Q4 2024 LivePerson Inc Earnings Call
John Collins, Jeffrey Rhee, John
Bye...
John Collins, Jeffrey Rhee,
Matt: Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome, welcome to LivePerson's fourth quarter, 2024 earnings conference call. My name is Matt and I'll be your conference operator today. At this time, all participants are in a listen only mode. After the preparatory marks, the management team from LivePerson will conduct a question and answer session and conference participants will give instructions at that time.
Speaker Change: To give everyone the opportunity to participate, please limit yourself to one question and one follow-up question. As a reminder, this conference is being recorded. I'd like to turn the conference over to our host, Mr. Jon Perachio, Vice President of Investors Relations. Thank you, John . You may begin.
Speaker Change: Thank you, Matt. Joining me on today's call is Jon Sabino, CEO , and Jon Collins, CFO and COO.
Speaker Change: Please note that during today's call we will make four looking statements which are predictions, projections, and other statements about future results. These statements are based on our current expectations and assumptions as of today, March 5, 2025, and are subject to risk and uncertainties.
Speaker Change: Actual results may differ materially due to various factors, including those described in today's earnings press release and the comments made during this comment call, as well as in 10k things used in other reports we follow the FEC.
We assume no obligation to update any for-looking statements.
Also, during this call, we'll discuss certain non-GAAP financial measures.
Speaker Change: With that, I'll turn the call over to LivePerson CEO , John Sabino.
Speaker Change: Thank you so much, John , and thank you all for joining us today.
Speaker Change: Before diving into our results and strategy, I would like to take a moment to reflect on 2024, provide an update on where we are today, and share our vision for the company's future.
Speaker Change: Near the 14 months ago, I joined LivePerson as its CEO . From the outset, I recognized that this company was built on three fundamental strengths.
Speaker Change: One, we offer a product that delivers real value to our customers and positions us to lead in an AI-driven future.
Speaker Change: to River Robust List, a Fortune 500 customers who value our strategic partnership and three or back by a passionate team of employees committed to unlocking the potential of enterprise digital conversations at scale.
Speaker Change: Celebraging build upon ALP's existing strengths, we implemented a transformation strategy that focused on three core pillars.
Re-invigorating our go-to-market capabilities with customer-centric focus.
Speaker Change: to innovating our product to focus on voice integrations and orchestration while providing flexibility to support a brand's AI vendor of choice and three strengthening our capital structure.
Speaker Change: Throughout 2024, we make significant progress across all three of these pillars.
Speaker Change: Beginning last January and throughout the year, we enhanced our go-to-market capabilities by assembling a new leadership team and implementing best-in-class processes and capabilities. As a result, we've seen notable improvements in retention metrics and win rates.
Speaker Change: We continue to innovate our product by introducing several new AI-driven features to our industry leading enterprise suite. Notable additions include bring your own LLM and co-ply it rewrite, which has significantly accelerated adoption of generative AI on our platform, which I will detail later.
Speaker Change: We also launched our agent workspace for voice, seamlessly integrating voice and digital channels with a bio, with plans to add more voice integrations in the near future.
Speaker Change: This marks a significant advancement in our overarching voice and digital strategy.
Speaker Change: Finally, in May, we executed a transformative agreement with Lin-Roth Lake, significantly enhancing our capital structure and reinforcing our position as a trusted long-term strategic
Speaker Change: While our transformation is still ongoing, I want to commend the entire LivePerson team for their dedication in advancing these efforts, the groundwork laid in 2024 positions as well for sustainable and proper growth in the future.
Speaker Change: Looking ahead, the customer engagement landscape is being redefined, not just by advancements in AI, but by the need for intelligent orchestration that transforms data into real business outcomes.
Speaker Change: Traditional contact center platforms built the static systems of record, specifically log interactions at leaving businesses stuck in a reactive loop.
Speaker Change: These systems were never designed to execute on engagement or actively anticipate customer needs or drive revenue outcomes.
Speaker Change: Notably, Barster has recognized this widening gap, highlighting how legacy platforms are fall short in delivering meaningful customer experiences.
Speaker Change: LivePerson brings something fundamentally different to the table and a purpose-built platform that orchestrates a congeachment execution and delivers measurable business outcomes at scale.
Speaker Change: Unlike legacy systems that store and process data and static workflows.
Speaker Change: Our platform operates on top of real-time interactions using AI to turn every engagement into an opportunity for efficiency, satisfaction, and revenue growth.
Speaker Change: To succeed in today's dynamic environment, brands must embrace AI-driven solutions that seamlessly integrate digital and voice interactions, drive automation, and deliver measurable business outcomes.
LivePerson: For decades, LivePerson has been pioneering at the prize digital customer experiences for the world's largest brands, powering over 10 billion AI driven conversations annually.
LivePerson: Our platform integrates with more than 200 applications while ensuring enterprise-grade compliance, including HIPAA, which has helped us gain share in the healthcare sector, serving some of the world's largest healthcare companies.
LivePerson: Furthermore, a rapid integration of large language models has allowed us to develop competitive products that improve upon existing foundations in customer care, sales, and commerce.
LivePerson: We continue to innovate a comprehensive suite of new bot automations, live agents and analytics capabilities that position live person as a leader in this space.
LivePerson: Our AI has already proven its impact with enterprise customers driving up to 60% in cost savings, losing CSAT scores by more than 20% and enabling agents to handle three times more concurrent conversations with our AI power and co-pilot and automation.
LivePerson: Our vision for 2025 and beyond is to create a future where brands can engage and inspire their customers with every interaction.
LivePerson: We will achieve this by providing enterprises with open, flexible AI powered workspaces that seamlessly integrate our digital capabilities, eliminating the need for costly, disruptive system overhalls.
LivePerson: embedding AI into every interaction to leverage our leadership and automation, real-time transcription and agent assist tools, and by shifting customer engagement from reactive to proactive by integrating AI automation at every stage of the customer journey by leveraging generative AI-powered insights, predictive analytics, and AI-driven knowledge recommendations.
Speaker Change: As John Collins will outline in our 2025 guidance, there is still work to be done in stabilizing our base in reigniting growth. However, we are confident that the groundwork laid in 2024 aligns with our vision for the future, positions live person for sustainable, profitable growth.
LivePerson: Now let me discuss our high-level fourth quarter and full-year results [inaudible]
LivePerson: Revenue in the fourth quarter of $73.2 million, an adjusted EBITDA of $8.1 million, will both above the high end of our guidance ranges.
LivePerson: Revenue for the full year of 312.5 million and adjusted EBITDA of 24.1 million were also both above the high end of our guidance ranges.
LivePerson: John Collins will provide more detail about our financial shortly, but I want to emphasize that we are continuing to deliver on our financial guidance.
LivePerson: I also want to highlight two factors, key to our strategy, that are driving these better than expected results.
First is our glitch generator they are [inaudible]
LivePerson: Enterprise brands are looking for speed, security, and agility as they bring AI into their operations.
We directly address all three needs.
LivePerson: Our solution aligns enterprise-grade security and brand-of-find AI guardrails with the flexibility to integrate numerous LLMs from multiple vendors and third-party services like Amazon
LivePerson: This allows customers to blend and adapt models as their business needs evolve.
LivePerson: Finally, we provide robust tuning and training services that drive increased value for brands from their technology investments in gender and they are.
LivePerson: The second factor key to our strategy is the growing demand for systems of action and intelligence over legacy systems and records.
LivePerson: Let me take a moment to explain what we mean by system of action and intelligence, why this shift is so critical for brands looking to drive our lives and their technology investments.
LivePerson: Customer engagements are moving beyond passive data collection and now need to deliver real-time outcomes of an experience.
LivePerson: Traditional systems of record, store and organize customer interactions, but lack the ability to actively shape and improve customer engagement in the moment.
LivePerson: Systems of Action and Intelligence, on the other hand, intelligently orchestrate customer interactions by leveraging AI, automation, data, and real-time insights to create personalized similar solutions for each customer interaction.
LivePerson: LivePerson is uniquely positioned to meet this demand. The shift away from static systems of record has driven recent wins in the market for a live person.
LivePerson: By orchestrating the right interaction at the right time, we not only improve operational efficiency, but also unlock revenue generating opportunities and foster deeper customer engagement.
LivePerson: We expect these trends to continue and I look forward to updating you on further developments in future quarters.
LivePerson: Now I would like to provide additional detail on the progress in our product and go to market areas.
LivePerson: First, let's discuss our products capabilities launched in 2024 before diving into our initiatives for 2025.
LivePerson: In the first app of 2024, we introduced several new AI innovations designed to deliver better customer experience and increase operational efficiency.
please include
LivePerson: Bring Your Own LLM, which allows brands to integrate their own large language models, so-pilot rewrite, which refines agent messages for clarity and professionalism.
LivePerson: Routing AI agent, a tool that efficiently routes customers needs to the appropriate resource and data collection AI agent, which makes data collection more efficient after an automated.
LivePerson: In the back half of the year, as part of our voice and digital strategy, we launched our agent workspace for voice, integrating third-party voice providers into LivePerson's best-in-class digital agent workspace.
LivePerson: This enables brands to now extend our suite of AI capabilities to their voice conversations, including all about automation, analytics, and conversational intelligence.
LivePerson: In addition to our voice integrations, we continue to see generative AI usage increase. In Q4, we saw a 70% sequential increase in the number of customers leveraging our generative AI.
LivePerson: at a 37% sequential increase in conversations using our GNI suite. This is providing real benefits to real customers.
LivePerson: The examples I would like to share with you are one of the nation's leading health systems with over 80,000 employees launched an internal AI agent to support its employees on THR topics such as benefit policies.
LivePerson: Within weeks, the Generative AI Solutions successfully handled and resolved 55% of the requests
It is now continuously learning and improving every day.
Speaker Change: Lexus, a leading luxury automobile brand offers a unified concierge service built on a network of LivePerson AI agents for routing, knowledge, customer engagement, and scheduling.
Speaker Change: Finds can compare vehicles, book test drives and explore financing on their own time and terms. With seamless hand-off, the brand representers when the timing is right.
Speaker Change: The LivePerson solution has resulted in a 10-X increase in test drive engagements compared to the company's former chatbot experience.
Speaker Change: In addition to prior examples that we shared with Signet, we've recently worked with another globally renowned luxury re-dueler that noticed missed revenue opportunities during off hours.
Speaker Change: To address this, we implemented our generative AI to engage with customers from live agents who are offline, leading to higher quality leads, increased average order values, and improved conversation rates.
Speaker Change: LivePerson's innovation going forward will be focused on driving continued option of our agent workspace for voice and evolving to become a system of action and intelligence to advancements in generative AI capabilities, voice integration, analytics, and unified
Speaker Change: In the first half of 2025, we'll take our second step in our voice and digital strategy, building on the success of the ABIAP Partnership and launching integrations with Cisco and Amazon Connect.
Speaker Change: Our product team will also focus on driving the adoption of our open platform capabilities and enhancing integrations with voice providers and commerce platforms and enabling enterprise customers to maximize the benefits of bringing your own LLM.
Speaker Change: Finally, I want to be clear that investing in our technical infrastructure and commercial capabilities remains a priority for 2025.
Speaker Change: We're making this decision because we're seeing continued demand for our product and potential expansion with our current customer base.
Speaker Change: While this will impact profitability in 2025, we believe this is the right decision for long-term success for LivePerson, our shareholders and our customers.
Speaker Change: I would like to now provide a brief update on our go-to-market progress.
Speaker Change: A year ago, we faced significant challenges, including limited visibility into our customers' decision making, leading to higher than expected churn throughout the year.
In response, we sit out to transform our go-to-market motion to transform our go-to-market motion.
Speaker Change: We installed a new leadership team, we've refined our operational processes, engaged with partners and launched a new simplified pricing model.
Speaker Change: Today, we have visibility into our customers adoption trends, several quarters in advance, allowing us to proactively tailor engagement and plan the maximizes value realization.
Speaker Change: Additionally, we refined our sales strategy to focus on expanding strategic partnerships.
Speaker Change: In Q4, we're already starting to see an uplift in partner contribution as a percentage of total bookings.
Speaker Change: These include several of our largest deals in the quarter, and while it's early, we are on track to reach 35% partner attached for 2025.
Speaker Change: We're also seeing strong momentum in our bonds silver and gold pricing and packaging strategy. In Q4, we experienced a substantial sequential increase in closed deals under our new pricing structure, with feel volume more than doubling and annual reoccurring revenue increasing by five times.
Speaker Change: Notably, a leading automotive finance company upgraded to our gold package, resulting in a seven-figure renewal.
Speaker Change: These results have reinforced our strategy and we expect both deal volume and deal values to continue to increase throughout 2025.
Speaker Change: Change is like these take time to fully realize their impact and while the desired results for our go-to-market transformation are still materializing, I remain confident about the trajectory.
Speaker Change: The continued positive trends sequential bookings in Q1 through Q4 coupled with AI adoption expanding across enterprise customers positions as well to sustain growth in the second half of the year.
Speaker Change: to conclude I want to emphasize that we have exceeded the financial expectations set for Q4 and for the full year. This past year was pivotal for LivePerson and laying the foundation for future growth.
Speaker Change: To ensure we continue to deliver on future financial expectations, we plan to do three things.
Speaker Change: continue driving our commercial performance and bookings and retention continue to control costs and improve our capital structure.
Speaker Change: and continue to innovate our product, particularly by enhancing our robust suite of AI capabilities, leading to strong adoption of enterprise-generated AI while continuing to invest in our technical
Speaker Change: As I outlined, throughout my prepared remarks, Strategic Clarenal Uplaid in 2024 has positioned us for sustainable and profitable growth in the future.
Speaker Change: While it is still early, we are beginning to see gradual improvements reflected in the gradual increases in bookings and renewals.
Speaker Change: However, as noted on our third quarter call, we anticipate levels of attrition to remain elevated for the first half of the year.
Speaker Change: as we move past the renewal cycle impact of our legacy issues in the business.
Once we are through the end of Legacy Manual Cycle,
Speaker Change: with the Solid Foundation that we've established. I am confident we will experience positive net new ARR in the second half of the year. Now, let me hand over our call to John Collins.
John Collins: Thanks, John . I'll begin with a brief update on customer wins followed by a discussion of our financial performance and guidance.
John Collins: In terms of deals and significant customer wins, the fourth quarter marked our third consecutive quarter of improvement. We signed its total 39 deals including 9 new logos and 30 expansions
John Collins: Translating to a quarter-over-quarter increase in total-deal value of 18%.
John Collins: In addition, deal values for new logos for more than double the average over the first three quarters of 2024, which we view as another important indicator of improving commercial execution and market demand for our products.
John Collins: Broadly, there were three dominant themes in the fourth quarter that influenced our results. First, as Jon mentioned, increasing demand for AI agents and AI orchestration.
John Collins: Second, continuing traction within highly regulated industries including healthcare, financial services and telecommunications which collectively represented 80% of bookings in the quarter.
John Collins: Third, Building Momentum with Commercial Partners, which put us on track to achieve our partner-led bookings rules in 2025.
John Collins: Incident with this thematic U, significant renewals and expansions included a US-based financial services company, a leading British broadcast and telecommunications company, a British retail bank, significant new logo ones included a deal with a large multinational consulting company to deploy our generous AI suite for enterprise customers in the Asia-Pacific region.
John Collins: A deal with a partner in South Africa to support the rollout of digital and automation programs for the region's largest insurer.
John Collins: and a partner lead deal at a leading luxury fashion brand to improve sales performance and consumer marketing programs through insights gained from LivePerson's conversational intelligence suite.
John Collins: As for our fourth quarter financial results, total revenue was 73.2 million above the high end of our guidance range. The improvement above expectations was primarily driven by favorable timing of deals in the fourth quarter.
John Collins: I just leave it out for the fourth quarter was above the high end of our guidance range at 8.1 million driven by similar factors contributing to higher revenue and by reductions to our cost structure.
John Collins: Revenue from Hosted Services was 60.29, down 23% year-over-year. Recurring Revenue was 68.69, or 94% of total revenue.
John Collins: Note that, with the divestiture of wild health last year, which was live person's last remaining non-core asset, there is no longer a need to distinguish revenue as B to B or core. All revenue is live person revenue going forward.
John Collins: Further segmenting revenue, professional services revenue was 13 million, down 23% year-to-year. From a geographic perspective, US revenue was 48.4 million, and international revenue was 24.8 million.
or 66% and 34% of total revenue, respectively.
John Collins: I have a revenue for a customer with 625,000, a 2% year of a year driven in part by expansions with our largest customers and in part by customer retention.
John Collins: RPO Declined to $232 million, consistent with the same factor as driving the year-of-year declines in revenue.
John Collins: Net revenue retention was 82% in the fourth quarter, up from 79% in the third quarter [inaudible]
John Collins: The slight sequential increase was driven by revenues from federal timing of deals in the fourth quarter. As a reminder, given that net revenue retention is a function of in-period revenue, we continue to expect sequential declines in this metric through the year.
John Collins: Finally, in terms of cash, we ended the fourth quarter with 183 million of cash and down-sheet, inclusive of the proceeds from the transaction with Linnarok Blake.
Turning to Renew Guides
John Collins: While the positive net ARR we continue to expect in the second half puts us on a path to future revenue growth. The corresponding revenue impact in 2025 represents only a small offset to the larger negative revenue impact in 2025 from customer cancellations last year and this quarter.
John Collins: As a result, and consistent with the expectations we shared last quarter, we expect revenue to decline through most of the year before reaching an inflection point for sequential growth by the end of the year.
John Collins: More specifically for the first quarter, we expect revenues to range from $63.9 to $65.9.
John Collins: which is a sequential decline of approximately 9 million at the midpoint from the fourth quarter. While the primary driver of this sequential decline is the customer cancellations we discussed last quarter, it is worth noting that favorable timing of approximately 3 million from fourth quarter deals was also a significant factor.
John Collins: Normalizing to this time, the sequential decline would have been closer to 6.9
John Collins: In addition, we expect recurring revenue, once again, to be 94% of total revenue in the first quarter.
John Collins: For the full year, we expect revenue to range from $240 million to $255 million, approximately 93% of which we expect to be recovered.
Burning to guidance for the bottom line.
John Collins: For the full year, we expect adjusted EBITAS to range from a 14 million loss to zero or break even.
John Collins: It's all those that we do not accept positive free cash flow in 2025.
John Collins: After careful consideration, we believe our guidance strikes an appropriate balance of many competing considerations.
John Collins: including working capital requirements, the state of the capital structure in related constraints, and the potential for future cash generation achievable only by following through on the investments necessary to execute our return to growth strategy that we've been discussing for the past three quarters.
John Collins: Striking this balance required many difficult decisions, including further reducing our fast structure while planning to approximately double bookings year-to-year.
John Collins: Despite a decline of 65 million in revenue from 2024 to the midpoint of 2025 guidance, I just that EBITDA has expected to decline only 31 million at the midpoint. We offset the other 34 million decline with reductions to our cost structure.
John Collins: In some, we believe LivePerson's customers and investors are better served by the company allocating the resources necessary to deliver positive net ARR in the second half, which depends not only on our commercial team, but also on the technology teams delivering enhanced innovation and platform performance.
John Collins: As for the first quarter, we expect to just eat a bit out to range from a loss of 3-9 to a loss of 1-9
Before taking questions, I'll briefly summarize the two key points.
John Collins: The fourth quarter marked our third consecutive quarter of improving commercial execution.
John Collins: Total deal value was up 18% quarter of a quarter, and new logo deal value was more than double the average over the first three quarters of 2024.
John Collins: We are seeing increasing demand for AI agents and AI orchestration, traction for LivePerson is the leading solution for large enterprises and regulated industries.
and Growing Interest from Partners
John Collins: These are three key themes in influencing our results in validating our strategy.
John Collins: With three consecutive quarters of sequential bookings, growth, and improvement in other key commercial metrics, we expect to see continued improvement in the business in 2025.
And with that, we can move to questions.
John Collins: Great. Thank you. At this time we will be conducting a question and answer session.
John Collins: If you'd like to ask a question, please press star one on your telephone keypad. A confirmation table will indicate your line is in the question queue. You may press star two if you'd like to move yourself from the queue.
John Collins: We're just been using speaker equipment, it may be necessary to pick up your handset before pressing the start keys.
One moment for these local corporations.
Speaker Change: Our first question is from Jeff Henry, from Craig Calum Capital Group. Please go ahead.
Speaker Change: in 25 if I got that right. Are you saying you expect 30% of bookings value to be driven by partners? Just maybe clarify what that term is, so I can understand what that means for 25 and then what was the predecessor number for 24?
Yes.
Speaker Change: Our commenting on where we see line of sight, Jeff, this is John Sabino, I'm sorry, good to hear your voice. Hey, John . Sure. Thank you. 35% is our total target booking value.
Speaker Change: So that's what we're looking at. We're seeing steady improvement from where we were this year. I don't believe we did that number in the past, but we're giving the target of what we're shooting for in 2025.
Speaker Change: Can you give me a magnitude sense of how much of an increase is because I obviously wanted to get some more color on the Cisco Amazon comments and some color on how Avias trending. Yeah, it's definitely more than two acts of what we're seeing.
Speaker Change: now. It's more than that. So, you know, as we've discussed, the partner network was pretty nascent, and we're now starting to see that improve and contribute to the overall performance of the company.
Speaker Change: Yeah, and then maybe just talk to the Avaya, you know, integration and announcement, kind of how that relationship is trending versus expectations and then just thoughts on Cisco and Amazon in terms of timing and go to market there.
Speaker Change: On the VI partnership, we are going in the right direction. We've closed over seven-figure
Speaker Change: We have a number that are in the pipeline as we speak, and we've agreed upon target accounts and markets. We've even seen where we've partnered with Avaya and defeated another C-Cast vendor who was an incumbent from an acquisition.
Speaker Change: So we've been actually with that partnership, we've actually been able to help a via retain customers as well as us.
So that partnership is going in the right direction
Speaker Change: The partnership with Cisco and Amazon Connect is an extension of the overall strategy the company where we believe.
Speaker Change: Voice is an important part of the digital connected customer experience, so having that data to inform.
of customer experience.
Speaker Change: an engagement and personalization as well as driving some of the AI capabilities that we have are continuing for with that strategy. So by expanding with those two other providers, it gives us basically the ability to get to the table and 65% of voice calls that are out there.
Mm-hmm.
Speaker Change: on the SNM incremental spend a couple of questions there. Can you quantify how much incremental spend you're going to be putting into SNM? I think you're addressing.
Hey, John. I'll start it here.
Speaker Change: Broadly speaking, Jeff does not incremental investment relative to 2024 rather as we thought about the reductions in the cost structure that I mentioned in my prepared remarks.
Speaker Change: We left more in SNM, but there was an overall net takeout or reduction in cost. It's just how much we left in relative to other businesses as we thought through the areas where we could afford the reduction and still make our 20-25 plan count possible.
Speaker Change: Got it. Got it. Okay. And then just along those lines and I'll let somebody else jump on just the evolution of the thinking in terms of the debt situation. Obviously you did the the step one transaction with Lin Rock, but you're either goal is to take it out, you know, the existing debt and and sort of deliver through that that path. Any updates, any changes in strategy, any timelines, just any color there would be great. Thanks.
Speaker Change: Hey Jeff, no update to provide at this moment in time, no change to the strategy either. I expect that there'll be developments as we've progressed to the year.
Speaker Change: Okay, great. Thanks for taking the questions. Thanks, Jeff. Great to hear from you.
Speaker Change: Once again, as a reminder, if you'd like to ask a question, it is star one.
Speaker Change: And our next question here is from Michael Latimore from Northland Capital Markets. Please go ahead.
Michael Lattimore: Yes, great. Thank you. The gross margin picked up sequentially to good amount. Is that a sustainable number?
They might, um...
It is largely influenced by-
The Reduction in certain consultants that were assisting us with...
Michael Lattimore: Cloud Migration and General Cloud Operations. In addition to the reduction in liver from our Ganger portfolio, as you know, we continue to reduce the size of that portfolio and specifically the labor component. So with with less labor in the business today, margins have expanded. That said, as we look forward to 2025.
Michael Lattimore: There will be some pressure on gross margin tied to the cloud migration and new cost associated with being on GCP in particular. So I would expect broadly speaking to come down from what was reported in C4.
Okay, got it.
Michael Lattimore: and then I know you're guiding for attrition to continue through mid-year. Like, what percent of your customers or percent of revenue has officially gone through their renewals to go to this client on a percent plot.
Speaker Change: That's a good question, JC, if you have numbers out of more accurate than around about the amount that I could put out there, I'd appreciate you jumping out that first.
Speaker Change: Well, broadly speaking, as we've described of the last few quarters, we expect the current Renewal cycle or the legacy Renewal cycle that John spoke to and is prepared marks to be ending in the first half of...
Speaker Change: The signal or message during the third quarter call will take place in the first quarter of this year. So, the rest of the year should be lighter in terms of customer nutrition and really reach more normalized.
Speaker Change: retention levels that is aligned to our expectation to produce an error in the second half.
Bye.
Speaker Change: And it's a significant course, but the renewal cycle does represent your customer base going through a renewal with you and impact it over a course of 15, 18 months for the renewal cycle.
Speaker Change: You highlighted as one of the values of your product as the customer does not need to do a system overall by that you mean they basically you know keep their time tech center infrastructure in place. Is that what you mean?
Speaker Change: Exactly. What we're seeing is when it's a full-scale, seek-ass replacement, CRM replacement, we are being seen as an extremely attractive option that they can keep some of those components in place and then get best-in-class digital alongside what they're using today. [inaudible]
Yeah, great. Thank you.
Thanks, Michael.
Speaker Change: Once again, as a reminder, if you'd like to ask a question, it is door one.
Speaker Change: If there's no further questions, let me turn the four of that to management for close
We have no additional comments at this time
Speaker Change: Great thank you. This does conclude today's teleconference. You may disconnect your ride to this time. Thank you again for your participation.
Speaker Change: Hi. How are you? I'm good, thanks. You? I'm good, thanks. I'm good. I'm good. I'm good. All right, I'll call you when I'm ready. We'll see you later. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye. Bye.