Financial Data and Key Metrics Changes - The company reported a record high revenue of $597 million in the first half of 2025, compared to $585 million in the same period of 2024, marking the highest revenue in the first half of the year in the company's history [19] - Non-GAAP operating income for the first half of 2025 was $106 million, with a non-GAAP adjusted operating margin of 19.5%, up from $91 million and 17% in the prior year [20] - Non-GAAP adjusted EBITDA was $132 million for the first half of 2025, representing 24.4% of revenue, compared to $118 million or 22% in the prior year [20] - Non-GAAP EPS increased to $2.29, a 13% rise from $2.20 in the prior year, primarily due to higher non-GAAP adjusted operating income [21] Business Line Data and Key Metrics Changes - The company achieved a non-GAAP operating margin of 19.5% in the first half of 2025, reflecting a 250 basis point improvement from the same period last year [5] - Revenue diversification improved, with 32% of total revenue coming from industries outside of cable and telecom, up from 31% in the prior year [6] - The company reported a 14% year-over-year growth in its merchant base, reaching 142,000 merchants in Q2 [14] Market Data and Key Metrics Changes - The company anticipates revenue growth in the 2% to 3% range for 2025, primarily due to headwinds in the North American broadband market and elongated sales cycles [23] - The termination of a contract with a Latin American telecommunications customer is expected to have a minimal impact on overall revenue, accounting for $1.4 million in the first half of 2025 [24] Company Strategy and Development Direction - The company aims to diversify revenue from faster-growing new industry verticals to over 35% of total revenue by 2026 [9] - The leadership team is focused on evolving into a more asset-light SaaS business to generate higher profit and cash flow from investments [15] - The company is committed to maintaining a disciplined approach to M&A, targeting acquisitions that enhance its capabilities in core verticals [16][62] Management's Comments on Operating Environment and Future Outlook - Management noted a cautious approach among customers regarding discretionary spending, impacting decision-making processes [30] - The company remains optimistic about its sales pipeline and expects continued growth despite current market challenges [88] - Management highlighted the importance of simplifying business processes for telecom operators to remain competitive in a digital landscape [51] Other Important Information - The company has returned over $600 million to shareholders since 2020 and is on track to exceed its commitment of $100 million in share repurchases and dividends for 2025 [10] - The company is leveraging AI to enhance its product offerings and operational efficiencies, with expectations for significant impacts on profitability [46] Q&A Session Summary Question: Insights on the broader macro environment - Management observed a cautiousness in discretionary spending but noted ongoing strategic decisions and technology deployments by customers [30] Question: Impact of recent M&A activity within the customer base - Management indicated that historical consolidation trends in the cable broadband and telco sectors have generally benefited the company [32] Question: Opportunities in the global telecom space - Management emphasized their differentiated capabilities in complex enterprise solutions, which have led to successful engagements with Tier one operators [38] Question: AI's impact on profitability and competition - Management acknowledged the growing importance of AI in enhancing operational efficiency and product offerings, while not seeing direct competition from AI-enabled firms [82] Question: New business pipeline and sales cycles - Management reported a healthy sales pipeline but noted elongated sales cycles due to cautious customer behavior [88]