Q4 2020 Everbridge Inc Earnings Call
[music].
Good day and welcome to the ever Bridge fourth quarter earnings Conference call.
All participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing the star key followed by zero and.
After today's presentation there'll be an opportunity to ask questions to ask a question you May Press Star then one on your Touchtone phone to withdraw your question. Please press Star then two.
Please note this event is being recorded.
I would now like to turn the conference over to Joshua Young. Please go ahead.
Thank you Gary good afternoon, and welcome to ever bridges fourth quarter and full year 'twenty and 'twenty earnings Conference call. My name is Joshua Young Vice President of Investor Relations for every bridge and with me on today's call are Jamie Ellertson, Chairman and the board, David Meredith CEO and Patrick Brickley Senior Vice.
President and Chief Financial Officer.
After the market closed we issued our earnings release, which can be accessed on the Investor Relations section of our website at IR day ever Bridge Dot Com. This call is being recorded and a replay of the teleconference will be available on our IR website at the conclusion of today's event.
During today's call, we will make forward looking statements regarding future events or the financial performance of the company that involve certain risks and uncertainties. The company's actual results may differ materially from the projections described and such statements factors that might cause such differences include but are not limited to those costs and how.
And 10-Q, and 10-K as well as other subsequent filings with the SEC.
The information provided on today's call requests on perspective, only as of today February 18th and should not be considered representative of our views as of any other subsequent day, we explicitly disclaim any obligation to update any forward looking statements or our outlook also during today's call we will refer to certain non.
Non-GAAP financial measures a reconciliation of our GAAP to non-GAAP financial measures is included in our press release with that let me turn the call over to Jamie to begin our prepared remarks Jamie.
Thanks, Joshua and thanks to all of you for joining US today I'll keep my comments brief because I know that David and Patrick and a lot of highlights to share regarding a record year with numerous customer wins and accomplishments.
But before I begin I feel compelled to acknowledge the freezing temperatures and widespread power outages facing Texas and other states across the country.
Our <unk> platform is purpose built for these crises and our teams are actively supporting our clients across this region assisting with hospital evacuations sporting state and local governments with their communication and critical information on shelters and providing wellness checks residence.
Helping businesses and our it teams conduct proactive and preventative measures and advance of power shutdowns.
We have hundreds of public and private customers across this region and are reaching out with our continued support.
Now looking at our results our fourth quarter was a solid finish to what was an exceptional year Forever Beach.
Our execution was excellent during a time that was turbulent and unpredictable.
During the year, we were able to exceed our outlook and increase our guidance every single quarter.
On the proud of the agility of our team demonstrated and quickly developing innovative new solutions on our <unk> platform to help customers such as contact tracing returned to work and vaccine distribution.
These solutions are extensions of our CGM platform and help customers to identify and manage and respond to new threats against their people assets and processes.
And it will speak more about these solutions later in the call.
We ended the year with a record revenue be reporting revenue of $271 1 million up 35% from a year ago and adjusted EBITDA for the year.
And at 56%.
Our scale and robustness is also reflected and the number of interactions.
<unk> delivered in 'twenty, and 'twenty 5 billion up more than 40% from last year.
More importantly, we achieved these results while continuing to invest in the long term growth of our business and making key investments and our people.
Processes and products.
And just as important through David and Patrick leadership, the team delivered very strong adjusted EBITDA and cash flow.
We have continued to expand our sales reach not just with the growing sales organization, but also by engaging key partners that extend the ever bridge value proposition to a far greater audience and we get accomplished on her own.
We are meaningfully investing and our solutions expanding what is already the most comprehensive offering for critical event management with new applications, New created data sources and new use cases.
As a result, we're better positioned than ever before to lead the critical event management market and deliver attractive growth and the multibillion dollar opportunity that lies ahead of us.
'twenty and 'twenty has demonstrated how the ever bench team can adapt cen.
Old any critical events, even a black Swan event like Covid that literally flex every organization and person on the planet.
And our ability to successfully address these enormous challenges begins with our management team led by David and Patrick.
As I transition from executive Chairman to non employee chairman of the board, which was completed in January of this year, I'm confident and David's leadership and I'm excited for our team on what the future holds ahead.
Even though and no longer and operating and an operating role I remain committed to ever bridge, our employees customers and shareholders.
Now I'll pass the call over to David to provide the details of our fourth quarter and full year David.
Thank you Jamie for your continued commitment to our mission of keeping people safe and organizations running faster.
We posted another strong quarter and Q4 with record setting a S piece and the largest revenue beat versus guidance and our history.
Revenue in the quarter was $75 $6 million up 32%, despite a strong comp and the previous year.
Our adjusted EBITDA was $4 $1 million also exceeding our guidance.
As we continue to effectively balance growth investments with prudent expense management.
Throughout 2020, we delivered strong operational execution, and what was the demanding and turbulent year. The agility of our organization enabled us to not only transact and numerous challenges but to better serve our customers with innovative new use cases, such as contact tracing returned to work and vaccine.
Distribution.
All of which leverage the power of our CE and platform.
In fact, these newly introduced E M applications and use cases helped us to set numerous records and the fourth quarter and 2020 and.
In Q4, specifically, we achieved several new high watermarks, some of which had just been established and the previous quarter.
Including setting records for the number of C. E M wins, the number of six figure deals quarterly average selling price international and revenue and sales mix of new products and.
In addition to record revenue and our highest ever revenue beat we also delivered our best ever quarterly free cash flow.
And allow me to remind you that we routinely break our own records, but what we look to deliver solid growth across all metrics and not just one time highs.
Turning to our full year 'twenty and 'twenty results, where we also set new high watermarks.
And 2020, our applications that identify risks and automate the response required to keep people safe through Hurricanes major cyber attacks fires and the pandemic reached a record 5 billion and critical interactions demonstrating our scale resiliency and market leadership.
We closed the highest ever number of multi product deals dilip.
<unk> delivered record revenue.
And we reported our highest adjusted EBITDA.
Finally, I want to point out that as a leadership team, we work hard to meet or exceed our stated commitments to our stakeholders.
One target that we talked about coming into 'twenty and 'twenty before we even began thinking about the pandemic was a goal of generating positive free cash flow for the full year.
I'm pleased to report that we delivered this commitment by finishing the year with free cash flow of $2 $9 million.
Before getting into the details of what drove this record performance.
I wanted to take a moment to recognize the continued heroic efforts of our first responder medical and public safety professionals.
These individuals continue to put themselves at risk in order to protect the broader population from this pandemic as well as events such as the recent earthquakes in Japan, the terrible forest fires in Australia, and California, the deep freeze and parts of the United States.
And even major cyber attacks like the recent solar winds breach.
And in every case ever bridge was present to help keep people safe.
More recently people are asking how we successfully navigate the road to recovery from COVID-19.
Which currently involves solving challenging logistical issues related to bi vaccine information.
Access distribution and administration to the public.
Many of you have heard or read about the hundreds of cities states educational institutions and major corporations that are using our <unk> solutions, such as contact tracing or returned to work to help people stay informed about the pandemic and to reduce risk upon identification of COVID-19 within their organizations are.
Entities.
Like other critical events the majority of the actual effort goes into and not just the upfront warning or provision of how to stay safe, but actually into the resolution phase determining when and how to safely go back into communities.
This dynamic impact millions of people from communities to entire countries.
Each with their own unique set of variables to determine how to keep people safe and get organizations running.
For the pandemic vaccine distribution represents a key to resolving the challenges presented by COVID-19, which ultimately means saving lives and reopening our economy is faster.
And to properly manage the sheer scale breadth and resiliency required to address this challenge from small rural counties to major population centers people depend on proven and trusted solutions like ever bridge that can operate quickly and efficiently to save the most lives.
This important recovery phase of combating COVID-19, the mass distribution of vaccines, it's just beginning and.
And it could last for an extended period as distribution of vaccines reaches higher levels and potential boosters are needed.
To counter and new variants that are already appearing around the globe.
The distribution challenges include monitoring and vaccine availability tracking vaccine shipments and scheduling vaccinations as well as scheduling and follow on appointments.
All of these will require a critical event management solutions that are already integrated with various public safety systems.
Our <unk> solution automates much of the standard protocols and processes to successfully manage millions of critical interactions a day, which are tested and proven to scale and deliver reliable performance and set a requirement that we believe only ever bridge meats.
And Q4, we rolled out vaccine distribution solutions to organizations from West, Virginia to Ohio to Florida.
And West Virginia, we rapidly rolled out a statewide solution achieving nearly 100% of first round dose has been successfully administered.
This implementation of our <unk> solution with our partners and West Virginia has been widely recognized as a poster child for successful vaccine distribution.
And our work with West Virginia has received positive recognition on major Prime time news shows such as C. N N Tonight, ABC news and NBC news as well as other major media outlets and the response to our early success and vaccine distribution has driven interest and our unique and differentiated solution, which we expect we will.
Continuing to grow as the vaccine and gets administered to more and more on the population.
So all being this public health crisis faster will unlock the ability for governments to fully reopen economies for the betterment of all states people and businesses. We believe this success is emblematic of how we help organizations recover from large scale critical events now and into the future.
Our critical event management technology forms the basis for these new applications, which helps to drive broad interest and our cm and population warning applications, resulting in a record number of six figure deals.
And the fourth quarter. We also saw a record number of new and growth customers adopt CGM for a diverse range of use cases, which helped drive all time high asps and the quarter.
As we look back on 'twenty and 'twenty, we continued to make significant progress, adding new logos to our thousands of enterprise customers, we extended our leadership and critical event management with accelerating customer adoption and new use cases for our CE and platform we.
We advanced our C M rollout and key international markets to help drive long term growth.
We also continued to see success with our population warning solutions capped off with major wins in Europe and Asia during Q4.
We drove new partnerships that will significantly expand our sales reach and volume.
And we continue to invest and our platform sustaining a focus on innovation to drive our long term success and.
In addition, our solutions for new COVID-19 use cases, we recently announced and next generation front and for our public warning solution.
This new front and enables customers to create and send a combination of cell broadcast and address group and location based SMS alerts for countrywide warning through a single console.
And I'm proud to announce that we have received important patent protection for this innovation.
Our comprehensive population warning platform is unique and its ability to provide reliability and scale and coverage for entire populations all on a single platform.
Speaking of patents. We were also recently awarded a patent from making these alerts multi media capable by leveraging the power of five G networks.
And now we have 15 public warning patents out of more than 160 coat total.
This evidence of our CGM leadership, expanding our global reach and enhancing our technology platform will continue to power our success and 2021 setting us up for another strong year.
Yeah.
Looking deeper into our strong fourth quarter metrics.
We added 146, net new enterprise customers and the fourth quarter, increasing our total enterprise customer count to 5613.
We had a record quarter for <unk> with 18 customers selecting or upgrading to C M and the quarter, bringing the total number of <unk> customers to 128 up 68% from the end of 2019.
Despite our impressive gains in 'twenty and 'twenty the number of our customers who have adopted <unk> still represents a low single digit percentage of our more than 5006 hundred customers, providing us with a substantial growth opportunity.
With a growing number of larger deals our average selling price and the quarter increased substantially to well over $100000 breaking the record we set just last quarter.
This resulted in a trailing 12 month asps of more than $77000 from the fourth quarter and the second highest trailing 12 month figure in our history.
When combined with net adds that were above our target range and this resulted in meaningful sales activity for the quarter.
And the fourth quarter. We also closed 66 deals of more than $100000, a new record, including several that were valued at more than $500000 per year.
We closed 188, six figure transactions and 2020.
Up 35% from 2019 with both new and existing customers. Among these illustrating continued success of our land and expand strategy.
And the fourth quarter, we completed 121, multi product deals with new and existing customers.
And with our customer base subscribing to an average of only two of our applications. We believe that we still have significant room to grow.
From a product mix perspective.
A record 66% of new and gross sales over the last four quarters came from new products, reflecting high demand for our newer applications.
Our international business continues its strong growth.
And the fourth quarter, we saw 28% of revenue from outside the U S compared to 20% a year ago.
Combined with our high overall growth. This means international revenue increased by 88% from a year ago and the quarter driven by public warning and other transactions that I'll review and a moment.
For the year International revenue also grew more than 50%.
The international opportunity will continue to be a meaningful growth driver for us in 'twenty and 'twenty one as we increasingly focus on further penetrating additional geographic markets.
Finally, our revenue mix by vertical was consistent with recent history coming in at 63% from corporate 26% from local state and country wide government and 11% from healthcare, reflecting consistent growth across our target markets.
As always we remind you that quarterly metrics can fluctuate, but the longer term trends continue to reflect our overall business momentum.
Now allow me to pass along a few of the customer stories that drove our strong fourth quarter metrics.
Our flagship <unk> suite is the broadest and most advanced technology solution for keeping people safe and organizations running cusp.
Customers increasingly realize that <unk> is not a nice to have it's a must have.
And for protecting and increasingly remote workforce.
And wins in the fourth quarter include new customers, such as Salesforce Dot Com, a leading cloud company.
We're also excited that new customers adopting CE and include a Biopharma company, who has developed one of the two early COVID-19 vaccines as well as one of the leading U S cosmetic retailers to name, but a few exam.
Examples of other C. M wins include government wins like the Virginia Department of emergency management, and and Ohio, The Adjutant General's Department.
After launching <unk> internationally less than a year ago with Siemens as the leading early adopter and the region. We continue to add highly respected brands with new CE and wins in Europe, including Roche Lyng group, a leading plastics manufacturer in Germany.
Roche linked shows ever bridge to digitally transform their corporate health risk and security programs, providing one proactive unified platform to manage all potential risks.
Our European wins also included market leaders like one of the biggest broadcast and media companies and the United Kingdom.
In addition.
And new customers, a number of existing customers upgraded to see EM illustrating the success of our land and expand strategy.
These included Chico's, a leading women's clothing retailer as well as a leading multinational supermarket chain, who upgraded from mass notification to the broader <unk> suite.
In addition to these new CGM stories, and Q4 and Q4, we saw numerous other major organizations like <unk> and as their platform of choice to not just provide assistance to their teams during the resolution phase of the pandemic, but to power the safety and resiliency of their organizations for years to come.
These included organizations involved and the resolution of the pandemic like Garnett transport medicine.
Operator, COVID-19 testing and vaccination administration and the northeast to pharma leader exact sciences as well as other leading brands across all industries.
Additionally, godaddy chose to replace many of their manual processes with risk intelligence and automation of response interactions from our <unk> platform.
Keybank National and a financial space chose <unk> to help them keep their thousands of customers and associates safe during the pandemic recovery.
And we expanded our relationship with the Los Angeles International Airport, the second busiest airport and the United States.
This represents a great example of a current core mass notification customer that moved up to our C and platform to manage all critical incidents or events at.
And that their state of the Art Airport and resource control Center.
Including promoting a safe return to travel.
Overall, a remarkable quarter for new <unk> implementations that will create momentum for 2021.
In addition to direct sales we are focusing on our partner ecosystem to extend our <unk> sales reached through indirect channels. During the fourth quarter, several leading names became CEO and distribution partners, including Northland controls, a global physical security integrator and consulting firm and addition to being a partner who is our.
<unk> demonstrated past success with our previously announced Cisco C. M deal North and controls also became a customer and their own right and the fourth quarter.
We also announced an expansion of our relationship with Atlas.
You'll remember apoptosis the partner that led our state of California win.
This extended partnership assets will create new routes to market Forever bridge by leveraging their global network of relationships across both public and private verticals.
Ever bridge will help out just clients globally enhanced their preparedness for manmade and natural and digital crises worldwide.
These are substantive distribution relationships device defined by significant seven figure annual revenue commitments, making them and important part of our overall indirect strategy, which I first discuss as a goal upon joining the company and CEO.
Additionally, we're working to further extend our partner ecosystem with leading brands that we expect to announce later this year.
In addition to growing demand for C. M. Our Q4 results represent strong adoption across all of our public warning solutions.
One example would be another seven figure win for our mass notification solution with the state of Oregon further extending our statewide wins, which now total seven.
And as we've seen in Florida, and New York and California. In addition to representing a new state wide deal and our win and Oregon should lead to our network effect success at other institutions like higher education.
Hospitals local public safety as well as the major corporations to drive our long term success.
We also saw a substantive number of new and growth mass notification safety connection and it alerting wins across all markets globally.
Beginning with leading brands like Neustar, and North America also gas and Canada and one on France is leaning home health care providers all of him and shows our safety connection application to keep their employees safe from critical events and assist with their organization's broader return to work programs.
Our mass notification incident communications and risk center applications registered new wins, and one of the world's largest copier and printing companies Muskegon Creek nation and architect of the capital to name just a few.
And our I T alert and product was selected by leading organizations globally, such as Phoenix pharmaceutical G M BH, and Germany Rite aid and epic systems in North America as well as one of the largest global pharmaceutical manufacturers based on the United Kingdom all to help their teams manage critical items.
Vince that threatens their organization's ability to keep running.
It is important to note that all of these customers signed six figure plus contracts and for many it's just the beginning of their journey to the full <unk> suite.
Finally in addition to our strong statewide Oregon win.
We saw continued success and the federal market with wins like Defense Finance and accounting services. Another new agency win and major expansion projects at one of the four major branches of the U S military as well as one of the largest military locations and North America.
Our international momentum also grew in the quarter with numerous notable public warning transactions around the world.
Demonstrating our network effects and the fourth quarter, we expanded our countrywide wins in Europe by signing three of the United Kingdom's four largest network providers for our cell broadcast public warning solutions, while we believe that most of the activity related to the EU mandate, requiring countrywide public warning systems will come.
Later, this year and into early 2022.
We are excited by these early wins and Europe, reinforcing our position as the leader with the most countrywide deployments with customers in each region of the world.
And Sweden, we signed a significant five year expansion of our population warning contract, which now includes all the mobile operators.
Enabling Sweden and location based SMS alerts to virtually every resident and visitor.
Power and by ever bridge through Sos alarm the national system operator.
In addition to our success in Europe, we added the Indian state of Corolla, and the fourth quarter home to over 50 million residents and annual visitors, representing a major new public warning customer for us.
It's truly exciting to see these public warning wins across multiple continents.
In summary, our excellent fourth quarter capped off a strong year for ever bridge.
We're proud of the role we continue to play and keeping people safe and organizations running during.
During 2020, we focused on expanding our leadership and C M expanding our sales reach with more indirect channels growing our international footprint and extending our technology.
Our success in these areas sets us up for another strong year in 'twenty and 'twenty one.
As we continue to penetrate a multibillion dollar market opportunity.
Now I'll turn the call over to Patrick for more details on our fourth quarter financial performance and our guidance for Q1 and full year 2021, Patrick.
Thanks, David.
I'll review, our financial highlights from the fourth quarter and provide guidance for the first quarter and full year 2021.
In addition to a number of record business metrics as David mentioned, we also posted a number of new high watermarks for financial metrics and the fourth quarter.
Including free cash flow.
Revenue in the fourth quarter was $75 $6 million and increase of 32% from a year ago and the largest dollar beat versus guidance that we've reported in our history as a public company.
Our net retention rate continues to track well above 110%.
Reflecting consistently strong customer satisfaction combined with demand for additional ever bridge technology and existing customers.
Looking at the details of our P&L unless otherwise indicated I will be discussing income statement metrics on a non-GAAP basis, a reconciliation of GAAP to non-GAAP measures has been provided and the earnings release, we issued earlier today.
Gross margin was 73, 7% and increase of 340 basis points from last year as we continue to benefit from greater scale.
Total operating expenses and the quarter were $54 $4 million and increase of 45% from a year ago, reflecting continued investments and our platform and our go to market strategy.
Adjusted EBITDA was $4 $1 million.
Above the high end of our guidance range and reflected the backend weighting of growth investments this year.
Net income and the fourth quarter was $1 million or three cents per diluted share compared to $3 $2 million or <unk> <unk> per share a year ago.
On a GAAP basis, our net loss was $24 $6 million.
For the full year, 'twenty and 'twenty revenue was $271 $1 million and increase of 35% from 2019.
Gross margin improved 160 basis points to 72% and 2020.
And adjusted EBITDA also increased $8 million for the year and increase of 56% from 2019 and a record for the company.
Looking at our balance sheet, we continue to be well capitalized ending the year with $475 6 million and cash cash equivalents restricted cash and short term investments.
Compared to $477 $2 million at the end of the third quarter.
Free cash flow was a record $15 $9 million for the fourth quarter compared to an outflow of $1 $3 million a year ago.
For the year free cash flow was $2 $9 million.
Total deferred revenue was $171 million at the end of the quarter and increase of 27% from year ago, and a sequential increase of more than $20 million.
As we know every quarter, our deferred revenue balance at the end of any given quarter can vary due to a number of factors Inc.
<unk>, the timing of significant new contracts and the timing of annual billings for new and existing customers.
For example, we saw an increase in the eight figure backlog of completed transactions that are not yet reflected and our deferred revenue, but will have revenue recognized in future periods.
As such the change in deferred revenue and any given quarter is not an accurate indicator of the underlying momentum and our business.
We believe our trailing 12 month performance, it's much more indicative of our overall business trends and that our longer term performance continues to support our growth objectives.
Now I'll turn to our guidance for the first quarter and full year.
We believe our grilling market momentum increasing market awareness and robust demand for our technology support and our expectations for continued rapid growth in 'twenty and 'twenty one.
Our guidance for 'twenty and 'twenty, one and also includes the impact of continued technology and operating investments to support building greater scale and our organization.
Throughout 'twenty and 'twenty, the overarching focus on the pandemic and recovery.
Accelerated demand for certain parts of our business and likely delayed customer decisions on other initiatives.
We believe that this has created certain levels of pent up demand as well as new expansion opportunities, but that it will be difficult to predict with certainty when customers will begin to pay more attention to their important broader term initiatives.
Further while we benefited from a significant decrease and travel related expenses and 2020, our guidance for 'twenty and 'twenty, one contemplates that we will see an increase and travel and related costs later in the year.
As a result of these factors we continue to be very enthusiastic about our prospects.
But we'll continue to take a sensible mature approach to our guidance.
With that backdrop for 2021.
We expect revenue to be and the range of $342, one to $344 1 million representing growth of 26% to 27%.
We anticipate adjusted EBITDA to be and the range of seven five to $8 $5 million.
We expect a non-GAAP net loss of between $8, eight and $6 $8 million on.
Or a loss of between 25 and 19 per share based on $35 6 million basic and diluted weighted average shares outstanding.
This guidance assumes estimated stock based compensation expenses of approximately $56 $9 million for the year.
For the first quarter, we anticipate revenue of between $75, three and $75 $7 million.
And year over year growth of 28% to 29% for the quarter.
We anticipate and adjusted EBITDA loss of between.
Six one.
100000 and $200000.
We anticipate a non-GAAP net loss of between $4, one and $3 7 million or 12 to 10 cents per share based on $35 5 million basic and diluted weighted average shares outstanding.
Stock based compensation expense is expected to be approximately $13 $7 million for the quarter.
In summary, we delivered a strong fourth quarter and year and are well positioned to continue our track record of rapid growth as we further penetrate the multibillion dollar opportunity ahead of us.
We believe we are better positioned than ever to deliver on our mission benefiting customers employees and our shareholders as we continue to penetrate this opportunity.
Now operator, we'd like to open the call for questions.
We will now begin the question and answer session.
To ask a question you May Press Star then one on your Touchtone phone.
If you are using a speakerphone. Please pick up your handset before pressing the keys to withdraw your question. Please press Star then two on.
Our first question is from Scott Berg with Needham. Please go ahead.
Hi, Jamie.
David and Patrick Congrats on what looks to be a great quarter and thanks for taking the questions.
I guess first question, David and I know, we've had a couple of conversations about this last six months and.
Patrick just talked about some pent up demand there.
I know, it's early and you don't know what the timing of this potential pent up demand looks like but what are you seeing in terms of thawing of budget scenarios that a year ago, where we're probably ready to be spent but recent.
We recently had been pushed to the sidelines.
Hey, Scott.
Good to hear from you. Thank you.
Yeah, I think it's a great question and you see you know.
As we came into this Q4 and we looked at last Q4, which is our all time record blowout quarter for us and you say well that's going to be a tough comp and then this Q4, we set a new record for the most number of six figure deals we've ever had on a quarter.
And the most MRC and deals we ever had and a quarter.
That does feel to us like.
Things may be starting to thaw and as you know as we exited.
Q4, and looked at the sales funnel and definitely saw more seven figure deals and the funnel than than I'm used to saying since I joined the company. So it does feel like things are starting to thaw, but with that said, we do want to be prudent in terms of you know we're still in a dynamic situation with variance and the other vaccine and the economy and a lot of different things going on.
As we look forward, but we do like some of.
The the signs we saw as we came out of the quarter.
Excellent and helpful and then from a follow up.
Question Patrick.
Biggest revenue beat ever and the quarter, we know that you've had the opportunity to sign a couple of perpetual license type deals.
And to understand what drove the large revenue beat and the quarter was it maybe some linearity in the quarter that happened earlier than expected or maybe some of the perpetual revenue that came in and any color there would be helpful. Thank you.
Yeah. Thanks, Scott No just continued strong performance.
The one time revenue that.
That we have been recognizing it's only about 3% for the full year, you'll see that when we file our 10-K so.
It just strong performance and the quarter.
The next question is from Ryan Macwilliams with Stephens. Please go ahead.
Thanks for taking the question nice to hear about the sales force win and interesting. This came after sales force recently noted and a blog posts that they plan on more remote employees going forward.
And as enterprises move more remote and more distributed to Covid. That's a tailwind for your 2020 once the pipeline and is there any new products that existing <unk> clients can adopt to protect the remote workforce and even things like safety connection or enhance or et cetera.
Ryan Yes, thanks for the question and it's very insightful because.
Some of it.
Industry tailwind to what we do we've always talked about remote workers and fact.
And my standard and Investor deck, I was a little naive I think I had a stat and there that said by 2025, we'd have more than 70% of workers there'll be remote and on.
I think none of us realized that by 'twenty and 'twenty it would be like 99% because of Covid. So we've always built and architected our system around the fact that we protect everything you care about including all your people, even when they're not and headquarter. So safety connection was a product that was specifically built around supporting remote workers and.
Workers that are traveling workers wherever they are so we really build towards this our entire since the launch of C. M four or five years ago, and we think we're very well positioned to capitalize on the new normal of a much more geographically dispersed workforce.
Specific solutions safety connection being a big part of that.
We've continued to enhance our risk data now with over 22000 and data feeds including lots of hyper local data.
So you're really able to have good situational awareness keep track of anything you care about including remote workers and anything that's a possible threat and be able to have automated workflows and essentially and digitally transform the process to keep track of everybody. So it is a very important trend for us. It's the market has kind of come to where we've been all along and and were.
We're getting a lot of customers.
That are looking forward to.
Using our system as they as they evolve there and kind of work force and the future policies.
Great and I'm pleased to see Asps and step up again on the fourth quarter, you know anything to call out here and maybe more influenced by public warning or due to new versus existing customers and then how should we think about this trending into next fiscal year. Thanks.
Yeah. Thank you for that I think we talk about the basic formula that RCM wins are much bigger than our average wins and so this quarter. We had a all time record and the most C. M wins, we've ever had and we think that's an important driver of.
And I'm getting customers to do larger deal sizes with us So we continue to.
See the land and expand strategy that we talked about earlier this year is working well.
And where we're getting customers and the door quickly and then and then very rapidly cross selling and upselling them. So.
Every quarter. This year, we had really strong sales performance as it relates to what we call growth bookings, which is essentially a cross sell upsell. So.
And so that's pretty exciting and then our new logos. This quarter came in above the range that we say, we usually target. So so we're happy about that as well. Thank you.
The next question is from will power with Baird. Please go ahead.
Okay, Great Yeah, I guess, a couple of questions David.
Clear community benefits from the vaccine registration capabilities contact tracing.
Et cetera, and there's some new new.
New wins announced I.
And I Wonder if you could just talk about the revenue benefits from some of those initiatives versus perhaps just the broader exposure on the upper bridge suite of products.
Yeah, so the vaccine.
And I'm talking about that because I think what we've seen is sort of the power and the dynamic capability of our CGM platform.
You know coming into the year, we werent planning specifically for a global pandemic, but we're able to leverage the platform and with very powerful I think best in class.
Use cases technology around.
Contact tracing and returned to the office and and now.
And.
And vaccines and vaccine distribution, so with state of West Virginia, I think is the best example, they called us.
And.
Total sales cycle for that deal was 21 days.
They needed help and by the way that was the state of West Virginia. The leadership there has done amazing.
Across the board with this vaccine distribution and and.
We really respect the state leadership and West Virginia.
But they wanted additional help and so once they said go I think within a week or two weeks at the most we have the system up and running for the entire state of West, Virginia, and we have to be able to scale. It.
To handle big performance, because you know and this first couple of days I think we had something like a 150000 registrations hitting the system instead of coming and pretty fast.
So basically the system up a 100%.
And it turned up very quickly because that's what we need right now there's a tight window to hit.
And then the state of West Virginia on average.
Across the United States States have been getting about 53% of the doses into arms and West Virginia has been almost at 100%. So they are the number one state in terms of their efficiency and effectiveness and getting vaccines and and and we've been really honored to be able to support them on that.
And they're getting a lot of media coverage as well. So you know they've been on National Cable News Sunday Sunday shows and and we appreciate the had been very vocal on and mentioning us by name as part of their success, so and in terms of the deal sizes. We're doing are.
All different level sized deals. There are you know from Sarasota County in Florida, where I think we had 50000 registrations and the first hour and to the entire state of West Virginia.
Two other campuses and other types of customers, but west Virginia, I think it's I think it's been publicly stated our contract with <unk>.
Not.
And between 500000 and $1 million so that's a.
And that's a good contract compared to our normal ASP.
Yeah, that's great and that's a great use case and good luck.
And for everybody I guess, maybe trying to expand on that other states.
And I guess the second question look great to see the record number of C E M.
And anything you'd call out with respect to key drivers around that were there particular verticals you know.
Geographies.
Anything else you'd point to as really helping drive that record number.
Well, we had strength across all verticals and geographies in terms of Geos, it's worth mentioning that we did just launch.
And the second half of the year into Europe.
So we do have new geographies that are contributing and that weren't there before so we're excited to see the progress there, including some really amazing logos that we have on Siemens being the first big name that signed up with us as kind of our Tentpole CDM customer for Europe and.
And Siemens very respected and they've got a great leader there chiefs cured.
So and.
Broad strength across the board on CGM and I think just.
Stepping back the bigger picture is you know and and the middle of a global pandemic and as people start to think going forward. There is a recognition that many organizations, we're not as prepared as they should've been for an event like this and they know that they've got to be better prepared going forward. So we just are a very quick easy way.
You know where cloud base, we can get up and running quickly relative to other software investments you know, we're not that expensive and we represent and best practices and so I think there's a growing recognition of that and and just awareness that CMS is more of a must have been a nice to have.
The next question is from Tom Roderick with Stifel. Please go ahead.
Yeah, Hi, everybody's happy new year. Thanks for taking my questions I wanted to kind of dig into that and see.
Question, just a little bit more and I appreciate some of the commentary.
Regarding <unk> and go to market, particularly rounding out Europe and the second half of the year.
Yes, My question would be as you sort of look at the penetration rate, you're you're adding customers and a very nice clip yet to your point the penetration rate is still really quite low when you. When you mobilize a C M with the sales force, what's the strategy with hitting that installed base and driving that penetration rate higher.
Where do you think you can kind of take that number two as you look on it over the next year and maybe a better way to think about it is longer term what percentage of the installed base do you think you can move into <unk>.
Yes, Tom Thanks, good to hear your voice again.
So look we serve all verticals and I think all geographies need C. M. So.
So we believe ultimately we should be at 90% of the Fortune 1000, and a global 2000, and we're only in about a third right now so we see a lot of opportunity there.
On the cross sell up sell side and on average of our 10 software applications our customers only have about two right now so we've got.
Over 5600 customers, there's a lot of opportunity to upsell cross sell and we're seeing record high numbers of our newer strategic products as a percentage of our total bookings. So we're seeing the right trend there.
It's happened and the pandemic is.
Customers have very specific pain points and needs and so we're just building on them.
And continuing to add more software modules more use cases, once we get their data and our system. It's just very easy for them to turn on these use cases quickly.
And so we're just building inventory <unk> and.
And I gave some specific examples and then customers and then they go to the wholesale M suite and some cases go out a couple of pieces and build towards this gradually so.
And I don't know that we're forecasting a specific number for <unk> and next year, but I think to your point on the longer trend line is.
And we just think we're and like the second inning of this 900 and game and we're seeing more and more.
More and more people using our language talking about critical event management on.
And both customers and competitors and we just think that this is the maturation of this category, which Jamie.
Pioneered.
Five years ago, and and I think that was the rest of the industry starting to catch up to what we're doing.
Yeah, that's great and then just a follow up in terms of the you know the the <unk>.
Public warning wins, and and the international opportunity. It seems like that's been a little bit of a sort of a two pronged approach with with a shining and the value of the platform the software and be there there seems to be a little bit of a and installed hardware component that takes some time to displace you've talked a little bit about that with Australia, and maybe you could kind of give us some insights into.
How those two prongs are working as you look at other opportunities and and places, but particularly Europe and and they in the country wide opportunity. There. How is that progressing has the pipeline looking and and how do you kind of tackle part one versus you know part two which is the hardware and displacement.
Yes, Tom that's a great point and so just taking a step back public warning solution and there's really two parts to it.
One is the front and that we sell to the government that allows them to control all of the public warning across their population and all their visitors everyone on the country and.
And then the second piece of it is on the back and we have solutions that we sell into all the wireless carriers and our country and those deals can be two to three times and sometimes even more than what the government pays on the front and so they're all interconnected.
And then a little bit of that network effect and we talk about because if you get if you get all the carriers you have a lot of leverage and ultimately do more with the government and if you get the government it creates leverage with the carriers.
One of the Big things now I think.
<unk> out of our acquisition of one to many.
We are much better positioned to sell the carrier's first and then sell into the government, where I think historically, we were doing government first and then selling it as the carriers now we really can go by Directionally and I think that puts us on a very powerful position and were starting to see that with some of the wins, we had and the fourth quarter, which frankly came earlier than we expected because we are really.
Thinking most of these deals in Europe are going to come and the at the end of this year or the first half of 2022. So we're very happy about that and by the way for Q4, and we had a record number of public warning contract wins for our and addition of records and so.
And so that was a good good result.
Again, if you have a question. Please press Star then one.
The next question is from Matt Stotler with William Blair. Please go ahead.
Hey, guys. Thank you for taking my questions I guess just wanted to start off on the kind of the land and expand motion you talked about obviously kind of a shift and and adapting to the COVID-19 situation.
But obviously and it sounded like there there continues to be a lot of demand for your especially on your COVID-19 specific use cases so.
But love to get any sort of.
Ah metrics or color around contribution you're seeing whether revenue billings et cetera related to the COVID-19 specific use cases, but more importantly, what portion of those customers are you seeing adopt rapidly adopt additional solutions and.
Color there would be helpful.
Thank you, Matt Patrick do you want to take that one.
Yeah.
Well.
To date, we've seen.
Great adoption.
A lot of customers, who came to us for the Covid specific use cases.
By applying the software to other use cases, and then as a result as they do that they come back.
And they buy more products more contacts more usage.
And.
When we created the Covid shield products anything related to the pandemic. What we did is we.
And we pivoted quickly to repackage, what was already on the truck and and.
And we're just selling the platform and so when customers turn on the depending on what they purchased if they've got risk related information and they see the depth and the breath and the accuracy of that and how actionable and can be when we correlate that with the things that they care about they realize that they can use it for multiple use cases and and they start to do that because we help them.
And do it very efficiently and effectively so.
We've had contact tracing customers that turning into campus safety and security pretty quickly.
We've had COVID-19 shield customers, who start watching physical goods as they move around rather than just folks who are who are traveling and to.
It's a dangerous regions. So it's.
We're excited that those are.
And a relatively hot leads for continued expansion.
Thanks, Patrick that's helpful. And then just a quick follow up on the <unk>.
Partner relationships that Youre building, obviously, a really interesting area of investment you guys somewhere.
Still relatively early and in terms of building that out obviously soliris is big on last year at Soc, you mentioned and you.
Obviously, the early win there with California and.
Continuing to expand that.
So would love to I guess, just get a little more color around how youre thinking about the timeline for how these partnerships ramp and what kind of investments are enablement and remains to really drive success here. Thank you.
Yeah. Thanks, Matt as you know and you may remember I talked about increasing our routes to market through indirect channels and partnerships as a priority when I first joined and and as we've talked about with free cash flow you know and we.
Say, we're going to do something we do try to follow up and and fulfill our commitments. So.
Last year was really I think a foundational year, we signed some really good partnerships and it's just like anything else. When you get success. When you win a deal like state of California, which was a very large contracts both for auto and for ever bridge.
And both parties get excited and feel like let's go and do more of that and so now we've structured a much more strategic relationship.
Which is global in nature, which which includes a fairly significant seven figure.
Revenue and commitment per year, and so now we're building out the day.
And the scaffolding and both organizations, so where we can get their sales force and more fully trained and look at different integration points and ways that one plus one can equal three so we're having you know very very top level regular.
So the strategic.
And the steering committee meetings and I'm personally involved in and Jamie It's been very helpful and getting this partnership to a new level, but his relationships at auto. So we think that's a great model and.
We expect to see good success from that.
And Norfolk and controls is one where we had more of an opportunistic partnership with them and.
<unk> landed a very significant <unk> win at Cisco and.
And which we've talked about and the previous earnings call and I think both parties saw the potential to do more and now we've got a more.
More intentional.
Strategic and proactive structured and how we're going to go out and try to win more deals and.
And north and controls also this quarter and signed up to be.
Bigger customer of ours, as well and they're on right, which we thought was a great.
Demonstration of their commitments. So so we're excited we've got some other ones that we're working on that will probably be talking about later this year as well.
The next question is from Sterling Auty with J P. Morgan. Please go ahead.
Yeah. Thanks, Hi, guys I'm wondering if you could give us maybe a little bit of an update of what you're seeing in terms of use cases within more of the framework as opposed to some of the employee notification.
In both new purchases and maybe some expansion within existing customers.
Hi, Sterling, it's great to hear from you. Thank you for the question Yeah. So.
And we're really and enterprise wide operating system for the company and.
And to that and our relationship with the CIO organization is very important and we actually have seen we saw very rapid growth and both our bookings and revenues for our <unk> solution.
Last year.
And we had a good Q4 as well so that's been a real winner for us in terms of one of our solutions and in an area that is very core in terms of our ability to.
Really support the entire enterprise and in many cases allow the customer to.
Standardize on us and consolidate away from multiple other vendors or internal processes more manual processes. So we.
We think thats going very well and the use cases.
The cyber attacks are way up with the pandemic and the solar winds and so when a cyber attack brings you down and that's a critical event I T outages are very expensive and we've got some great references both customers and use cases for example, Lowe's and others, where they've made great use of our.
Iga solution help there as well so multiple different use cases, I'm really good positive ROI based use cases with good return on investment and an area of rapid growth for us and where we expect to see continued success.
Great. Thank you.
Thanks.
The next question is from Brian Peterson with Raymond James. Please go ahead.
Ah Congrats gentlemen, and thank you for taking the question. So I wanted to follow up on on Matt's earlier question on and our partner channel and.
David how would you define success from the partner channel either a longer term goal in terms of pipeline or bookings contribution and I realize you're going to get there this year, but maybe longer term how should we think about the evolution and how you would decline and success there.
Well, Brian and thank you.
As we said, it's an area of focus for us.
Trying to become the standard I mean, we want the audit committee of the board and to say are we are.
Are we PCI compliant or we sox compliant or we see them compliant and do more high reputation partners that we can get or they're in the C suite, having those conversations already doing a lot of work for these customers. It just helps us extend our reach particularly as we look at the international opportunity, which.
We see as being very significant for us so strategically and just beneficial for us to raise awareness getting more at bats, more opportunities into the funnel and we also find some of our largest deals come from these partner relationships. Our average deal size and these are very very good as well and we mentioned on the biggest contract we've ever one came through a partner.
And ship without us, so and defining success and passed.
Jobs I've come in where we had less than 5% and over a period of multiple years and been able to get that to you.
25% to 30% of bookings coming from indirect channels and partners.
And I don't know if that will happen here I think and we're just getting the flywheel spinning faster and faster every quarter and we're looking to grow.
And unique contribution in terms of direct partner deals as well as partner influenced deals and so just see that continue to grow every quarter and then you know how high can we get it but as I said and I've seen in the past, 25%, 30%, it's certainly possible, but we're not and it's not that we're not really banking on that we're not modeling around that that would be upside.
Great and we look forward to follow on that and it Patrick just maybe one for you.
You can't avoid the billings questions, but I'm just curious was there any impact on FX that you would call out on the revenue for the fourth quarter. Thanks, guys.
And nothing.
Material.
Certainly FX is part of the dynamic landscape.
And as we look out into 2021, but to date we.
And experienced anything that.
Notable enough to call out.
The next question is from Terry Tillman, which was securities. Please go ahead.
Hey, guys. This is Nick on for Terry Thanks for taking my question.
So just wanted to ask about the trajectory of customer adds going forward and it seems like you guys to be there and above or at the top end and the range.
You guys typically provide for a while now I was just wondering if you'd expect that to continue going forward and then as a follow up how the large deal pipeline looks as well. Thanks.
Nick Thanks for the question.
Yes.
Yes.
We don't expect to change the guidance on the new logo adds and when.
We do feel.
Confident that we'll be able to continue to perform as we have been or better in terms of the funnel.
As I think I mentioned earlier.
And looking at the funnel as we exited Q4.
More seven figure deals and I think I've seen at any point since I've been with the company.
We are seeing and we.
And again Q4, we had a record number of six figure deals. So it does feel like.
The return on the large deal, which we like to see.
The next question is from Brad Sills with Bank of America. Please go ahead.
Oh, Hey, guys. Thanks for taking my question I wanted to ask about the comments made earlier. Please on pent up demand, obviously, you're seeing success with Covid shield.
So the pandemic has been a tailwind there you mentioned some large deal activity, which sounds very healthy.
And I know you've seen some headwinds and other parts of the business and you're saying that there's some pent up demand here as you exit can you just help us understand what areas that might be that we might see accelerate as you as you exit the pandemic. Thank you so much.
Hey, Brad Thanks for the question, Yes, there are definitely well there are some use cases that.
And that we've emphasized during the pandemic there are significant and use cases that.
And we haven't been able to sell as much. So wanted to take just one example.
All of our sales people love to sell executive travel travel risk management.
And Thats just its a very intuitive fit with the broader E M.
And when you've got executives and people traveling all over the world and obviously that's been a use case, it's been much harder to sell since the pandemic and so we do expect as people start to travel more and that that returns on the northern part of business and that that will be one that we go back to selling more frequently. So we definitely have a list of use cases.
That we're looking forward to getting back and and selling more commonly as we were doing prior to the introduction of the pandemic.
The next question is from Bad and Shah with Credit Suisse. Please go ahead.
Great. Thanks for taking my question and congrats on the strong and to the year, David and nice to see some early returns on your C. M investments internationally, maybe can you elaborate on some areas of investments into 2021 any specific geos you're focused on.
Thank you for the comments and the question. So we're going to continue to expand internationally and try to take advantage of the network effects that we've seen and some of the large states like New York and Florida.
And California, where we win the statewide public warning and then we start to win all the entities and the state so.
On the public warning side now, we actually have one customers and every.
Major geography, and the world and so we've got customer Latin America Africa Middle East.
Asia, Oceana, and we've got more European countrywide customers and any other provider. So we.
We see opportunities wherever we went public warning deal and then go in and and a very intentional way accelerate the network effect adoption to drive additional deals and we're seeing it and places like Singapore right now so and the <unk>.
Last earnings call, we talked about the fact that we.
We've seen.
Nice deal flow in the Middle East, where historically, we haven't really done a lot of business and now I think we said we have over 60 customers and the middle East. So we just think it's a global problem that needs a solution like what we're doing with <unk> and it's just and it's just a matter of getting more distribution into these areas. So we can take advantage of the opportunity.
The next question is from Mike Latimore with Northland Capital markets. Please go ahead.
Yeah, Thanks very much.
I guess in terms of the European Union opportunities for public warning systems.
It sounds like you're sticking.
And sticking with the same kind of timeframe in terms of rfps and announcements and so forth, but I guess any sense of whether things are shifting a little bit you talked about U K here.
I don't know.
Is there anything and any sort of pulled it and let's say and the public warning arena for the EU.
Thanks, Mike for the question so.
Yeah, we are seeing.
Being some.
Signs of Rfps coming and so we're starting to see some movement.
And we're not seeing things, where we feel like.
We would change what we've been saying all along which is in terms of actually getting and RFID and an RFP and making a selection implementing the solution. I mean, we still think from a revenue perspective, you're talking about first half of 'twenty and 'twenty. Two maybe the end of 2021, but are we seeing more signs of activity, yes, we definitely are and and and.
Clearly Q4, we had more wins most wins, we've ever had and a quarter from public warning. So so I think we're seeing signs of life, but again not so much that we would change our what we've been telling people about the timing and revenue.
Great and then on the crawl and win.
I think I'm pronouncing that correctly.
Was that government and mobile network operators. There and then also did you benefit from some network effect, having been in India already for that one.
Yes, Patrick do you want to talk about corolla.
And with both.
And we want the front end and then.
Given that we already have network connections and the country and India, we were able to leverage those to win.
And back and opportunities for that state as well so yes, we do see that.
And that's sort of a domino effect continuing to work force.
Due to time constraints. This concludes our question and answer session I would like to turn the conference back over to David Meredith for any closing remarks.
Well, thank you for joining our call today.
We delivered a strong financial performance and 2020 in the midst of the COVID-19 pandemic, increasing our top line guidance every quarter and delivering 35% revenue growth for the year.
We hope to see some of you on the upcoming Raymond James Institutional growth conference on March 2nd and the meantime, Thank you for your interest and good night.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Yeah.
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