eGain Corporation

Good day and welcome to the eGAIN fiscal 2023 fourth quarter and full year financial results conference call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then 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 touch-tone phone. 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 Jim Byers with MKR Investor Relations. Please go ahead.

Thank you, Operator, and good afternoon, everyone. Welcome to eGain's fiscal 2023 fourth quarter and full year financial results conference call. On the call today are eGain's Chief Executive Officer, Ashu Roy, and Chief Financial Officer, Eric Smith. Before we begin, I would like to remind everyone that during this conference call, management will make certain forward-looking statements which convey management's expectations, beliefs, plans, and objectives regarding future financial and operational performance. Forward-looking statements are generally preceded by words such as believe, plan, intend, expect, anticipate, or similar expressions. And forward-looking statements are protected by safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to a wide range of risks and uncertainties that could cause actual results to differ in material respects. Information on various factors that could affect EGAIN's results are detailed in the company's reports filed with the Securities and Exchange Commission. EGAIN is making these statements as of today, September 14, 2023, and assumes no obligation to publicly update or revise any of the forward-looking information in this conference call. In addition to GAAP results, we will also discuss certain non-GAAP financial measures, such as non-GAAP operating income. The tables included with the earnings press release include reconciliation of the historical non-GAAP financial measures to the most directly comparable GAAP financial measures. In addition, the GAINS earnings press release can be found by clicking the press release link on the investor relations page of eGain's website at eGain.com. And along with the earnings release, we will post an updated investor presentation to the investor relations page of eGain's website. And lastly, a phone replay of this conference call will be available for one week. And now with that said, I'd like to turn the call over to eGain's CEO, Ashu Roy. Thank you, Jim.

And hello, everyone. we've had a solid year despite a difficult economic environment through the fiscal year our total revenue for fiscal 2023 grew seven percent year-over-year to 98 million dollars our non-gap net income was 8.4 million dollars or 25 cents per diluted share and we bought back of our own stock while still generating good cash flow from operations for the year of $4.6 million, growing our cash balance to just above $73 million at the end of the fiscal year. Looking at the fourth quarter, both our top and bottom line results were ahead of our guidance and street consensus. We saw good renewals from our existing customers during the quarter. including several big ones, multi-million dollar ARR clients. At the same time, new logo acquisition continued to be challenging in the quarter as decisions continue to get pushed out. Stepping back, as I look at the year, I want to share what I see as market trends and that impacts how we are planning to operate in fiscal 2024. As you all know, in late 2022 calendar, the chat GPT announcement definitely ended up impacting our new logo acquisition plans in an already challenging macroeconomic environment when businesses were retrenching and they were scrutinizing their technology investments. Many of our active enterprise opportunities paused to assess how CapGPT and more broadly generative AI would impact their customer engagement investments going forward. Now, interestingly, over the last couple of months, we are seeing that businesses seem to have mostly run through their initial assessment exercise, and several of them we see are again prioritizing a knowledge hub, which would serve as a reliable and compliance ready source of content or generative AI tools to learn from and contribute to. Specifically, we are now seeing enterprises looking for these modern knowledge of platforms where they can plug and play their generative AI IT that they seem to be working on internally. At the same time, we are seeing some businesses with legacy knowledge systems which cannot take advantage of these generative AI capabilities as well. those businesses seem to be looking to re-platform. And so these two trends, they're sort of resulting in the volume of increased RFP and pilot activity for us, which has ramped up nicely in the last two, two and a half months, essentially this current quarter. What seems to us is that generative AI is elevating the importance of and rejuvenating the demand for knowledge hubs. Businesses are looking to optimize their business experience and drive productivity with AI-powered automation. Customer engagement seems to be a popular reach head to start that. Looking at our clients, we continue to do very well with them. Our client satisfaction levels are at an all-time high. inching up to about 4.8 on a scale of five on the Gartner Peer Reviews website. Our clients are looking to invest more in implementing their knowledge strategies to drive more automation across all customer touchpoints, both agent-assisted as well as self-service. Turning to business outlook for fiscal 2024, We are optimistic about the demand trend. As I mentioned, it's jumped up in the last two and a half months compared to the first half of calendar 2023. We see re-engagement from several opportunities that have stalled in our pipeline, and we see new ones coming in, and I'm talking about Fortune 500 companies here. So we do believe that we will see new global momentum improving in fiscal 2024. However, we believe it's prudent to remain cautious from a planning and forecasting perspective because the macroeconomic environment continues to be somewhat uncertain. Over the past couple of quarters, we have made the necessary adjustments to reflect our caution and align our business operation to an environment where we can still continue to invest in product innovation and customer success, as well as prosecute these sales opportunities effectively, but do it with a view that we are still navigating through what seems like the back half of the market flow. On the sales and marketing front, we are very excited about our upcoming annual customer conference, eGain Solve 23, which we are holding in London. This is on September 25th. Conference registrations are at an all-time high for us for this event, which includes clients, prospects, partners. We'll have clients, many, actually six of them, sharing customer stories and successes and journeys with eGain, their innovation. And we, eGain, will be announcing and demonstrating some new, exciting capabilities at the conference as well. To conclude, based on our recent... improved pipeline activity, we believe that the market for knowledge hubs is working back up. As I mentioned, we are now engaged in more RFPs and pilots, in fact, more than we have ever been in the last 12 months. However, we continue to be cautious and mindful of the broader economic uncertainty. And so, with the operational adjustments in place that we have made, We feel that we can continue to invest in product innovation and customer success while pursuing these enterprise opportunities that have reengaged with us and the new ones that are coming in. Finally, we are super excited about SALT23, and we invite you to join us at this event in London, if you can, on September 25th. With that, I'll ask Eric Smith, our Chief Financial Officer, to add more color around our financial operations.