Thinkific Labs Inc.

Good afternoon, my name is Konstantin and I will be your conference operator today. I would like to welcome everyone to Thinkific's second quarter 2025 financial results conference call. At this time, all lines are in listen only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Wednesday, August 6th, 2025. I would now like to turn the conference over to Joo-Hun Kim, Head of Investor Relations. Please go ahead.

Thank you and good afternoon, everyone. Welcome to Thinkific's second quarter 2025 financial results earnings call. Joining me today are Greg Smith, CEO and co-founder of Thinkific, and Karine Hua, CFO. After the prepared remarks, we will open up the call to questions. During the call today, we will discuss our business outlook and make forward-looking statements that are based on assumptions and therefore subject to risks and uncertainties that could cause actual results to differ materially from those projected. These comments are based on our predictions and expectations as of today. We undertake no obligation to update these statements except as required by law. You can read about these risks and uncertainties in our regulatory filings that were filed earlier today. Our commentary today will include adjusted financial measures, which are non-IFRS measures. They should be considered as a supplement to and not a substitute for IFRS measures. Reconciliations between the two can be found in our regulatory documents, which are available on our website. In addition, our commentary today will include key performance indicators that help us evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions. Such key performance indicators may be calculated in a manner different to similar key performance indicators used by other companies. I should also note we have a slide deck that supports our remarks available to download on the webcast interface or on our website. And finally, all dollar amounts discussed today are in U.S. dollars unless otherwise indicated. I will now turn the call over to Greg Smith, CEO and co-founder of Thinkific.

Hello, and welcome to Thinkific's Q2 fiscal 2025 earnings call. Q2 marked the official launch of our move up market, and we are now well underway to executing on a strategy aligning Thinkific's differentiated learning commerce platform to support our ideal customers. By leveraging our core strengths, Integrating courses, communities, AI, and commerce, we plan on meeting the growing demand for scalable, education-driven revenue models. We're confident that this approach, along with our continued commitment to driving customer success, will ultimately accelerate growth for Thinkific. On today's call, I'll provide an update on our ongoing transition upmarket with a focus on our progress in artificial intelligence. AI represents a transformative opportunity to enhance our platform. We've already integrated AI capabilities that help our customers create content more efficiently. Looking ahead, our product roadmap is centered on AI agents that serve the needs of our best customers, designed to enhance the student learning experience and manage interactions as well as sales at scale. A move that I believe positions us at the forefront of the industry. With respect to our team, I'm delighted to announce Russ Mann as Thinkific's new chairman of the board. Russ brings a wealth of leadership experience in the technology sector, particularly with SaaS companies, and a strong track record with high growth organizations. His expertise makes him an ideal fit to guide our board moving forward, and his contributions have already proven impactful. I'm also grateful that Fraser will remain on our board of directors, where his valuable experience and insights will continue to be greatly appreciated. Over the past quarters, I've shared elements of our new strategies, specifically how we are sharpening our focus on the upmarket segment and adjusting our go-to-market strategy to align with the increasing demand from larger, more established customers. These are businesses that are launching academies, certification programs, and training hubs to scale their revenue. Today, I want to spend more time on how our product roadmap aligns with this vision. We're working to create an integrated platform that both attracts more scaled and successful businesses into self-serve while also increasing the upgrade flow to and through our plus plans. We have a series of initiatives laid out over the next 12 to 16 months that cover both an expansion of product features and a comprehensive relook at drivers of ARPU to ensure our platform is both competitive and compelling to our new target market and drives expansion opportunities. This platform leverages AI throughout to enhance a student's learning experiences, incorporating assistants that personalize learning and communities to foster collaboration, discussion, and deeper learning. I view AI as an essential driver of Thinkific's competitive advantage and future growth. Rather than treating AI as a peripheral tool or simple assistant, Thinkific is fundamentally integrating AI into every facet of our operations. I've encouraged every team member, regardless of their role, to explore how AI can be woven into their daily work. We want to foster a culture that not only utilizes AI, but lives and breathes it throughout the organization. AI is enabling Thinkific to rethink its approach to product development and provide us with significant strategic flexibility. It has already accelerated our ability to design and prototype product improvements and innovate exciting new features. We expect it to boost the productivity of our R&D teams going forward. We had been exploring some specific M&A opportunities to swiftly bring a competitive product to market. Thinkific now finds that in some cases, AI empowers our own teams to develop features and capabilities more rapidly and efficiently. This minimizes acquisition risk, reducing time to market, and reinforces the company's agility to respond to changing market needs. That said, we continue to consider if build versus buy makes the most sense for us. And note, we're fortunate that our balance sheet allows us that flexibility. I believe that Thinkific is uniquely positioned to lead in the use of AI in a few key areas. Our 13 years of experience working with tens of thousands of customers has given us access to an extensive proprietary data set built on millions of real learning interactions. We can leverage this data set combined with the specific content of each of our customers to help empower them to scale their businesses and have a bigger impact. This kind of insight gives us an edge over new entrants or existing players that lack a focus on commerce, learning, and community interactions or a data set of this magnitude. Thinkific's AI is built specifically to help our customers sell more, teach better, and run their businesses more efficiently. Our data advantage combined with constant innovation is what will keep us ahead as AI reshapes the future of online learning. We can combine this with our customers' unique personalities, businesses, and approaches to learning and selling to empower each of them to compete better. Another area of focus is community-driven learning. We're committed to advancing blended learning ecosystems that seamlessly integrated structured courses, interactive discussions, community spaces, and live sessions. These are proven drivers to significantly increase the value we provide to our customers and their customers, the students. While our existing integrated communities product lays a strong foundation, our goal is to elevate it further by enhancing its functionality and feature set to meet and exceed the capabilities of leading market players. Positioning Thinkific as the premier platform for community-enabled learning experiences. This will also be an enabler of strong recurring revenue for our customers, and especially in demand by larger businesses, which will also benefit Thinkific with a much more stable stream of commerce revenue. Finally, a near-term priority is to provide richer commerce and B2B selling tools and features that are required for us to drive adoption of Thinkific Commerce by higher GMV customers in Plus and SelfServe. This quarter, we released tools to help with subscription management, allowing our customers to better sell and manage on a recurring revenue basis, as well as bulk licensing facilitation, the ability to better sell large quantities of licenses in their programs to a single corporate buyer. We will continue to invest in reducing friction in our customer sales, supporting recurring revenue growth, improving their international reach, and empowering these companies to scale their revenue as they grow their own businesses. Commerce is native on the Thinkific platform. It is not a bolt-on from a third party and is integrated with a student's learning journey and a deepening set of AI-enhanced data tools. This approach represents a strategic advantage and we're committed to continued investment to strengthen our leadership position and deliver unmatched value to our customers and our partners. Our aggressive product roadmap for the coming quarters is designed to deliver impactful and differentiated features that empower our customers to help their students succeed. These aren't just updates, they're transformative tools designed to redefine how learning experiences are built and monetized, giving our customers the tools to grow their businesses. We're investing for the long term, backed by a strong balance sheet and a profitable and recurring core subscription business, which gives us strategic flexibility and allows us to continue driving profitable growth as we execute on our plan. We expect the most compelling of our new features to launch in the first half of 2026 and expect to see positive leading indicators in the following quarters. The metrics we'll be watching closely are ARPU, ARR, and GPV. Success will be measured by, first, moving ARPU as we see a mixed shift into higher tiers of product and begin attracting more upmarket customers. Then, a reacceleration of ARR growth as we improve and grow our go-to-market and accelerate upmarket customer acquisition. And finally, GPV growth as we improve the adoption of and attract higher GMV customers onto Thinkific Commerce. With these initiatives in motion, I'm confident that we're positioned to deliver long-term value for our customers and our shareholders. With that, I'm going to turn it over to Corrine, who will provide more details on those leading indicators and provide specifics of our financial performance in Q2.