Coveo Solutions Inc.

Good afternoon, my name is Konstantin and I will be your conference operator today. At this time, I would like to welcome everyone to the Covio Force Corridor and Full Year 2025 Financial Results Conference Call. All links have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star then the number one on your telephone keypad. If you would like to enroll your question, please press star then the number two. Thank you. I will now turn the line over to Adir Kaveh. You may now begin your conference.

Good afternoon, everyone, and thank you for joining us. With me to discuss Coveo's fiscal Q4 2025 and full year 2025 results are Louis Tetsu, Coveo's Executive Chairman, Laurent Simonot, Co-Founder and Chief Executive Officer, and Brandon Nussie, Chief Financial Officer. A reminder that some remarks made today will be forward-looking statements within the meaning of applicable securities laws. including those regarding our plans, objectives, expected performance, and our outlook for the first fiscal quarter and full year fiscal 2026. These forward-looking statements are given as of May 20, 2025, and while we believe any statements we make are reasonable, they are based on current expectations and assumptions which are subject to risks and uncertainties. Actual results could differ materially from those expressed or implied. Coveo disclaims any intent or obligation to update our forward-looking statements, whether as a result of new information, future events, or otherwise. Further information on factors that could affect the company's financial results is included in filings we make with Canadian securities regulators, including in the risk factors section of the company's most recently filed annual information form, as well as the key factors affecting our performance section of the company's most recently filed MD&A. both of which are available on our CDAR Plus profile at cdarplus.ca and on ir.caveo.com. Additionally, some of the financial measures and ratios discussed on this call are either non-IFRS measures or ratios or operating metrics used in our industry. A discussion on why we use these metrics and where applicable reconciliation schedules showing IFRS versus non-IFRS results are available in our press release and our MD&A issued today. Finally, Please note that unless otherwise stated, all references and financial figures made today are in U.S. dollars. Our presentation slides accompanying this conference call can be accessed on our IR website under the News and Events section. I will now turn the call over to Louis first to review our operational and strategic highlights of our fourth quarter and full fiscal year, followed by Laurent, who will discuss our platform and strategy, and we will end off with Brandon and taking you through the financial details and provide our outlook for Q1 and fiscal 2026. We will then open the line to your questions. With that, Louis.

Thank you, Adir, and we want to thank everyone joining us on the call. We have many exciting things to discuss. First, we're pleased to report another record quarter for Coveo, demonstrating the resilience and profitability of our business model, our robust unit economics, and Coveo's accelerating growth. Our fourth quarter financials reached the upper end of our guidance. Fast subscription revenue hit a new high at 32.6 million U.S. Total revenue climbed to 34.4 million. Adjusted EBITDA was strong at 0.7 million. And operating cash flow for the fiscal year was solidly positive at 11.1 million, ahead of our guidance of approximately 10 million. Our Q4 bookings performance was our best Q4 ever and contributed to more than 50% year-over-year bookings growth during the back half of fiscal 25. Our generative AI customer base increased 30% sequentially and tripled year-over-year. Our strong momentum continued in commerce, which is our fastest-growing customer use case, and finally, Net expansion rate for the core platform rose 200 basis points sequentially to 107%. New customers include DocuSign, Gilevay International, and Agco, and we're continuing to see existing customers expanding their use of our platform, such as Workday, Nestle, Dow Chemical, Arm Holdings, and Cummins. Laurent will share more details. I'm extremely proud of what we've accomplished. and pleased with the acceleration of our market demand. Our ability to deliver both growth and profitability, even amid economic headwinds and AI industry disruption, highlights the uniqueness, enduring value, and scalability of our technology. Since our IPO, our core platform SaaS revenue grew around 70%. We turned losses into positive cash flow, consistently delivering high-margin, scalable growth, and continued to acquire marquee customers. Today, our momentum in the applied AI market is undeniable. Beyond these results is a far more exciting story. The numbers do reflect our financial discipline, but more importantly, they demonstrate Coveo's growing strategic importance and adoption in the enterprise applied AI and generative search space. Transforming digital experiences is a fast-growing application of AI for enterprises, and Coveo leads in enabling this technology. Generative search and relevance is at the core, and our leadership in the space continues to be recognized by key analyst firms like Gartner, Forrester, and IDC. Our revenue growth is accelerating, and the reasons for this are simple – Enterprises must modernize digital experiences. People online will now expect personalized, prescriptive, and now, thanks to generative AI, advisory and agentic experiences. Because all of us are only a browser window away from a smarter, faster, more contextual, and automated experience that gives us back what we value most, our time. Relevance is the key. how products and content align efficiently with a person's context and intent. And AI is the only competitive way to deliver relevance at scale. Hence, in the coming years, integrating AI at every interaction point will be crucial, and companies that fail to embrace these AI-driven experiences will fall behind. AI not only enhances user engagement and people augmentation, but it can also compute for better business outcomes at every interaction. And that's powerful. But there is another reason. We believe enterprises need our technology to make large language models work within new generative digital experiences. You cannot deliver the precise generative experiences enterprise need without unless you ground the LLM prompts in secure and current enterprise data, which is what our AI search technology does. That is regardless of which LLM you use. But in addition, we have built a mature AI stack that turns that data into pinnacle relevance, vital for precise answers and the agentic rag needed to power these experiences. That is what Coveo does uniquely. That is why Coveo is the AI relevance company. We said this a year ago. We published impressive customer results in both our commerce and knowledge lines. We highlighted growing demand and pipeline and noted increased conversion rates when customers measured Coveo against alternatives. And now we're delivering a third consecutive quarter of bookings momentum following the market disruption from Chad GPT. which we continue to believe benefits us. The unique value and differentiation of our technology are now recognized and measured. Coveo's AI relevance and generative search power transformation for some of the world's leading enterprises, including many of the world's top technology companies. We are their AI backbone for hyper-personalized content in areas such as customer service and also high-impact generative search applications. The good news is that IT and business leaders have now gained a good understanding of the why and the how. Buyers are much more knowledgeable about the capabilities and requirements for AI and generative AI. After two years of education, discovery, and experimentation following the launch of ChatGPT, enterprises are now moving from experimentation to adoption. In fact, It is our view that in many enterprises, AI was somewhat of a technology in search of problems. And we're now seeing some AI talk fatigue as business leaders are now anxiously seeking real production applications and tangible ROI from AI. Few companies can deliver and measure ROI. And so Coveo is benefiting from this shift, driving increased demand and adoption. Our goal is quite clear. to build the most trusted brand in our industry, helping enterprises materialize, apply to generative AI across their commerce, websites, service, and workplace knowledge experiences. We aim to capture a significant share of the AI experience economy by maintaining a strong focus on innovation, customer value, and a scalable business model. Our strategy to get there is also clear. We prioritize growth, profitable economics and a high recurring margin, innovation and operational excellence in sales and customer success to scale. To capitalize on our momentum, we're investing more aggressively in rapid innovation, superior customer outcomes, and disciplined data-driven go-to-market strategies. This quarter, again, demonstrates progress on these metrics. Assuming we execute our plans and guidance, These investments will serve to further accelerate our growth, long-term profitability, and continued improvement in our Rule of 40 metrics, such that we expect to approach 30 on that metric by year-end on an ARR growth and operating cash flow basis. While we anticipated this success, some investors questioned whether companies like Coveo would be disrupted or become market takers in applied AIs. we can confirm our belief that we are a beneficiary. As interest in AI rose, early investor focus was on the silicon GPU layer and the hyperscalers, seen as the obvious initial AI beneficiaries. However, we believe greater value will soon emerge at the application layer, where AI drives measurable productivity gains, revenue, cost, and experience outcomes. This is where Coveo excels. Our technology deploys in days or weeks, not months or years, delivering measurable service cost reductions, revenue increases, and productivity gains. Dozens of customer case studies and financial return testimonials are available on our website, and I really invited you to take a look at Coveo.com. As you can see, the market's perception of search has undergone a dramatic reversal. Once considered a basic tool, search is now recognized as a complex science. Think about digital experience leaders that have used AI to deliver highly relevant, personalized experiences like those offered by Netflix or Amazon or Spotify, and the science that went into building those hyper-personalized and prescriptive experiences. These are grounded in search and relevance. When Chad GPT launched, many thought search might be disrupted, but technical experts knew that search was the linchpin for successful generative experiences and that without powerful relevance, agent tech would be difficult to pull off. We predicted this need and invested over a decade in maturing advanced AI relevance technology. partnering with leading companies and managing vast data sets. Today, our market is booming, with private companies reaching record valuations and global tech giants showing strong interest. We see this trend and validation as very positive for the state, and for Coveo in particular, given our unique strength and the validation we get from our customers. At the same time, We remain steadfast and focused on solid unit economics and scalable, sustainable growth. We believe we are well positioned to invest for growth and scale and to deliver real value for shareholders. In summary, we believe Coveo offers substantial asymmetric upside. We bring together the hallmarks of an exceptional company. Our strong prospects for growth and returns are supported by market leadership, unique technology, rapid value delivery, a robust financial model, and an expanding addressable market. Our focus is on innovation, delighting customers with high financial returns through AI and disciplined execution and operational excellence to scale. Our gross margin is high. Our go-to-market strategy and unit economics are profitable and and our multi-tenant platform is scalable. Together, these factors create a solid foundation for investment, significant gains in market recognition, and accelerated growth. And I feel super confident about the quality of our leadership team to lead in the market ahead. With that, I'll hand things over to Laurent, who will share more details and what's next for Coveil. Laurent returns as CEO leading our outstanding global team while I serve alongside him as executive chairman. Together with our leadership team and our strong team of AI experts, we're shaping Caveo's future. Laurent?