Amdocs Limited

Ladies and gentlemen, thank you for standing by and welcome to the Q3 2022 AMDOCS earnings. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone. It is now my pleasure to introduce Head of Investor Relations, Matt Smith.

Thank you, operator. Before we begin, I need to call your attention to our disclaimer statement on slide two of the presentation. It notes that some of our comments today may be forward-looking statements and are subject to risks and uncertainties, as described in Amdocs' SEC filings, and that we will discuss certain financial information that is not prepared in accordance with GAAP. For more information regarding our use of non-GAAP financial measures, including reconciliations of these measures, we refer you to today's earnings release, which will also be furnished with the SEC on Form 6-K. Participating on the call with me today are Shuki Sheffer, President and Chief Executive Officer of Amdocs Management Limited, and Tamar Rapaport Digim, Chief Financial and Operating Officer. To support today's earnings call, we are providing a presentation which can be found on the investor relations section of our website, and as always, a copy of today's prepared remarks will be also posted immediately following the conclusion of this call. On today's agenda, Shuki will recap our business and financial achievements for the third quarter fiscal 2022, and we'll update you on the continued progress we have made executing against our strategic growth framework. Shuki will finish by commenting on our financial outlook, after which Tamar will provide additional details on our third quarter financial performance and guidance. As a reminder, our comments today will refer to certain financial metrics on a pro forma basis where applicable to provide you with a sense of the underlying business trends, excluding the financial impact of open markets, which we divested on December 31st, 2020. And with that, I'll turn it over to Shuki. Thanks, Matt.

And good afternoon to everyone joining us on the call today. I'm happy to report a solid third quarter financial performance, reflecting strong demand for our product and services expertise across our core strategic growth pillars of 5G monetization, cloud adoption, digital modernization, and network automation. As you can see from the highlight on slide six, we delivered record revenue of 1.16 billion in Q3, which was at the midpoint of guidance despite unfavorable foreign currency headwind as compared with our assumptions. Adjusting for currency, revenue was up 10.8% year over year. Additionally, we maintained robust sell momentum, which translates to record 12 months backlog of 3.95 billion, up 10% from a year ago, and the fifth consecutive quarter, or roughly double-digit year-over-year growth in this key leading indicator. On the bottom line, we delivered a non-GAAP earning per share of 1.27 cents, which was better than the midpoint of our guidance. Overall, we successfully achieved our financial targets for revenue, profitability, and non-GAAP diluted earnings per share for the quarter. despite volatile foreign currency markets and inflation-related cost pressures, which we successfully navigated with a continued focus on operational access across all aspects of our business. Now, turning to slide seven, let me address the key operating highlights of our Q3 performance. To begin, our global business activity was strong, led by yet another record quarter in North America. While we're closely monitoring the uncertain global macroeconomic environment and potential headwinds, we believe our customers remain committed to their most strategic initiatives, central to which is the innovation of Amdocs is delivering in respect to digital modernization, 5G and fiber rollout, and monetization, the journey to the cloud and network automation. In addition to North America, we continue to view Europe as a strategic low-term growth engine for Amdocs. Adjusting for currency movements, Europe showed signs of second-half acceleration as projects awarded in recent quarters started to ramp up at customer-like PPF Group, 3UK, and various Vodafone Group affiliates. Q3 was also another quarter of robot sales momentum. We strike a relationship with large and long-standing customers like T-Mobile, and AT&T's Cricket Wireless were happy to say that we expanded our managed services engagement for an additional five years, as Tamar will touch on later. Additionally, we further grew our footprint with other major operators, including Vodafone Germany, which has selected Amdox for follow-on digital transformation projects. Consistent operating execution was another Q3 highlight. We successfully deployed many project milestones on behalf of our customers, including the migration of more than 27 million customers as part of a multi-year managed digital transformation project for Excel in Indonesia, which enables them to launch innovative digital services and enhance customer experiences. Additionally, We reach millions of Brazilian subscribers across all cities covered by Telefonica Vivo. In relation to the full BSS quad-plate transformation, we are executing to enable them to combine multiple lines of products in order to deliver more valuable customer interactions. Reflecting our commitment to continuously bring fresh innovation to our customer, we further increase R&D investment on our cloud platforms in Qtree. Additionally, We announced a definitive agreement to acquire MyComOSI for $188 million cash, detail of which are on slide eight. Headquartered in the UK, MyComOSI is expected to expand MDoc's network portfolio to include end-to-end service and network orchestration by bringing key SaaS-based assurance platform capabilities to power the next generation of networks. Service Assurance is a key ingredient in the race to deliver differentiated experiences within 5G. MyComOSI therefore represents a growth move that complements our other recent deals in the network and cloud space, while executing on three of our core strategic pillars, intelligent network automation, 5G, and cloud. MyComOSI is on track to close in the first quarter of fiscal 2023, and we look forward to combining our own expertise with that of the highly talented MyComOSI team to create a unique and broad range of complementary and innovative platforms. Now, let's take a closer look at our recent progress executing against our four-pillar growth strategy of cloud, 5G, digital, and network automation, as shown in slide 9. Beginning with cloud services, we secured multiple new wins with North American customers this quarter. At AT&T's Cricut Wireless, we federally expanded our operation, development, and testing, leveraging our cloud-native technology. T-Mobile USA extends Amdoc's Digital Build Presentment product to its enterprise customers. Our cloud-based service provides a cost-effective solution to have personalized the message to each business customer, boosting engagement and increasing satisfaction, all while driving to an eco-friendly footprint. Additionally, Undock was selected by DISH and AWS to support this 5G Oran rollout. This enables DISH to derive towards a more intelligent, open, virtualized, and fully interoperable mobile and cloud network. In 5G, we recently completed an exciting proof of concept with A1 Telecom Austria Group, during which we showcased the ability of 5G standalone networks to unlock the metaverse and other next-generation Web3 experiences with on-demand connectivity for consumers and enterprises. Moreover, our collaboration with A1 demonstrates the monetization potential of such new revenue streams for telcos by significantly reducing the launch time to market with new and innovative commercial models. Switching to digital, we are excited to announce that Vodafone Germany has shown Amdocs to further accelerate its digital transformation under a new multi-year deal that will harmonize the customer experiences across all touchpoints and improve operating efficiency by consolidating technology across different lines of businesses. This project follows an initial production launch under the large strategic transformation project we won with Vodafone Germany in 2019. In further strength, it deepens Amdoc's existing relationship with this major operator. Additionally, we are happy that Comcast is expanding Amdoc's big presented solution to support its business service customers. Moving to network automation, we expanded our scope of activity with some of the world's largest operations during Q3. As multi-orbit satellite operator, we continue to deliver enhanced form of connectivity. We're excited that SCS selected Amdocs to provide end-to-end service orchestration solution across additional line of business, allowing more SCS customers to benefit from faster turnaround time for orders, reduce handover times, and improve access to the operator's new products, services, and tools. Additionally, America Mobile selected Amdox to deliver its latest policy and charging product in several countries in Latin America. Finally, let me quickly comment on Amdox Media, which recently collaborated with a major UK content provider to launch a new subscription streaming offering that is powered by a cloud-based SaaS MarketOne platform. MarketOne will enable the delivery of personalized, flexible, and seamless access to vast catalog of premium on-demand content for this customer, which is the latest in the growing list of operators that have chosen the flexibility and the scalability of this platform, including Virgin MediaO2, T-Mobile USA, NTT Mexico, Excelcom, and others. Among other AmdocsMedia deals, this quarter Vibidity expanded its multi-year content service agreement with Oi Brazil and signed a multi-year deal with Edison Interactive to provide licensed premium content for the hospitality industry, including major hotel brands, hotel ownership groups, as well as gaming and resort properties. Additionally, Vindicia is collaborating with ACI worldwide to provide subscription-based merchant with turnkey integrated payment solution. Now, turning to a financial outlook on slide 10. As I mentioned before, while we are closely monitoring the uncertain global macroeconomic environment and potential headwinds, we are confident in our unique business model that enables mission-critical product and services aligned with the strategic needs of our customers, highly recurring revenue streams, and long-term customer engagement. More broadly, we believe that connectivity continues to be a cornerstone of society, essential to supporting hybrid environments to work, education, entertainment, and much more. We believe that services provider will still, in the early stages of a multi-year 5G and cloud-driven investment cycle, at the heart of which is Amdocs as a key technology enabler. In fact, As service providers look for new growth opportunities in the 5G area, we believe Amdocs has been better positioned as a highly relevant and trusted partner to help them achieve this goal. Our industry-leading product and services cloud portfolio delivers amazing customer experiences, reduces cost, and improves efficiency, helping service providers around the world to delight their customers and operate more sustainably. Consistent with this view, we continue to see a strong demand environment of rich pipeline of opportunities as supported by the many customer visits and top-level management interaction we have recently seen. Tying everything together on slide 11, we remain well on track to deliver accelerated revenue growth of roughly 10% on a performer constant currency basis for the full fiscal year of 2022. Our visibility to which is underpinned by a record 12-month backlog and a strong year-to-date financial performance. Similarly, we will try to meet our guidance for a four-month non-GAAP diluted earnings per share growth of roughly 10% for the full fiscal year 2022. And with our dividend yield of roughly 2% on top, we are positioned to deliver a double-digit expected total shareholder returns for the second year running. Before handing over to Tamar, let me highlight our new 2021 to 2022 corporate social responsibility in ESG report, which we use as the platform for our first ever ESG webinar for analysts and investor following its publication in June. As you know, we take our responsibility to our customers, their end user, our employees, and the wider community, and of course our investors very seriously. Giving our corporate purpose to enrich lives and progress society with creativity and technology, we focus on delivering sustainable products and derive digital inclusion, which we believe promote diversity and inclusion and improve the well-being of our employees and the people in our communities. Amdocs Media recently provided a great example, where Vibiquity is working with Science Studios to provide a complete end-to-end technology solution for a new streaming platform that exclusively provides premium quality sign language content to the deaf and hard of hearing, representing a worldwide community of over 430 million people. This innovative work includes Ubiquiti's unique creative and technical designing of the platform, the curation of the content, and the innovative personalizing of the user experience. I would like to take this opportunity to acknowledge and thank all of our customers, partners, shareholders, and communities for together working to create a better connected world. I particularly like to call out our global and diverse base of incredibly talented employees and thank them all for their amazing devotion to turning the boldest ideas into reality. With that, let me turn the call to Tamar for her remarks.