Alarm.com Holdings, Inc.

Good day and thank you for standing by. Welcome to the Alarm.com Q2 2023 earnings conference call. At this time, all participants are on a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that this conference is being recorded. I would now like to hand the conference over to your speaker today, Matt Zartman. Please go ahead.

Good afternoon, everyone, and welcome to Alarm.com's second quarter 2023 earnings conference call. Please know that this call is being recorded. Joining us today from Alarm.com are Steve Trundle, our CEO, and Steve Valenzuela, our CFO. During today's call, we will be making forward-looking statements, which are predictions, projections, estimates, or other statements about future events. These statements are based on current expectations and assumptions that are subject to risk and uncertainties that may cause actual results to differ materially from our current expectations. We refer you to the risk factors discussed in our quarterly report on Form 10-Q and Form 8-K, which will be filed shortly after this call with the SEC along with the associated press release. This call is subject to these risk factors, and we encourage you to review these risk factors. Alarm.com assumes no obligation to update any forward-looking statements or information which speak as of their respective dates. In addition, several non-GAAP financial measures will be discussed on the call. A reconciliation of the GAAP and non-GAAP measures can be found in today's press release on our Investor Relations website. I'll now turn the call over to Steve Trundle. You may begin.

Thank you, Matt. Good afternoon and welcome to everyone. We're pleased to report that our second quarter results exceeded our expectations. SAS and license revenue in the second quarter was $140.4 million, resulting in a non-GAAP growth rate of 13.3% over last year, excluding by then. Our adjusted EBITDA in the second quarter was $36.4 million. I want to thank our service provider partners and the Alarm.com team for their contributions to our results and for their ongoing performance. Our increasingly diverse business continued to grow despite uncertain macro conditions. Our SaaS outperformance was driven by our growing subscriber base and increasing contributions from our growth initiatives. Hardware outperformance was driven by sequential growth in the volume of camera cells consistent with solid account creation during the quarter and normalized channel inventory levels. Our stronger than expected adjusted EBITDA line was driven by an increased focus on controlling cost, along with the higher performance in SAS and hardware revenues. In terms of our operations, we continue to focus on our growth strategies as we exploit the opportunities we see in commercial, international, video, and our venture businesses. Collectively, SAS revenue from these initiatives is growing faster than our total SAS at about 25% on a trailing 12-month basis. We're carrying nice momentum into the back half of the year, and I believe we are well positioned to execute our annual plan. On today's call, I want to provide a few product updates around our video services platform and the development of our commercial business. I'll begin with the video services platform. In the second quarter, we introduced a new video doorbell called the VDB 750. Now with three alarm.com developed products in the market, our video doorbell lineup offers our service providers unmatched choice, flexibility, and performance options. This should allow us to drive up the attachment rate of our video doorbells through time. We believe the 750 is the first battery-free video doorbell on the market. As you may know, even wire-powered video doorbells still embed and require a small battery that must be replaced periodically. With no consumable parts, the 750 is the lowest maintenance video doorbell product that service providers can install. Embedded batteries also restrict the typical video doorbell operating temperature range. The new 750 has an operating temperature range that is as much as 70 degrees Fahrenheit wider than other leading video doorbell brands. That's particularly important to our service providers in both the far north and the southwest. The 750 became generally available in the second quarter, and we expect it to be adopted quickly as our service providers integrate it into their offerings. Our investments in video software and cameras are consistent with the opportunity we are seeing. In the last two years, we've seen a double-digit growth rate in the number of Alarm.com video cameras that our service providers install monthly. Adding our video solution to a subscriber's account contributes to higher ARPU and supports an 8 to 10-year SAS revenue stream. I'll now shift to discuss a significant enhancement we have made to our partner services platform so that our service providers can better manage their commercial customer accounts. As a reminder, our partner services platform is a broad suite of remote management software, resources, and business intelligence solutions. We designed these capabilities to help our partners operate more efficiently while deploying more devices and services to their customers. We put a lot of effort into wrapping our consumer-facing technology with backend services and software that enable service providers to be successful with their broad deployment of our products. This quarter, we expanded the business intelligence component of our partner services platform to provide new insights into commercial account performance. Our data science team was able to model historical account characteristics and identify discrete attributes that are closely associated with lower customer attrition and greater everyday system engagement. These insights were then rolled into a set of six specific best practices. Our service providers can implement these practices to increase customer lifetime value from their high ARCU commercial accounts. They can also monitor implementation in their commercial account base and identify opportunities for additional improvements using our business intelligence reporting engine. In summary, I'm pleased with our second quarter results and our execution of our plan through the first half of 2023. We continue to expand our platform and market opportunity with the launch of innovative new products and the occasional acquisition that aligns with our long-term growth strategy. I want to thank our service provider partners and our team for their hard work and our investors for their continued trust in our business. And with that, let me turn things over to Steve Valenzuela to review our financial results and provide guidance. Steve?