Sprinklr, Inc.

Greetings. Welcome to Sprinkler's second quarter fiscal year 2026 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to Eric Skrow, Head of Investor Relations.

Thank you, operator, and welcome, everyone, to Sprinkler's second quarter fiscal year 2026 financial results call. Joining us today are Rory Reed, Sprinkler's president and CEO, and Manish Sareen, Sprinkler's 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 fiscal year of 2026, 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. With that, let me turn it over to Rory.

Thank you, Eric, and hello, everyone. It's nice to be with you today. Second quarter total revenue grew 8% year-over-year to $212 million, and subscription revenue grew 6% year-over-year to $188.5 million. We generated a record $38.2 million in non-GAAP operating income, which resulted in an 18% non-GAAP operating margin for the quarter. I want to thank Sprinklr team members from around the globe and our customers and partners for trusting us to help them solve some of their most important business needs. As we disclosed in today's earnings release, our CFO, Manish Saran, will be leaving Sprinklr on September 19th. Manish has been an important member of the executive leadership team, and I want to thank him for his contributions during his three and a half years at Sprinklr. We wish him the best in his future endeavors, And I will assume responsibility for the financial organization on an interim basis while we finalize the search for our next CFO. I'll now move to an update on our Sprinklr transformation. At Sprinklr, we want our customers to leverage our technology to reimagine how brands connect with people making every experience extraordinary. As I've shared in two previous earnings call, Fiscal year 26 is a transitional year for the company, and I'd like to provide you with an update on our progress. To date, we have largely completed phase one of the transformation, which has been focused on business optimization. We have established a clear ambidextrous strategy, implemented a new business management system, optimized our cost structure, realigned our go-to-market coverage model, and strengthen our product delivery roadmaps. This is the foundation from which we intend to strategically invest and efficiently run Sprinklr to improve our business and better serve our customers. Given the scope of this necessary and wide-ranging transformation, we anticipated some near-term challenges, especially during the first half of this year. as we've implemented a series of strategic and operational changes to directly address past execution issues and to position the company for the long term. As a team, we've tackled these challenges head on, and we're making good progress. but we still have more work to do across our business to elevate the consistency of our execution, improve the predictability of our results, and drive durable growth. We are now entering the second phase of our transformation, the transition phase, which we anticipate will continue through the back half of FY26 and into FY27. This is where we will see many of these actions noted above flow through and shape our business practices and the culture of the company. Building on our progress to date, and as we've stated on prior earnings calls, we are making incremental investments here in the second half of fiscal year 26 to continue to meet the needs of our customers. These investments are designed to extend the enterprise leadership of our platform across both core and sprinkler service. Some of these target investments include, one, the acceleration and deployment of AI functionality and marketing insights and CCaaS products. Two, the addition of more channels and enhanced video capabilities to our leading core suite. And three, we're adding more in-region technical and implementation skills to the go-to-market motion to bring us closer to our customers. We are also continuing to strengthen our leadership team with individuals deeply experienced in driving exceptional customer experiences at scale. In August, we hired Bitt Rambush as our new head of global services and support. reporting directly to me. Bitt joins us with more than 25 years of experience, most recently as the Senior Vice President at Philips Healthcare, where he led an organization of over 3,000 people responsible for all facets of customer relations and retention throughout the customer lifecycle. Furthermore, as you saw in today's earnings release, I'm happy to announce that we have hired Scott Millar as our Chief Revenue Officer. With more than 30 years in the tech industry, Scott brings a proven track record of driving growth and a passion for building high-performing teams. Most recently, Scott served as the Senior Vice President, Global AI Sales at Dell Technologies, where he led a $15 billion revenue organization driving some of the largest AI deployments globally. Scott's arrival marks a pivotal moment for Sprinklr as we sharpen our go-to-market strategy and position ourselves to accelerate the path forward. Bitt and Scott are seasoned technology executives who bring proven expertise, leadership capabilities, and experience delivering strong results at scale, which we believe will help accelerate our transformational journey. Let's now turn to our business execution. As I covered in the first quarter earnings call, we have seen some longer sales cycle and continued scrutiny of enterprise spending. This heightened scrutiny, coupled with inconsistent operational execution and lingering technical debt from the past several years, continue to pressure our renewal cycle. Churn is a major focus for us, and to address this directly, we have been working hard to clean up and fix troubled engagements for those customers who have experienced past implementation and execution issues. This leads us to Project Bear Hug, our key back to the field initiative to combat and help minimize churn, which we launched back in March. Project Bear Hug is focused on deeply engaging our top 700 customers who collectively represent more than 80% of our total revenue. Through the first half of this year, We've had detailed engagements with nearly half of these customers and have established a regular cadence with scores of our top customers. One of those customers recently quoted, the whole experience with Sprinklr feels seamless, easy, connective. Our Sprinklr team operates like an extension of our internal teams. We share goals and ideas, and they're just as impacted by our struggles and excited about our wins as we are. This is exactly the type of experience we are striving to deliver every time, every day. As part of our go-to-market transformation, we're aligning our products to where they fit best and where we believe we have a disproportional ability to win and expand with customers. We believe Sprinklr delivers the most value to scaled global enterprises. We will focus on these enterprise customers who can best leverage the breadth and depth of our AI-native unified platform. We are encouraged by the early results of Project BearHug, which is enabling us to cultivate stronger relationships with the C-suite better understanding of our customers' priorities, and to demonstrate Sprinklr's powerful value. Let me now pivot to our technology and product innovation, which is fundamental to what we do at Sprinklr. We believe our unified platform enables our customers to provide consistent, personalized, and data-driven customer experiences. As we had mentioned earlier in the year, we have now launched our new core pricing and packaging for new logos. This is a hybrid model consisting of seat-based pricing and a commitment model based on consumption. We believe these simplified new bundles will enable us to deliver more transparency and feature sets that help unlock the value and power of the Sprinklr platform for our customers in an easier, seamless way. We also understand that companies are working to determine how to successfully deploy AI technology to help their teams move faster and elevate customer experiences. By investing and developing robust AI features and offerings, we are helping our customers realize the impact of AI in a truly meaningful way. This type of innovation leadership is not new to Sprinklr. Sprinklr is an AI native platform that is purpose built for customer experiences with dozens and dozens of industry and application integrations. Backed by over a decade of expertise in analyzing complex structured and unstructured data sets, Sprinklr combines domain-specific and generative AI to power use cases, agents, copiles that augment teams and unlock intelligent collaboration. This helps to drive efficiency and scale across our customers. Our AI is grounded in our customers' business context, evolving alongside their teams while maintaining the highest standards of security, transparency, governance, and trust. Our advancements in AI are fueling enterprise wins and improving customer satisfaction. Here are just a few of upcoming developments on our R&D front. With the latest enhancements of our customer feedback management or CFM product, Sprinklr will provide customers with a unique ability to leverage AI to analyze structured and unstructured customer feedback from numerous data sources, social, reviews, blogs, surveys, voice, and chat transcriptions through one unified AI taxonomy all on one platform. Additionally, Upcoming product releases will further enhance our ability to disrupt that scale and deliver the technology teams need to reimagine the customer journey. First, sprinkler AI agents or our agentic AI offering help brands scale 24 by 7 customer support, reduce cost, and boost efficiency across channels. Built on our powerful AI and designed specifically with key personas and customer workflows in mind, they are designed to help ensure fast, consistent, improved service experiences. And secondly, our agent co-pilot is an intelligent assistant powered by Sprinkler AI+. designed to streamline and elevate the customer service experience by supporting live agents with task automation and quick insights. We are encouraged by the impact that these technologies are having on our customers based on the uptake and usage of our early users. We believe these updates and our continued investments will help our customers see faster time to value, deepen confidence in our shared solutions, and unlock expansion opportunities aligned to our customers' critical priorities. As such, we're making targeted investments in infrastructure and implementation services to support our AI and service offerings. We are starting to see the positive impact of our investments, results from products bear hug, and our focus on execution culminating in recent customer wins. In 2Q, we continued landing and expanding with many iconic brands. As of July 31st, we have now 149 customers generating at least $1 million in annual subscription revenue, which is an additional three companies from our last quarter. So now in closing, we're making progress on our transformational journey as we're building a better sprinkler that best serves our customers. As we all know, transformations of this scale take time, and we have more work to do to properly execute this program. Churn remains a challenge for us, and improving our retention rate is a key priority. We're seeing early indication of better engagement and improving customer satisfaction based on my personal interaction with hundreds of customers and partners over my first nine months. We now have better analytics to help guide our actions, drive deeper customer impact, and improve our business predictability. We've taken an ambidextrous approach to re-energize and grow our leading sprinkler core while we harden and expand our disruptive sprinkler service solution in our march toward the Rule of 40. We believe the investments we are now making and our continued focus on improving execution should begin to show a bend in our business over the next few quarters. Now I'd like to turn the call over to Manish to go through the numbers in a bit more detail. Manish?