Cognyte Software Ltd.

Good day, ladies and gentlemen. Thank you for standing by. Welcome to the Cognize Second Quarter Fiscal Year 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, we will conduct a question-and-answer session. Instructions will be given at that time. Please note that today's conference may be recorded. I would like to hand the conference over to your speaker host, Dean Ridland, Head of Investor Relations. Please go ahead.

Thank you, Operator. Hello, everyone. I'm Dean Ridlon, Cognite's Head of Investor Relations. Thank you for joining us today. I'm here with Elad Sharon, Cognite's CEO, and David Abadi, Cognite's CFO. Before getting started, I would like to mention that accompanying our call today is a presentation. If you'd like to view these slides in real time during the call, please visit the investor section of our website at cognite.com. Click on Upcoming Events, then the webcast link for today's conference call. I would also like to draw your attention to the fact that certain matters discussed on this call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other provisions of the federal securities laws. These forward-looking statements are based on management's current expectations and are not guarantees of future performance. Actual results could differ materially from those expressed in or implied by these forward-looking statements. The forward-looking statements are made as of the date of this call and, except as required by law, Cognite assumes no obligation to update or revise them. Investors are cautioned not to place undue reliance on these forward-looking statements. For a more detailed discussion of how these and other risks and uncertainties could cause Cogmed's actual results to differ materially from those indicated in these forward-looking statements, please see our annual report on Form 20F for the fiscal year ended January 31st, 2024, and other filings we make with the SEC. The financial measures discussed today include non-GAAP measures. We believe investors focus on non-GAAP financial measures in comparing results between periods and among our peer companies that publish similar non-GAAP measures. Please see today's presentation slides, our earnings release, and the investor section of our website at cognite.com for a reconciliation of non-GAAP financial measures to GAAP measures. Non-GAAP financial information should not be considered in isolation from as a substitute for or superior to GAAP financial information, but is included because management believes it provides meaningful information about the financial performance of our business and is useful to investors for informational and comparative purposes. The non-GAAP financial measures that the company uses have limitations and may differ from those used by other companies. Now, I'd like to turn the call over to Alad.

Thank you, Dean. Welcome, everyone, to our second quarter conference call. This was another strong quarter for Cognite. We're delivering on our business plan, executing the whole strategy, and generating improved profitability as we leverage our financial model. We delivered another quarter of double-digit revenue growth, with growth margin and adjusted EBITDA expanding more rapidly than revenue. This year-to-date performance, solid visibility, and healthy demand have given us the confidence to increase our fuller outlook. During Q2, we delivered revenue of $84 million, up approximately 10% year-over-year. Non-GAAP gross profit increased 13% year-over-year, growing faster than revenue, consistent with our focus on margin expansion. We also generated $8 million of positive adjusted EBITDA in the quarter, more than three times the amount that we generated in Q2 last year, and we remain focused on delivering sustainable and profitable growth. A central component of our growth strategy is to deepen and broaden our engagement with existing customers by expanding the use of our solutions and introducing them to additional offerings. Our continued success in this area underscores the significant value we deliver and the strength of our customer relationships. In Q2, we secured three substantial follow-on orders, each valued at over $10 million. These orders came from two national security agencies and a law force agency. Each of these customers has realized significant value for our solutions over the years. We believe our solutions have proven to be indispensable, providing our customers the quality, reliability, and power needed to tackle evolving challenges effectively. In North America, we continue to make progress. During the first half of the fiscal year, we run deals with eight new customers. In each case, the customers replaced an incumbent with a Cognite solution. Many of these new customers were referred to us by existing customers who have experienced the high value and superiority of our technology firsthand. We are encouraged by the progress we are making. I want to shed some light on the evolving world of threats and the intelligence imperative our customers face. The investigation challenges faced by law enforcement and security agencies are becoming increasingly complex over time across various activities such as organized crime, counter-terrorism, drug smuggling, human trafficking, financial crimes, and illegal immigration. The growing challenges stem from the fact that bad actors are continually evolving, adopting more sophisticated tactics, and exploiting the latest technologies to conceal their activities. They leverage encrypted communications, dark web networks, and anonymous payment methods to evade detection while increasing using AI machine learning to mimic legitimate behavior and obscure their operation. This constant adoption makes it significantly harder for security agencies to track their activities, uncover networks, and stop illegal operations before they take place. To empower our customers to stay ahead of these constantly evolving threats, we deliver cutting edge innovation powered by AI and advanced analytics. Our technology equips agencies to detect patterns, relationships, and hidden insights that would otherwise be impossible to uncover. By partnering with and learning from hundreds of agencies worldwide, we continuously incorporate advanced intelligence methodologies, ensuring our broad base of customers has the best tools to remain many steps ahead of bad actors. In an effort to give you a clear understanding of how our solutions are deployed and the impact they deliver, I would like to focus this quarter in human trafficking, which remains a critical challenge for law enforcement agencies globally. We can only imagine the immense suffering of the victims of human trafficking, making it imperative to identify and resolve these cases as quickly as possible. This illegal activity is highly sophisticated and organized, with criminal networks operating across international borders, using complex financial transactions, and communicating in multiple languages. These groups also leverage the latest communication technologies to conceal their identities and evade detection. One of the key challenges law enforcement faces in tackling human trafficking is extracting actual insights from the vast amounts of digital and traditional data sources fast. By deploying the Kugnay platform, law enforcement agencies can uncover digital traces, reveal hidden identities, track financial transactions, and assess intents and risks. Proactive measures driven by decision intelligence not only enable faster resolution, but also help prevent future crimes. Another highlight of this quarter relates to our cyber threat solution, Lumino. Recently, Cognite was recognized for Luminar AI Insights, one of our AI-driven threat intelligence solutions, in an August 2024 Gartner report, Imagine Tech, The Future of Cyber Threat Intelligence Research. In this report, Gartner assesses trends impacting the threat intelligence domain, predicting that Gen AI-based capabilities will become key as this technology will support faster meantime to respond by more quickly providing indicators about threats and the surrounding context. As generative AI technologies advance and reshape cybersecurity, Cognite has integrated these technologies into a Luminar solution and continues to develop even more advanced capabilities, making Luminar one of the only solutions with this cutting-edge offering. In summary, we are making a meaningful difference for our customers empowering them to address significant, growing, and evolving threats. Our mission to make the world a safer place drives everything we do. Our cutting-edge solutions accelerate investigations, enable faster decision-making, and help mitigate a wide range of threats. We are continuing to grow by introducing new, advanced capabilities, deepening our relationships with existing customers, as well as expanding our reach with new ones. These accomplishments are strengthening our ability to deliver sustained profitable growth. With a strong first half of fiscal 25 and solid visibility into our revenue for the upcoming quarters, we are once again raising our full year outlook. We are now expecting revenue to be approximately $347 million, plus or minus 2%, representing about 11% year-over-year growth at the midpoint. Given the leverage in our financial model, we increased our adjusted EBITDA guidance, and we now expect it to be about $25 million at the mean point of the revenue range, almost three times what we generated in fiscal 24. Now let me turn the call over to David to provide more details about our Q2 results and updated fiscal 25 outlook.