Vijay Devar

The analyst, asking on behalf of Mike Latimore, inquired about sequential booking improvements in Q2, the status of the product pipeline, and the comparative demand for service versus sales use cases.

Answer

The company confirmed that sales (ACV) were sequentially higher in Q2. They detailed the product pipeline, highlighting the new Engage platform and upcoming launches like benchmarking, Marchex GPT, and agent assist as key growth drivers. They also noted increasing demand and average revenue for their service use case, particularly within the auto dealer channel, which they believe positions them well for future growth.

Vijay Devar of Northland Capital Markets, on behalf of Mike Latimore, inquired about sequential improvement in Q2 bookings, the status of the sales pipeline, and the demand for the company's service use case versus its sales use case.

Answer

Russell Horowitz, Chairman of the Board, confirmed that sales, or Annual Contract Value (ACV), was sequentially higher. He elaborated on the product pipeline, highlighting the live Marchex Engage platform and upcoming launches like Marchex GPT and agent assist. Horowitz also noted increasing average revenue per sale for the combined sales and service offering, with growing uptake in the auto dealer channel.

Vijay Devar, on behalf of Mike Latimore, asked for guidance on modeling Q3 versus Q4 revenue and for clarification on the key growth drivers for the second half of the year.

Answer

CFO Nitesh Sharan stated that revenue is expected to ramp in the second half, with Q4 being stronger than Q3 due to typical seasonality, European summer holidays, and year-end budget deployments. He identified the key drivers as continued growth across all three pillars (Enterprise, Restaurants, Auto), expansion within existing customer accounts, and accelerating contributions from indirect channel partnerships.

Vijay Devar from Northland Capital Markets asked for a timeline on completing the integration of Ooma apps into the 2600Hz platform and whether the Metaswitch acquisition by Microsoft has changed the sales cycle for 2600Hz.

Answer

CEO Eric Stang estimated the full integration of Ooma IP onto the 2600Hz platform would be complete by the end of the current fiscal year. He found it hard to say if the market had changed post-Metaswitch acquisition but highlighted that Ooma's sales team is having fantastic success, winning multiple new customers in Q1 who chose 2600Hz over competitors.

Vijay Devar from Northland Capital Markets, on for Mike Latimore, asked about the timeline for completing the integration of Ooma apps into the 2600Hz platform and whether the sales cycle for 2600Hz has changed.

Answer

CEO Eric Stang projected that the full integration would be finished by the end of the current fiscal year. While he found it difficult to comment on a change in the sales cycle, he highlighted strong momentum, evidenced by a record number of new customer wins in Q1, indicating that the platform is being chosen over competitor solutions.

Inquired about the number of operational data centers, the deployment schedule to reach the year-end target, and the potential for securing a deal with a hyperscaler.

Answer

The company has one commercialized data center, with two more being installed. They plan to add 2-3 per quarter to reach 15 by year-end. They are in active discussions with several large hyperscalers for both power and edge data center services, viewing this as a significant opportunity.

Vijay Devar of Northland Capital Markets inquired about the number of currently operational edge data centers and the deployment cadence planned to reach 15 units by year-end. He also asked about the potential for securing a hyperscaler as a customer and if this would be an upside to guidance.

Answer

Executive Charles Ferry confirmed one data center is commercialized, with two more in installation, and the company is on track to install 2-3 pods per quarter to meet its year-end goal. He noted that Duos is in active discussions with major hyperscalers for both power and edge computing, viewing a potential deal as an upside to current plans.

Speaking for Mike Latimore, Vijay Devar of Northland Capital Markets inquired about the adoption rate of the Copilot feature among global intelligence customers and asked about its impact on upsell and cross-sell activities during the quarter.

Answer

CFO and CIO Jon Slabaugh stated that the feature is available to all subscribers but the company does not disclose specific usage metrics. President and CEO Josh Resnik added that qualitatively, usage has been very good and the Copilot has been helpful in driving product-led sales, but reiterated that specific metrics are not provided.