RingCentral, Inc.

Greetings. Welcome to the RingCentral fourth quarter 2020 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. Please note this conference is being recorded. I will now turn the conference over to your host, Ryan Goodman. You may begin.

Thank you. Good afternoon and welcome to RingCentral's fourth quarter 2020 earnings conference call. I'm Ryan Goodman, Rank Central's Head of Investor Relations. Joining me today are Vlad Shmunis, Founder, Chairman, and CEO, Anand Ishwan, President and Chief Operating Officer, and Mitesh Dhruv, Chief Financial Officer. Our format today will include prepared remarks by Vlad, Anand, and Mitesh, followed by Q&A. Some of our discussions and responses to your questions will contain forward-looking statements, including our first quarter and full year 2021 financial outlook and our assumptions underlying that outlook. These statements are subject to risks and uncertainties. Actual results may differ materially from our forward-looking statements. A discussion of the risks and uncertainties related to our business is contained in our filings with the Securities and Exchange Commission and is incorporated by reference into today's discussion. In particular, our business is currently being impacted by the COVID-19 pandemic. The extent of its continued impact on our business will depend on several factors, including the severity, duration, and extent of the pandemic, as well as actions taken by governments, businesses, and consumers in response to the pandemic, all of which continue to evolve and remain uncertain at this time. Rain Central assumes no obligation and does not intend to update or comment on forward-looking statements made on this call. Unless otherwise indicated, all measures that follow are non-GAAP with year-over-year comparisons. A reconciliation of all GAAP to non-GAAP results is provided with our earnings release and in the slide deck. I encourage you to visit our investor relations website at ir.rankcentral.com to access our earnings release, slide deck, our GAAP to non-GAAP reconciliations, our periodic SEC reports, a webcast replay of today's call, and to learn more about RingCentral. For certain forward-looking guidance, a reconciliation of the non-GAAP financial guidance to the corresponding GAAP measure is not available, as discussed in detail in the slide deck posted on the Investor Relations website. With that, let me turn the call over to Vlad.

Good afternoon, and thank you for joining our fourth quarter earnings conference call. I would like to start this call with a warm welcome to our newest board member, Secretary Arne Duncan. Arne is the former United States Secretary of Education. Prior to his federal government service, Arne was CEO of Chicago Public Schools for eight years, and he is currently a senior fellow at the University of Chicago Harris School of Public Policy. Welcome, Arnie. Now, Turing Central. 2020 was a transformational year. The global pandemic is fundamentally changing how businesses operate. With the vaccine now being distributed, many businesses are preparing for a hybrid work environment. There are planning for some workers in the office and some at home, for the foreseeable future. As companies adapt to this new work-from-anywhere norm, digital transformation of business communications will become more critical. Enabling this transformation are cloud-based communications solutions. This is essential to enabling employees to productively engage with customers, partners, and peers from anywhere on any device and in any mode. According to Gartner, by 2024, 74% of the new unified communications licenses purchased by organizations will be cloud-based, up from 48% in 2019. Businesses are increasingly turning to RingCentral as a trusted partner in their transition to a cloud-based communications platform. This growing customer demand is evident in our strong and standout Q4 results. Total revenue grew 32% year-over-year to $335 million, an acceleration of two points sequentially. RingCentral Office ARR grew 39% year-over-year to $1.2 billion, an acceleration of three points sequentially. We delivered a record number of $1 million TCV wins, up over 50% sequentially, and we had strong contributions from our key partners led by Avaya, AT&T, and Atos. As we look to 2021 and beyond, we are increasingly confident in the size of the opportunity and market receptivity to our differentiated message, video, phone, or MVP as we call it, and cloud contact center solutions. These together enable us to address the full range of business communications needs for most enterprises worldwide. And now, with the recent addition of RingCentral Glyph, our free, unlimited, smart video meeting solution, we can help even more businesses or their individual departments to communicate in any mode on any device from anywhere. please visit GLIB.com to experience it for yourself. Our leading UCAS solution, RingCentral Office, is an enterprise-proven, carrier-grade, global, trusted, message-video phone or NDP solution. It offers a seamlessly integrated, multi-mode user experience, five-nines reliability, world-class global coverage, and an open platform, all of which we believe are important competitive differentiators. We're also proud to once again be recognized as a leader in the latest Gartner Magic Quadrant for Unified Communications as a Service worldwide report for the sixth year in a row. In addition, RingCentral ranks highest in all five use cases of the 2020 Gartner Critical Capabilities for Unified Communications as a Service Worldwide Report. Leveraging all the strengths of our industry-leading cloud PBX platform, we have recently added RingCentral Video, a new core component of our MVP solution. RingCentral Video is built on the modern WebRTC industry standard framework with numerous proprietary enhancements. We continue to innovate here at a rapid pace. Some of the recent enhancements include virtual backgrounds, closed captions, third-party virtual camera support, and waiting rooms. Earlier this month, We introduced RingCentral embeddable for RingCentral Video, enabling developers to quickly embed video into business applications. And in Q4, we acquired certain technology assets of a company called DeepEffect, a pioneer in AI powered conversational intelligence. DeepEffect will enable us to provide RingCentral Video with new capabilities such as emotional sentiment recognition and multi-speaker identification. To help businesses transition to cloud communication solutions, we recently introduced RingCentral GLIB, our free smart video meeting solution available through our glib.com website. GLIB provides unlimited RingCentral video meetings seamlessly integrated with team messaging capabilities all at no cost this smart meeting solution provides users with the persistent platform for communications before during and after meetings this is an important differentiator from other single mode video solutions available today and of course all of this with RingCentral's carrier-grade quality, security, reliability, and global footprint. Complementing our UCaaS solutions is the RingCentral CCaaS product portfolio. We are seeing strong cloud adoption trends with many customers choosing integrated UCaaS and CCaaS from a single leading provider. Contact Center was included in over 60% of our 1 million TCV wins in Q4, including multiple wins for our native RingCentral Engage Cloud Contact Center platform. We are particularly proud of the recent 2,000 user win that combined RingCentral Office with RingCentral Engage. This major NGO customer will leverage the full power of RingCentral to help people displaced by COVID-19 find new employment. In conclusion, we have a strong, well-differentiated portfolio of industry-leading cloud communications solutions. And over the past several years, we focused on finding new innovative ways to efficiently bring these solutions to global markets. On that note, I'd like to extend my warm welcome to Vodafone Business as our newest key partner. Vodafone is the largest mobile and fixed network operator in Europe. RingCentral will be the lead UCAT offer for Vodafone business install base of over 30 million customers. Vodafone business will also offer RingCentral CCAT customer engagement solutions. RingCentral believes in winning through partnerships. Over the past several years, we've established a unique go-to-market ecosystem of direct, channel, and strategic partnerships. RingCentral is the lead UCaaS provider for Avaya, Atos, Alcatel-Lucent Enterprise, AT&T, BT, TELUS, and now Vodafone Business. This gives us preferred access to over 200 million potential users worldwide. We're humbled and grateful to find ourselves in this unique position. And we're committed to driving a pace of rapid innovation and GTM expansion to continue delivering world-class cloud communication solutions for years to come. With that, I will now turn the call over to our President and Chief Operating Officer, Armand Eswaran, for additional details on our progress and some recent achievements.