Financial Data and Key Metrics Changes - Fourth quarter ARR reached $1.853 billion, up 11% year-over-year, driven by $70 million of net new ARR and revenue of $481 million, up 14% year-over-year [7][31] - Full year GAAP profitability achieved for the first time in company history, with fourth quarter non-GAAP operating income of $150 million, representing a 31% margin [8][35] - Full year total revenue was $1.611 billion, an increase of 13% year-over-year [31] Business Line Data and Key Metrics Changes - AI product ARR, which includes Agentic, IDP, and Maestro, reached nearly $200 million in the fourth quarter, with strong growth fueled by Agentic [16] - The number of customers above $100,000 in ARR who have bought AI products grew 25% year-over-year, spending nearly 3x as much as those who have not [16][32] - Customers with over $1 million in ARR saw 90% using AI products, indicating strong integration of AI into the customer base [32] Market Data and Key Metrics Changes - Over $1.2 billion in cloud ARR, which includes both hybrid and SaaS, up over 20% year-over-year [31] - Dollar-based gross retention was 97%, and dollar-based net retention rate remained at 107% [34] - Remaining performance obligations increased to $1.475 billion, up 19% [34] Company Strategy and Development Direction - The company is focused on accelerating growth across its customer base, expanding penetration inside its install base, and scaling AI adoption on top of deterministic automation [28] - The strategy includes deepening vertical solutions in regulated and mission-critical industries, particularly healthcare and financial services [21][74] - The company plans to leverage coding agents across the entire automation lifecycle to enhance efficiency and reduce the time required to build automations [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growing demand for automation and AI, noting that AI initiatives are driving renewed interest in automation [84] - The company is bullish about its position in the public sector and sees strong traction in financial services and healthcare [68][70] - Management expects to cross $2 billion in ARR in fiscal year 2027, reflecting the durability of the business model [26] Other Important Information - The company repurchased approximately $337 million worth of shares in the fiscal year, completing a $1 billion stock repurchase program [36] - The board has authorized an additional $500 million in repurchase capacity, reflecting confidence in cash flows [37] Q&A Session Summary Question: Net new ARR expansion potential and FX contribution - Management indicated that there is no significant FX contribution affecting net new ARR expansion, with minimal impact from currency fluctuations [46][48] Question: AI traction and ARR composition - Management noted strong momentum in AI products, with IDP contributing significantly, but specific ratios between components were not disclosed [52][53] Question: Federal business outlook - Management expressed bullishness about the federal sector, noting strong connections and opportunities within certain agencies [60][68] Question: Budget trends in automation and AI - Management highlighted a strong position in the market, emphasizing the importance of process orchestration technologies and the integration of AI into workflows [63][64] Question: Impact of SaaS shift on growth - Management clarified that the SaaS shift is expected to create a 1% headwind to total revenue growth, but the overall adoption of agentic solutions is scaling well [80]

Financial Data and Key Metrics Changes - The company raised its long-term non-GAAP operating margin target to 30%, indicating confidence in achieving this goal within a three-year timeframe [67] - The dollar-based net revenue retention rate decreased by one point to 106% when adjusted for foreign exchange [70] Business Line Data and Key Metrics Changes - The company reported strong momentum in AI products, with 90% of million-dollar-plus customers incorporating AI products into their operations [44] - The acquisition of WorkFusion is expected to enhance capabilities in financial crimes and public sector verticals, although its contribution to ARR is considered immaterial [15][32] Market Data and Key Metrics Changes - The company is seeing increased demand in the healthcare and financial sectors, particularly in areas like revenue cycle management and financial crime [32] - There is a noted variability in the macroeconomic environment, with strengths observed in financial services and healthcare, while some uncertainty remains in regions affected by geopolitical conflicts [26] Company Strategy and Development Direction - The company is focusing on a vertical strategy, emphasizing coding agents, process orchestration, and vertical solutions to meet customer demands [49] - The integration of AI and agentic automation is seen as complementary, driving renewed interest in automation across various workflows [42] Management's Comments on Operating Environment and Future Outlook - Management characterized the current operating environment as variable, with pockets of strength and pressure across different sectors [26] - There is optimism regarding the federal government sector, with expectations of increased long-term project opportunities [19] Other Important Information - The company is committed to maintaining a disciplined approach to investments, focusing on areas with higher returns to drive scalability [67] - The impact of foreign exchange on ARR was deemed immaterial, with sales execution being the primary driver for performance [51] Q&A Session Summary Question: How is the company thinking about net new ARR expansion potential? - Management indicated that there is minimal impact from foreign exchange on ARR and emphasized opportunities for margin expansion through technology advancements [5][6] Question: Can you provide details on the AI traction with respect to ARR? - Management noted strong momentum in AI diffusion within the platform, although specific ratios between components were not disclosed [11][12] Question: What is the contribution of WorkFusion to ARR? - Management clarified that the $25 million ARR figure reported elsewhere is inaccurate and that WorkFusion's contribution is below materiality thresholds [15] Question: How is the company positioned to capture market demand for automation and AI? - Management expressed confidence in their ability to help customers integrate AI into enterprise workflows, highlighting the advantages of their process orchestration technology [23] Question: What are the main drivers for dollar-based net revenue retention? - Management stated that both net new logos and expansion opportunities are expected to stabilize, with AI and agentic products driving growth [71]

Financial Data and Key Metrics Changes - The company reported a third quarter ARR of $1.782 billion, an increase of 11% year-over-year, driven by $59 million in net new ARR [6][24] - Revenue for the quarter was $411 million, reflecting a 16% increase year-over-year [6][23] - The company achieved its first GAAP profitable third quarter with GAAP operating income of $13 million, compared to a GAAP operating loss of $43 million in the prior year [7][26] - Non-GAAP operating income reached $88 million, representing a 21% margin, up more than 700 basis points year-over-year [7][27] - Dollar-based net retention rate was 107%, indicating strong customer engagement and retention [25][72] Business Line Data and Key Metrics Changes - The company highlighted significant customer engagement with over 950 companies developing agents and more than 365,000 processes orchestrated with Maestro [8][24] - The introduction of agentic capabilities in various products, such as intelligent extraction and processing, has enhanced customer automation efforts [10][11] - The company reported strong performance in the federal sector, with no major impact from the government shutdown, indicating resilience in critical operations [35][46] Market Data and Key Metrics Changes - The company ended the quarter with approximately 10,860 customers, with an increase in customers generating $100,000 or more in ARR to 2,506 [24] - Remaining performance obligations increased to $1.265 billion, up 12% year-over-year, indicating a healthy future revenue stream [25] - The company is expanding its cloud footprint in key markets, including Switzerland and the UAE, to meet regional data residency and governance requirements [15][16] Company Strategy and Development Direction - The company is focused on enhancing its automation strategy by integrating deterministic automation with agentic AI to deliver trusted enterprise-grade automation [5][6] - The company is actively pursuing vertical solutions in industries such as healthcare and financial services, aiming to accelerate outcomes and ROI for customers [16][84] - Collaborations with technology leaders like Microsoft, OpenAI, and NVIDIA are aimed at enhancing the capabilities of the platform and driving customer value [17][52] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's execution and innovation pace, positioning it well for future growth [20][21] - The company anticipates continued improvement in net new ARR growth, supported by enhanced execution and customer engagement [38][66] - Management acknowledged that while early traction with agentic capabilities is promising, significant contributions to top-line growth are not expected in fiscal 2026 [28][28] Other Important Information - The company was recognized as a leader in the Gartner Magic Quadrant for intelligent document processing and AI augmenting software testing tools, highlighting its competitive positioning [11][12][13] - The company is committed to maintaining operational efficiency while investing in key areas such as engineering and sales capacity to support growth [59][60] Q&A Session Summary Question: Can you provide insights on the traction of agentic solutions? - Management noted strong momentum across agentic offerings, with consistent buying patterns emerging from proof of concepts to production [32][34] Question: Was there any impact from the government shutdown on federal business? - Management confirmed no direct impact from the shutdown, as many projects are funded through bills and are considered critical operations [35][46] Question: What are the drivers for the expected growth in net new ARR? - Management attributed the growth to improved execution, customer activity, and a stable macroeconomic environment [38][66] Question: Can you elaborate on the OpenAI collaboration? - Management highlighted the use of GPT-5 across the platform, particularly in the Screenplay product, which combines UI automation with LLM capabilities [47][48] Question: How is the partnership with Deloitte impacting the pipeline? - Management indicated that the quality of the pipeline has improved significantly due to deeper engagement with partners like Deloitte [56] Question: What are the expectations for the federal sector moving forward? - Management expressed optimism about the federal sector's performance, noting a return to a new normal with solid deals [46][68] Question: How is the company addressing spend predictability for agentic consumption? - Management is evaluating customer adoption patterns and aims to develop flexible pricing models that reflect AI consumption [90][91]

Financial Data and Key Metrics Changes - The company reported third quarter ARR of $1.782 billion, an increase of 11%, driven by $59 million in net new ARR [4][22] - Revenue for the quarter was $411 million, reflecting a 16% year-over-year increase [5][21] - The company achieved its first GAAP profitable third quarter with GAAP operating income of $13 million, compared to a GAAP operating loss of $43 million in the prior year [24] - Non-GAAP operating income reached $88 million, representing a 21% margin, up more than 700 basis points year-over-year [24] Business Line Data and Key Metrics Changes - The company highlighted strong customer engagement with over 950 companies developing agents and more than 365,000 processes orchestrated with Maestro [6][22] - The introduction of agentic capabilities in the intelligent extraction and processing (IXP) product is expected to enhance automation in document-heavy processes [9][10] Market Data and Key Metrics Changes - The company ended the quarter with approximately 10,860 customers, with significant growth in customers generating $100,000 or more in ARR, increasing to 2,506 [22] - Dollar-based gross retention remained at 98%, while the dollar-based net retention rate was 107%, indicating strong customer loyalty [23] Company Strategy and Development Direction - The company is focused on enhancing its automation strategy by integrating deterministic automation with agentic AI, aiming to provide trusted enterprise-grade automation [4][5] - The company is expanding its cloud footprint in key markets and developing vertical solutions to address industry-specific challenges [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to drive future growth and operational efficiency, despite a variable macroeconomic environment [24][25] - The company is raising guidance for the fourth fiscal quarter, expecting revenue in the range of $462 million to $467 million [25][26] Other Important Information - The company was recognized as a leader in the Gartner Magic Quadrant for intelligent document processing and AI augmenting software testing tools, highlighting its capabilities in these areas [10][11] - The company is actively collaborating with technology partners like OpenAI and Microsoft to enhance its automation offerings [16][17] Q&A Session Summary Question: Regarding agentic solution traction - Management noted that over 950 clients are developing agents, indicating strong momentum across the agentic offering [27][28] Question: Impact of the federal shutdown - Management confirmed no direct impact from the federal shutdown, as many projects are funded through bills and considered critical operations [29] Question: Drivers of net new ARR growth - Management attributed the expected growth to improved execution, customer activity, and a stable macroeconomic environment [30][44] Question: OpenAI collaboration details - Management highlighted the use of GPT-5 across the platform, particularly in the Screenplay product, which combines UI automation with LLM adaptability [34] Question: Incremental pipeline from partnerships - Management emphasized the quality of partnerships, particularly with Deloitte, which has led to deeper engagement in larger-scale transformation processes [38] Question: Agentic consumption pricing predictability - Management acknowledged the industry's dynamic nature and is working on flexible pricing models to help customers forecast usage patterns more reliably [56]