Sprinklr(US:CXM)2025-12-03 14:32Financial Data and Key Metrics Changes - Total revenue for Q3 grew 9% year-over-year to $219.1 million, while subscription revenue increased 5% year-over-year to $190.3 million [5][16] - Non-GAAP operating income was $33.5 million, resulting in a 15% non-GAAP operating margin for the quarter [5][20] - Professional services revenue was $28.8 million, driven by large CCaaS rollouts, with a net dollar expansion rate of 102% [17][18] - Non-GAAP subscription gross margin was 77%, and total non-GAAP gross margin was 67% [19][20] Business Line Data and Key Metrics Changes - The company is focusing on Project Bear Hug, which aims to deepen engagement with the top 700 customers, representing over 80% of total revenue [9] - The revenue contributed by the $1 million customers' cohort increased by 9% year-over-year, with a net dollar expansion rate of 113% [18] Market Data and Key Metrics Changes - Total remaining performance obligations (RPO) were $857.6 million, down 5% year-over-year, while current RPO was $562.2 million, up 3% year-over-year [21] - The company expects total billings of approximately $320 million for Q4, traditionally the strongest quarter [22] Company Strategy and Development Direction - The company is in a transformation phase, focusing on improving its position in the customer experience market and leveraging its AI-powered platform [6][8] - The strategy includes enhancing customer engagement through first-party data and personalized omnichannel experiences [6][14] - The leadership team has been strengthened with new appointments, including a new CFO and Chief Product and Corporate Strategy Officer [5][6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategy and commitment to driving sustainable growth and long-term shareholder value [8][14] - The company is optimistic about improving renewal rates and customer engagement metrics, indicating a stronger position than at the start of the year [8][14] - Management acknowledged that transformation takes time and emphasized the importance of executing several quarters together to establish a solid foundation [30][75] Other Important Information - The company generated $15.5 million in free cash flow in Q3 and $126 million year-to-date, with a strong balance sheet of $480.3 million in cash and no debt [20] - The company raised its full-year revenue guidance, now expecting total revenue in the range of $853 million to $854 million, representing 7% growth year-over-year [24] Q&A Session Summary Question: How sustainable is the revenue performance as the company heads into next year? - Management indicated that while Q3 showed good performance, it is essential to string several quarters together to assess sustainability [29][30] Question: What is at risk with Project Bear Hug, and what outcomes can be expected? - Management explained that Bear Hug aims to deepen customer relationships, and successful engagement can lead to better renewal rates and reduced churn [32][36] Question: How is the company stabilizing its leadership bench amid recent changes? - Management stated that most senior leadership changes are complete, and the current team is experienced and aligned with the company's strategy [40][42] Question: How did renewals in Q3 compare to expectations, and what is anticipated for Q4? - Management reported that renewal rates met or exceeded expectations in Q3, and they are actively managing renewals for upcoming quarters [49][50] Question: Can you provide an update on pricing and bundling initiatives? - Management confirmed that the first phase of new pricing and bundling has been implemented with positive early feedback, and plans to expand this to existing customers are underway [58][60]