Concentrix (CNXC) 29 Sep 222022 Q3 Earnings call transcript

Good day and thank you for standing by. Welcome to the Concentrix Fiscal Third Quarter 2022 Financial Results Conference Call. At this time, all participants are in listen-only mode. After the speakers' presentation, there'll be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. to Stein, conference Relations. Vice like speaker to now David today, President would hand over the your I of Investor go ahead. Please

and and Then, will results cover nature, Chief summary future will third that, the of are statements financial expected Concentrix the Please our matters Officer; and Thank the non-GAAP additional our our to This uncertain. Valentine, EBITDA Concentrix adjusted than provide call, may of non-GAAP contains our Caldwell, not result measures for risk address call. currency constant Investor actual we good forward-looking reconciliation We to and information EPS, and Relations affect or your open and website and and release by these Chris measures, of available call well future growth our business A call quarter rebroadcast performance refer for discuss future These forward-looking of provided cash annual me and Concentrix. our recorded report Concentrix in recent includes call non-GAAP adjusted our do of the without Financial call results expressed This statements. is on property could during Financials. developments. you, a as new our cause questions. earnings under Form permission will Executive are results. a financial Officer. outlook. the financial yesterday's with regarding strategy, to operating free as earnings Chief fiscal information adjusted Chris the be performance that including we’ll may the the Andre different operating forward-looking morning. on is With the most our their address our release income, President XX-K. be flow, on and XXXX today update that SEC written statements our those or materially Also factors not Elizabeth, that the future as news and uncertainties Welcome revenue This growth. uncertainties filings to undertake or in Andre in events

the call I'll turn to over Chris. Now,

very everyone, our quarter earnings morning, and much, David. XXXX. you for Thank fiscal Good to third welcome call

several to of First, job. I'd have And extreme safe our our last like thoughts on outstanding weeks. staff our with for our out focus to do send regions teams an our over weather and dealt to continue delivering they continue few to keeping clients, who the

discuss retain through and address times customers offering positions results, digging before into need challenges with dynamics the our Now, generation, macro ensuring to believe experience. like current more and best our want our I these, us do environment. revenue changing In less these with the automation possible address persistent work clients by as holistically. clients customer We experiences they uniquely to operational to of needs in to economy disruptive some the and our drive differentiated

seeing weakness their are achieve economic challenging business can and their with roll by a work optimistic be good in our them who our times in have well consolidating objectives. clients helping we Our I we strong, long-term more Historically, and pipeline we're new for business, to done clients that remain meet both continues helping us. goals. financial

of our in of being of the success all actions. flexible, clients and values our culture tenacious Our thinking

was headwind. higher-than-anticipated constant in XX.X%, and profit by organic including We quarter constant solid improvements On revenue and increased the our line Now to currency in executed continuing X.X%. a guide. billion, turning to currency quarter, revenue Reported XX.X% third revenue exchange foreign $X.XX our with quarter up growth well a was the in deliver basis, third results.

million, growing $XXX Our to improved third income million adjusted with XX% quarter EBITDA year. increased $XXX last XX% and to compared non-GAAP operating

share year. growth increased per in per with compared non-GAAP verticals the $X.XX per share XX% saw Our despite third $X.XX macro across We to environment. in all challenges the share last quarter earnings our strategic

issues on softer compared volumes of the in our growth to in from supply few Continued revenue clients weighed year our verticals. a earlier and chain in certain somewhat

made Our the new grew economy quarter. nearly quarter. positive Revenue the year-over-year clients million economy a impact very new in to XX% clients in from $XXX

I'm last We particularly of closing portfolio over deals significant both our for opportunities we new clients, are the and verticals continue of our benefit economy from has term. largest terms process, that sizable XXX the year-long Since rigorous, and excited nearly company entire where multistage, across the breadth peers. Catalyst Fortune A seeing deal to in signed several in business over medium that a growth our geography. its and earnings history. call, Catalyst leading won we long signed ever launched

the that services strategy, importance in in As few digital-first will transformation competitive of of their the XXXX. experience. through a next their partner, key digital digital strategic the revenue now we offer will Catalyst co-creating and starting The significant years enable we QX drive future underscores the entire win can for of

transform revenue we and to This of and transformation multi-shore have us new cost drive commitment as primary is client project the a This expected experience, customer generate their Concentrix variable. to making of next with selected a structure client's a is company experience years. insurance process, significant vertical, of hundreds a win leverage is more was millions turning highly After scale, of better an competitive partner. analytics This a Fortune to top-tier our a XXX technology project footprint, extensive signed our five CX Additionally, to a an while their dollars with capabilities. BFSI our again, to transformation example over client in agreement meaningful in company. automation, new outsourcing customer

end-to-end the business As sets that in and digital recent value these apart demonstrate, unique proposition model marketplace mission-critical two keep provides our large us wins CX services our resilient.

retail of trend The logos. consolidation towards growth share our accounts. scale dozen client wins technology, clients include the range signed new banking/financial we healthcare. Examples over vendor also to a new enable also of During our quarter, and services, continues in X in

ground BXB with and world-class our close. completed we capabilities the running During also go-to-market structure the quickly of hit sales to ServiceSource within Organizational brand. days integrating the welcomed and quarter,

have confident very meaningful our synergies. alignment that with we'll and new cultural aggregate we revenue driving the strong one BXB synergy exceed team, while are and year We cost target

identified the first exceed expectation year have a and have opportunities to than We million pipeline transaction, first sales more $XX an started set the as synergy target. joint synergies to that we we develop our believe actions needed we announced achieve will of year when we that in

single-source us would an run the and and of and is be to relationships. these investments. third From staffing CX to Our remain making the perspective, future had and of value opportunities continue the adding exceptional $XXX levels. strategy pipeline attainment metrics for partner in increased to our million participate build we that team Catalyst, capabilities a record to At to best invest been headway. in not capabilities continue have better of being than focused without combining than strategic deliver pre-pandemic these clients Concentrix to of operator able with We operating allow the service value we scores client end design, on operation, that we integrator of our more that quarter, BXB

technical challenge. terms hiring meet of Catalyst new staffing demands to In talent, remains a

Rica. including of Poland our development Costa global new talent expand take footprint advantage We are our in pools and to capability, working to

satisfaction Our positive. customer to innovation employee us journey extends internal be and customer for with highly This scores to innovating rate continue our Clients technology. the also operations.

provide CX, CX, become. Recruit Quality our additional stickier to we and internally platforms, During developed CX more relationships developed the unlock further Connect technology launched The services quarter, the we margin our clients, expansion. technology-infused to

margin While progress we on and to in America and increased quarter. pricing we some to down progression in third evidenced our the good by costs. elevated inflation, wage continue North This linked experience to to of make automation drive parts Europe, is our continue particularly wages healthy

of now. home, with At work of to saw manage transitions best we staff feel some that of at shifts XX% staff our terms home staff works we end the the quarter these quarter, back our and the from the of in mind. clients both in our our and of third sites interest about In

to continued an for $X.XX dividend prospects stock continued balance share. our paid investors million ServiceSource commitment through by and free an the translates third of and at through In disciplined quarter, raise balanced dividends pleased per quarterly generation to dividend in Our we cash our quarterly XX%. $XXX to with to average per annualized This are price on cash continue flow, deployment increased In and to stock capital allocation. we share returning our the cash $XX to approach strong of basis. of about while Consistent strong dividends we its allowed demonstrated our acquisition the accretive $XX quarter, us million approximately capital repurchases. repurchased

we everything client pursue market. emerging will guide, and and our deepening our We're beginning continue see we As to superior close wins, into out XXXX for strategic achieving our while fiscal focused guidance and we will shareholders. to transforming you markets, drive our relationship and year can year new acquisitions we on the that with CX for clients at we of faster we're by laid In grow selectively innovating summary, our customers. new with relentlessly the solutions our returns from than believe our the believe we the expanding

Board our our Andre. thank their commitment clients I'd execution, and turn trust and to exceptional With their talented to Andre? their Directors of mentorship. for like that, Finally, for over it staff I'll support our for to

an currency weakening with financial on impact for in the the in solid the strong hello, outlook Well, The impressive and Chris, pound, and margin X.X% euro, and generation includes thank reflects everyone. improvement and during growth, you, dollar quarter. cash quarter was the Japanese yen This our third fourth $X.XX quarter. look Australian up of from negative Revenue the third results quarter quarter. the fluctuations. improvement further our billion, at I'll We revenue third impact a for British foreign delivered the then basis. the business the reported discuss XX.X% higher-than-expected as-reported revenue the a in currency begin

the currencies increases approximately XX% retail, was the reminder, once verticals basis, the X.X%. the Revenue U.S. healthcare in currency in increased with is quarter. growing grew a and revenue On constant growth vertical. XX%. travel again way, clients Adjusted denominated our of dollar. e-commerce approximately revenue As our X/X in across than of led by organic a all Revenue other percentage third

strategic Our by contribution on technology X% by growth with media quarter, financial client vertical four grew XX%. insurance that Once again, each Revenue the in of of the our grew consumer in verticals XX% organic and Catalyst driven acquisition. constant from quarter. currency basis and services or clients an of grew grew and more the all Communications by revenues electronics banking, the XX%.

diverse The economy of new nature and economy Our revenue. clients vertical growth XX% remains year-over-year XX% of and third of of strong perspective a business. from geographic a generated our represented strength new our quarter clients

in approximate impacting our discussed in in be additional year-over-year call, to continued quarter earlier revenue second by initially programs QX completion quarter the earlier related moved headwind headwind As in we X-point to third An quarter organic earnings programs the of COVID-specific offshore than XXXX year-over-year growth that was in of impacted third expected. growth an our our the XXXX.

expectations, similar in did While to year-over-year the X-point revenue XXXX. quarter a continue impact our have to of it the this through third a in fourth headwind quarter and was will amount included

the to operating with $XXX last million in $XXX was income Turning million compared quarter profitability. year. Non-GAAP third

million year. up the margin Adjusted XX% last Our quarter XX%, last with XXX from $XXX compared points non-GAAP basis million $XXX in of third quarter year. was the in EBITDA was operating third

and and in XXX flow-through EBITDA profit new million ramps reflects compared the adjusted compared million offset XX.X%, XXXX year. million per contributions third was and on This increased revenue expense. last clients, amortization by basis intangibles, integration, were last with on of margin expenses GAAP third to in Earnings of from Our $XX $XX related investment $XX pricing, a year. existing program $XXX million Catalyst, net included margin inflation. new $X.XX $X.XX compensation was to income and basis results Non-GAAP non-GAAP $XXX impressive quarter the of in growth share-based XX.X% points acquisition of of million last productivity year. and quarter improvements from wage third with progress up share quarter for partially the

rates was Our rate to our our income. XX% geographic the of a in rate third and mix due were These the tax was higher, GAAP bit tax quarter, primarily non-GAAP XX%. tax

XX%. We GAAP tax non-GAAP expect approximate year our full to and rate

flow. cash to Turning

were quarter of totaled million, third Our million. $XXX expenditures free cash from operations cash $XX This $XXX capital in flow resulted the in million quarter. flow and

in integration and flow of ServiceSource transaction cash quarter. Our the to included acquisition impacting the expenditures $XX free costs million related cash

cash For transaction year. to to bit million year by will increase be be free non-GAAP of acquisitions of primary free the approximate cash full year, long-term expenses we This now integration last reason target flow of and shy variance. our $XXX a expect will net Cash to this over for XX% about our income. the related this flow

At balance debt end outstanding sheet. quarter, cash and third were and Net to the of the total the was end the $XXX the Moving at billion quarter. of cash million billion. was $X.X $X.X debt equivalents third

capital of terms maintained approach, in debt In the investing deployment, balanced through repayment. M&A capital return, our business including we and

dividend fourth During $XX as XXX,XXX of in share We quarterly per Chris Board quarter. the $XXX of $X.XX of quarter third dividend future. the during increase the per approximately And our to be in our average quarter, mentioned, third $X.XXX in has the confidence per This to at Repurchases quarterly price quarter. raised reflects share. our an we approximately for paid quarterly and a paid the to dividend our strength were million share. financial repurchased stock our shares made our

the on repurchase of our of share we had remaining million the authorization. As $XXX end quarter,

We net cash four basis. quarter, end the quarters of trailing leverage EBITDA, spent $XXX approximately was quarter, on X.Xx ServiceSource X.Xx a of net gross leverage adjusted to the third At the and approximately forma pro during was also acquire million acquired.

at net additional the continue committed forma Xx to end we time reduce any As M&A. EBITDA the the adjusted we can that PK of we under to barring of the acquisition, pro by year, believe leverage our

important share repurchase of our goal, ServiceSource. and this notwithstanding activity We achieve acquisition expect our to

provides including remains strong $X.X on billion, financial cash for flexibility liquidity billion which than significant of additional Our credit, the future. and $X more capacity on undrawn our at AR line the hand our securitization,

Now, for I'll discuss our business the outlook fourth quarter.

in We currency believe we modified business. release, underlying mentioned have constant the growth clearer this we discrete guidance given provides U.S. slightly with investors rates rather to exchange on the our earnings rate view of approach significant to values. revenue As the of focus our a volatility, than performance dollar

constant revenue year-over-year an For we the currency organic current fourth expect approximate rates, growth exchange approximately the fourth quarter, to X-point expect we headwind quarter. on Based in X%. also

contribution XXXX. businesses acquired expect fiscal in the also $XXX from million We revenue since beginning of

approximately XXX year. Our quarter the exceeding non-GAAP an profitability to fourth points non-GAAP increase XX%, over million. a $XXX income margin This the expectations for of equates include operating income basis of prior operating

be rate expectations in XX.X share of XXXX. year-over-year expense XXXX interest quarter, approximately on current rates, expect We to headwind million shares. XX% and million, Based reported to revenues growth the $XX with the approximately a tax the these on an fourth we average expect to year X-point expect effective XX% quarter fourth approximately weighted diluted X%. include for approximately count currency Based also our this we exchange for organic revenue revenue full an on constant of to of be

million $XXX net mid-XXXX. businesses businesses expect of in acquired impact of in revenues the divested contribution of net a We from

expectations XX include equates point operating margin operating basis million. of a non-GAAP to over approximately profitability year This non-GAAP XXXX. $XXX XX%, full Our improvement income exceeding

full expect share average to of approximately expense be an interest count million shares. effective approximately a approximately rate XX.X We XX% tax million, year weighted of and diluted $XX

had growth business another outlook any acquisitions. Our of costs In strong from cycles. and the currency solid impacts margin not fluctuations. our transaction through impacts keep customer future include closing, performance business resilient not offerings business or expansion. and experience We associated will are acquisition-related included with our guidance does we Also foreign with in integration unique believe quarter revenue future impressive

includes the free Day flow of cash unchanged. vision margin that, leading year strong Investor the ability this questions. generation consolidator the the Elizabeth, This With in with a presented deleveraging earlier through be to strong meaningful at open growth space, faster-than-market Our expansion, sheet. XXXX and is future business the for line for balance our our please

Instructions] the Vincent [Operator with of comes question Our line from first Research. Colicchio Barrington

number if Yes, quarter. the I've -- got right, nice growth the in sequential Chris, in X% QX? gives confidence you What

So with new into account And supply seen time into a our sort the of Vince, what ramp. lot XX perspective through portfolio, obviously days from spent we've they'll all taken what wins chain our working of a quarter. I software volume of and we from clearly, at from We've clients. time seeing mean, we're

confident that's land of very to we're going the QX. we're where that rest So for

you're consolidation, It was environment. vendor good slowing some you'd there's to see hear some of to like challenging cycles? a seeing in that the things sales any Curious, if in been

is won. we but elongated slowing size they that have longer, no are larger been out real we are. for there's deals deal the noticed always of that two cycles. some What coming clearly aren't take Those No, market. actually sales to they We deals that the called in

traditional the cycle, are same for The in of same deals be deals the cycle. So in are sales going longer, deals. that those coming consolidation a again, deals to larger sales bit through timelines are of types traditional tend sort but traditional

market the strong. see stable pipeline for perspective, a feels deal from and perspective we relatively So honestly, quite and a

increase due And seeing to to are willingness cost the meaningful in a more you pressures? outsource work

Yes.

We prospective clients seen clearly, existing more their of then the is needs to to still work conversations of of around historically as And that to not reduced come new companies news who it, make pick and to are of being That that, done, ourselves -- still more be done. that have done in model some how to a cost will force. up their providers clients get number seeing well you've variables. as clients but having work all some like of

still and continuing those of generation come couple number quarters discussions lead sales our discussions. a for we so on that certainly, of a And from see

in back queue. go I'll And one last the one and

But exposure that mentioned is impressive overall, would Curious how new much. you're the meaningful exposure. performance. there, to companies there's suppose, there's are if any you I very Your on had financing? economy reliant diversified not base, client

Yes. raise to new not do that to But group, In a We a It's continue portfolio, meaningful, have it's funds. economy Vince. as few revenue very who nothing. percentage our little. in our -- need it's clients not of

Bhattacharya [Operator line Instructions] of comes Ruplu the next from of Bank America. question Our with

the clients maybe talked mean clients. quarters, new I question, just said think growth think on back XX% revenue go follow first range. couple year-on-year rates quarter. I Chris, the guess, you've was what the about you the I'll I on economy I My in the from economy question if of more is up in XX% new last about I historically grew

mean, you is prior any should in weakness seems quarters? How that think mean, that I incremental growth? a from strong XX% decel Yes, that? see not growth. not did So saying it we it's just growth, but I about I'm significant

Ruplu, space is while, back more of because of sort we've XXs thinking is volumes, seen in Primarily that in you've Yes, correct. that a of a part for about are was around kind spending elevated. customers deceleration. bit of own lower it. things talking the One, two And you There a been of that on their that. that occurred cut

what aggressiveness more little of space, markets just is in being also ramping done. a think net also we're of cautiously terms into seeing, new that in I

expected flow. saw And portfolio we definitely happy robust of provides sort so things of quarter of the sort of we some and new expect that not clients to and economy third going clients still we're got revenue different above the American of into coming the that that with which the you've But are quarter. North of some our super very diversification we because the based, clients and remember, we fourth new into average, our from regions those be chunk a to be had still economy growth, corporate

talked of accelerated? And full offshore? some last their Okay. $XX because hit million guided seeing year. right? Has to Have customers you maybe you quarter, just on that wanted And about wanting more trend your forward think who for seen of the mean, I thoughts move you revenue that -- are forward? macro the offshore, going to Chris, seeing I you pull customers

actually, believe, call I I'll brought Ruplu, revenue do. think, quarter, question. the second forward, That to was I offshoring great in Yes. it, we our

onshore the may because in have we is started sped As shore should a of new majority but reasons. coming we a whether seen into right of is that specific the be at probably right client, sort of really, what for case that should and offshore for security the whether we've it's And the there of that delivered originally, And COVID. so the started from deals And for or sort it reason, that whatever brand are onshore work promise a work they onshore the ratios reminder, subsequently the regulations, that it's from time primarily do vast is be. up. the

sort So portfolio deliver additional to we no in That encapsulated seen their QX where our timeframe. from. in thinking change people we in effectively business, are have how work our of of

it's more a existing you then for about couple details? said some wins business. large Okay. Can give then had? new these this? us you you with the these for deals. you But customers new customers? one And Andre. have Maybe talked what more with you, And Are is Catalyst two and these type I of from work are Or

that are should more I involved, I'm are assuming how contracts And more contracts? more these years say And and higher, it's these in-depth these how work? are large involved how many for. it, So more

be details helpful. you provide So can any would

sure. Yes, for

this. rigorous. only win. IT around but this are Catalyst of digital many capabilities, to brought this sort the only it And looking are ability were of became out we scale, process, other driving out development, of XX incumbent for. driving very digital client months, come them. expertise, client. which consider we large, work approximately was Fortune cleanup at for down lot really sort The get we that almost, went providers of had. of in, So was nine They that months for partners. people what took they And were partner to kind at for objective their who existing to are start large, tech we incumbents, to and or two of one objective stacks or It on is technology execution. play. other client of it were of it's a in if sort application win is more gosh, looking smaller, Their strategic based support their one to key we've deal looking The building millions consolidation looking new of incredibly client Catalyst better automation the XX strategic their of one taking a of. end-to-end stack, and more deal, to transformation application the at a tens and the not is exhaustive management so security, signed large went strategy partners application and two within through client in for off firm. XX them, was The an also up companies, win of and over you were who with sort self-service or including of the XXX out one incredibly, we And them that the dollars, let's significant, And significant We multiyear like a

extremely, So Very transformation that. significant a for about capabilities, happy extremely digital of best-in-class win us. technical, sort

making come won within was is more client only not a our to last It us. business business is It and months business. variable basically since who a at the to process drive is operations of there call, that cost different as looking earnings other The work our component well of rebadge of will for shoring drive to client it, element their a a into also and but new many technology transformation -- the a more as traditional is business. It client sort some their of into because business. we looking automation, analytics driving be they're at

going clearly, prime up you of their footprint. is to and millions worth and extend of global also five picked like partner, our were we two so some that It on next firm. building the we'd five what's color provides of And dollars work we'll for hundreds hundreds that, past Hopefully, a the XXX Fortune over some then out it And but years. over those be transformation years. rebadging as million and of And dollars opportunities. next it's obviously on the signed is

the as it Andre, about it Yes. looks couple like XX% guide year fiscal margin. well. you It I all implies for a Thanks have margin, for looks questions operating there, Chris. for detail like from of operating the

As we talk environment. you like drivers margin for tailwinds you if think growth from are And you of margin the of the can there are Maybe for about that about think some do talk you that what more pricing moving forward, then improvement? part see headwinds there? or that, can as about

I that you're of terms pricing. drive trying in pricing think the said mechanism you've in better outcomes-based a past to more

progress So think tailwinds how on of just over your just couple margins the and that? are the for And headwinds should we about quarters? what next

we margin Good Yes, to so feel about talk really Ruplu. driven to Sure. great you, the expansion we've this year.

year points year guide year. You're right, guide, fourth basis XX from is the The full the up we're in quarter. full XX% for at XX% last

Investor our that remember to is that margin You'll up XX.X%. we've XXXX goal Day, indicated move for our from to

margins But the whether value at Certainly, we to all of more perspective. internally us over as this going quality our levers and things XXXX. Certainly, we're space, up. can or from that productive increase as do certainly, still that complexity, to tech, think technology, are you are that point. introduce of of time. Recruit CX move ability complex the because also way. we that introduction doing in think what the here for the in the target opportunities a the to the particularly can be for we continue that the Catalyst there margin provide tool we So to about going update talked do that think with the about, is drive not We're to still more we two Chris CX some do do in things, target work pull margins transactions, become space That's that margins CX to Chris to alluded to, more and transformational up

-- with to strong in G&A, leverage we of we'll the ServiceSource continue certainly get also to on recently to and organic there. growth rate acquisition as we see full run to closed continue synergies our a particularly Lastly, can show work,

to last So lots of that margins over we over can the up reasons couple pricing really the believe of environment quarters. much hasn't move changed Yes, all time.

in up So very of two over have price things I and North think, increases of parts in most increases. inflation Europe. successful getting services in keep will America have dealt We've those is that that the with to provide speaks, say to been to successful our the And we we the clients. I time about value pronounced it been as globe, across we with

You portfolio. say early currently still days in mentioned the outcomes-based that's pricing. amount of I pricing of outcomes-based fairly our in terms would

are more our coming of still in current We see, deals nor some on. set that deals of but it pipeline we're of not it preponderance our that is of executing seeing the we the through

it. lot you I then the on authorization. integration in I back just you allocation capital if that? authorized environment. last there a on are still I ask that know M&A increase. open further And stock? of closed know Board I your I involved you've for mean guys Got And can buying versus have to ServiceSource. in And saw question, my how dividend this you, -- Is thoughts a

going now? on why And forward. the thoughts like comment Just your timing how maybe capital allocate on you that, would just of

talk And CapEx needs all sorry, details. please the is well, going another thanks of for that part forward. can And you as if CapEx about

all I you questions. taking my So appreciate

Sure. Happy to.

there. and ServiceSource integration with start the I'll costs So

million our come be integration to at there we in look will through suggesting you of costs release, QX. are $XX another that If

spent $XX the half the first you come process, we're the capital thought view another third still integration then an what to probably accretive next spent $XX that, are million deal, think in still some From the back with spend cost to allocation in million unchanged. our in a in our and we as and having QX go be If we we perspective, would we'll roughly that important of to quarter, announced suggesting there in strategy. continue M&A we of part line when year. thoughts really the over We

certainly, and in about in, look technology be interesting through in think through a sets M&A as what And that to so a vertical or domain for will an perspective. we geography whether we client interested continue expertise, be we would M&A,

the we'd cash be still us continue to in a going share We're to committed that under strong didn't getting we nor to year. going get when feel bought think end generation. -- our the time, buyback we're end M&A, of At absent the flow. quite certainly, cash good we we as we were still of ServiceSource. Xx the we did to leverage look PK. commitment we we'll made to yet, we this generate under net active And that, Beyond free That's know by by And It's going buy have year. as Xx about to the been delever.

return have the flow to shareholders. As think cash and the dividend, is and anniversary of some we -- business initiation I free our of for it that confidence just year in to shows the the timing ability our this dividend. to capital generate the The first

to increase Board get story And and the so their to it That's to approval prudent really time the dividend. seemed recommend on that. the a like

a We Instructions] Barrington line have Research. question from [Operator Vincent Colicchio the of with follow-up

it still outlook the It's really us like healthcare bigger here ultimately. strong quarter. relatively become a growth thoughts and if your had a give of really maybe Chris, you. for a your Yes. looks on longer-term this could one small Thought -- vertical verticals you'd

Yes.

a healthcare growing to correct vertical very us, is Healthcare very well. key strategic. on you're accounts. So It is Vince, -- is all

kind verticals. its a continue just make to win in would it. that to and kind space. it perspective, a little just grow increase two we our you growing to We to that the of focused know to continue like healthcare be a to could off pull of size growth It big from lumpy of it within investments how on tends as for the deals key other be we forward But as are vertical that, see table, of And than sort strategic us. strategic

one. And then one last

there had or that a lack wages signs North of and no? in green Europe, You elevated. of of improvement America Any said better shoots remain word, for,

tell year that beginning of I being commitments our if heat problems it's in of marketplace. meeting the the the in quarters it, our aggressive business of is out also markets. the making that, early areas. of is tell sort we're bit. any than a but coming we're sure last predictable little I'll But a Probably not probably of we're off. to very it's to probably We're more elevated in sort change best maybe the outside where operations But seeing than having sort the still at those competitive what that you, say of way stable, heat putting will is cool the starting of guess, sort more I become in within of too bigger just

like remarks. for I conference would to to closing now the Chris you. back turn over Thank Caldwell

much, in look day. next everybody, great and quarter. Thank We today. very much, interest your joining us appreciate Have very always Thanks forward to much to very you everybody. talking a you for Concentrix, we

This you participating. conference for call. concludes today's Thank

disconnect. may You now