PROS Holdings, Inc.

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. As a reminder, this conference is being recorded. I would now like to turn the conference call over to Belinda Overdeput, Director of Investor Relations. Please go ahead.

Thank you, Operator. Good afternoon, everyone, and thank you for joining us. Our earnings press release, SEC filings, and a replay of today's call can be found on the Investor Relations section of our website at pros.com. Our prepared remarks will also be available on our website immediately following the call and will be replaced by the official transcript, which includes participant questions once available. With me on today's call is Andres Reiner, President and Chief Executive Officer, and Stefan Schultz. Chief Financial Officer. Please note that some of the commentary today will include forward-looking statements, including, without limitation, those about our strategy, future business prospects and market opportunities, and our financial projections. Actual results could differ materially from such statements in our forecast. In particular, there remains significant uncertainty around the duration and impact of COVID-19. This means that results could change at any time, and the contemplated impact of COVID-19 on the company's business results and outlook is the best estimate based on the information available as of today. For more information, please refer to the risk factors described in our SEC filings. PROS assumes no obligation to update any forward-looking statements to reflect future events or circumstances. As a reminder, during the call, we will discuss non-GAAP metrics. Reconciliations between each non-GAAP measure and the most directly comparable GAAP measure to the extent to which available without unreasonable effort are available in our earnings press release. With that, I'll turn the call over to you, Andres.

Thank you, Belinda. Good afternoon, everyone, and thank you for joining us on today's call. As I reflect on 2021, I'm thankful to our team for what we've accomplished despite the disruptions of COVID on our business and our community. ARR increased 9% year-over-year and subscription revenue by 4% year-over-year. Our gross revenue retention rate for the year returned to pre-COVID levels and was greater than 93%. I'm proud to share that we generated over $33 million of free cash flow improvements year-over-year. I'm also pleased that the EveryMundo team joined the PROS family. They share the same passion for innovation and customer success as us. I'm confident that because of our passion for innovation, we have the best digital selling platform in the market. We've been continuously innovating for over 35 years to help our customers today, five years from now, and 10 years from now. In 2021, we continued our heritage of innovation with the launch of the PROS platform. I believe we deliver significantly more measurable ROI than anyone in our market. Value assessment we completed with participation from more than 100 customers showed, on average, 6% revenue improvement from the use of our platform. I also believe that we have the fastest time to value and we're getting faster. Our new prescriptive activation packages helped us drive an 18% improvement in time to value in 2021. In fact, industry analysts have also validated our market leadership position with 15 company awards and accolades in 2021, including leadership positions in G2 for pricing software, the Gartner Magic Quadrant for CPQ, and the IDC Marketscape for B2B price optimization and management. So proud of this recognition of our incredible innovations. In Q4, we welcome new customers adopting the PROS platform. Bbron Medical, a leading manufacturer of medical technology and pharmaceutical products, selected our smart price optimization and management solution. This solution equips Bbron to respond quickly to changing market dynamics, drive higher win rates, and improve revenue and profitability. A rapid time to value and proven record of customer success are key reasons why Bbron selected pros. Rockwell, a manufacturer of stone wool products, also selected pros in Q4. Rockwell will use our smart CPQ solution to streamline their selling process and quickly respond to customer quotes. Our ability to support direct and digital sales was one of the many reasons Rockwell chose pros. We're thrilled to welcome B. Brown and Rockwell, among others, to the PROS family and look forward to partnering with them. The PROS platform is also inspiring existing customers to migrate to the cloud. Clarion, one of PROS' first B2B customers and American standard of customers since 2012, chose to migrate to her smart price optimization and management solution in Q4. We're proud of our partnerships with Clarion and American Standard and look forward to continuing to drive long-term value for their businesses. As a result of the pandemic, businesses around the world are increasingly prioritizing digital initiatives that strengthen direct customer engagement and build loyalty. This is front of mind in the airline industry, where airlines are anticipating bookings through digital direct and Direct Connect NDC channels to grow by 12 percentage points in the next three years, while the bookings through offline GDS and other channels decline. Additionally, airlines' interest in offer personalization has nearly tripled between pre-COVID and the recovery phase. With PROS Dynamic Offers, PROS Digital Retail, and now Digital Offer Marketing Solution, PROS is extremely well positioned to help airlines deliver on these objectives. PROS Dynamic Offers empowers airlines to create, price, and distribute personalized fare, seat, and ancillary offers through any airline web, mobile, or direct connect NDC channels. Pro's digital retail takes the dynamic offer solution one step further by adding our internet booking engine and user interface, giving airlines full control over their customer experience from the offer creation to order management. For example, in Q4, existing customers like Air Europa and Gulf Air expanded their partnerships with us to fuel revenue growth through their digital channels. Requisition of every Mundo's digital offer marketing solution accelerates our vision to optimize every shopping and selling experience. PROS now provides brands greater control over their end-to-end customer journey with more meaningful interactions in the research and shopping phase. These solutions help brands drive more direct customer engagement through dynamic web pages, offer virtualization, and digital ad campaigns. In Q4, AirBaltic and Viewling, among others, selected these solutions to increase website traffic, improve user experience, and drive higher booking conversion rates. Before I transition to our 2022 strategy, I want to comment on our recent organizational change around the removal of the chief operating officer role. This flattened organizational structure will drive greater speed into our business. more consistent execution, and further empowers our teams to drive success. I'm confident that these changes will better position us for long-term growth, and I look forward to working more closely with our amazing team to extend our market leadership position. In 2022, we're continuing to invest in the three key pillars of our strategy. First is driving market adoption of the PROS platform. We're accelerating market adoption by increasing our sales, marketing, and delivery investments. We're going to be bolder in telling our story and sharing our customers' amazing success. Additionally, we're ramping up quota caring personnel and expanding our delivery teams to support our growth. Second, leveraging partnerships to accelerate our growth. We recently announced the expansion of our Microsoft partnership to accelerate mass adoption of the seamlessly integrated Microsoft Dynamics 365 in Pros platform. We're also leveraging our ecosystem of system integrators like EY to increase our global footprint and further capitalize on our growth opportunities. Our final strategic pillar is delivering exceptional value and an incredible experience to our customers. In 2021, our NPS scores reached an all-time high above the industry average, and our gross revenue retention rates significantly improved back to pre-COVID levels. We featured 43 customer speakers during our annual outperform conference. All these data points are a key testament to the strength of our customer partnerships and our passion for customer success. In 2022, we'll build on our team's incredible efforts last year. We're expanding our prescriptive delivery packages to allow our customers to activate more use cases with even faster time to value. We'll also continue to help our customers get best-in-class ROI and accelerate their expansion journeys with our platform. We entered this year well-positioned to accelerate our growth. We have the right people, strategy, and platform to capture this strong market opportunity in front of us. Side close, I'd like to thank our global team for their passion and dedication to driving customer success and broad market adoption of the PROS platform while making PROS a great place to work. Thank you to our customers, partners, and shareholders for your continued support of PROS. With that, I'd like to turn the call over to Stefan to cover financial performance and outlook.