Asure Software Inc

Good afternoon and welcome to Assure's second quarter 2026 earnings conference call. Joining us for today's call are Chairman and CEO Pat Goepel, Chief Financial Officer John Pence, and VP of Investor Relations, Patrick McKillop. Following their prepared remarks, there will be a question and answer session for analysts and investors. I would now like to turn the call over to Patrick McKillop for introductory remarks. Please go ahead.

Thank you, operator. Good afternoon, everyone, and thank you for joining us for Assure's second quarter 2026 earnings results call. Following the close of the market, we released our financial results. The earnings release is available on the SEC's website and our investor relations website at investor.assuresoftware.com, where you can also find our investor presentation. During our call today, we will reference non-GAAP financial measures, which we believe to be useful to investors in understanding our business and exclude the impact of certain items. A description and timing of these items along with a reconciliation of non-GAAP measures to their most comparable GAAP measures can be found in our earnings release. Today's call will also contain forward-looking statements that refer to future events and as such involve some risks. We use words such as expects, believes and may to indicate forward-looking statements. and we encourage you to review our filings with the SEC for additional information on factors that could cause actual results to differ materially from our current expectations. I'll hand the call over to Pat in a moment, but I just wanted to take a moment to remind people of some of our upcoming investor relations activities. On August 26th, we will attend the three-part advisors ideas conference in Chicago. On September 10th, we will attend the Lake Street Conference in New York. On September 22nd, we will participate in the 19th Annual Barrington Research Virtual Fall Investment Conference. On November 17th, we will participate in the Craig Hallam Alpha Select Conference in New York. On November 18th, we will attend the Stevens Annual Investment Conference in Nashville, Tennessee, as well as the Roth Conference in New York. On November 19th, we will participate in the, excuse me, seventh annual Needham Virtual Tech Conference. Investor outreach is very important to Assure and would like to thank all of those that assist us in our efforts to connect with investors. Finally, I would like to remind everyone that this call is being recorded and it will be made available for replay via a link available on the investor relations section of our website. With that, I would now like to turn the call over to Pat Goepel, Chairman and CEO.

Pat? Thank you, Patrick, and welcome everyone to Assure's second quarter 2026 earnings results call. I'm joined on this call by our CFO, John Pence, and we will provide a business update for second quarter 2026 results, as well as their updated outlook for the remainder of the year. Our second quarter revenues came in at $37.1 million, representing a growth of 23% compared to second quarter 2025. Our growth was broad-based across our business lines, and our past investments in technology, products, and AI are showing real returns. Our organic growth rate for second quarter 2026 was 5%, compared with 1% in quarter two 2025, An improvement of 400 basis points and down slightly sequentially compared with 7% in quarter one 2026 due to seasonality. We continue to receive positive responses to our platform and we believe we will deliver double digit organic growth as we move through the remainder of 2026 by driving expanded cross sell of our products and go lives of previously booked business on our Enterprise Payroll Tax Management Platform. On the Enterprise Payroll Tax Management Platform, we're pleased to share an important milestone that was recently achieved. As you recall, we signed an agreement with Venture Employer Services, and we are glad to announce that 2 million of their supported employees are now live on our Payroll Tax Management Platform. Our pipeline of opportunities remains robust, and we're excited about the future. However, for competitive and confidentiality reasons, we are limited in our ability to share details. Assure Central continued to progress nicely during the second quarter. We now have a majority of our 30,000 direct clients on the platform as we forecasted on our prior call. We are increasingly well positioned to accelerate cross outs and attach rates through the second half of 2026 and beyond. The number of clients purchasing multiple products increased by 6% versus quarter two of 2025. We remain focused on moving clients from an average of two products per client relationship towards four or more products per client over time. Now, a brief update on AssureWorks, our administrative services outsourcing offering, which allows clients to delegate key payroll and HR compliance processes to assure. The positive trajectory we saw at launch has continued to grow into the second quarter. Our pipeline keeps growing. We've added new clients and the reception across our target buyer types, small hotel chains, restaurants, HVAC companies, among others, remains very strong. These are Main Street businesses that need payroll and HR compliance support but lack the internal resources to manage it themselves. We're training additional sales reps on AssureWorks every day and building out the dedicated team beyond our original pilot group. AssureWorks remains strategically very important. Clients who dot manage payroll and compliance services typically represent up to five times the revenue of a payroll-only client. and importantly, AssureWorks is not a PEO model. We're not taking on co-employment risk. For clients constrained by the cost of rigidity of traditional PEO, we believe AssureWorks is a compelling and flexible alternative. On the Salesforce front, we are working very hard towards our goal of 150 reps by the end of 2026. But this isn't just about headcount. Thank you for joining us. We hired more transactional, small business sales professionals suited to selling point solutions. Now that we're selling the broader platform, and especially with AssureWorks, it's a more consultative, needs-based sale, and we've been disciplined about bringing in sales reps who fit that profile. The good news is those reps are ramping faster than what we've historically seen. Today, our existing to new customer logo split is approximately 53% to 47%, which is an improvement from last quarter. And we're still targeting a 35% new logo, 65% base expansion mix over time. On the M&A front, we did not complete any reseller acquisitions in the second quarter, but we continue to actively evaluate opportunities and I would expect to see us complete a few deals in the second half of 2026. Our new sales bookings for core human capital management payroll grew 14% over quarter two 2025 and our contracted backlog remains at approximately $80 million. We expect to convert approximately 41% of that backlog over the next 12 months. are client-based, primarily small and mid-sized businesses in payroll-intensive, compliance-driven industries remain strong. We continue to conservatively model for our clients to have flat headcount growth in our forecast. We haven't seen any meaningful shifts in sales cycle length or competitive intensity during the second quarter. I also want to take a moment to reiterate our thoughts on AI and what it means for our business. We've discussed this on prior calls, but we feel it's important to remind investors of our view here. Payroll and HR compliance isn't the type of workflow software as a generic AI can replace. We hold money transmitter licenses across the country, interface directly with the IRS, and state and local tax agencies and manage compliance obligations where the margin for error is effectively zero. That regulatory complexity combined with high switching costs and a consumption-based revenue model is what makes Assure a system of record and our expertise with enormous moats. At the same time, we continue to see AI as a meaningful accelerator for us as we're already far along in the AI evolution journey. We witnessed an over 30% increase in platform adoptions with Luna, our AI agent, since the first quarter. And the number of interactions with Luna has increased by approximately 38% versus the first quarter. Additionally, 147,000 voicemail calls have been transcribed and about 196,000 emails have been screened for sentiment analysis, extending our capability to capture sentiment analysis from both voice into email. We continue to replicate the automated Luna-powered model that is generally available for our Canadian tax solution across U.S. payroll, U.S. tax and H.R. compliance. bringing our AI capabilities into the flow of work and from human check to AI verified. The same foundation underpins the SureWorks and continues to sharpen our sales intelligence and our support operations. We remain confident in both the durability of our system of record model and the opportunity AI creates for us going forward. So with that, I'd like to turn the call over to John to discuss our quarter two financial results in more detail and provide an update on our 2026 guidance. John?