Ooma, Inc.

Ladies and gentlemen, thank you for standing by and welcome to the UMA first quarter fiscal year 2023 financial results call. 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, please press star followed by the number one on your telephone keypad. If you would like to withdraw your question, again, press star one. Thank you. Matt Robison, you may begin your conference.

Thanks, Josh. Good day, everyone, and welcome to the first quarter fiscal year 2023 earnings call of UMA, Inc. My name is Matt Robinson, UMA's Director of IR and Corporate Development. On the call with me today are UMA's CEO, Eric Stang, and CFO, Shig Hamamatsu. After the market closed today, UMA issued its first quarter fiscal year 2023 earnings press release. This release is also available on the company's website, UMA.com. This call is being webcast live and is accessible from the a link on the events and presentations page of the investor relations section of our website. This link will be active for a replay of this call for at least one year. A telephonic replay will also be available for a week starting this evening about 8 p.m. Eastern time. Dialing information for it is included in today's press release. During today's presentation, our executives will make forward-looking statements within the meaning of the federal securities laws. Forward-looking statements generally relate to future events or future financial or operating performance. Our expectations and beliefs regarding these matters may not materialize and actual results are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include those set forth in the press release we issued earlier today and those risks more fully described in our filings with the Securities and Exchange Commission. The forward-looking statements in this presentation are based on information available to us as of the date hereof, and we disclaim any obligation to update any forward-looking statements except as required by law. Please note that, other than revenue or as otherwise stated, the financial measures to be disclosed on this call will be on a non-GAAP basis. The non-GAAP financial measures are not intended to be considered in isolation or as a substitute from results prepared in accordance with GAAP. A discussion of why we present non-GAAP financial measures and a reconciliation of the non-GAAP financial measures discussed in this call to the most directly comparable GAAP financial measures is included in our earnings press release, which is available on our website. On this call, we will give guidance for second quarter and full year 2023 on a non-GAAP basis. Also, in addition to our press release and 8K filing, the overview page and events and presentation page in the investors section of our website, as well as the results page of the financial info section of our website, include links to information about costs and expenses not included in our non-GAAP values and key metrics of our core subscription businesses. These are titled Supplemental Financial Disclosure 1, and supplemental financial disclosure too. Additionally, our investor presentation slides include GAAP to non-GAAP reconciliation that also provides resolution of GAAP expenses that are excluded from non-GAAP metrics. Now, I will hand the call over to UMA CEO, Eric Stang.

Thanks, Matt. Hi, everyone. Welcome to UMA's Q1 fiscal year 2023 earnings call. Thanks for joining us. This is an exciting time for UMA as we pursue several important growth initiatives And it's my pleasure today to review with you our strong QM results and our plans looking forward. Our results for Q1 once again exceeded expectations on both the top line and bottom line. Q1 revenue was $50.3 million. Non-GAAP net income was $3 million. And cash increased in the quarter to $31.8 million. We're happy to be off to a good start on our fiscal 2023 year. During Q1, we made strong progress expanding our sales and marketing resources and driving business user growth. We added approximately 50 headcount to our sales and marketing team, with most of these additions coming on board late in Q1. We also engaged with over 150 new VARs and agents. As we expected, our introduction of UMA Airdial is a new and exciting offering for resellers and is helping us expand relationships in the reseller community. For Q1, we grew our business user base by approximately 12,000 users, which is a rebound from the last couple quarters. Along with this, our pipeline of opportunity grew as well. We are encouraged by these accomplishments as we look ahead to the rest of this year. Our progress with UMA Office Pro and our recent launch of UMA Office Pro Plus also give us confidence as we look ahead. Our take rate for Office Pro amongst new customers ticked up in Q1 to 49% of new users. Across our installed base, we now have over 24% of users taking the Pro tier. And we just launched Office Pro Plus, which brings customers exciting new features and should serve to expand our opportunity and addressable market. Office Pro Plus completes our Office lineup which now consists of Office Essentials at $19.95 per month, Office Pro at $24.95 per month, and Office ProPlus at $29.95 per month. With ProPlus, customers can now take advantage of typically larger business features while continuing to benefit from the turnkey, easy-to-use Office platform. ProPlus today brings call queuing, for satisfying basic call center needs, hot desking to facilitate hybrid work environments where phones are shared, Salesforce integration, so ProPlus features can be used from within Salesforce, and more. Moreover, as we also did after launching Office Pro, we intend to add to the ProPlus feature set over coming quarters. UMA Enterprise made progress in Q1 as well, particularly in the select verticals we are targeting. We closed 16 new deals in the hospitality vertical, a step up versus Q4. These deals included wins with both small and larger sized hotel properties. We also continued our growth with franchises of a large services firm, where we now serve over 6,000 franchise users nationwide. Regarding further development of UMA Enterprise, we have an ongoing effort, as we've discussed previously, to modernize the ways our users interact with our solution. In Q1, we released new mobile apps, and we remain on track to complete our update of UMA Enterprise's desktop app and admin portal in the first half of this year. We are also on track with our rollout to additional users at our largest customer. Late in Q1, we began the rollout in earnest and we ended Q1 with about 27,000 users with this customer. We are currently expanding quickly and expect to onboard 8,000 or more additional users with this customer in Q2, on the way to our goal of adding 25,000 users during this fiscal year. Our expansion opportunity spans both North America and Europe, In Europe specifically, we now serve users located across 13 countries, our most yet with this customer. As you'll recall, UMA Airdial is our new solution for customers replacing aging and costly copper line. Airdial launched in Q1 and is rapidly gaining interest by reseller agents, SELEX, and select strategic partners. With tens of millions of copper lines now in use in the U.S., we believe the market opportunity for Airdial is massive. To provide some perspective, AT&T announced that they expect to sunset 50% of their copper network by 2025. Moreover, customers have shared with us that the price they pay for individual copper lines has in some cases doubled or more over the last year alone. One customer, for example, reported their bill jumped from $105 per month a year ago to $506 per month now, and that's for one copper line. Generally, copper lines at customers that we used to see costing $80 to $120 per month, we now see costing $120 to $300 per month. If nothing else, Luma Airdial, which is priced similarly to our other business offerings on a per-user basis, provides customers a great financial incentive to make the switch. In Q1, we released the Airdial Remote Device Manager, and we are currently working on several additional Airdial enhancements. So far, our supply has been limited, but we are cautiously optimistic that we can build enough Airdial units this quarter to ramp up sales. In addition, our initiatives to capitalize on the trend to wireless internet continue to move forward. Sales of UMA Connect 4G wireless internet in Q1 were our strongest yet. As we've discussed before, we are finding success with businesses whose only fixed internet option is low-grade DSL, and also with businesses who have a critical need for a second backup internet service. Similarly, sales of UMA Tello, driven by our partnership with T-Mobile, who as you know is offering Tello as an add-on to their home wireless internet, sales grew in Q1 as T-Mobile's marketing initiatives started to take hold. In Q2, we anticipate T-Mobile will implement additional marketing initiatives. Finally, I'd like to highlight the announcement we made in March that UMA, for the ninth year in a row, won PC Magazine's prestigious Business Choice Award for Best VOIP System. This award is determined from the magazine's annual business choice surveys of its readers. So we find it especially gratifying that UMA once again emerged as the top provider. We believe this demonstrates that our strategy to provide a unique combination of advanced features, superior ease of use, and uncommon value is resonating with customers. I'll now turn the call over to Shig Ahabamatsu, our CFO, to discuss our results and outlook in more detail and then return with some closing remarks.