AppFolio, Inc.

Thank you for joining us today. Welcome to Atfolio's fourth quarter and fiscal year 2019 financial results conference call. I would now like to turn the call over to Erica Abrams. Thank you.

Thank you, Christine. Good afternoon, ladies and gentlemen. Thank you for joining us today as we report Atfolio's fourth quarter and fiscal year 2019 financial results. I'm joined today by Jason Randall and Edith Kane, of AppFolio to discuss these results. This call is being simultaneously webcast on the investor relations section of our website at www.appfolioinc.com. Before we get started, I would like to call everyone's attention to our safe harbor policy. Please note that certain statements made on this call will be forward-looking statements which are subject to considerable risks and uncertainties. Actual results or performance may be materially different from any results or performance expressed or implied by the forward-looking statements. Forward-looking statements may relate to future plans and financial conditions, results of operations, business forecasts and plans, strategic plans and objectives, and product development plans. Please see our filings with the SEC for greater details about risks and uncertainties. Forward-looking statements are based on assumptions as of today and we assume no obligation to further to update any forward-looking statements after today, even if new information becomes available in the future. With that, I'll turn the call over to Ida. Please go ahead.

Thank you, Erica. And welcome to everyone joining us on the call today for Folio's fourth quarter and fiscal year 2019 financial results. We had a strong fiscal year 2019 with full-year revenue of $256 million, a 35% increase year-over-year. GAAP net income was $36.3 million, or $1.02 per diluted share, compared to $20 million, or $0.56 per diluted share, reported in fiscal 2018. Fiscal year 2019 net income results include a $31.5 million tax benefit, primarily related to the release of a valuation allowance against deferred tax assets. Also included in fiscal year 2019 results are $7.3 million of non-cash charges related to stock-based compensation. For those of you who track non-GAAP results, our Form 10-K was filed today and includes more detailed financial data points that you might find helpful in calculating any relevant non-GAAP results on your own. We ended fiscal year 2019 with 14,385 Real Estate Property Manager customers managing an aggregate of 4.64 million units in their portfolios compared to 13,046 customers and 3.9 million units under management reported one year ago. The year-over-year increase in the average size of net new customer acquired is a result of our continued efforts and success acquiring customers with higher unit counts under management. As a reminder, we define a real estate property manager customer base as the number of customers subscribing to our core solutions. These customers are using AppFolio Property Manager or AppFolio Property Manager Plus to manage and grow their businesses. In the legal vertical, we close the year with 10,971 customers, up from 10,279 one year ago. As of December 31, 2019, our annual dollar-based net expansion was 118% for our property manager customers and 121% for our law firm customers. This compares to 116% and 113% respectively in fiscal year 2018. I encourage you to read our 8-K filing today for more information on how we calculate annual dollar-based net expansion. Turning to our most recent quarter, total revenue for the fourth quarter increased 34% over the same period one year ago to $67.4 million. GAAP net income was $4.4 million, or 12 cents per diluted share, which includes a $4.6 million income tax benefit. Core solutions revenue in the fourth quarter was $23.6 million, a 22% increase year-over-year, primarily due to a 19% increase in property manager units under management and a 10% increase in the number of property manager customers. Fourth quarter value plus services revenue was $36. or excuse me, $39.6 million, a 37% increase year over year. Revenue from each of our value plus services increased year over year. The majority of growth in this area continues to be driven by increased usage of our electronic payments, screening and insurance services by a larger base of property manager customers, as well as a higher number of units under management. Other revenue was $4.1 million in the fourth quarter, primarily related to revenue generated from customer subscriptions for our standalone services we offer, as well as fees associated with our property manager customers upgrading to a new website hosting, as we discussed last quarter. Turning to expenses, total costs and operating expenses for the fourth quarter increased 41% year-over-year, compared to an overall 34% increase in total revenue. The year-over-year increase in costs is primarily related to a 38% growth in headcount to support growth areas that we believe will positively impact long-term shareholder value. These include investments in our Upfolio Property Manager Plus offering that serves larger, more complex real estate property manager customers, and at Folio Investment Management, which serves real estate investment managers. Jason will speak more to our additional investment areas shortly. Moving to our balance sheet, we closed the quarter with approximately $50.8 million in cash, cash equivalents and investment securities and $48.8 million of debt. During the fourth quarter of 2019, we signed new long-term leases for the majority of our existing Santa Barbara campus in connection with the change in ownership of the building. At year end, we have approximately $31 million recorded in assets and $36 million in lease liabilities on our balance sheets related to these leases. For the fiscal year, we generated $38.9 million from operating activities. Our primary uses of cash were $54 million for the acquisition of Dynasty. 21 million dollars in capitalized software development costs and 8.1 million dollars for the purchase of property and equipment in connection with our expanding offices and employee base. We did not initiate any stock repurchases during fiscal year 2019 against our authorized share repurchase program of 100 million dollars. As we look to fiscal 2020, we remain enthusiastic about our business, our investments, and growth drivers over the long term. For full year fiscal 2020, we expect revenue to be in the range of $312 to $320 million, which represents growth in the range of 22 to 25%. We continue to expect our weighted average diluted share count for the year to be approximately 36 million shares. That concludes my prepared remarks. With that, I'll turn the call over to Jason for additional comments.