PROS Holdings, Inc.

Greetings. Welcome to the PROS Holdings First Quarter 2025 Earnings Conference 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. As a reminder, this conference is being recorded. I would now like to turn the conference call over to Belinda Overdeput, Senior Director of Investor Relations.

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 are also available on our website 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 and guidance. Actual results could differ materially from such statements in our forecast. 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 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. I'm proud to share that our team delivered a strong start to 2025. The broader macroeconomic uncertainty has contributed to a complex selling environment, and our team has executed well through this. We exceeded the high end of our guidance ranges across all metrics, with sales performing ahead of our expectation across B2B and travel. Our trailing 12-month recurring calculated billings grew 14% year over year. or strongest performance on this metric in 10 quarters. At the same time, our team continued to focus on driving greater efficiency, resulting in an impressive 123% improvement in free cash flow year over year. Three key factors are fueling our momentum. First, the ongoing recognition of process and market leader. Second, the proven value of pro solutions made even more critical by the need for visibility and adaptability in volatile markets. And third, accelerating adoption of AI powered pricing and selling solutions. First, ongoing industry recognition continues to reinforce pros leadership position in the market. In Q1, we were named the leader in the Forrester wave for configured price quote solutions, earning the highest possible scores across most of the evaluations criteria. This designation came on the heels of pros receiving leader rankings in the Gartner Magic Quadrant in the IDC market scape for CPQ. Recognition from all three major analyst firms underscores a relentless passion for innovation that drives profitable growth for customers. This continued industry recognition is reflected in the trust global enterprises are placing in pros. I highlight three examples of new customer wins from Q1, among many others. A Fortune 500 chemicals company selected ProSmart CPQ to fuel AI-driven sales transformation, streamlining pricing and sales across global operations to enhance the omnichannel customer experience. Softcat, a leading IT services provider, selected ProSmart CPQ with agreements to increase sales efficiency and support their growth strategy. And Grundfos selected ProSmart price optimization and management to transform global pricing and future-proof their commercial strategy. The second driver of our momentum is continued market volatility. Volatility has been amplified by tariff announcements and evolving trade policies, which are on top of supply chain disruptions, changing customer demand patterns, and currency fluctuation. More and more businesses are realizing market volatility is here to stay in that pros AI powered pricing and selling solutions are mission critical to mitigate risk and outperform the market. Or expansions in Q1 with DigiKey and ADI global distribution are great examples of how companies are taking action. Digikey is expanding their use of PROS by adopting smart price optimization. Digikey's VP of Strategic Pricing, Stefan Bratu, said, and I quote, PROS has been a strategic partner to us for many years. Now, as we adopt PROS AI powered price optimization, it's clear that real-time data-driven decisions are no longer nice to have. they're business critical. In a market defined by volatility, PROS helps us move faster, adapt with confidence, and lead with precision, end quote. ADI global distribution is enhancing its omnichannel pricing strategy by leveraging advanced capabilities, including our Gen 4 price optimization, to deliver accurate, real-time pricing, as well as increased self-service conversion. In the airline industry, PROS empowers carriers to move from reactive to predictive. By identifying demand pattern changes a year in advance, PROS enables airlines to respond proactively and capture new revenue opportunities, which is critical in today's volatile market. As airlines prioritize software optimization and customer experience, the PROS platform delivers the comprehensive capabilities needed to create tailored offers and win in ever-changing market dynamics. We saw strong demand in Q1 in travel, including wins at two of the top seven US carriers by domestic market share, among many others. Southwest Airlines selected PROS Offer Marketing to amplify brand visibility and capture more demand through enriched web experiences. Another domestic carrier expanded its partnership with PROS by selecting PROS Revenue Management Advantage powered by our market-leading AI. PROS will enable this airline to improve demand forecast accuracy and drive a dynamic commercial strategy, positioning them to outperform in this market. The final key momentum driver I'll discuss is the market accelerating adoption of AI powered solutions. As a pioneer and leader in AI, we're not just keeping pace with the market. We're extending our leadership position by advancing autonomous AI to help organizations execute faster, smarter, and with greater precision. True to our longstanding principles, PROS takes a responsible approach to AI innovation, prioritizing transparency, ethics, compliance, and trust. By combining agentic AI with our predictive and prescriptive capabilities, we're enabling intelligent, self-directed systems that augment employee productivity and improve customer experience. This unified approach positions pros at the forefront of a market rapidly shifting towards AI-driven outcomes. and towards a future where AI and people work in seamless synergy. We'll be bringing our vision to life at our upcoming Outperform conference, where we'll showcase our latest AI innovations and demonstrate how the combination of agentic, predictive, and prescriptive AI can drive measurable business outcomes. Two of many examples are pros sales agent and pros rebate agent. The pro sales agent assists sales reps in finding the right products for the right customers by serving up tailored product recommendations based on conversational input, while also keeping deals moving forward with real-time actions to overcome stalled moments in the sales process. Proz Rebate Agent uses AI to autonomously create powerful incentives that drive optimized product mix and volumes while improving customer experience. Before I close, I'd like to share an update on my planned retirement. On behalf of the board, I'm excited to announce that Jeff Cotton will join Proz on June 2nd as our next president and CEO. Jeff is a high-impact leader with a proven track record of driving growth and operational excellence at scale in fostering strong customer-centric cultures. His people-first mindset, passion for innovation, and deep commitment to customer value align seamlessly with our strategy and the culture we built at PROS. I've enjoyed getting to know Jeff And I'm confident the future of pros under his leadership. We have an amazing experienced leadership team, the best people in technology in our value proposition has never been more relevant. We're well positioned to capitalize on our large market opportunity. And I look forward to supporting Jeff on a successful transition. Finally, I would like to thank our global team for their passion and dedication to PROS, our customers, and our communities. I'd also like to thank our customers, partners, and shareholders for their continued support of PROS. With that, I will now turn the call over to Stefan to cover our financial performance and outlook.