Five9, Inc.

Thank you for joining us today. On the call are Mike Berkland, Chairman and CEO, Dan Berkland, President, and Barry Zworenstein, CFO. Certain statements made during the course of this conference call that are not historical facts, including those regarding the future financial performance of the company, expected ARR from certain customers, customer growth, anticipated customer benefits, company growth, the anticipated benefits from our recent acquisition of ACS, enhancements to and development of our solution, market size and trends, our expectations regarding macroeconomic conditions, company market position initiatives and expectations, technology and product initiatives, and other future events are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are simply predictions, should not be unduly relied upon by investors, Actual events or results may differ materially, and the company undertakes no obligation to update the information in such statements. These statements are subject to substantial risks and uncertainties that can adversely affect 5 future results and cause these forward looking statements to be inaccurate, including the impact of adverse economic conditions, including macroeconomic deterioration and uncertainty, including increased inflation, increased interest rates, Supply chain disruptions, decreased economic output and fluctuations in currency exchange rates, lower growth rates within our install base of customers, achieved the intended benefits from the acquisition of ACS and the other risks discussed under the caption risk factors and elsewhere in 5.9's annual and quarterly reports filed with the Securities and Exchange Commission. In addition, management will make reference to non-GAAP financial measures during this call. A discussion of why we use non-GAAP financial measures and information regarding reconciliation of our GAAP versus non-GAAP results and guidance is currently available in our press release issued earlier this afternoon, as well as in the appendix of our investor deck and in the investor relations section on Five9's website at investors.five9.com. Lastly, a reminder that, unless otherwise indicated, financial figures discussed are non-GAAP. And now, I'd like to turn the call over to Five9's Chairman and CEO, Mike Birkland.

Thanks Emily, and thanks everyone for joining our call this afternoon. I'm pleased to report strong third quarter results with revenue growth of 16% year-over-year, primarily driven by our LTM Enterprise subscription revenue growing 28% year-over-year. Adjusted EBITDA margin for the third quarter was 18% of revenue, helping drive an all-time record for operating cash flow of $37 million or 16% of revenue. Let me start off by reminding you of the three continuing trends that drive our confidence in this market. First, enterprises are developing plans at a greater sense of urgency to replace their on-premise contact center solutions as legacy vendors have retrenched and slowed or even stopped development in some cases. Also, a reminder that in terms of cloud replacing on-premise, we believe that the penetration is still less than 20%. Second, companies are enthusiastically pursuing digital transformation initiatives to enhance customer experience, cut costs, and increase revenue. In this context, remember that contact centers are mission-critical systems, which are a source of brand loyalty and differentiation. And third, AI is becoming an even more important catalyst for enterprises to shift to the cloud. AI and automation is clearly an area of focus for enterprises, as demonstrated by our greater than 80% attach rate on $1 million-plus ARR deals in the quarter. Now I'd like to discuss the three main growth drivers for our business, namely our platform, our march-up market, and our international expansion. Let me start with our platform. As you recall, in August, we closed the ACS acquisition. We have experienced significant momentum with the ACS solution as the number of ACS opportunities in the pipeline has increased over 30% in this very short period of time. As a reminder, ACS is a fit for our $1 million-plus ARR customers, giving us continued strength in our march-up market. For example, they're opening doors for several Fortune 100 deals, although it's still early days. A good portion of our innovation continues to be centered around our AI and automation portfolio, and we are seeing significant traction as a result of this innovation. For example, our professional services team worked on more than 250 AI deployments during the quarter. Additionally, bookings for our agent assist product increased 150% year over year, driven by our AI summaries customer trials. It's clear that our practical approach to AI continues to deliver real tangible value to our customers. This is directly tied to our core AI tenants, including our beliefs that AI should be available across our platform, that AI should be democratized and available to all customers, that AI should remain engine agnostic, and that AI should be applied in a responsible and ethical manner. And now I'd like to focus on our March up market and international expansion. I'm pleased to report that we continue to see strong momentum up market in booking $1 million-plus ARR deals. As a reminder, $1 million-plus ARR customers make up more than 50% of our recurring revenue. I'm also pleased to report that our pipeline for strategic deals doubled year over year in Q3. In addition, we had a record number of enterprise and strategic RFPs in the third quarter, which increased 66% year over year and 21% sequentially. This march-up market and our continued international expansion are increasingly being driven by our ever-growing network of global partners and their dedication to leading with Five9. I'm very pleased to share that IBM has expanded their relationship with us as a global SI partner, reselling Five9 along with their CRM and ITSM offers, and also as a technology partner, integrating Watson X with our AI solutions. This is a common model amongst large SIs, as we are complementary and tightly integrated with solutions such as Salesforce, ServiceNow, Microsoft, Google, and others. We have now established ourselves as a global brand with the help of key strategic partners like IBM, BT, Telus International, Deloitte, and Accenture, to name a few. Our partnership strategy is built not only on recruiting new partners, but also on enabling and empowering partners within our methodology of sell with, deliver with, and build with. This approach was one of the key drivers that led to our EMEA bookings growing 57% in Q3. In addition, a US managed service provider who has been our partner for the past three years celebrated their largest quarter with several new customer logo wins and over 4 million of incremental ACD added in the quarter. Their success is built in part on their ability to implement Five9 solutions integrated with their enterprise management platform and other services. Our leadership in the channel is further validated by the three leading technology solution distributors in our industry, Teleris, Avant, and Intellisys ScanSource, each recognizing 5.9 as their number one CCaaS supplier. Furthermore, a recent channel survey by Baird ranked 5.9 number one for top CCaaS solutions sold by the channel and number one in easiest to do business with. These partners, along with many others, are helping place us in a prominent position within the global channel community. In closing, I'm very excited about our continued momentum out-market globally and with the success we are having with our AI and automation offerings. The opportunity ahead for Five9 has never been better. And I want to thank all of our employees who bring passion and purpose to their work every day to make this a reality. And with that, I'll turn it over to our president and CRO, Dan Berklin. Dan, go ahead.

Thanks, Mike, and good afternoon, everyone. I'm pleased to report that we had a strong bookings quarter. Our pipeline reached another all-time high with our strategic accounts pipeline doubling year over year, and our sales of AI and automation solutions are seeing unprecedented momentum. As you know, the very high end of our market is lumpy with regards to the timing of bookings. However, I'd like to remind you that the large enterprise category of $1 million to $5 million of ARR is the bread and butter of our business, and in aggregate is a larger contributor to our revenue growth than the mega deals. Now, as I usually do, I'd like to share some examples of new logo wins during the quarter. The first example is a healthcare insurance company that was moving away from an Avaya on-premise version that was being end of life. They chose Five9 along with one of our leading UC partners with deep integration in order to gain visibility and provide seamless transfers between contact center workers and back office employees, all from a single UI. We will also include our chat, email, SMS, QM, and interaction analytics. And we anticipate this initial order to result in approximately $2.3 million in ARR to 5.9. The second example is a hospital billing and collections company. They were using Cisco that was being managed by a third party, making moves, ads, and changes cumbersome and also long lead times. They evaluated the major CCaaS providers and chose 5.9. We're including the full omnichannel solution with email, chat, SMS, as well as both voice and digital IVAs. We are also providing them with QM, interaction analytics, WFM, and agent assist, where they expect to reduce call handle times by up to 50%. We anticipate this initial order to result in approximately $2.3 million in ARR to 5.9. The third example is a utility company serving many markets in North America. They were using a hosted Cisco solution that was nearing its end of life. They chose 5.9 from all the major CCaaS providers and will be implementing our core offerings along with the advanced solutions including chat, email, agent assist, our complete WFO suite powered by Verint, performance management, and gamification. This customer will also be deploying our voice and digital IVAs for self-service to pay invoices, check account balances, and canceling or moving service. We anticipate this initial order to result in over $2.2 million in ARR to 5.9. And now, as I normally do, I'd like to share two examples of existing customers who have expanded their use of Five9. This first example is a global pest control company who had been using our system for several years and was recently acquired by a European company who is using an on-prem legacy solution. The North America operations team was able to do a side-by-side comparison with real production traffic to compare performance over several months. They chose us for our superior reliability as well as our AI and automation portfolio. We anticipate their spend to increase from approximately $2.1 million in ARR to approximately $4.2 million in ARR. This last example is a leading global ticket sales and distribution company where we began providing our solution throughout Europe more than five years ago. In early 2022, we used the strong success we established with them in Europe to parlay this into their US operations where they saw increased call volumes. We now continue to expand as we replace their legacy on-prem solution This recent order increases their spend with us from approximately $1.2 million in ARR to over $2.2 million in ARR. So as you can see, we are executing extremely well in landing some of the largest brands in the world, as well as helping our existing customers expand and reimagine how they deliver CX to their customers. And with that, I'll hand it over to Barry to cover the financials. Barry?