LiveVox Holdings, Inc.

Thank you for standing by. This is the conference operator. Welcome to the LiveVox Holdings first quarter 2022 earnings call. As a reminder, all participants are in listen only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, you may press star then one on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star and zero. I would now like to turn the conference over to Alexis Watt, Vice President, Head of Investor Relations. Please go ahead.

Good afternoon, and thank you for your participation today. With me on the call are Louie Summey, Chief Executive Officer and Co-Founder of Libox, and Greg Clevenger, Executive Vice President and Chief Financial Officer. Before we get started, I would like to remind you that comments made during this conference call and webcast contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties. Any statement that refers to expectations, projections, or other characterizations of future events, including financial projections or future market conditions, is a forward-looking statement. The company's actual future results could differ materially from those expressed in such forward-looking statements for any reason, including, without limitation, those listed in the risk factors section of our SEC filings. LiveVox assumes no obligation to update any such forward-looking statements. Please also note that past performance or market information is not a guarantee of future results. Certain information discussed on this conference call was derived from third-party sources and has not been independently verified, and accordingly, the company makes no representation or warranty in respect of this information. During this conference call, the company will discuss non-GAAP financial measures as defined by SEC Regulation G. A reconciliation of each of these non-GAAP measures to the most directly comparable GAAP financial measure can be found in the earnings press release, which is available on the Investor Relations website, investors.livebox.com. A recorded replay of this call together with related materials will be available on our investor relations website, investors.liveox.com. LiveVox's earnings release and Form 10-Q for the period ended March 31, 2022, will also be available on the company's website. With that, I'll turn the call over to Louie to begin.

Good afternoon, everyone, and thank you for joining us. My name is Louie Summey, and I'm the CEO and co-founder of LiveVox. Today, I'm pleased to share with you our strong start to 2022, as well as our plans for continued success throughout the year. I'll begin with summary financial results. Total revenue for Q1 was $32.1 million, which was at the high end of our guidance. Contract revenue came in above the high end of our guidance, up more than 21% year over year. Usage revenue came in at the middle of our guidance range. Gross margin came in above guidance at 60.4%, and our EBITDA results were at the mid-range of guidance as we continue to see benefits from completing the migration of our platform and 100% of our customers to the public cloud. As a result of our go-to-market investments and positive dynamics in the CCaaS space, our pipeline is up over 40% versus this time last year, and for Q1, New logo wins are up more than 25%. Bookings are setting records as well, with year-to-date bookings up over 30%. We continue to see strong momentum in the number of full enterprise opportunities, which we characterize as customers taking 10 or more of our products, now comprising more than 15% of our customer base. The number of products taken by new customers in Q1 is up 30% year-over-year, which we believe is a testament to our easy-to-deploy, seamless omni-channel approach. Net revenue retention improved significantly to 113% in Q1, up from 105% last quarter. And lastly, our differentiating digital and AI products continue to be in high demand. Digital revenue now represents 20% of our business, up approximately 50% year over year, and we signed four new AI virtual agent deals in Q1. Let's pivot to sales and marketing. And today I want to focus on two key areas of our go-to-market strategy. First is our continued traction building relationships with master agents. As a reminder, Wybox primarily grew in the past through direct sales efforts. Over the past year, we've signed agreements with seven master agent organizations. More importantly, the seasoned team we brought on board to grow these relationships has made significant progress. We're a top five CCaaS partner at our two largest master agent partners, and the number of partner-driven demos has increased over 60% year over year. We recently announced the launch of Activate, our purpose-built channel partner platform that easily enables access to current and prospective partners to sales enablement materials, technical guidance, and competitive incentives to help market and sell Livox's blended omnichannel capabilities to new customers. I'm excited to share that we continue to see positive momentum from these efforts. While last year's bookings from master survey agent opportunities were approaching 10%, they now represent nearly 15% of our pipeline, And based on recent activity, we anticipate that number to continue to grow. The second key go-to-market point I will share, which is essentially the next phase of our strategy, is our expanding partnership ecosystem. This includes systems integrators, VARs, and strategic alliances, many of whom are technology resellers. Livox is in a unique position to become a preeminent partner with resellers looking to add CCaaS to their capabilities or offerings. as there are numerous advantages our platform brings to the table. First, and I shared this on our last call, the LiveOps platform and our customers are 100% in the public cloud. More specifically, Amazon Web Services or AWS. This gives us and potential partners a number of strategic advantages. It enables us to offer best-in-class reliability through AWS availability zones and an active-active architecture. and it enables us to quickly and easily scale horizontally to support the largest contact center organizations. Second, as a result of being born and bred in the financial services industry, Livebox's security and compliance protocols and features and functionality are unmatched in the industry. This is becoming table stakes for larger enterprises migrating to the cloud, as we have seen with our financial service clients. Third, Livebox is an out-of-the-box platform. Comparatively, it's easy to implement, easy to orchestrate, and easy to optimize with a rich feature set. Perfect partners seeking a platform that's easy to demo, sell, and support. We believe this additional phase of our go-to-market strategy can have significant positive impact on our bookings and revenue as we move into 2023. In fact, in the next few weeks, our Salesforce connector will be available in the Salesforce AppExchange where we've already seen new revenue opportunities. And we recently signed a partnership agreement with NuStar Inc., a transunion company that we believe will be mutually beneficial. It's important to note that as we've scaled our sales and marketing effort in the past and invested in increasing our overall awareness in the marketplace, we've experienced a clear uptick in partnership interest. As these opportunities continue to emerge, we're poised to leverage our sales and marketing effort to support growth in this area. As mentioned, we continue to add significant new customers to the platform, and I want to share a few examples. The first is a large vacation resort management and rental organization. They outgrew the capabilities of their previous vendor and moved to our platform to improve the experience of all three of their contact center areas, including property management, sales and marketing, and receivables management. Their omni-channel solution includes our native CRM as well as our quality management and ticketing products. Next is a state mental health hotline and 911 service. This was one of our fastest deal closes ever. Livebox was brought in to replace an on-prem solution which did not offer our full functionality. The omnichannel solution they required includes our native CRM, scripting, call recording, and speech analytics. Of note here is how quickly we were able to implement this customer through our Smart Start initiative mentioned on a previous earnings call. Next, and this was brought in by a channel partner, is an outsourced marketing and lead generation agency who needed our platform for greater reliability, compliance, and to maximize productivity. And finally, we had three significant upsells in Q1, expanding our relationship with three global BPOs with a combined agent population of more than 50,000 agents. We're excited about these and other wins to date as they validate our full platform omnichannel offering across multiple use cases. As noted, our pipeline is more robust than ever, and we're very excited for the coming weeks and months as it relates to bookings. I'm also pleased to share that our platforming capabilities continue to advance and make digital and AI ever easier to adopt. Most notably, our U17 product releases that I shared last quarter went GA on schedule. As a reminder, this release offers several new capabilities, including an enhanced speech and multichannel analytics platform combined with quality management capabilities. That incidentally won best innovation in customer experience at Enterprise Connect this year. U17 also includes enhanced ticketing and CRM capabilities, more robust customer and operational analytics, and enhanced digital messaging capabilities to help agents optimally communicate with customers on their channel of choice. We announced the launch of LiveAux Knowledge Center, a powerful self-service and collaboration tool that enable agents and their customers to quickly find answers to product questions while providing valuable insights into customer service trends and opportunities. And one of the improvements I'm most excited about is the continued reduction in our implementation times, down by 35% year over year. Speed to market means speeds to value for our customers and the speed to revenue for us. In summary, I'm very pleased with our progress year to date. I believe our burgeoning pipeline, strong bookings, 100% migration to the public cloud, and intensified interest from potential strategic partners are validating our product and direction as a company. I continue to be optimistic that we're well positioned for a strong 2022 and beyond and look forward to our next communication. I want to thank our team for all their hard work, our board, and of course our customers. I'll now turn it over to Greg Clevenger to review Q1 financials and provide guidance.