eGain Corporation

Good afternoon, everyone, and welcome to the eGain Fiscal 2024 Third Quarter Conference Call. All participants will be in a 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 and then one on a touch-tone telephone. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. It's time I'd like to turn the floor over to Jim Byers from MKR Investor Relations. Sir, please go ahead.

Thank you, Operator, and good afternoon, everyone. Welcome to EGAIN's Fiscal 2024 Third Quarter 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 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, May 9, 2024, 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. eGain's earnings press release can be found by clicking the press release's link on the investor relations page of eGain's website at eGain.com. And along with the earnings release, we'll post an updated investor presentation to the investor relations page of eGains 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 eGains CEO, Ashu Roy.

Thank you, Jim. And good afternoon, everyone. We saw good momentum in new logo wins and business activity in the quarter, driven by our AI knowledge offering. A McKinsey report from last year talked about the potential of generative AI to revolutionize customer operations function across the economy and talked about improving customer experience and agent productivity using generative AI through digital self-service and enhancing agent skills. And it said that there was a potential to deliver $400 billion in savings annually for businesses who today collectively spend $1.5 trillion a year in customer service. I say this because with our latest AI knowledge offering, which is eGain Assist GPT, we are breaking down the technology barrier that prevented companies from delivering trusted answers for customer service at scale. That barrier was the manual effort in creating and curating knowledge within a hub that could serve as a single source of truth. As companies are looking to significantly reduce customer service costs, our comprehensive solution delivers on the promise of AI, for them to reduce cost of customer service while boosting their customer experience. These are exciting times for us, right? So looking at our business, we signed some new good knowledge customers in Q3. I'll mention a few. First one is the U.S. Mega Bank, so one of the big four. We are starting with them in one of their fast-growing multi-billion dollar divisions. They're looking to contain their costs as they're grappling with customer and agent experience in a rapidly growing service group. Right following that, we have more opportunities with this client in our pipeline, and we are looking forward to becoming the platform for AI knowledge across the bank. It's really exciting for us. A mega bank, something that we have been working with them for a couple of years now. And I'll talk to that opportunity a little more later on. The next one I want to bring out is a Fortune 100 mortgage financing enterprise in the U.S. We're starting out with them by replacing an existing solution for conversational service for one of their business units. Over time, the intent is to enable an enterprise-wide capability that is contextual and compliant, available both to customers and employees. The next one I want to mention is a fast-growing U.S.-based property management company. They see AI knowledge as a core capability to improve customer experience and empower their employees as they are driving growth in a billion-dollar business. And the next one, and the last one I want to mention, is a leading manufacturer of high-end bicycles and related products. They're replacing their current knowledge platform with eCane to deliver trusted answers to customers and agents. Looking at the market, our business activity in this market continues to improve, and it improved in the quarter as well. In fact, over the last nine months of fiscal 24, Our new logo and RFP counts, both of them, grew by 50 percent year-over-year. This reflects the growing interest we are seeing in knowledge management as a foundation for effective AI use in customer service. Now, the mega bank I talked about that we won in the quarter is a case in point. For the past year and a half, They've been running multiple AI initiatives within their business, no surprise. And having run through their exploration and evaluation of AI in their context, they concluded that they needed a knowledge foundation to feed trusted content to their AI tools. In their case, as for most large enterprises, they like our composable architecture so they can plug in their LLMs whenever they are ready for prime time. Most of the new opportunities we are engaging with share this growing awareness of the complementarity of AI and knowledge to deliver trusted answers for customer service. As we all know, customer service is a business function where 80% answer accuracy is not good enough. With a wrong or thoughtless answer delivered by uncontrolled AI tapping directly into uncurated content would easily result in a lawsuit worse yet, sustained brand compromise, a la Air Canada recently. Extending our product leadership in the AI knowledge market for customer service, we rolled out our assist GPT solution in Q3 to help our clients automate knowledge creation and curation. In fact, earlier today on our well-intended marketing webinar, A European client of ours joined us to share their success story and lessons learned as we helped them slash their knowledge build effort by a factor of five and reduced at the same time the answer errors by improving quality by 6x using our solution. Our current market position gives us a unique vantage point in the AI knowledge innovation race. And so we are taking full advantage of it to enrich our products faster and better, to orchestrate AI and experts to automate knowledge management, thereby driving down the cost of customer service with trusted answers. To conclude, we see continued momentum in new logo wins and supporting pipeline activity. And as such, we are... investing in R&D and marketing to capitalize on this disruptive opportunity. At the same time, we're keeping a keen eye on costs and making sure that we're putting all our wood behind this arrow to dominate the AI knowledge market for customer service. With that, I'll ask Eric Schmidt, our Chief Financial Officer, to add more color around the financial operations. Eric?