Veritone, Inc.

Good morning and welcome to the Veritone, Inc. Third Quarter 2023 Financial Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal 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 then one on your telephone keypad. To withdraw your question, please press star, then two. Please note that this event is being recorded. I would now like to turn the conference over to Stefan Norbom of Investor Relations. Please go ahead.

Thank you and good morning. Before the market opened today, Veritone issued a press release announcing results for the third quarter ended September 30, 2023. The press release and other supplemental information are available on the investor section of Veritone's website. Joining us for today's call are Veritone CEO and President Ryan Steelberg and CFO Mike Symmetra, who will provide prepared remarks, then open the call up for a live question and answer session. Please note that certain information discussed on the call today, including certain answers to your questions, will include forward-looking statements. This includes, without limitation, statements about our business strategy and future financial and operating performance. These forward-looking statements are subject to risks, uncertainties, and assumptions that may cause actual results to differ materially from those stated. Certain of these risks and assumptions are discussed in Baritone's SEC filings, including its annual report on 410K. These forward-looking statements are based on assumptions as of today, November 8, 2023, and Veritone undertakes no obligation to revise or update them. During this call, the actual and forecasted financial measures we will be discussing include non-GAAP measures. Reconciliations of these measures to the corresponding GAAP measures are included in the press release we issued today. Also, when we reference pro forma measures, such measures are presented on a combined pro forma basis treating broad bean as owned by Baritone during fiscal year 2022. Finally, I would like to remind everyone that the call today is being recorded and will be made available for replay via a link on the investor section of Baritone's website at www.baritone.com. Now I'd like to turn the call over to our CEO and President, Brian Stielberg.

Thank you, Stefan, and thank you everyone for joining us today. Before turning to third quarter earnings, business highlights and results, I want to provide an update on our strategic initiatives and discuss Veritone's positioning in the current operational landscape. Exactly a year ago, Veritone announced my appointment as CEO, and I introduced several strategic initiatives, including focused execution, operational excellence, and fiscal responsibility to accelerate our path to profitable growth and drive long-term shareholder value. I continue to be impressed with our team's progress against this framework. Despite lingering uncertainty across financial and consumer markets, Veritone has made significant strides in streamlining operations, and we look to the start of 2024 as an inflection point in our growth trajectory. Veritone has intensified its focus on the verticals we serve, allocating our resources to establish markets where we have demonstrated differentiation and strong product market fit. We took swift action to reshape our organization in pursuit of operational excellence, aligning Veritone's go-to-market strategy and purpose-built applications to solve critical problems for our customers, enabling them to cut costs, streamline operations, and boost revenue streams. Even amidst the difficulties posed by the challenging macroeconomic environment, our customers are affirming the value of our services by choosing to extend their contracts. Fairtone's recent award by Deloitte as a member of its 2023 Technology Fast 500 class underscores our position as a top innovator and high-growth company in North America across various sectors. In addition to operational changes, Fairtone's dedication to fiscal responsibility resulted in $24 million in annualized savings year-to-date, and we expect to realize more as we progress to the end of the year. As signaled last quarter, Fairtone is taking decisive action to improve our liquidity position, restructuring our debt and adding $40 million in net new cash to our balance sheet, while also extending a major portion of our debt to 2027 maturity. Mike Zimetra will provide further information and details on the debt restructuring later. As we approach the conclusion of 2023, I remain confident in our path forward and the strategic value of our products and services, as well as the enduring growth potential of our business. According to Goldman Sachs research, companies involved in the AI ecosystem can be classified into two distinct groups, enablers, who make cognitive and generative AI possible, or empowered entities that harness the power of cognitive and generative AI to grow stronger. As enterprises increasingly seek to deploy AI solutions faster than ever before, they face unique challenges in integrating and productively managing the growing sea of disparate data, as well as the AI models they utilize. By leveraging Veritone's proprietary AIWare platform, our integration capabilities, and our established partnerships, we support AI-empowered companies in implementing cognitive and generative AI into their key business lines and work productivity tools. Veritone is an enabler, and we are committed to advancing human potential by blending human expertise with AI technology, helping organizations solve problems and achieve more than ever before. Next, I'll highlight our progress in each of our core go-to-market verticals, talent acquisition, media and entertainment, and public sector industries. First, FairTelens hiring platform. Last quarter, our strategic acquisition of Broadbean further solidified our positioning in a talent acquisition industry. These solutions offer substantial customer improvements to hiring performance, resulting in higher ROI and accountability, while also enabling faster and more efficient hiring processes. In Q3, we made substantial progress integrating Broadbean with Veritone and expect to complete this integration in early 2024 and subsequently start realizing anticipated synergies in the first half of 2024. To that point, I'm excited to report that we have successfully integrated the sales and marketing organizations and have begun upselling Veritone programmatic solutions to the legacy Broadbean customer base. We remain committed to diversifying our customer and revenue base, and the notable increase in subscription-based customers this year has contributed to greater stability in revenues and earnings, reducing vulnerability to the actions of a single customer or market segment. Turning to media and entertainment, Veritone remains at the forefront of driving AI innovation in the media and entertainment sector. Our comprehensive range of services spans content and advertising analytics, asset management, licensing, and bespoke cognitive and generative AI solutions. By equipping content organizations and their teams with these powerful tools, we facilitate the swift and efficient management, creation, monetization, and innovation surrounding their proprietary datasets, enabling our customers to meet the ever-growing demand for personalized content and boost their organization's revenue streams. Despite the turbulent environment impacting consumer behavior and the active SAG-AFTRA and recently settled WGA strikes, our customer retention and engagement metrics in media and entertainment remain resilient. During the third quarter, we signed and renewed contracts with leading talent agencies, CAA, United States Tennis Association, NBC Universal, A&E Networks, HBO, and Augusta National. Recently, on the heels of the Women's World Cup, we renewed and extended our long-standing AI and monetization partnership with the U.S. Soccer Federation. Together, we will continue our efforts to oversee licensing rights and optimize content management and monetization with U.S. women's and men's national teams, youth national teams, and extended national teams. Lastly, I am proud to state that we renewed our flagship partnership with iHeartMedia, providing the largest audio media company with Veritone's market-leading AI-based applications and solutions to enable them to continue to drive consumer engagement and ROI for their advertisers. Our media and entertainment platform is well-positioned to capture market share as blue-chip customers turn to Veritone to unlock the unrealized value from unstructured datasets and supercharged human outputs. Finally, I would like to comment on Veritone's public sector business. Our Q3 wins with the Veritone public sector suite of solutions across state and local agencies, education, U.S. Fed civilian, and U.S. Fed DOD Intel showcase our value, focus, and passion for providing AI-powered solutions to address the unique challenges faced by government agencies and legal organizations. As of the end of Q3, Veritone is actively supporting over 325 law enforcement agencies, We are engaged in a new project with a law enforcement organization of a major DOD agency, and we have started a new project with a Fed Civ agency with significant potential that utilizes the Veritone Public Sector product suite. We are thrilled that former Anaheim Police Chief Jorge Cisneros will act as a law enforcement advisor to baritone public sector, working alongside our team to empower law enforcement agencies with the latest AI-driven tools to accelerate investigations, protect personally identifiable information, and improve public safety. In addition, this past quarter, we were selected by the U.S. Department of Justice for a $15 million sole contractor blanket purchase agreement that can be used by all organizations within the DOJ, which will facilitate access to Veritone software and services. Specifically, Veritone will enable DOJ personnel to greatly improve their productivity and proficiency as they investigate, review, and redact unstructured data, including digital documents, audio, and video files. During the third quarter, we also launched a new product, Veritone Evidence, to manage, protect, and share digital evidence amongst and across government agencies. As of last year, more than half of the 100-plus state and local law enforcement agencies were using cloud-based digital evidence management systems or plan to implement these solutions within the next three years. We look forward to growing our public sector customer base as government agencies seek out solutions that rapidly extract actual intelligence from their diverse data sources. Our pipeline continues to grow significantly, and we expect Veritone public sector to deliver nearly 75% to 100% year-over-year growth in 2023 and continue to contribute a greater share of revenue through 2024. As Veritone executes its long-term strategy and embarks on its next phase of growth, I am thrilled to announce the addition of Michael Zillis as an independent director to our board. Michael, who is currently serving as EVP and CFO of Ingram Micro, is an accomplished company executive and dynamic leader who shares Veritone's mission of delivering highly targeted solutions to help companies through technology to unlock operational efficiencies and productivity gains. His financial and international operations expertise will bring a valuable perspective to Veritone's pursuit of operational excellence to prioritize the artificial needs of our customers while driving value for our shareholders. We welcome Michael to the Veritone team. Overall customer growth, booking strength, and an increasingly diverse revenue base demonstrate that Veritone is resilient and poised to accelerate its growth. We anticipate the company-wide financial advantages will become increasingly evident in 2024 with one-time integration and transaction costs behind us. Veritone is on a clear path to profitability, and we look forward to updating you on the progress we are making to unlock long-term value for our shareholders in the quarters to come. Now, I would like to hand the call off to Mike Zimetra, our CFO, to go through the financial results in more detail. Over to you, Mike.