Sprinklr, Inc.

Greetings and welcome to the Sprinklr second quarter fiscal year 2025 earnings conference call. At this time, all participants are in a listen-only mode. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. A brief question and answer session will follow the formal presentation. As a reminder, this call is being recorded. I would now like to turn the call over to Eric Skrull, Vice President of Finance. Thank you, Eric. You may begin.

Hey, thank you, Paul, and welcome everybody to Sprinkler's second quarter fiscal year 2025 financial results call. Joining us today are Raji Thomas, Sprinkler's founder and co-CEO, TRACFAM co-CEO, and Manish Sareen, Chief Financial Officer. We issued our earnings release a short time ago, filed the related Form 8K with the SEC, and we've made them available on the investor relations section of our website, along with the supplementary investor presentation. Please note that on today's call, management will refer to certain non-GAAP financial measures. While the company believes these non-GAAP financial measures provide useful information for investors, the presentation of this information is not intended to be considered in isolation or as a substitute for financial information presented in accordance with GAAP. You are directed to our press release and supplementary investor presentation for reconciliation of such measures to GAAP. In addition, during today's call, we'll be making some forward-looking statements about the business and about the financial results of Sprinklr that involve many assumptions, risks, and uncertainties, including our guidance for the third fiscal quarter and full year of 2025, the impact of our corporate strategies and changes to our leadership, the benefits of our platform, and our market opportunity. Our actual results might differ materially from such forward-looking statements. Any forward-looking statements that we make on this call are based on our beliefs and assumptions as of today, and we disclaim any obligation to update them. For more details on the risks associated with these forward-looking statements, please refer to our filings with the SEC, also posted on our website, including Sprinkler's quarterly report on Form 10-Q for the quarter ended July 31, 2024. With that, let me now turn it over to Raji.

Thank you, Eric, and hello, everyone. Q2 total revenue grew 11% year-over-year to $197.2 million, and subscription revenue grew 9% year-over-year to $177.9 million. We generated $15.2 million in non-GAAP operating income, which resulted in an 8% non-GAAP operating margin for the quarter. Included in these results is a credit loss charge of $10.1 million. Our free cash flow for the quarter was not impacted by this charge. Manish will discuss this topic in more detail during his remarks. As we acknowledged on previous calls, the transformation we're working through will take several quarters. TRAC will discuss the progress we're making and our plan to capitalize on our strengths to re-accelerate growth. Before I hand it over to Trak, I would like to reflect on some recent successes we have achieved. To begin with, Sprinklr's platform has several building blocks that we believe will underpin our turnaround in growth and profitability. We operate in attractive and growing markets and support a gold star list of customers through an AI-powered unified customer experience management platform. We have differentiated leadership position in our core product suites, and we're also an emerging disruptor within the CCAS space, where our product is already top quadrant, generating tangible benefits for our customers. During the second quarter, we added several new customers and expanded with existing ones, such as UBS, Ford, T-Mobile, Grupo Bimbo, and Planet Fitness across all our product suites. Some specific examples include one of the largest global asset managers in the world. At this industry leading company, our platform replaced multiple social tools and point solutions, including an incumbent vendor who was in place for 12 years. Sprinklr is unifying AI powered listening, publishing, engagement, marketing, and customer service across all social channels which will allow these teams to work better together and improve their customers' experiences. Another example is a global EV company who is using our core product suite to support their aggressive launch in multiple countries. This company uses Sprinklr's Insight Suite to understand market opportunities and our social capabilities to market on different channels that may be popular in each country. We're also seeing some remarkable business results as customers deploy our AI capabilities. Notably, with our service suite, a large North American retailer was able to use our AI to increase their call deflection up to 35%. This resulted in an estimated 420,000 fewer calls a year that needed to be handled by expensive agents. Another example is a large global bank that saw their customers' use of AI self-service increase to over 60%. This customer has implemented Sprinklr CCaaS and saw their outbound virtual agent productivity improve by 50% as well. These are just a few recent examples of how our value proposition is resonating with some of the world's largest enterprise customers. In addition to these customer validations, our innovation is also being recognized by industry analysts. In Q2, Sprinklr was named a leader in digital customer interaction solutions, Forrester Wave. As cited by Forrester, and I quote, Sprinklr boasts the most feature-complete solution bar none. We were also named a major player in the 2024 IDC Marketscape for Contact Center as a Service. As you know, we've been building out our executive leadership team. Over the last several quarters, we've attracted and hired leaders who are experts in their fields and are deeply passionate about driving our business forward. One of these leaders is our co-CEO, Trak. I'd now like to invite Trak to share his thoughts on the work we're doing and the improvements we're making here at Sprinklr. Trak, over to you.