Altigen Communs Inc

Greetings. Welcome to Altogen Technologies' third quarter fiscal year 2024 results conference call. At this time, all participants are in 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, Carolyn David, VP of Finance at Altogen Technologies. You may begin.

Thanks, Paul. Good afternoon, everyone, and welcome to Altogen Technologies' earnings call for the third quarter fiscal 2024. Joining me on the call today is Jerry Fleming, President and Chief Executive Officer, Joe Hamblin, Chief Digital and Transformation Officer, and I'm Carolyn David, Vice President of Finance. Earlier today, we issued an earnings release reporting financial results for the period ended June 30, 2024. This release can be found on our IR website at www.altagen.com. We have also arranged the replay of this call, which may be accessed by phone. This replay will be available approximately one hour after the call's completion and remain in effect for 90 days. This call can also be accessed from the investor relations section of our website. Before we begin our formal remarks, we need to remind everyone that today's call may contain forward-looking information regarding future events and future financial performance of the company. We wish to caution you that such statements are just predictions and actual results may differ materially due to certain risks and uncertainties that may pertain to our business. We refer you to the financial disclosures filed periodically by the company with the OTCQB over-the-counter market. Specifically, the company's audited annual report for the fiscal year ended September 30, 2023, as well as the safe harbor statement in the press release the company issued today. These documents contain important risk factors that could cause actual results to differ materially from those contained in the company's projections or forward-looking statements. Autogen assumes no obligation to revise any forward-looking information contained in today's call. In addition, during today's call, we will also be referring to certain non-GAAP financial measures. These non-GAAP measures are not superior to or a replacement for the comparable GAAP measures. However, we believe these measures will help investors gain a more complete understanding of results. A reconciliation of GAAP to non-GAAP measures and additional disclosures regarding these measures are included in today's press release. With that, I'll now turn the call over to Jerry for opening remarks. Jerry?

Thanks, Carolyn, and good afternoon, everyone. Thank you for joining us for today's call. I'm pleased to share our third quarter fiscal results as well as to provide you with an update on our business progress. After my overview, Joe Hamblin, our Chief Digital and Transformation Officer, will expand upon our business execution strategies and operational excellence initiatives. Carolyn will then present an in-depth review of our third quarter financials. Earlier today, we announced our fiscal Q3 2024 revenue of $3.3 million, which was approximately 2% lower compared to our prior quarter, generally due to a decline in our legacy business. On a positive note, Our third quarter operating income was $68,000 compared to a loss of $241,000 in our fiscal second quarter. The reduction of just over $300,000 in operating expenses is a direct result of our operational excellence initiatives. On our last call, we committed to achieving profitability by our fiscal 2024 year end. I'm happy to report that we accomplished this objective one quarter earlier. I'll now turn to a discussion of our business transformation initiatives. First, revenues from our legacy on-premises PBX business declined quarter over quarter as expected since we no longer provide enhancements to our on-premises PBX systems as we have a new cloud-based unified communications platform. Many of these customers have therefore chosen not to renew their software maintenance contracts. We've also had a few customers elect not to renew their contracts for the cloud version of MaxCS also based on our legacy PBX platform, which is admittedly lacking modern unified communications functionality. These issues are resulting from the fact that our new max cloud UCAS or unified communications platform has taken longer than expected to get to full release date due to a few nagging technical issues. Those issues have now been addressed. And as a result, we are finally beginning to see some traction with max cloud. Although the MaxCloud revenues have not yet fully replaced the decline we've experienced in our legacy PBX revenues, we are confident that this will soon change going forward. These same issues have also impacted the timelines for Fiserv to begin migrating their legacy MaxCS customers to the new MaxCloud UC platform. But with those issues now behind us, Fiserv has committed to begin their customer migrations from our legacy MaxCS to the new MaxCloud UC platform, which will generate additional MaxCloud incremental monthly revenues. As I mentioned on last quarter's call, Fiserv is still on track to launch our groundbreaking new conversational AI IVR solution in October. This new solution includes significant enhancements in functionality along with higher pricing, which therefore will also begin to contribute to new incremental monthly cloud revenues. Shifting to Altogen solutions for Microsoft Teams, that business has been fairly flat in the last few quarters as we have not yet been able to introduce a viable contact center solution for Microsoft Teams. However, just last month, we were able to introduce our new Core Engage for Teams contact center platform. We've already signed contracts with several customers and have quite a few pilots taking place now with new prospective customers. Early indications are that this will prove to be a very successful successful commercial endeavor for us. Our consulting services business has continued to grow, primarily as a result of the expansion of our business with the Connecticut Department of Transportation. In addition to that, we are gearing up to go after new customer logos principally focused on AI and digital transformation services. I'd also want to clarify the role our consulting services business has in our overall business strategic planning. I'll start with a brief background. We initially acquired Zach Consulting in May 2022 to increase our Microsoft technical expertise, to extend our capabilities, to deliver custom communication solutions, and to drive all digital software sales into Zach's customer base. While the acquisition certainly improved our Microsoft technical expertise, it also set us back as many of the companies Zach represented as ongoing customers had either ceased doing business or were in the process of doing so at the time of the acquisition. The result was, as reported in prior quarters, a much lower-than-anticipated contribution from the ZACT Services Group. However, when we brought in Sharique Shaikh to run the ZACT Consulting Division in November of 2023, along with the signing of a major contract extension with the Connecticut Department of Transportation in December of 2023, that situation began to change. Today, our consulting services business is not only thriving under Shari's leadership, but we are also now converging the technical resources on the consulting services team with the Altogen software solutions team. This is particularly evident in our AI initiatives in which companies first want custom solutions built for their unique needs, then want Altogen to enhance and maintain those solutions in a monthly recurring managed services revenue model. We're set up to do just that. With that, I'll now hand the call to Joe Hamblin to provide additional color on both our software solutions and consulting services lines of business. Joe?