Thryv Holdings, Inc.

Ladies and gentlemen, good morning. My name is Abby and I will be your conference operator today. I would like to welcome everyone to Thrive's third quarter 2022 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. If you would like to ask a question during this time, simply press the star key followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one once again. Thank you. And I will now turn the conference over to Cameron Lessard, AVP of Investor Relations and Capital Markets. You may begin.

Thank you for joining us on today's conference call to discuss Thrive's third quarter 2022 financial results. With me on today's call are Joe Walsh, Chairman and Chief Executive Officer, and Paul Rouse, Chief Financial Officer. Before we begin, I'd like to remind you that shortly before today's call, we issued a press release announcing our third quarter 2022 financial results. We also published a Q3 investor presentation on our website at investor.thrive.com. Please note that information regarding our quarterly performance and guidance can be found towards the back of the presentation. I would like to remind listeners that some of the comments made on today's call and some of the responses to your questions may contain forward-looking statements about the operations, and future results of the company. These statements are subject to the risks and uncertainties described in the company's earnings release and other filings with the SEC. Thrive has no obligation to update the information presented on the call. Also on today's call, our speakers will reference certain non-GAAP financial measures, which we believe will provide useful information for investors. Reconciliations of those measures to GAAP will be posted on the investor relations website. With that introduction, I would like to turn the call over to Joe Walsh.

Thank you, Cameron. And good morning, everyone. Welcome to our third quarter earnings call. We made excellent progress on our strategic priorities that enable this quarter's performance and our strong progress year to date. As a result, we're raising our full year guidance once again. Paul will provide further details about our financial results and the future outlook. Let's jump into the highlights of Q3. DAS revenue of $56.6 million was up 26% year over year and 8% sequentially ahead of our guidance. For the second quarter in a row, we've kept a balance between subscriber growth and ARPU growth with both in double digits. This is a direct result of our important recent initiatives, including investing in our product, engineering, and client success teams. This growth has been bolstered by the digital transformation trends that we feel continuing to accelerate in the market, this golden age of SMB SaaS. We feel like this is the decade that SMBs are migrating into the cloud, and they're looking for a complete platform like Thrive offers. This is a mega trend that we're riding. So growth has been solid. We've also been able to achieve this in a cost-efficient manner. We've overperformed on SaaS EBITDA. On our Q2 call, we guided our Q3 EBITDA loss around $5 million, and we delivered much better with a loss of $2.2 million. The US is showing profit for the second quarter in a row. EBITDA losses are purely against our international markets, which we're in the process of standing up, which will lead to future SaaS growth. Keep in mind, we're generating a lot of cash flow on the marketing services side of the house, which is where we get the majority of our SaaS customers from. This is that magic, highly efficient model that we have. Sales efficiency is being talked about a lot now. It's being a little bit discouraged to spend wildly to find customers. We have 400,000 existing customers in our base that we're calling on and working with in the normal course. And that's where we get the vast majority of our customers, either directly from there or by referrals from there, delivering that super sales efficiency. Regarding international, we just announced the opening of our regional HQ in Toronto, the hiring of a sales team, as well as key partnerships with Get in the Loop and the Canadian Franchise Association. Canada has around 1.5 million businesses. Marie Caron is spearheading that, our international leader. She's taking that market on and has done an incredible job of getting it kicked off. On the marketing services, we continue to see very predictable performance in billings, which allows us to generate solid cash flow and pay down debt. One other little item I want to mention is that we were named one of the most loved workplaces, which we're really proud of. Overall, I'm super proud of how we're positioned for the balance of the year. With that, let me turn it over to Paul Rouse to take you through our financial results.