Q3 2021 Kaltura Inc Earnings Call
[music].
Good morning, everyone and welcome to the culture of third quarter 2021 earnings call for opening remarks, and introductions I will now turn the call over to Erica Mannion of Sapphire Investor Relations. Please go ahead.
Thank you and good morning with me today from Cal Tour, Iran. Yoga, two co founder Chairman and Chief Executive Officer, and Iran commodity Chief Financial Officer.
Ron will begin with a brief recap of calories mission and market opportunity and with a summary of the business results for the third quarter ended September 32021.
Ron will then review the financial results for the third quarter, followed by the company's outlook for the fourth quarter and full year of 2021, we will then open the call for questions.
Please note that this call will include forward looking statements within the meaning of the federal securities laws, including but not limited to statements regarding <unk> future financial results and management's expectations and plans for the business.
These statements are neither promises nor guarantees and involve risks and uncertainties that may cause actual results to differ materially from those discussed here.
Courtney factors could cause actual results to differ from forward looking statements can be found in risk factors section of Cal tours quarterly report on Form 10-Q for the period ended June 32021, and other periodic SEC filings, including the quarterly report on Form 10-Q the period.
Ended June 30th 2021 to be filed with the SEC.
Any forward looking statements made in this conference call, including responses to your questions are based on current expectations as of today and <unk> assumes no obligation to update or revise them, whether as a result of new developments or otherwise except as required by law.
All material contained in the webcast is the sole property and copyright of <unk> with all rights reserved. Please note. This presentation describes the non-GAAP measure adjusted EBITDA, which is not prepared in accordance with U S. GAAP for a reconciliation of this non-GAAP financial measure to the most directly comparable GAAP metric. Please refer to our earnings.
Please.
Now I'd like to turn the call over to Ron.
Thank you Erika and thanks to everyone for joining us on the call. This morning.
We're excited to report quarterly earnings for the second time as a public company.
I'll start this morning, with just a few opening financial highlights from the third quarter.
Because some of you may still be new to the cold tourist story I want to provide a brief recap of our mission and market opportunity.
After which I will provide more details on the passing quarter.
We reported a strong third quarter revenue for the quarter was $43 million up 40% year over year and above the high end of our guidance of $42 5 million.
Subscription revenue for the quarter reached $37 7 million and.
An increase of 40% from the prior year and represented approximately 88% of total revenue.
Our annualized recurring revenue.
Grew to 151 7 million.
Up 41% year over year.
And our net dollar retention rate was 117% up from 111% one year ago.
We also continued improving our gross margin across both reported segments and achieved a gross margin of 65% in the quarter.
Our adjusted EBITDA was negative $2 3 million also ahead of the high end of our guidance.
As we look to the future of customer experiences, we're learning and entertainment in a world reshaped by the pandemic.
Video technology and video experiences continue to emerge.
Primary facilitator for change.
Video technology now serves as a foundation for remote work remote learning virtual events and online entertainment, replacing travel in person meetings office space classrooms, and event venues and much more.
Enabling everyone to participate from everywhere.
<unk> mission is to power any video experience for any organization.
Our video experience cloud drives communication collaboration learning virtual events and entertainment experiences for millions of people at work at home and at school.
We cater to date to four main markets.
Enterprises for all major industries, including more than 25% of the U S Fortune 100.
To whom we deliver our video portal town home video messaging Webinars and virtual events.
Internal communication and learning as well as digital marketing and customer experiences.
Education institutions, including more than 50% of the top U S research educational institutions and seven of the eight Ivy League schools.
To whom we deliver video solutions for in class and remote teaching and learning, including video extensions for learning management system.
Electric capture solution and a virtual classroom solutions.
Technology companies to whom we provide our immediate services, which are broad set of on demand live and real time video API as an experienced components.
That enable them to launch new video products or add rich video workflows to their existing products.
And lastly media Telecom company for.
For which we provide streaming media and cloud PV solutions.
For both subscription based and AD supported services.
We sell our solutions primarily through direct sales teams that account teams that are also organized based on these four customer markets.
And reported based on two segments.
E&P segment, which combines the first three markets.
And the M and P segments, which represent the last market.
Often involves longer sales and deployment cycles.
In recent years, we've been accelerating our revenue growth rates.
Also improved our adjusted EBITDA without materially increasing our sales and marketing spend.
We achieved this through an increase in sales efficiency fueled by our growing product portfolio and by heavier adoption of video experiences across our markets.
In recent months, we started expanding our sales force and expect it to continue to fuel our future growth.
Along with the planned increase in marketing spend.
Our growth is also supported by the increased adoption of our most recent product releases, including virtual events Webinars and virtual classroom and is expected to also be boosted by our planned move down market to power's smaller organizations with low touch and self serve products.
Coupled with an associated expected increase in sales through channel partners.
We are pursuing an inspiring and timely mission.
Believe we have unique sustainable advantages.
And are very excited for the future.
Now returning to the third quarter of 2021.
From a go to market perspective, and starting with our E&P segment.
In the third quarter, we continued to see an increase in the average <unk> per customer and in the average size of new deals.
We also continued with our global expansion with a greater portion of new bookings coming from EMEA, and APAC compared to last quarter and last year.
So North America remains our largest market.
We saw continued growth in the percentage of new business that is coming from channels.
As well as continued reduction in the proportion of book New professional services versus subscriptions.
As our new E&P offerings continue to mature and require shorter deployment cycle.
We secured new customers, including Fortune 500 companies and universities the purchased a wide array of our products, including our newest product and solution additions of Webinars virtual classroom and virtual events.
Pertaining to our your offerings this quarter Gardner issued their 2021 magic quadrant for meeting solutions and the 2021 critical capabilities for meeting solution Companion report, which included culture off for the second time since we launched our real time conferencing offering last year.
We were excited to be recognized as a visionary in the magic quadrant and to be ranked fourth in the critical capabilities report and the external presentation used case and fifth in the Webinars as well as the training and learning use cases.
So Terry has a unique approach to meeting solution market.
We address the complexities of meetings that go beyond the standard video call, which we referred to as meetings with purpose such as virtual events Webinars and virtual classrooms.
Our powerful tools for content management and integration with enterprise workflows based on our underlying market, leading video content management platform.
<unk> was previously named a leader in the Gartner Magic Quadrant for Enterprise video content management Research reports since 2013 for five consecutive times and ranked highest in all use cases in the last published critical capabilities for enterprise video content management report.
Gartner just continued the publication of these reports by 2019.
Our strengths and addressing meetings with purpose helped us secure new customers and expand our business with existing customers in the third quarter, such as one of the largest global accounting firms in the world to replace its existing solution with cultura to power their remote employee training and development all across the globe.
We also signed up new universities in the U S and worldwide.
<unk> to address their media content management and virtual classroom needs with a single platform.
Our virtual event platform to build on our broad video technology stack combining live <unk>.
<unk> live real time and on demand video enables us to successfully power complex virtual events and become a leading central virtual events platform for enterprises for all of their events large and small.
We're continuing to onboard new customers and up sell to existing one in this very exciting market.
While on the topic of virtual events.
We are thrilled about our upcoming virtually live event on November nine we will host a tremendous lineup of marketing executives.
From Microsoft.
Oracle Youtube Accenture Doc you sign drift hubs Buck NASDAQ at lesion and many more.
This virtual event will talk about the future of marketing and virtual events.
And also showcased the latest and greatest of Coke towards virtual event platform.
Sure at the register and attend virtually live and to also read our.
A virtual event 2022 report, which we're releasing tomorrow covering user and buyer preferences in this market based on feedback for more than 1200 responses to our survey we put out.
Continuing with the N T.
Oracle announced in the third quarter that they are expanding the strategic agreement that they had signed with us in 2019.
<unk> video capabilities into their products using our media services.
This original OEM agreement with Oracle included only our video content management capabilities and.
And the extended agreement.
All of our capabilities.
<unk> live stimuli and real time video experiences.
Brooklyn has been a customer of <unk> since 2012.
Using our video portal and town halls for internal employee engagement as well as external customer education.
As part of the partnership expansion with Oracle, We've also undertaken to host all of Oracle related workloads on the Oracle cloud infrastructure.
This will enable oracle salespeople to sell through our products and solutions hosted on Oracle cloud.
We're extremely excited about the huge potential of this partnership.
We also.
<unk> planned to continue growing our strong partnership with AWS or cloud provider and go to market partner that has been powering all of our SaaS customers. For example, we powered virtual events for a leading HCM platform as well as the Fortune 500, consumer electronics company running on AWS.
With regards to our go to market efforts and the M and P segments.
We're continuing our ship from mainly targeting larger telcos to also targeting smaller telcos broadcasters and media companies with direct to consumer offerings.
The majority of our new business in the third quarter came from these markets. It is a healthy shift because it increases our addressable market shortens, our sales and deployment cycles and continuous reducing the amount of required professional services.
Also the third quarter's new bookings coming from all regions, including a bigger part of the usual from Latin America.
T is still tracking to lead our segments in 2022 in terms of percentage of growth of new bookings compared to 2020.
But because of the length of your deployment cycles.
In some cases the impact on our revenue will not be recognized until late 2022.
Sure both E&P and MLP, we continued building up our sales force in the third quarter, including new sales reps customer success managers and sales support staff.
We are slightly behind our internal hiring plan, but expect to catch up in the coming quarters.
Our forecasted average productivity per salesperson for the year remains of the anticipated levels, which is great considering our growing sales force.
From a technology development perspective.
We are continuing to ramp up developers in order to accelerate our product roadmap.
Five primary activities in the past quarter and near future are as follows.
One.
The launch of our comprehensive second generation virtual events platform that includes a user friendly orchestration and management layer for marketers to easily set up and manage their events.
This platform is well suited for all marketers, who now need to execute on a large number of virtual and hybrid events of all sizes.
This platform is designed to shorten our sales and deployment cycles and reduce required professional services in an effort to help increase gross margins.
True.
To continue advancing our recently added real time conferencing engine to best support our fast growing meetings and event products in an effort to improve unit cost and gross margins.
Great.
Two continued development towards launching our self serve media services Webinars and virtual classroom offerings in the first half of next year.
This move is expected to increase our target market to include small and medium enterprises smaller schools and startups and also to reduce required professional services again in an effort to increase gross margins.
Or.
To enable our services and products to run in OCI as discussed previously.
And lastly, five.
For the <unk> sector to continue working on a more simplified end to end version of our offering for media companies and smaller telcos that would enable us to launch services quicker and without the need to procure separately individual tech stack components.
This is expected to broaden our target market and reduce required professional services again in an effort to increase gross margins.
Our product investment areas are in line with important market trends related to the adoption of video technology across all of our products and use cases.
And we're excited about our upcoming launches and continued market disruption.
In summary, we.
We had a great quarter with strong growth retention rates and gross margins and we're already hard at work on the next quarter.
We're continuing to increase our sales and marketing spend to ramp up additional sales staff.
We continue to be excited about the strong traction that we're seeing for our recent new product and solution releases.
And are excited to launch important enhancements in addition to these offerings.
<unk> lower touch and software products that we expect will open up our target market to include also small organizations to which we could sell and deploy faster with less services and at higher gross margins.
With that I'll turn it over to year Roman our CFO to discuss our financial results in more detail.
Thank you Ron and good morning, everyone.
As they review our third quarter results today. Please note that they would be referring to our non-GAAP metrics adjusted EBITDA.
A reconciliation of GAAP and non-GAAP financial measures included in today's earnings release, which is available on our website.
Total revenue for the third quarter ended September 32021 was 43 million up 40% year over year.
Subscription revenue was 37 7 million up 40% year over year, while professional services.
Revenue contributed $5 3 million up 43% year over year.
Are you.
The remaining performance obligations were $162 3 million up 24% year overview of which we expect to recognize 59% as revenue over the next 12 months.
Annualized recurring revenue was $161 7 million up 41, 41% yield area.
Revenue benefited from our continued.
<unk> gross net dollar retention rate, which was one of them is in 17% in the third quarter compared to 111% in Q3 2020.
Ian do segment total revenue was $30 4 million up 45% year over year subscription revenue was 28 million up 14, 1%.
While professional services revenue contributed $2 5 million up 19, 9% year over year.
And then two segment total revenue was $12 6 million up 13 one.
Year over year subscription revenue was $9 7 million up 37% year over year.
While professional services revenue contributed $2 9 million up 16% yield area.
Gross profit in the quarter was $27 8 million, representing a gross margin of 65% up from 59% gross margin in Q3 2020.
<unk> segment gross profit was $22 2 million, representing a gross margin of 17, 73% up from 72% gross margin in Q3 2000 when we.
<unk> segment gross profit was $5 7 million, representing a gross margin of 45% up from 32% gross margin in Q3 2020.
In the expenses was $12 4 million and 29% of revenue compared to 24% in Q3 2020. The increase was driven by additional headcount and payroll expenses as we continue to invest in technology and innovation.
Sales and marketing expenses were $11 3 million or 26 of revenue compared to 22% in Q3 2020 in total driven by insurance sales and marketing investments, including headcount and personnel related expenses, we intend to continue to <unk>.
Invest in sales and marketing as we expand our citizens.
Since falls and marketing vessels that will leverage our position in the market and capture the significant opportunity in front of SaaS G&A expenses was $10 1 million.
Or 23% of revenue compared to 28% in Q3 2020, the decrease was G&A.
Also one time expense related to abandon.
Data center equipment in Q3 2020 it.
This is offset by IPO related expenses.
And includes the NAPCO and increase in stock based compensation expenses.
Net loss in the quarter was $25 2 million or <unk> six per diluted share adjusted EBITDA was a negative $2 3 million decreasing from $1 7 million in Q3 2020.
This result in line with our plan to increase our spending in order to further fuel our growth as discussed earlier.
Turning to our balance sheet and cash flow.
We ended with.
The quarter, we've won $179 7 million in cash and short term investment.
Preliminary net proceeds from our initial July probably closer in Gulf of approximately 164 million net cash used in operating activities was $5 7 million in the quarter.
I would like now to turn to our outlook for the first quarter and the full year of 2021 for the fourth quarter, we expect revenue to be $41 2 million to $43 2 million, which is in that we've been negative adjusted EBITDA was $7 5 million to $9 five medium.
For the full year, we expect revenue to <unk>.
160.
Seismic going to 165 coincides with the negative adjusted EBITDA of $14 1 million to $12 1 million.
These are both up from our previous guidance in summary, we believe our new products strong pipeline elevated net dollar retention rates and improving sales and marketing resources.
In the last two continuing to support our robust with total revenue growth growth rate and that will increase gross margin are in line with achieving our long term goals.
With that we'll open the call for questions operator.
Thank you we will now begin the question and answer session to join the question queue. You May Press Star then one on your telephone keypad, you'll hear a tone acknowledging your request.
Limit yourself to one question and one follow up.
If youre using a speakerphone please pick up your handset before pressing any keys to west John Your question. Please press Star then two.
We will pause for a moment as callers join the queue.
Yeah.
Yeah.
The first question is from Koji Ikeda from Bank of America. Please go ahead.
Hey, Thanks, guys for taking my questions great great quarter.
Wanted to ask you question about 2022 for a bit here you know we're at the end of 2021 and specifically about your E&P segment, the enterprise education and technology and maybe you could just talk about which one of those three you're most excited about as a growth factor heading into 2022.
You cannot go Jay. Thank you so much and thank you all for joining and by the way one slight correction that I've noticed after that I misrepresented I said that <unk> continues to lead our segment in 2022 in terms of percentage of growth versus 2020, obviously, it's 2021. So that's one small thing.
For your question about 2022, and what we're excited about across all our four areas. We're very excited because they have all been growing very nicely. There was a lot of demand. We've already mentioned that M and T is on its way to grow in the highest percentage of Sierra So we're going to enjoy growth. Both at the end of next year and the following one theres some delay on this.
As far as market demand within the E&P sector I'd say all three are very strong net dollar retention is generally led by tech OEM, followed by enterprise, but I'd say that the most explosive one by way of overall market size opportunity is the enterprise sub sector within E&P. It is the largest one by.
We're booking right now it's the largest one by way of revenue within E&P and it is one that with all the new products that we've started launching and the great demand that we see for them. We expect significant growth then and to remind you. We're also gonna go downmarket towards the SME market with more self serve products, where virtual events and learning and so we.
Spect that to continue to push so I'd say, they're all exciting.
From a size and overall potential I'd say enterprise would be does that answer your question Colby.
That's perfect. Thank you and just one follow up here, if I may I wanted to double click on the on our hiring plan. You stated that you are slightly behind and I wanted to dig in a bit more on that could you quantify or maybe talk about qualitatively about your current sales capacity and how we should be thinking about any sort of catch up there in sales.
And the ramp from here heading into 2022. Thank you.
Yeah happy to do that so you know we don't report specific numbers around sales force size and ramp, but I can say that we've been growing our team very very nicely in E N T.
Ram salespeople and customer success managers grew by 50% in quarter, three compared to quarter, one such a huge jump.
And an M and T. The combination of sales and CSN grew by 20% in quarter three compared to quarter. One. So it's a significant growth that was planned when we say that we're slightly behind it's kind of a single digit type of a lag we expect that to be covered over the next few quarters with a lot more growth that we're putting in place and it's important to remind everybody.
We anticipated that towards the end of the year, we're going to need to pass the baton from growth because of increased efficiency that we've seen over the years to growth also because of more salespeople that are rent and that's something we're starting to see now, but where bookings were gonna see in Q4 and definitely entering 2022.
So that Reacceleration. If you made is is ahead of us and we're seeing early signs and we're excited about Ron do you want to add anything here.
Yeah.
First of all as Ron mentioned, the most important point that the increasing our sales force since the beginning of the year is significant it's like as he mentioned is between 30% to 50% of the sales force.
And we believe that by adding the people that we are adding in catching up with you in Q4 and getting into Q1, we will have the right amount of people to support the growth for next year and at this point is around also.
Also mentioned, we see that productivity level is still remain.
Yeah.
So we definitely don't see erosion in productivity, so by adding the people and we believe that we would see a very nicely increase going into next year.
Got it. Thank you guys. Thanks for taking my questions. Thank you.
The next question is from DJ Hynes from Canaccord. Please go ahead.
Hey, Ron Hey, Ron Great to see the 40% growth across the board congrats.
I want to ask about the bookings environment and execution in the quarter I mean, the qualitative commentary, obviously, you sounded pretty upbeat if I look at the amount of net new IRR you added in the quarter.
It's the lowest we've seen in more than a year. So can you just double click on what you saw in the quarter. I mean is it the last couple of quarters benefited from some of those chunky kind of M&A deals.
Dropping in or maybe just talk about.
Close rates and what the pipeline looks like heading into Q4.
Yeah happy to do that so.
More color so segment wide contribution for all segments.
Largest contributor as I mentioned earlier continues to be enterprise.
Product respective of the large majority of the deals are meetings related so they include live or real time conferencing.
I will say that from a concentration perspective in the past, we'd add much more push and both booking and revenue coming from a single fuel very large customers that's not the case now.
On Centralia, and you've seen that in our comments are coming down you will see that in the 10-Q as well Vodafone year to date is under 10% versus last year, though was a 12% Amazon came down to single digits top 10 customers are sliding down from Q2. So that's good from an RFP perspective.
E&P new deal ARPA grew to the highest level this year.
So we're seeing this mainly driven by the new products virtual events and virtual classrooms, where large companies are bigger ticket item. So we are seeing bigger and bigger deals come in.
Already mentioned from how we closed the deal insofar as productivity.
They have been.
<unk> forecasted for 2021 to continue to be strong they continue to be as planned we.
We don't report LTV to CAC, but I can tell you that it's still very strong.
We did tell you that we've grown our salesforce in the numbers that we've said, it's just a question of catching up a bit slightly more I mean I could give you examples.
New logos and enterprise.
A lot of meetings related stories, but just a couple of not meeting examples we had two fortune 500 companies when a very large retail companies. The other very like shipping and business service companies, both integral Gerard to manage all of their externally facing videos on their website to support marketing and E Commerce workflows.
<unk>, we're seeing folks purchasing solutions that are combined between content management together with the new virtual classroom and also integrated with things like Microsoft teams zoom.
In media we stopped.
Stahl more media companies like the biggest kids channel in a European country launching would go through a new app based direct to consumer offering and a bunch of upsells.
Virtual event side.
One of the largest chip manufacturers just conducted their second virtual event with tens of thousands of folks one of our biggest customers that have been using us extensively at the added a bunch more events smaller ones with our platform that supports both large and small I mentioned earlier.
Very big accounting firm that joined us.
And they've replaced an existing vendor for learning development Theres a lot of great. We did mentioned Oracle for the Tech OEM expansion.
There is a lot. So I think it's a good quarter very rich very well diversified.
It wouldn't take too strongly on some shifts between this quarter and the other by way of bookings. That's why we don't report on it catches up Q4 is generally a very very strong quarter Q2 was also strong because of one mega large deal in MMP, sometimes they take a while and they come a bit. After so these are some of my thoughts Youre wrong, you want to add anything.
You ask about the fact that the E U.
You'll see a slow growth.
So for this quarter. So in general we are focusing from the beginning of deal we were focused team.
The growth slowdown for the second.
It will be some slowdown and this is because of the fact that we have we have maximize the effect of improving defense for productivity and now mainly the turnarounds, which we discuss it from day one is coming from the fact that we are adding more and more people and we will see the impact going into Q4 bookings.
In the beginning of next year and then as Don mentioned typically Q4 is a very strong bookings in the new salespeople that we are adding we believe this is a week later very interesting effect going forward at the same time, we are not reporting on a specific deal, but we are negotiating some big deals that hopefully will be able to close.
So to make a long story short.
We got we guided this kind of slowdown and they are all global from day, one almost but we are taking all the actions in order.
To Reaccelerate. Its again was always from the pain and we see that is going to radically.
Yes, Okay very helpful color.
One follow up Ron I'd Love to get your your thoughts on kind of the efforts to drive more self serve buying I mean, just maybe you could talk about what youre doing to make that happen right you talked about some of the product that makes sense, but how do you layer that into the go to market motion right I feel like we often see folks layer direct sales efforts on top of self serve but it's less com.
Gonna see it go the other way so I'd love to get some color there.
Yeah. So we've been that we've been talking about this for a while working on our self service solutions that are expected to launch in the first half of next year.
Our book South in Paas solutions, both solutions for internal use for learning development and external for Webinars virtual event cetera, as well as the platform as a service for developers.
The main work we need to do is.
Adding the right internal workflows that are tying all the way from a marketing or registration and some self support self care and stuff like that we're hard at work on that we expect that to launch we're not going to go all the way down to Smbs, we're definitely not targeting consumers on its expected to be smbs.
The world of media will come to intermediate sized media companies in the world of developers will be startup.
But we expect that to be a material change for what we're doing.
We feel very confident about this move but one of the things that we started doing more of this quarter, we're going to do a lot more than that next quarter to start working on more spend on marketing and you're going to see the whole funnel all the way from the top of the funnel on digital campaigns.
That are promoting our brand in promoting our solutions. We brought people that are experts in this from other companies, we're putting funding towards this even a bit in advance of the actual launch of these products and we feel that we are going to be well equipped to do that and to be clear part of it is also making departmental sales for the larger organizations that we're working.
With any way as opposed to cutting as a unified sales from a CIO perspective with full FTE coverage and definitely we have a strong suit on that side.
To address your question.
It totally makes sense and again very helpful. Thank you guys.
Okay. Thank you.
The next question is from Michael <unk> from Wells Fargo. Please go ahead.
Hey, guys. This is awesome winds on for Michael Thanks for taking our question. So it looks like the revenue growth in the quarter grew 3% sequentially, but the guide implies down roughly about 2% sequentially at the midpoint. Despite it being a <unk>. So one of the drivers that sequential step down and is there any color you can give on the split.
Between subscription and professional services.
Yeah.
Good question. Thank you for asking me, yes, we said it before in the previous calls and we are seeing it again.
Because of the fact that we added a significant nonrecurring revenue.
In previous quarters related to the fact that the.
Yeah.
Some of the big virtual events in the world.
A lot of.
Second part of your nonrecurring revenue, it's not going to happen this quarter, we saved it.
Before.
So this is one of the reasons for the decrease.
Hopefully we will work out to beat these numbers, but I already elaborated on the fact that the.
We are already being mobile people, so we need it.
The impact on the coming quarters is definitely going to change from this direction.
Other than that.
And I don't think that.
Anything to add.
But the.
There is also some big deals that we are negotiating right now that also can contribute for the future growth.
So to make a long story. The main point is obviously, there's normally kind of revenue that was very significant and it's not going to be this quarter.
When we're looking only at the only recurring revenue. The fact that we are adding the people. The fact that we're going to beat the numbers and some of the big deals that we have.
Related to the acceleration of the growth will continue into the future.
Yeah, I'll, just add and thanks for the good question.
Other than the fact that we've been saying this since the beginning of the year because we knew the nonrecurring fees for Q4 is not going to come back.
And the fact that there is a certain expected slowdown that's gonna be catapulted by salespeople is what.
What we've guided for Q4 revenue numbers.
Is equal to what we've done kind of before and so we're maintaining kind of the deemed at mid range. If you kind of run the annual expectations that we put earlier and you kind of run what Q4 would have meant.
That hasnt changed were maintained in Q4, we just increased the range a bit to allow for swings up and down.
But otherwise we haven't changed them for the full year, we increased the full range by $1 million.
So we basically up the full range and for the year and maintained Q4, and let's see where it takes us we always want to be cautious.
Okay. That's helpful color.
And then just as a follow up the it looks like the gradual gross margin improved pretty nicely over the prior quarter and the prior year I just wanted to unpack that a little bit more usage and impact here driving the improvement or were there any other major drivers to call out in either segment.
No no the main driver the main driver.
As we told everybody before we are going to focus heavily in improving the system, especially post COVID-19.
So I don't think it's related so much to the market impact.
Some of the actions that we are.
Taking and you can see that by the way in the enterprise application and Tech OEM.
We made some mileage.
In the way of improving the numbers, but we are still not where we want to be which is the number of pre COVID-19. So do we still have room for improvement.
Despite the fact that we improved gross margin and authentic.
T from 70% to 73% the big change was the media and telecom.
Always say that there is a lot of film doubtful improvement.
We improved from 42% to 345% and when you look from the compared to the quarter last theory from 42% to 45%.
And by taking some of the other actions, including a reduction of the size of the non recurring revenue. We believe that we will Steve is there room to grow.
Most of the actions are related to what we did in the company to improve and to continue to improve.
Not going we're not committing thats right now we will continue to be for the short term again, 65% because obviously when we discussed before it was the ICC is low sixes and now we had 65% after we had 62 in last quarter.
But we are definitely going to see it continue to improve above below 60 is going into the rest of deal and especially for next year.
And and we will provide more detailed guidance when we get to.
At the beginning of next year.
I'll just add that one of the good things that we're seeing and we've been targeting and we're building our products for that is the continued reduction of the percentage of professional services. So a reduction in nonrecurring, it's both the media and telecom and in enterprise education in Tech.
And the other one is the growth in usage based pricing.
Coming together with the new products and also a shift of post pandemic, which was great and obviously in general are growing scale introduces lower pricing and an improved economy of scale. So we're definitely expecting to continue to go towards our long term goals with the parentheses around it said, but we do expect to see.
Some jumps in fluctuations in gross margin in the short term the short term, but would not necessarily expect to see better gross margins that could come on but that's back down again in Q4 before it continues to go up but we're very optimistic and working hard towards improving gross margin.
Great. Thanks for the color guys.
Thank you.
The next question is from Matt nickname from Deutsche Bank. Please go ahead.
Hey, guys. Thank you for taking the questions.
One of them.
Bookings from our channel I'm, just curious I guess, where you are today what percent of new business is actually coming from sort of non direct sales and then where you envision this going over time with some of these expanded efforts both in channel and some newer self serve product.
And then maybe as a follow up to the gross margin question.
How do you think about migrating more workflows beyond Oracle specific ones onto the Oracle cloud or other baby public cloud partners beyond AWS, and then would that be sort of a meaningful.
Tailwind for gross margins overtime.
Yes. Thank you.
So first thing is so far as percent of business coming from channel.
Its continue to go up E. N T is actually at the highest recent level that we were it went beyond 10% typically its on a mid single digit. So that's going well MMP is not really a channel business. The most cases, sometimes we do have some channel business coming in so I would focus on E&P. There. So channel is building up the big.
<unk> jumped is going to be when we launch our self serve products and that's next year and we expect that we'll be able to push more things easily.
Through the channel partners. So we have so we're optimistic and it's growing in the right direction and so far as your question about Oracle and maybe at large.
We're excited about the relationship I've mentioned there.
Very valued customer since 2012, we announced the OEM agreement with them in 2019, we've now announced the next step of that which enables both of them.
Live in real time, which enables to push it into more products and there are a lot of big plans.
So that's exciting yes, we arent putting stuff running on OCI to support that and we are enabling oracle salespeople to offer called for our products.
To Oracle customers.
That's not in order to improve gross margin and it's not in order to migrate them from AWS, we continue to be a very very good partner to AWS.
Important for US we have ongoing engagements with them, they're going to be important for us in the future. So the point here is not to reduce or change or move rather than create incremental additional business, that's going to enable us to flourish across.
Our partners are.
The associated without does that address your question.
That's great. Thanks, Sean congrats on the quarter.
Well thank you.
The next question is from Steve Enders from Keybanc. Please go ahead.
Okay, great. Thanks for thanks for taking the question I wanted to ask a little bit more on just the hiring environment that youre seeing now.
Erin.
Oh, great resignation and people quite a bit and also a lot of movement.
The hiring market today, but just how are you finding the ability to bring in new talent and.
How competitive are a lot of these oh it is.
Today.
Yeah. Thank you for asking I mean, it's in the heart of what we're all trying to do it right at the end of the day, it's all about people.
Yeah. It is a bit more competitive than it wasn't the paas for sure, but so it turns a very exciting company I mean, we're definitely in a lot of different markets. Many of which are extremely appealing to folks all the way from powering TV at home to education to enterprise I think people love.
The breadth of what we do but also that it is not a back office type company that supports kind of technology in the hospice of the CIO, but something that touches and users and you can take pride in how this actually helps people around the world and people relate to that I think the culture of the company is a big draw. The fact that we're open and flexible collaborative and this is not just.
The amount of words, but actions our strategy goes and how we're perceived within our industry.
Being a public company is really helpful by way of portraying our potential to grow and accelerate both on innovation and our go to market, but also in providing new public company comps, which is exciting for the folks.
So it's a bit harder than it would've been a year or two or three ago, given the amount of companies that are hiring, but we see great excitement from folks who joined the company.
Okay, great good to hear and just a follow up on that on the nonrecurring piece and as we kind of think about that.
The impact on the model here I mean is it primarily coming on the services side are there.
A usage component that's coming in here.
That's beginning to roll off I guess, how should we just kind of think about the next.
Next there.
Pure services, when we referred to the nonrecurring we're referring to.
Lower margin work that is done and you're done.
So it's a bespoke developments in order to customize integrator builds specific solutions for specific customers.
And historically I mean, it's high in media and telecom, but it's been higher in <unk>.
And P ever since we launched new products last year, because we ran to customize them for a specific large customer that's.
Often the case in the cycle of new product and so when we came with our virtual event platform. We charge an awful lot initially on professional services because it just wasn't ready yet and so we kind of loaded at all the customers to customize it to what they need now we've created more automated capabilities that enable that within the product.
So we've pushed more revenue from nonrecurring to recurring and we've accelerated sales cycles and deployment cycles and improved gross margin in the process, but it does hurt our professional services revenue and it's a good thing we've seen a declining on the booking we've seen a declining on the revenue is coming down and it's actually a very good thing for the company.
Okay perfect. Thanks for taking the questions.
Thank you Steve.
The next question is from Ryan Koontz from Needham and company. Please go ahead.
Hi, Thanks for the question I wanted to ask maybe a little bit different way about the professional services aspect.
It sounds like the ramp there is a challenge with ramping new wins converting to revenue. So in addition to the transition to self service for the low end of the sector.
Do you have any other strategies, there to reduce that dependence or add hires or.
Make it just is there kind of any medium ground there in the professional services aspect too.
Customers onboard its faster than any color there would be helpful. Thank you.
Yeah. Thank you I mean, it's.
The work that we've been doing a class of product has always been geared towards accelerating sales cycles and deployment cycles, we have.
We've done that over the years.
As years go by it's just that when you have a new set of products.
You cannot come with a minimal viable product that has everything tailored, especially when the claim the same and what's very unique about our ability to offer enterprise grade capabilities with a lot of branding and integrations I mean, that's the powerful tomorrow, there's a bunch of vendors out there the cater to very small initiatives.
Project, which are not coming with a degree of enterprise ability. If you may as do we and so it's not necessarily an evil, it's something that goes well with our offering but we've been working hard last year. This year next year to find a middle ground and one in enabling all these integrations customizations one fits all.
All of the other hand, not to go too deep into creating all of this they were PFS, but enabling our customers to do so so it's an ongoing effort that has been going for years, we're not waiting for the self complete self serve and look at the percentages were 88% recurring revenue at the moment for the company. We expect it to continue to go and crossed the 90%. So we're not that heavy.
And when you look at E&P you'd note that E&P is much better than it has always been its MLP that takes it down so in both cases I think we're in a good place and continuing to improve.
Okay, Great and just a quick follow up on the education sector. We've seen a couple of the Ed Tech misses in the last couple of weeks with the reopening and so on.
I think it's more K through 12, but what kind of color can you share with us on kind of the impact of the reopening on.
On your education goals. Thank you.
You say misses in so far as lower software revenues and bookings are.
Yeah, Yeah, it's not like it's mostly yes.
And what sort of things.
Yes, so as you know first of all the majority of our business is not K 12, higher Ed, albeit that we are coming down to also address K 12.
And so we definitely have seen continued demand and interest on the education front, it's true that in the height of the pandemic a lot of folks who didn't have anything after running quickly get things done within a day or two and also that there were significant upsell by way of usage that might not necessarily continue into the future but.
We are a content management platform that means that it's not just the.
Right now type of a class that's happening, but the storage of all of your content and the management of all of your metadata and so that is a cumulative and so we still need to cater to that in universities and schools still use that with a higher volume because it needs to be carried into the future. The second is that I think we are in the second inning.
<unk> really for video because what happened very quickly in the pandemic was to offer a very quick solution for folks who joined remotely and to manage the content, but not truly be the first class citizen of teaching and learning with video if youre thinking if it's connected to your score scorecards or to your analytics.
It's still not 100% there. So the next move is to have an end to end solution that looks at teaching and learning first remotely than second and campus by the way not just for the.
The purpose of folks that are never coming to campus, but even if it's just flipping the classroom. So you could actually deliver the lecture is remotely and then come to classroom to do the actual homework.
I think that the best is still ahead of US and culture is best situated for it given the degree of integrations API connections into the LMS until the classroom software now our virtual classroom. So I'm very optimistic for the future for education, and we're not seeing more churn or a very significant softening in education.
Got it thanks Ron.
Thank you Ron.
The next question is from <unk> <unk> from Oppenheimer. Please go ahead.
Thanks for answering my questions have been answered, but I guess, Ron maybe you can talk about meetings.
What has been progress there.
Yeah. So when we launched real time conferencing, we said clearly that but we're not targeting kind of the regular meetings that a zoom or teams would be but what we like to call meetings with a purpose.
And this is exactly where we've advanced if you look at Gartner report Theres, an equal to that showing how we are growing year by year and scores and positioning where right after Microsoft zoom and and Cisco Webex and most of these reports in an area that we have not been in that they've been in for the last 10 plus years. It was very strong players but that isn't.
Races, where there is a combination of our content management system together with <unk>.
Our real time and this is where we're focused so we advanced in two ways. One is to harden our classic RTC capabilities by way of quality by way of scale and we are and also unit economic by way of efficiencies and we're putting a lot of smart people to get that done, but I think even more importantly is how do you harness that capability with them.
Virtual classroom within virtual events are not separated theres, a very significant convergence in the market and we are leading that convergence and the demand for these solutions is huge and we are ousting existing big vendors because of that very unique combination of content management in real time. So this is our focus and we're excited about it.
Got it I guess, maybe as a follow up if I'm paying that up what's your.
Sales ramp.
Our ability to kind of unleash the self serve model early next year as you've talked about it and it was a strong backlog that you have.
We anticipate 22 to be an acceleration year from a revenue growth standpoint.
Okay.
Yeah. Thanks for the question, obviously, we're not yet providing guidance for the year, we will definitely provide guidance. There is a lot of things that get thrown into the mix as we kind of put it altogether.
But I can say again that all the plans that we've had before so the plans that we have now we've spoken about self serve and we intend to continue to do that it was planned to be launched next year and it's still planned to be there I think there is very very strong engine behind the company and we're excited to next year, but we'll wait a bit what guidance you. Ron do you have any specific we're not seeing that.
Hope you are doing this call and what you've seen the numbers that we have continued to build the infrastructure for strong number going forward and at this point, we will try to continue to plan, but then hopefully we will be able to deliver.
Some.
Good numbers, when we we'd be ready to do it.
Very good good luck guys.
This concludes the question and answer session I would like to turn the conference back over to Ron <unk> for any closing remarks.
Yep. Thank you all for making time for your great questions and for those who are just listening and thank you for listening and hopefully everybody is safe and sound and continue to be healthy and thank you for your time and attention. It's been another great quarter across our markets fueled by continued strong productivity and retention rates and we're ramping up our resources across the board.
Especially in sales and marketing to fuel our future growth excited towards the future onward, and upward and everybody take care.
This concludes today's conference call you may disconnect. Your lines. Thank you for participating and have a pleasant day.
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Good morning, everyone and welcome to the couch or a third quarter 2021 earnings call for opening remarks, and instructions I will now turn the call over to Erika Mannion at Sapphire Investor Relations. Please go ahead.
Thank you and good morning, with me today from Couch or Iran. You could tell co founder Chairman and Chief Executive Officer, and Iran commodity Chief Financial Officer.
Ron will begin with a brief recap of calories mission and market opportunity and with a summary of the business results for the third quarter ended September 30th 2021.
Iran will then review the financial results for the third quarter, followed by the company's outlook for the fourth quarter and full year of 2021.
Then open the call for questions.
Please note that this call will include forward looking statements within the meaning of the federal securities laws, including but not limited to statements regarding Cal towards future financial results and management's expectations and plans for the business.
These statements are neither promises nor guarantees and involve arrests and uncertainties that may cause actual results to differ materially from those discussed here.
Important factors could cause actual results to differ from forward looking statements can be found in risk factors section of Cal tours quarterly report on Form 10-Q, but the period ended June 32021, and other periodic SEC filings, including the quarterly report on Form 10-Q the pier.
<unk> ended June 30th 2021 can be filed with the SEC.
Any forward looking statements made in this conference call, including responses to your questions are based on current expectations as of today and Cal Tora assumes no obligation to update or advise them, whether as a result of new developments or otherwise except as required by law.
All material contained in the webcast is the sole property and copyright of Cultura with all rights reserved. Please note. This presentation described a non-GAAP measure adjusted EBITDA, which is not prepared in accordance with you as well.
A reconciliation of this non-GAAP financial measure to the most directly comparable got metric. Please refer to our earnings release.
Now I'd like to turn the call over to Iraq.
Thank you Erica and thanks to everyone for joining us on the call. This morning.
We're excited to report quarterly earnings for the second time as a public company.
Start this morning, with just a few opening financial highlights from the third quarter.
Because some of you may still be due to the coke to a story I want to provide a brief recap of our mission and market opportunity.
After which I will provide more details on the bus and quarter.
We reported a strong third quarter revenue for the quarter was 43 million up 40% year over year and above the high end of our guidance of $42.5 million.
Subscription revenue for the quarter reached 37.7 million.
An increase of 40% from the prior year and represented approximately 88% of total revenue.
Our annualized recurring revenue.
True to 151.7 million.
41% year over year.
And they're a net dollar retention rate was 117% up from 111% one year ago.
We also continued improving our gross margin across both reported segments and achieve the gross margin of 65% in the quarter.
Our adjusted EBITDA was negative 2.3 million also ahead of the high end of our guidance.
Oh, if we looked at the future of customer experiences work learning an entertainment in a world reshaped by the pandemic.
Video technology and video experience it continue to emerge as a primary facilitator for change.
Did you have technology now serves as the foundation for we both work remote learning virtual events and online entertainment replace the travel in person meetings office space classroom event venues are much more.
Enabling everyone to participate from everywhere.
Oh tourists mission is to power any way to experience for any organization or.
Video experienced cloud drives communication collaboration learning virtual events and entertainment experiences.
Millions of people at work at home and at school.
We cater to date two four main markets.
Enterprises from all major industries, including more than 25% of the U S Fortune 100.
To whom we deliver our video portal town home video messaging Webinars and virtual events.
Internal communication and learning as well as digital marketing and customer experiences.
Education institutions, including more than 50% of the top U S research educational institutions.
Seven of the eight Ivy League schools.
To whom we deliver video solutions for in class and remote teaching or learning, including video extension for learning management system.
Electric capture solution and a virtual classroom solution.
Technology companies to whom we provider immediate services, which are broad set of on demand live in realtime video a P. I is an experienced components.
That enabled them to launch new video products or add rich video workflows to their existing products.
And lastly, immediate telecom company for.
For which we provide streaming media cloud to be solutions.
For both subscription base, an AD supported services.
We still are solutions, primarily through direct sales teams that account teams that are also organized based on these for customer markets.
And report based on two seconds.
E N T segment, which combines the first three markets.
And do you have a piece segments, which represents a laugh market.
Often involves longer sales in deployment cycles.
In recent years, we've been accelerating our revenue growth rates.
But I'm also improved our adjusted EBITDA without material increasing ourselves in marketing.
We achieved this through an increase in self sufficiency.
By our growing product portfolio and by heavier adoption of video experiences across their market.
In recent months, we started expanding ourselves forced and expect it to continue to fuel their future growth.
Along with the planned increase in a marketing Ben.
Our growth is also supported by the increased adoption of our most recent product releases, including virtual events Webinars and virtual classroom and is expected to also be boosted by your plan moved down market to power smaller organization with low touch and self serve products.
Coupled with an associate it expected increase in sales for channel partners.
We are pursuing an inspiring and timely mission.
Believe we have unique sustainable advantages.
And are very excited for the future.
Now returning to the third quarter of 2021.
I'm Gonna go to market perspective, and starting with R. E M T segment.
In the third quarter, we continued to see an increase in the average are all per customer.
And then the average size of new deal.
We also continued with our global expansion with a greater portion of your bookings coming from EMEA in APAC compared to last quarter and last year.
Oh, North America remains the largest market.
We saw continued growth and the percentage of new business that it's coming from channels.
Well if continued reduction in the proportion of book you professional services versus subscriptions.
As R. U E N T offerings continue to mature and requires shorter deployment cycle.
We secure new customers, including Fortune 500 companies and universities the purchased a wide array of of products, including are you a product and solution edition of Webinars virtual classroom and virtual events.
Pertaining towards your offerings.
Gardner issued their 2021 magic watching for meeting solutions and the 2021 critical capabilities for meeting solution Companion report.
Which included filter out for the second time since we launched a realtime conferencing offering last year.
We were excited to be recognized as a visionary and the magic quadrant.
To be ranked fourth in the critical capabilities report and the external presentation use case and fifth and the Webinars as well as the training and learn to use cases.
So try it has a unique approach to meeting solution market.
We address the complexities of meetings that go beyond the standard video call, which we referred to as meetings with purpose such a virtual events webinars in virtual classrooms.
You think are powerful tools for content management and integration with enterprise workloads based on our underlying market, leading video content management platform.
Tara was previously named a leader in the guard to a magic quadrant for Enterprise video content management Research reports since 2013 for five consecutive times and ranked highest and all use cases and the last published critical capabilities for enterprise video content management report.
Carter just continued the publication of these reports by 2019.
Pardon strengthen addressing meetings with purpose helped us secure your customers and expand their business with existing customers of the third quarter, such as one of the largest global accounting firms in the world. The replace its existing Felicia would go through the power that we both employee training of development all across the globe.
We also find up new universities of the U S and worldwide.
Solve to address their media called to management and virtual classroom needs with a single platform.
R virtual event platform to build on our blog video technology stack, combining lie save you live real time and on demand video enabled us to successfully power complex virtual events and become a leading central virtual events platform for enterprises for all of their events large and.
Paul.
We're continuing to onboard new customers and upset the existing one and it's very exciting market.
While on the topic of virtual event.
We are thrilled about our upcoming virtually live event on November night, where we will host a tremendous light up a marketing executives from.
From Microsoft S. A P Oracle Youtube Accenture Docusign drift hubspot, NASDAQ at lesion and many more.
The spiritual event will talk about the future of marketing a virtual event.
And also a showcase the latest and greatest of guilt towards virtual about platform.
Be sure to register and attend virtually live until also read our state a virtual events 20, twenty-two report, which we're releasing tomorrow covering user and by your preferences in this market based on feedback for more than 1200 responses to a survey we put up.
Continuing with the E N T.
Oracle analysis in the third quarter that they are expanding the strategic agreement that they had signed with us in 2019.
Video capabilities into their products using our immediate services.
Just original OEM agreement with Oracle included only our video content management capability and.
And the extended agreement covers all of our capabilities, including live stimuli and realtime video experiences.
First of all it's been a customer of Kultura since 2012, using our video portal and town halls for internal employee engagement as well as external customer education.
Part of the partnership expansion with Oracle, we've also undertaken to host all of Oracle related workloads on the Oracle cloud infrastructure.
This will enable oracle salespeople to tell coke products and solutions hosted a nautical clouds.
We're extremely excited about the huge potential of this partnership.
We also plan to continue growing our strong partnership with a W. S.
Our cloud provider and go to market pardon.
Been pouring all of our south customers. For example, we part virtual events for a leading a damn platform as well as the Fortune 500, consumer electronics company wanting unable to U S.
In regards to I'll go to market efforts in the <unk> piece segments.
We're continuing our ship for mainly targeting larger telcos to also targeting smaller telcos broadcasters and media companies would direct to consumer offerings.
The majority of our new business in the third quarter came from these markets. It is a healthy shifts because it increases are addressable market shortens our sales in deployment cycles and companions, reducing the amount of required professional services.
Also the third quarters your bookings come in from all regions, including a bigger part than usual from Latin America.
M S T. It's still tracking to lead our segment in 2022 in terms of percentage of growth of your bookings compared to 2020.
Because of the length mirror deployment cycles in some cases.
On a revenue will not be recognized until late 2022.
Sure both E N T N M N T. We continued building up our sales force in the third quarter, including you sales reps customer success managers and sales support staff.
We are slightly behind her eternal hiring plan.
Back to catch up in the coming quarters.
Are forecasted average productivity per salesperson for the year remains would be anticipated levels, which is great considering our growing salesforce.
From a technology development perspective.
We are continuing to wrap up developers in order to accelerate our product roadmap.
Five primary activities in the past quarter and your future are as follows.
One two.
Larger comprehensive second generation virtual events platform that includes a user friendly orchestration and management layer for marketers too easily stepped up and manager events.
This platform is well suited for all marketers, who nowadays need to execute and a large number of virtual and hybrid events of all sizes.
This platform is designed to shorts ourselves in deployment cycles and reduced required professional services in an effort to help increase gross margin.
True.
To continue advancing are recently added realtime conferencing engine to best support our fast growing meetings and event products in an effort to preview the costs and gross margins.
Right.
She continued development towards lodging ourself serve media services Webinars in virtual classroom offerings in the first half of next year.
Move is expected to increase their target market to include small and medium enterprises smaller schools and start ups and also to reduce required professional services again in an effort to increase gross margins.
Or.
To enable our services and products to run an O C. I have discussed previously.
And lastly, five.
For the M T sector to continue working on a more simplified and twin version of are offering for media companies and smaller telcos.
It would enable us to launch services quicker and without the need to procure separately individual tech stock components.
This is expected to broaden our target market and reduce required professional services again in an effort to increase gross margins.
Our product investment areas are lined with important market trends related to the adoption of video technology across all of our products that use cases.
And we're excited about our upcoming launches and continued market disruption.
In summary.
We had a great quarter with strong growth retention rates and gross margins and we're already hard at work on the next quarter.
We're continuing to increase our sales and marketing spend it to wrap up additional sales staff.
We continued to be excited about the strong traction that we're seeing for a recent new product and solution releases.
And are excited to launch important enhancements. In addition to these offerings, including lower touch and software products that we expect will open up their target market to include also smaller gonna nations.
Which we could sell a deploy faster with less services and a higher gross margins.
With that I'll turn it over to your roller R. C F O to discuss our financial results in more detail.
They're wrong.
Thank you Ron and good morning to everyone.
Cause they review all set quota results today. Please note that they would do is send to a normal got matrix adjusted EBITDA.
Hello consideration of golf and non-government nonsense is included in today and go news, which is available on our website.
Sometimes I venue for the third quarter.
September 30th 2021 was 43 medium up 40% is overdue.
<unk> Avenue was 37.7 million up 40% you whether you like the first one of the services.
Revenue contributed tycoons, who need them up so too sweet person, yeah, a little bit.
Yeah.
They removed performance obligation, what where one of US is 62 point to me don't up 24% evil. There you will switch we expect to recognize 59% as revenue over the next 12 months.
Revenue was when I was in 51.7 million up 41, 41% yield are ya.
Revenue benefited so my local continued use of your grocery and they don't know attention right, which was one of those and 17% in the first quarter compared with one of the 11%.
Sweet 2020.
T V E. Two segments, what kind of everything was supposed to console me doing up 45%. We overview subscription revenue was 28 million, absolutely and 1% either where are Ya well professional those services revenue contributed 2.5 million up 99% yoga are ya.
We've been able to segment totaled lived in you'll was 12.6 median uplifting one you'll over your subscription revenue was nine seven medium upset the 7%.
Q when professional services revenue contributed to please no meat on up since two per cent you already have.
Gross both within the quota was what 27.8 medium representing the glucose monitoring of 625% absolutely, 59% gross margin <unk> 2020.
We've been eating too segment gross supposed it was 22.2 million representing a gross margin or 17, 73% up some 72% gross margin kill sweet 20th when.
We've been M. M. Two segment gross profit was 5.7 medium representing the gross margin.
45%, absolutely, 32% gross margin and two sweet 2022.
Oh, and the expenses was $12.4 million, 29% of revenue compared to 24% <unk> 2020.
Google has premium by addition on its own and pay on it's expensive as we continue to invest in technology and innovation.
Says and marketing expenses, well 11 point see me doing all 26 of revenue compared to 22% and <unk> 2022.
Zooming by insurance as an occupant investment.
Clothing, and capetown and and so then related expenses, we intend to continue to invest in seven mile keeping cause we extend that what it says it says since falls and marketing careful.
<unk> leather gel position in the market and capture significant opportunity installed the five.
G&A expenses was 10.1 medium.
Oh, 23% of revenue compared to 28% and <unk> 2020.
He plays was June 8th he knows <expletive> dog, one time expense related to abandon hope that the center of equipment and kill sleep 2022.
All sorts I I feel that it is expensive.
And in case, the Namco and it is in stock based compensation expenses Dr.
Dot net mostly in the quota was 25.2 million 4.26.
They noted show adjusted EBITDA was a negative 2.3 million be crazy for 1.7 rebuilding feel free 2020.
This resolved in line with our plan to include that was sending you know that the service road rules.
Discuss that with you.
They're going to have a balance sheet and cash flow.
We ended move it.
The quota we've won 179.7 million in cash and chose name investment.
But eliminate that proceeds from our mission July that'd be closer and you can go for approximately 160 pounds for me doing it gets using the email parades and that's even if he was 5.7 medium and the call too.
I would like now to them to our outlook for the fourth quarter and the full meals 2021 for the phone call that we expect revenue to be 41.2 million, who 43 phone to me doing which isn't that we've been negative adjusted EBITDA was 7.5 million to nine point size medium.
For the for me, we expect revenue will Swan is within the system.
Five two 165 coincides with a negative adjusted 14.1 medium.
One medium.
These are both optional mile with previous guidance in summary, we believe.
Doc slumped lifeline Enervated medulla retention rate.
And it says that must be really soldiers. We remember lost to continue to support a robust which I was living in new growth go sleep and that will include some housing in.
Nine movie choosing a really long time goes.
With that we will open the cultural questions operate though.
Thank you we will now begin the question and answer session. Vagina question can you May Crestar then one on your telephone keypad.
Hear a tone acknowledging your request please limit yourself to one question and one follow up.
If you're using a speaker phone please pick up your handset before pressing any keys to West Gyr question. Please press Star then too.
Little cost for a moment his college trying to cure.
The first question is from country you cannot from Bank of America. Please go ahead.
Hey, Thanks, guys for taking my questions great great quarter.
I wanted to ask you a question about 2022 for a bit here you know we're at the end of 2021 and specifically about your E. N T segment, the enterprise education and technology and maybe you could you talk about which one of those three you're most excited about as a growth factor heading into 2022.
Oh, you're not Gonna do you think it's so much and thank you all for joining and by the way once like correction that I've noticed after that I misrepresented I said that M. N. T continues to leave their segment in 2022 in terms of percentage of growth virtually twenty-twenty. Obviously, it's 2021. So that's one small fixed for your question.
'bout, 20th 22, and what we're excited about you know across all of 40 areas were very excited because they have all been growing very nicely. If there was a lot of demand. We've already mentioned that M. N. T is on its way to grow in the highest percentages here. So we're gonna enjoy growth both at the end of next year on the following one there's some delay on this so.
So far as market demand within the E. M. T sector I'd say all three are very strong that dollar retention is generally led by tech OEM, followed by enterprise, but I'd say that the most explosive one by way of overall market size opportunity is the enterprise Subsector within E. N T. It is the largest one.
They were booking right now it's the largest one by way of revenue within E. N D and it is one that with all the new products. So we've started launching and the great demand that we see for them, we expect significant growth and and to remind you. We're also gonna go down market towards the S. M E market with more self serve products were virtual events and learning and so.
Expect that to continue to push so I'd say, they're all exciting from a sigh and overall potential I'd say enterprise would be does that answer your question Covid.
That's perfect. Thank you and just one follow up here, if I may I wanted to double click on the on the hiring plan. You you stated that your slightly behind and I wanted to dig in a bit more on that could you quantify or maybe talk about qualitatively about your current sales capacity and how we should be thinking about any sort of catch up there in sale.
<unk> and the ramp from here heading into 2022. Thank you.
Yeah, I'm happy to do that so you know we don't report specific numbers around self four sides and ramp but I can say that we've been going our team very very nicely and E. N T. R. Ram salespeople and customers success managers grew by 50 per cent in quarter, three compared a quarter. One so did you huge jumped.
And an M N T. The combination of sales and see it then grew by 20 per cent in quarter, three compared to quite a quarter. One. So it's a significant growth that was planned when we say that were slightly behind it is kind of a single digit type of a lag we expect that to be cover it over the next few quarters with a lot more growth that we're putting in place and it's important to remind everybody.
We anticipated that towards the end of the year, we're gonna need to pass the baton from growth because of increased efficiency that we've seen over the years growth also because of more salespeople that Ah rent and that's something we're starting to see now by way of bookings were gonna stay in queue for and definitely entering 20 twenty-two uhm so that reacceleration.
And if you made is is ahead of us and we're seeing early signs and we're excited about Iran. You want to add anything or yeah.
First of all it's more mentioned the most important point that the increasing that was set in school since the beginning of the really significant it's like a as he mentioned these between 30% to 50% of the Senate suppose.
And we believe that by adding the people that we are living in catching up.
Thank you for and getting to Q1, we've lived the right amount of sleep in two supposed to grow for next year and the <unk> as well and also mentioned, we see that it productivity liberally still remain a.
At a very young so we definitely don't see a erosion in productivity so by adding the people and we believe that we would see a very nice day inquiries going into next bill.
Got it thank you for calling thanks for taking my questions. Thank you.
The next question is from D. J Hines from Kenacort. Please go ahead.
Hey, Ron here on I'm going to need a 40 per cent growth across the board congrats.
I I want to ask about the bookings environment and execution in the corner I mean, the the qualitative commentary, obviously sounded pretty upbeat if I look at the amount of net new a R. R. You added and a quarter.
You know it it's the lowest we've seen in more than a year. So can you just double click on on what you saw in the quarter. I mean is it the last couple of quarters benefited from some of those chunky kind of empty deals draw.
Dropping in or maybe just talking about.
Close right, then and what the pipeline looked like I ate in the queue for.
Yeah, I agree to do that would be J. So.
More colors, so segments Y a contribution for all segments.
The largest contributor as I mentioned earlier continues to be enterprise.
Roddick perspective, the large majority of the U T deals are meetings related so the include live and or realtime conferencing.
I'll say that from a concentration perspective in the Bath, we'd add much more push and both booking and revenue coming from a single fuel very large customers. That's not the case now concentration you've seen that in our comments are coming down you'll see that in the thank you as well Vodafone year to date is under 10% versus last year that was at 12% Amazon.
Came down to single digits top 10 customers are sliding down from cute too that's good from an RP perspective.
B E N P new deal or boot boot to the highest level this year.
So we're seeing this mainly driven by the new products virtual events in virtual classroom for large companies are bigger ticket item. So we're seeing bigger and bigger deals come in we already mentioned from how we closed the deal insofar as productivity. They have been as forecasted for 2021 to continue to be strong.
To continue to be as planned we don't report up to be the cat, but I could tell you that it's still very strong. We did tell you that we've grown ourselves forced and the numbers that we've said, it's just a question of catching up a bit sauce slightly more and then it could give you examples in in in in new logos and enterprise.
We get a lot of meetings related stories, just a couple of now I'm eating examples we had two fortune 500 companies when a very large retail company as the other very like Chipping in business service companies.
Kim took out your to manage all of their externally facing videos on their website to support marketing and E Commerce workflows.
And you are seeing folks purchasing solutions that are combined between content management together with the new virtual classroom and also integrated with things like Microsoft teams zoom.
And media, we stuff, we saw more media companies like the biggest kids channel and European country launching would go through you athletes direct to consumer offering and a bunch of ourselves the virtual event side.
One of the largest chip manufacturers just conducted their second virtual event with tens of thousands of folks one of our biggest customers that I've been using us extensively at the added a bunch more events smaller ones with our platform that supports both large and small I mentioned earlier, a very big accounting firms that joined us and they've replacement.
Existing better for learning development, there's a lot of great. We did mentioned Oracle for the second we them expansion. There's a lot. So I think it's a good quarter very rich very well diversified I wouldn't take too strongly on some shifts between this quarter and the other by way of bookings. That's why we don't report on it it catches up.
Two four is generally a very very strong quarter Q2 was also strong because of one Meg a large deal and <unk>, sometimes they take awhile and they come a bit. After so these are some of my thoughts you want you want to add anything yeah. In a you ask about the fact that via U U C. A slow grill seem day are off with the school. So we can get we are focusing.
From the beginning of deal we were focusing.
A the grilled slowed down for the second.
Yeah, we'd be some slow down and this is because of the fact that we have a we have maximize the effect of improving the central put the Pvp and now we mainly a day at 10, a wrong, which we discuss it from day one is coming from the fact that we are adding more and more people and we will see the impact going into Q4 booking.
In the beginning of next Bill and there's all mention keeping kind of cute boys are very started walking and we've been you'll says people that we are ending.
Believe that into equate it very interesting to fake going forward.
Same time, we are not to be floating with a specific deal, but we are negotiating some a big deal that hopefully would you be able to close.
So to make it also it should we got we guided these kind of slow down the day or I'll go from day one almost.
We are taking bold actions you know those <unk>, we accelerated again was always from the pain and we see that he's going to likely.
Yeah, Okay very helpful color, what one follow up Ron I'd Love to get your your thoughts on kind of the efforts to drive more self serve buying I mean, just maybe you can talk about what you're doing to make that happen right. You talk about some of the products that makes sense, but how do you layer that into the go to market motion right I I feel like we often see folks layer.
Direct sales the efforts on top of self serve but it's less common to see it go the other way so I'd I'd love to get some color there.
Yeah. So we've been we've been talking about this for awhile working on our software solutions that are expected to launch in the first half of next year their Bookstaff and pass solutions, both solutions for internal use for learning development and external for Webinars virtual event fedorov as well as the platforms of surface.
For developers.
The main work we need to do is adding the right internal workflows that are tying all the way from marketing of registration and some self support itself care and stuff like that were hard to work and that we expect out to lunch. We're not gonna go all the way down to S. M. B, we definitely not targeted consumers on its expect it to be <unk>.
I mean, the world immediately come to an immediate does media companies and all the developers will be start up but we expect that to be a material change for what we're doing.
You know we feel very confident about this move but you know one of the things that we started doing more this quarter, we're going to do a lot more than that next quarter does not working on more spend on marketing and you're gonna see the whole funnel all the way from the top of the funnel on digital campaigns that are promoting our Brandon promoting our solutions. We brought people that are experts on this from other.
These were putting funding towards this even a bit in advance of the actual launch of these products and we feel that we are gonna be well equipped to do that yeah and it to be clear part of it is also making departmental sales for the larger organizations that were working with any way as opposed to coming as a unified Dale So I'm, a CIO perspective would full F D.
Coverage and definitely we have a strong uhm for suit on that site address your question.
Totally makes sense and and again very helpful. Thank you guys.
Okay. Thank you D J.
The next question is from Michael Taryn from Wells Fargo. Please go ahead.
Hey, guys. This is Austin lines off for Michael Thanks for taking my question. So it looks like they're revenue growth in the quarter groups, 3% sequentially, but the guide implies down roughly about 3% sequentially at the mid point, despite it being a four Q. So one of the drivers that sequential stuff down is there any color you can give them almost.
Between subscription and professional services.
Yeah. It's it's a good question. Thank you spoke to asking you, yes, we say needs to be fully in the previous calls and we are saying it again.
Because of the fact that we had a significant notably coming revenue.
In previous Cortes related to this day that day.
Some of the big Bill to other events in there where we.
Adult of significant spelled normally telling living you, it's not going to happen this quarter, we save it.
Before is so this is one of the reason for the decrease.
Hopefully we would work out to beat this number but I only be elaborated on the fact that the.
We are anything more sleep and so we.
The impact on becoming quote there's definitely going to change from D. C. They lecture.
Other than that.
And I don't think that they have anything to it.
But the.
There is also some big deal that we are negotiating right now that also can contribute for the future growth.
So to make it all story the main point. These obviously didn't normally tongue rubbing. It was it was very significant and it's not going to be this quarter.
And when we're looking to make the only recurring revenue. The fact that we are adding to beep and the fact that we're going to beat the numbers and some of the big things that we have.
We believe that the acceleration of the growth will continue into the future yeah.
Yeah, we'll just added thanks for the good question that you know other than the fact that we've been saying that since the beginning of the year because we knew the non-recurring fees for Q4 does not gonna come back and the fact that there is a certain expected slowed down that's gonna be catapulted myself people is.
What we've guided for Q4 revenue numbers is equal to what we've done kind of before so we're maintaining kind of the theme that mid range. If you kind of run the annual expectations that we put earlier and you've gotta run what two four would have meant.
That hasn't changed we're maintaining queue for we just increased the range a bit to allow for swings up and down.
But otherwise we haven't changed them for the full year.
We increase the full range by a million dollars. So we basically up the full range and for the year and maintain two four and let's see where it takes us we always want to be cautious.
Okay. That's helpful color and then just as a follow up the it looks like the garage gross margin improved pretty nicely over the prior quarter and the prior year I just wanted to unpack that a little bit was was usage an impact here driving me improvement or whether any other major drivers to call out and any other segment.
No no the main driver their main driver.
We told everybody before we are going to focus heavily and improving day Tuesday, especially post COVID-19.
So I don't think it's related so much with the marketing Bucks, but.
Some of the actions that we are.
Taking and you can see that by the way and Big enterprises location and think we we.
We we made some mileage.
In the way of improving the numbers, but we are still not where we want to be a which is the number of pre Kobe. So do we still have room for improvement.
A side effect between for the <unk> the BNP from 70, 273% the big change was the media and political what we always say that there is a lot of film doubtful improvement, we improve it from 42% to 45% and when you look for <unk> compared to the court their last theory from 52%.
45%.
And by taking some of the other rich and including the reduction of besides those they normally come in revenue would you believe that we would Steve is there room to grow. So most of the actions are related to what we did in the company to improve and to continue to improve notably we are not call me think that's right now we will continue to be.
<unk> for the show them, a again to 65% because obviously when we discussed before it was the icc's low sixties and now we had 65% off that we had 60 doing last quarter, but.
But we are definitely going to see it continue improve above below 60 is going into the rest of deal and especially for next year.
And and we will provide more detailed guidance when we would get too.
The beginning of next year.
I'll just add that you know one of the good things that were saying and we've been targeting and we're building our product for that is the continued reduction of the percentage of professional services. So a reduction of nonrecurring. It's both a medium telecom and an enterprise education in tech.
And the other one is the growth and usage based pricing that's coming together with the new products and also a ship the postman W, which is great and obviously in general are growing scale introduces Laura I S pricing and then predict economy of scale. So we're definitely expect it to continue to go towards a long term goals with the parentheses as you were on it said what do we do expect.
To see some jumps and fluctuations in gross margin the shirt in the short term so would not necessarily expect to see better gross margins that could come out, but that's knocked down again. Thank you for before it continues to go up for very optimistic and working hard towards improving Martin.
Great. Thanks for the color guard.
Oh, thank you.
The next question is from that nickname from Deutsche Bank. Please go ahead.
Hey, guys. Thank you for taking the questions one on bookings from channel I I'm, just curious I guess, where you are today what percent of new business is actually coming from sort of Nondirect salesman, where you envision this going over time with somebody expanded efforts both in channel and some new herself so prada.
And then maybe it is a follow up to the gross margin question. How do you think about migrating more workflows beyond Oracle specific ones onto the Oracle cloud or other baby public cloud partners beyond AWS, and then you know would that be sort of a meaningful tail.
Tailwind for gross margins overtime.
<unk>.
Yeah. Thank you.
But first thing Ah so far as per cent of business coming from channel.
No. It's it's continue to go up E. N T is actually at the highest reset level that we were it went beyond 10% typically it's on a midden single digit so that's going well M. N. T is not really a channel business in most cases, sometimes we do have some channel business coming in so I would focus on the N T. There. So channel is building up you know the biggest jump.
Is gonna be when we launch ourself their products and that's next year and we expect that we'll be able to push more things easily through the channel partner. So we have so we're optimistic and it's growing in the right direction. So far as your question about the Oracle and maybe a large we're excited about the relationship I've mentioned, they're they're.
They're very valued customer since 2012, we announced the ODM agreement with them in 2019, we've now announced the next step of that which enables both of the live in the real time, which enables to push it into more products and there are a lot of big plans. So that's exciting yes, we are putting stuff running on those the eye to support that that we are enabling oracle salespeople.
<unk> products to Oracle customers, that's not in order to improve gross margin and it's not in order to migrate them from a W. S. We continue to be a very very good partner today W. S. There are important for us we have ongoing engagements with them, they're gonna be important for us in the future. So the point here is not.
To reduce or change or move rather than create incremental additional business, that's going to enable us to flourish across all our partners that are associated with that does that address your question.
That's great. Thanks wrong, congrats on the corner.
Well thank you.
The next question is from <unk> from Keybanc. Please go ahead.
Okay, great. Thanks for thanks for taking the question I'm Gonna ask a little bit more I'm, just hiring environment that you're you're saying that I think.
Erin.
But a bad.
Oh, great resignation and people quitting and also a lot of movement and in the hiring market today, but just how are you finding the ability to bring in new talent and how competitive are a lot of these oddities engagements today.
Yeah. Thank you for asking I mean, it's in the heart about where I'll try to do it right at the end of the day, it's all about people and yeah. It is a bit more competitive than it wasn't the past for sure but so it turns a very exciting company I mean, we're definitely in a lot of different markets. Many of which are extremely appealing to folks all the way from pottery T V at home.
So education to enterprise I think people love deep.
The threat of what we do but also but it's not a back office eat that company that supports kind of technology in the hospital CIO, but something that touches and users and you could take pride in how this actually helps people around the world and people relate to that I think the culture of the company is a big draw. The fact that we're open flexible collaborative and this is not just him.
Matter of words, but action all our strategy goes and how we're perceived within our industry.
Being a public companies really helpful by way of portraying our potential to grow and accelerate bolt on innovation and I go to market, but also in providing your public company call, which is exciting for the folks. So yeah, it's a bit harder than it that would've been a year or two or three ago, given the amount of companies that are hiring, but we see great excitement from <unk>.
Two joined the company.
Okay, Great Great day here in just a follow up on the on the non-recurring pay as soon as we got to think about that.
The impact of the model here I mean, it was primarily coming on the services side are there you know usage component that that's come in and yeah.
That that that's beginning to roll up I guess I should we just kind of think about the the next the next there.
Pure services, when we referred to the non recurring we're referring to lower margin work that is done and you're done. So it's b spoke development in order to customize integrator build specific solutions for specific customer.
And Unfortunately, I mean, it's high and medium telecom, but it's been higher N E N P ever since we launched your and your products last year, because we ran to customize them for specific large customer that's often the case in the cycle of new products and so when we came with our virtual event platform. We charge an awful lot initially unprofessional services, because it just wasn't ready yet and.
So we kind of loaded at all the customers to customize it what do you need now we've created more automated capabilities that enables out within the product. So we've pushed more revenue from non-recurring to recurring we've accelerated sales cycles in deployment cycles and improve gross margin in the process, but it does hurt our professional services revenue and it's a good thing.
We've seen a declining on the booking we've seen a declining of the revenue is coming down and it's actually a very good thing for the company.
I had perfect. Thanks for thanks for taking my question.
Thank you <unk>.
The next question is from <unk> from Needham and company. Please go ahead.
I think I have a question I wanted to ask maybe a little bit different way about the professional services aspect.
Sounds like the ramp there is a is a challenge of ramping new wins and converting revenue. So in addition to the transition to self service for the low end of the sector do you have any other strategies there to reduce that dependence or add hires or you know.
Make it just as they're kind of any medium ground, there and the professional services aspect to get customers onboarded faster than any color there'll be helpful. Thank you.
Yeah. Thank you I mean, it's the the work that we've been doing a class of product has always been geared towards accelerating cell cycle and deployment cycles and we've done that over the years.
Years go by it's just that when you have a new set of products.
You cannot come with a minimum of a viable product that has everything tailored, especially when the claim to fame and what's very unique about our ability is to offer enterprise great capabilities with a lot of branding and <unk> and integrations I mean, that's the powerful through there was a bunch of vendors out there with the kid or two very small initiatives.
Project, which are not coming with a degree of enterprise ability a few minutes. So we just and so it's not necessarily an evil, it's something that goes well with are offering but we've been working hard last year. This year next year to find that middle ground and one in enabling all these integrations customizations one platform fits all.
All of the other hand, not to go too deep into creating all this but with P S, but enabling our customers to do so so it's an ongoing effort that has been going for years, where we're not waiting for the self complete self serve and look at the percentage of work 88 per cent recurring revenue at the moment for the company. We expect it to continue to go and crossed the 90%. So we're not that heavy.
When you look at E N T.
Note that E N P as much better and it all has always been it's empty that takes it down some bookcases I think we're in a good place and continuing to improve.
Okay, Great and just a quick follow up on the education sector. We've seen a couple of a tech misses in the last couple of weeks with the reopening and it sounds like it's more K through 12, but what kind of color can you share with us on kind of the impact of the reopening on on your education goals. Thank you.
You say Mrs. In so far as lower software revenues and bookings or.
Yeah, Yeah suddenly was mostly yeah. He's at all then.
Sort of things.
Yeah. So I was you know first of all the majority of our business is not K 12, and higher Ed, albeit that we are coming down to also address K 12.
And so we definitely have been continued demand and interest on the education front, it's true that in the height of the pandemic a lot of folks it didn't have anything after running quickly get things done within a day or two and also that there were a significant upheld by way of usage that might not necessarily convenient to the future but a.
We are a content management platform that means that it's not just the right now type of a class that's happening, but the storage of all of your content and the management of all of your metadata and so that is a cumulative and so we still need to cater to that in universities and schools still use that with a higher volume because.
It needs to be carried into the future. The second is that I think we are in the second inning of of ethic really for video because what happened very quickly and the pandemic was law for a very quick solution for folks who joined remotely and to manage the content, but not truly be the first class citizen of teaching and learning with video if you're thinking if it's connected to your score.
Four cards or to your analytic.
It's still not 100% there. So the next move is to have an end to end solution that looked at teaching and learning first remotely then second and countless by the way not just for.
The purpose of folks that are never coming to campus, but even if it's just flipping the classroom. So you could actually deliver the lectures remotely and then come to class room to do the actual homework I think that the best is still ahead of us and <unk>. That's a two headed for it given the degree of integrations a P i's connections into the LMS until the classroom software.
R virtual classroom, so I'm I'm very optimistic for the future for education, and we're not seeing more churn or a very significant softening in education.
Got it thanks a lot.
Thank you Ron.
The next question is from a tiny kitchen from Oppenheimer. Please go ahead.
Thanks for answering my question being answered, but I guess, Ron maybe you can talk about meetings and what is being progress there.
Yeah. So when we launched realtime conferencing, we said clearly that the that we're not targeting kind of the regular meetings that is zoom or a teams would be but what we like to call meetings with a purpose.
And this is exactly where we've advanced if you look at Gartner report doesn't go to that showing how we've grown year by year and scores and positioning wear white after Microsoft zoom, and and Cisco Webex and most of these reports in an area that we had not been in have you been in for the last 10 plus years is very strong players, but that is in <unk>.
Aces, where there's a combination of our content management system together with a a real time and this is where we're focused so we've advanced in two ways. One is to harden our classic IPC capabilities by way of quality by way of scale and we are and also unit economic by way of deficiencies and we're putting a lot of smart people to.
Get that done, but I think even more importantly is how old are you harnessed that capability within virtual classroom within virtual events are not separated there is a very significant convergence in the market and we're leaving that convergence and the demand for these solutions is huge and we are ousting existing big vendors because of that very unique combination.
Content management in real time. So this is our focus and we're excited about it.
Got it I guess, maybe it is a follow up and if I'm paying that up what's your.
Sales shrimp with your ability to kinda unleashed yourself served bottle early next year as you've talked about it and it was a strong back like that you have should we anticipate 22 to be an acceleration ear from a revenue in the air outgrow standpoint.
Yeah. Thanks for the question, obviously, we're not yet providing guidance for the year, we will definitely provide guidance. There's a lot of things that get thrown into the mix as we kind of put it altogether.
But I could say again that all the plants that we've had before so the plants that we have now we've spoken about self serve and we intend to continue to do that it was planned to be launched next year and it's still plan to be there I think there is very very strong and just behind the company and we're excited to next year, but will wait a bit guidance on your own you have any specific where no I hate it.
What people are doing this call and what you've seen the numbers that will continue to build the infrastructure for strong number going forward and at this point, we will try to continue to claim but and hopefully we'll be able to deliver.
A.
Good numbers, when we we'd be ready to do it.
Very good good luck guys.
This concludes the question and answer session I would like to turn the conference back over to Iran. You could channel for any kind of thing.
Yep. Thank you all for making time for your great questions and for those who were just listening and thank you for listening and hopefully everybody is safe and sound and continue to be healthy and thank you for your time and attention. It's been another great quarter across our markets fuelled by continued strong productivity and retention rates and we're ramping up our resources across the board.
Especially in sales and marketing to fuel our future growth excited towards a future onward and upward everybody take care.
This concludes today's conference call you may disconnect. Your lines. Thank you for participating and have a pleasant day.