Financial Data and Key Metrics Changes - The company reported total revenue of $300 million for Q4, representing an 8% year-over-year growth [19] - Subscription revenue grew by 12% year-over-year in Q4, now making up 82% of total revenue, up from 79% a year ago [21] - Adjusted EBITDA margin increased to 26%, while free cash flow more than doubled year-over-year to a margin of 22% [10][23] - For the full year 2025, total revenue was $1.15 billion, growing 10% year-over-year, with subscription revenue growing 13% year-over-year [24] Business Line Data and Key Metrics Changes - Enterprise AI revenue growth accelerated to 50% year-over-year, contributing significantly to the overall subscription revenue [19][10] - Core CCaaS subscription revenue growth accelerated to 8% year-over-year [19] - The enterprise business represented approximately 91% of total revenue on a last twelve months (LTM) basis, with LTM enterprise subscription revenue growing 15% year-over-year [22] Market Data and Key Metrics Changes - Gartner forecasts the market for traditional CCaaS to grow at a 9% CAGR and the GenAI customer service market to grow at a 34% CAGR through 2029, reaching a combined annual spend of $48 billion [11] - The company is experiencing strong traction in sectors such as healthcare and retail, with significant adoption of AI capabilities [86] Company Strategy and Development Direction - The company aims to lead in AI-powered customer experience (CX) by leveraging conversational data and enhancing its end-to-end platform capabilities [11][12] - A strong focus on partnerships, particularly with Google Cloud, is seen as a key driver for differentiation and innovation in AI solutions [13][79] - The company is committed to expanding its AI capabilities and enhancing customer experiences through new product innovations [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning for continued success in 2026 and beyond, driven by strong demand for AI solutions [10] - The CEO highlighted the importance of a unified CX platform to meet evolving customer needs and the potential for significant market expansion [8][10] - Management acknowledged macroeconomic challenges but remains optimistic about the company's growth trajectory and operational excellence [3][10] Other Important Information - The company completed a $50 million accelerated share repurchase on February 2, buying back approximately 2.6 million shares, reflecting strong cash generation [27] - The company plans to host an Investor Day in late 2026 to provide additional details on strategic priorities and long-term financial outlook [27] Q&A Session Summary Question: Breakdown of AI revenue growth between new and existing customers - Management indicated that both new logo acquisition and penetration into the existing customer base are contributing significantly to AI revenue growth [31][32] Question: Future product changes and opportunities in AI - The new CEO expressed optimism about transforming the CX space through AI and traditional CCaaS, emphasizing the potential for new customer experiences [40] Question: Risks from LLM native platforms - Management highlighted the competitive moat provided by their orchestration capabilities and historical conversational data, which cannot be easily replicated by LLMs [60][62] Question: Sector performance and customer pain points - The company is seeing strong adoption in healthcare and retail, with customers focusing on improving their data strategies to leverage AI effectively [52][86] Question: Guidance for 2026 revenue and backlog contributions - Management clarified that the guidance for 2026 includes contributions from dollar-based retention rate (DBRR) and backlog, with a focus on consumption-based revenue from AI solutions [68][71]