Verint(VRNT)2024-12-05 00:09Financial Data and Key Metrics Changes - In Q3 2025, revenue reached $224 million, exceeding guidance by approximately $14 million, representing about 5% year-over-year growth when adjusted for last year's divestiture [11][27] - Non-GAAP diluted EPS was $0.54, approximately $0.11 ahead of guidance [13][29] - Gross margin expanded to 72%, up approximately 70 basis points year-over-year, reflecting a favorable shift towards higher-margin recurring revenue [28] Business Line Data and Key Metrics Changes - Bundled SaaS revenue increased by 19% year-over-year, an acceleration from previous quarters, driven by AI momentum [12][30] - Unbundled SaaS revenue was reported at $73 million, ahead of expectations, with a forecast of around $100 million for Q4 due to a large pool of renewals [31] - New SaaS ACV bookings increased by 37% year-over-year in Q3 [36] Market Data and Key Metrics Changes - SaaS ARR increased by 11% year-over-year, driven by AI adoption, with expectations for double-digit growth in Q4 [37] - The company reported strong customer outcomes from AI deployments, with significant savings reported by clients in various sectors [16][18] Company Strategy and Development Direction - The company aims to maintain its leadership in the CX automation market, emphasizing its unique hybrid cloud model that allows for quick AI integration without disruptive infrastructure changes [44][50] - The focus on AI innovation is expected to drive future growth, with plans to showcase these advancements at the upcoming Investor Day [23][41] Management's Comments on Operating Environment and Future Outlook - Management noted that the contact center market is in the early stages of AI adoption, with increasing customer demand for tangible AI business outcomes [19][70] - There is an expectation for improved sales cycles in 2025 as customers gain a better understanding of AI solutions [67][71] Other Important Information - The company completed a tuck-in acquisition during Q3, contributing approximately $1 million in revenue, with potential for several million in Q4 [54][57] - The company is executing a $200 million share repurchase program and plans to expand on its capital allocation strategy during the Investor Day [39] Q&A Session Summary Question: Is Verint gaining market share in the contact center arena? - Management believes Verint is leading the CX automation market and gaining share due to strong customer-reported outcomes and a unique platform offering [44][46] Question: Can you provide details on the recent tuck-in acquisition? - The acquisition involved a startup focused on AI technology, contributing about $1 million in Q3, with potential for more in Q4 [54][57] Question: Are customers seeing changes in seat counts and net spending? - Some customers are reducing workforce while others are reallocating agents to focus on relationship building, indicating varied strategies in response to AI deployment [60][62] Question: How is the partnership with RingCentral expected to impact growth? - The partnership aims to enhance cloud-to-cloud integration, providing customers with seamless access to Verint's capabilities, expected to be a growth engine in 2025 [75][76] Question: What were the key announcements from the recent Engage conference? - The conference highlighted customer success stories and the introduction of new bots, with a focus on bundling capabilities to enhance customer experience [78][81]