Gen Digital Inc.

Good afternoon, everyone. Thank you for standing by. My name is Jerome, and I will be your conference operator today. I would like to welcome everyone to the Norton Live Plug Fiscal 2022 Second Quarter Earnings Call. Today's call is being recorded, and all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. At this time, for opening remarks, I would now like to pass the call over to Ms. Mary Lai. Head of Investor Relations. Miss, you may begin.

Thank you, Jerome, and good afternoon, everyone. Welcome to the NORM LifeLock Fiscal 2022 Second Quarter Earnings Call. Joining me today to review our Q2 results are Vincent Pellet, CEO, and Natalie Dursey, CFO. As a reminder, there will be a replay of this call posted on the IR website, along with our earnings slides, press release, and materials defining our non-gap metrics. I'd like to remind everyone that during this call, all references to the final metrics are non-GAAP and all growth rates are year-over-year unless otherwise stated. A reconciliation of non-GAAP to GAAP measures is included in our press release, which is available on the IR website at investor.nortonlifelock.com. In addition, we previously announced the merger of Norton LifeLock and VAST. The information shared today will be limited to what has already been disclosed in the document published on our website in connection with the deal. Today's call contains statements regarding our business, financial performance, and operations, including the impact of the ongoing COVID-19 pandemic on our business and industry, which may be considered forward-looking statements, and such statements involve risks and certainties that may cause actual results to differ materially from our current expectations. Those statements are based on our current beliefs, assumptions, and expectations, and speak only as of the current date. For more information, please refer to the cautionary statement in our press release and the risk factors in our filings with the SEC, and in particular, our annual report on Form 10-K for the fiscal year ended April 2, 2021. And now, I will turn the call over to our CEO. Vincent?

Thank you, Mary. Welcome and good afternoon, everyone. We've come a long way since we became a consumer-focused standalone company exactly two years ago today. As I reflect on Northern LifeLock's transformation, I'm extremely proud of our team. We committed to operating within financial discipline and bringing meaningful and sustainable growth to this business, and we have delivered. We have relentlessly been building a strong track record and remain focused on meeting our long-term objectives. As you've heard me share before, we are focused on driving growth by improving customer experience, scaling our integrated cyber safety platform and accelerating the pace of our product innovation from core security to trust-based digital solutions. By putting our customers first and relentlessly executing to our plan, we believe our long-term goals are within reach. Our strategy is working. And as we delivered another quarter of solid and consistent growth, Q2 revenue was up 11%. with high single-digit growth in bookings. We are delivering strong profitability and continued EPS expansion of almost 20% year-over-year. Our high single-digit bookings growth was in line to our long-term objectives and is reflective of our normal seasonality with the first half of our fiscal year historically being seasonally lower. The start of Q2 was impacted by expected weaker summer demand and COVID reopening as more people mobilized or prioritized to travel and other activities. As we balanced all of our operational metrics and investment, we finished the quarter with strong momentum, delivering our eighth straight quarter of net direct customer ads sequentially. Our direct customer count grew over 178,000 sequentially, and we added over 2.6 million customers year-over-year, bringing our total customer count to 23.3 million. In Q2, our direct-to-consumer revenue, which represented the majority of our business, was up 9%, with our pool growing slightly quarter-over-quarter and unit retention stable. We have continued to build a richer and more robust product portfolio as we reach more consumers on a global basis while driving higher engagement with our existing customers. Our net promoter score continues to improve from low 40s last year to 49 this quarter, reflecting our focus on customer experience and providing peace of mind to our customers as they live their digital lives. Our international expansion efforts continued in Q2 and grew double digits, similar to last quarter. We continue to invest in our freemium model as it increases our consumer reach and awareness, and we are encouraged that our nascent expansion into identity internationally is now available in more than 20 countries across Europe and Asia. It is a critical component of our ability to provide more value to our customers outside of the U.S., replicating the success we have had with ID Advisor in Japan, where we combined dark web monitoring with elements of restoration. Our partner business posted double-digit revenue growth for the quarter for the actually fourth straight quarter, up 25% in Q2. All channels contributed meaningfully to these results. Amongst those, the employee benefits channel delivered another very strong quarter. We've expanded beyond the United States, offering our employee benefits solutions to Canadian employers and unlocking a broader customer base. Our investments in this area are paying off as we have strengthened our sales team and market coverage in the last few quarters. We intend to expand our overall partner business and we will continue to invest in our multi-channel approach, evaluating all potential opportunities and markets globally. Overall, we are on track to our plan and committed to investing in what we see as a long-term secular growth opportunity to develop the best cyber safety portfolio for consumers. As a result, we continue to accelerate the pace of our product innovation pipeline as we work to bring cyber safety to every digital user and release products that help protect consumers' devices, privacy, and identity. We opened the quarter with the release of Norton Utilities Ultimate, a new performance maintenance offering that helps create a faster and smoother and more secure experience for consumers, whether they're gaming or browsing or streaming content or more on their Windows PC. We expanded Norton Family with new features including favorite locations to help parents establish approved geographic locations and receive notifications when their child's device arrives or departs those set locations. We also introduced Alert Me, which helps parents stay informed about their children's location by setting specific dates and times to receive automatic check-in alerts from the location of their child's device. Both of these new features were quite timely as many kids headed back to school in person. On the identity front, we added payday loan lock to selected U.S. life lock plans to help block the opening of fraudulent payday loans and other short-term loans. And we've added new features like social media monitoring in more markets to provide consumers with broader protection as their digital footprint expands. As awareness grows globally for identity protection, we continue to evolve our roadmap to protect our customers and provide the most relevant products and features to new audiences. As we continue to strengthen our privacy pillar and help provide additional ways for consumers to control their online privacy, we released Northern Anti-Track in the US, a new app and browser extension that helps prevent websites from tracking and profiling users in ways normal private browsers or VPNs cannot do. That way, people can protect and control their digital footprints from companies and websites that track online activities and collect or sell their personal data. We've seen positive momentum from this new product release as consumers are seeing ways to protect their privacy. And I'm pleased to share that Northern Anti-Track as we expanded now to APG and EMEA earlier this week. Privacy overall is one of the three pillars of our cyber safety portfolio, and we should continue to see investment in this area to help consumers manage their privacy and reputation online. In Q2, we also released our first environmental, social, and governance report. This report highlights Northern LifeLock's ongoing pledge to bring together our team, expertise, and technology to help build a safe, inclusive, and sustainable future. We're making good progress on this front, and I'm proud of all of our employees, the commitment we have made together to develop a responsible company. I encourage you to check all of our achievements in that area on our IR website. Additionally, we were recognized by the Business Intelligence Group 2021 Sales and Marketing Technology Awards, or what they call the SEMIs, We drank Northern LifeLock as one of the top medium-sized companies of 2021 for innovation in sales and marketing technology. We were recognized for our efforts upgrading customer service operations with the development of a new internal sales platform that was built by our own in-house engineers and launched in the spring of 2021. This technology enabled us to better deliver key customer services within a single, easy-to-use interface. The platform also replaced a legacy vendor-supplied solution, driving cost efficiencies for the company. This is a great example of the teams living our value. They advocated for the customer, they were empowered to take initiative, they identified the opportunity, and they delighted customers while improving our business operations. And more importantly, they delivered. Before I turn the call over to Natalie to discuss the financial results, I would like to provide an update on our proposed merger with Avast. We have made great progress and we continue to be enthusiastic about the combination of the two companies and the opportunity to accelerate innovation in cyber safety. We crossed an important milestone today with Northern LifeLock shareholders voting to overwhelmingly support our ongoing transformation through the proposed merger with Avast, with the next key step being the Avast shareholder vote scheduled for November 18. We are also actively and collaboratively working through the antitrust and other regulatory processes in all relevant jurisdictions, and we believe we are on track to close mid of next calendar year, 2022, as previously stated. Our strategy has been to protect and empower consumers as more and more of their lives move online, and this transaction will allow the combined companies to invest in and accelerate innovation for new cyber safety products. And now let me turn the call over to Natalie for more details on the financials.