Alexei Gogolev

Alexei Gogolev asked if large customers migrating to the cloud are increasingly consuming all three key products simultaneously rather than line by line, and what factors are driving this change. He also questioned the ARR guidance raise after Q1, comparing it to previous years, and asked if there are any conservative components in the current growth outlook.

Answer

CEO Mike Rosenbaum attributed the trend to Guidewire earning trust for delivering cloud at scale, noting that migrations often involve the complete landscape of existing Guidewire products and sometimes include modernization of other components. CFO Jeff Cooper explained the ARR guidance raise was atypical, driven by the size and scope of Q1 deal activity, pipeline strength, the ProNavigator acquisition, and positive early feedback on new products.

Alexei Gogolev of JPMorgan Chase & Co. inquired about the outlook for fully ramped ARR and the key factors driving Guidewire's success in the Japanese market.

Answer

CFO Jeff Cooper expressed confidence in maintaining upper-teens growth for fully ramped ARR, contingent on Q4 deal closures. CEO Mike Rosenbaum attributed success in Japan to a long-term commitment, significant local investment, and a track record of successful project delivery, positioning Guidewire as the premier P&C platform for the region.

Alexei Gogolev of JPMorgan Chase & Co. inquired about the outlook for fully ramped ARR and the key factors driving Guidewire's success in the Japanese market.

Answer

CFO Jeff Cooper expressed confidence in achieving upper-teens growth for fully ramped ARR, consistent with recent performance, while noting Q4's criticality. CEO Mike Rosenbaum attributed success in Japan to a long-term "commitment," strategic investment, and proven project delivery, positioning Guidewire as the premier P&C platform for the region.

Alexei Gogolev asked what makes management believe AI could be a game-changer for the insurance industry and whether Guidewire is well-positioned with its data access to create a competitive AI offering.

Answer

CEO Mike Rosenbaum expressed excitement about generative AI's potential to boost productivity for development teams, claims adjusters, and underwriters. He also highlighted the opportunity in 'classic AI' using the shared data asset from cloud customers. However, he emphasized that Guidewire's #1 priority remains ensuring the success of every core system implementation, and the company will approach AI development carefully while focusing on its core business.

Alexei Gogolev of JPMorgan requested an update on fully ramped ARR growth and the potential convergence with headline ARR, and also asked for more detail on the cost optimization of moving resources from R&D to COGS.

Answer

CFO Jeff Cooper declined to provide an update on fully ramped ARR, stating it is an annual metric, but did note strong Q1 bookings. He clarified the resource shift was a typical, periodic assessment of DevOps engineer roles to ensure proper expense allocation, not a major strategic change implying reduced hiring needs.

Alexei Gogolev asked about the demand environment in commercial lines, given some reports of market softness, and questioned the future gross margin benefits from the company's AWS contract.

Answer

President & CRO John Mullen acknowledged potential softness in large commercial property but noted that specialty and middle-market segments remain dynamic, emphasizing that core modernization is a long-term decision beyond market cycles. CFO Jeff Cooper stated that while the AWS partnership includes incentives, the primary driver of margin expansion is efficiency gains from investments in the Guidewire Cloud Platform, not the AWS contract itself.

Alexi Gogolev asked for an update on the demand environment and financial health of the pharma end market, and if there were any verbal indications from the remaining six undecided Vault CRM clients.

Answer

Peter Gassner (CEO) described the pharma industry as healthy and steady, with no material changes in customer buying behaviors, driven by ongoing demand for curing diseases. He stated that Veeva would not disclose verbal indications for the remaining Vault CRM clients until decisions are finalized.

Alexi Gogolev inquired about the demand environment and financial health of the pharma end market, and whether Veeva has received any verbal indications from the remaining six undecided Vault CRM clients regarding their commitment.

Answer

Peter Gassner (CEO) described the industry as healthy and accustomed to global challenges, with rapidly evolving science driving demand for cures, maintaining an optimistic and steady outlook. He stated that Veeva would not disclose fine-tuned verbal indications from clients and would only announce commitments when officially notified.

Alexei Gogolev asked about the primary drivers of the strong ARR and NRR acceleration, specifically distinguishing between industry-specific changes like legal market consolidation, macro tailwinds, and internal enterprise sales build-out and productivity improvements. He also questioned if the provided guidance was conservative given the Q1 beat.

Answer

John Hall (Chairman and CEO, Intapp) explained that the acceleration is a combination of industry trends (law firm consolidation, private equity investment in accounting firms, regulatory changes, secular growth in private equity), technology transformation (accelerated cloud adoption post-COVID), and the impact of AI causing firms to re-evaluate IT portfolios. David Morton (CFO, Intapp) stated that the guidance reflects prudence, a cloud-focused approach, and acknowledges moving parts in services and license revenue, allowing the company to execute accordingly.

Alexei Gogolev inquired about the primary drivers of the strong ARR and NRR acceleration, distinguishing between industry-specific changes, macro tailwinds, and internal sales build-out. He also questioned if the fiscal year guidance was conservative given the Q1 beat.

Answer

CEO John Hall identified several contributing factors: industry trends like law firm consolidation, private equity investment in accounting firms, regulatory changes (e.g., AML in Australia), and secular growth in the private equity industry. He also highlighted technology transformation with accelerating cloud adoption post-COVID and AI prompting firms to re-evaluate IT portfolios. Regarding guidance, CEO John Hall stated a commitment to prudence, focusing on cloud/SaaS growth while managing services and license transitions.

Alexei Gogolev asked about the acyclical nature of Intapp's business, inquiring about specific indicators from recent client conversations and the extent to which deal activity drives growth. He also requested the international revenue growth rate in constant currency.

Answer

John Hall, Chairman and CEO, affirmed the business's consistency, stating that the need for professional services firms to adopt cloud and AI technologies provides steady demand, which has been consistent through previous economic cycles. David Morton, CFO, clarified that international revenue growth is almost identical in constant currency as it is primarily conducted in USD.

Alexei Gogolev asked about Intapp's guidance philosophy, the current demand environment compared to previous quarters, and the medium-term trajectory for service gross margins.

Answer

CEO John Hall confirmed that the demand environment and pipeline remain very strong, noting that a recent organizational change led to some back-end loaded deals. CFO David Morton added that the company maintains a prudent guidance philosophy and that the strength of the quarter is also visible in forward-looking metrics like RPOs and billings. Regarding margins, Morton stated that while the services team is overperforming, the official goal remains breakeven, with the primary focus on client satisfaction.

Alexei Gogolev asked for clarification on the implied SaaS revenue mix for the second half of fiscal 2025 and inquired about the expected ratio of new customer acquisition versus expansion.

Answer

CFO David Morton explained that the full-year guidance is prudent, reflecting the ongoing transition from license to cloud revenue and the strategic de-emphasis of services. Regarding customer growth, he stated that while not guided specifically, net new logo ACV has historically represented 20% to 40% of the total, with the remainder coming from the land-and-expand motion.

Aleksei Gogolev inquired about the potential revenue impact from State Street insourcing the FPDR business, asking if it would be felt in 2026 or Q4 of the current year. He also asked how the revenue mix shift, with strong GIDS and GlobeOp growth, would affect the margin outlook, given that Intralinks and WIT previously had higher margins.

Answer

Bill Stone, Chairman and Chief Executive Officer, stated that the State Street insourcing would have a small impact, but SS&C's wind business would still grow, as FPDR was not a core focus, and resources would be reallocated to faster-growing areas. Brian Schell, Chief Financial Officer, explained that GlobeOp already has strong margins above the consolidated average, and GIDS is also working on improving its margins. He noted that the mix shift has not negatively affected overall plans, with a projected greater than 50 basis point EBITDA margin improvement. Bill Stone added that a 39.5% margin is admirable compared to peers.

Alexei Gogolev inquired about the potential revenue impact of State Street insourcing the FPDR business, asking if it would be felt in 2026 or as early as Q4 of the current year. He also questioned how the strong growth in GIDS and GlobeOp, compared to higher-margin businesses like Intralinks and WIT in Q3 2024, might affect the overall margin outlook.

Answer

Chairman and CEO Bill Stone acknowledged a small impact from the State Street insourcing but stated it wasn't a core focus and wouldn't significantly hurt SS&C, allowing resources to be reallocated to faster-growing areas. CFO Brian Schell noted that GlobeOp already has strong margins above the consolidated average, and GIDS is working to improve its margins. He confirmed that the mix shift has not negatively affected overall margin plans, with SS&C projecting a greater than 50 basis point EBITDA margin improvement. Bill Stone highlighted the 39.5% EBITDA margin as admirable compared to peers.

Alexei Gogolev questioned why the full-year organic growth outlook was not raised more significantly after a strong Q2 and asked about the company's comfortable leverage level for future M&A.

Answer

EVP & CFO Brian Schell clarified that the second-half organic growth outlook is roughly equivalent to the first half's, maintaining a strong full-year forecast of 4.5%. Chairman and CEO William Stone stated he would be comfortable with a net leverage ratio in the 'mid-fours,' implying significant capacity for a large, strategic acquisition.

Alexei Gogolev of JPMorgan Chase & Co. asked about the significant outperformance in Q4 organic growth, which came in at 7% versus guidance of under 3%, and questioned the potential risk from European deregulation on the company's regulatory and filing businesses.

Answer

CEO Bill Stone attributed the strong Q4 organic growth to better-than-expected performance across multiple business lines, higher close rates on opportunities, and the contribution of large license deals in the Healthcare business. On the topic of deregulation, Stone stated that while SS&C profits from regulatory services, the company ultimately benefits more when its clients can grow faster with less regulatory burden, viewing it as a net positive.

Alexei Gogolev of JPMorgan Chase & Co. asked what makes Alibaba's current push into QuickCommerce different from its past efforts with Ele.me, which struggled to gain a leading market share against competitors despite significant investment.

Answer

Alibaba Management responded that past investments in Ele.me were crucial for building the merchant and fulfillment infrastructure that enabled the recent rapid growth of Taobao Instant Commerce. The key strategic difference this time is the deep integration with the Taobao app, which provides a massive, highly active user base that was previously a missing component. Furthermore, the investment logic has shifted to focus on the total incremental value QuickCommerce brings to the entire e-commerce ecosystem, rather than its standalone profitability.

Alexei Gogolev of JPMorgan Chase & Co. asked for additional color on the outperformance of health system customers and the current state of the Provider Solutions business.

Answer

CFO Anna Bryson stated that while pharma remains the primary growth driver, the health system business has improved across all its solutions. The enterprise offering is a particular bright spot, with 17 of the top 20 health systems signed and strong adoption of the on-call scheduling tool. However, she noted the guidance remains cautious for this segment due to the policy uncertainty these customers face.

Alexei Gogolev of JPMorgan Chase & Co. requested organic vs. inorganic guidance, sought clarification on the expected second-half growth acceleration, and asked about the investment plans and margin impact now that cost synergies have been realized.

Answer

CFO Jim Cox provided the underlying growth assumptions for the guidance (Core ~20%, Infusion ~13%, Beacon ~20%) and confirmed the expected acceleration is in sequential revenue. CEO Sandeep Sahai stated that the margin expansion opportunity remains unchanged, as investments are focused on reallocating resources rather than new spending, and that the leadership team has a proven playbook for driving growth and efficiency.

Alexei Gogolev asked about the foreign exchange headwinds incorporated into the 2025 guidance and what the growth outlook would be on a constant currency basis. He also requested more detail on the specific use case for the new client, OpenAI.

Answer

CFO James Cox explained that the FX impact on EBITDA is de minimis due to natural hedges, and while there is a slight headwind on revenue, most contracts are in USD. CEO Sandeep Sahai added that the large employee base in India could provide a mild cost tailwind. Regarding OpenAI, Sandeep Sahai clarified that Clearwater provides the same core services as for any other corporate client—data ingestion, reconciliation, accounting, and reporting—with the primary use case being the consolidation of reports from multiple asset managers.

Alexei Gogolev asked about the implied Q4 EBITDA margin decline, the commitment to 200 bps of margin expansion next year, and the potential financial impact from the new Snowflake integration.

Answer

CFO Jim Cox reaffirmed the commitment to 200 bps of margin expansion next year, explaining that Q4 includes strategic investments in go-to-market and product to fortify long-term growth. CCO Subi Sethi and CEO Sandeep Sahai noted the Snowflake integration will improve onboarding times and contribute to gross margin improvement.

Alexei Gogolev of JPMorgan Chase & Co. inquired about the evolution of sales cycles since Q1 and any specific improvements observed in the sales pipeline as the macroeconomic environment shows signs of stabilizing.

Answer

President & CEO Lynn Moore stated that broader market uncertainty seems to be loosening. He noted that while some deals were delayed from Q1, the demand for their mission-critical systems remains strong. As an example of improving market activity, he mentioned that RFPs in their ERP space were up 25% since Q1, and they expect decision-making to continue to increase sequentially through the year.

Alexei Gogolev of JPMorgan Chase & Co. asked if the company is still on track to meet its full-year target for on-premise-to-cloud conversions (flips), given the 106 flips completed in Q1.

Answer

President and CEO Lynn Moore noted that the number of flips was up 18% year-over-year and that the total contract value from flips was on track. CFO Brian Miller added that while no specific annual target was set, the company's full-year expectations for flips remain unchanged, acknowledging quarterly fluctuations.

Alexei Gogolev asked about Tyler's payments strategy, specifically its focus on profitability, the implications of the expanded Fiserv partnership, and the level of investment in AI with partners like AWS.

Answer

CEO H. Moore explained that Tyler is strategically moving away from low-margin, commoditized payments, like the inherited Texas contract, to focus on differentiated, integrated offerings. He positioned the Fiserv partnership as a way to leverage their technology to enhance Tyler's high-value services, ultimately driving better margins. Moore also confirmed significant 2025 investments in AI, supported by partners like AWS, with new features expected to be unveiled at the company's Connect conference.

Alexei Gogolev asked about the competitive landscape, specifically pressure from players like ServiceNow and Workday, and sought directional commentary on the 2025 outlook for top-line growth and free cash flow margin.

Answer

CEO Lynn Moore characterized the competitive landscape as 'pretty neutral' with consistent win rates and no significant change in pressure. Regarding 2025, CFO Brian Miller stated that while formal guidance is not yet available, the company is tracking ahead of its 2025 targets and expects to build upon the current year's strong free cash flow performance.

Alexei Gogolev inquired about booking momentum and demand trends following the PegaWorld conference and asked if the company's margin expansion outlook could be considered conservative.

Answer

Founder & CEO Alan Trefler reported that PegaWorld generated significant interest and follow-up, leading to a 'nicely increasing' pipeline that will benefit future years. COO & CFO Kenneth Stillwell stated that while there is 'zero risk' on cost management, achieving margin expansion is dependent on hitting growth targets, though they naturally aim to exceed their guidance.

Alexei Gogolev asked about seasonality in commercial bookings, excluding Apartments.com, and whether it was normal for them to be broadly unchanged quarter-over-quarter.

Answer

CFO Christian Lown and CEO Andy Florance explained that there is no significant seasonality. They noted that CoStar bookings are generally stable but can see a lift in Q4, while LoopNet's historical seasonality has been eliminated. They anticipate Homes.com will eventually develop a strong Q2 seasonality.

Alexei Gogolev of JPMorgan Chase & Co. inquired about seasonality in commercial bookings, excluding Apartments.com, and whether it was normal for this metric to be relatively flat quarter-over-quarter.

Answer

CFO Christian Lown and CEO Andy Florance explained that commercial bookings have limited seasonality. CoStar Suite historically sees a stronger fourth quarter, while LoopNet's previous Q4 negative seasonality has been eliminated due to strategic changes. They anticipate Homes.com will eventually develop a strong Q2 seasonality, similar to Apartments.com.

Alexei Gogolev of JPMorgan Chase & Co. inquired about the industry reaction to Zillow's policy on delayed market listings and asked for the non-residential EBITDA margin and the 2025 residential spending outlook.

Answer

CEO Andrew Florance stated the reaction from agents to Zillow's policy has been "overwhelmingly negative," viewing it as a sign of weakness. CFO Christian Lown reported that the commercial margin was 43% in Q1 and confirmed that the spending outlook for the residential segment (Homes.com) remains on track with original plans.

Alexei Gogolev asked for clarification on Homes.com spending for 2025, its impact on margins, and the investment priorities across content, SEO, and advertising.

Answer

CFO Christian Lown stated that Homes.com spending in 2025 is expected to be broadly in line with 2024, with a focus on harvesting growth in the U.K. CEO Andrew Florance clarified that the primary investment shift in 2025 is towards growing the sales force headcount, while costs in other areas like content are being controlled after significant progress was made in prior periods.

Alexei Gogolev of JPMorgan Chase & Co. asked for specific details about the large win with a U.S. county, inquiring about the key features that drove the decision and whether it was related to needs for natural disaster response.

Answer

Co-Founder and CEO Sanjit Biswas highlighted two primary use cases for the county win. The first was driving operational efficiency through better asset utilization and reduced fuel consumption. The second was enhancing public safety and disaster response, such as being able to locate critical assets like generators after a storm, which is highly valuable for ensuring citizen safety.

Alexei Gogolev from JPMorgan Chase & Co. asked for clarification on the amount of inorganic Annual Recurring Revenue (ARR) growth during the quarter.

Answer

Chief Financial Officer Bryan Hill stated that Alkami's organic ARR growth was 22% for the quarter. This implies the remaining 11% of the total 33% reported ARR growth was inorganic, primarily from the MANTL acquisition.

Speaking on behalf of Alexei Gogolev, Elyse Kanner requested a more precise breakdown of the revised revenue guidance, asking how much was attributable to currency tailwinds versus inorganic growth from acquisitions. She also asked about the expected trajectory for reaching the 60% cloud adoption target for customers.

Answer

CFO Roni Giladi stated that while a precise split could not be provided due to the unknown closing dates of the acquisitions, the vast majority of the $21 million incremental revenue guidance comes from M&A, with a smaller portion from currency tailwinds. Regarding cloud adoption, he reiterated that nearly all new deals are on the cloud and the company continues to migrate existing customers, with a detailed update on the percentage to be provided at year-end.

Alexei Gogolev requested elaboration on the increase in top-10 customer concentration, the expected pace of cloud migrations to reach the 5-year target, and the characteristics of the 36 deals signed in 2024, including ARR contribution and business line mix.

Answer

CFO Roni Giladi stated that the customer concentration metrics are strong, with the largest customer at only 4% of revenue, posing no material risk. He explained the goal to reach 60% cloud adoption will be achieved by signing all new deals on the cloud and accelerating migrations of existing customers from 10 in 2024 to 15-30 per year going forward. He noted that all new logos contribute to ARR and that the 36 deals signed were spread across all business lines.

Alexei Gogolev asked for clarification on Bentley's ARR exposure to India and Pakistan, given recent military events between the two countries.

Answer

Executive Chair Greg Bentley explained that while Bentley has a significant R&D center in Pakistan, it is not a large market. In contrast, India is a net exporter for the company due to massive infrastructure spending. CEO Nicholas Cumins confirmed India was the main growth driver in APAC in Q1, benefiting from both local investment and outsourced engineering work. He noted that despite strong growth, India still represents a single-digit percentage of total ARR.

Alexei Gogolev inquired about the competitive environment over the past year, noting that some competitors have claimed to be taking market share from Bentley.

Answer

CEO Nicholas Cumins asserted that Bentley is not losing share. He explained that competitors focused on commercial facilities are attempting to enter the infrastructure market due to a slowdown in their core business, sometimes resorting to significant price cuts. However, he noted that customers are remaining loyal to Bentley due to its dedicated infrastructure focus and comprehensive product portfolio.

Alexei Gogolev sought confirmation of the Q1 organic growth rate excluding the EvolutionIQ acquisition and asked for an estimate of the current share of consumer self-pay for auto repairs.

Answer

CFO Brian Herb confirmed that EvolutionIQ contributed 4 percentage points to growth, with the balance representing core CCCS growth. CEO Githesh Ramamurthy estimated that consumer self-pay for repairs has increased to about 25% from approximately 11-12% three years ago, noting that repair facilities are using CCCS tools to capture this business.

Alexei Gogolev inquired about the drivers of the 2025 organic revenue growth forecast, the expected revenue ramp from the EvolutionIQ acquisition, the adoption timeline for emerging solutions, and the recent trends in claims volume.

Answer

CFO Brian Herb explained that the organic growth forecast is at the lower end of the 7-10% long-term range, with the EvolutionIQ acquisition's revenue contribution expected to scale throughout 2025. Herb noted that emerging solutions, while growing over 30%, are still projected to contribute about 1 point to growth, with an inflection point not yet being called. He also mentioned that claims volume moderated in Q4 but the 2025 forecast does not assume a significant change from 2024 levels. CEO Githesh Ramamurthy added that adoption of new solutions is increasing across the board.

Speaking on behalf of Alexei Gogolev, Elyse Kanner asked for the reason behind the sequential growth in stock-based compensation (SBC) and the outlook for next year, and also inquired about challenges with the subrogation product rollouts.

Answer

CFO Brian Herb attributed the high SBC to a one-time P&L charge from a TSR modification, which will mostly run through in 2024. He guided for SBC to normalize to 12-14% of revenue in 2025. He also explained that the company is focused on inbound subrogation first, as it is less complex to integrate than outbound subrogation, and is seeing significant adoption and a strong pipeline.

On behalf of Alexei Gogolev, Eleanor Smith asked for a ranked order of the products driving the 9% ARPU growth and for an update on the internal AI tool, GABI, including its potential to become customer-facing.

Answer

CFO Mark McCaffrey explained that the strong ARPU growth is a result of the entire strategy working in concert—including pricing, bundling, and Airo—which drove higher bookings that are now reflected in trailing revenue. He did not rank individual products. CEO Aman Bhutani expressed excitement about GABI's continued evolution and its integration with external-facing bots, but stated there are no immediate plans to make GABI itself an external product, noting the rapid pace of change in AI.

Alexei Gogolev of JPMorgan Chase & Co. inquired about recent market share dynamics and the educational process required for customers to adopt AI Agents.

Answer

CEO Tooey Courtemanche stated that while win-rate data is disclosed annually, the strong competitive position shared at Investor Day remains unchanged. He agreed that a significant educational opportunity exists for AI Agents, noting that while the concept is new, customers are extremely excited by the potential to automate work and improve margins.

Sought specific clarification on the components of the 2024 back book guidance, asking about the assumed churn rate and organic growth rate, and the reasons for the recent weakness in organic growth.

Answer

The company confirmed an expected churn rate in the 3-5% range and acknowledged that the organic growth component was weaker in Q2. This weakness was not concentrated in any specific geography or client type but was a broad-based trend of minor seat/connection reductions. They confirmed the potential for a delay in hitting NRR targets but reiterated the overall guidance.

Requested an update on U.S. market dynamics, including the impact of the Utah Retirement Systems win, and asked if the 2024 guidance anticipates a greater share of revenue from managed services given the move upmarket.

Answer

The U.S. business is healthy and diversified, and the Utah win is a recent booking not yet reflected in revenue. The company does not anticipate a greater share of managed services in its 2024 guidance; the focus remains on the core platform, with managed services offered as part of a package rather than a lead product.