Q4 2020 Bandwidth Inc Earnings Call
[music].
Thank you for standing by this is the conference operator, welcome to the bandwidth fourth quarter 2020 earnings call.
As a reminder, all participants in a listen only mode and the conference is being recorded.
After the presentation, there will be an opportunity to ask questions.
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I would now like to turn the conference over to Sarah Wallace.
This precedent of Investor Relations. Please go ahead.
Thank you good afternoon, and welcome to bandwidth fourth quarter 'twenty 'twenty earnings call today, we'll be discussing the results announced in our press release issued after the market close.
With me on the call. This afternoon is David Morken bandwidth, Chief Executive Officer, and Jeff Hoffman, Chief Financial Officer of bandwidth. They will begin with prepared remarks, and then we will open up the call for Q&A.
During the call we will make statements related to our business that may be considered forward looking including statements concerning our financial guidance for the first fiscal quarter and full year of 'twenty 'twenty, one and to the extent provided future periods. The statements regarding the expected benefits of the box the one acquisition.
And our expectations around the impact of the COVID-19 pandemic on our business.
Forward looking statements may often be identified with words, such as we expect we anticipate or upcoming these statements reflect our views only as of today and should not be considered our views as of any subsequent date.
We undertake no obligation to update or revise these forward looking statements for.
We're looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties that could cause the actual results to differ materially from our expectations.
For a discussion of material risks and other important factors that could affect our actual results. Please refer to those contained in our latest 10-K filing as updated by other SEC filings all of which are available on the Investor Relations section of our website at bandwidth dot com and on the edge.
He sees website at S E C dot Gov.
During the course of today's call, we will refer to certain non-GAAP financial measures a reconciliation of GAAP to non-GAAP measures is included in our press release issued after the close of market today, which is located on our website at investors thought bandwidth dotcom.
With that let me turn the call over to David.
Thank you Sarah and thank you to everyone joining us today.
Were thrilled to share our 'twenty 'twenty results and talk about what's ahead.
As we reflect on the past year I, Thank god for leading us through so many storms and pray for our team their families and for all of those whose lives are impacted by the global pandemic.
Before we discuss our 'twenty 'twenty results I want to take a minute to remember where we word nearly one year ago as the world was shutting down around us our team gathered for what remains the last time, we were altogether in one room.
None of us knew what the next weeks or months would bring only that it would be unlike anything we'd lived through before we resolved the no matter what unfolded, we would be steadfast in resolute in serving our customers out of loving each other the.
This team delivered on that charge over and over and over again I am humbled by our Bandmates commitment to our mission of especially of so many of them and their families navigate a great personal adversity to all of the Bandmates listening today. Thank you your work fueled the success I know.
Of the honor to share.
And that success includes a record 51% annual C pass revenue growth year over year and 84 per cent. She pass revenue growth in Q4, both demonstrating accelerating broad based demand for our software powered solutions.
We deepened and strengthened our existing customer relationships as evidenced by an all time high dollar based net retention rate of 131 per cent for the full year.
We are gratified that in 'twenty 'twenty, we achieved these record results, while staying true to our principle of responsible growth, which balances top and bottom lines early last year, we announced our plans to accelerate by a full year a return to positive non-GAAP net income and are proud we delivered on that commitment in 2020.
In the face of extraordinary events, we remain committed to growing steadily and consistently not just quarter over quarter or year over year, but decade over a decade.
In a few minutes, Jeff will walk through the full financial picture of what this team accomplished in 2020, but before he does I'd like to discuss the broader impact of what we achieved in the ways. Our work this past year positions us for success globally in the years to come.
The pandemic forced us not just to work from home, but to learn from home to teach from home to worship from home the exercise at home Love, our friends and family from home and innovate and build from home to enable the tools and platforms that make this modern work and life reality today parcel.
<unk> enterprises everywhere are looking to the cloud.
The pandemic made clear something that we have bandwidth already new communications are no longer merely of service measured by minutes of messages today's businesses demand communication solutions provided as part of our dynamic platform, allowing for integration with adjacent applications exponential scale and other.
Unfettered creativity and flexibility.
70% of company's day, the pandemic has accelerated their shift to the cloud they seek the extraordinary efficiency economic advantage and enhanced innovation made possible by cloud based communication solutions, but it is no small task to break free of antiquated premise based analog telecom infrastructure.
Companies around the globe need the right partner to help them tackle the myriad of technical and regulatory challenges that come with migrating their communications to the cloud.
These challenges put into sharp focus precisely why we believe bandwidth is the preferred cloud communications provider for Tech Giants and enterprises alike. First we provide a software platform rich with AP is automation and analytics second we operate our own.
IP voice network that provides world class quality at scale.
We proved this when we were able to rapidly scale of the network to keep pace with the 30 per cent surge in Concord Kohl's caused by Lockdowns. The last March 3rd we offer world class support collectively the bandwidth team have centurys worth of deep expertise in software voice and messaging and <unk>.
We put this expertise to work providing solutions to our customers' most difficult communication challenges.
Like to give a few recent examples of how the bandwidth software platform and network have delivered quality automation of and support to our customers.
We have previously highlighted of five year multimillion dollar relationship with the Fortune 500 company that offers communications and technology solutions for residential small business and enterprise customers across the U S.
Under the terms of the agreement this existing customer uses bandwidth she passed platform and nationwide voice network to expand the engagement and collaboration services offered to its enterprise customers I'm proud to report today that this customer is now all in with bandwidth and is utilizing services across our entire platform after moving.
Its end users to bandwidth of emergency services as well the customers of massive customer base drove increased usage of toll free and local calling messaging traffic and 911 enabled phone numbers. In 2020. This use case is a great example of our ability to build trust and scale, our full suite of services at whatever pay.
The customer requires to meet its cloud communications needs.
During the fourth quarter and throughout 2020, we found continued success in serving cloud based contact centers. Our platform is being used to enable incredible end user experiences in this critical segment, both by sea cash providers and by enterprises, we work with directly.
This year, we significantly expanded our relationship with the long standing customer who provides a cloud based contact center platform and worked with established mid size market leaders to help them create transformative customer experiences utilizing voice chat and text. We've partnered with this customer to develop and bring new server.
This is the market gaining their trust and becoming their primary voice provider their trust in us and the decision to go all in with bandwidth resulted in a doubling of the scope of our relationship over the past year, they've chosen to expand with us over the years because of our exceptional customer service and intuitive portal to manage number porting and all.
<unk> aspects of their account.
In the fourth quarter, we also signed the deal with one of the fastest growing providers of cloud contact Center software. This company headquartered in the U S is the first and only cloud contact center platform for the smartphone era of customer experience that delivers global support.
The company powers, the world's largest elastic see cash tenant and is trusted by innovative customer centric enterprises. The company selected bandwidth to power their contact center platform and currently uses inbound calling across more than a dozen countries primarily in Europe with plans of expanding to additional.
The countries and activating outbound calling.
All of these because of our reputation for coal quality and ability to scale.
Bandwidth is not just powering see cash providers. However, our platform is also used by enterprises, who leverage our platform directly in order to scale their own large cloud based global contact centers and other communications needs.
In the fourth quarter, we welcomed to our platform a large pharmaceutical company with operations in 90 countries. This company is in the process of overhauling its entire communications suite as part of its migration to the cloud. This company chose bandwidth to power of internal communications as well as inbound and outbound.
Calling for their customer contact center in a dozen countries.
Before I turn things over to Jeff I want to update you on the integration efforts following our acquisition of box bow in the last quarter as many of you know with the box bone acquisition bandwidth expanded its reach to more than 60 countries that represent 93 per cent of the world's GDP.
And with the ambition is nothing less than to be the world's dominant cloud communications provider and the vocs bone acquisition means we are uniquely positioned to serve the world's most innovative companies with global communications solutions instead.
Instead of Cobbling together agreements with multiple providers around the globe for peace meal solutions enterprises will be able to get reliable compliant flexible solutions on a global scale from one source bandwidth.
Our existing customers are ecstatic that we will be able to offer them global business voice solutions with the care and collaboration that they've come to expect from the bandwidth team and.
And we are hearing from new prospects every day, who are clamoring to learn how a truly global platform can help them develop launch and hyperscale their applications and customer experiences the energy and enthusiasm from customers and prospects around the world confirms our acquisition thesis.
We are hard at work to bring these transformational benefits to our customers as quickly as possible guided by the superb leadership of our integration team. We've made steady progress our combined financial and legal teams have been working tirelessly in an effort to ensure the smooth transition of regulatory approvals and complete combined company financial reporting.
Our sales teams are taking advantage of opportunities to expand customer relationships by cross selling and up selling.
We've got a massive sales enablement effort underway to ensure that we're pursuing global opportunities in the coherent coordinated way and to make the most of the incredible opportunities within reach.
There is much work to be done as we seek to bring the absolute best of the bandwidth and Vox bone products services and customer experiences together in a unified global offering.
We are so excited for the new and bigger ways, our combined company will be able to serve our customers around the world.
We're doing this on top of our mission to serve our customers and improve our offerings of day in and out.
Additionally, we began offering local phone numbers in Hong Kong and enabled toll free number porting in Switzerland. We also enabled the full stack services in Cyprus paving the way for us to be the only provider offering full two way of cloud based voice services across the European Union. Each of these is an important step in our efforts to be the.
World's only one stop shop for global Cloud Communications and of course, we're doing the joy for work of creating one team for them to our unique bandwidth culture has been the not so secret ingredient of our success for two decades, we are eagerly sharing that culture with our new band mates and they are generously enriching.
For us with their global perspective, and with new traditions that we're adopting as our own even though we still can't be together in person the chemistry between our new Bandmates as unmistakable weird bandwidth had been watching and admiring the work of the vocs bone team for years, it's amazing to see these two teams now rolled up their sleeves and <unk>.
Got to work together to unlock our full potential.
Never seen of more energized group and I'm confident that the chapter we're writing now will be bandwidth best one yet.
We look to 'twenty, 'twenty, one and beyond with enormous optimism and the courage of our convictions bandwidth the opportunity to develop and deliver the power of the communicate globally is larger and more important now than ever before with that I'll turn it over to Jeff.
Thank you David and good afternoon, everyone.
We are humbled that our mission is rooted in connecting one another during these challenging times and I couldn't be more proud of our team for delivering extraordinary results in the fourth quarter that capped off an exceptional 2020 performance.
As we discuss our financial results I want to remind everyone that we closed the box bone acquisition during the quarter. So we have two months of box volume contribution in the fourth quarter and full year 2020 results.
The fourth quarter total revenue was $113 million up 82% year over year within total revenue C. Pass revenue was $98 1 million up 84% year over year. Other revenue contributed the remaining $14 9 million of total revenue, which was up 74% from the same period of year.
Ara go.
Fox bone contributed approximately 17 million.
To see pass revenue in the quarter, which was $4 million better than anticipated. The positive variance was primarily driven by a large customer testing a new offering at scale that contributed to our fourth quarter results and is expected to return to a more normal spending pattern in Q1.
Excluding the box bone bandwidth Standalone C pass fourth quarter year over year revenue growth was 53% our growth was driven by the broad based fundamental strength in our business and amplified by two factors first political messaging contributed more than $8 million the fourth quarter C pass revenue.
Second COVID-19 related tailwind, which continued to decline sequentially in the fourth quarter contributed approximately $2 million to see pass revenue combined political messaging and Covid related usage added 19 points to our fourth quarter year over year growth rate.
Please note that going forward, we will no longer break out COVID-19 related impacts, which over time have become less meaningful to our results and increasingly difficult to differentiate from organic growth on our platform.
We believe the hybrid work environment is the new norm and we will continue to benefit our business for years to come.
Rounding out the top line bandwidth Standalone contribution to other revenue was $14 million yielding of growth rate of 63% in the fourth quarter box bone contributed just under $1 million to other revenue in the period, which was inline with expectations we.
We achieved a 133% dollar based net retention in the corner.
Strong evidence of our ability to drive deeper and more meaningful relationships with our customers like those David highlighted in his comments.
Keep in mind that this metric will not be impacted by box bone until we hit the acquisition closing anniversary in the fourth quarter of 2021.
We ended the fourth quarter with 2848 active <unk> customer accounts, Inc.
The net addition of 109 customer accounts in the quarter and more than 700, new box for one customer accounts.
Non-GAAP gross margins came in at 49% for the quarter for.
<unk> Standalone C pass margins continued their upward trend and was further enhanced by the inclusion of higher margin box bone.
However, these positive factors continue to be partially offset by higher carrier SMS surcharges, which we pass through to our customers. The same dynamics are expected to continue going forward with C pass margin continuing to expand including the lift from the Fox phone business, but we also anticipate that other carriers may add MEH.
<unk> surcharges in 2021 that could create further potential drag on our overall gross margin.
Consistent with our commitment to balancing top line growth with profitability our business delivered non-GAAP net income in the fourth quarter of $3 5 million or <unk> 13 per share based on 27 2 million weighted average diluted shares outstanding.
Moving onto the full year 2020 highlights.
Total revenue was $343 1 million up 48 per cent year over year.
Within total revenue <unk> revenue was $298 1 million up 51% year over year.
Delivering on our commitment to pull forward profitability by one year into 2020 non-GAAP net income came in at $14 2 million or <unk> 55 per share based on $25 9 million weighted average diluted shares outstanding.
Now I'd like to outline our financial outlook for 2021.
In terms of C pass revenue, we expect the full year of 2021, including box bone to be in the range of $413 million to $417 million or up 39% at the midpoint of the range. We expect 2021 total revenue to be in the range of 460 to 464 million.
<unk> up 35% at the midpoint of the range.
Our annual guidance builds on the success, we achieved last year, excluding $23 million of C pass revenue tailwind, which include $12 million of political messaging traffic and $11 million of Covid related usage.
While our guidance assumes continued investment in our people and systems to fuel our future growth, we remain dedicated to our commitment to profitable growth in 2021, and accordingly have forecasted positive non-GAAP net income for the year.
These 2021 investments include hiring across the combined company to support growth and innovation expand the scale and reach of our global platform as well as the integration of the recently acquired box phone business.
We are estimating our full year non-GAAP earnings per share to be in the range of <unk> to 12 <unk>.
Based on approximately $27 5 million weighted average diluted shares outstanding.
Turning to our guidance for the first quarter of 2021, we expect C pass revenue, including box zone to be in the range of 96 six.
The $97 6 million were up 64% year over year at the midpoint of the range.
This contributes to our total revenue guidance of $108 million to $109 million or up 58% year over year at the midpoint of the range.
Moving on to the first quarter 2021 profitability non-GAAP earnings per share is expected to be in the range of zero to <unk> <unk> per share. This outlook assumes weighted average diluted shares outstanding of approximately $27 5 million.
In conclusion, we are very pleased with our 2020 performance and are excited about the opportunity ahead of us in 2021 of them beyond our business fundamentals are strong and bandwidth continues to be well positioned to capture the large and expanding <unk> market opportunity around the world as enterprises increasingly embed.
Communications into their products and services to deliver mission critical connected experiences.
With that I'll turn the call back to the operator for Q&A.
Thank you we will now begin the question and answer session. The joined the question queue. You May Press Star then one on your telephone keypad, you will hear of tone of knowledge in your request.
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Okay.
Our first question is from Patrick of Wild Robinson with JMP. Please go ahead.
Oh, great. Thank you and congratulations as well so David can I ask you a question about.
The sort of your philosophy about.
Returning to work and working from home and maintaining your culture.
As hopefully the pandemic eases here and then also what you're seeing from all of the companies you're talking to and how you think that plays out for your business.
Hey, Pat Great to hear from you and look forward to being together in person some time hopefully soon.
Yes, no question.
Yeah, hopefully praying for that I, Here's our philosophy in my view on work in general and leading you can follow from home.
All the time.
Bleeding is an in person dynamic and culture.
As an in person dynamics of work convinced in and focused on a full return to an in person culture I know that's quite different from some of Silicon Valley companies, who are declaring that folks never will return.
Think that flies in the face of millennia of human experience.
Yeah.
I actually feel like people are walking that back for what it's worth.
And are you.
I'm curious, what's your what you're hearing from customers.
So all of that.
You bet I think from our customers what we understand is the new methods of engagement learned during the season.
Our instrumental going forward, even as folks either return or choose not to return what won't happen is the the new arrows and everyone's quiver to engage customers and cultivate relationships those are gonna be.
<unk> and continue to be used in the future. We learned of lots of new use cases, and many of those will continue even as many of us return to in person.
Okay, and then Jeff just on that subject how should investors think about it in terms of what's in your guidance.
So I think we have Pat.
Built in to the extent, we can distinguish it of COVID-19 benefit but it is we had said in our prepared remarks is getting harder to distinguish from organic growth now almost a year into the pandemic and so it is built in we wont be separating it out.
Going forward, but.
Agree with what David said I think they are to some extent the hybrid work environment is the new norm and our business will benefit from that.
Great. Thank you both.
Thanks Pat.
Okay.
Our next question is from Bhavan Suri with William Blair. Please go ahead.
Hey, gentlemen, good could you even hear your voices and the electro Pat just great results.
I just wanted to touch first of all the competitive landscape a little bit.
Obviously, great great results out there, but the we've heard sort of network owners like Telmex and telecom are targeting multi sourcing opportunities from your customers you know overall claim you.
You seem to be gaining market share I guess the question I have is have you seen any change in behavior of market presence from these types of providers at all.
And sort of even though even with that some of the consolidation of acquisition stuff like since you announced their intention to buy in the space and any change of competitor behavior of anything can be sorts of providers.
Hey, Bill of on Great to talk to you as well.
We are very familiar with our competitors and don't see any fundamental change or shift in the marketplace.
Other than the fact that we singularly and uniquely have now been able to address the entire world on behalf of U S. Headquartered companies enterprises large tech no one else on the competitive field has that worldwide footprint of network and platform in the way that we do.
And that is a distinguishing characteristic of our strategy and addresses a much larger marketplace and so that's been the real change its a change that we initiated.
Gotcha Gotcha Gotcha, and then I do want to drill a little bit ends of box bone and maybe it's just the question for both of you here.
But obviously, you're really nice upside there I guess, how is cross sell go you touched a little bit on the on the sort of broader Congress, but lots of sand how is it going vis vis your expectations and then really on gross margin you know Blackstone had nice sort of much of nice or nicer of gross margin number with that and how do you think that plays out given sort of you know what what seems to me.
At least.
Better growth that maybe we had anticipated and how the different gross margin through 2021 less day.
But to my expectations with both of anybody else's, but help help us walk through those two pieces, but both the cross sell vis vis expectations of the expansion there what you seem to be seeing and then the gross margin flow through of an impact through 2021.
You bet the von <unk>.
Only about five of the top 20 customers of each company were shared and that's important because of the cross sell opportunity is robust the chance to go into the customer basis of each company and provide the portfolio of product in new jurisdictions or in new capabilities is rich and so we've got great integration.
Leadership identifying sales leaders who are on point.
With each of the largest customers broader than just the top 20, so of the cross sell opportunity is manifest to us and we're attacking it I think with good vigilance and then I'll ask Jeff to answer the other part of your question sure glad too. So I think the a lot of the dynamics that we saw in fourth quarter are going to play out.
In 'twenty, one as well and what I mean by that is we expect see past margins continue to grow they will be aided as you pointed out by box bone who comes in with accretive gross margins, but there's interplay still with as you know we've had a lot of success with messaging and with messaging oftentimes comes more SMS surcharges.
Which we're passing through to our customers, which actually compresses our margin. So I think net net we should see an uptick in our margins in 'twenty one as we continue our climb to our long term goal of 60%.
But there is some interplay there that I want to make sure everyone understands.
Great No I think that's helpful. Thanks for the candor and the color Jim.
I'll jump back in queue. Thank you.
Thanks for fun.
Our next question is from Alex Kurtz with Keybanc capital markets. Please go ahead.
Yes, good to hear from you guys and thanks for taking a couple of questions. Just on that last question on the last statement, Jeff on on gross margin.
Is it fair to say that box bone.
Is growing faster than your messaging business too. So when we think about the longer term driver rate that is of higher margin outcome.
It should be additive to blend.
Blended gross margins should be.
The increasing over time, just so the the interplay between messaging growth versus the box bone growth.
Sure. So I think Thats right net net I think the positive factors of the expansion and C pass margins and the addition of Vocs bone the tire margin will overplay Ah the what we're seeing on the on the SMS surcharge side. So I think you've got that right.
Okay and then just on this plan at the end I appreciate.
All the detail about what you think the Covid impact is to your business, but.
And I'm sure we're all pushing for it at the time, including myself back in the back in the spring but.
Okay.
How can you really understand what the baseline is above what your customers were doing right I mean, it's kind of a.
You know.
Youre, adding your end customers or adding new <unk> customers.
Our customers are adding new see cash customers. So.
Is it.
This concept that you had $11 million of Covid tailwind.
How strongly do you feel that number is really high.
The right estimate because one could argue that there's a lot of other factors that there could be expansion on on top of the customers that you added in 2020.
I think that the Fairpoint, Alex and Thats part of the way you're right when when the pandemic hit and everyone sort of rush to work from home outside the office it was pretty clear to us what the Covid impact was because you saw growth trend spike and that Spike is how we knew that was COVID-19 related but as if we've advanced on each.
Warner using sort of that same methodology, we saw a peak in second quarter, and then b become become start to come down and it has each sequential quarter. So its become one less meaningful but to harder to differentiate your group good point, and what's temporary and what's permanent and.
That's part of why we won't be reporting of Covid breakout going forward, but wanted to finish the year in terms of your specific question on the $11 million, we feel pretty strong about that most most of that estimate came in the first half of of 2020, and that's where we thought we had really good good visibility.
Okay that makes sense. Thank you.
Our next question is from meta Marshall with Morgan Stanley. Please go ahead.
Okay, great Thanks, and congrats.
Just a couple of of question, maybe just an update on kind of the Microsoft teams direct routing and E 911 opportunity and kind of what you're seeing there and then just maybe an updated split of the business. So maybe how much of you know messaging composes of.
The business at this point versus may be voice versus the 911, and if you could just break out what the ADP charges line.
Surcharges, where more specifically this quarter. Thanks.
Neither of the Microsoft teams do at product was something that we launched is really a pioneer in the space. Among the very first to do direct routing with the Ucas solution like Microsoft teams, what's been incredibly gratifying since is the interest and the progress among other.
Ucas platforms that are eager to integrate with bandwidth to do at product and while we don't have any specific announcements that we're making now to your point on what has been the direct routing response in the space what's been the progress. It is exciting to see that there are other platforms that are doing collaboration.
And that are wanting to utilize our duet product when we launched it with teams we weren't certain that would be the case, but we believe that the direct routing future and the platform that we have that powers. Microsoft teams today will power of others in the future.
And then I'll take the part on kind of the split of the business as you were asking meter.
Just recall box bone is 100% voice.
So despite all of the success, we've had in the Covid fourth quarter with political messaging.
Messaging was 18% of C pass revenue if you normalized for political messaging.
We'd be at nine, 9%, which is probably a better way to sort of think about it.
Going forward in terms of the ADP charges, they were approximately $6 million in the quarter and 11 million for the year. What the reason that we saw it higher in the fourth quarter was related to the Spike we saw in political messaging usage in particular as we ran up to the.
<unk> U S elections.
Got it thanks, so much growth.
Our next question is from will power with Baird. Please go ahead.
Hey, guys. Thanks for taking the question this is actually Charlie or other gone for a well congrats on the really strong results.
So I was hoping just for some more information on maybe some upside drivers in the quarter. I mean, you had such a strong quarter. So.
Just wondering it sounded like contact center was a nice driver, but is there anything else that you would call out, though is maybe better than expected going into the quarter.
So I'll start and then David welcome to come in it was really a strong performance across the board. We posted of dollar based net retention of 133%. So obviously, our existing customers are trusting us and growing more and we're deepening those relations, but we're also continuing to attract and scale.
Customers know the things that really amplified the results that we called out in our prepared remarks, the political messaging volumes were much higher.
Covid contributed about $2 million as we said based on the methodology, but across the board just a great performance.
Yeah.
Great. Thanks very much.
Mhm.
Our next question is from rich Valera with Needham. Please go ahead.
Okay.
Thank you and let me add my congrats on the strong results.
And the the DB and are very strong for the quarter of $1 33, just wondering if you can for.
How we should think about that going forward I know you don't guide to it but.
If you think that was sort of affected by any temporary factors and just.
Again, how we should maybe think about that number going forward. Thanks.
Yes, so its certainly rich was impacted if you normalize for that political messaging increase in Covid. The $1 33 dollar based net retention would normalize to 125% it gets a little bit more tricky in 'twenty. One did it is because as you know how we've always guided our analysts and <unk>.
<unk> is look at our C past gross percentage, making assumption on new logo growth based on what we've trended in the past and you kind of back into a dollar based net retention since the DB and D V and our our will only be for the bandwidth standalone business that won't work quite as well in 2021.
Until we lap the anniversary of the box bone close.
Got it that's helpful. Jeff Thanks, and then for.
For the year in general.
Are you willing to say what percentage of you think is going to come from box volume the sense of the relative contribution of vocs phone versus the the.
The original business.
We're not going to break out guidance between the two business. We're actively trying to take those two businesses and turn them into one however, just like we did in fourth quarter each quarter for the next year, we'll give you that Fox bone contribution. So that you have that when we report our result.
That's great and just final one on contact center it.
It seems like you had.
A nice amount of activity of kind of new contact center activity.
Anything to that.
Curious, if there's a trend there or what youre seeing but behind that thanks.
You bet. It has been a segment that we have focused on in the past in our pipeline that we are building and have been clear about that in the future and are as excited as ever with these most recently announced results providing some of the evidence of what's possible in that segment for the platform and network that we have especially now that.
Were international and around the world. It just opens up an entirely new set of customers that have international contact center requirements.
Sure makes sense, thanks, gentlemen.
Thank you.
Our next question is from Mike Walkley with Canaccord Genuity. Please go ahead.
Great.
Thanks, taking my question.
Congrats also on the great results and hope everybody is healthy on the call.
Just wanted to focus a little more on box zone, and the cross sell opportunities.
Taking some of the north American customers onto their network is especially with the those 15 large customers that don't overlap how long does it take maybe two of them out internationally and how much cross sell if any is included in your guidance for that is that the potential upside driver out of the year plays out.
So we have factored aspects like cross sell upsell into our guidance.
Some of these opportunities take longer than others to integrate and rollout into jurisdictions.
But that said our original international thesis was entirely driven by existing customers, who at the time that we began building internationally had.
Significant spend for existing product and service outside of the United States box bone accelerated our ability to serve those existing customers tremendously.
And we are focused on serving those customers in these new markets and are identifying where the box Bon platform can do that more quickly for some than others, but haven't guided specifically and the average on ramp of Onboarding timeframe. During 'twenty, one within which we would expect those 15 to come on.
Great. That's helpful. And then just on the investments how is the hiring opportunity out there.
Whats kind of maybe the pace of of adding the new head count the plan for 'twenty one thank you.
You bet.
We're focused on reinforcing success in marketing and in sales domestically and globally and we will continue to invest responsibly of balancing again, the top line growth with a real bottom line sensibility on non-GAAP net income, but keenly focused on where we see opportunity and where.
We have good new product initiatives that we think of yield.
In line with our long term strategy will continue to invest.
Okay.
That's the that's left for successful year.
Thank you very much you as well.
This concludes the question and answer session and today's conference call. You may disconnect. Your lines. Thank you for participating and have a pleasant day.
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