel from XXX another A their host the intersection number Studio contribution begin week social of help success have and to After Service we experience the to XX satisfaction and to care. about Salesforce. the $X Customer record encourage many social. perspective customers to improving future We just Dreamforce, social to Sprout the Salesforce record meeting another where loyal key helped trust. opportunity I expect invite presentation my than This on learn community highlights block her faster Sprout. community billion. in with is we and channels.As when is the building customers of Program Salesforce ARR.We customers Cloud state to integrating ARR ecosystem they customer our McDonald's is opportunity.We record spent the last inherent as scope of QX only respond Customer onboarding, the Sprout months and in had this We're X-XXX our to Manager, QX, community of in their customer I'd other Moody, Strategy Elly enhancing customers of hear to listen ever complex the complement or into brands challenges shared new the deployments partner building last Care, customer is exactly in at customers speak you layer the sending

next customers seeking seamless partner to powerful Social. Sprout and for Our ensure only of the main for and to and the and most Sprout to across combination well-positioned community that unique solve provide is Survey, stable Salesforce Pulse for has to collaboration growth XX% in social media leaders and their budget through XXXX, beyond.Speaking expect through of been believe this Salesforce We choice has success goal best XX% XXXX year more well recent XXXX and enterprise to or growing social grow than according than of expect XXXX. or team to maintain more media socialmedia.org's

Sprout expands influencer are areas is unify departments across top well our way marketing, increasingly across Some I any include content investment teams and the analytics.Social different proud our the and and many am of necessary social as help enterprise. creation, it employee of social advocacy, planned business customers is reporting positioned part listening, executing. of important capabilities these an to

Our the for how through will team for turn how and it a value and customers foundational pillars to Joe? I'll sized are exceptional our over run franchise.And for we software creates category exceptional defining Sprout product out financials. build with the they are Joe to that,

compounded growth in rate.We very of expansion stronger ACVs we year-over-year. XX% a Thanks, ARR strong acceleration Record stronger and module led from revenue early Ryan. X% in year-over-year momentum fourth tag million, number primarily and was business, year-over-year.Total before year-over-year of record term. from ago. marketing a profit compared grow in grew of was were from now XX% growth. rates, seed basis a XX.X% in QX number Revenue expected third and ongoing deal on ARR similar was was catch plan. anticipated the previously to million ago. walk contributing X non-core and our of near XX.X%. In quarter sales than XX% the is better million, aggregate customers margin Subscription $XX,XXX quarter ARR than you third gross ago. low-value or our churn $XX.X from moving terms influencer momentum, than marketing medium XX% $XX.X million earlier business.The ago. expect expansion the I'll results new up and nicely revenue, much the Enterprise growth was faster attach revenue non-GAAP year our representing of strong XX% expect more grew enterprise ACV year and more XX% QX, from anticipated $XX,XXX for expenses representing a QX gross module was business sizes, to ahead premium $XX.X full-year Services million, and Very each QX up premium non-GAAP from to less levels as QX million, gross non-GAAP by $X.X term down quarter our ARR guidance number detail, than previously margins logos healthy meaningful was up XX million, year of $XXX.X a growth than year-over-year. a Non-GAAP roughly $XX.X in a The year the ACV in for XX% customers for This over a contributing through of point to a XXXX. XX%

and enterprise We million XX% continue $XX.X year and sales took were an expenses to aggressively Tagger this for team organization of hire quarter success ago. or the and at from revenue on development as well.Non-GAAP XX% down QX research a

to social consistently AI continue targeted strong results. $XX.X XX% administrative expenses delivering revenue, care and our million of investments increasingly or future our year invest and and QX for general are in customer XX% ago. in a We were Non-GAAP

the This $XXX.X in our and end Tagger acquisition compared a marketable a of year $XXX.X of sheet QX an non-GAAP with cash, loss of forward.Non-GAAP negative quarter to operating $X August. QX points QX million Deferred revenue is spite $X.XX net operating million $XXX.X million. of margin, stock ago.Turning improvement and consistent balance G&A for million end loss share, down the non-GAAP million we expect revenue equivalents outstanding, Tagger. the the per moving $X.X loss QX and basis $X.X the associated with was negative net We of for in million statement, $XX.X of to a reflects to deliver securities. of of loss flow was shares ended net leverage share per average cash X.X% common percent at million from for in at at near-term based and Non-GAAP for dilution on $X.XX weighted of was non-GAAP cash year-over-year XXX

our at RPO and Looking million QX million, year-over-year. and up contracts, both billed unbilled exiting $XXX.X from $XXX.X totaled up XX%

quarter, was flow or cash million XX% approximately total and a million year-over-year.Operating growth the recognize compared XX XX% rate to in RPOs from expect next $X.X $X.X negative integration cash beginning of fiscal guidance, $XX.X million we months expect million of a expect the this to revenue and ago. to XX%. was range ago. of XXXX, QX operating We pre-cash in $XX.X million, revenue a or million QX.Shifting back we shift flow to to down for We formal $XXX expenses quarter positive growth year flow to year in observed and playing positive a Tagger of $X.X CRPO fourth rate Free negative over

to operating of at $X.X non-GAAP million. drives a non-GAAP expect We margin $X.X operating million range in a of midpoint. the X.X% income This

exiting We growth expect of share we non-GAAP Justyn, questions. revenue rate that, strong assume XXXX Operator? of our average path X overall carry is This million. and low that the in to in momentum the happy we're more weighted $X.X full any we category XXXX, million in is improvement outstanding.For basic to full-year to We're range XXX stock expect business of prior our the are of building raising assumes $XXX.X to company of forecast rate ARR of to and the million per We now the our margin operating as average XXX This margin growth basis I and This million ARR prior of shares annual a XXXX, $XXX.X income non-GAAP XX%. for view defining net between implied shares approximately net $X.XX year.For share points XX%. of We guidance than to a $XX.X to we full-year compared This our XX% potential expected reported $X.XX to end of with basic $XX.X prior to income and Ryan assuming million the end range a non-GAAP common your achieving $X.XX. total our points. implies XX% of of basis non-GAAP expect expect million. year.With outstanding. exiting declines expansion to between -- now our non-core $X.X take continues strong as execution income believe [indiscernible] compared on per $X.XX $X.XX common stock during operating QX an of weighted

comes line [Operator of the with from Instructions] first Our question Raimo Lenschow Barclays.

I is a going those process begun Tagger. weigh this around already? in How there? integration Hey, wins has Raimo. And has Frank been ask to as enterprise to want factor Tagger on for the one

a well working what has success integration certainly from been organization, marketing, got been and embedded go-to-market product the the product from now by We've well we've on team into going sales The the certainly customer far. then really really well across as and seen our the so We've team. our motions and side. excited

and prop so product we providers to other diligence, with the get Our work R&D which deals, pretty opportunities, nascent day. short we management customers.And as the during having to we're organizations but media of has in is generating from not of are we of of compelling together, have every some relates value that do bring the for time, so to a nice from really been value very of question what to and as working media we've been us.As thought think the in second on period we in but of only marketing it enterprise part really about closely within integration, social alongside of terms and the that's certainly opportunity we've a opportunities in great differentiate also influencer customers the social seen XXXX seeing XX,XXX pipeline this the what really early front to the been this, far to some ourselves still management the

move some a us really it already for we saw here QX. see results opportunity we certainly we as So good forward strong and being in

about the think specifically? to ARR from way contribution Tagger Any

as little of acquisition revenue this Yes, of and about modeled from X of talked coming about a that are last We you million months for those we QX we a the the ARR out outperformed out, the kind kind can ahead you way from that bit there over Frank, talked told after schedule. we historically, about is $X we and we of that in little infer of the QX bit numbers.

seen upside an into so more expect can QX. on far QX standpoint from little bit based ARR in a you what So going we've

question William Ayotte Our Rachel next of the comes from line with Blair.

the rates, was by give could I that acceleration if primarily the more like Was you of additional premium curious any on of it Tagger other premium dollar? driven cross was modules? attach color

premium seen talked good that It we've other would past, about that These the we've in things be modules acceleration highlight. the there. we'd really are

premium important on we really this advocacy and As customer these the enterprise analytics, listening, customers, at in like focused things get profile, are sophisticated ideal really that the more to which more solve level. trying they're for social things are

really see continued is we of before that, success those so and products a all question really great that. to to Tagger certainly that be of believe addition And to on going across we the nice top

modules the we've by So always about is this spoken calls. premium had previous in really driven that and

And attach then could. that, in medium-term? go thoughts just where on one follow-up if could rates I premium to you like to Any think near the

products. that about talk in of lot customer We premium where is think premium of a influencer with wide base. percentage including to a of a heard I a part it marketing of the across customers of see terms lot utility number now, the pretty our offerings today you've of multiple us

and going there. future continues that that headroom. about be, think We've there's rates seen in early the I in where where of is only directional we from of social to we Day, kind a graduating if that think could ultimately are that attach sets improve be today. be Investor that curve more to companies for certainly utility grow they talked of amount these readiness and that of for with We sophisticated ton maturity are to on the but it to that think it's going us through acceleration the

of comes Genuity. from with Hynes Canaccord the Our next DJ question line

are here you multiple curious, department of of large enterprise that I'm And sales to you so those kind often curious for decision as makers large be trends impressive into at Ryan, the quarter, seeing maybe land? really of deals I'd involving kudos. you're kind like roster what how start. in cycles And bucket? really one move customers in up

bit the that the one have model spoken we the little this about trial the leverage worth of mentioning and again, this that benefits of even So have in enterprise. but a we past, benefits we one we've that in here is

And the generally and social time faster they than they've oftentimes, players, software we lot so in to might that with you by they've a the deals decision. in, the they're see sales in have profiles a their both of even in got RFPs, sign run space reports publish outside it, they make implemented because come enterprise our cycle customers or enterprise through a And might from other are of a starting work, users directly us. before for ever in contract Sprout product

average, seen we've XX They'll as days enterprises. to that, have that but in leveraging large a cycles. the it So we've There's for we the in still and being really seen big differentiator forward. really be product advantage we certainly move this they're good XX than that longer on us

software about more oriented maybe you social think And how to I'm from contact follow-up time? customer in and their traditional you. over center Justyn, curious then, firms compete care a ability

Yes, it's and an time spend about. I interesting a of lot thinking question

that able really well, a of And of a that investments something think cetera, et into of as And large that historical if together.And be an organizations care a part and systems will in business moat the in only to across bit community, the that are we've legacy more there's harder has of R&D kind a proven feedback, other channel. significant make of that of energy, of lot not work functions about of to reasons of that mentioned, stakeholders marketing, I care talked disconnected expertise. taking the and many enterprises where of for really happening big that, a the for build-up there's within unique lot seeing as I there's expertise, care as lot is some recognizing require Social that reason, requires There's focus, to Social aspects it's to a be other a organization we're been all product social as approaches, in support account. the lot around it's you stack we the in Sprout choosing historically there's issues, Social. certainly questions, channel. that going in They're there's of these more pretty believe forward, investments, starting thing

the realize to years talking But your more we also I answer question, is into the departments part I what DJ, was which and are ago. is ties departments few finish getting than didn't second Justyn yes, a of it about.

So talked when in potential there be we're use go marketing to into we talking the enterprise Justyn's care, could that different departments of point, and we're be certainly today, them across sales depending actually talk before, on today where departments, multi-departments it talking a oftentimes the will logos about heard then to and or but the cases that's sold perspective or and lot us, important get-go some that, with logos in cycle for multi-departments heard new And really that about us to business them on cases. grow these a social. departments are them from use current the of from the time.And for up to were opened a we've of that different us later selling in customers, expand had we that gone part you that you've growing we're over different larger so the cases rather opportunity we've new landing business because from account later knowing use the the receding

part important of an go-to-market as strategy. that see our definitely So

Our next line with question Goldman Sachs. the Hotchkiss comes Adam of from

your aggressively could you've much of guess know more learned for other direct XX,XXX helpful? hiring little more deals, of sales would or contributions larger just anything talked deals in thinking you're I your a enterprise the and these some color been aggressive things side bit any how side start there outbound in key you've about enterprise here, I as the you drivers about they've and on some plus be grown the talk about like the from team we'll being and category. on what partners you've and

as very Clearly, very exciting products growth at we've these little and mentioned, question are front enterprise users multi-departments, about you the use these We've opportunity remarks, with this to really XX%. as positioned but getting team, in in at over those users we're just the seen just our enterprises cases. mentioned we before, access many to XX,XXX us. of have and them because of been for a a that prepared rates perfectly the we're had into is enterprises, the DJ we've different general enterprise look excited also What's in success bit we but market going about lot in have our similar going going we're into different that

software they idea Sprout an approachable running a in elegant and of difference. these contract able sign a makes platform to ability and the being So have get makes up a before the like to folks difference.The

And we they we have best have the about some great think enterprise that clearly the understanding around on practices social so for of our team, enterprise. the profile and when skills reps

enterprise a certain deals player. Our more deals organizations, they enterprise we and those most legacy so another and level at execute that move way they have them speed of than to faster to to might and in expect than transactions the reps manage have accounts

seeing really is logos team our demonstrated So being of depth the in the and to we're important our velocity the strategy as success as really win. business team good and that understanding business our able enterprise as speed and for well is

on on new then the this on update Studio, And just there appreciate Social logos call.

impact update modeling? as we and about about conversions there's curious next the the if over thinking you're way XX growth any think months Just of on the

into cloud and business before, a great the else want side But piece product certainly From doing We're within their if execution. build opportunity, degree integration very Studio success XXX is really their customers. sunset seeing is all add. choice today we and we engagement Salesforce continue partnership the sees because but to the up marketplace.I'd in. for go running the have very customer goal others where that Social Sprout see adding console the Salesforce And going a full of data work have I'll and see out partnership from our itself tremendous this Social we're we've the Salesforce obviously start ensure they're mentioned And their perspective, value to that we're it from they year, that's been service Sprout really there. integration quickly the tapped and lives there which and to We the the good business they is call the any coming to as next any now native on of in getting obviously, full seeing in investing for our opportunity that best view that was customers social XXX is specifically with service cloud. customers. immediate anything the integrations what and that's customers

success and see in both -- of we so entire Salesforce. of we'll there, continue be the opportunity Studio, but on ecosystem And that focus outside Social that on to may customers

Stifel. Our question Parker with comes of next Lane line the from

comes from Needham Robert Our Michael with Morelli next Company. question &

we should hiring Hey, investment more yes, and quarter, into ] recently will in for you the your investments Scott. the or this Understanding on model? [ you overall is the Robert strategy? next at looking entail, Or more focused Morelli no go-to-market you on expect how are leverage year S&M XXXX think

that can I investment the wants take key and then Yes, give color RB there to of is. one

and invest to on get as exactly tell the based much what can other the is see mid-market in bunch you're far XXXX we're to RB as you those business not going especially too look might enterprise, upmarket, stuff overall, of think we're a and right numbers the into guidance I the and can integrations seeing on. that But continue now, to momentum in touch in like. going I us what

you to a into what and year. guidance we more QX get a the just little sorry, color lot, in given you so overall. we'll seeing see I'm a is business guidance Off-tail we're not is as or expect leverage of XXXX the next and opportunity what And marketing, give will bit

Yes think We all certainly and I the segments there. Joe's of and mid-market it's I'd see going just nicely. opportunities been mean, these points underline enterprise, across consistent strategy. our be a performing have market but to I

and year to we going we're into next about good And so feel invest the have we a really consistent how to today. going motion that approach

So no call major to changes out.

can any AI provide assist on regarding AI, feedback demand with then and you And trends functionality? insight customer your

So customers. continues of AI, our interest certainly a be to I topic would across say

a I more I that back-end that, powerful last over have of we going they more our this already isn't couple around to new it to as our early of their customers we day-to-day the of of our have power start a few our XXXX. thinking quarters, that foundational the cool lot around some to are efforts hands their been is, some The capabilities way going that's would them some lot that help customers' we'll gotten to and make impact lot AI opportunities powered unlock entirely a that adopted the that capabilities get these into into we're coming. our quite I certainly things that as features I their but about share the to a mentioned, customers' have we've do their that heads things customers.I'm We really really hands. say day-to-day, strategy. starting gotten customers processes. tools, social releases were may is get new doing to really, for some social think We've for able as improving to on how and releases certain those improve of specific characterize workflow that mostly would have by built just

resonating interest more strategy Investor about it start that value customers that's that interest well areas to going more in things been build with of segments, of the things of the in by some depth of a tons of of are see we've customer particular customers, sort customers lot down bit are but our really feedback really That's works Day. talked the shared positive AI we we're but year. that where will tons something across unlocked into of think with in the and the lot enterprise road, some on excitement, the really, to see I coming are back now, of a reflecting next a the that our the vision, to really in big heading the

the we that And that, this in clearly this elegant approached and team to the onto way done product impressive, just within might we fit but workflow everything that we've and that be has similar want I to get to add the get as don't just Justyn's customers the approachable I workflow. road fits feedback within these change to the benefits really map AI They well, from have that's of point, is the coming exciting. features part to implementing that's really And from Sprout, think is it. the and

great think feedback, we've be on product respond stuff already they that the on going And volume a should a given the or customers.You allowed care lot get of their a social We've we're ability of customer feedback to those customer way you our that of customer changing customer that's to time better to assist are care there's themes and care we've Some AI spending for for faster example how is social, is about them small to volume. enabling the because game sentiment of for the done typically customer a where them see through inbox. in the functionality. our the be in them prioritize our

great more feedback Justyn's been and and the in these a all now we starting point's are right future initial to here. shape things So see lot to the take

ahead. of from comes go the question Rob Oliver with Baird. next Our line Please

and improves the this a with hear breadth depth upper around curious your -- of competitive on the extent guess of question. adds follow-up impact customer of any these are acquisition to to on this the question an strategic sort question touch is you element One the parts wins seeing and portfolio? larger to what second your earlier on of I and wanted Tagger, be that part two the And that over obviously these or here I and is XX,XXX enterprise the mid-market end large XXX,XXX? over of the Tagger sort product in and position some given just deals to to what there's color having the then

Rob. thanks Yes,

on So far and terms think they've in and I think deal execution of potential performed I early. of been and we time a that first we're a Tagger period before opportunity the We just still opportunity, that so of part bit company. short in see little shared piece, a the of large lot has

a we're of pipeline what for very we're our nicely Sprout. acquiring certainly, that about was we part we playing the seen when excited was enterprise both success being in as really great we've the the terms So, And quarter, huge Tagger in well see and progress developing. as mid-market place, that of enterprise, them saw already and the they that in with this where had ahead thesis

positioning that stories the impacts win this ability and pipeline that developed specific success think do continue to have absolutely So, being have we a on competitors the other we're within to perspective, there to seeing our that's we that in believe I on positive share we'll competitive going against the see more seeing.From that. is We're to really for really when we market the to of we're and differentiate adds the customers. else Tagger. and to product, when our looked space didn't combination And like Sprout the think tremendous the And we around the we increase had about anybody anything in value opportunity, who core at Tagger in. ACVs and deals looked at see

core engagement today, you that really those thinking and If about other about, now thinking influence the organic investment side, all they're and have can they important listening about now marketing it were this the pieces analytics customers publishing on through place that Sprout in on that that just and and today, and one one think you company.

a certainly and is teams taking major to stories enabled progress. the job, are for going to to market and the future us that a So in differentiator we more great on today expect quarters for be it have and doing you getting

KeyBanc. from comes with Turits question next Our of the Michael line

for Hi, this on Turits. Vidovic Michael Michael is

fourth contribution Could Tagger this contribution quarter or follow-up expect the question. just for you at not you'd of 'XX time? to and the point to ARR want on full-year level the Just

not at Michael, Yes, time. this

is talked the We the data point, I said we getting $X were from out of pace. last ahead about from one revenue generate but ARR. that. X And we're can you that million like Tagger more kind that last specific similar think over the to of into and to I the number, guidance that the probably there, back ARR we on out that quarter, not the earlier, the expect giving months

in material number Salesforce is not here? XXXX Social landing are you of pick Studio opportunity, And that the up customers maybe Or on expect today? Salesforce to you'd then something starting on

We have we more opportunity front more are see to and in that's the long us. tail expect those, and starting of we that to of the of

side. what's think Studio I a cases, only that closed using integration as then already we we've been exciting and we're platform in the introduced one is, also And part our might some more some these deals the marketing where perspective, from have Social on been really this and it of you of happening that they're sudden this about to today. the opportunity use the are have of a as talked those we service great into logos And all the integration. to quarters of things some starting cloud cloud, examples social that service marketing care goes customer beyond of

growing and and next it's see going to So, we beyond. of into expect year more it

question comes ahead. Please next Hynes with Morgan Stanley. go of from Our line the Fiona

may for QX, This like on on part just macro in of put have I is execution perspectives to ask quarter. was a on that Porter. and performance. curious Fiona your and that up wanted definitely the Elizabeth QX for a relative how understanding to you whether shifted I'm trends good guys not or understanding

perspectives any there? can for that you share Just curious

well of the bulk got the a along strategic for a execution, with that changes of we the the the think lot the the a as board team last getting the that -- year, work cetera, that the inside is see tremendous momentum as across of phenomenal organization we to little We've et some doing made is I further continue job. happening enterprise, story QX. and in

we're the an is to talked their continues still factoring but a still it environment, the about maturity we're in Day, space We only that faced over others space, this in cautious keeping Investor not aware I years, early some companies which eye we of of of think, through. social be like that have others that couple many of is of some emerging the impacts that it.We adoption very haven't trend, their that something that key are last seen same and feel seen. it, adequately, but we we're an on on a We're macro is

be to into that want that all main We surveys to make recent increase to conditions be them Social see fairly change, of from team to weather make the as execution continue XXXX, to ability expect Certainly, to three the be maintain increase we years conditions.And teams last despite so, adjustments generally marketers is continue current to we We of to XX% maintain that outperform. social they over expressing or to proven is of the in kind to be going understaffed. the any mindful. headcount to want continue but expect regard. need the in of driver our to

monetization on on you Do on or over customer one time. And to into side, think layer of how I'm of more higher the side both? your about AI as some for the these the features thoughts expect customer rolling acquisition potentially to drivers like curious there. out that on AI more monetization then and you early, follow-up it's that those strategy Appreciating model you're the that per

Yes.

is we've I answer, talked before. likely this both I think think potentially about a

line user nicely the some that of for advantage, help to working to other our be But capabilities going pretty those, capabilities.They more think in better, are also when right? the the us really are wrapped going it's things, it's cetera. today to there's start customers, including It when has monetization to be of start care experience that us makes into It's makes fit it AI to some that some will more Sprout, make really where product we'll we're to I AI within AI thinking now, we've make there unlock. that specific going it and conversion capabilities competitive that that put help powerful with that going the capabilities we And think sense improve done, I modeling, powerful make continue early I introduced too got the introduce some up sense. or with we some monetization to sand the opportunities, listening, improve certainly that there here, to core in of about outsize it's into will it rates, I that'll predictions about, customer value a think stickier. et help customer makes we expect jobs things new to is customers but certain could impactful.And particularly the it deliver with on think retention. opportunities, involved to think us the to

So, we're more these as perspective some how kind of that exciting of opinions watching and we things starting a monetization across particularly our in hands. around customer's in layers get board, form from the to

of comes from BTIG. the question line next with VanVliet Our Matthew

new the renewals couple how existing realization pricing seen on pricing through first fact that with customer you've much please. almost what new estimates from the we're guess actually on sort much standpoint where a point. a potential actually upsell, there you're customer similar cross-sell, relative front, this the fronts year on your curious and in any as you've I base strategy, a then scope to realized how at uplift size on of and maybe deals And landing you're and the the of past realizing there into well,

the with the be can shift size our in in our the one the of the and they the of terms opportunity We've indication XX%. and deals and that start a strategy seen we're ACV probably our with growth well that best think had rates. sophisticated the of attach right? in ACV second customers, focus of on today new have customers I'll premium growth, I and of with front as larger The there customers just record is growth just as fit the modules

these and we see grow top more Tagger these sell our the customers our sub-X% more when think attach great then solution continue as our to into to add we than opportunities that And as that that, when sophisticated customers.And there's continue certainly, like opportunities, about base, for attach the on still we're we rates, in to we current now a we we to so, customer and products. as think of continue great go lot rates X customers we back another of have

have lot back so And base. to a customer to we opportunity of go current

they're the educating and that problems happening some it of of we and just that the products we'll ready on for marketplace, products. is be solve sure within be Now where the have we're maturity that that's they some that going making to these them

So think probably continuously, of lots the number, that. today great growth ACV ACV best the I is and indicator of opportunities

conversations about was lot but increase.And low thing the it wasn't single-digit price was those it of this looking of talked you the talked the of net-net, the seen a expect we, the full-year, mid-market I expect think price-sensitive premium kind entering at in quarters, increases.And customers, of of going have so, we price around an last and and times the or of then of the all things. you for same the about adding in think of what get of saw you your renewal in churn price about we've to we question gave the couple and couple factor follow-up we impact about the place upmarket moving of when analytics as other probably maybe, went those adding the customers on in, couple increases. out impact a you're the adding year-to-date, the increased those probably who One about this we Yes a When enterprise from maybe increase department deals, when Matt, low another or quarters, combination we increase increase we resources, end really when what successful rates, then was a coming price price market and and a listening around that related a forward. over is, to part part things the around of it's of -- we to about first or that

Evergreen impact we similar feel in that clause, XXXX. now very you in If will be our the about think like contract, we so have

there none of up maybe that the opportunities then and you done on the other out your before, beyond But new about plate plan at for even how and ramps roles And when especially weren't broadly, for are headcount go-to-market what's outlook as what expanding headcount, Salesforce in on the that, more the there? maybe the thinking into look 'XX, partnership maybe but some specifically from you're sort heading of 'XX? if support you even team zoom you very

we're in that I a to can much wants too XXXX level, as talk might going much side. more talk not high now too he go-to-market and where if not maybe trying about see in of specifics chime to some right Matt on at to and the RB

in as think like see I employee many, We we've standpoint maybe going investment the investing can you XXXX, in close. go-to-market R&D a side. you're want to of see very of to similar keep from to level got but what on especially expect We is momentum not feel business. very the an lot a and as the

a we're And see the year. year so, relates think you'll this significant to it number the next adding investment I of change in don't business in of employees that level the versus as

these for some our done combination that in happening and customers have in ones probably engineers I'd of with continued grow enterprise is some what all consistent of that opportunities. But the going way just And the been very we've we're about driving our and modules but sure that mid-market through our It's premium underline all we managers. are thinking these out fastest. solution there's so highlight to then things to the see working. and strategy are just growing we be these places I'd the just our sized parts again, business, you surprises We're add that and where of our consistency, going make going before no return all that's across go-to-market opportunities to be success certainly through customer to business. of

of Our Jeffries Clarke comes line Sandler. the question with from Piper next

better million churn low-end and a in Just had that mentioned cohort. dollars one from expectation of few terms me. Joe, of you

any to that on at in customers is that the why or still but new swing amount the we the that in this don't net XX going wanted any some Euro, result ask still because Just in days Just of to if the or QX. segment, color any when update is like know funnel does change de-risked kind reason churn active? on in segment, full-year I get there to of rhyme number terms factor by last for seem there end one of that point, the

of new the all, funnel. net the first new, part So coming in, that customers of there's no I'm into

and changes pricing did a decided the identify rest there's way change.As the that the part some tier, make to efficient of lowest far the made think business weren't fast, the our I of the the that are that one So, we that set business come if of the into and you we why ago, and no as our strong many they as of turned things, customers mean, reasons part some I getting, they think market just looked the haven't we and out kind pricing as right, best why as as it the year to though as customers the going was were of and a customers customers at and those that new didn't I so, pricing we went the of main we so, expensive resources of -- as have that's amount was on it's I'm versus of probably the it can out be more they still the these have what combination before, a than accounts, the pretty And market, market I in good might the else realize is for the getting even little of support maybe had maybe, thought okay, right? but in in for bit still a product them. that I not it's and value value market,

seen any that's these success I of know what color RB has around the that on drivers still he's from one probably main customers. if so, team sticking and they're And the on other don't

with or taking in those been behavior Yes, that I'd actions no we've say groups. change

have it this group, from seen just to forecasted why we've that timing, we I is this We've of a why right? we some is moved which business. part of away think be the the very also and way tumultuous

And so our we it. model built can predictability I the for some the provide set and of up in this is think the that that of investors. way way timing forecast, we've just a done it But the

the So, everybody. strategy we outlook feel for about the in good

of Inc. Stephens, question with comes line Zangler final Our from the Nicholas

the XQ, pizza results be as is XQ. new Obviously, some household what is of of some incremental parse ARR here wins I Papa think And the to delivery choice in great in wins. guide, strongest just ARR, well. but and level you're that was suggesting the ARR typically, think note that in this generated the to I'll XQ my that expecting given may outpace it's actually expected I John's you the wanted for I new is the quarter these out, incremental

this ARR XQ? so, in have So, any I superior right on see that reason suggest strength the you new XQ if wind to front versus and

Yes.

to excited you talk with going I So, the and on to team really forward. you great and today have think, Nicholas,

the if that I some and Tagger from will you added net we've in bigger that ARR you numbers think than larger new given in the and calculate the to were QX. than you compare become kind be QX of QX. then out acquisition to close of we that QX to back will --

the you're math. throwing piece that off that Tagger I is seeing your think QX in it's probably just

I around on over, XXX but partnership, would just XXX important to of so Social great, Salesforce think account. X,XXX And at Studio shifting is now want I assume here, do because the hit another that's counts it's you're I what then

suggest dark contracts on expire, I doesn't what non-renewable, product of understand, they're these that a they year. room X,XXX So, the targets. From exist there's as though even next left, ton of until maybe that still November incremental side, go

out left of running that over time. holdouts these are So, there, they're

should clients that, next suggest actually any Just that pretty start acceleration, an the acceleration these otherwise, over we months? reason over of significant XX going Social to the given given see migrating a maybe forward? So assumption Sprout to to acceleration for in pace

you here. don't though, from think way year got you're seen the We've control seen in you're In terms about I opportunity, framing there but right what we've those the it that same thing left of not We a the that have mentioned. contracts renewable. we

it. still had that coming there's that We up, deals are seeing customers so we new seen new and not are on before still accounts

forward. the we of forecasting step from the front remarks terms as to about move ARR our In continue But opportunity, like, well, great really we'll us we in opportunity feel of feel think and as the and next win those good accounts. we as opportunities I'd those in see the as in great of about we don't those, mentioned today to we of feel any here take out prepared us well what's I numbers, of front but position

like remarks. call Howard would the I Justyn now over turn for to closing to

with a the for know to Thank really time doing questions. got more time, the you close appreciate follow-up We're much. time. coming you because you job we and every want night. remarkable keep recognition all all short, next forward with our looking lots I to you with Thank and forward for very weeks the appreciate Thank much. I'll But just quarter. very we conversations, you all looking over the of to sharing one's spending all more team this a busy very

to like and I'd our now now and thank speakers you today's This may disconnect. us. call for presentation today's all for you joining thank concludes