TriNet Group, Inc.

Good morning and welcome to the TRINET first quarter 2024 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Alex Bauer, Investor Relations. Please go ahead.

Thank you, Operator. Good morning. My name is Alex Bauer, and I am Trinet's Head of Investor Relations. Thank you for joining us, and welcome to Trinet's 2024 First Quarter Conference Call. I am joined today by our President and CEO, Mike Simons, and our CFO, Kelly Tuminelli. Before we begin, I would like to address two items. First, for the first time, we are presenting our financial results pre-market on a Friday. Please note that the change this quarter was due to our internal calendar and our desire to reach the broadest audience possible. Second, I'd like to address our use of forward-looking statements and non-GAAP financial measures. Please note that today's discussion will include our 2024 second quarter and full-year financial outlook and other statements that are not historical in nature or predictive in nature or depend upon or refer to future events or conditions such as our expectations, estimates, predictions, strategies, beliefs, or other statements that might be considered forward-looking. These forward-looking statements are based on management's current expectations and assumptions and are inherently subject to risks, uncertainties, and changes in circumstances that are difficult to predict and that may cause actual results to differ materially from statements being made today or in the future. Except as may be required by law, we do not undertake to update any of these statements in light of new information, future events, or otherwise. We encourage you to review our most recent public filings with the SEC, including our 10-K and 10-Q filings, for a more detailed discussion of the risks, uncertainties, and changes in circumstances that may affect our future results or the market price of our stock. In addition, our discussion today will include non-GAAP financial measures, including our forward-looking guidance for adjusted net income per diluted share. For reconciliations of our non-GAAP financial measures to our GAAP financial results, please see our earnings release, 10-Q filings, or 10-K filing, which are available on our website or through the SEC website. With that, I'll turn the call over to Mike. Mike?

Thank you, Alex, and thank you to our shareholders, analysts, colleagues, customers, and all others joining us this morning. I am excited to lead my first earnings call as CEO of Trinet, and will center my initial comments on two topics. First, thoughts on our first quarter performance, and second, my initial impressions after working alongside our customers and my Trinet colleagues over the past 10 weeks. Reflecting on our first quarter performance, Trinet continued to execute well in the areas most within our control, most notably new sales, retention, and expense management. We maintained our recent strong sales momentum and grew 50% year-over-year in the first quarter, historically our largest sales quarter of the year. Our strong first quarter sales performance reflected a broad team effort across our organization. We are delivering a differentiated offer to the market and a strong onboarding experience for our new customers. At Trinet, we work hard to understand the evolving needs of small to mid-sized organizations in the industry verticals we target. And we apply that insight to deliver services and access to benefits designed with their unique needs in mind. Owning our own technology allows us to operate with this unique vertical focus and do so while capturing the benefits of scale. Our investment in expanded distribution, both the growth and maturation of our sales consultants, and the growing momentum with channel partners allowed us to capitalize on our differentiated offering. In fact, in the first quarter, we benefited from both a 28% year-over-year growth in tenured reps and a similar percentage productivity improvement amongst those same mature reps. Of course, our unique offering helps us not only win new business, but retain our existing customers as well. With a strong multi-year positive trend in net promoter score, our retention improved by over two points versus the first quarter a year ago. As a result of our strong new sales and retention, we nearly achieved positive sequential core worksite employee growth in the first quarter. This is an important achievement to highlight. Trinet came very close to replacing first quarter attrition with new sales additions. And when we think about opportunities for accelerating our growth at Trinet in the coming years, offsetting attrition with new sales is a large and obvious objective to target, and one I think we should expect to consistently achieve. Once new sales is offsetting attrition, positive CIE which is natural growth within our existing customer base, becomes entirely upside. Furthermore, we would expect to achieve this objective while maintaining our pricing and expense discipline, just as we did this past quarter and in previous years. I do want to underscore this last point. As we embark on this effort, we will maintain our financial discipline, we will not be trading on disciplined pricing for growth, and we will remain focused on driving efficiency in all parts of our operations. While I was pleased with our operational performance and how our offering is resonating in the market, the broader economic environment still remains challenged for SMBs. We saw this economic reality impact us in two ways, through our customers hiring and normalization of insurance costs. In the aggregate, net customer hiring was slightly negative, performing similarly to last year's first quarter and to many of the hiring trends we've experienced since 2022. Ultimately, we firmly believe that pursuing business in our chosen core verticals with disciplined pricing is the right long-term approach. And as hiring improves, particularly in the technology industry, TriNet should receive outsized benefits from our differentiated model. Secondly, the broader market continues to experience health cost increases. We, too, saw an increase in health costs in the first quarter. We experienced some claims variability within the quarter. And while Kelly will provide more details in a minute, I would stress that we have a strong model in place to manage risk, and we are uniquely advantaged in our ability to reprice as necessary for these costs, with cohorts available each quarter. Finally, before passing the call to Kelly, I want to finish my prepared remarks by sharing two initial impressions from my first couple of months at Trinet. First, Trinet operates in a very attractive market. Since joining the company, I've spent considerable time with customers and channel partners. Without exception, these visits confirm that the challenges facing small to medium-sized businesses are very real, whether they're working to attract great talent deal with cost inflation, or stay in compliance with an ever more complex regulatory landscape, the need for what we do is significant and it's growing. With this as a backdrop, it's not surprising that PEO industry awareness has never been higher. And I'm pleased to report that recent third-party survey work confirms that Trinet's brand in our target market is now amongst the most recognizable in the HCM space. Our product is resonating as evidenced by our sales and retention performance, and ultimately, in this attractive market, we can and will do more to grow and capture share. My second impression relates to what I found within Trinet. Thus far, I've had the opportunity to meet with literally thousands of my colleagues across the country. This has been an energizing experience, to say the least. Trinetters have not been shy with their recommendations and feedback. And I was so pleased to hear a great many ideas on how we can improve our processes, better leverage technology, and expand our offering for the benefit of our customers. Ultimately, the overwhelming theme which emerged is a genuine passion for serving our customers. The customer is truly at the center of everything we do and it shows. One of the great legacies of my predecessor. I share these two impressions with you, the growth opportunity for PEO and the engagement of my colleagues, because over the next few quarters, TriNet will embark on a review of our strategy with the intent of further aligning our considerable resources with the biggest opportunities for profitable growth. To successfully embark on this review and ultimately to execute, you need colleagues ready, willing, and able to deliver on the underlying drivers of the plan. I believe we have that team here at Trinet, and I'm excited about what we will accomplish together. Now I'll pass the call to Kelly for the financial review. Kelly?