Marchex, Inc.

Good afternoon, and thank you for joining the Marchex third quarter 2023 earnings call. My name is Kate and I will be the moderator for today's call. All lines will be muted during the presentation portion of the call with a question and answer session at the end. I would now like to turn the call over to your host, Trevor Caldwell, Senior Vice President of Strategic Initiatives and Investor Relations. You may proceed.

Thank you, Kate. Good afternoon, everyone. Welcome to March X's Business Update and Third Quarter 2023 Conference Call. Joining us today are Edwin Miller, our CEO, Holly Aglio, our Chief Financial Officer, and Michael Renz, our Vice Chairman. Before we get started, I would like to take this opportunity to remind you that our remarks today will include forward-looking statements, including references to our financial and operational performance, and actual results may differ materially from those contemplated by these forward-looking statements. Risks and uncertainties that could cause these results to differ materially are set forth in today's earnings press release and in our most recent annual and quarterly report filed with the SEC. Any forward-looking statements that we make on this call are based on assumptions as of today, and we undertake no obligation to update these statements for subsequent events. During this call, we will present both GAAP and non-GAAP financial measures. Reconciliation of GAAP to non-GAAP measures is included in today's earnings press release. The earnings press release is available in the best relations section of our website. At this time, I want to turn the call over to Edwin.

Thank you, Trevor, and good afternoon to everyone. I'd like to thank you all for joining us today for a quarterly earnings conference call. I'm pleased to share our progress with you during this period of transformation. I've been on the job for 275 days. And we are well on our way to positioning March X for long-term success. We're building a culture that's highly committed and fosters innovation and collaboration. We continue to advance our technology in order to deliver new and powerful value creation for our customers and prospects. And we are building out a world-class team to tackle the robust market opportunities in front of us. We are moving fast as a company. Furthermore, I'm pleased to share that our progress has enabled us to achieve profitability younger than expected. We are seizing on this momentum and the big opportunity in front of us, and that is to increase our leadership in the conversational intelligence market. Today, I'd like to highlight three key initiatives that we believe will thrust us toward being a nine-figure business in this space. These initiatives revolve around creating a world-class team, streamlining and enhancing our technology, and the formation of excellence in our go-to-market motion by vertical markets. Let's look at our first initiative, which is building a world-class team with a world-class culture. When I arrived, we had a high-quality team in our vertical markets with many years of experience. We organize towards shared services to empower our vertical market talent. This has worked well with client engagement. Further, given how quickly the AI landscape has evolved, we have been adding to our talent pool in order to build towards the future and support our growth opportunities. We're investing in additional leadership and building out our data sciences and AI teams to leverage our vertical market understanding in depth. we know we need to move fast to advance our products and offerings, and that it's our people who make the difference. Thus, we are prioritizing and investing in our talent to ensure we capitalize on our significant market opportunity and can harvest the revenue opportunities that will drive growth over time. Our second initiative focuses on continuing to optimize our technology stack to create a unified data pipeline and move up the technology stack. MarchX possesses a wealth of conversational data across multiple channels and vertical markets. This asset is a powerful differentiator and it holds incredible value for businesses ranging from Fortune 500 companies to individual service providers. Our future is to continue toward one data pipe, one step, one MarchX culture, advanced ai math models tailored to our vertical market clients advanced data analytics and creating more ai signals that will allow our clients to derive an end-to-end view of a lead to a client as well as improving the overall client experience we are in the flow of over a billion minutes of conversational data and the potential for mission critical insights for businesses is boundless. Moving to one data pipeline and one technology stack continues to be a significant focus for the business, and we believe it is one that will accelerate our product pipeline and speed innovation in the new world of generative AI. Given the increased efficiency, we also see these moves as leading to the potential for significant margin improvement in the business over time. Our third initiative focuses on strengthening our vertical go-to-market approach. We need to leverage all that we've accomplished in the past in building strong relationships with some of the largest companies in the world. This will help us create new relationships in the coming quarters within our selected vertical markets, as well as accelerate sales growth through our go-to-market motions and product marketing strategies. All of this should be done in tandem with and on the back of our moving to a clean one stack of software, which enables us to innovate with new automation tools for increasingly efficient onboarding of clients. These efforts will enable our clients to deliver great customer experiences while allowing us to expand our API capabilities, which we are continually working to improve as part of our integration initiatives. Every day I'm in this role, I'm reminded of one thing. We are at a pivotal moment in human history. The rapid evolution of AI is changing the game. It is poised to usher in significant change at every level of human interaction. But we're ready. MarchX lives in vertical markets with unique and rich data versus a thin horizontal approach to the market. We strongly believe that the vertical position is the best place to be within the AI market. Creating a single efficient data pipeline will arm us with the power to unleash deeper and more meaningful insights at a scale we've never seen before. Our customers will up-level their abilities to understand and engage their customers in ways they too have never seen before. On that note, I want to share that we recently launched new AI features to our expanding conversational intelligence software suite. AI call summaries and AI sentiment suite are the first of our expanding generative AI driven capabilities. There will be more to come. AI call summaries leverage the power of generative AI to transform the way businesses capture and utilize critical insights from customer interactions. This technology gives concise, natural language descriptions of what occurred on a call between a consumer and a business. Decimate Suite combines structured and unstructured data to provide a holistic view of customer emotions during conversations. The possibilities in helping businesses to understand and meet the emotions of the customer as they engage a business will help sales close rates and we believe will drastically improve the customer experience. These can be powerful insights for businesses to understand and engage consumers. Our commitment to AI is a driving force and can unlock the potential for our business on a vast scale. It can help our customers foster better relationships with their consumers and drive meaningful revenue growth. That's why right now we are laser focused on the one data pipeline and one stack initiatives. In fact, we expect this effort to accelerate our ability to deliver new features and products to our customers and enable MarchX to cross that in ways that in the past were not possible. We believe this to be an essential step toward accelerating growth and building a nine-figure revenue business in the future. Conversational intelligence is a multi-billion dollar market. MarchX has a significant advantage in several verticals as we have industry-leading customers with multi-year contracts who are asking us for more. The initiatives I've outlined will enable us to grow at rates that meet this demand over time and deliver a compelling margin profile to the business. I'm excited about where we are and also where we're headed. We have a clear vision, and we are moving quickly and thoughtfully in all areas of our business. While some of these efforts will take time, I am mindful that we still expect to deliver a compelling financial profile as we build, while keeping an open mind to all potential strategic initiatives that can help us unlock the value of March X. I look forward to updating you on our progress next quarter. With that, I am so excited to welcome the newest member of our team, Holly Aglio. She will walk you through our financials.