Q2 2020 Progress Software Corp Earnings Call
Okay.
Good day and welcome to the progress Software Corporation Q2, 2020, Investor Relations Conference call I, just kind of let's turn the conference over to Mr., Brian Flanagan Vice President of Investor Relations. Please go ahead Sir.
[noise] like you're not yet.
Good afternoon, everyone. Thanks for joining us for progress Softwares fiscal second quarter 2020 earnings call.
With me today is yogesh cooked up president and Chief Executive Officer.
Anthony Folger, our Chief Financial Officer.
Before we get started I'd like to remind you. The during this call we will discuss our outlook for future financial and operating performance corporate strategies.
Plant cost initiatives the impact of the coldest 19 crisis, what our business and other information that might be considered forward looking.
Forward looking information represents progress softwares outlook and guidance only as of today that are subject to risks and uncertainties. Please review our safe Harbor statement regarding this information which is available in today's earnings release as long as in the Investor Relations section of our website at progress Dot Com progress software assumes no obligation to update the forward.
Looking statements included in this call whether as a result of new developments or otherwise.
Additionally, on this call revenue operating margin diluted earnings per share and adjusted free cash flow about we refer to a lot of dog GAAP basis.
You can find a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP numbers in our earnings release issued today.
Today, we published our financial press release on our website. This document contains the full details of our financial results for the fiscal second quarter 2020, and I recommend you reference it for specific details.
Also published a presentation second thing supplemental data for our second quarter 2020 results, providing highlights and additional financial metrics. This presentation is available in the Investor Relations section of our website I didn't drafters dot progress dot com.
Today's conference call will be recorded in its entirety I will be available via replay on our website in the Investor Relations section.
I'll now turn it over to your gosh.
Thank you Brian.
Good afternoon, everyone and thank you for attending our Q2 earnings call.
Let me start by saying that I'm thrilled with our results for the second quarter, especially in light of the ongoing macroeconomic disruption caused by Golden Monkey.
All parts of the business, that's going to be incredibly durable and I'd like to expand a bit on how we're continuing to execute queued. This unprecedented crisis.
Our entire global work force had been working from home for what three months now without missing a beat.
Yeah construction systems, we've had in place have enabled us to effectively run off business emotionally.
And our employees continue to exhibit great flexibility and dedication.
Working diligently to provide the high level so far.
Named relationship management that a customer some partners need and expect.
Give me a lot employees healthy unsafe.
And preventing the spread of the virus and all communities is a much higher party philosophy, then we're talking to the office.
Plans to clinical work smoky for the foreseeable future.
One of the reasons our business has been so durable.
Going into faithful to economic upheaval caused by corporate 19.
These are long standing partner relationships.
This includes diocese that stupid applications on top of Openedge and people, yet, but embedded de <unk> in for their products.
We've been in frequent contact with many will fire season Oems.
And we believe that that business is she had many of the same characteristics that make progress so strong.
The products being built that you fly strongest technology have large established customer base.
These customers provide them with high levels of recurring revenue and a measure of stability during these uncertain times.
Oh, hi percentage of the coding gravity.
And the mission critical nature of our offerings and the applications the power.
We were able to deliver solid results in Q2, and we are well positioned for the remainder of 2020.
Revenue for Q2.
Oh, the high end up all guidance range with U.P.S. near the high end.
And yet you strong cash flows despite the headwinds of forward thinking.
Some of the revenue Overachievement was due to favorable FX impacts during the quarter.
But all of our businesses performed well relative to expectations.
Good enough, even more confidence in our outlook for the year.
During the quarter, we fine tune your important customers for <unk>.
Won a major U.S. based financial media and publishing farm.
And the other one of the world's largest global ecommerce companies.
Both of you spoke quite further evidence of the mission critical nature of our offerings.
And I'll be sea ice position as the industry standard for data connectivity featuring best in class security scalability and support.
Well the ways, we keep our business healthy and strong it's by continuing to advance our technology.
<unk> investments.
Despite what can come home.
Okay Roadmaps.
Well, it maps and where do you plan remain on schedule.
With our engineering organizations continue to work diligently on features and enhancements.
Well I felt portfolio.
Helping to support our strong retention rates.
During the quarter.
At least Openedge 12.2.
Features improved availability and security.
And moving 2020, which further improve secure data files, how far far more workforces.
These product enhancements are particularly important in time.
The lighting features that companies need right now given the worldwide shift the working from home.
We also launched usually this off identicals products, extending our lead and providing the first and most comprehensive set of native development tools for Microsoft laser.
Handle sitefinity, our market, leading digital experience backbone.
Wonderful Sitefinity customers is the World Health organization, which is a definitive resource for information Oncologic 19.
It's like somebody underpins all the information, but the W.H. always cutting people fighting on their website.
We have seen it dramatic increase in traffic dealing the pattern that that Mike.
Based on how to do performance the visibility we have into the rest of the year and ongoing feedback from a customer and partner base our expectations for the for the Youre having improved.
We're raising our revenue guidance largely to reflect the recent foreign exchange fluctuations.
We're also increasing I'll put U.P.S., partially due to the favorable FX impact I just mentioned, but also due to lower anticipated spending.
As a result off over 19, another efforts to offer it got business more efficiently.
Anthony looked like more do you feel for my guidance changes in his remarks.
But still a lot if I'm thinking into markets that we will continue to monitor closely.
But now more than ever we remain confident in the long term opportunity ahead of us.
So, let's not talk for a discussion off that long term opportunity.
As you know our strategic focus is to compliment that stable businesses with accretive M&A.
In the infrastructure software space.
Yes, all getting businesses that are complementary to our symptoms of product audience and profile and which also made the falling financial criteria.
One they have high level sort of cutting revenue with excellent renewal rates.
To the after synergies will deliver operating margins consistent with all margin structure.
And most importantly.
We generate a return on invested capital that is above our weighted average cost of capital.
The potential pool of target companies into sub 100 million dollar revenue markedly.
In the range is large enough to support our accretive acquisition strategy for many years, making this a viable path the delivering long term value.
And we'll both position both financially and operationally execution on X acquisitions of this type.
With the strong free cash flow generation capacity for additional debt and the ability to leverage our own operational and back office infrastructure.
Chief meaningful cost synergies.
You would think Lafayette successful acquisitions, Ipswich as a repeatable template.
I'm more encouraged than ever that we can achieve our goal of doubling the size of all company in five years to accretive M&A.
No I don't disruption in global markets have favorably impacted our M&A outlook in multiple ways.
First we have begun to see a decline in valuation expectations from companies considering the sale.
They should provide a greater opportunity for us to find the right assets I felt like valuations.
Second.
One left us I'm all faced with a decision on whether it be invest more heavily in that portfolio companies. During these uncertain economic times.
Or alternatively, whether to explore fail.
Why each business, we will consider its unique circumstances.
We expect to see more deals come to market. During this time.
That's good.
Finally, we believe the increased economic uncertainty made just talked in fewer competitors, who can match, our financial strength, making progress a more attractive incredible acquirer for these assets.
As we navigate these developing plans in the M&A environment. We're also taking steps to spend on our internal capabilities to identify and integrate target companies.
We took an important step into the direction in Q2 wouldn't be higher Germany, Siegel, our new senior Vice President of corporate development.
Jamie brings with him more than 20 years of experience and eating M&A functions at several technology companies and he is competing more than 35 software transactions during his career delivering significant revenue growth and increase shareholder value.
The Jamie Division, we have expanded line called capabilities and without strong balance sheet them consistent cash flows.
Here to be aggressive undisciplined as we execute on out a peak if M&A strategy.
Before I close I'd also like to comment on another issue facing us.
Over the past month, it has become increasingly apparent onto his longstanding systemic issues with racial and economic inequality that must be addressed.
The recent demonstrations on purpose I've highlighted that this time for all of US individuals communities businesses and governments to step up and helps eliminate these longstanding glacial bias.
Its progress I pledge that you will do all park could do what that flight and begin to affect the real changes that are long overdue in our society.
For us our efforts willing to providing greater opportunities for racial minorities and other underrepresented boots and hiring promotion and retention practices.
The stocks are changing attitudes and behavior.
And a consorted effort with dedicated resources.
With that and we have committed the hiring a chief diversity office. So that helped me and our management team and moving these efforts forward.
We've also committed to charitable giving the fights glacial inequality, having justice.
Yes, you will encourage our employees to contribute as well and match their donations amplifying the financial impact that you can have on these causes.
These are just a few of the several actions were taking a progress the cyclical industry.
I strongly believe they didn't more inclusive world benefit football.
And inclusion and diversity, which has been an important there you'll focus that progress.
We'll be off even greater importance as we move forward.
In closing I'd like to you tweak that I'm proved without you performance and a business remains healthy and strong.
Even as economies begin to function again, the future of course, all the pandemic is still largely unknown. So.
So we will continue to manage carefully and prudently to the kind of environment.
We remain confident that business is durable and diverse enough the continued to perform well even in this unprecedented environment.
And we are well positioned to execute on our goal of doubling the size of accompanying five years color peak of M&A.
Each will deliver real shareholder value.
I'd like to knock on the color what Anthony did have you thought you'd be performance and the outlook for Q3 and a full year in more detail.
Anthony.
Thanks, Yeah, that's bench the line.
Good afternoon, everyone and thank you all for joining the call.
Total revenue for the second quarter was 182.5.
1.5, feeling about the holdings of our guidance ranges, we provided back in March.
As you know gas nation, while much of this overperformance was driven by favorable exchange rates relative to those contemplated acute utilities.
We also saw slightly better than anticipated performance across all product lines as our teams executed well during the quarter.
Overall, our top one is proving to be extremely durable and stable.
Even in the face of deploying macro economic downtime caused by cold monkey.
This is in large part due to the high level, what Tony Robbins business.
Which has been largely unaffected by the recent economic downtime.
Our net revenue retention rate on maintenance remains well over 90%.
On the songs related revenue from our Openedge audience fees, we have deployed their applications in the cloud continues to be solid and steady.
On a year over year basis total revenue decreased by 1%.
The increase by 1% constant currency basis.
A few things to keep in mind, when comparing our Q2 results on a year over year basis on the.
The reaching the anniversary of the Ipswich acquisition.
We have a full quarter that switch was evident in our Q2 2020 results.
Compared to only one month in Q2 of 2019.
This positive impacts the lips, which seems partially offset by the second done.
For the year over year decline in DC onto that.
Which is consistent with the expectations, we outlined during our January and March guns calls.
As a reminder, the timing of DCR coincides.
So are we in part because can significantly impact our topline any given quarter.
Yes, so six generally requires immediate revenue recognition of our multiyear term license agreements with the OEM partners to embed our DC I caught it into their solutions.
As a result.
Really loved ones can fluctuate materially.
Anyone when these contracts are now.
This is Tony benefited us in fiscal year 2001 team.
And again in the first quarter 2020.
Caused RBC.
The decline year over year by $9 million in Q2.
We expect disappointing impossible recognized threatened to result in year over year declines in D.C. I Love me in the second after the year as well.
Driven by fewer schedules multiyear contracts during the remainder of 2020.
That's obviously makes year over year comparisons for DCR more challenging and the reason we believe annual contract value remains the most effective way to evaluate I'd Pcr business.
We continue to expect HCV to be 30 to 32 more I mean, so the whole year 2020.
Consistent with our onshore performance teaching us anymore.
Turning now to expenses.
Total costs and operating expenses.
62.9 million for the cool.
Down 1.7.
Q2, 2000, you won't see.
This year over year decline is the result in several factors.
First is the reduction in travel and placing the ones.
Both of which were driven by restrictions put in place.
Coming back to spread of coated <unk>.
Next our cost reductions we made in the second half of 2019.
Index, driving greater operating efficiencies and margin expansion.
And finally, both of these factors were partially offset by an increase in spend.
Written by a full quarter of its which activity.
For Q2 2020 results.
They're doing one in Q2 2019.
Operating income was 40 million for the quarter up slightly compared to Q2 2019.
Oh operating margin was 39%.
The increase of 100 basis points on a year over year basis, as we continue to maintain best in class margins.
On the bottom line.
Per share of 62 cents for the quarter.
Yeah, the hobbies about guidance range.
Down slightly from last year.
No due to the load you see on revenue I mentioned earlier.
Moving on now to what you balance sheet in past 12 metrics.
We ended the quarter with cash cash equivalents in short term investments a 201 more.
And debt that's 293 million.
Dsos for the quarter was 47 days.
An improvement two days sequentially.
But up five days compared to Q2 of last year.
This year over year increase was primarily due to the back because of men tea, which was in line with our expectations.
Deferred revenue with 172 young dropping into the second quarter down slightly compared to Q2 2019, reflecting typical seasonality.
Adjusted free cash flow was 38 million for the quarter down 3 million from Q2 of last year with the decrease in free cash flow driven primarily by the timing of collections.
We did not repurchasing stock during the second quarter.
As we pause to assess the potential 1.2 why business some type of monkey.
At the end of the second quarter. However, we still had $230 million remaining onto a plane share repurchase authorization.
I'd now like to turn to our outlook for Q3.
And for the full year 2020.
First let me reiterate that that's far the impact of the quoted monkey crisis on our business has been largely in line with what we laid out during our last update in March.
And as a result, I remain confident that we can achieve our financial goals for 2020.
That said, we recognize that decline challenging economic environment.
Likely to continue through the end about fiscal year.
That overhang continues to be reflected in our 2020 outlook.
With that said the third quarter 2020.
We expect revenue between 100 409 million.
This contemplates a 1 million dollar impact from the play with my team crisis.
As well as a widening our typical quarterly guidance range to account for greater uncertainty.
System with the guidance methodology to utilize puts you too.
Earnings per share between 69 and 71 cents.
The year over year impact of exchange rates.
On both how Q3 revenue and earnings per share is expected to be immaterial.
For the full year 2020.
We are increasing our revenue guidance should be between 433 and 443 million.
The increase largely due to a smaller foreign exchange headwind.
It was contemplated in our guidance last quarter.
When comparing our current revenue guidance to our 2019 results. It's important to haul like that we've included the saying 10 to 13 million dollar impact for the cold at 19 crisis that we contemplated on our last call.
$2 million adoption, so the anticipated negative impact of foreign exchange.
And the why does guidance range them with historically provided at the midpoint of the year to account for greater uncertainty.
We are raising our operating margin outlook should be approximately 40%.
An increase of 100 basis points from our prior guidance.
We are projecting adjusted free cash flow to be between 125 in on didn't 35 million unchanged from our pilot.
And we are increasing our guidance for earnings per share to be between $2.82 in $2.86.
The increase given by less spend across the business.
Smaller foreign exchange headwind and what was contemplated you know Biden class core.
When comparing our colleague Dps guidance to 2019 results.
The game important to note that we've included a two cents reduction putting anticipated negative impacts.
Foreign exchange on a year over year basis.
Well he will you PFS and contemplates a tax rate 21%.
Approximately 45 million shares outstanding.
He and the impact of 60 million in share repurchases were targeting it's a complete by the end of 2020.
In closing.
I'd like to either late but we are thrilled with our Q2 results.
Durability screen our business is displayed.
We continue to monitor their operations to be up soon on volume closely.
And we remain confident we can deliver solid results for Q3 and for the whole year.
With that I'd like to open the call acumen.
Yes.
Thank you if you'd like to ask a question. Please signaled by pressing star one on your telephone keypad. If you are using a speakerphone. Please make sure. Your mute function has turned off to life signal to reach our equipment.
Kick our first question from Steve Koenig from Wedbush Securities. Please go ahead.
Oh, great back your idea that's happening out there doing well.
I'll now be hope youre well too.
Yep, Megan and since your best.
On Openedge.
First off.
To.
Renewal.
Some of your Openedge agreements and and both both and I have to be but I was also thinking in terms of a direct sales as well as your house.
And it sounds to be renewals coming up this year.
You know what are you doing to managing risk around those renewals getting data around maintenance.
Not being two were impacted by coal that and what are you seeing out there with regards to those issues.
So so Steve actually they open edge business is you know running really solid you know we are seeing Arvind yourself.
Staying the same renewal rate on maintenance, both for direct and indirect and the same range that they have been.
Prior to corporate banking, so so really be a solid business. Yeah. Obviously, if there were some opportunities being maybe do a good deal and we need something a bit earlier, both may not happen. So we might have the timing differences for off in terms of exactly when the renewals happen.
But we don't expect or you know renewals to be any different income. So far you know going forward and the reason they simply a as you know schemes that.
Our Openedge platform is used both by I see that's one of by our direct customers in mission critical applications.
And these mission critical applications are once that you know maintenance is something that is kind of fit are critical for them to have.
It is better ability to we talked last and ask for health when needed and the like them with all of the update and fixes and all kinds of things. So so there's tremendous value in what we deliver in our maintenance. In addition to the upgrades a big at but even in the ongoing support.
Bug fixes and help so we feel.
Very good about the maintenance aspect off off Oh, you're not just only a you know actually Oh, yeah, hi portfolio.
I want to see solid maintenance renewal.
Cool okay for that.
If I may ask one follow up.
I would love to get Great I would love to get color, but $10 million to $13 million coal that impact for the full year, which is I'm systems.
Can.
You give us some color.
Let maybe a little granularity on that one you know <unk> is that mostly license.
Yeah, and you know are you seeing you know you're seeing some openedge are they they have they sell into that kind of love. The SMB markets you know in manufacturing, but another verticals you know kind of maybe just some color where where's the bulk about him.
Coming some and kind of geographically in the businesses, where does it show up as well when I said geographic I'm kind of thinking more about product lines as well.
Yes.
Now I can I can answer that once the threat I'm definitely you know when you have and they did the our assessment last quarter.
Yeah, we started with sort of the vertical analysis and really wanted to understand if we had exposure to in any industry that might be an unusually harsh.
I think the answer to that.
In other words not exposure to travel leisure.
It seems like that.
And so we then went through on a product by product spaces, and really made an assessment.
How we're making money on those products is it true retention and expansion.
Oh or do we have to continue to sell a lot of net new licenses.
And for businesses like Openedge and you can do you see I to an extent you know it's about retention and expansion we do sell some net new deals, but it is largely the tension and expansion than I think based on the relationships, we have with the with the partners and the Oems there that has some those products.
Some and building applications on top of those products.
I think we've got comfortable that there was not quite as much impacts there and so we looked at a lot of the other product line those appeared to be more transactional and maybe slightly lower price point.
Well I'm, especially those that rely a lot of you know or more net new license sales and that's really where we make the assessment to you not to take the bookings and revenue down as.
Bookings and revenue assumptions down for the year.
Geographically it was predominantly you asked me or there are we play I would say was you know for that so the known Openedge and do you see on a product lines. It was both direct and indirect I don't think we felt that there was more risk.
In either channel.
And it probably was glad you know maybe weighted a little more heavily towards.
License sales, but we also contemplate little bit of impact on maintenance and that was probably across the board. So that's how we've had it not I guess I would say that.
In the second quarter, you know the results were probably a little better than we anticipated that into all the product lines held up very well.
And you know study outlook I think remains largely the same for the potential impact and we'll just have to continue to monitor as we move to the year.
Got it that's super helpful. Anthony.
It's about Peter for answers.
Thanks, Steve. Thank you for questions. We're now going next to and just sort of strong from Sidoti and company. Please go ahead.
Hi, Josh and I finish and congrats congratulations on that get corridor.
I hope, you're taking them out and you can not mean acquisition is going to debt strong driver and just you touched on that pipeline.
Can you.
Just maybe it's still a good about how bad the environment has changed since we last spoke if nobody likes the amounts I don't think sands they called it broke out so.
I'll have stopped affected environments.
So on your thank you you know as if it's I owe you do a little bit, but you know the i. I think the environment is more favorable to progress right and it's it's a more favorable to us on a pretty different points out the way we see yet.
I do think that you know a lot over the.
And that's stuff out there who.
I have been looking at you know their businesses I'm, saying you know we kill their companies they want to continue doing Boston and which they should maybe decide to sell I think that is.
Creating a bit off an opportunity from more opportunities to conquer markets.
We have also on second be seen a decline in the valuation expectations from companies that are considering a fatal and so again that creates additional opportunity for us.
To find assets at the right value from our perspective, a and lastly, you know we we continued to be financially strong and up because we continued to be financially strong. We believe that we arent more attractive incredible acquired during these times.
You know with the cash that we have with the balance sheet that he have and then from a far up a other folks that might be in the market looking looking to acquire businesses. That's a we you know we see a healthy markets are we seeing opportunities and you know we continued to be optimistic.
How about our ability.
Ability to execute in the current environment.
Okay and did they get value do you expect financials to come down for there are so well.
What are you waiting for you know cheese or something like [laughter]. What are you waiting for [laughter]. That's a good question on yeah. You know, it's it's always you know a you know we continue to look at opportunities right and really do us it isn't whether the valuations on a broad basis needs to come down for the <unk>. It is asset by asset right.
Well what is it that that they and at the traffic is available at what they said that we can do with it.
And as you know we have very strict financial criteria regarding our deals right. So we you know we want to make sure that.
Anything we do a has high levels of recurring revenue has excellent renewal rates that we can I take out enough cost. So that the most synergies that margins are going to be or the same consistent with all margin structure and and of course, you know the most and.
What kind of aspect as you know we want to make sure that they've done rate is like that that is above our black and and I got to me all those things I mean that you know we look at each opportunity carefully you know and and when it is right we participate and when it was Nok we will also.
Happy to move on right and so I I don't I don't see if waiting so to speak for valuations to come down further I don't think that's sort of what it is I think it is just identifying the like assets and and making sure that we do our hard work and make sure that itself pick off so and again it will set the following on yeah right.
We we are very aggressive about this but at the same time, but also they discipline and and I have said this over and over right I'd like to do one Beulah your get off maybe 10% to 20% of our Ah off our revenue and if we can do that consist complete a you know do 700 million dollar deals.
You can actually in five years doubled the size of the company and we feel confident that we can do that.
Okay. Thank you for that additional hotter I'm Dan.
Just curious for your recurring revenue I love that stuff contracts tends to be and how sticky is tax.
So you know good, but that's sort of babies a little bit five portfolio. So let me share with you. The BPCI portfolio has probably the longest contract in fact definitely keep the longest contracts on the average.
Many of the I.S. and use that OEM D.C. I will find five year contract. That's not unusual three years to five years, because his though because the vast majority of them.
Openedge is oh, a bit less but you know well open it has different right openedge. The I.S.C. business is really it doesn't bring new Orleans, the same sentence I. If the business is an ongoing relationship that basically is is they revenue share model for the vast majority of them.
And so it's more about you know they basically collect their maintenance revenue from their customers and they have for Pico back order, if they expanded I'm a bit their footprint that take off tomorrow and selection of licenses they'd be felt it kinda give us a piece of that I thought revenue. So so badly because actually you know really beat.
They'll quite long terms as well and maybe the babies are not shocked agreements because these people that beat that business applications on top of fought back for a and b that mission critical but their customers and they are business critical to these businesses because they are bread and butter for their businesses.
<unk> direct side of OE, a again I would say a three years, it's probably be most common harm there.
But when you come to the Devtools side, and if such product portfolio, what's up gold and and and move. It. Those are typically you know shorter agreements many of them all one yet agreements some argument for yet agreements, but many of them on one yet agreement. So you know again it it could.
No babies without portfolio and as as we've said before right I mean, crunching already cut above 90% for the for the whole business and with products like Openedge. They are willing to then I'd.
Okay.
Thank you and then I'm also curious so you know you're being kept company I assume you have I love that formed work for us and now with this.
Yeah Executive order on foreign V SAS, how I do not sure how do you anticipate that impacting your business.
You have a lot of so we can you know so actually we.
So so on yeah, and interestingly enough you know when you don't really have a lot of a employees that come to the U.S. from abroad that are on the kind of because if you know at at the extended work here type of besides like big there, but we have.
Our our international employees actually work out there can be off that somebody gave the office as well as other European and and you know.
In Asia Pacific as well as so you know or cut off it right, there, though a central and Latin American offices. So these folks primarily come from four business with its of course, none of those businesses are taking place right now working from home, we're not doing any travel, but both because of a different then.
Then the work that he says that have been put 'em horns. So up so we don't do we see a meaningful impact for us.
Actually because of this.
Okay. Thank you that's good color and that was awesome. Thank you so much.
Thanks, John Thanks, Yes.
That concludes today's question and answer session.
Go ahead and send it back to the speakers and before that we have more accessible from benchmark who'd like to ask one last question.
Hi, Good evening. Thank you for taking my question and are nice job on a quarter and.
Difficult environment here.
You'll get a sense of course for you.
Just a question on the share buyback program you know, it's such a strong balance sheet. What works just spend a buyback if I recall correctly, you spent about 20 million last quarter or share repurchases, but oh. This is just give us a little bit about the thought process on spending.
The buyback this quarter.
Sure So I didn't and I'll, let Anthony add as well, but could you do you know from our perspective, it was purely to them to around making sure I mean, I mean markets you know like in March the World was looking big I'm sort of okay, and and we felt very confident about our business, but at the same time right. It makes sense to be.
Who didn't and not a you know go ahead, and and do buybacks and because they'll fashion for the timing you know we did remarkably well in the quarter I'm truly excited about it. Thank you for a couple of months you know, but we just we would just prudent in the quarter and and being cautious and just to make sure.
With that we didn't go out and do something that neutral undergrad simple as that Hey, you know no you know and no other reasons.
Okay, Great. That's great. Thanks, and then or just a follow up on your does yard because as you have some really nice wins last year. So these yard, which which is a pleasant surprise for renewal business [laughter].
[laughter] just give us a few additional details bickered on two new D. She does she does your views the score.
Yeah. So you know a mark. Thank you you know, it's it's actually an interesting business like in general because they you know as he said it fit maintains a new you know business that that community is what it is in the vast vast majority of it I.
What would be used to be a car or basically you know so they can you talk about them separately or there's a large a U.S. oh financial and media company that needed to connect it's or analytics information and there are some pent applications to the some of their data.
That'd be really what challenged and doing a they did not want to build a bit of themselves.
No I looked at hold everything else that without there being a financial institution, a you know security and reliability or at the top of the list and so you know we turned out to be the winners and we're really happy about that right.
Similarly, a the global ecommerce a company.
They also been interesting case there. They are also Ah you sort of sales force a they had also they also have some other technologies and they wanted to again access data. Both you know from on Graham and cloud.
And data into into one place for they own internal there's no supporting and business analysis and again. They found that we were the best solution for them as well they have scale and performance Oh, we're probably the bigger drivers not the securities ever not a driver sick everybody wants.
Something to be secure by bad actually scale and performance was was the more key thing. So you know we're really proud that we wouldn't be but at the same time Mark you know we win one or two a year [laughter] you know I actually tell people that he out there. So it is great when we wouldn't want ARPU, but but that's the way it goes and and you know how itself.
A little bit of churn we have on the you know it helps us with a little bit of churn we have with our Ah you know a other parts of all of this business.
Look I remember a period of five plus years or I don't think though the company want a single use your ideal so one or two years [laughter] <unk> business, you're right I want. Thank you Mark Thank you yeah.
Susan outbound outreach that you're trying to generate this business or is called copper is coming to you and be sure.
I think I think it's a little bit they'll both the we'd be lagoon, a little bit of online demand and stuff to email marketing in Taiwan.
And then you know that's how the lead show up and then and then be engaged by maybe an inside sales efforts to begin with a and then with some of these large once you know we might even have a meeting but of course in NBC. You know these current my last 90 days you know there were no meetings, what's interesting about this the this market I think actually what has been driving that the fuel.
With that will be much will pick up over the last couple of years.
We need up the investment was made in R&D right. If you think about it right. We have now expanded our BPCI capabilities to both do cloud and ground to cloud applications and data from filed applications data from cloud databases data from on Prem application with data from on Prem databases and availability of that data connectivity up there.
Yeah to cloud applications and go on Prem system, So both ways like and and I think that has a tremendous keeping useful and we've actually added things like Rafi eyes, and so on and plus we never they brought portfolio of technologies. We connected so they don't think these are few and far between but yes.
Yeah, I couldn't be happy that over the last couple of years, we have made a few new wins.
Great. Thank you so for me.
Thanks Mark.
Thank you very much that concludes today's question and answers session I'd like to give the conference back over to Mr., Brian Finnegan. Please go ahead Sir.
Thank you all for joining the call today as a note we plan on releasing financial results for our fiscal third quarter of 2020 on Tuesday September 29, 2020, after the financial markets close and holding a conference call. The same day at five PM Eastern time.
Now I'll turn the call or T O gosh for his closing remarks.
Thank you Brian.
With a solid through two behind us and despite the current level of uncertainty. We look forward to continued strong performance in the second half of 2020.
The company it financially strong and healthy and we continued to execute aggressively on our strategy to drive long term value.
Cool accretive M&A in the infrastructure software space.
I want to thank all of you for joining us today and I look forward to speaking with you again given on next quarter's conference call.
Stay healthy unsafe.
This concludes today's call. Thank you for your participation you may now disconnect.
[noise].
[noise] Oh.
[noise] or [noise].
ER.
And Oh.
[noise] ER.
[noise] Oh.
[noise].
[noise] ER.
[noise] ER.
Uh huh.
[noise].
[noise] and [noise].
[noise].
[noise] and.
[noise].
[noise] and [noise].
[noise].
[noise] Oh.
[noise].
ER.
Uh huh.
[noise] ER.
Or [noise].
[music].
Yeah.
Oh and.
[noise].
[noise] ER.
Uh huh.
[noise].
[noise] and [noise].
[noise].
[noise] and [noise].
[noise].
[noise] and [noise].
[noise].
[noise] Oh.
[noise].
ER.
[music].
Oh.
[noise].
[noise] Oh.
Oh.
[music].
[noise] and [noise].
[noise].
[noise] and.
[noise].
[noise] and ER.
[music].
Oh.
[noise].
[noise] ER.
[music].
[noise] and [noise].
[noise].