ON24(US:ONTF)2025-05-07 22:00Financial Data and Key Metrics Changes - Revenue from the core platform, including services, was $34.2 million, representing a decrease of 7% year-over-year [24] - Total revenue for Q1 was $34.7 million, with total subscription and other platform revenue at $32.3 million [24] - Annual Recurring Revenue (ARR) related to the core platform totaled $125.9 million, a decrease of approximately $1.4 million compared to Q4 of 2024 [25] - Positive free cash flow of $2.8 million for Q1, marking the fifth consecutive quarter of positive free cash flow [33] Business Line Data and Key Metrics Changes - Professional services revenue was $2.4 million, representing approximately 7% of total revenue [24] - The percentage of ARR in multi-year contracts increased to over 50% at the end of Q1 [26] - The average core ARR per customer was approximately $78,000, showing a slight increase from the end of 2024 [27] Market Data and Key Metrics Changes - The company experienced softness in international and commercial business segments towards the end of Q1 due to increased macroeconomic uncertainty [26] - The share of life sciences and financial services now represents a third of the business, indicating diversification from technology and manufacturing sectors [73] Company Strategy and Development Direction - The company is focusing on AI innovation, improved enterprise go-to-market execution, and maintaining positive cash flow [11][21] - A new global integrated marketing campaign called "Propel Forward" has been launched to enhance demand generation and brand awareness [15] - The company announced a new $50 million share repurchase program to enhance shareholder value [21][42] Management's Comments on Operating Environment and Future Outlook - Management acknowledged increased macroeconomic uncertainty and decided to take a more conservative approach to near-term revenue guidance [36] - The company expects to be adjusted EBITDA positive in Q2 and for the rest of 2025, with a focus on returning to ARR growth [40][41] - Management expressed confidence in the improvements made in go-to-market execution and customer retention [56] Other Important Information - The company has made significant strides in its go-to-market execution, including enhancements to its leadership team [20] - The gross margin in Q1 was 77%, consistent with previous quarters [29] - The company is committed to generating double-digit EBITDA margins in the long term [42] Q&A Session Summary Question: Insights on the 100k ARR cohort and customer retention - Management indicated they are close to turning the 100k ARR cohort positive, with a focus on enterprise customers [46][48] Question: Softness towards the end of the quarter and its impact on outlook - Management noted increased macro uncertainty and decided to adopt a more conservative approach to annual revenue guidance, particularly for the second half of the year [52][53] Question: Marketing strategies under the new CMO - The new CMO is focused on outcome-driven actions and enhancing demand generation through strong ROI stories [67][71] Question: Performance of different verticals regarding churn and down-sell - Life sciences and financial services are performing better in terms of retention and are now a significant part of the business, contributing to overall growth [73]