Release Date: March 12, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you discuss Upland's AI strategy and its impact on growth? A: Jack McDonald, CEO: Upland has invested significantly in AI, enabling 80% of our core content and knowledge management products. Products like BA Insight and Panviva are now AI-enabled, enhancing enterprise search and customer service. This AI strategy is foundational for our growth, with notable sales like a $500,000 ARR deal for Qvidian's AI Assist. We expect AI to drive higher growth rates in the coming years.
Q: What is the status of Upland's asset divestiture strategy, and what were the proceeds from recent sales? A: Mike Hill, CFO: We sold two non-strategic product lines for about $10 million in total. The revenue from these divested assets was $18 million, but they had no impact on adjusted EBITDA. The divestitures help focus our business and improve core organic growth.
Q: How is Upland addressing its debt, and what are the plans for refinancing? A: Jack McDonald, CEO: We have paid down $261 million in debt since the HGGC investment. Our current debt is hedged at a 5.4% interest rate, and we plan to continue paying down up to $2 million per month. We aim to refinance in the second half of this year, considering the attractive current rate and lower principal amount.
Q: Can you elaborate on the improvement in net dollar retention rates? A: Jack McDonald, CEO: The improvement to a 96% net dollar retention rate is driven by better gross dollar retention, thanks to product investments and focusing on our strongest products. We aim to reach a 98% retention rate by the end of 2025, with expansion opportunities from AI-enabled products.
Q: Why is there a wide range in the Q1 revenue guidance? A: Mike Hill, CFO: The guidance range of $59 million to $65 million is consistent with past quarters. The range accounts for variability in perpetual license and professional services revenue, which can be lumpy.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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