Matterport, Inc.

Good afternoon, everyone, and welcome to the Matterport Incorporated Fiscal 2022 Second Quarter Results Conference Call. All participants will be in a listen-only mode. Should you need assistance, please say no to 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. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. At this time, I'd like to turn the floor over to Suwon Kim. Sir, please go ahead.

Thank you. Before we begin, I'd like to remind you that today's call contains forward-looking statements with the meaning of the federal securities laws, including but not limited to statements regarding Matterport's future financial results and management's expectations and plans for the business. These forelooking statements are subject to numerous risks and uncertainties that may cause actual results to differ materially from those discussed on today's call. Additional information regarding the risks and uncertainties that could cause actual results to differ from forelooking statements can be found at our filings with the SEC. Any forelooking statements made on this call speak only as of today and matter presumes no obligation to update or revise them, whether as a result of new developments or otherwise, except as required by law. In addition, today's call may include discussion of non-GAAP financial measures. These measures should be considered as a supplement to and not a substitute for GAAP financial measures. Reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP measure can be found in today's earnings deck, which is available on the company's website. Hosting today's call are RJ Pittman, Chairman and Chief Executive Officer of Matterport, and JD Fay, Chief Financial Officer. Now, let's turn it over to RJ to begin.

Thanks, Suwan. Good afternoon, everyone, and thank you for joining us today. I am pleased to share our second quarter financial results with you. We had another strong quarter delivering on our product strategy, market expansion, and key results. Total revenue for the quarter was $28.5 million, and we delivered $18 million in subscription revenue, up 7% sequentially from Q1 above our guidance. We reported strong operating metrics with our subscriber base growing 10% sequentially to over 616,000 subscribers and spaces under management also increasing sequentially 10% to over 8 million spaces. These results reflect the strong underlying demand from our enterprise customers and the tireless efforts of our employees who have delivered on big commitments to our customers. While the global economic outlook remains uncertain for everyone, we have been effectively managing and leading through it, as reflected in our progress and in our results and guidance. We continue to optimize for growth with as much efficiency as possible. Our core SaaS business continues to grow, and our strong financial position enables us to fully execute our business plan and adapt to the challenging macro environment. Continuing supply constraints has been the primary factor limiting our full revenue potential in the near term. and our ability to meet demand for our pro to camera. We have a record order backlog and we expect to fulfill the backlog during Q3. Innovation remains key to our success in both the near term and the long term. Our investment in the capabilities of digital twins has never been more important to our customers and to driving global adoption. And it remains one of our most distinguished competitive advantages. Digital twins are incredibly valuable to professionals, small businesses and large enterprises alike. They create value and breakthrough operating efficiencies for any type of building or space, delivering immediate ROI for our customers in any macro environment. In fact, they are deflationary because of the relatively low cost to create them and the yielded benefits that reduce operating costs. For large enterprises, the Matterport Digital Twin becomes a collaborative workgroup platform with the ability to bring their here, enabling widely distributed teams to work virtually in a dimensionally accurate, photorealistic space together from any time zone. In 2022, there is no better platform for marketing property than the one that starts with the Matterport Digital Twin. And with our recent acquisition of VHT Studios, we are dramatically enhancing the Matterport value proposition with new capabilities that help our customers book, lease, and sell properties faster and for the best possible price. I'd like to discuss our advancements in more detail to highlight our forward progress and unique ability to drive pertinent technology changes across this $327 trillion asset class that we call the built world. Then I'll hand it over to J.D. Fay to discuss our financial results for the quarter in more detail. We believe our digital twins can drive higher revenue and lower cost for every building. Once a digital twin is created, our platform delivers many value-added services and property insights that provide immediate cost savings and operating efficiencies for the space. Data-driven decisions, remote facilities management, virtual inspections, and collaboration in a virtual property save customers significant time and money. This reduces the strain on the labor force and reduces the overhead associated with routine on-site property visits. As the power of digital twins starts to be recognized, third-party consultants like Capgemini are publishing their findings that digital twins can indeed reduce time to market and improve operational efficiency and sustainability efforts. While we are in the peak of the summer travel season, I'd like to share two customer examples in the travel and hospitality space with Bacasa and Air France KLM. This category continues to develop as a strong market for growth as the world recovers from the pandemic and people return to travel. Starting with Bacasa, North America's leading vacation rental management platform has increased its booking conversion rate on Bacasa.com by nearly 12% with Matterport's Immersive Digital Twins. an extraordinary lift metric by hospitality industry standards. As such, it comes as no surprise that nearly 90% of Vacasa's more than 30,000 property listings today include Matterport's immersive digital twins. Visitors to Vacasa's website can virtually walk an entire property with stunning realism and dimensional accuracy. According to Vacasa, property listings that feature a Matterport digital twin keep guests engaged three times longer, giving them the added confidence to book a new destination, sight unseen. La Casa has digitized over 64 million square feet of real estate with Matterport since 2015. They can share and explore Matterport spaces with friends and family with the confidence they're booking the right vacation home for their needs. For less than the cost of a professional photo shoot, Matterport delivers a 3D digital twin still photography, floor plans, and teaser videos to better merchandise rentals across social media and online channels. And the first digital twin of any property captured with our software and your smartphone is completely free. Next, KLM Royal Dutch Airlines, part of the Air France KLM Group, has created Matterport Digital Twins for each type of aircraft in the fleet. KLM is using Matterport to remotely train the ground and flight crew and to provide an immersive virtual experience for customers. KLM began using Matterport in 2017, capturing the first digital twin of a Boeing 787 Dreamliner to train ground crews on cleaning the aircraft. When crews reduced cleaning time by 30%, KLM recognized the potential of Matterport digital twins to streamline training for other departments, and utilize Matterport to further capture digital twins in its entire fleet. Today, KLM manages a library of 104 digital twins that have been viewed nearly 1 million times, including multiple versions for each of the 14 types of Boeing, Airbus, and Embraer aircrafts that make up its fleet. Flight attendants utilize Matterport's digital twins to learn where important safety and hospitality items are located while an annotated digital twin for ground crews illustrates where service trolleys are stowed. Meanwhile, pilots can easily refer to an aircraft's digital twin during a pre-flight safety check if an issue is detected. Equipped with Matterport digital twins, KLM employees do not need to travel to Amsterdam Airport's ski pole for training and instead use immersive digital twins. Since virtual trainees no longer interrupt the maintenance work of an aircraft with in-person visits, it helps to get the aircraft to return to service faster and with less downtime. In addition, KLM's digital twins have helped streamline its fleet management. For example, when upgrading the Wi-Fi routers used on a specific aircraft, KLM used the highly accurate data within the digital twin to confirm measurements and optimize the placement of new routers. Beyond training its internal teams, KLM uses digital twins to showcase its aircraft cabins to travelers. Passengers can virtually experience a cabin, compare sections, and view their ideal seat before purchasing. Moving on to the enterprise business. We are delivering powerful new enterprise features as we continue to invest R&D resources to become a mission-critical software partner for the largest companies around the world. Our cloud software platform offers a combination of security, compliance, and access control features that Fortune 500 customers require. Additionally, we are launching more scalable services to complement the platform advancements this quarter, including longer service and support hours, expanded language support, professional services, and the ability to offer robust SLAs to enterprises that require it. Collecting, securing, and properly managing customer data is core to Matterport's business. Our platform is built on a robust and secure infrastructure that includes end-to-end encryption of data, advanced administrative controls, and network security. SOC 2 Type 2 compliance is just one example of the enterprise features large customers are looking for. We undergo independent third-party annual audits against SOC 2 Type compliance. allowing customers to work in a highly secure and compliant environment. Beyond enterprise security, customers are looking for features and functionality that help to integrate Matterport into the way they work, including their day-to-day operations and their management of employees. With enterprise user management and permissions, customers can readily deploy scalable secure access control down to the individual employee or work group for each digital twin or a large group of them. In June of 2022, we released a new feature we call Private Model Embed. This is a great new way for enterprises to privately share digital twins with a large group of employees on the corporate network without requiring additional user licenses to access the space. Private Model Embeds enable seamless read-only access to digital twins with no login required. This helps companies reduce friction and speed adoption of their Matterport digital twins across the organization while extending Matterport into their existing corporate workflows. Our enterprise customers are becoming more confident in the power of our digital twins and are scaling with Matterport and bringing new spaces online every day. We saw rapid revenue growth from our largest customers and a strong net dollar expansion rate. We currently have the largest pipeline of enterprise opportunities we have seen since launching the enterprise platform in 2021. The enterprise go-to-market organization we have been building over the last year is starting to yield tangible results. We've increased our penetration to 23% of the Fortune 1000, now deploying Matterport, as the customer value proposition becomes clear and demand continues to build. I am encouraged by the results of our team's hard work and commitment to scaling our digital twin platform for our customers. and look forward to helping them accomplish their own digital transformations with tangible results. Finally, I would like to discuss the strategic acquisition of VHT Studios, closed in early July. VHT extends our industry leadership with a more comprehensive approach to marketing properties online. Together with VHT, we will move our offering closer to the customer to service more property listings, with a more robust digital marketing solution than we've ever offered before. DHT's market leadership in digital property marketing spans more than 20 years and represents tremendous strategic value for Matterport's digital twin platform for the real estate market and offers great potential to impact our commercial real estate and travel and hospitality markets as well, where digital marketing is vital to growth. Together, VHT and Matterport are creating the most comprehensive digital marketing technology platform targeted at large-scale residential real estate brokerages and enterprises, with our digital twin at the center. Starting in the U.S. this quarter, we intend to expand the offering internationally in the future with a fully integrated real estate media marketing solution, including photos, videos, floor plans, drone imagery, Matterport digital twins, and more. BHT has established and maintained dozens of longstanding enterprise customers, including seven of the top ten brokers in the United States, like At Properties, Baird & Warner, Caldwell Banker, Compass, Parker & Group, and Douglas Element. We look forward to working with all of them and growing our business together. BHT's world-class customer service has cultivated lasting relationships with their clients. with the majority of the largest customers on board for nearly two decades each. We're excited to expand our reach with these leading real estate brands to deliver the power of the digital twin and our unique property data insights to every listing online. Consistent with our business model, 80% of VHT's revenue at the enterprise level is recurrent. This substantially reduces churn more commonly found at the agent and listing level, and streamlines the integration of our respective offerings. Residential real estate will continue to be a substantial part of our business. It represents $170 trillion in asset value, more than half of the total real estate value globally. We believe we can continue to grow in real estate no matter what happens with the economy. While we've seen rapid adoption of digital twins over the last few years, adoption still remains nascent. We are closely attuned to the quickly changing real estate landscape and Matterport has proven to be an indispensable tool in competitive markets and in constrained markets when demand softens, inventory rises, and properties stay on the market longer. In both cases, property agents and brokers need a catalyst to maximize their transactions and keep the market moving forward. We will continue to create opportunities like these to compound our growth and achieve our mission. These examples highlight the company's hard work and focused execution over the past quarter. We are driving operational excellence and our strategic growth investments are paying off. I am excited for what's coming next for Matterport. We have a lot in store for our customers. I will now turn it over to JD Fay to discuss our financial performance for the second quarter of 2022. Thank you, RJ.