OneStream (OS) FY Conference Summary Company Overview - OneStream is a software company that specializes in corporate performance management (CPM) solutions, providing a single platform for budgeting, planning, forecasting, financial close, and consolidation [3][4] - The company has grown significantly from $35 million in Annual Recurring Revenue (ARR) to approximately $600 million, with employee count increasing from around 300 to 1,600 [4] Key Points and Arguments Business Model and Market Position - OneStream's platform is designed to replace legacy systems, providing a single source of truth for financial data, which enhances accuracy and trust in reporting [15][20] - The company has a 98% gross retention rate, indicating strong customer satisfaction and loyalty [20][22] - OneStream's approach to consolidation is technically challenging, which creates a competitive moat against other planning applications [10][11] Customer Engagement and Satisfaction - The company emphasizes customer satisfaction, aiming for every customer to act as a reference for potential clients [22][24] - OneStream's software is integrated with various data sources, including ERP systems like SAP and Oracle, as well as operational data from platforms like Salesforce [29][30] Market Opportunities - There is a significant opportunity for OneStream to capture market share from legacy CPM systems, with only 5% penetration in this segment [33][40] - The ongoing ERP migration cycle presents a chance for OneStream to modernize the office of the CFO without requiring a complete ERP replacement [32][33] Competitive Landscape - OneStream competes primarily against Oracle Hyperion and SAP, with a notable focus on displacing legacy systems [47][48] - The company has introduced CPM Express, a pre-configured version of its software aimed at simplifying implementation and expanding its market reach [41] Technological Advancements - OneStream has integrated AI capabilities into its platform, enhancing forecasting accuracy and scenario analysis for CFOs [49][50] - The introduction of Genesis, a no-code/low-code development tool, allows for rapid application development and integration of new features [58] Financial Performance and Outlook - The company experienced deal slippage in Q4 but reported a strong recovery in Q1, with the highest sales pipeline ever recorded [66][70] - Attendance at the user conference exceeded expectations, indicating strong customer engagement and interest in OneStream's offerings [70][73] Additional Important Insights - OneStream's strategy includes replacing multiple systems for clients, with an average of two to six systems replaced per customer [54] - The company is focused on being the platform for the office of the CFO, similar to how other software companies have positioned themselves for different business functions [56] - The acquisition of three applications for $3.7 million is part of OneStream's strategy to enhance its product offerings and provide more value to customers [63][64]

Core Insights - OneStream announced enhancements at its Splash 2025 user conference, including new Productivity Tools, a certified Power BI Connector integration with Microsoft Fabric, and the release of Version 9 of the OneStream Platform [1][2][4] Product Enhancements - The new Productivity Tools aim to help finance teams operate more efficiently, reducing reliance on technical resources and providing deeper insights with less effort [2][9] - The Power BI Connector for Microsoft Fabric allows users to combine and analyze OneStream data with other enterprise sources, enhancing insights across the business [3] - Version 9 of the OneStream Platform focuses on performance, scalability, and analytics, enabling customers to streamline financial operations and navigate uncertainty confidently [4] Company Overview - OneStream is positioned as a leading enterprise finance management platform that unifies financial and operational data, embedding AI for improved decision-making and productivity [5][6] - The company serves over 1,600 customers, including 17% of the Fortune 500, and has a vision to be the operating system for modern finance [7]

Core Insights - OneStream has launched four new SensibleAI capabilities aimed at enhancing finance teams' forecasting, insights, and productivity [1][4][12] - The SensibleAI solutions are integrated throughout the OneStream platform, addressing planning, forecasting, close processes, and reporting [1][12] SensibleAI Capabilities - SensibleAI Agents are AI-powered chat assistants that facilitate data retrieval, analysis, visualization, and task execution within existing workflows [5][6] - SensibleAI Studio offers over 30 AI routines for teams with limited data science expertise, enabling anomaly detection and performance optimization [7][8] - SensibleAI Account Reconciliations automate the reconciliation process, improving compliance and reducing manual effort [11] - SensibleAI Forecast combines machine learning and generative AI to enhance forecasting accuracy by over 25% and reduce cycle times by more than 85% [12][13] Market Context - A recent survey indicated a significant skills gap in finance, with 89% of finance students feeling prepared to use AI, compared to only 54% of senior professionals [2] - The pressure on finance leaders is increasing due to economic volatility and rising expectations for strategic insights [4]

Core Insights - A new study reveals a significant AI skills gap between finance students and seasoned finance professionals, highlighting the need for improved AI readiness in the finance sector [1][3][4] AI Readiness and Skills Gap - Two-thirds (66%) of current corporate finance professionals report using AI at work, while 86% of all respondents believe they will use AI tools in their careers [2] - There is a notable decline in AI skills readiness as professionals gain experience; 89% of finance students feel prepared to use AI, compared to only 54% of professionals with over 10 years of experience [3] - Over half (57%) of finance professionals identify a generational technology divide as a significant issue within their organizations, with the AI skills gap being a major contributor [3] Gender Disparities in AI Adoption - Male finance professionals report higher AI usage (71%) compared to female professionals (61%), indicating a gender gap in technology adoption [5] - Among young finance professionals, only 56% of young women feel prepared to use AI, compared to 69% of young men [6] - In finance education, only 12% of female students expect to rely heavily on AI, versus 68% of male students, reflecting a broader trend in expectations and experience [7] Career Expectations vs. Reality - The top motivators for pursuing a finance career include job stability (63%), high salary (57%), and a clear roadmap for career growth (55%) [8] - There is a disconnect between student expectations and the realities of finance careers; 79% of students expect to work less than 40 hours per week, while 58% of current professionals report working 40 hours or more [9][10] - Only 51% of current professionals believe new graduates are adequately prepared for the realities of finance jobs, emphasizing the need for better training [11] Recommendations for Future Success - To bridge the skills gap, the finance industry must invest in early training programs and modern practices that equip new talent with the necessary skills to thrive in a rapidly evolving environment [12]

Group 1 - The stock markets have rebounded significantly from post-April lows, suggesting a favorable environment for investors to reassess their holdings based on valuation metrics [1] - Gary Alexander has extensive experience in the technology sector, having worked on Wall Street and in Silicon Valley, which informs his insights into current industry trends [1] - Alexander has been a contributor to Seeking Alpha since 2017 and has been featured in various web publications, indicating his established presence in the investment community [1]

Financial Data and Key Metrics Changes - Total revenue grew 24% year over year to $136 million [26] - Subscription revenue increased 31% year over year to $125 million [26] - Free cash flow reached a record $36 million, representing a 26% free cash flow margin [27] - Non-GAAP net income was $6.7 million, with non-GAAP earnings per share at $0.04 [29] - Total RPO grew 24% year over year to $1.1 billion [28] Business Line Data and Key Metrics Changes - License revenue decreased 40% year over year to $4 million due to customer SaaS conversions [26] - Professional services and other revenue was $8 million, slightly above expectations [26] - Sensible AI Forecast bookings grew over 50% year over year [17] - CPM Express product saw solid bookings growth of over 50% year over year in the commercial business [16] Market Data and Key Metrics Changes - International business revenue grew 40% year over year, representing more than 30% of total revenue [27] - More than 60% of business came from new customers, indicating strong market demand [27] Company Strategy and Development Direction - The company aims to be the operating system for modern finance, focusing on agility in financial operations [24] - Continued investment in finance AI portfolio and product innovations, including ESG reporting and planning solutions [16][17] - The strategy includes democratizing access to enterprise-level platforms through products like CPM Express [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic turbulence and emphasized the importance of system modernization [9][12] - The company reiterated its 2025 revenue growth guidance of 20% year over year, while slightly increasing profitability outlook [30] - Management acknowledged potential deal headwinds due to tightening budgets and ongoing customer conversions to SaaS impacting license revenue [30] Other Important Information - The company plans to participate in upcoming conferences to showcase its product innovations [5] - Organizational changes were made to enhance leadership for growth, with key functions reporting directly to the CEO [24] Q&A Session Summary Question: Clarification on demand issues and guidance - Management noted that while leading indicators are positive, they are being cautious due to macroeconomic uncertainties [38] Question: Insights on CPM Express product performance - Management confirmed that CPM Express is resonating well with customers, providing faster onboarding to the OneStream platform [44] Question: Revenue guidance and deployment assumptions - Management indicated that macroeconomic announcements have led to a cautious approach in revenue guidance, despite a strong sales pipeline [48][49] Question: Trends in end market bookings - Over 60% of business came from new customers, with a focus on legacy replacements driving bookings growth [52] Question: Federal spending outlook - Management expressed optimism about federal business, highlighting the need for modernization in legacy software [66] Question: Pricing and packaging changes - The new pricing strategy aims to simplify customer contracts and align with the value of new offerings [70] Question: Customer growth potential in 2025 - Management sees multiple growth vectors, including interest in AI and a focus on the commercial segment [105]

Financial Data and Key Metrics Changes - Total revenue grew 24% year over year to $136 million [22] - Subscription revenue increased 31% year over year to $125 million [22] - Free cash flow reached a record $36 million, representing a 26% free cash flow margin [23] - Non-GAAP net income was $6.7 million, with non-GAAP earnings per share at $0.04 [26] - Total RPO grew 24% year over year to $1.1 billion [25] Business Line Data and Key Metrics Changes - License revenue decreased 40% year over year to $4 million due to customer SaaS conversions [22] - Professional services and other revenue was $8 million, slightly above expectations [22] - Sensible AI Forecast bookings grew over 50% year over year [14] - CPM Express product saw solid bookings growth of over 50% year over year [13] Market Data and Key Metrics Changes - International business revenue grew 40% year over year, representing more than 30% of total revenue [23] - More than 60% of business came from new customers [23] - The company ended the quarter with 1,646 total customers, up 16% year over year [23] Company Strategy and Development Direction - The company aims to be the operating system for modern finance, focusing on agility in financial operations [20] - There is a strong emphasis on AI capabilities to enhance financial performance and forecasting accuracy [11][12] - The launch of ESG reporting and planning solutions aligns with the growing demand for sustainability reporting [14][89] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic turbulence and emphasized the importance of system modernization [6][9] - The company reiterated its 2025 revenue growth guidance of 20% year over year, while slightly increasing profitability outlook [28] - Management acknowledged potential deal headwinds due to tightening budgets and ongoing customer conversions to SaaS impacting license revenue [27] Other Important Information - The company plans to participate in upcoming conferences to showcase its product innovations [3] - Organizational changes were made to enhance innovation and growth functions [20] Q&A Session Summary Question: Clarification on demand issues and guidance - Management noted that leading indicators are positive, with the strongest sales pipeline ever, but prudence is warranted due to market uncertainty [34][36] Question: Insights on CPM Express product performance - Management confirmed that CPM Express is resonating well with customers, providing faster onboarding to the OneStream platform [40][42] Question: Revenue guidance and deployment assumptions - Management indicated that macroeconomic announcements have led to cautious guidance, despite a strong sales pipeline [46][47] Question: Trends in end market bookings - Over 60% of business came from new customers, with a focus on legacy replacements driving bookings growth [50][51] Question: Federal spending outlook - Management remains optimistic about federal business, viewing OneStream as a modernization play for legacy software [65] Question: Pricing and packaging changes - The new pricing strategy aims to simplify customer contracts and align with the value of new offerings [67][68] Question: Sensible AI forecast growth and impact - Management highlighted significant improvements in forecasting accuracy and reduced effort, leading to increased interest in the product [71][74] Question: International market performance - Management reported strong growth in international markets, attributing it to strategic foundational deals and investments [78][80] Question: Customer use cases and consumption-based pricing - Management noted that as customers adopt more use cases, it leads to material opportunities for ARR growth [83][85]

Financial Performance - Q1 2025 - Total revenue reached $136 million, representing a 24% year-over-year growth[8] - Subscription revenue amounted to $125 million, a 31% year-over-year increase[8] - The non-GAAP gross margin was 70%[8] - Free cash flow margin was 26%[8] - Non-GAAP operating margin was at breakeven[8] Customer Growth - The total number of customers reached 1,646, reflecting a 16% increase[13] Billings Trends - Billings reached $154 million in Q1 2025[16] - Last Twelve Months (LTM) billings grew by 24% year-over-year[15] Profitability & Expenses - Non-GAAP gross profit was $95606000, with a margin of 70%[36] - Non-GAAP sales and marketing expenses accounted for 39% of revenue[22] - Non-GAAP research and development expenses represented 18% of revenue[22] - Non-GAAP general and administrative expenses were 14% of revenue[22] Guidance - For Q2 2025, total revenue is projected to be between $140 million and $142 million[31] - For the full year 2025, total revenue is expected to range from $583 million to $587 million[31]

Core Insights - OneStream is hosting its flagship user conference, OneStream Splash, from May 13 to 15, 2025, in Nashville, TN, focusing on AI-driven innovation in finance [1] - The event will feature over 2,300 finance leaders and technical professionals, making it the largest Splash event to date [3] - OneStream aims to empower finance leaders to navigate uncertainty and improve productivity through AI solutions tailored for finance [2][4] Event Highlights - The conference will include over 80 breakout sessions across eight tracks, covering topics such as Financial Planning & Forecasting and Real-World AI Use Cases [4] - Keynote sessions will feature insights from OneStream CEO Tom Shea on the future of finance in the AI era and how finance leaders can leverage AI and automation [4] - The Wave Technical Program will provide hands-on labs and practical sessions for deploying OneStream solutions using no-code tools [4] Success Stories and Leadership - The event will showcase firsthand stories from finance leaders at companies like Endeavour Energy and Gibson, highlighting the use of OneStream for modernizing planning and reporting [4] - Reshma Saujani, founder of Girls Who Code, will discuss leadership and growth, emphasizing the importance of embracing bravery in building future leaders [4] - The Women in Finance program will spotlight female finance leaders, offering inspiration and real stories of ambition and advocacy [4] Innovation and Collaboration - An expanded Innovation Hall will feature interactive experiences, including partner showcases and live product demos, aimed at fostering collaboration [4] - Attendees will have opportunities to engage with OneStream experts and explore AI-driven solutions in finance [4][5] - The conference is supported by various global advisors and implementation partners, enhancing the collaborative environment [5] Company Overview - OneStream is recognized as a leading enterprise finance management platform that unifies financial and operational data, embedding AI for improved decision-making [6][7] - The company serves over 1,600 customers, including 17% of the Fortune 500, and aims to be the operating system for modern finance [8]