Financial Data and Key Metrics Changes - The company reported revenue of $189.7 million for Q1 2025, representing a 15% year-over-year increase and a 4% sequential increase [8][14] - Adjusted EBITDA was $40.7 million, accounting for 21.5% of revenue, which is a 61% increase from $25.2 million in the prior year [8][18] - Free cash flow generated was $37.8 million, exceeding typical seasonal patterns due to favorable timing with larger customer invoicing [8][19] Business Line Data and Key Metrics Changes - Subscription-based revenues grew by 18% year-over-year and 5% sequentially, making up 81% of total revenue [15] - Services and other revenues declined by 7% year-over-year, primarily due to a reduction in professional service revenues [15] - Total annualized recurring revenue (ARR) increased to $847 million, up 11% year-over-year, driven by strength in subscription ARR, which grew to $720 million, up 14% year-over-year [16] Market Data and Key Metrics Changes - The company signed a Tier one relationship pricing deal with a bank to enhance commercial relationship profitability across lending and deposit product lines [9] - Expansion activity was noted with a top 50 U.S. bank signing a deal for risk and fraud solutions, indicating a growing demand for fraud management [10] Company Strategy and Development Direction - The company aims to focus on higher-margin recurring subscription revenues, which positions it well for sustainable profitable growth [15] - The management emphasized the importance of fraud mitigation solutions, which are expected to remain a priority for customers [10][22] - The company plans to continue investing in R&D and expanding its partner ecosystem to deliver innovation quickly [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business's durability due to the mission-critical nature of its products and a strong customer base [12][20] - The company anticipates a solid pipeline for the remainder of the year, with strong renewal and expansion opportunities [12][20] - Despite macroeconomic uncertainties, the company believes its strong financial foundation will help navigate potential challenges [20][21] Other Important Information - Gross margins improved to 57.9%, up from 54.9% in the prior year, driven by a higher mix of subscription-based revenues [17] - Total operating expenses were $77 million, or 40.7% of revenue, showing improvement in operational efficiency [18] Q&A Session Summary Question: Insights on fraud management traction and pipeline - Management indicated that fraud management is a differentiator in both new deals and expansions, with significant opportunities for growth in this area [26][28] Question: Confidence in renewal opportunities for 2025 and 2026 - Management confirmed that the confidence is based on the number of logos up for renewal, similar to previous years [29][31] Question: Macro assumptions in raised outlook - Management stated that no different macro assumptions were incorporated into the raised outlook compared to the last quarter [35][36] Question: Performance in the credit union market - Management noted strong performance in the credit union sector, with many looking to diversify their offerings and enhance commercial capabilities [38][39] Question: Cash flow performance and future expectations - Management acknowledged an anomaly in Q1 cash flow due to a large customer switching to annual payments, but remains confident in maintaining high free cash flow conversion [75][76] Question: Subscription growth versus ARR growth - Management explained that subscription ARR is a leading indicator for subscription revenue, with current patterns reflecting previous trends [108]

Financial Data and Key Metrics Changes - The company reported revenue of $189.7 million for Q1 2025, representing a 15% year-over-year increase and a 4% sequential increase [6][13] - Adjusted EBITDA reached $40.7 million, accounting for 21.5% of revenue, which is a 61% increase from $25.2 million in the prior year [6][18] - Free cash flow was $37.8 million, exceeding typical seasonal patterns due to favorable timing with larger customer invoicing [6][18] Business Line Data and Key Metrics Changes - Subscription-based revenues grew by 18% year-over-year and 5% sequentially, making up 81% of total revenue [14] - Services and other revenues declined by 7% year-over-year, primarily due to a reduction in professional service revenues [14] - Total annualized recurring revenue (ARR) increased to $847 million, up 11% year-over-year, driven by strength in subscription ARR, which grew to $720 million, up 14% year-over-year [15][16] Market Data and Key Metrics Changes - The company signed a Tier one relationship pricing deal with a bank to enhance commercial relationship profitability across lending and deposit products [7] - Expansion activity within the existing customer base was significant, with a top 50 U.S. bank signing an expansion deal for risk and fraud solutions [8][10] - The company continues to see strong renewal activity, signing renewals with three of its top 10 largest customers [10][11] Company Strategy and Development Direction - The company emphasizes the importance of fraud management as a growing priority for financial institutions, which is expected to drive future bookings [22] - The focus on deposit gathering remains critical, especially in the current macroeconomic environment, which has been a tailwind for sales efforts [12] - The company aims to maintain operational efficiency while investing in innovation to meet evolving customer needs [18][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business's durability due to the mission-critical nature of its products and a strong, diverse customer base [11][20] - The company anticipates a solid pipeline for the remainder of the year, with strong renewal and expansion opportunities [12][20] - Despite macroeconomic uncertainties, management believes the company is well-positioned to navigate potential challenges while prioritizing long-term customer success [20] Other Important Information - Gross margins improved to 57.9%, up from 54.9% in the prior year, driven by a higher mix of subscription-based revenues [17] - Total operating expenses were $77 million, or 40.7% of revenue, showing improvement from 44% in the prior year [18] - The company raised its full-year revenue guidance to a range of $776 million to $783 million, representing year-over-year growth of 11% to 12% [19] Q&A Session Summary Question: Insights on fraud management traction - Management noted that fraud management is a differentiator in both new deals and expansions, with significant opportunities for growth in this area [26][28] Question: Confidence in renewal opportunities for 2025 and 2026 - Management confirmed that the confidence is based on the number of logos up for renewal, indicating a similar opportunity set compared to previous years [29][30] Question: Macro assumptions in raised outlook - Management stated that the raised outlook did not incorporate different macro assumptions, maintaining confidence in the 2025 numbers [35] Question: Credit union market focus - Management highlighted strong performance in the credit union sector, with a focus on diversifying their offerings to include more commercial customers [38] Question: Cash flow performance and future expectations - Management indicated that the strong cash flow in Q1 was partly due to a large customer switching to annual payments, which may not be repeated in Q2 [72][74] Question: Subscription growth versus ARR growth - Management explained that subscription ARR is a leading indicator for subscription revenue, with expected patterns reflecting previous years [104][106]

Financial Data and Key Metrics Changes - In Q4 2024, the company reported non-GAAP revenue of $183 million, a 13% increase year-over-year and a 5% increase sequentially [6][18] - Adjusted EBITDA for Q4 was $37.6 million, representing 20.6% of non-GAAP revenue, an improvement of approximately 630 basis points year-over-year [6][26] - Total non-GAAP revenue for the full year was $696.5 million, up 11% from the prior year [18] - Subscription revenue for the full year grew by 16%, accounting for 79% of total revenue [18][20] - Total annualized recurring revenue (ARR) grew to $824 million, up 12% year-over-year [20] - The ending backlog increased to over $2.2 billion, representing a 21% growth year-over-year [21][22] Business Line Data and Key Metrics Changes - The company achieved a record year for renewals, with renewal bookings increasing by 80% year-over-year [22][23] - In Q4, the company renewed 10% of its entire digital banking customer base [22] - Subscription net revenue retention rate ended the year at approximately 114%, up from 112% in 2023 [23] Market Data and Key Metrics Changes - The company signed 25 Tier one and enterprise deals in 2024, the most in a single year [8] - The company signed nearly twice the number of digital banking deals in Tier two and three segments compared to the previous year [9] - The fraud solutions segment was highlighted as one of the fastest-growing areas, driven by increased demand for fraud mitigation [12] Company Strategy and Development Direction - The company is optimistic about the demand environment in 2025, with a focus on expanding its subscription revenue and operational efficiencies [11][29] - The company aims to achieve a subscription revenue rule of 40 as a long-term objective [28] - The addition of Andre Mintz to the Board of Directors is expected to enhance the company's expertise in global privacy and cybersecurity [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to capitalize on a favorable demand environment and strong sales momentum [31] - The company anticipates continued healthy demand for its fraud solutions and expects expansion opportunities with existing customers [12][29] - Management noted that the deregulation in the banking sector could provide tailwinds for the company's growth [60] Other Important Information - The company ended the year with cash and investments totaling $447 million, up from $408 million in the previous quarter [26] - Free cash flow for the year was $107 million, representing an 85% conversion rate as a percentage of adjusted EBITDA [26] Q&A Session Summary Question: Can you discuss the relationship pricing with Wells Fargo and its significance? - Management highlighted the success of the relationship pricing model and its deployment with major banks, indicating strong potential for future growth [34][36] Question: How does the company view the reliance on large Tier one enterprise deals versus Tier two and three? - Management indicated a balanced pipeline for 2025, expecting continued success in both Tier one and Tier two/three deals [40][42] Question: What are the biggest drivers behind the increased Total Addressable Market (TAM)? - Management pointed to growth in fraud products and the Helix business as key drivers for the TAM increase [48][51] Question: How does deregulation impact the company's strategy? - Management noted that deregulation could enhance operational efficiency for clients, providing a positive environment for the company's offerings [60][61] Question: What are the expectations for professional services revenue? - Management indicated that they do not expect a rebound in professional services revenue in the near term, citing ongoing pressures in discretionary spending [100][102]