Q3 2021 Evolv Technologies Holdings Inc Earnings Call
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You'll have paused the program.
Speaker 1: have paused the program. As a result of a number of risks and uncertainties, including, without limitation, the risk factors set forth under the caption, risk factors, in our perspectives filed with the SEC on September 3, 2021, and in our other documents filed with or furnished to the SEC.
As a result of a number of risks and uncertainties, including without limitation the risk factors set forth under the caption risk factors in our prospectus filed with the SEC on September 3rd 2021.
And in our other documents filed with or furnished to the SEC.
The forward looking statements made today represent our views as of November 10th 2021.
Speaker 2: The forward-looking statements made today represent our views as of November 10, 2021.
Speaker 2: although we believe that the expectations reflected in these flow and looking statements are reasonable. We cannot guarantee that future results, level of activity, performance and events and circumstances reflected in the flow and looking statements will be achieved or will occur.
Although we believe that the expectations reflected in these forward looking statements are reasonable we can.
Cannot guarantee that future results level of activity performance and events and circumstances reflected in the forward looking statements will be achieved or will occur.
Speaker 2: except as may be required by applicable law, we specifically disclaim any obligations to update them to reflect future events or circumstances.
Except as may be required by applicable law, we specifically disclaim any obligation to update them to reflect future events or circumstances.
Speaker 2: Before I turn the call over to Peter George, let me briefly bring to your attention a few upcoming investor events.
Before I turn the call over to Peter George Let me briefly bring to your attention a few upcoming investor events.
Speaker 2: Tomorrow, Thursday, November 11th, we will be at the SPEAPO Midwest Investor Virtual Conference. On Tuesday, November 30th, we will be at the Credit Suisse Technology Conference in Scottsdale, Arizona. And on Wednesday, December 15th, we'll be at the Imperial Capital Conference in New York City.
Mauro Thursday November 11th we will be at the Stifel Midwest Investor Virtual conference on Tuesday November 30th we will be at the credit Suisse Technology Conference in Scottsdale, Arizona and on Wednesday December 15th will be at the Imperial Capital Conference in New York City.
Speaker 2: We will also be hosting a variety of other live and virtual investor events throughout the quarter.
We will also be hosting a variety of other life and virtual investor events throughout the quarter.
Speaker 2: For more information or to schedule a meeting with the management team at any of these conferences,
For more information or to schedule, a meeting with the management team at any of these conferences.
Speaker 2: please contact me at bnorris at evolvedtechnology.com. With that, I'd like to turn the call over to Peter. Why haven't we ever seen after ME?
Please contact me at be Norris had a ball technology dot com with that I'd like to turn the call over to Peter Peter.
Thanks, Brian Good afternoon, everyone and thank you for joining us today.
Speaker 3: Thanks, Brian . Good afternoon, everyone, and thank you for joining us today.
Speaker 3: We have a lot of exciting news to share regarding the third quarter and our business moment.
We have a lot of exciting news to share regarding the third quarter and our business momentum.
Speaker 3: But before we start, I want to take a moment to formally introduce Mario Ramos, who joined us last week as Chief Financial Officer and Chief Risk Officer.
Before we start I want to take a moment to formally introduce Mario Ramos, who joined US last week, as Chief Financial Officer, and Chief Risk Officer.
Speaker 3: Mario brings over two decades of executive experience, building and leading high growth companies, and his financial and strategic leadership will be instrumental in supporting our next stage of growth.
Mario brings over two decades of executive experience building and leading high growth companies and his financial and strategic leadership will be instrumental in supporting our next stage of growth.
Speaker 3: He's had a very successful career, which included a six-year run at CVS in a variety of executive leadership roles, including the FO of CVS Care Mart.
<unk> had a very successful career, which included at six year run at Cvs and a variety of executive leadership roles, including CFO of Cvs Caremark.
Speaker 3: Before that, he was head of CVS's M&A and corporate development group, and led the acquisition and integration of Aetna, which as you know, is a signature transaction in the transformation that CVS has gone.
Before that he was head of Tvs's, M&A and corporate development group and lengthy acquisition and integration of the Aetna, which as you know with the signature transaction and the transformation that Cvs has gone through.
Speaker 3: He has also served as COO of CVF International and spent over 17 years on Wall Street, primarily at J.P. Morgan and Lehman Brothers. We're thrilled to have you on board. Welcome, folks.
He has also served as CEO of Cvs International and spent over 17 years on Wall Street, primarily at J P. Morgan and Lehman Brothers, we're thrilled to have you on board welcomed malia.
Speaker 4: Thank you, Peter. It's great to be here and thank you for the warm welcome. I'm excited to join the team and I look forward to meeting and working with all the members of the investment community.
Thank you Peter and it's great to be here and thank you for the warm welcome and I'm excited to join the team and I look forward to meeting and working with all of the members of the investment community.
Speaker 4: Let me just share a little bit of why I joined the company, which started first and foremost with its mission.
Let me just share a little bit of why I joined the company, which started first and foremost with its mission.
Speaker 4: I really believe strongly in a mission of creating a safer world for everyone to work, learn, and play.
I really believe strongly and involves mission of creating a safer world for everyone to work learn and play.
Speaker 4: Also, as the continuing our gross trajectory, I believe it will need to continue scaling the business to maximize efficiency and maintain our market leading position.
Also as we continue on our growth trajectory.
I believe we will need to continue scaling the business to maximize efficiency and maintain our market leading position.
Speaker 4: This means building a solid foundation and infrastructure across the company with a special focus in certain areas like supply chain among others.
This means building a solid foundation and infrastructure across the company with a special focus in certain areas like supply chain.
Others and.
Speaker 4: I'm proud to say I've spent a large portion of my career scaling and leading digital transformations of companies based in the US and abroad.
I'm proud to say Ive spent a large portion of my career scaling and leading digital transformation of <unk>.
<unk> baked in the U S and abroad.
Speaker 4: I'm looking forward to putting that experience to work at a vault, a leader in one of the fastest growing markets across all of technology.
I'm looking forward to putting that experience to work get evolve a leader in one of the fastest growing markets across all of technology.
Speaker 3: Thanks, Mario. Great to have you on board. I also want to take a moment to thank Peter Folbeier for all his contributions to the business over the last two years and all the contributions he will make as he takes on the challenges of his new role as Senior Vice President of Strategic Finance.
Thanks, Mario Great to have you on board.
Also wanted to take a moment to thank Peter faux bear for all his contributions to the business over the last two years and all the contributions he will make as he takes on the challenges of this new role as senior Vice President of strategic finance in this capacity he will play an important role in the company's growth.
Speaker 3: In this capacity, he will play an important role in the company's growth initiative.
Lives.
We're pleased to be reporting strong third quarter results highlighted by record total contract value of orders booked and record revenues.
Speaker 3: We're pleased to be reporting strong third quarter results, highlighted by record total contract value of orders booked and record revenue.
Speaker 3: We continue to extend our leadership position with dozens of new customers and expansions that exist in customers, strong new product introduction, and acceleration with our key channel partners.
We continue to extend our leadership position with dozens of new customers and expansions at existing customers strong new product introduction and acceleration with our key channel partners.
Speaker 3: We remain on track for a strong finish in 2021 and are well positioned to deliver on our TCV and market expansion goals.
We remain on track for a strong finish in 2021 and are well positioned to deliver on our PCV and market expansion goals.
Speaker 3: Two of the KPIs that we consider to be key measures of our progress are TCV of Orders Book and Revenue.
Two of the Kpis that we consider to be key measures of our progress our T. C V of orders book and revenue.
Speaker 3: We delivered record results in both metrics in Q3 and are already off to a strong start here in Q4.
We delivered record results in both metrics in Q3 and are already off to a strong start here in Q4.
PCB was $16 9 million in the third quarter up 365% year over year.
Speaker 3: PCV was 16.9 million in the third quarter, up 365% year over year.
Speaker 3: revenue was 8.4 million in the third quarter up 473% year over year
Revenue was $8 4 million in the third quarter up 473% year over year.
Speaker 3: While we don't plan to share this level of detail every quarter, we want us to provide some additional context around the moment and we're currently enjoying.
While we don't plan to share this level of detail every quarter, we wanted to provide some additional context around the momentum we're currently enjoying.
Speaker 3: We saw a record number of new customers in the third quarter. A seven-fold increase compared to the third quarter of last year. We had a record number of units booked. More than a five-fold increase compared to the third quarter of last year. We reported five transactions of at least $1 million in the third quarter compared to none in the third quarter of the last year and four seven-figured transactions in the previous four quarters combined.
We saw a record number of new customers in the third quarter.
Seven fold increase compared to the third quarter of last year.
We had a record number of units booked more than a fivefold increase compared to the third quarter of last year.
We reported five transaction of at least $1 million in the third quarter compared to none in the third quarter of last year and four seven figure transactions in the previous four quarters combined.
Speaker 3: Our ASP, which is a proxy for average deal size, increased by over 50% compared to the third quarter of last year.
Our asp's, which is a proxy for average deal size increased by over 50% compared to the third quarter of last year.
Speaker 3: I am particularly pleased that we saw a broad diversification of our TCV activity across nearly 10 target vertical markets and no one transaction amounted to more than 15% of PCV in the quarter
I am, particularly pleased that we saw a broad diversification of our PCV activity across nearly 10 target vertical markets and no one transaction amounted to more than 15% of PCV in the quarter.
Speaker 3: About a third of our TCV came from professional sports with important contributions from the NFL's Carolina Panthers and Tennessee Titans.
About a third of our TCE came from professional sports with important contributions from the NFL Carolina Panthers and Tennessee Titans.
Speaker 3: Three other vertical markets each contributed about 10% to TCV in the quarter, including performing art centers, convention centers, and factory warehouse.
Three other vertical markets each contributed about 10% to <unk> in the quarter, including performing Arts Center Convention centers and factory warehouses. We also saw important contributions from hotels and casinos as well as the two other rapidly emerging markets health care.
Speaker 3: We also saw important contributions from hotels and concenos, as well as in two other rapidly emerging markets, healthcare and government.
<unk> and government.
Speaker 3: In summary, by any measure whatsoever, T-C-V and revenues, accelerating sales cycle, growing ASPs, and volume of seven figure transactions, the accelerated investment we've been making in our customer facing functions and in our channel partners are paying dividends.
In summary by any measure whatsoever.
CV in revenues accelerating sales cycle.
Knowing asp's and volume of seven figure transactions, the accelerated investments, we've been making in our customer facing functions and in our channel partners are paying dividends.
Speaker 3: This gives us greater confidence to continue this strategy on our path to meet our 2022 and 2023 growth plan.
This gives us greater confidence to continue this strategy on our path to meet our 2022 and 2023 growth plans.
Yes.
We continue to make great progress on our goal of winning the professional sports market a market. We began investing in just a year ago at that time, we had virtually no brand awareness and we had no customers.
Speaker 3: We continue to make great progress on our goal of winning the professional sports market. A market we began investing in just a year ago. At that time, we had virtually no brand awareness and we had no customers.
Speaker 3: I'm delighted to report that as of the end of the third quarter, 15% of major league baseball franchises, including the Chicago Cubs and the San Francisco Giants, are now screening all entering fans with evolved express.
I'm delighted to report that as of the end of the third quarter, 15% of major League baseball franchises, including the Chicago Cubs and the San Francisco Giants are now screening all entering fan with evolve express.
During the MLB season, we scanned upwards of 250000 baseball fans on any given night at stadiums across the country.
Speaker 3: During the MLB season, we scanned upwards of 250,000 baseball fans on any given night at stadiums across the country.
Speaker 3: Further, a full 10% of all National Football League stadiums have now adopted a vaulted express to screen all entering fans, including the home venues of the Atlanta Falcons, the Carolina Panthers, and most recently, the Tennessee Titans. On any given Sunday in the NFL, we are now screening over 200,000 professional football fans.
Further a full 10% of all National Football League stadiums have now adopted evolve express to screen all entering fans, including the home venues of the Atlanta Falcons, The Carolina Panthers and most recently, the Tennessee Titans on any given Sunday.
The NFL, we are now screening over 200000 professional football fans.
Speaker 3: The professional sports market is a relatively small part of our $2.20 billion total addressable market or tan.
Professional sports market is a relatively small part of our two <unk>.
$20 billion total addressable market or Tam.
Speaker 3: It's part of the $2 billion regulated market along with aviation which currently uses outdated analog metal
It's part of the $2 billion regulated market, along with aviation, which currently uses outdated analog metal detectors.
Speaker 3: Our progress in this market reflects our unique ability to deliver vastly improved venue security and transform the fan experience while reducing the need to hire hard-defined security personnel.
Our progress in this market reflects our unique ability to deliver vastly improved venue security and transform the fan experience, while reducing the need to hire part define security personnel.
Speaker 3: We're also seeing more and more team executives get services personnel and fans themselves demanding of all.
We're also seeing more and more team executives guest services personnel and fans themselves demanding evolve.
Speaker 3: These early beach heads across MLB, the NSL, and now MLF are important too because of the visitors that attend events at these facilities.
These early beachheads across the MLP, the NFL and now MLS are important too because of the visitors that attend events at these facilities.
Speaker 3: These include economic buyers, safety leaders, and facility operators and other verticals, including distribution warehouses, performing arts, casinos and schools.
These include economic buyers safety leaders and facility operators in other verticals, including distribution warehouses performing arts casinos in schools.
Speaker 3: We believe that all of this newfound awareness is part of the network effect and force multiplier for evolved technology. Let me tell you a little.
We believe that all of this new found awareness is part of the network effect and force multiplier for evolve technology.
Let me tell you a little about a few of these customers.
The Tennessee Titans had previously been using walk through metal detectors and handheld won that required over 280 security personnel to work the gates at Nissan Stadium.
Speaker 3: The Tennessee Titans had previously been using walk-through metal detectors and handheld gons that required over 280 security personnel to work the gates at Nissan State.
Speaker 3: The Titans installed 17 SaaS-based evolved express units, which have been active now for the last several home games. The result has been a remarkable 66% reduction in the number of security personnel needed at their gates and a dramatic improvement in the overall guest experience.
Heightened installed 17, SaaS based evolved express units, which have been active now for the last several home games. The result has been a remarkable 66% reduction in the number of security personnel needed at their gate and a dramatic improvement in the overall guest.
Experience.
Speaker 3: Over the last three home games, we've stopped 54 guns, knives, and other prohibitive items from entering Nissan Stadium. And on a scale of 0 to 5, the average guest gate entry rating has more than doubled from 2.23 to 2.4.6.
Over the last three home games, we've stopped 54 guns knives, and other prohibitive items from entering Nissan Stadium and on a scale of zero to five the average guests gate entry rating has more than doubled from two to three to four six.
Speaker 3: This is the perfect example of why customers deploy our technology.
This is a perfect example of why customers deploy our technology.
Speaker 3: Our ability to deliver dramatically increased security posture, greatly improved the guest experience, and lower the venues operating costs. Primarily security labor costs.
Our ability to deliver dramatically increased security posture greatly improve the guest experience and lower the venues operating costs, primarily security labor costs.
Speaker 3: Another example is the Pitchbird Cultural Trust, which selected us to provide improved weapons detection and overall guest experience across multiple theaters, performance halls, galleries, and other venues in the historic entertainment district.
Another example is the Pittsburgh Cultural trust, which selected us to provide improved weapons detection and overall guest experience across multiple theaters performance halls galleries and other venues in the historic Entertainment District.
Speaker 3: of all the expresses now in place at floor the performance halls and theaters in the cultural district as well as the space visual arts gallery. This deployment builds on our success at Pittsburgh Symphony Orchestra's Hines Hall, where we were able to reduce the security screening footprint in the lobby by 60% while also eliminating outdoor cues where guests previously waited in cold weather.
<unk> Express is now in place at for the performance halls, and theatres in the cultural district as well as the space Visual Arts Gallery. This deployment build on our success at Pittsburgh Symphony orchestras high install where we were able to reduce the security screening footprint in the lobby by 50.
<unk> percent, while also eliminating outdoor cues, where guests previously weighted and poor weather.
Speaker 3: One of the most important elements of our long-term growth objective is of course the leverage we gain from our channel partnership.
One of the most important elements of our long term growth objective is of course, the leverage we gain from our channel partnerships.
Speaker 3: Today we have nearly 36 authorized channel partners and several strategic global partners in Motorola Solutions, our OEM, Johnson Controls, and Stanley Black and Decker. I'm delighted to report that our channel program contributed to one third of our TCV order activity in the third quarter. Let me share a few other highlights of our indirect go-to-market efforts. Let's start with our partners.
They we have nearly 36 authorized channel partners and several strategic global partners and Motorola solutions, our OEM Johnson controls and Stanley Black <unk> Decker I'm delighted to report that our channel program contributed to one third of our <unk> order activity.
In the third quarter, let me share a few other highlights of our indirect go to market efforts.
Let's start with our partnership with Motorola solutions.
Speaker 3: Since announcing the partnership, Layton Q2, we've made great progress on cross-training, enablement, activation, and certification of the Motorola Solution Sales and Sales Engineering team.
Since announcing the partnership late in Q2.
We've made great progress on cross training enablement activation and certification of the Motorola solutions sale and sales engineering teams. While it's still early we're encouraged not only by the early wins, we've now secured but by momentum momentum in the pipeline.
Speaker 3: While it's still early, we're encouraged not only by the early winds we've now secured, but by momentum in the pipeline.
Speaker 3: We now have nearly 60 qualified opportunities in our pipeline with Motorola, across professional sports, schools, hotels, and casinos, healthcare, factory warehouses, and government where they have such a strong market position. More to come there, but we're excited about the accelerated opportunities and business that we're finding together.
We now have nearly 60 qualified opportunities in our pipeline with Motorola across professional sports schools hotels, and casinos healthcare factory warehouses and government, where they have such a strong market position.
More to come there, but we're excited about the accelerated opportunities and business that we're finding together.
In addition, we recently worked with Stanley to secure an important win at the Indianapolis Symphony Orchestra, one of the most iconic performing arts venues in the nation as.
Speaker 3: In addition, we recently worked with Stanley to secure an important win at the Indianapolis Symphony Orchestra. One of the most iconic performing arts venues in the nation.
Speaker 3: Evolving Express was installed at the historic Scholbert Circle Theater to create a seamless and safer entry experience for the ISO's audiences, museums, musicians, and staff. We're proud to partner with them on the journey to digitally transform their physical security and delight their piece.
As Bob Express was installed at the historic Schober Circle theater to create a seamless and safer entry experience for the Isos audiences Museum musicians and staff, we're proud to partner with them on their journey to digitally transform their physical security and delight their patrons.
Speaker 3: We also have a very strong regional partners which have a close longstanding customer relationships and in many cases, deep vertical market expertise in the market's worth focus on.
We also have a very strong regional partners, which have a close long standing customer relationships and in many cases deep vertical market expertise and the markets we're focused on.
Speaker 3: A great example of this is VTI security based in Minnesota, where we're seeing growing traction, particularly in the health care market.
A great example of it is VPI security based in Minnesota, where we're seeing growing traction, particularly in the healthcare market.
We work together.
Speaker 3: We work together with VTI to secure several new customers in the theory quarter, including the Mayo Clinic Health System, which has dozens of locations in several states. We're now being deployed in emergency entrances of their hallmark location in Rochester, Minnesota to provide patient and staff safety.
We work together with DTI to secure several new customers in the third quarter, including the Mayo Clinic health system, which has dozens of locations in several states. We are now being deployed in emergency entrances of their hallmark location, and Rochester, Minnesota to provide patient and staff.
<unk> safety.
Speaker 3: Our success landing, that initial location in the third quarter, has led directly to expansion opportunities at other Mayo Clinic locations. This is a perfect example of our land and expand strategy coming together with our scale-through partner approach. As you know, first and...
Our success landing that initial location in the third quarter has led directly to expansion opportunities and other Mayo clinic locations. This is a perfect example of our land and expand strategy coming together with our scale through partner approach.
As you know first and foremost.
We are a technology company.
I want to close with a few comments about some exciting technical innovations we introduced in the third quarter.
Speaker 3: I want to close with a few comments about some exciting technical innovations we introduced in the third quarter. We're very excited about the latest release of Evolve Insights, our web-based portal companion to Evolve Express, which helps companies advance venue security with the power of data analytics to make venue smarter.
We're very excited about the latest release of evolve inside our web based portal companion to evolve express, which helps companies advanced venue security with the power of data analytics to make venue smarter.
Speaker 3: Evolved insights as three things. Number one, on demand. New mobile access to key metrics and remote scanner management enables security and operations leaders to make better data driven decisions about their security posture from any location for more responses than you manage them. Number two.
<unk> insight is three things number one on demand new mobile access to key metrics and remote scanner management enabled security and operations leaders to make better data driven decisions about their security posture from any location for more responsive venue management number.
Two it's data driven the new analytics and evolve insights allows for the integration and interrogation of threat types and alarm rates informed decisions around sensitivity settings, and better understanding of prevent characteristics, improving security posture staffing and training and venue Reese.
Speaker 3: The new analytics and evolve insights allows for the integration and interrogation of threat types and alarm rates. Inform decisions around sensitivity settings and better understanding of resent characteristics, improving security posture, staffing and training, and venue resource planning.
<unk> planning.
Speaker 3: And number three, it's connected. The new remote management capabilities allow administrators to access the valve express systems for remote configuration and monitoring, including important notifications and system changes regardless of where they are in the world.
And number three it's connected the new remote management capabilities allow administrators to access evolve express system for remote configuration, and monitoring including important notifications and system changes regardless of where they are in the world.
I want to thank our entire R&D team for their incredible work, which continues to deliver ever increasing value to our customers through our AWS enabled cloud offering and continues to set the standard for innovation across the industry.
Speaker 3: I want to thank our entire R&D team for their incredible work, which continues to deliver ever increasing value to our customers through our AWS enabled cloud offering and continues to set the standard for innovation across the industry.
Speaker 3: So in summary, what pleased to be reporting strong third quarter results highlighted by record total contract value of orders booked and record revenues. We continue to extend our leadership position with a record number of new customers and expansions of existing customers, strong new product introduction, and acceleration with our key channel partners.
So in summary, we're pleased to be reporting strong third quarter results highlighted by record total contract value of orders booked and record revenues. We continue to extend our leadership position with a record number of new customers and expansion of existing customers strong new product.
<unk>, an acceleration with our key channel partners.
Speaker 3: We remain on track for a strong finish in 2021 and believe that we are well positioned to deliver on our TCV and Markin Expansion Gold.
We remain on track for a strong finish in 2021 and believe that we are well positioned to deliver on our PCV and market expansion goals.
Speaker 3: So with that, let me turn it over to Peter Fobair to review our financial results in more detail and on our outlook for the balance of the year. Peter.
With that let me turn it over to Peter for Bear to review, our financial results in more detail and our outlook for the balance of the year Peter.
Speaker 2: Thanks Peter and good afternoon everyone. Today I'll cover our financial results for the third quarter and our outlook for the balance of the year. I'll start with our
Thanks, Peter and good afternoon, everyone today I'll cover our financial results for the third quarter and our outlook for the balance of the year.
I'll start with our third quarter results.
Speaker 2: The total contract value of oldest books or TCB was $16.9 million in the third quarter, up 365% year over year, reflecting strong new customer addition.
The total contract value of orders booked our <unk> was $16 9 million in the third quarter up 365% year over year, reflecting strong new customer additions.
Speaker 2: Total revenue was $8.4 million, a 473% year over year. Reflecting strong new customer additions across our core vertical markets, as well as an expanded cohort of customers that chose to purchase hardware upfront.
Total revenue was $8 4 million up 473% year over year, reflecting strong new customer additions across our core vertical markets as well as an expanded cohort of customers that chose to purchase hardware upfront.
Product revenue was approximately $5 3 million compared to $300000 in the third quarter of last year, reflecting the decision of two large customers. The Carolina Panthers in the National Football League and a major New England area Convention Center to purchase evolve express at the beginning of the subscription peer.
Speaker 2: Product revenue was approximately $5.3 million compared to $300,000 in the third quarter of last year. Reflecting with the decision of two large customers, the Carolina Panthers of the National Football League, and the major New England Area Convention Center, to purchase of all express at the beginning of the subscription period. These two transactions resulted in about $3 million of product revenue in the third quarter of 2021.
Great.
These two transactions resulted in about $3 million of product revenue in the third quarter of 2021.
Looking ahead, we expect a greater percentage of our revenue to shift to pure subscription revenue, which tends to provide much higher recurring revenue.
Speaker 2: Looking ahead, we expect a greater percentage of our revenues to shift to pure subscription revenues which tends to provide much higher recurring revenues.
Subscription revenue was $2 3 million up 190% year over year.
Speaker 2: Subscription revenue was $2.3 million, up 190% year over year, primarily reflecting the strong new customer additions and growth in systems and services.
Primarily reflecting the strong new customer additions and growth in systems and service.
Speaker 2: Service revenue, which primarily consists of professional services and training, was approximately $700,000, up 125% year over year, reflecting an increased volume of installation.
Service revenue, which primarily consists of professional services and training was approximately $700000 up 125% year over year, reflecting an increased volume of installations.
Speaker 2: Subscription gross margin expanded to 53% in the third quarter from 43% in the second quarter as we saw continued benefit from our scaling operation.
Subscription gross margin expanded to 53% in the third quarter from 43% in the second quarter as we saw continued benefit from our scaling operations.
Speaker 2: Product growth margin increased to 45% in the third quarter from 15% in the second quarter. Primarily due to certain credits we received from our contract manufacturer for inventory that we had provided to them. Excluding this benefit, our product growth margin would have been 25% in the third quarter, which again would have demonstrated solid improvement from the 15% in Q2.
Product gross margin increased to 45% in the third quarter from 15% in the second quarter, primarily due to certain credits we received from our contract manufacturer for inventory that we had provided to them.
Excluding this benefit our product gross margin would've been 25% in the third quarter, which again would have demonstrated solid improvement from the 15% in Q2.
Speaker 2: Total gross margin was 50% compared to 25% in the second quarter of 2021. Excluding the product cost of good sold benefit, but I just described gross margin would have been 36% in the third quarter.
Total gross margin was 50% compared to 25% in the second quarter of 2021.
Excluding the product cost of goods sold benefit that I've, just described gross margin would've been 36% in the third quarter.
Speaker 2: Total operating expenses were $20.8 million in the third quarter up 205% year over year. The primary drivers of the increase were headcount additions across the company, most notably in revenue generating sales as well as technical talent for our engineering team.
Total operating expenses were $28 million in the third quarter up 205% year over year. The primary drivers of the increase were head count additions across the company, most notably in revenue generating sales as well as technical talent for our engineering team.
Speaker 2: stock-based compensation expense, transaction costs associated with the offering, as well as a modest impairment charge for the right amount of certain assets.
Stock based compensation expense transaction costs associated with the offering as well as a modest impairment charge for the write down of certain assets.
Speaker 2: We extended the third quarter with approximately 160 employees compared to approximately 50 employees at March 31, 2021.
We exited the third quarter was approximately 160 employees compared to approximately 50 employees at March 31 2021.
Speaker 2: Our loss from operations was $16.6 million in the third quarter compared to $6.2 million in the third quarter of last year.
Our loss from operations was $16 6 million in the third quarter compared to $6 2 million in the third quarter of last year.
Speaker 2: Finally, we reported net income of $23.2 million or 15 cents per diluted chair compared to a net loss of $6.3 million or 70 cents per diluted chair in the year ago period.
Finally, we reported net income of $23 2 million or <unk> 15 per diluted share compared to a net loss of $6 3 million or 70% 70 per diluted share in the year ago period.
Now turning to the balance sheet.
Speaker 2: We ended the quarter with approximately $334 million in cash and cash equivalents compared to $4.7 million at December 31, 2020.
We ended the quarter with approximately $334 million in cash and cash equivalents compared to $4 7 million at December 31, 2020.
Speaker 2: This increase reflects the completion of our public offering in the third quarter of 2021. More specifically, our financing activities in the third quarter included $300 million in Pike Proceed.
This increase reflects the completion of our public offering in the third quarter of 2021, more specifically our financing activities in the third quarter included $300 million in pipe proceeds.
Speaker 2: and approximately $51.2 million in proceeds from the closing of our merger with New Home.
And approximately $51 2 million in proceeds from the closing of our merger with new hope.
We ended the quarter with net accounts receivable of $7 3 million compared to $1 4 million at December 31, 2020, reflecting strong new customer acquisition and billing activity.
Speaker 2: We ended the quarter with net accounts receivable of $7.3 million compared to $1.4 million at December 31, 2020, reflecting strong new customer acquisition and billing activity.
Speaker 2: We ended the third quarter with property and equipment of $17.8 million compared to $9.3 million at December 31, 2020.
We ended the third quarter with property and equipment of $17 8 million compared.
Compared to $9 3 million at December 31, 2020.
Speaker 2: This growth reflects strong customer adoption of solutions via our peer subscription pricing model under which we retain title of Evolve Express.
Speaker 2: I'll close with a few comments on how we're thinking about the rest of the year. I will remind you that these forward-looking statements represent our views only as of today.
Speaker 2: Based on the strength of our third quarter results and our outlook for the balance of the year, we are raising our previously issued guns for both TCB and revenue.
Speaker 2: Our current expectations are for full year total contract value or TCV of between $53 and $57 million compared to our previous issue don't look of $53 to $55 million.
Speaker 2: While it is our practice to only provide our business outlook on an annual basis, with only one quarter to go in a year, our outlook by extension calls for TCB of between $17 and $21 million in the fourth quarter of 2021.
Speaker 2: Our current expectations for a full year revenue of between $20 and $23 million compared to our previously issued outlook of $20 to $21 million.
Hundred and $23 million compared to our previously issued outlook of $20 million to $21 million.
Again, only with one quarter left to go in a year or outlook by extension calls for revenue between three and $6 million in the fourth quarter of 2021.
Speaker 2: Again, only with one quarter left to go in the year, our outlook by extension calls for revenue between $3 and $6 million in the fourth quarter of 2021.
Speaker 2: This reflects our expectation that more customers will be traditional subscription transactions versus the greater contribution of purchase subscription transactions that we saw in Q2 and Q3.
This reflects our expectation that more customers will be traditional subscription transactions versus the greater contribution a purchase subscription transactions that we saw in Q2 and Q3.
The core drivers that support our overall growth opportunity are intact.
Speaker 2: The core drivers that support our overall growth opportunity are intact.
Speaker 2: The key trends of escalating gun violence, venue reopening, and the demand by visitors for a more frictionless and touchless guest experience are all powerful drivers for growth for us.
The key trends of escalating gun violence venue reopening and the demand by visitors for more frictionless and touch the guest experience are all powerful drivers for growth for us.
We expect to continue to invest across the business, mostly in revenue generating in revenue supporting head count as well as an engineering resources to continue to extend our leadership position.
Speaker 2: We expect to continue to invest across the business, mostly in revenue generating and revenue supporting head count, as well as in engineering resources to continue to extend our leadership position.
Speaker 2: We believe all of these investments will put us in excellent position to continue to capture the opportunity in 2023 and beyond.
We believe all of these investments will put us in excellent position to continue to capture the opportunity in 2023 and beyond.
We will provide a detailed outlook during our fourth quarter earnings call in March of 2022.
Speaker 2: We'll provide a detailed outlook during our fourth quarter earnings call in March of 2022.
So in summary, we're pleased with our strong third quarter results were.
Speaker 2: So in summary, we're pleased with our strong third quarter results. We're excited about our plans for the...
We're excited about our plans for the fourth quarter.
Speaker 2: and the opportunity ahead in 2022. And with that, I'll turn the call back over to Brian .
And the opportunity ahead in 2022 and.
And with that I'll turn the call back over to Brian.
Speaker 5: Thank you, Peter. If this time, we'd like to open the call up for Q&A. Again, we ask participants to limit themselves to one question and one follow-up. Operator?
Thank you Peter at this time, we'd like to open the call up for Q&A again, we ask participants to limit themselves to one question and one follow up.
Operator.
And ladies and gentlemen, if you wish to ask a question. Please press. One then zero on your Touchtone phone you may remove yourself from queue at anytime depressing one zero again if.
Speaker 6: And ladies and gentlemen, if you wish to ask a question, please press one then zero on your touch tone phone. You may remove yourself in queue at any time repressing one zero again. If you're using a speaker phone, please pick up the answer before pressing the number.
If you're using a speaker phone please pick up the handset before pressing the numbers.
Speaker 6: Once again, if you have a question, please press 1-0 at this time.
Once again, if you have a question. Please press one than zera at this time.
Okay.
Speaker 6: Okay, and our first question will come from Mike Latimore with Northland Capital Markets. Please go ahead. Yeah, congratulations.
Okay, and our first question will come from Mike Lattimore with Northern capital markets. Please go ahead.
Yes, congratulations on a great Carter, they're great romantic on the business.
Thank you.
I like the the emergency room example that seems like that's a.
Speaker 5: I like the emergency room example. That seems like that's a logical one that can have to go everywhere.
The logical under the category everywhere.
Yup.
Speaker 5: So, you give a generally an employee head count update. How are the sales hiring going? Is that on track? And what kind of background?
So.
Generally an employee head count.
Update how're hours.
Sales hiring going is that on track and what kind of background that people are you see on there.
Yeah.
Speaker 3: Thanks, Mike. Good to have you on the call. So just your point about the the emergency room. So we saw healthcare as one of the big emerging verticals in Q3 that we think is going to be one of the biggest verticals for the company going forward. You may remember last quarter, we talked about casinos and theme parks as being big parts of our growth.
Thanks, Mike good good.
We can have you on the call. So just your point about the emergency room. So we saw healthcare as one of the big emerging are vertical in Q3.
That we think is going to be one of the biggest vertical for the company going forward you may remember last quarter, we talked about.
Casinos.
And theme park is being big parts of our growth.
Speaker 3: This quarter it was healthcare. So it's a natural place for us. We're excited about that, what that means. So to capture that demand, we're continuing to add new people across the company.
This quarter. It was it was healthcare growth and natural place for us and we're excited about that what that means the capture that demand, we're continuing to add new people across the across the company.
Speaker 3: You know, we started the year, as you know, with about 50 people. We're going to exit this year with about 180. And we're adding people in every part of the organization, in particular quota-carrying salespeople to capture the demand in the market.
We started the year is you know was about 50 people were going to exit this year was about 180.
And we're adding people in every part of the organization in particular quoted carrying salespeople to capture the demand in the market, who we should exit this year with 25 to 30 quoted carrying salespeople.
Speaker 3: So we should exit this year with 25 to 30 Quote of Carrying Sales People.
Speaker 3: In conjunction with that, another 10 to 15 solution engineers, they team cell with our customers. And then of course, you heard.
In conjunction with that another 10 to 15 solution engineered <unk> cell with our customers and then of course you heard.
Speaker 3: The work that we're doing to activate the channel, we were thrilled to see the channel represent what's the third of our business in the quarter and we expect that to continue. And of course, our channel partners like Motorola and Stanley, these are big sizable companies with hundreds of salespeople. And in some cases, Motorola has thousands of channel partners. This is gonna be a process and a journey with them, but it's gonna have a big impact on our future ability.
The work that we're doing to activate the channel we were thrilled to see the channel represent a third of our business in the quarter and we expect that to continue and of course, our channel partners like Motorola and family. These are big sizeable companies with hundreds of salespeople.
And in some cases Motorola has thousands of channel partners. This is going to be a process and a journey with them, but it's going to have a big impact on our future ability to get operational leveraged our go to market model. So between the people were hiring and then getting that scale through the channel will be able to capture the growing demand in the market.
Speaker 3: to get operational leverage in our go-to-market model. So between the people we're hiring and then getting that scale through the channel will be able to capture the glowing to the end in the market.
Yes perfect.
Speaker 5: And then you talked a little bit about more bookings in the subscription category in the fourth quarter relative to product. Is that tied to vertical mix or channel versus direct? Or is it just kind of a bottoms up to help?
And then you talk a little bit about more bookings in the subscription category in the fourth quarter relative to product.
Is that tied to vertical mix, our channel versus direct or is it just.
Bottoms up.
Yes, it's peaceful there.
Speaker 6: Yeah, I like it's a beautiful there. You know, again, we talk about a lot of the purchase subscription deals that we're closing and being in professional sports.
Again, we talk about a lot of the purchase subscription deals that were closing being in professional sports if.
Speaker 6: If we just look at the pipeline in 2.4, a lot of the pipeline is coming from that $18 billion Tam, the Greenfield opportunities. So we expect that it would be a little bit of a shift more towards the subscription deals in 2.4. Congratulations, super. Yeah, yeah, okay. Great. Thanks a lot.
If we just look at the pipeline in queue for a lot of the pipeline is coming from that 18.
Billion dollar Tam.
Greenfield opportunities so we expect that.
Would be a little bit of a shift more towards the subscription deals and keep warm.
Okay, great. Thanks, so much good luck.
Thanks calculator, we're ready for the next question. Please.
Speaker 6: And next we'll get a line of Brad Reback with Stifle. Please go ahead.
And next little line of Brad Rebeck with stifle. Please go ahead.
Great. Thanks, very much Peter as you think about this really large opportunity within professional sports it seems like the.
Speaker 6: Great, thanks very much. Peter, you think about this really large opportunity within professional sports. It seems like the...
The customer experience gain is so substantial what's the gating factor for these.
Speaker 6: The customer experience gained is so substantial. What's the gating factor for these facilities not to move even fast?
Facilities not to move even faster.
Yeah. So look we when we thought about our business.
Speaker 3: Yeah, so look, when we thought about our business, we thought about the $18 billion unserved pants.
We thought about the 18 billion dollar Unser, Pam, which are those people that thought about security, but didn't want to take the only technology available at the time, which is the metal detector. So they ended up doing nothing and we began our business going after that market. The truth is we.
Speaker 3: which are those people that thought about security but didn't want to take the only technology available at the time which is a metal detector so they ended up doing nothing.
Speaker 3: and we began our business going after that market. The truth is, we found great success now in professional sports, which is the other regulated area, others in prisons and aviation.
We found great success now in in professional sport, which is the other regulated area other than prisons in aviation.
Speaker 3: So, now that we've made really good progress with some of the teams and the fan experience in those stadiums is so different.
So now that we've made really good progress with some of the team and the fan experience in those stadiums is so different than the other fan experiences and the other team.
Speaker 3: than the other fan experiences in the other teams you know obviously the physical security people know each other from each of the teams they're talking to each other uh... and we think there's going to be a lot of momentum across the league all the leagues in professional sports
Obviously, the physical security people know each other from each of the team they're talking to each other and we think there's going to be a lot of momentum across the leagues all the leagues in professional sports.
Speaker 3: that's gonna drive a lot of business for us, phone for us. So we're really excited about that. So excited that we're standing up a professional sports division.
That's going to drive a lot of business for us going forward. So we're really excited about that so excited that we're standing up a professional sports division.
Speaker 3: We just hired a world-class executive.
We just hired a world class executive.
Speaker 3: formally with the with the net knows the space really well And we're gonna aggressively go after this market and of course, you know, you have to win at the at the league level
Formerly with the with the nets note the space really well.
And we're going to aggressively go after this market and of course, you have to win at the at the league level.
Speaker 3: But you also have to go stadium to stadium. So having people in every geography and every theater that can support and call on these stadiums is really important. We're excited about what that's going to mean. And I think you'll see over the next quarters and years this being a really big part of our business. And you know, as I mentioned in my comment.
But you also have to go stadium stadiums, so having people in every geography in every theater that can support and call. On these stadiums is really important we're excited about what that's gonna mean, and I think you'll see over the next quarters and years this being a really big part of our business and as I mentioned in my comments.
One of the biggest values of the professional sports is all the eyeballs that go into those gains whatever sport. We're in that translates intersected different experience for them that they go back and if they are a decision maker in a performing arts venue earn a theme park. They want to have that same experience and we get that inbound calls.
Speaker 3: One of the biggest values of the professional sports is all the eyeballs that go into those games. Whatever sport we're in, that translates.
Speaker 3: into such a different experience for them that they go back and if they're a decision maker in a performing arts venue or in a scene part, they wanna have that same experience and we get that inbound call. So it has a forced multiplier effect in terms of people walking through the system and having this transformative experience. So we get a tremendous benefit, not just growing revenue in professional sports.
So it has a fourth multiplier effect in terms of people walking through the system.
Having this transformative experience so we get a tremendous benefit not just growing revenue in professional sports, but getting that exposure.
Speaker 3: but getting that exposure through the number of people that go to the stadium. So we're excited about it.
Through through the number of people that go to the stadium. So we're excited about it.
Speaker 6: That's great. And then it wouldn't be a conference to call nowadays if someone didn't ask about hardware and supply chain. So maybe you can give us an update on where you guys stand in your ability to procure the necessary hardware to need orders for the rest of this year and into next. Thanks. Thanks Brad. This is Peter Favare. Again, as we talked about last quarter.
That's great and then it wouldn't be a conference call Nowadays if someone didn't ask about hardware and supply chain. So maybe you can give us an update on where you guys stand in your ability to procure.
The necessary hardware to meet orders.
For the rest of this year and internet. Thanks.
Thanks grab this is peter for their again.
As we talked about last quarter.
Speaker 2: We're still identifying long lead-time items. We're aggressively placing purchase orders against those through our contract manufacturer. And we're trying to stock up on raw materials inventory.
We're still identifying long lead time items were aggressively placing purchase orders against those through our contract manufacturer and we're trying to stock up on raw materials inventory.
Speaker 2: And I think from a raw materials perspective, we're in great shape through at least the midpoint of 2022. That said, the supply chain issues continue.
And I think from the raw materials perspective were in great shape through at least the midpoint of 2022.
That said the supply chain.
Issues continue.
Speaker 2: And as we ran into 2022, we're going to continue with that same approach.
As we ramp into the 2022, we're going to continue with that same approach.
Speaker 2: but some of these supply chain issues, as we're scaling, may not allow us to aggressively stock up on these raw materials like we were able to do this here. So it remains to be seen or in good shape for now, and we're still actively managing the process.
Some of these supply chain issues as we're scaling.
May not allow us to aggressively stock up on these raw materials like we were able to do this year.
So it remains to be seen in good shape for now and we're still actively managing the process.
Great. Thanks, a lot.
X breath C. At the conference this quarter next.
Speaker 7: Thanks Brad, see you at the conference this quarter. Next question please, Opera.
Next question please soccer.
And once again, if you'd like to ask a question. Please press one them zero at this time next question comes from the line of Sandy boundaries with Credit Suisse. Please go ahead.
Speaker 2: And once again, if you'd like to ask a question, please press one then zero at this time. Next question comes from Linda Sandy Bondry with Credit Suisse. Please go ahead.
Hi, Thank you for the question.
Speaker 8: Hi, thank you for the question. So you open.
Oh.
Speaker 8: with some of the drivers of your business. And I think one of the most critical, because I said, much of the strength of your business is the post-COVID recovery, died in a controversy, organic, and the cost of, you know, keep the city course on a bad end. You guys are gonna see anyways in your business, so that's, that's question number one.
With some of the drivers of your business and I think one of the most critical.
I said.
Each of the strength of your business is the post copay COVID-19 breakup.
<unk>.
Versus the organic and.
Discerning cautious in a band and you guys were going to see anyways and your business pushing.
Number one.
Speaker 8: Question number two is when you're about five, the five deals that were $1 million plus, how many of those actually can include a channel part?
<unk> number two is about five five deals that were $1 million plus how many of those actually include a channel partners and deluxe, specifically trying to get it or try to figure out is is Motorola an enabler for you to push deals that are much larger than you really ever seen before.
Speaker 8: And what I'm specifically trying to get it or try to figure out is is Motorola and Enable are for you to push deals that are much larger than you really have received before. Maybe clarification and color on that. And come up with that because start with those two first and then roll into the other.
Maybe clarification and color on that and how 'bout that we can start with those two first enrolled into the others.
Speaker 3: Well, first of all, welcome and thanks for your question. Your first question broke up a little bit, but let me see if I had it right, if not, ask me again. So, a couple of big kind of secular tailwinds, impacting the growth that we're having in the demand and the business. Number one, everyone during the pandemic has gone through an accelerated digital transformation in every part of their business. Well, that's what we do for physical.
Sure.
Well first of all welcome and Thanks for your question. Your first question broke up a little bit, but let me see if I if I have it right if not asked me again.
So a couple of big kind of secular tailwind impacting the growth that we're having in the demand in the business.
Number one everyone. During the pandemic has gone through an accelerated digital transformation in every part of their business well, that's what we do for physical security right. We take that dumb analog device called the metal detector and transform it into a digital platform.
Speaker 3: Right, we take that dumb analog device called the metal detector and transform it into a digital plot.
Speaker 3: And so that accelerated, I think, people thinking about when it was time to return.
And so that accelerated I think people thinking about when it was time to return.
Speaker 3: they knew that their employees, their fans.
They knew that their employees their fans.
Speaker 3: their patrons wanted to return in a different way and digitally transforming their platform.
Their patrons wanted to return in a different way and digitally transforming their platform.
Speaker 3: and their threshold allows them to do that in a touchless way. So we've gotten the benefit post pandemic of people having the time to rethink how they want to do security in their venue and when they understand that we can not only increase their security posture, but make their lines go away.
And their threshold allows them to do that in the cut to us way. So we've gotten the benefit of post pandemic of people, having the time to rethink how they want to do security in their venue and when they understand that we can not only increase their security posture, but make their lines go away and make sure that the.
Speaker 3: and make sure that the experience starts that you walk right into the venue without breaking strides and nobody has to touch your belongings. Well, that's transformative for every venue, which is why we're having such great success as North America is opening up. And we see hundreds of thousands of thresholds or places that are going to want us going forward. So excited.
Experiences that you walk right into the venue without breaking stride and nobody has to touch your belongings lacks transformative for every venue, which is why we're having such great success as North America is opening up and we see.
Hundreds of thousands of thresholds are places that are going to want us going forward. So we're excited about that most of the reopening and our business is happening in North America right now and the international market Bill has a bit of a COVID-19 hangover as that begins to open up next year we.
Speaker 3: most of the reopening and our business is happening in North America right now and the international market still has a bit of a COVID hangover as that begins to open up next year we expect to feel that same kind of momentum. So the combination of digital transformation, the pandemic, people wanting to return in a new way without any friction and a touchless experience and then get into the venue and be safe.
Checked the field that same kind of momentum so the combination of digital transformation. The pandemic people wanting to return in a new way.
Without any friction and a parts list experience and then get into the venue and be safe safe from the anxiety and the the proliferation of weapons in North America. There are 200 million guns in North America when people get together they want to get together or know their fate from all kinds of threat not just COVID-19.
Speaker 3: say from the anxiety and the the proliferation of weapons in North America. There were 100 million guns in North America. And when people get together, they want to get together and know they're safe from all kinds of threats, not just COVID-19, but also people that have a weapon on them. And that's what we do.
But also people that have that have a weapon on them and that's what we do form. So we're excited about what the ahead of us.
Speaker 3: So we're excited about what the head of us, everyone, these secular tailwinds, are impacting all the verticals we're focused on, and we're seeing great traction, and there's a lot of room.
Everyone. These secular tailwind are impacting all the vertical we're focused on and we're seeing great traction and there's a lot lots of room there.
The second question I think was about these number a million dollar deals and getting them through the channel so out of those $5 million deals that we did.
Speaker 3: The second question I think was about these number of million dollars deals and getting them to the channel. So out of those five million dollars deals that we did, three of them were with the channel and two of them were direct. And yes, the answer is companies like Motorola, Stan Lee's, Lackendacker and JCI, they have been selling to many of the professional sporting teams.
Three of them more with the channel and two of them were direct.
And yes.
The answer is companies like Motorola and leave Black and Decker and JCR. They have been selling too many of the professional sporting teams schools theme parks for years, they've been selling lots of security equipment and lots of other equipment. They have contracts they have relation.
Speaker 3: schools theme parks for years. They've been selling lots of security equipment and lots of other equipment. They have contracts. They have relationships. And so it gives us really not only access, but a fast path.
Chips and so it gives us really not only access but a fast path to deploy our system. So we expect those partnerships to play an increasing role in helping us penetrate professional sports amateur sports, but all the other venues that they have a great position in like school.
Speaker 3: to deploy our system. So we expect those partnerships.
Speaker 3: play an increasing role in helping us penetrate professional sports and amateur sports, but all the other venues that they have a great position in. Like schools, Motorola has a phenomenal position in the federal government, right? And we want to work with them to make sure that we can reach...
Motorola has a phenomenal position.
In the federal government right and we want to work with them to make sure that we can reach.
Speaker 3: all the markets and the federal government that we haven't staffed for yet. So yes, we're expecting these partnerships to give us.
All the the markets and the federal government that we that we haven't staff for yet so yeah. We're expecting these partnerships to give us.
Reach.
Speaker 3: both in vertical and across the globe that we're not going to do organically, and we're thrilled about that. Got it. I think it's even.
Both in vertical and across the globe.
Not going to be organically and we're thrilled about that.
Got it thank you for your color.
Speaker 8: Okay, and then, so thank you for clarifying that. And, you know, five 1 million R plus deals versus, I think you, but I believe you said none versus the prior year. Is there an internal bar or expectation on number of 1 million R plus deals that you guys want to hit on a quarterly basis? Go forward.
And then so thank you for clarifying that and.
Five $1 million plus deals versus thank you I believe you said none versus the prior year is there an internal our our expectation on number of $1 million plus deals that you guys want to hit on a quarterly basis for it.
Speaker 3: you know, we track all the metrics that you might imagine, all the SaaS metrics.
We track all the metrics that you might imagine all the SaaS metrics, because we're SaaS company. That's one of them with his number a seven figure deal. So we're excited about what our pipeline looks for that and all the leading indicators like hsp growing sales cycle can track.
Speaker 3: because we're a fast company. That's one of them, which is number of seven figure deals. So we're excited about what our pipeline looks for that. And all the leading indicators like ASP growing, sales cycle contracting, upsell opportunities with our customers, all those metrics, including seven figure deals we tracked, and we feel very good about what's ahead of us.
Acting up sell opportunities with our customers all those metrics, including seven figure deal we track.
And we feel very good about what's ahead of us in terms of the pipeline.
Speaker 3: In terms of the pipeline, what's really interesting is because the competitive landscape is not...
What's really interesting is because the competitive landscape.
Is not.
Very aggressive right now.
Speaker 3: very aggressive right now. We like to have three times the pipeline in the four recorders to feel comfortable about landing our numbers.
We'd like to have three times, the pipeline and the four quarters to feel comfortable about landing our numbers. So.
Speaker 3: So we have a really good marketing team and channel team helping us build that pipeline. And at the end of the quarter, the deals that we don't get, we may lose a few, but we don't lose a few to competition. We lose a few to no budget.
So we have a really good marketing team and channel team.
Helping us build that pipeline and at the end of the quarter the deals.
That we don't get we may lose a few but we don't lose the few to competition, we lose the few to no budget.
Speaker 3: But the deals that we don't get in the quarter typically move to the next quarter.
But the deals that we don't get in the quarter typically move because the next quarter.
So we have this really great corpus of pipeline deals to go after every quarter and if it doesn't close this quarter than normal mode of the next one and.
Speaker 3: So, you know, we have this really great corpus of pipeline deals to go after every quarter and if it doesn't close this quarter then it normally moves from the next one. And it gives us a lot of confidence that we can continue to grow at the rate that was growing.
And it gives us a lot of confidence that we can continue to grow at the rate that we're growing.
Got it and then my last question is that technology related question does the false API or information flow flow directly into say, a Motorola command center type software suite or is it currently an independent.
Speaker 8: Got it. And then my last question is the technology related question. Does the E-Fall API or information flow directly into say a Motorola command center type software? Or is it currently an independent pane of glass type of software or web page interface?
Pane of glass type of.
Software or web page interface.
Yeah.
Great. Great question. So we have an open API, which is one of the things I didn't mentioned in my remarks is because we're at digital platform and we have an open API, we can connect into both the physical and cyber infrastructure that we go into so think about connecting to Motorola BMS sit.
Speaker 3: So we have an open API, which is one of the things I didn't mention in my remarks is because we're a digital platform and we have an open API, we can connect into both the physical and the cyber infrastructure.
Speaker 3: that we go into. So think about connecting to...
Speaker 3: Motorola's the MS system, their video analytics capability, their license plate readers, that whole
From their video analytics capability their license plate readers that whole lineage of premium products that they have we can connect to so specifically with our open API, we can send an alert to a motorola stock.
Speaker 3: lineage of premium products that they have. Weakness to neck.
Speaker 3: So specifically, with our open API, we can send an alert to a Motorola stock.
Speaker 3: and had that connection happen immediately. So yes, that's available for Motorola, but also through all the other partnerships that we're building as well. That open API allows us to integrate.
And have that connection happen immediately so yes, that's available for Motorola, but also through all the other partnerships that we're building as well that open API allows us to integrate.
Speaker 3: into the physical and the cyber infrastructure of all the different echo systems that customers deploy. But we're excited about what it's gonna mean for the partnership of Motorola, because they're creating some premium products on our platform that are gonna be really unique and compelling and differentiate them in the market in a way that we're excited about, and I know they are too.
Into the.
Physical and the cyber infrastructure of all the different.
<unk> system that customers deploy but we're excited about what it's going to mean for the partnership with Motorola because they're creating some premium products on our platform that are going to be really unique and compelling and differentiate them in the market in a way that.
We're excited about it and I know they are too.
Got it alright, thank you.
Speaker 7: CME, thanks for those questions. I'll look forward to participating in the conference, the credits for this conference next month. But later this month, I should say, Operator, I think we have time maybe for one more question.
Sami Thanks for those questions will look forward to participating in the conference Christmas Conference textbook, but later this month I should say upright I think we have some medical one more question.
And the next question comes from the line of Brian Ruttenberg with Imperial capital. Please go ahead.
Speaker 2: And the next question comes to the line of Brian Ruttenberg with Imperial Capital. Please go ahead. Yes.
Yes, thank you very much.
Speaker 5: Okay, hopefully I'm coming for it. Yes, we can hear you, Brian . Go ahead. Yeah, I'm getting weird feedback.
Okay, hopefully I am coming through yes, we can hear you Brian go ahead.
Yeah, I'm getting weird feedback so I apologize.
So in terms of EPS, you had been giving guidance.
Speaker 9: So in terms of EPS, you had been giving guidance.
Speaker 9: of 80, loss of 80 cents, the loss of 75 cents on 84 million shares outstanding. Is there an update to that?
Of a loss of 80 cents a loss of 70 584 million shares outstanding is there an update to that.
Speaker 7: Yeah, just on the EPS in general, we booked all of our D-SPAC transaction accounting entries, obviously when we closed the deal.
Yeah, just on the EPS in general re booked all of our dates back.
A transaction account.
Accounting entries, obviously, when we closed the deal.
Speaker 7: As part of those entries, we re-evaluated a lot of the derivative liability, urn-out liability, and common stock, contingent common stock liability, balances from the closing date.
As part of those entries, we reevaluated a lot of the derivative liability earn a liability in common stock <unk>.
Contingent common stock liability.
Balances from the closing date.
Speaker 7: So the big swing in EPS is really around
So the big swinging EPS is really around.
Booking those gains based on the reduction in the stock price and so that was the big swinging the EPS from the loss to the game.
Speaker 7: booking those games based on the reduction in the stock price. And so that was the big swing in the EPS from the loss to the game.
[noise] Great do you have an update on a year for adjusted.
Speaker 9: Great, do you have an update on year for Jeff did?
Speaker 9: or gap EPS? Yeah, we don't really want to talk about it because obviously the stock volatility is outside of our control, so it's really tough to forecast that for the year.
<unk> our gap EPS, Yeah, we don't really want to talk about it because obviously the stock volatility is outside of our control. So it's really tough to forecast that for the year.
Well I guess I'll ask why he hasn't really sorry.
Speaker 7: All I can say is that the EPS wing is not coming from operations which really coming from these technical accounting.
Sorry, the upswing.
It's not coming from operations, it's really coming from these technical accounting entries.
Okay understand the last question is on Disney trial.
Speaker 7: Okay, understand. Last question is on Disney Trial. Can you give us an update on whatever happened with the Disney Trial? Is there still ongoing trials? And what is the overall status there at the same point?
Can you give us an update on whatever happened with the Disney trial is there still ongoing trials and what is the overall status there at the theme parks.
We're not to.
Speaker 7: word not only you know what so brine this is brine norse i don't know that we've ever discussed that as a as a as a customer the company obviously we're very focused on the theme park space in general and i think our technology plays very well there more certainly excited to continue to expand our leadership position in the theme park vertical uh... in all parts of the country how about
So Brian this is Brian notice I don't know that we've ever discussed that as a customer of the company. Obviously, we're very focused on the theme park space in general and I think our technology plays very very well. There are certainly excited to continue to expand our leadership position in the theme park vertical.
In all parts of the country how about that.
Okay. Thank you very much.
Speaker 5: Okay, thank you very much. Hey, Brian , any other final questions there? Anything else we can help you with? Otherwise, we'll look forward to seeing you in December at your conference in New York.
Brian any other a final question was there anything else. We can help you with otherwise we'll look forward to seeing you on December conference in New York.
Yes. Thank you very much that's it.
Eric is there any other questions that we get that all of them I think we did and we have no further questions in the queue at this time.
Speaker 7: Eric, are there any other questions that we get to all of them? I think we did. And we have no further questions in the queue at this time.
Terrific, Okay, well on behalf of Peter and Mario and Peter and the whole management team and all employees of a ball. We thank you for participating in this evening's call we look forward to.
Speaker 7: Okay, well on behalf of Peter and Mario and Peter and the whole management team and all employees of the ball we thank you for participating in this evening's call we look forward to reaching as many of you as we can and our outreach period again we're at three conferences during the period. Feel free to reach out to me at Bnorra City of all technology for more information.
Reaching as many of you as we can in our outreach period again three conferences during the period.
Feel free to reach out to me at B, nor is sort of all technology for more information. Thank you so much.
And ladies and gentlemen that does conclude your conference for today. Thank you for your participation in for using ATT teleconference. You may now disconnect.
Speaker 2: and ladies and gentlemen, that does conclude our conference for today. Thank you for your participation and for using ATT teleconference. You may now disconnect.