AvePoint, Inc.

Good afternoon and welcome to the AFPOINT Inc. fourth quarter fiscal year 2023 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Jamie Orestia, Vice President, Investor Relations. Please go ahead.

Thank you, operator. Good afternoon, and welcome to AvePoint's fourth quarter and full year 2023 earnings call. With me on the call this afternoon is Dr. T.J. Jang, Chief Executive Officer, and Jim Cassidy, Chief Financial Officer. After preliminary remarks, we will open the call for a question and answer session. Please note that this call will include forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from management's current expectations. We encourage you to review the safe harbor statements contained in our press release for a more complete description. All material in the webcast is the sole property and copyright of AvePoint with all rights reserved. Please note this presentation describes certain non-GAAP measures, including non-GAAP operating income and non-GAAP operating margin, which are not measures prepared in accordance with U.S. GAAP. The non-GAAP measures are presented in this presentation as we believe they provide investors with a means of understanding how management evaluates the company's operating performance. These non-GAAP measures should not be considered in isolation from as substitutes for or superior to financial measures prepared in accordance with U.S. GAAP. Reconciliation of these measures to the most directly comparable GAAP financial measures is available in our fourth quarter and full year 2023 earnings press release as well as our updated investor presentation and financial tables, all of which are available on our investor relations website. With that, let me turn the call over to TJ.

Thank you, Jamie, and thank you to everyone joining us on the call today. Our fourth quarter was an outstanding close to our strongest year yet as a public company, as we meaningfully outperformed our guidance for all metrics, total ARR, total revenues, and non-GAAP operating margins. Once again, our results were driven by the strength of our platform offering and the customer demand to establish a solid data foundation, in turn allowing our customers to manage and protect critical data, reduce costs, improve productivity, and make more informed business decisions. Jim will spend more time on our Q4 results and our initial expectations for 2024, but I would like to spend today on three main topics. First, What we're seeing as the world moves from talking about AI to beginning to apply it at scale. Second, some key customer wins that demonstrate how we are enabling organizations to prepare and fully harness AI to advance their digital workplace. And lastly, several steps we're taking at AppPoint to invest in future innovation. Let's start with AI. AI is not a fad. It is a powerful force that is transforming every industry and every aspect of our lives. Recent research finds that 80% of companies will incorporate generative AI into their businesses by 2026. And it has the potential to collectively add $4.4 trillion to the global economy. And by 2027, sales of generative AI software and services will climb 35% and 42% respectively. Simply put, this is a tremendous market opportunity, and AppPoint will be a key player in driving general AI adoption across a wide range of businesses in the years to come. What gives us this confidence? There's a catch to all the excitement around AI. AI is only as good as the data that feeds it, and data is inherently messy, complex, and risky. Data needs to be managed, governed, and secured. In short, data needs to be ready for AI. To build AI that truly understands your business, you need a data foundation that maps every workspace, piece of content, and user to the right business context. The emerging AI solutions baked into tools organizations use to work every day, such as Copilot for Microsoft 365, are generating a lot of buzz based on how they can improve productivity. But what we're also hearing from our customers and channel partners is that first and foremost, they must have the proper information management, data security, and optimized data governance functions necessary to take full advantage of any AI-driven solution. The AppPoint Confidence Platform does just that. It transforms chaos into order, enriches your enterprise data with context around ownership, risk postures, and relevance. With this data foundation, our AI insights engine, which supports the entire confidence platform, comes alive. Learning your business needs, refining models tailored to you, and improving decision making for end users. In short, we can power new AI experiences for customers. Example of this in market today are products like AppPoint Opus, AppPoint Empower, and AppPoint MyHub which offer comprehensive information management to ensure compliance, optimize cloud storage, streamline data management processes, and improve employee experience, all of which are essential to the AI ambitions of our customers, partners, and prospects. For example, AppPoint Opus is available with an AI smart classification system to automatically classify and tag documents based on their content, metadata, and context. and applies the appropriate policies and actions to them. This reduces the manual effort and human error involved in data governance, enables organizations to prevent data breaches, reduce storage costs, and enhance data quality and usability. While the AI opportunity remains in early stages, we're excited by what we're seeing. and would like to share a few customer wins in Q4 that demonstrate how we help organizations prepare their data foundation to harness the potential of AI into their operations. In Q4, we won the business of a large insurance group in France with over 30,000 employees, which is in the midst of moving to the cloud to modernize productivity and collaboration. With our secure cloud backup solution, the insurance group can safeguard their sensitive data across multiple environments, including Microsoft 365, EntraID, Power Platform, Azure, and AWS virtual machines. The customer choose our solution over competitors because our ability to support cyber resiliency for all these environments and our flexibility to support future additions such as Power BI and Salesforce. With that point, this organization can now ensure the security and availability of their data and applications while also complying with regulations and standards as they modernize their digital workplace. Once organizations establish a data resilience strategy, a natural next step is to implement a data governance framework that secures their operations while not impeding collaboration. In Q4, We expanded our relationship with a global healthcare company with more than 100,000 users. Already a customer of our secure cloud backup solution, they purchased our policies product to implement more control and visibility over their fast growing cloud resources, permissions, and workspaces. As the customer continues to modernize its productivity environment, they also purchased our solution for migrating legacy content from Box, Dropbox, self-hosted SharePoint, and other Microsoft 365 tenants so they can leverage our AI insights engine to improve their data quality as they consolidate their content into one centralized secure location. I discussed AppWin Opus a moment ago, and we are pleased to see the initial attraction from this new product with both existing and new customers. One of our existing customers, a leading global automotive manufacturer, with 80,000 users wanting to implement a robust information management strategy to secure, govern, and manage their data across Microsoft 365. They choose AppPoint Opus to apply consistent and automated information lifecycle policies to classify, retain, archive, and dispose of their data according to their business and compliance needs. They also leverage the AI-powered analytics and insights provided by AppPoint Opus to better understand how data is being used by the organization and how to reduce data breach risk. The other benefit of AI-ready information management strategy is managing the rising costs of data storage, which was the case with a global communications firm with 900 terabytes of data. AppPoint Opus rapidly identified crucial data sprawl and storage optimization challenges discovering thousands of unowned and unused teams and workspaces, leading to high storage costs. The customer choose AppPoint Opus to quickly and intelligently archive 80% of its contents, which will save $2 million over the next three years. In addition to these savings, our platform will also enhance their data governance and compliance posture. As we meet this transformative moment in our industry, We're evolving our organizations and making strategic investments to drive faster innovation so we can continue delivering on our promise to advance the digital workplace, capturing growing markets, and prioritize profitability. First, within AppPoint, we see the need to create a program that will accelerate our AI consumption, introduce automation to enhance our business, and ensure we remain innovative and competitive. That's why in the fourth quarter, we launched AppPoint AI, our new program that is integrating AI across all aspects of our company, from our products and services for our customers to our own businesses and operations. In addition, this program will include the opening of an AI industry lab in partnership with Economic Development Board of Singapore and other institutes of higher learning. We have a framework for rapidly incorporating and fine-tuning AI innovations and a path forward to apply AI to emerging trends we see in the space. We look forward to sharing our progress in the coming quarters. Second, we recognize the importance of pursuing inorganic opportunities to expand our market presence and stay on the cutting edge of technology. We're excited to announce that we'll be anchoring a new growth equity fund, A3 Ventures, that will invest in B2B software companies that are ready for the global stage. including those focused on accelerating generative AI for the digital workplace around the globe. In addition to creating a thriving ecosystem for Apple and cloud customers and partners, our prominent role will provide line of sight to attractive assets, enhance our engagements with our channel network, expand our influence with strategic partners, and increase our total addressable market. We look forward to sharing more information on A3 Ventures as the fund launches in the coming months. In closing, we're well positioned to help companies adapt and compete in today's dynamic business and technology landscape. As the value provided by the Appoint Confidence Platform is critical to the success of the AI ambitions of companies around the world. With that, let me turn the call over to Jim.