Patrick Schulz

Patrick Schulz asked about the top priorities for Sprout Social's go-to-market engine in 2026, considering recent product evolutions like influencer marketing, NewsWhip, and Trellis, and the key message from the sales kickoff led by new CRO Lori Jiménez. He also inquired about the impact of Salesforce's emphasis on Agentforce and other AI solutions in customer care on Sprout's pipeline, and the top priorities for the partner ecosystem this year.

Answer

Ryan Barretto (CEO, Sprout Social) identified multi-product sales as a top priority, driven by customer demand for vendor consolidation and Sprout's integrated workflows across listening, care, and publishing. Trellis and AI were also key themes at the kickoff, with CRO Lori Jiménez focused on enablement and execution. Mr. Barretto reported no change in pipeline behavior due to Salesforce's AI efforts, emphasizing Sprout's unique position as the system of record for social data. He highlighted the successful Salesforce Service Cloud integration as a key partnership and stated that the partner ecosystem priority is to add value by connecting Sprout to tangential products in customers' tech stacks.

Patrick Schulz inquired about the impact of other AI solutions, such as Salesforce's Agentforce, on Sprout Social's pipeline, and the top priority for the company's partner ecosystem this year.

Answer

Ryan Barretto, CEO, stated that there has been no observed change in behavior due to other AI solutions, emphasizing Sprout Social's unique position as a system of record and action for social data. He highlighted the strong partnership with Salesforce Service Cloud for social customer care as a key example and indicated that the top priority for the partner ecosystem is to add value by integrating Sprout into tangential products within customers' tech stacks to streamline workflows.

Patrick Schulz asked about the strategy for rolling out PROS AI agents, specifically the balance between adoption and monetization, and also questioned why full-year EBITDA guidance wasn't raised despite strong performance.

Answer

President & CEO Jeff Cotten emphasized that the immediate focus for AI agents is driving usage and adoption, with plans to develop an outcome-based monetization model in collaboration with early customers. CFO Stefan Schultz explained that the EBITDA outperformance from the first half is being strategically reinvested into sales and marketing initiatives in the second half to support growth.

Patrick Schulz from Baird asked about the drivers behind the raised margin guidance on reiterated revenue and how the company is balancing near-term investments against improved profitability.

Answer

CFO Bill Koefoed attributed the improved margin outlook primarily to slower-than-expected hiring growth. He stated they are thoughtfully calibrating the business, using their own software for scenario planning, and continuing to make product investments to reduce COGS, which provides confidence in the raised guidance.

Patrick Schulz questioned why Workiva maintained its full-year revenue guidance despite noting a more cautious buying environment and asked for an update on demand for ESG and Sustainability solutions following the EU's Omnibus legislation.

Answer

CFO Jill Klindt stated the guidance was maintained due to a strong Q1, confidence in achieving 20% subscription revenue growth, and a large total addressable market. CEO Julie Iskow added that the sustainability market continues to grow, with regulation being only one of several drivers. She noted that while some smaller players might delay, the core target market of large companies in Europe remains intact, and U.S. demand is driven by state rules and business performance needs.

Patrick Schulz from Baird asked about the expected contribution from the SAP relationship in 2025 and sought more color on the puts and takes embedded in the annual guidance.

Answer

Co-CEO Owen Ryan expressed confidence that the building blocks for the SAP partnership are in place for 2025, citing better incentive alignment and a focus on the 'finance first' concept. CFO Mark Partin explained that the full-year guidance implies an inflection point and reacceleration in the second half of the year, with strategic initiatives expected to take root and contribute to growth.

Asked about current customer buying patterns and deal closure rates, and for more detail on go-to-market efficiency investments.

Answer

Executives described a bifurcated market where smaller deals (under 500k) are closing faster while larger deals face continued scrutiny. They emphasized that win rates are at record highs, indicating a macro issue, not a competitive one. Go-to-market investments are focused on improving demand generation efficiency through partners and a transformed SDR/BDR motion, without increasing headcount.