Q4 2024 Kinaxis Inc Earnings Call
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[music].
Sure.
Speaker Change: Good morning, and welcome to the <unk> incorporated fiscal 2020 for fourth quarter results Conference call. Currently all participants are in listen only mode.
Following the presentation.
Speaker Change: And that concludes today's session instructions will be provided at that time for you to queue up for questions I'd like to remind everyone that this call is being recorded today.
Speaker Change: February 27, China, <unk> I don't know.
Rick Wadsworth: I'll turn the call over to Rick Wadsworth, Vice President Investor Relations at <unk> incorporated. Please go ahead Mr Lynch.
Lynch: Thanks, operator, good morning, and welcome to the <unk> earnings call.
Lynch: Today, we will be discussing our fourth quarter and year end results, which we issued after close of markets yesterday with.
Lynch: With me on the call are Bob Courteau interim CEO, and chair and Wayne Fitzgerald, Our Chief Financial Officer.
Lynch: The information discussed in this call is based on information as of today February 27, 2025 and contains forward looking statements that involve risks and uncertainties actual results may differ materially from those set forth in such statements.
Lynch: For a discussion of these risks and uncertainties you should review the forward looking statements disclosure in the earnings press release as well as you know.
Lynch: Our SEDAR filings.
Lynch: During this call, we will discuss <unk> results and <unk>.
Lynch: <unk> financial measures, including adjusted EBITDA, a reconciliation between adjusted EBITDA and the corresponding <unk> results is available in our earnings press release and MD&A, both of which can be found on the IR section of our website <unk> Dot com.
Lynch: <unk> plus.
Lynch: The webcast live and being recorded for playback purposes, an archive of the webcast will be made available on the IR section of our website.
Lynch: Neither this call nor the webcast may be rerecorded or otherwise reproduced or distributed without prior written permission from taxes.
Lynch: Again, our call Bob will discuss the highlights of our quarter and year and recent business developments, followed by Glenn who will review, our financial results and outlook and open the line for questions.
Lynch: A presentation to accompany today's call, which you can download from the Investor Relations homepage of our website. We will let you know when to change sides slides pardon me before I turn the call over to Bob I want to remind you that our user event connections will take place from March 31 to April two in Austin, Texas.
Rick Wadsworth: As for user training, but the full agenda on the first and second are open to investors you can review the details of connections dot com and if you're interested in joining US. Please reach out to me directly at our Wadsworth at <unk> Dot com before are registering as we add capacity limitations.
Bob Courteau: And Bob.
Speaker Change: Good morning, and thank you for joining us today, we really appreciate it.
Speaker Change: I am pleased with Q4 results.
Highlight three key items.
Speaker Change: First.
Speaker Change: Our performance allowed us to add all guidance elements for the year.
Speaker Change: Including SaaS revenue growth total revenue and adjusted EBITDA margin.
Speaker Change: Second and most exciting for us by far was the record incremental <unk> added in the quarter.
Speaker Change: No foreign exchange adjustments to the AR balance at the end of the period.
Speaker Change: Some of that performance as Glenn will discuss.
Speaker Change: I see the strong sales performance in Q4 as one reflection of our elevated go to market team at approach.
Speaker Change: I am confident that we are much better positioned to take full advantage.
Speaker Change: Whatever conditions and opportunities present themselves ahead.
Speaker Change: Longer term the ongoing uncertainties facing supply chains.
Speaker Change: We will also continue to shine a light on can access.
Speaker Change: And the incredible value that we offer.
And third.
Speaker Change: We're also very pleased with our 25% adjusted EBITDA margin in Q4.
Speaker Change: And our near 20% trailing 12 months free cash flow margin.
Speaker Change: Both of which continue to reflect a rapidly improving profitability.
Speaker Change: The results also demonstrate our clear path to consistently consistently achieve our full year normalized adjusted EBITDA margin of 25%.
Speaker Change: Starting no later than 2026 as we've communicated.
Speaker Change: We matched our record for new customers in the quarter and set a new record for full year.
Speaker Change: We're thrilled to have won some large enterprise accounts in Q4.
Speaker Change: Together large enterprise and enterprise companies were the biggest contributors of new customer wins in the quarter.
Speaker Change: As always we're fortunate that we can identify a sample of our new customers.
Speaker Change: It's a privilege to have the strongest references in our space.
Speaker Change: With some of the best supply chain companies in the World.
Speaker Change: A light year research some of the names on the slide but the flexibility of Vice trop.
Speaker Change: To address a diverse set of supply chains is obvious from this group.
Speaker Change: For example, we are helping to orchestrate the supply chain for our global leaders like seller growth.
Speaker Change: Headquartered in France they.
Speaker Change: They make the iconic baby Bell and lapping cow cheeses.
Speaker Change: <unk> Corporation out of Japan, which supplies the plastic resins and an array of the basic chemicals that support modern life.
Speaker Change: Oh Pella also based in France.
Speaker Change: Which is partially owned by Sanofi and focus on consumer self care with well known over the brand over the counter brands like Allegra and Docker lax.
Speaker Change: Finally.
Speaker Change: We also won one of the largest life sciences companies.
Speaker Change: We hope to be able to share their identity with you in the time ahead.
Speaker Change: For 2023, we spoke about a six 2% plus win rate against our competitors and I am thrilled to have repeated that strong performance in 2024.
Speaker Change: Our bar channel also continued to gain momentum by adding several smaller customers.
Speaker Change: And booking trend for this year from this group grew over a 100%.
Speaker Change: In addition to success winning new customers.
Speaker Change: Over half of our gross additions to the <unk> balance in Q4 came from existing customers.
Speaker Change: We have a significant expansion opportunity ahead there.
Speaker Change: It remains an early days, thanks to the near doubling of the customer base over the last three years.
Speaker Change: And exciting new product launches.
Speaker Change: Our success remains anchored in our product leadership and.
Speaker Change: We are thrilled to receive further validation.
Speaker Change: From independent industry observers.
Speaker Change: Can access was named the leader in three IDC markets Cape reports published in the fourth quarter.
Covering <unk>.
Speaker Change: Supply supply chain planning overall.
Speaker Change: Supply chain timing for life Sciences industries.
Speaker Change: And supply chain planning for discrete manufacturing industries.
Speaker Change: Together the reports highlighted importantly can access differentiators.
Speaker Change: Holding statements around how our currency approach supports responsiveness and agility.
Speaker Change: How can access has an incredibly deep understanding of AI solutions, and our supply chain base and our ease of integration.
Speaker Change: In 2024.
Speaker Change: We launched a lifestyle platform and we continue to build out its capabilities, including enhanced and new AI techniques.
Speaker Change: Our next phase ready in Q2, 2025 makes integrating with maestro more standardized faster.
Speaker Change: And more capable as connections to ERP systems, and our solution extension partners.
Speaker Change: Are handled through our new supply chain data fabric.
Speaker Change: The key partner supply chain orchestration.
Speaker Change: <unk> connecting to as many relevant supply chain data sources as possible to improve decision, making so this for US is an important step.
Speaker Change: Over 200 customers have already used our gen AI enabled <unk> chat capabilities.
Speaker Change: To simplify user health, which is bundled into the base functionality.
Speaker Change: In the second half of 2025 for the first time users will be able to chat with their own data.
Speaker Change: Save users significant time.
Speaker Change: And importantly to democratize access to.
Speaker Change: Two important supply chain information.
Speaker Change: Significantly enhancing lifestyle value overall.
Speaker Change: There'll be able ask important questions Blake.
Speaker Change: Which components of my supply plan are more than two weeks late.
Speaker Change: And to follow up are there any gating items created in the late supplier.
Speaker Change: This and future AI enhancements will be revenue generating as they are released.
Speaker Change: There will be an uplift in the 2026 opportunity.
Speaker Change: As a follow on was subsequently launch our agenda AI framework.
Speaker Change: It will enable us delivery use cases that take action needed when asked by users or on behalf of them were processes can benefit from greater automation.
Speaker Change: Referring back to the example on light supply.
Speaker Change: <unk> could instruct maestro.
Speaker Change: Please transfer inventory.
Speaker Change: To resolve the gaming component responsible for late parts at our Ohio State.
Speaker Change: At our Ohio site.
Speaker Change: Future phases will see AI help users create critical maestro resources at implementation or later, improving on our already best in market time to value.
And see AI permeated through the platform.
Speaker Change: For an increasingly powerful interactions.
Speaker Change: Our existing predictive AI capabilities continue to quickly gain traction as well for example, we have tripled account of supply dot AI customers from the beginning of 2024, and we continue to see a strong pipeline ahead.
Speaker Change: We believe my strives at 283 year product advantage managing supply chain orchestration.
Speaker Change: So overall.
Speaker Change: I'm very pleased with the progress we've made through 2024.
Speaker Change: We reorganized the company to improve profitability and reallocate resources.
Speaker Change: The highest priority areas.
Speaker Change: You've seen the impact on our results.
Speaker Change: Our adjusted EBITDA margin grew from 18% in 2023.
Speaker Change: 222% in 2024, and the trend will continue.
Speaker Change: We did a full review of our operational and strategic priorities.
Speaker Change: That confirmed our opportunity as well as key elements of our well established plan.
Speaker Change: Based on that work, we took action to improve in certain key areas.
Speaker Change: Particularly in go to market activities for example.
Speaker Change: We've refocused on our core manufacturing verticals and will press our leadership advantage on these markets.
There are still thousands of new customers to be one there.
Mark: Mark <unk>, our new Chief commercial officer has enhanced our go to market model and add key regional and country leaders.
Speaker Change: So the talent in our sales teams.
Speaker Change: For example, Mark has added a strategic account tier to our team and ensure coordination across the company.
Speaker Change: To make sure that the largest opportunities are getting the appropriate attention.
Speaker Change: He has also refocused the growth of our installed base team.
Speaker Change: To more effectively address the sizable expansion opportunity.
Speaker Change: Represented by our rapidly growing customer base and product set.
Speaker Change: Mark has also created a more established and mature methodology around opportunity qualification account planning and forecasting.
Speaker Change: As a company we have significantly expanded our investment and mind share with key go to market and implementation partners.
Speaker Change: Such as through deals with Accenture NTT data and soon with them for.
Speaker Change: We'll announce details later this quarter.
Speaker Change: The result of our enhanced partnerships.
Speaker Change: We will be better market coverage <unk>.
Speaker Change: Expanded delivery capacity and better client outcomes.
Speaker Change: As we steadily move towards public cloud, our partnerships with Google and Microsoft enhance our delivery and flexibility.
Speaker Change: And then and increase the visibility of maestro and the supply chain space.
Speaker Change: Look we remain full speed ahead on our search for can access next CEO.
Speaker Change: In the meantime, we're so pleased to be executing well.
Speaker Change: With a very experienced and collaborative team.
Speaker Change: The fourth quarter gave you a taste of what all of these improvements combined it means they can access.
Speaker Change: The strong finish to 2024 solidifies our outlook for 2025.
Speaker Change: Looking ahead, we're focused on Anr grow.
Speaker Change: Further progress towards our mid term normalized annual adjusted EBIT target of 25%.
Speaker Change: And the return to consistent rule of 40 performance.
Speaker Change: They have lots of growth opportunities ahead.
Speaker Change: We're better organized.
Speaker Change: However, we also recognize the challenges that our customers face in this new era of global trade.
Blake: With that said I'll turn the call over to Blake.
Blake: Thank you Bob and good morning.
Blake: As a reminder, unless noted otherwise all figures reported on today's call are in U S dollars under <unk>.
Blake: Let's move to slide nine.
Blake: I am very pleased to report strong Q4 results.
Blake: Frankly, it's the best quarter, we've ever had.
Blake: Also full year guidance elements, but most importantly in the quarter, we added a record incremental amount of our <unk>.
Blake: As with other global software company recent fluctuations in foreign exchange relative to the U S. Dollar are masking the strength of some of the headline results, including <unk>.
Blake: And <unk> balances.
Blake: Our 2025 guidance.
Blake: But the underlying performance in the quarter is very clear.
Our adjusted EBIT margin in Q4, with very strong game reinforcing our path to consistent normalized 25% plus performance starting in 2026.
Blake: And supporting ongoing strength in our trailing 12 month free cash flow margin.
Blake: Briefly for the quarter.
Blake: Total revenue was $123 9 million.
Blake: Up 11%.
Blake: <unk> revenue was $81 9 million.
Blake: Up 17%.
Blake: Our subscription term license revenue was $1 $6 million.
Blake: In line with our expectations given the renewal cycle.
Blake: Professional services revenue was $35 1 million.
Blake: Up 2%.
Blake: Project scheduled and foreign exchange fluctuations impacted results.
Blake: As I talked about before our goal is to continue to ship professional services work to partners does remains our priority business.
Blake: Maintenance and support revenue was $5 4 million up 11%.
Blake: Our gross profit was up 9% to $75 1 million or 61% gross margin compared to 62% in the same quarter last year.
Blake: Professional services gross margin remained very strong at 29%.
Blake: The software margin was 73% and was impacted by roughly four percentage points due to an impairment of intangible assets related to certain legacy technology no longer use.
Blake: This charge impacted total gross margin by just over three percentage points.
Blake: Otherwise software and total gross margin by more favorable compared to Q4 <unk> results.
Blake: Adjusted EBIT was extremely strong up 59% to $31 5 billion.
Blake: <unk> at 25% margin versus 18% in the comparable quarter.
Blake: This reflects our continued heightened focus on profitability and relates to very successful initiatives throughout 2024 and earlier aimed at gaining operating leverage as we scale.
Blake: Our strong growth and profitability performance resulted in rule of 40 performance in the last few quarters.
Blake: Calculated by adding SaaS revenue growth and adjusted EBIT margin our usual approach.
Blake: This lend support to Bob's comment that a return to consistent full year growth of 40 performance feels very much attainable ahead.
Blake: Our loss in the quarter was $16 $3 million.
Blake: Or <unk> 58 per diluted share versus a profit of <unk> 14 per diluted share a year ago.
Blake: This result was fully attributable to a few key onetime items worth noting.
Blake: First.
Blake: We incurred a onetime tax expense of $17 5 million or 80, transferring certain regional market rates within business entities in our corporate group, allowing for more appropriate tax planning ahead.
Blake: Yes.
Blake: Second we arrived at our final settlement and a legal dispute with a competitor which resulted in a change to general and.
Blake: Administrative expenses in the quarter.
Blake: Under the agreement terms arent being disclosed, but we're pleased with the results and that distraction is behind us.
Blake: We remain proud that the widely acknowledged leadership positions and success of our <unk> platform is a direct result of 40 years of building industry knowledge and relentless proprietary development efforts to uniquely address the market's needs.
Blake: Finally, <unk> was impacted by the impairment of intangible assets related to certain legacy technology, no longer being used which impacted both gross margin as discussed and G&A expenses.
Blake: Without these one time items it was a solidly profitable quarter.
Blake: Cash flow from operating activities was $24 1 million compared to $28 million.
Blake: In Q4 2023.
Blake: The cash impact of the tax expense and the legal settlement I just mentioned will occur in the first quarter of 2025.
Blake: Cash cash equivalents and short term investments were $298 5 million up from $293 million at the end of 2023. Despite expenses in the year that we don't expect to recur and our active share buyback program affecting at all.
Blake: Going on to slide 10.
Blake: Our trailing 12 months cash flow margin remained strong at 19, 6% a great reflection of our increased focus on profitability.
Blake: As always we pride ourselves on BS strongly cash generative.
Blake: Tony.
Blake: On slide 11, I will leave it to you to review our full year 2024 results in greater detail.
Speaker Change: I am pleased that we met all our guidance element and particularly pleased that our adjusted EBITDA grew beyond $100 million for the first time and up 40%, 42% in the year.
Speaker Change: Reflecting a 22% margin, which is at the top of our guidance range and up significantly from 18% last year.
Speaker Change: We also achieved record free cash flow of $95 million in the year.
Speaker Change: A record number of new customers.
Speaker Change: 60% plus win rate against.
Speaker Change: Key competitors and maintained 95% to 100% gross customer retention for the year.
Speaker Change: I'd like to thank the whole can accurate team for what our healthy results in a challenging year across SaaS enterprise software universe.
Speaker Change: Moving to slide 12, our annual recurring revenue or <unk> grew by 14, 14% on a constant currency basis.
Speaker Change: Or by 12% to $360 million on an as reported basis.
Speaker Change: This represents meaningful acceleration from 12% constant currency growth last quarter.
Speaker Change: We experienced record incremental <unk> in Q4, no achievement gets partially masked when looking at the period end balance due to the foreign exchange impact.
Speaker Change: Incremental <unk> was over 38% higher than in Q4, 2023, and more than $4 million higher than the previous quarterly record in Q3 <unk>, excluding the air added as part of our <unk> acquisition a quarter.
Speaker Change: The split of additions to <unk> between new name accounts and expansion of the business was 47% to 53% in Q4.
In general we have a significant opportunity to grow air from installed base and we are focused on it.
Speaker Change: For the year, the new name to expansion business split was 55 to <unk> 45 and via revenue customers.
Speaker Change: On slide 13.
Speaker Change: Our three year CAGR for total RVO and Todd RVO is 18, 4% and 28% which has declined slightly but remained strong.
Speaker Change: The period end balance was impacted by foreign exchange adjustment.
Speaker Change: 2024, being a lower renewals here.
Speaker Change: That figure continues to reflect our elite gross customer retention.
Speaker Change: The three year result is the best way to analyze RVO as it normalizes for expected quarterly fluctuations and customer renewal cycles. So we continue to direct your attention to those results.
Speaker Change: More details on our <unk> can be found in the revenue note to our financials.
Speaker Change: On slide 14.
Speaker Change: Im pleased to be initiating our 2025 guidance.
Speaker Change: Given the current impact of recent unfavorable foreign exchange movements, which we expect will continue ahead I will provide certain key guidance elements on both an as reported and constant currency basis.
Speaker Change: We model as reported guidance using the December 31 rates and modest constant currency guidance using average FX rates.
Speaker Change: 2024.
Speaker Change: For 2025, we currently expect.
Speaker Change: Total revenue at $535 million to $550 million or 12% growth at the midpoint or $545 million to $560 million in constant currency or 14% growth at the midpoint.
Speaker Change: That is growth of 11% to 13% or 12% to 14% in constant currency.
Speaker Change: We expect typical cyclicality within the year to apply including slower incremental business in Q1 and strength in Q4.
Speaker Change: Subscription term license revenue of $16 million to $18 million.
Speaker Change: Roughly half the amount is expected in Q1, approximately one quarter in Q2, and the remainder split over the back half of the year with Q3 being somewhat higher in Q4.
Speaker Change: We will continue to be encouraged our on premise customers to move to the cloud.
Speaker Change: <unk> could change our outlook for term license revenue.
Speaker Change: We expect adjusted EBIT margin to be 23% to 25%.
Speaker Change: To help you with your model I'll add some further commentary.
Speaker Change: As usual, we will give you a longer term view of our subscription term license revenue based on known renewal cycles today.
Speaker Change: We expect this revenue to grow by roughly 55% from 'twenty five 'twenty six.
Speaker Change: And then returned to slightly slightly below 2025 levels in 2027.
Speaker Change: We expect gross margin to take another small step forward in 2025.
Speaker Change: Mostly due to gradual improvements in the software margins due in part the recent closure of our APAC Datacenters and higher subscription term license revenue.
Speaker Change: We will start moving out of our private European data centers towards the end of 2025 and into 2026.
Speaker Change: When we will also start migration of North American data Center.
Speaker Change: We expect the following trends for operating expenses on a percentage of revenue basis relative to fiscal year 2024.
Speaker Change: You should expect slightly higher sales and marketing as we continue to reinvest into the opportunity as previously discussed.
Speaker Change: Slightly less on R&D as we continue to gain operating leverage.
Speaker Change: And notably less on G&A at 2024 was an unusual year IDEXX.
Speaker Change: I would expect closer to 30% to 40% of revenue, which is more in line with historical results.
Speaker Change: With respect to Capex in 2025, we expect to invest approximately $10 million to $13 million with some ongoing investments into remaining private data centers up.
Speaker Change: Upgrades to international office offices to support expansion and.
Speaker Change: And refreshed network and desktop equipment to support key R&D initiatives.
Speaker Change: Going on to slide 15.
Speaker Change: We've continued to be active in our normal course issuer bid.
Speaker Change: For the year between our previous plan, which ended November five 2024, and our current plan.
Speaker Change: We repurchased 881454 common shares for an investment of approximately $98 3 million.
Speaker Change: Including 157156 shares and $20 million in the fourth quarter.
Speaker Change: These purchases significantly significantly exceed any dilution from our stock based compensation plan for the year and I'm pleased with the investments.
Speaker Change: Our current NTIC goes through November five 2025.
Overall, I am pleased with progress in the business we.
Speaker Change: We delivered an outstanding Q4 in terms of incremental bookings, adding to our foundation for future growth.
Speaker Change: While foreign exchange volatility remains a significant issue globally, you should focus on momentum in our constant currency <unk>.
Speaker Change: We're building on our product leadership, which continues to be acknowledged by industry watchers and leveraged by customers.
Speaker Change: Usage of our scenario analysis has doubled hitting on unprecedented levels as customers respond to mounting pressures and global trade.
Speaker Change: We will continue investing for growth, while managing for increased profitability and free cash flow and are executing exceptionally well in that regard.
Speaker Change: We remain firmly committed to our mid term adjusted EBIT target and returning to consistent full year rule of 40 performance.
Speaker Change: So all of you listening and as always thank you for your ongoing interest and support to date.
Speaker Change: We're excited about the future and welcome you to the next step in our journey.
I will now turn the line over to the operator to start the Q&A session.
Speaker Change: At this time I would like to remind everyone.
Amit: Good question, Chris <unk>, and gentlemen, Amit telecom.
Speaker Change: We will pause for just a moment chicken pad.
Speaker Change: The first question comes from Richard <unk> from National Bank Financial markets. Your line is open.
Speaker Change: Yes. Thank you.
Speaker Change: Congrats on the nice results here.
Speaker Change: And Bob just you had mentioned that Youre still full steam ahead on the CEO search I was wondering.
Speaker Change: Things like is there a timeline to have someone in place and then secondly, maybe more important is.
Speaker Change: What is the sort of primary skill profile. The board is looking for in this new CEO.
Speaker Change: Yes.
Thanks for the question <unk> permit.
Speaker Change: Look it's going well.
Speaker Change: The first thing and I've said it quite a few times is that this is a scale up the work. We did in 2024 is really preparing the company for what's going to happen over the next five to 10 years.
Speaker Change: We've done a lot of the heavy lifting.
Speaker Change: First thing I would tell you is there's lots of interest I think the performance in the quarter.
Speaker Change: The work that we did makes it even.
Speaker Change: A better company.
Speaker Change: As we go forward.
Speaker Change: So the real.
Speaker Change: Key here is to establish a position where the CEO is really about a plus up.
Speaker Change: <unk>.
Speaker Change: Our real focus right now is to get it right the work that we've done.
Speaker Change: The talent that we've added and the team puts us in a great place as we go forward and we're just completely focused on getting it right.
Speaker Change: With an overweight on Nextgen can access AI.
Speaker Change: Product management, how we go to market.
Speaker Change: And all the things that make a great company for the next five to 10 years and so making good progress.
More important to get it right and set a date.
Speaker Change: Okay.
Speaker Change: And then with respect to the backdrop and no doubt there is.
Speaker Change: No questions about supply chains going forward and the complexities that are likely coming here.
Speaker Change: So you didn't talk much about the pipeline, but given that backdrop and then I understand you obviously gave a bit cautious on the macro but has the level of engagement kind of picked up with all of that through coming towards us.
Speaker Change: Yes, the level of engagement with customers that own lifestyle now has never been higher like its pandemic level engagement and they have the advantage of being able to.
Speaker Change: Plan.
Speaker Change: Take two what happens next.
Speaker Change: And because of that and it has tightened industry and supply chain.
Speaker Change: That is good people are.
Speaker Change: Absolutely I mean Q4.
Speaker Change: It is a good illustration against the backdrop of other players in the industry or our ability to.
Speaker Change: When customers start new projects and the level of interest in our company is high.
Speaker Change: Our guidance.
Speaker Change: <unk>.
Speaker Change: Our.
Speaker Change: As against a backdrop that we know that FX is really going to change things quite a bit we're going to see a lot of variability.
Speaker Change: Our customers are super busy.
Speaker Change: We wanted to put.
Speaker Change: Responsible guidance in place, but that's against a backdrop, where way better control of our business. We got a really good win rate and the enthusiasm and interest in our company is high so.
Speaker Change: We're trying to strike a really nice balance as we go into.
Speaker Change: 2025.
Speaker Change: But we're feeling very good yes, maybe I'll it's Adam.
Speaker Change: Couple of comments on there the as Bob had mentioned.
Speaker Change: What we're seeing in our install base and the expansion opportunities in our pipeline is by far the largest we've ever seen in our pipeline right now we're extremely happy with where the pipeline is.
Speaker Change: There is elements of it growing a lot faster than others.
Speaker Change: Enterprise and large enterprise, they're in similar size.
Speaker Change: For where we would expect at this stage.
Speaker Change: One of the best parts, we've had over the past year is obviously, bringing somebody like Mark Margaret.
Speaker Change: On the team.
Speaker Change: The quality of the pipeline has improved significantly and we saw that actually in Q4 in terms of how we were able to execute on the pipeline that we had available to us.
Speaker Change: No.
Speaker Change: I think we're in a great position with our pipeline continue trying to execute at the highest levels.
Speaker Change: Okay. That's great. That's helpful. Thank you.
John Nelson: The next question comes from John Nelson of companies from BMO capital markets. Your line is open.
John Nelson: Good morning.
Speaker Change: Just expanding on the extension opportunities.
Speaker Change: Our total weighted more towards customers deploying into new corporate business units.
Speaker Change: Or has it been more payouts.
Speaker Change: Mers buying new modules.
Speaker Change: And it's about.
Speaker Change: I mean, we get we get paid for scenarios, we get paid for new modules.
Speaker Change: Around AI.
Speaker Change: Absolutely have a roadmap here going into the second half of year and into 2026, where we'll be bringing out new products and the way that the way to think about it is that.
Speaker Change: I already said arguably.
Speaker Change: I believe we have a two to three hedged three year head start.
Speaker Change: On the competition.
Speaker Change: Not only is AI give us economic opportunity it gives us product differentiation and most importantly, it creates incredible value for the customers and all of those standards are going to translate.
Speaker Change: Ideally onto our existing customer base, but it also support and contribute to our sustaining high win rates in our category. The other thing that.
Speaker Change: It is coming up is planning is at the center of supply chain.
Speaker Change: What to do and we believe in partnership with other companies.
Speaker Change: And also in terms of how we deploy AI will be able to grow our tam by.
Speaker Change: Being.
Speaker Change: Providing orchestration across the supply chain, where our products are going to be able to deliver information for different types of users new users and the like so does the short term as good to go to our customer base.
Speaker Change: Our product strength grows our advantaged continues and we have an opportunity to increase our Tam it's all of the above.
Speaker Change: Great.
Speaker Change: Then a question for Blaine I'll.
Speaker Change: With respect to the software gross margins.
Speaker Change: Notwithstanding the onetime charge.
Speaker Change: Can you remind us what kind of margin uplift you would expect relative to current levels. Once you do complete the transition to a public cloud and the Commission's private data center.
Speaker Change: Yes sure.
Speaker Change: So I think a couple of years ago I've mentioned there is vote.
600 basis points difference between how we calculated our.
Speaker Change: Our margins.
Speaker Change: Based on private cloud versus public cloud.
Speaker Change: Half of that is related to amortization depreciation should we take that out theres about 300 basis point improvement that we have sitting out there once we get through to the completion of this I will say.
Speaker Change: There are some optimizations and technology things that we are looking at that could improve that beyond 300 basis points, but as of right now.
Speaker Change: If we're just looking at what we had before and what we have currently going to public cloud I think there's 300 basis points of duplicative costs that that will go away.
Speaker Change: Great I'll pass the line thank.
Speaker Change: Thank you.
Paul Treiber: The next question comes from Paul Treiber from RBC capital markets. Your line is open.
Paul Treiber: Alright, thanks, very much and good morning, I was just hoping that you could walk through some of the moving parts.
Paul Treiber: AOR growth this quarter in our appeal.
Paul Treiber: Growth this quarter.
Paul Treiber: Then.
Paul Treiber: Pacifically to what degree is driven both by by new wins.
Paul Treiber: This is versus expansion phase deals that would uplift.
Speaker Change: Yes sure.
Speaker Change: Well, let me just start with.
Speaker Change: Quickly with what we're seeing in terms of like.
Speaker Change: Foreign exchange and foreign exchange is almost like right now.
Speaker Change: At Beach ball in the windstorm in terms of like you just don't know where it's going to land.
Speaker Change: It's been all over the place.
Speaker Change: If you take the.
Speaker Change: Our big three foreign currencies that we gain revenue from than we have in our <unk> and <unk> balances.
Speaker Change: We have euro we have GBP and we have Japanese yen, they represent about 32% to 33% of our of our.
Speaker Change: I guess currencies foreign currencies come into revenue that we have to translate.
Speaker Change: And you think about each one of them the euro year over year went down six 2%.
Speaker Change: <unk> went down one 7% and Japanese yen has fallen about 10, 6%.
Speaker Change: Have huge impact in terms of how we look at our ending balances for both <unk> and ARPA.
Speaker Change: We had.
An exceptional quarter in terms of gross bookings.
Speaker Change: Side of the fact that foreign exchange played around with those <unk>.
Speaker Change: Level.
Speaker Change: It was a slightly.
Speaker Change: Slightly higher amount that came in from.
Speaker Change: New business versus renewals, although we had a good renewals quarter. The renewal of the year was down year over year, just because of the renewal cycles that we have in place and that was.
Speaker Change: Why you saw lower RPI that came through but again.
Speaker Change: We had around something around $18 million of hit on the <unk> just because of foreign exchange. So you could expect that theres a higher amount.
Speaker Change: <unk>.
Speaker Change: We'll come in once we get those with currency back in the right spot.
Speaker Change: In terms of IRR.
Speaker Change: <unk> happy with the growth that we had in Q4, the incremental announced was it was beyond all of our expectations for what we what we saw in Q4 and that was a great spot.
Speaker Change: I think we are in.
Speaker Change: In a much better position and I think that the thing that I'm really concentrating on is the change in direction. The momentum that we saw on constant currency in Q4 was a great first step in the direction that we expect to go for the rest of 2025.
Speaker Change: Thanks, That's helpful. And then just on your last point looking at the.
Consequently, <unk> growth in the quarter versus the SaaS guidance for the year on a constant currency basis. The SaaS guidance. There was a little below the AOR growth. How you think about like the SaaS growth on a constant currency through the year and bookings potential through through 25.
Speaker Change: We're feeling good about our bookings in Q4.
Speaker Change: It's kind of one of those those markers that you say okay.
Speaker Change: We've got the momentum behind US we got the tailwind behind US we don't get to Pryor in front of ourselves there is a lot going on.
Speaker Change: The macro right now it feels like people are changing their mind, all the time, but I will say that we are.
Speaker Change: Now set up for success I think the scenario analysis is a great example of something that <unk>.
Speaker Change: People are using our customers are using over and over again right now see it doubling basically in the first months of the year when Theres a big change in a lot of tariff discussion that's happening.
Speaker Change: We think that we're in we're in high demand right now and our ability to execute and have the best.
Speaker Change: Product out there I think puts us in a really strong position.
Speaker Change: Thanks, Thanks for taking the questions.
Speaker Change: The next question comes from Kevin Questioner Atkins from Scotiabank. Your line is open.
Speaker Change: Hey, there good morning, congrats on the on the <unk> trend.
Speaker Change: <unk>.
Speaker Change: Can I, maybe dig into what drove that strength.
Speaker Change: Seeing any slight shifts in the macro that are helping the enterprise customers.
Speaker Change: Closing on deals you also referenced that the changes that the go to market a lot of different things that that were going on there I'm just trying to get a sense of what.
Speaker Change: One of the key drivers of that strength and then second one on that go to market change.
Speaker Change: Are you are there still more changes to come Q1, Q2 before everything is kind of.
Speaker Change: Up to the level of what you'd like it to be at.
Speaker Change: First thing I'd say is that we have added <unk>.
Speaker Change: Significant.
Speaker Change: High quality people into our go to market business and grew EBITDA margins and so the big thing that happened in 2024 has reset our priorities around spending and so the thing you need to know.
Speaker Change: And the churn that we have put is this isn't a cost savings plan.
Speaker Change: Try and give EBITDA margins, it's a re prioritization of our focus and I would characterize Q4.
Speaker Change: And as we go into 2025.
Speaker Change: As as the.
Speaker Change: The most important thing that's happened as everyone understands the importance of new revenue growth, whether it's in the existing base with our customer support teams.
Speaker Change: It's with our services teams working with software, whether it's adding new talent, whether it's supporting the salespeople in place and much higher rates of executive engagement myself, Mark Moore again, Blaine the whole team is engaged on what we would call.
Speaker Change: Company the company sell in in a more systematic way and frankly, even John said card.
Speaker Change: Last quarter was a big part of the success fees.
Speaker Change: He is down here he has been helping us with strategy is.
Speaker Change: Customer confidence next week with Mark, which is a really important customer conference.
Speaker Change: He is going to be it can act connection so is continuing to support for the company and it's been fantastic.
Speaker Change: We are doing with great enterprise companies do we got the whole company focused on growth.
Speaker Change: We're doing it with a set of priorities.
Speaker Change: That is really precise.
Speaker Change: At at.
Speaker Change: All company event last week.
Speaker Change: Got it.
Speaker Change: On the call has heard about the change or the loss share where we brought mckinsey Goldman than other people in to help with the company I've told them that.
Speaker Change: All of that work and all of the advice, we got and everything that we're doing we're doing fewer things that are really important batteries really making ourselves a very efficient company in the short term, but those priorities are the ones that can allow us win for a long time. So we just we just had a great year.
Speaker Change: Organized teams fired up companies excited.
Speaker Change: And we're winning.
Speaker Change: Great I appreciate all that color there Bob.
Speaker Change: Second question you referenced later on in the year. Some more gen. AI features being able to chat with Indiana and that might I think you talked about an uplift.
Speaker Change: 2026, so I'm just wondering how do we think about that model is there any way to.
Speaker Change: Quantify what type of how you're thinking about.
Speaker Change: How that could work through exterior numbers. Thanks.
Speaker Change: So.
Speaker Change: Here's what you are hearing from the team here.
Speaker Change: And our guidance in their language.
Speaker Change: The strategy is really tight and the goal now is to make this quarter that we're going to make next quarter and then we're going to make the quarter after that.
Speaker Change: We're not trying to get ahead of our skis, we're not trying to dismiss the challenges for our customers.
Speaker Change: We're totally focused on the things that matter for the long term, obviously, but we really have sharpened our edge around trying to make the corridors.
Speaker Change: And Thats, what our investors want that's what.
Speaker Change: Is a great compound.
Speaker Change: I think we've got some pretty good edge going around that I don't know Blaine do you want to add to that yes, I think.
Speaker Change: Our number one goal is to concentrate on continuing to accelerate <unk> in the right direction and.
Speaker Change: We're in the process of finalizing pricing around what we're going to do with chat with data.
Speaker Change: And then following that we will have the agenda items that.
Speaker Change: A little bit later in the year, so two really big.
Speaker Change: <unk> for what customers utilize and get in front of themselves to be more efficient as we go forward.
Speaker Change: I would not expect that it will have a huge impact on SaaS I do think it will have an impact on our growth as we go forward and that's something that we're pretty excited about at this stage.
Speaker Change: Got it.
Speaker Change: The other thing I'd say on that is like at the end of the day.
Speaker Change: Our AI product road map.
Speaker Change: Definitely sustains our product advantage in that category.
Speaker Change: Today's macro environment of uninsured trade and FX that is what people are buying and interested in and we do it better than anybody else because we've already introduced AI into our product to be able to actually produce.
Speaker Change: Provide scenarios.
Speaker Change: And nobody else doesn't like we did so we're in a great position to.
Speaker Change: To monetize this business in the short medium and long term.
Speaker Change: Thanks, Pat good morning, Thank you.
Zachman: The next question comes from Zachman valves from Redburn.
Speaker Change: Your line is open.
Speaker Change: Okay.
Speaker Change: Hi, Bob.
Speaker Change: Thanks for the question.
Speaker Change: I see.
Speaker Change: You delivered the one two or three times in the first nine months of 2024.
Speaker Change: You're able to provide any color on that on how that bad in the fourth quarter.
Speaker Change: And how do you look at the FY 'twenty five revenue outlook is there expected to be a meaningful contribution from these size deals that you secured last year or should we expect as more contributing.
Speaker Change: Contributing to Audi alright. Thanks.
Speaker Change: Sure Good question.
Speaker Change: Yes, so we've been giving that ratio in the past.
Speaker Change: We didn't this time I'll give you a number right now it's $1 one sixth of what we ended the year at it actually the exact same number that we had the before and what really.
Speaker Change: <unk> defines why it's important is when you see either acceleration or deceleration of that ratio compared to prior periods and that got kind of moved into your second question, which is how does it impact.
Speaker Change: I, sometimes called free <unk> going forward.
Speaker Change: So we do have three air it's going to be higher than we had in 2024.
Speaker Change: And so we have some free are coming in 2025.
Speaker Change: Depending on how that ratio moves if it stayed stable.
Speaker Change: It'll be an equal amount of cancellation on the var.
Speaker Change: <unk> that comes out from this will be deferred for future periods.
Speaker Change: This stage one six is where we ended the year gained very similar to what we had in 2023, but.
Speaker Change: We did have a couple of fairly large ramp deals in Q4, but not as much as we had in the first three quarters of the year.
Speaker Change: Alright, thanks for the detail and on the presentation, you highlight that greater than 20 customers engaged with <unk> II.
Speaker Change: How should we reconcile that number with the 100 that were actively using the tool at the end of last quarter.
Speaker Change: Meaningful step up in that will take up over the last three months in that product.
Speaker Change: Yes, yes.
Speaker Change: A doubling in three is our highest uptake of any product.
Speaker Change: The way that we obviously talked about.
Speaker Change: But the chart agent is that it is something that.
Speaker Change: Help seed our current customer base for understanding that the next step is to move on to chat with data and then the next step after that is agenda. So.
Speaker Change: We have over 200 customers currently using it.
Very strong feedback as to how great. It is and how much it makes things much more efficient.
Speaker Change: I think the chart with data we are in a board meeting over the last couple of days I got to see even more views on what that looks like it.
Speaker Change: It is going to make customers much more efficient over time and automation that it provides at the fingertips.
Speaker Change: As.
Speaker Change: I think a game changer.
Speaker Change: Alright, Thanks, Thats all from me.
Speaker Change: The next question comes from Stephanie price from CIBC. Your line is.
Stephanie Price: Good morning.
Speaker Change: Hi, Stephanie.
Speaker Change: Okay, Here's a flag declining professional services revenue growth just given small initial deal sizes and Steve Ellis looks like in Q4, yes revenue gross was with the lowest we've seen in a while.
Speaker Change: And if you kind of back into the PFS Youre expecting your guide it looks like it's going to be well above where it was in Q4, just if you could talk a little bit about the PSS line and what you're seeing there.
Speaker Change: Yes.
Speaker Change: Obviously things that are in our control.
Speaker Change: Whether or not we.
Speaker Change: Actively push things through our partners.
Speaker Change: Within our control.
Speaker Change: We have seen a very nice trend in terms of our partners getting more of those those deals and we've been actively trying to support them.
Speaker Change: One is aware of we have a very strategic relationship with Accenture and.
Speaker Change: Trying to ensure that they meet their own targets, but our priority right now and going forward, we will continue to be subscription business. We.
Speaker Change: We did have a couple of.
Speaker Change: Contracts with.
Speaker Change: Okay.
Speaker Change: The impact that we're a fixed fee type of contracts that makes it harder to actually grow on a variable basis foreign exchange impacted results.
Speaker Change: Overall again I think the most important point to take away from this is that we've done a lot better job of redirecting the professional services work and the direction of our partners and I think that also.
Speaker Change: And contribute to why we had a really strong Q4.
Speaker Change: Yes.
Speaker Change: Our an ACB growth that we had.
Speaker Change: Okay. That's good color and then and there.
Maybe on your adjusted EBITDA in the quarter included quite a bit of special charges and I know you had a settlement with the competitor in the quarter, but curious if you could talk about what's embedded in the EBITDA guide in terms of special charges and how we should think about that for 2025.
Speaker Change: Yes.
Speaker Change: I'll be Frank I don't like having a kind of adjustments or special charges at all and so I am pretty happy. The fact that we have very little if any special charges going forward I think we're in a much better position to.
Speaker Change: Ill go back to normal in 2024 as we all are aware that there was a little bit of.
Speaker Change: A different type of year for us we had some unusual transactions that we don't think are recurring.
Speaker Change: We don't expect that to.
Speaker Change: To come.
Speaker Change: Come back in 2025, so there is no guide that has.
Speaker Change: Our our guide right now it doesn't have any of the special charges.
Speaker Change: Coming out.
Great. Thank you.
Speaker Change: Your next question comes from Japan.
Speaker Change: Your line is open.
Speaker Change: Good morning, guys.
Speaker Change: The first question I wanted to touch on the new product cycle with Maestro, it's really good to hear that usage and engagement.
Speaker Change: As the spiking higher.
Speaker Change: Good proof point, just curious does that being led by net new customers.
The adoption there or is it really upgrades from the base.
Speaker Change: Thats driving this activity.
Speaker Change: Yes, I think what Youre seeing is.
Speaker Change: Some of our more mature customers because they had the newer customers.
Speaker Change: In the process of deployment.
Speaker Change: Yes.
Speaker Change: The usage and the amount of scenarios that we're seeing right now are those customers that are that are live obviously in.
Speaker Change: Using it to their critical capabilities.
Speaker Change: Yes.
Speaker Change: It's more mature customer base.
Speaker Change: Yes.
Speaker Change: Continuing to use more and more of our product.
Speaker Change: Okay, Okay great.
Speaker Change: Ed.
Speaker Change: The second question I had.
Speaker Change: It was more around your platform strategy in the past you guys had called it rapid response as a platform.
Speaker Change: This strategy has been in play now for a number of years and looks like you guys have made some really good progress in expanding the partner side of that.
Speaker Change: Can you speak a little bit about how much revenue is being driven from new solution extension partners today, and where could this revenue mix go over the medium to long term.
Speaker Change: Yes.
Speaker Change: The buyer and select business, we're super excited about doubled.
Speaker Change: Last year and its contribution.
Speaker Change: Our expectation is we will continue that trend.
Speaker Change: And it becomes an important part of our geographic expansion it becomes an important part of our value extensions.
Speaker Change: It creates.
Speaker Change: More coverage.
Speaker Change: At spotting for our customers it allows us to get in.
Speaker Change: Track new.
Speaker Change: Industry capacity all of these things.
Speaker Change: Contribute to the.
Speaker Change: The strategic positioning of.
Speaker Change: The company to operate as a global company and.
Speaker Change: The neat thing is with the investments we've made in geography and.
Speaker Change: In the partner ecosystem are now starting to pay in a way that not only.
Speaker Change: It gives us better coverage.
Speaker Change: Supports our ability to.
Speaker Change: To work with the largest companies in the world.
Speaker Change: But that it also is starting to pay.
Speaker Change: I would see I would have seen some of the work that we've done over the last few years is.
Speaker Change: The cost of scale.
Speaker Change: And by making those investments and geography partners and the like we're now has seen that is becoming more profitable and it's part of the EBIT margin story, yes.
Speaker Change: Yes.
Speaker Change: I think exciting things that.
Speaker Change: Although how much we talked about or if we should we should probably talk about more as we've been working on our supply chain data fabric.
Speaker Change: That can be a key part of the architecture of the maestro platform.
Speaker Change: It's going to be a key aspect of supply chain orchestration.
Speaker Change: Which should seamlessly absorb absorb and shared data from as many supply chain sources as possible and that will improve the decision making end to end. So this data fabric that we're working on right now which.
Speaker Change: I think everyone understands is one of the key aspects of not only how people are using AI in general going forward, but just the orchestration you have end to end across supply chain.
Speaker Change: And that's something that we're pretty excited with the progress and something that.
Speaker Change: Hopefully, we can differentiate from our competitors going forward.
Speaker Change: Great. Okay. Thank you for taking my questions.
Speaker Change: Congrats on the New records this quarter guys.
Speaker Change: Thank you.
The next question comes from Mark and Tanya from ATB capital markets Youre in.
Speaker Change: Line is open.
Speaker Change: Thank you very much for taking my question folks.
Speaker Change: Wanted to dig into that incremental <unk> number.
Speaker Change: It looks like its 2020 plus.
Speaker Change: Sure.
Speaker Change: And just wondering if you can kind of talk about the drivers and let us know if theres any unusuals in there that should we should be aware of.
Speaker Change: Yes, the only.
Speaker Change: And you're going to make sure I caveat my sentences that the foreign exchange, we took out the foreign exchange, obviously has an impact just to make sure that was apples to apples that you could compare again.
Speaker Change: The unusual we had was just the execution it was extremely high conversion.
Speaker Change: I look back to Q3, 2022, and I already talked about that quarter I'd like we just closed everything.
Speaker Change: Every deal that we had in the pipeline just kind of started coming in and I would say Q4 of 2024. It was a was very similar to that in fact, the conversion rates that we had for those two quarters.
Speaker Change: <unk>, one and two in the charts right now.
Speaker Change: Okay.
Speaker Change: If anything what we realized is the demand for our product is extremely high.
We had a leadership team on the go to market side that where it was able to execute at the highest levels.
Speaker Change: And.
Speaker Change: I was I will say I was puzzled.
Speaker Change: Pleasantly surprised.
Bob Courteau: Bob here knows that.
Bob Courteau: We're not expecting that quarter that we had in Q4 and to be able to execute that level gives me a lot of confidence in where we're going in the future.
Bob Courteau: A lot more bullish.
Speaker Change: Hey, listen.
Bob Courteau: Lucky.
Bob Courteau: The way to summarize it.
Bob Courteau: Look, it's an industry where people compare their ability to operate supply chain each other and they go to conferences together.
Bob Courteau: And.
Bob Courteau: Macro environment, we're seeing.
Bob Courteau: Post the U S election.
Bob Courteau: Was a bellwether on the importance of having a product a solution like lifestyle and their business.
Bob Courteau: I think that what <unk>.
Bob Courteau: Help us in the quarter as the reference is the ability to get time to market.
Bob Courteau: <unk> need to have the product that nobody else has in the market with a level of sophistication. We have it's become a must have to run your business in that and when you think about what's going on with tariffs and free trade.
Bob Courteau: The reason that they are such a spike in scenarios.
Bob Courteau: Really really hard to understand exactly how things are going to play out while your cost base is shipping routes alternative so.
Bob Courteau: This trend is not going to change in the short term and so obviously it creates some risks obviously, we've seen it with some of our competitors.
Bob Courteau: But it also creates for us an amazing tailwind because we're the leader where we have the product that people need to operate their business right and so what we're trying to do is really project forward a balanced view of our position, which is strong with the challenges for our business. These days.
Bob Courteau: But it helped us in Q4 for sure.
Bob Courteau: Fantastic.
Speaker Change: Can you, let us know how much pricing is in that incremental IRR number.
Speaker Change: Very little if any.
Speaker Change: Price changes in Q4.
If I may give ask one more can you talk about professional service revenue.
Speaker Change: Growth in the quarter.
Speaker Change: Decelerated meaningfully.
Speaker Change: I mean, it's common theme, we're seeing in the quarter, but in your guide. It appears that you are pretty.
Speaker Change: Optimistic that those.
Speaker Change: Bit of an anomaly can you talk us through that.
Speaker Change: Yes, Q4 is always a slower quarter for processors, just because of how the contracts work.
Speaker Change: The more vacation have obviously Christmas holidays platelet partnered it slows down the amount of.
Speaker Change: The ability to generate revenue, we actually get our largest revenue base coming from Q2 and Q3 on professional services using.
Speaker Change: Now, saying that.
Speaker Change: As much as we are trying to push in the direction of our.
Speaker Change: Of our partners with a higher base of <unk> that we're growing.
Speaker Change: New incremental era that we're growing.
Speaker Change: It will help push the professional services revenue up no matter what.
Speaker Change: But again.
Speaker Change: We're on a tight rope here in terms of we are trying to push but we do have.
Speaker Change: Certain commitments that we want to it's still a hold within the organization to hit revenue targets that we have and so we are on a constant trying to slow down.
Speaker Change: Professional services as a percentage of total revenue.
Speaker Change: But and in turn we're hoping that helps accelerate the subscription revenue that we were really focused on.
Speaker Change: And we're also trying to.
Speaker Change: Part of our multi year.
Speaker Change: Profitability story is darci improve the profitability of services as well these things all work hand in hand.
Speaker Change: And then the final one is.
Speaker Change: Over time, we're going to make it more or less it's already one of the.
Speaker Change: Software products at the enterprise level and time to value, we're going to keep pushing that we're going to make it easier to implement and that puts that puts pressure on professional services as well.
Speaker Change: Well, we've got a really really tight plan to make sure that we churn.
Speaker Change: All of these styles properly to take advantage of the opportunity for the company.
Speaker Change: The last question comes from Mark Scheffel from loop capital markets.
Speaker Change: Nathan.
Speaker Change: Hi, Thank you for taking my question most of my questions actually been answered, but I just have one Bob. It's for you I was wondering if you could just speak to.
Speaker Change: The current prospect.
Speaker Change: The company's current dose.
Speaker Change: Perspective on strategic inbound interest.
Speaker Change: That you either seeing or not seeing for the company.
Speaker Change: Yes.
Speaker Change: I think for me.
Speaker Change: The goal has always been and particularly ones that once I became the executive chair.
Speaker Change: Focus on the performance of the business.
Speaker Change: We we.
Speaker Change: We believe that.
Speaker Change: The value of the company is about making the quarters.
Speaker Change: <unk> the product advantage, it's about making sure that we're adding talent to the team.
Speaker Change: <unk>.
Speaker Change: We kind of kind of separated myself a little bit.
Speaker Change: A fair amount from.
Speaker Change: What what the expectations of all of our shareholders.
Speaker Change: And.
Speaker Change: And really zeroed in on the expectation of our shareholders around performance.
Speaker Change: Exchange like we're still in that position here.
Speaker Change: We're operating the business, we've always said that.
Speaker Change: We are open to having conversations and we continue to run the business. So I don't think anything's changed.
Speaker Change: Thank you.
Speaker Change: Yes.
Rick Wadsworth: Our Q&A session I will turn the call over to Rick.
Rick Wadsworth: Vice President of Investor Relations for closing remarks.
Rick Wadsworth: Thanks, operator, and thank you everyone for participating on today's call. We appreciate your questions and your ongoing interest and support of two axes.
Rick Wadsworth: Look forward to speaking with you again, when we report Q1 results.
Rick Wadsworth: Ladies and gentlemen, good day.
Rick Wadsworth: Today's call. Thank you all for joining and you may now disconnect.
Rick Wadsworth: Please wait the conference will begin shortly.
Rick Wadsworth: Sure.
Rick Wadsworth: [music].
Rick Wadsworth: Okay.
Rick Wadsworth: Sure.
Rick Wadsworth: [music].
Rick Wadsworth: Okay.
Rick Wadsworth: Yes.
Rick Wadsworth: Okay.
Rick Wadsworth: <unk>.
Rick Wadsworth: Yes.
Rick Wadsworth: Sure.
Rick Wadsworth: Okay.
Rick Wadsworth: [music].
Rick Wadsworth: Thanks.
Rick Wadsworth: [music].