Q2 2021 Brightcove Inc Earnings Call
Greetings and welcome to the Brightcove second quarter of 2021 earnings call at.
At this time all participants are in a listen only mode of quest.
And answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad. Please note. This conference is being recorded and I'll now turn the conference over to your host Brian <unk> from ICR you may begin.
Good.
And loving of Brightcove second quarter, 2020.1 earnings call.
And so they live and discuss the results announced in our press release issued after market close with me on the call are Jeff Ray Brightcove, Chief Executive Officer, and Rob Dark Brightcove Chief Financial Officer.
During the call we will make statements related to our business and maybe considered forward looking and are made pursuant.
After the safe Harbor provisions of the <unk>.
And Securities Litigation Reform Act of 995.
Including statements concerning our financial guidance for the third fiscal quarter of 2021, and the full year 2020.1.
Expected profitability and positive free cash flow, our position and execute on our go to market and growth strategy.
And to expand.
And to position, our ability to maintain and upsell existing customers as well as our ability to acquire new customers.
Forward looking statements may often be identified with words, such as we expect we anticipate upcoming for similar indications of future expectations. These.
Statements reflect our views only as of today and should not be reflected upon as representing our.
Our leadership of any subsequent date.
These statements are subject to a variety of risks and uncertainties and uncertainties that could cause actual results to differ materially from expectations.
And then the effect of the COVID-19 pandemic on our business operations as well as the impact on general economic and financial market conditions.
For a discussion of material risks and other important.
Factors that could affect our actual results.
Please refer to those contained in our most recently filed annual report on form 10-K and.
And as updated by our other SEC filings.
Also during the course of today's call, we will refer to certain non-GAAP financial measures.
There is a reconciliation schedule showing GAAP versus non-GAAP results currently available on our press release issued.
After market close today, which can be found on our website at www Dot Brightcove dot com.
In terms of the agenda for today's call, Jeff will provide a summary review of our financial results and update on our operations and a review of our strategy.
Rob will of into additional details regarding our second quarter of 2021 results and.
All of our outlook for the third quarter and full.
Year 2021.
With that let me turn the call over to Josh.
Thanks, Brian and thank you to everyone for joining today I Hope you and your families are enjoying a safe and healthy summer.
Our customers continue to demonstrate that video remains the most powerful medium to connect with their audiences.
And as many global organizations begin to plan for hybrid working environments, we see the opportunity to empower them to communicate educate motivate and inspire their teams across a variety of industry sectors.
We are also ready to serve the needs of marketers as they are presented with the challenge.
To optimize all of video content across a variety of activities both in person and virtual and we are so proud to continue to deliver solutions to media companies that are enabling greater reach and monetization of content across various engagement models.
So with that let's get to.
Adults for the second quarter revenue was $51.5 million up 7% year over year.
And adjusted EBITDA was $5.6 million up 33% year over year.
We delivered a solid financial performance this quarter and exceeded.
To our end of guidance as we have discussed in previous earnings calls, we continue to focus on 4 strategic areas to drive the business forward.
First and foremost customer success and retention.
Our continued investment and innovation to satisfy the growing demand for video and delivering.
Delivering comprehensive video solutions for use cases across multiple industries third leveraging the success, we have seen in our direct sales effort and fourth accelerating the growth of our indirect channel.
Each of these focus areas of dedicated experienced team with clear.
Execution goals. We are ahead of our plan and implementing all of the necessary changes to our renewals business with people processes and systems now in place. It will take the next 2 to 3 quarters to fully realize the benefit of these changes with our particular focus on increasing retention.
With our media customers. We know we have in place all of the elements needed to deliver on our long term financial targets of 20% revenue growth and 20% plus adjusted EBITDA margins.
We have the best video platform in the world and of product development team that is.
Better and more quickly than ever before.
We have 64% more engineering head count than we did 3 years ago and are reallocating. These resources to deliver new products had record pace.
Our go to market team is making progress winning business and.
Pending existing customers for example, and our Asia Pacific and Japan regions had amazing year on year growth of 30% and 50% respectively to continue this momentum and realize our full go to market potential. We will also be making significant investments in sales and marketing and.
The second half of these investments will put us and the best possible position to further accelerate growth as we complete our retention improvement efforts.
Let me take a moment to describe what we did and the last quarter for each of our growth strategy areas, starting with renewals and customer success.
TB and Zed is of New Zealand state owned commercially funded broadcaster and its been of Brightcove customer for 10 years as their renewal approached we knew we needed to express to TVN and the importance of their business and our commitment to media organizations using our new.
Customer retention approach TVN said signed a renewal for 2 years of <unk>.
First for this customer.
Could not be more proud of the actions, we took and the end result.
We rolled out of new comprehensive customer Onboarding program, including new training tools education.
<unk> modules and direct access to expert resources, we have received overwhelmingly positive feedback from customers on the program as.
As an example, the Scottish courts and tribunals shared feedback on its recent on boarding experience, stating that quote Brightcove Onboarding program.
<unk> been excellent and the level of service responsiveness and attention to detail is first class. Please keep up the good work and quote.
We invested and new tools, allowing us to better track customer activity and help.
With this data we can ensure all customers are positioned to succeed.
<unk> has been addition, we've hired new employees dedicated to customer success and have plans to add additional head count throughout 2021.
Within the quarter, we've seen a number of customer renewals with major revenue growth, which we believe are early indicators that our customer success efforts are working.
Softbank is of Japanese multinational conglomerate that is deeply ingrained brightcove powered video communication and its strategy.
Under our recently expanded relationship we will now work together to livestream professional Japanese baseball games to fans hydro does for rowers.
And what peloton does for indoor cyclists and provide inspirational athlete led live and on demand classes Hydro came to Brightcove of couple of years ago. When their business was just starting out as you can imagine the business is taking off and we're committed to supporting every stage of their growth.
And our recent renewal indicates the success that they have experienced working with our team and technology.
Of course, none of this is possible without our continued platform innovation, we have the most intelligent open platform that offers limitless scale World class security.
And powerful integrations and Q2, we introduced several new product innovations, including China delivery through our partnership with Alibaba Brightcove became the first online video platform to deliver business video into China, helping enterprises and retailers expand.
That answers and increase revenue opportunities. There is a lot of excitement around China delivery is China is projected to host 2.8 trillion and E. Commerce. This year and corporate communications divisions continued to engage employees with more of video we are customers.
And they're already using the feature including graph of multinational jeweler based in London, and voice group, a global technology company that set standards and the markets of energy oil and gas paper raw materials and transport and automotive.
We also introduced playback restrictions and.
Our most advanced security offer enables customers to protect their content from being watched by unauthorized users playback restrictions include options to restrict assets managed viewer access and permissions and prevent content piracy. Although only released this quarter, we have a number.
<unk> of customers using this feature including regional and National broadcasters, such as Egyptian Media Group Stadium, and large event companies major retailers and sports leagues.
We launched virtual events for business and easy to use virtual event solution for highly.
Hi, Lee repeatable mid sized events like employee town halls, large group training and product unveiling.
We announced this solution prior to our last earnings call and are seeing great traction and early example is nisei life insurance in Japan, which will use virtual events for business.
To reach its audiences quickly easily and securely.
And we rolled out Brightcove live updates to scale, our live streaming and preparation for large sporting events like the Usga's U S open where any viewer on the U S. Open website could follow any player on every hole.
View of the holes from different camera angles, and interact with live polling and stats. This breakthrough experience empowers leagues and federations and sporting organizations to broadcast to millions.
Now, let's turn to our go to market execution and the customers leveraging video to achieve real.
<unk> business results, we had several significant wins and renewals this quarter, including.
Black News channel of New independent network that describes itself as the nations only provider of $24.7 cable news programming created by people of color for people of color.
Specifically Black Americans.
<unk> News channel launched in February 2020, and turned to Brightcove to bring to life. Its vision for truth across apps, the web smartphones tablets and connected devices.
Sparrow live as of new artist founded business.
Democratizing access to the arts by connecting musicians directly with audiences through interactive creative experiences all streamed using brightcove.
Dal tile Corporation is the leading manufacturer and distributor of porcelain tile ceramic tile and naturals.
<unk> stone and the U S Dal tile will use brightcove to host manage and publish brand building videos across all of its public facing digital properties.
All of these innovators saw and need civic artist or commercial that wasn't being that they recognize.
Recognize the secure reliable and scalable of video experiences we've delivered for other customers and are now discovering what we can do for them using our powerful platform.
And the second quarter, we welcomed many other new customers, including the Edinburgh Fringe Festival, 1 of the world's largest.
Festivals Rooster teeth productions of community built Entertainment company and <unk>, 1 of the largest banks in Japan. We're also proud to have been chosen as the live streaming partner for the Dana Farber cancer Institutes' to fight cancer launch event.
Which showcased.
Art furnace support is needed to change the impact of cancer and our lifetimes and Brightcove was also selected to be the streaming provider for SAP flagship global user conference Sapphire.
Now, let's move to our channel strategy.
We launched the Brightcove partner program 12 months.
Ago and within the first year, we have more than 150 partners globally and continue to see great momentum.
We're pleased with our channel performance and are on track to hit our target for 20% of bookings coming through our partner channel and 2021 and expect that to grow to 30% to 50%.
Last quarter, we announced a new partner L to offering great value for performing arts organizations to reach new audiences virtually to date, we have signed 5 customers through the partnership.
Lyric opera, 1 of the leading offer companies in the United States based in Chicago is an example.
Of a new customer that came to us through <unk> to provide their patrons of the option of of digital experience during the 2021 to 2022 season.
We also continue to add new partners like Oovoo, who specialize in technology for publishers and our Ws to assist us with translation.
<unk>, our most significant partner related expansion. This quarter was in Asia Pacific, where we enlisted 12, new partners that will continue to drive growth and bookings were thrilled with the progress and growth of our partner ecosystem and it remains a strategic focus area and 2021.
Example of pleased to note that we will host our annual play customer conference on October 5th and sixth <unk>.
During this 2 day virtual conference, we will announce exciting news about our product innovations for customers and partners across multiple use cases at play you will see how they invest.
<unk>, we are making and our innovation are truly coming to life.
We will be showcasing our new way for companies to communicate with internal and external audiences with and always on channel corporate TV.
And intuitive digital video marketing solution that enables entire.
Marketing teams to be able to access utilize and distribute video content directly from the marketing platforms. These teams live in every day.
AI and ml innovation that will empower our media and enterprise customers to find reveal and monetize the value from their video.
And yet there.
This will for the first time ever allow our customers to tap into the rich intelligence generated by our vast video repository of <unk>.
Brand, new Brightcove marketplace, which will provide a new ecosystem for development partners and customers to connect.
Developers will be able to promote.
<unk> their applications and customers will be able to discover and provision apps that solve their immediate business needs.
With over 60 sessions across 3 time zones customers and partners, who will share their experiences and knowledge with our community and we will be joined by other industry Influencers.
And <unk> and keynote session hosts.
Finally, I want to share of change and our executive leadership team Rick Hanson Chief revenue Officer is leading Brightcove at the end of July over his 2 and a half years at Brightcove. He transformed the sales organization and hired a sales leadership team Thats taken us to the next.
<unk> level.
Thankful for Rick's contribution to our growth and wish him the best as he takes some time with his family.
We're excited to promote Brian broiling to the role of Executive Vice President head of Global sales, Brian joined Brightcove and August of 2019 to lead the Americas sales team.
During his tenure and the team has seen tremendous bookings growth and executed at a high level.
Higher to Brightcove foiling held leadership positions at CA technologies pivotal software and Symantec technologies.
In addition, given the importance of the renewals business and the early signs.
Of success that Richards, who joined us and the first quarter as senior Vice President of customer success to lead our global customer success and renewals business now reports directly to me.
I'm also delighted to announce that Patrick Wang from has joined Brightcove as the company's first chief.
Data officer, he will spearhead and advanced R&D organization that integrates machine learning capabilities into Brightcove solutions, bringing advanced opportunities for customers and viewers prior to Brightcove wax from led the emerging technology group at Verizon with part of capital ones.
And as cloud transformation and led the development of the machine learning platform for their credit card business and was also a founding member of the IBM Watson group.
I am so proud of every 1 of our employees and the hard work they've put in daily to make our customers successful without them.
And we would not be and the strong position we are in today.
We are executing against each of our focus areas and performing well.
Let me be clear the work is not done, but we know we are on the right path.
We will use new products and services on top of the best video platform and the industry to sell.
Solve the big problems that others cannot.
We are and are positioned to accelerate revenue growth expand margins and generate value for shareholders by creating value for our customers.
We have the right team and strategy in place to achieve our targets to be a rule of 40 company.
Let me turn the call over to Rob to walk you through the numbers Rob.
Thank you, Jeff and good afternoon, everyone I will begin with a detailed review of our second quarter, and then I'll finish with our outlook for the third quarter and the full year 2021.
Total revenue and the second quarter was $51.5 million.
Which was above our guidance range.
Breaking revenue down further subscription and support revenue was $48.6 million and professional services revenue was $2.9 million revenue benefited from higher than expected overages of $2.1 million and the quarter.
12 month backlog, which we define as the aggregate.
<unk> amount of committed subscription revenue related to future performance obligations and the next 12 months was $119.8 million.
This represents a 10% year over year increase.
On a geographic basis, we generated 57% of our revenue and North America during the quarter and 43% International.
Nationally breaking.
Breaking down international revenue, a little more Europe generated 19% of our revenue and Japan and Asia Pacific generated 24% of revenue during the quarter.
Let me now turn to the supplemental metrics, we share on a quarterly basis.
Recurring dollar retention rate and the second quarter was 86%.
It is below our target range of low to mid nineties.
As we previewed and earlier earnings calls, we had 2 large media customers downgrade or churn in the quarter.
As you know we have historically calculated on a recurring dollar retention rate based on those customers up for renewal and the current quarter.
This approach has some significant.
With drawbacks, namely that it includes a relatively small sample size and only captures upsells at the time of renewal.
This leads to substantial swings and quarterly retention that make discerning underlying trends challenging.
To better align our reporting with most leading SaaS companies. This quarter, we are introducing.
And a new metric net revenue retention, which we will report on it on a quarterly basis going forward.
We calculate net revenue retention by comparing the current annualized recurring revenue to the annualized recurring revenue from 12 months prior for those premium customers that existed 12 months prior.
This new metric we will.
<unk> better insight into our retention and up sell efforts and make our retention more comparable to peer companies.
We have posted a schedule showing historical net retention rate back to the first quarter of 2019 on the Investor Relations section of our website.
We will continue to provide our existing recurring dollar retention rate through the end of 2021.
Provide well for comparability.
With that said net revenue retention in the quarter was 98%, which compares to 99% in the first quarter of 2021, and 92% and the second quarter of 2020.
Since the beginning of 2019 net revenue retention has ranged from 92% to 100.
And as Jeff mentioned, completing the process of rebuilding our renewals business is our top strategic priority and.
And we made substantial progress and the second quarter.
There is a natural lag between when these changes are implemented and when they begin to positively impact our retention rate as we continue to make improvements and our renewals business we expect.
This metric over time to be consistently over 100%.
Our customer count at the end of the second quarter was 3263 of.
Of which 2000 and 280 were classified as premium customers.
Looking at our <unk> within our premium customer base, our annualized revenue per premium customer.
Hundred percent $92000, which was up 6% year over year and excludes our entry level pricing for starter customers, which averaged $4500 and annualized revenue.
Looking at our results on a GAAP basis, our gross profit was $34.2 million operating income was $590000.
<unk> with net income per share was <unk> <unk> for the quarter.
Turning to our non-GAAP results, our non-GAAP gross profit and the second quarter was $34.9 million <unk>.
Compared to $28.6 million and the year ago period, and represented a gross margin of 68%, which was up nicely from the 60% and the second quarter of 2000.
And subscription and support revenue represented approximately 94% of our total revenue and generated a 71% gross margin and the quarter compared to a 62% gross margin and the second quarter of 2020.
Non-GAAP income from operations was $4.2 million and the second quarter compared to $3.1 million and the second quarter of 2020.
<unk> adjusted EBITDA was $5.6 million of second quarter, compared to $4.2 million and the year ago period and above the high end of our guidance range by.
Adjusted EBITDA margin was 11% in the quarter.
Non-GAAP diluted net income per share was <unk> 11.
Based on $42.2 million weighted average shares outstanding.
And compares to net income per share of <unk> <unk> on 40 million weighted average shares outstanding and the year ago period.
Turning to the balance sheet and cash flow.
We ended the quarter with cash and cash equivalents of $40.4 million, we generated $8 million and cash flow from operations and free cash flow was $5.7 million after taking.
This new accounts, $2.3 million and capital expenditures and capitalized internal use software.
I would like to finish by providing our guidance for the third quarter and full year 2021.
For the third quarter, we are targeting revenue of $50.5 million to $51.5 million, including $1.5 million.
<unk> news and approximately $2.7 million of professional services revenue.
From a profitability perspective, we expect non-GAAP operating income to be $5 million to $1.5 million and adjusted EBITDA to be between $1.7 million and $2.7 million non.
Non-GAAP net.
Of over share is expected to be and the range of <unk> to 3 <unk>.
Based on $42.4 million weighted average shares outstanding.
For the full year, we are revising our full year outlook. We are now targeting revenue of $211 million to $213 million, including $7.4 million of Overages and approximately.
Income from $5 million of professional services revenue.
From a profitability perspective, we are expecting non-GAAP operating income of $14 million of $17 million and adjusted EBITDA to be between $19.1 million and $22.1 million non-GAAP net income per share is expected to be and the.
<unk> 12 of 30 to 37 and.
Based on $42.3 million weighted average shares outstanding.
For the full year, we're now targeting free cash flow of $7 million to $10 million.
As you consider our guidance the biggest driver to our change in outlook of the challenges related to our renewals.
It is a combination of churn being somewhat higher and the first.
Half of the year and the pace of recovery somewhat slower and the second half we have completed the steps necessary to put the renewals business on the right path, we expect the renewals business to be a meaningful driver for growth and 2022.
We believe that accelerating revenue growth is the best way to drive long term value for our shareholders in order to take advantage of the market.
Range of tuning in front of us, we will be increasing our investments and sales and marketing and the second half of the year. We have consistently demonstrated our disciplined approach to spending and our ability to scale of the business. This approach gives us the confidence to make these strategic growth investments at this time.
To wrap up Brightcove delivered another strong financial performance and the second quarter.
While we continue to work through improving our retention rates were executing against our strategic priorities and increasing the value we deliver to our customers. We look forward to sharing the product announcements and Jeff mentioned net play we believe this positions us well to drive even better top and bottom line performance as we continue to make progress towards our goal of being a rule of 40 company.
With that we will now take your questions. Operator, we are ready to begin Q&A.
And at this time.
We will have on our question and answer session. If you'd like to ask a question. Please press star 1 on your telephone keypad and confirmation tone will indicate your line is and the.
Q you May press star, 2 and if you'd like to remove your question from the queue of participants using speaker equipment. It may be necessary to pick up on your handset before pressing the star keys, 1 moment, please and while we pull for questions.
Yeah.
And our first question.
And from Eric.
Newsy with Lake Street.
Please proceed with your question.
The outlook from the <unk>.
The renewal of the retention perspective.
Rob you just finished talking about the churn a.
A little bit higher and the first half and the recovery of a little bit slower on the second half but.
As we go back 90 days to that existing guidance or to the free free.
Previous guidance, where we were talking about kind of a midpoint of $214 million and now we're looking at the midpoint of a couple of million below that.
1 of the churn that much greater than you would've thought or are you just being more conservative on the recovery being slower what's the bigger driver of that midpoint reset.
Yes, the bigger driver of the mid point reset is really around the recovery being slower.
And as.
And as we looked at the second quarter, we were pretty close to where we thought we're going to be for the second quarter and it's really the back half of the year.
Okay, because thats, what I thought I know Q1, and we had a bit of of surprised on a couple of media accounts Q2, we already kind of knew about as far as the retention exposures, but.
Okay and then.
And Eric just real quick as I mentioned and the in the prepared remarks. It does tend to focus on the on the media side, where we're seeing that slower recovery, we're really comfortable with where we are on the enterprise side of the business.
And what we're seeing there from the retention rate.
Okay and that recovery being slower on the media so what is it.
Covid related is it competitive landscape issue is it budgetary what's driving the the foot dragging.
Yeah. He he really tends to be those large media customers that continue to explore that do it yourself type of infrastructure and as we've talked about over the last couple of quarters, we're really running.
Is it down the number of large customers that we have that would have fit that profile and the new business that we're selling on the media side is much stickier as we're selling and the apps. That's all of the business problems like beacon into the media customers versus just the video delivery of that some of the larger customers.
And we'll be willing to take in house.
Okay, and then just 1 more on the outlook the implied number for the fourth quarter I'm coming up with roughly $54 million and that's kind of of the some of the first half of the year and then subtracting the midpoint Q3 guide and then.
That seems like a pretty substantial step up of roughly.
Running $3 million by my math, it and what's behind that that step up Q3, Q4 of jet Overages driven is that pipeline.
Math of what's what's the status of so from it from and overdue standpoint, we are a we're still forecasting and 1.5 per quarter. So that's in both Q3 and.
Roughly 4 so it's really based on what we're seeing in terms of anticipated sales performance and retention performance and the third quarter.
Got you okay. Thanks for taking my question.
And.
And.
Our next question is from.
And from Steven Frankel with Colliers. Please proceed with your question.
Good afternoon and Monica.
And want to go back at the same issue.
Is the issue and just dig in a little deeper so.
When when Youre seeing slower recovery are you, saying.
And in the back half of it's going to be a little higher.
Q and you expect it because because some of them you have some customers that are thinking about going DIY and that's specifically what you're seeing.
Hearing and the back half of the year, that's leading to this reduced guidance.
Steven It's Jeff.
We we have more and so you'll recall, we put out of pretty strong message.
Years ago that on.
On the sales side, we were going to improve the quality of the forecasting the integrity of all of that so that we do a better job on on our guidance.
We now have a lot more insight into our renewals out out beyond.
On the current quarter of the current period than we had before and Thats really the result of all of the things that we've implemented to focus on renewals and so when we look at that that gives us a better sense of where the risk is and.
And where we want to be very conservatively and this it doesn't take into account.
In fact that the renewals team now has earlier and site and is actually intercepting at an earlier stage and working to save those but we just need to see a couple of quarters.
Of those actions actually paying off to know that yes. Indeed, when we do these 3 things.
And the risk.
Blues and the customer goes down and this percentage. So we just need to see that for a couple of quarters to say, okay. The machinery is now working.
And we feel better about where we're going.
Okay, and then on this notion of investing and sales and marketing.
Of your kind of break that down into.
How much of this is headcount driven which will take a while to come.
Come productive versus maybe spending money and new and different ways to try and accelerate revenue growth.
Yes, and Steve it's the second 1 that we're <unk>.
Focused on and there's not a ton of head count additions that are over and above what we had and the original.
And the original guide it's much more on the demand generation side and focus demand Gen where were seeing those opportunities and the market.
And to really accelerate that bookings growth and the revenue growth and the future play play this year is.
For October 5th and 6 it's virtual event.
And we intend to do some some pretty good product rollouts and so we want to make sure.
And that we're not choking or holding back the demand Gen machine for going after those new businesses.
Okay and.
On.
Where do you think you are in the journey to to raise.
Premium on or are we plateauing here for a while until some of those new products come out later next year.
Is that no you should think about it.
Yes.
No I think I understand that sequentially, we were down quarter over quarter from Q1 to Q2, but that's a function of some of those large media customers that we had already identified churning out if you think about it we're still improving net year over year were up 6% year over year, we think that we still have a lot of green space and our existing customer base to.
Continue to sell our existing products, we don't need to wait for the new products that we're going to be talking about at play that said when we do start launching those new products, it's going to open up even more opportunity for us both on our existing customer side, but then also with new logos.
The other thing that gives us comfort is most.
And upside and the ARPA was really driven by North America over the last couple of years.
And so now we're applying those same kinds of best practices to the rest of the world. So we see some good upside potential as we start to implement those we know it works it's worked very well.
Well here and now we need to export that.
Okay and last question other than the rig departure.
Has there been any meaningful turnover and.
Sales of <unk> during the quarter.
Great question, and we certainly have been vigilant watching.
And it just because there is so much noise out there about people are jumping as they come out of Covid and we're just not seeing it right now we're paying very careful attention to it we're touching every body.
But at this point and time, we are not seeing it.
Okay. Thank you Sir.
Thank you.
And our next question is from Mike Latimore with Northland Capital markets. Please proceed with your question.
Great. Thanks, Yeah on the.
And sales force itself worthy of.
And.
Full productivity and the quarter.
Pretty much and we had a we have theres always some number of openings, but it's not a number we think is negatively impacting our ability to go win and engage.
Got it Okay, and then in terms of the.
Revenue retention.
Process. He obviously did of consulting.
And you hired a consultant last year, you hire and ahead of the group earlier. This year I guess are all of the changes in place now for revenue retention processes or.
And it's just a matter of executing them or do you think there might be additional changes in terms of the net revenue retention process here on park.
Mike I am pleased with what this team has done we're actually ahead of plan.
On implementing all of the changes.
And I and I give credit to Deb and her.
Her team on how aggressively they are going after it.
And I'm also pleased with just the really the broad expanse of the things that they're doing.
And all aspects of this and of Great example, as I noted a couple of minutes ago was television New Zealand TVN Zed.
Had been talking to us for some time about components of DIY or downsizing their relationship with us They had always been a 1 year renewal customer for the last 10 years.
And with a lot of the new things that the team has put in.
We were we were very pleased to see that they.
And new for a year they renewed for 2 years, that's how convinced they are that we're the right partner for them. So great, let's scale that up and aggressively go after all of the other major media and quite frankly enterprise customers because it's not unique to media of the same things that we're doing from media, we can be doing for.
For enterprise.
Okay got it and then on the enterprise side of things how would you characterize the pricing environment. There I mean, I guess ARPA as youre running a little bit year over year, but is pricing stable is getting more aggressive how do you think about it on the enterprise side.
Yes on the enterprise side.
Didn't read it as stable and we're still able to capture price increases year over year, we're not seeing any dramatic price pressure on the enterprise side.
Great and then and just last on it sounds like youre going to invest more and <unk>.
And on Gen going forward I guess.
Highlights of the pipeline.
Pipeline built over the last quarter.
And yet it's been kind of year to day.
Yes.
Early and that we really started over investing and the second quarter as we started to see the opportunity. We expect those investments to start paying off so as we've talked about over the last couple of years, we've really implemented a disciplined approach to.
We look at our investments so as we start seeing those investments we've made and the second quarter payoff, we'll double down and those areas and we'll pull back on those areas, where we're not seeing the necessary return and we also I'm on.
Pressed with the level of precision that the marketing team has now versus.
And how he'd months much less of a year ago in the past we had identified growth segments, we were investing and demand Gen activities. We actually now no sub segments within those segments that are getting the most immediate traction so there and there.
And so the spending I think it is more precise and more surgical because.
As sick know that the ROI.
Is going to be better.
Okay, great. Thank you.
Thank you.
And we have reached the end of the question and answer session on now turn the call over to CEO, Jeff Ray for closing remarks. Thank.
Operator, thanks, everyone for joining us I do want to reiterate.
October 5th and 6 is really important.
And so I encourage you to sign up and.
And join US for play it's going to be of very very different event.
We're very excited about the new products.
<unk> pipeline activity, we're very excited about how we can make better use of AI and ml and Theres a few other things that we're eager to show. We're also encouraged by the fact that some pretty big leading customers are working with us on these things and.
And that gives us a high level of confidence.
And the direction that we're taking this company I hope you continue to be safe and and your families do well and I look forward to talking with you and the near future if not beyond thanks, everyone have a good day.
This concludes today's conference and you may disconnect your lines at this time thank.
With participation.
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Thank you.
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And.
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