Q1 2025 Intapp Inc Earnings Call

Thomson Reuters StreetEvents2024-11-06

Participants David Trone; Senior Vice President, Investor Relations; Intapp Inc John Hall; Chairman & Chief Executive Officer; Intapp Inc David Morton; Chief Financial Officer; Intapp Inc Steve Enders...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap

Leave a comment

{"i18n":{"language":"en_US"},"isChannel":false,"data":{"share":"https://ttm.financial/m/news/2481463921?lang=en_US&edition=fundamental","thumbnail":"","is_english":true,"pubTime":"2024-11-06 02:13","share_image_url":"https://static.laohu8.com/5f26f4a48f9cb3e29be4d71d3ba8c038","id":"2481463921","market":"us","top_or_hot":-1,"title":"Q1 2025 Intapp Inc Earnings Call","media":"Thomson Reuters StreetEvents","content":"<div>\n<p>Participants\nDavid Trone; Senior Vice President, Investor Relations; Intapp Inc\nJohn Hall; Chairman & Chief Executive Officer; Intapp Inc\nDavid Morton; Chief Financial Officer; Intapp Inc\nSteve Enders...</p>\n\n<a href=\"https://finance.yahoo.com/news/q1-2025-intapp-inc-earnings-181336116.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Q1 2025 Intapp Inc Earnings Call</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nQ1 2025 Intapp Inc Earnings Call\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-06 02:13 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/q1-2025-intapp-inc-earnings-181336116.html><strong>Thomson Reuters StreetEvents</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Participants\nDavid Trone; Senior Vice President, Investor Relations; Intapp Inc\nJohn Hall; Chairman & Chief Executive Officer; Intapp Inc\nDavid Morton; Chief Financial Officer; Intapp Inc\nSteve Enders...</p>\n\n<a href=\"https://finance.yahoo.com/news/q1-2025-intapp-inc-earnings-181336116.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"MSFT","symbol_name":"微软","start_time":0,"source_url":"https://finance.yahoo.com/news/q1-2025-intapp-inc-earnings-181336116.html","article_id":"2481463921","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2481463921","pubTimestamp":1730830416,"columns":[],"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"David Trone; Senior Vice President, Investor Relations; Intapp Inc. Cody Kiechle; Analyst; Bank of America Merrill Lynch. Thank you, David. Good afternoon, everyone. Thank you for joining us today as we share the results of our fiscal first quarter. Commencing our fourth fiscal year as a public company, I'm pleased to share that once again, we've achieved strong quarterly results supported by cloud ARR growth, new products, new partnerships, new logos, and expanded client ac","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":["earning"],"viewcount":null,"language":"en","relate_stocks":{"MSFT":"微软","INTA":"Intapp, Inc."},"translate_title":"2025年第一季度Intapp Inc收益看涨期权","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"INTA":1,"MSFT":0.9},"content_text":"Participants\nDavid Trone; Senior Vice President, Investor Relations; Intapp Inc\nJohn Hall; Chairman & Chief Executive Officer; Intapp Inc\nDavid Morton; Chief Financial Officer; Intapp Inc\nSteve Enders; Analyst; $Citigroup Inc(C-N)$\nKevin McVeigh; Analyst; UBS Group AG\nAlexei Gogolev; Analyst; JPMorgan Chase & Co\nCody Kiechle; Analyst; Bank of America Merrill Lynch\nAlex Sklar; Analyst; Raymond James Financial Inc\nSaket Kalia; Analyst; Barclays Capital Inc\nParker Lane; Analyst; Stifel Financial Corp\nTerry Tillman; Analyst; Truist Securities Inc\nArvind Ramnani; Analyst; Piper Sandler & Co\nBrian Schwartz; Analyst; Oppenheimer & Co Inc\nPresentation\nOperator\n Good day and thank you for standing by. Welcome to Intapp fiscal first-quarter 2025 webcast. (Operator Instructions) Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, David Trone, Senior Vice President, Investor Relations. David, please go ahead.g\nDavid Trone\n Thank you. Welcome to Intapp's fiscal first-quarter 2025 Financial Results. On the call with me today are John Hall, Chairman and CEO of Intapp; and David Morton, Chief Financial Officer. During the course of this conference call, we may make forward-looking statements regarding trends strategies and the anticipated performance of our business, including guidance provided for our fiscal second quarter and full year 2025. These forward-looking statements are based on management's current views and expectations that are difficult to predict and could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Intapp disclaims any obligation to update or revise any forward looking statements, except that's required by law. Further on today's call, we will also discuss certain non-GAAP metrics that we believe aid in the understanding of our financial results, including non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income. Non-GAAP diluted net income per share and free cash flow. As a reminder, all of our financial figures we will discuss today are non-GAAP, except for revenue and revenue growth and total remaining performance obligations. Our financial results, along with reconciliation of GAAP to non-GAAP financial measures, can be found in today's earnings release and its supplemental financial tables, which is available on our website and as an exhibit to the Form 8-K furnished with the SEC prior to this call, or a supplemental financial presentation, which is available on our website. With that, I'll hand the conversation over to John.\nJohn Hall\n Thank you, David. Good afternoon, everyone. Thank you for joining us today as we share the results of our fiscal first quarter. Commencing our fourth fiscal year as a public company, I'm pleased to share that once again, we've achieved strong quarterly results supported by cloud ARR growth, new products, new partnerships, new logos, and expanded client accounts around the world. We also added new applied AI capabilities to our platform and furthered our strategic partnership with Microsoft. I'll share details on these select growth drivers throughout this call. In Q1, our cloud ARR grew to $309 million, up 27% year over year. Cloud now represents 74% of our total ARR of $417 million. In the quarter, we earned SaaS revenue of $77 million, up 30% year over year, and total revenue of $119 million, up 17% year over year. Now, I'd like to share some highlights from our fiscal first quarter. I'll start with how we're executing on our vertical AI roadmap, specifically our continued applied AI innovation, its practical applications, and our increasing client adoption. First, we introduced two new AI powered features for Intapp Assist for DealCloud. As you may remember, Intapp Assist brings Generative AI to the daily work of professionals, helping them better apply their intelligence, while driving speed and accuracy. Intapp Assist now helps professionals make sourcing recommendations to help professionals quickly identify ideal target companies aligned with firm strategy, such as ideal investment candidates. And Intapp Assist now provides smart tagging to help professionals analyze and organize communications and meeting notes, making complex data easier to search and apply. We are excited that rising client adoption of Intapp Assist for DealCloud is validating our applied AI strategy and its capability to drive tangible results and positive outcomes for our clients. For example, [Serena Clay], Director of International Marketing and Communications at International Investment Bank DC Advisory said, I think a lot of the time what other companies are saying their AI tools can do can be quite performative. But I think the depth to which DealCloud has demonstrated commitment to it, and also their thought process and roadmap for it has been really impressive. Second, we expanded the Intapp Assist product brand by announcing the general availability of Intapp Assist for terms. This new generative AI feature makes it easier for legal professionals to comply with client terms by giving them immediate answers to their questions about contractual terms right in Microsoft Teams. This significantly reduces the time and research needed to comply with outside council guidelines and the firm's client and engagement letter commitments. And it's another example of how we reach professionals in the Microsoft apps they're already using every day, easing adoption and furthering their success. As Carly Numrich, Risk Council at Fredrikson & Byron said, our staff no longer have to go into Intapp terms and search for the right document or contact me with a question. Now, they're able to pull up Microsoft Teams and ask it terms questions, such as what are my payment terms with this client? And Intapp Assist provides the answer. It's a much more streamlined process. And we're excited to share that Intapp Walls for Copilot is gaining traction in the market as more firms look to apply trusted AI. The solution helps professionals use Microsoft Copilot AI in a secure, compliant manner, while avoiding revealing protected information. We continue to see opportunity to expand our compliance footprint and help firms benefit from AI, while adhering to their regulatory, ethical, and client commitments. As Tori Carrillo, the application manager from law firm, Nelson Mullins, told us, because we use in tap walls to enforce access rules across our networks and applications, I can confidently point Microsoft Copilot wherever we want. And Copilot will pull only from matters that the user has permission to access. These new AI features and capabilities are great examples of how our co-innovation with Microsoft is helping to propel our applied vertical AI strategy. Speaking of Microsoft, I'll now turn to partnerships and share how we're expanding our robust partner ecosystem to drive growth. Microsoft continues to be one of our most prominent partners. We're proud to have launched fiscal '25 with renewed top tier and global ISV partner status with Microsoft, based on strong, joint go-to-market activity and Co-sale success. We continue to grow the number and volume of transactions through the Azure Marketplace in Q1, applying to clients in all our verticals and for both land and expand deals. For example, this quarter, one of the world's largest multinational investment banks significantly increased its number of DealCloud seats for its capital formation team, as it made the use of DealCloud mandatory for specific roles and approval process. Next, Cassels Brock & Blackwell, one of the largest business law firms in Canada, purchased in-tap conflicts from the Azure marketplace to manage its conflicts clearance process, reputational risk, and adopt a solution that can scale with the firm's rapid growth. Additionally, our updated partner program, launched a year ago, continues to attract new partners in our target markets. We now have 135 data, technology, and services partners in the program. We're also excited about another six partners who joined the program last quarter, five of which are DealCloud integration partners that bring additional data sets to our already robust platform. Let's turn now to Q1, wins and cloud migrations, and share some examples of how we're continuing to grow our client base, expand with existing clients, migrate clients to the cloud, and gain traction in new markets. First, I'm pleased to share that we're continuing to grow through the addition of new clients, including Crete PA, a private equity-backed network of accounting and professional services firms, which selected Intapp conflicts to centralize, systematize, and simplify the conflicts clearance process for its member firms. Next, a nationally recognized restructuring and financial advisory firm, which chose Intapp Conflicts and IntappIntake to support its growth through acquisition. We chose these as illustrations of the growing need for compliance checking by accounting firms, as growth through private equity investment and acquisitions increase in that vertical. We see this trend as a significant growth area for Intapp. And as we continue to win new clients across all our verticals, both domestically and internationally, here are some examples. In the US, a top-ranked venture capital firm focused on revolutionary technologies, chose DealCloud for its robust CRM capabilities for investor tracking, investor reporting, and pipeline management. Next, internationally, TGS Baltic, a leading commercial law firm operating across the Baltic states, chose DealCloud to improve its client account program structure and effectiveness, drive cross-selling, and improve identification of new sales opportunities. Additionally, cross-selling and upselling success in our existing accounts continue to drive strong net revenue retention. A few notable examples include: national CPA and consulting firm, Forvis Mazars, which uses Intapp employee compliance to manage personal independence and recently expanded its relationship with Intapp. The firm added DealCloud to now support its capital advisors team by leveraging AI to manage complex deals more efficiently. Next, a multinational law firm and longtime user of our risk and compliance solutions chose DealCloud to support its private equity team. Next, a fast growing business advisory interim management and investment banking firm increased its number of DealCloud seats by almost [400%]. And moving on to cloud migrations, we had steady progress here as well this quarter, including AmLaw 200 firm, Honigman, which chose to migrate its four Intapp compliance solutions to the cloud, so it could gain access to the latest applied AI and streamline its internal processes. Finally, a New York-based AmLaw 100 firm chose to migrate its instance of impact time to the cloud, supporting its goals of achieving more compliant time and billing, more efficient and profitable matter management, and increased client satisfaction. In conclusion, we're proud of our strong performance in the first quarter and we're optimistic about our continued growth opportunities. As our Q1 performance has shown, we continue to grow by adding new capabilities to our platform and increasing our global and enterprise go-to-market reach. We see continued opportunity both to add new clients across a broad TAM and to deliver greater value by expanding within our existing client base. We're serving a durable end market with our subscription revenue model, industry specific cloud platform, and applied AI and compliance capabilities. We have a great growth opportunity to drive AI, cloud adoption, and modernization across all the industries we serve. As always, I'd like to thank our clients, our partners, our investors, our Board, and our global Intapp team for their teamwork and dedication. Thank you all very much. Okay, David. Over to you.\nDavid Morton\n Thanks, John, and thank you, everyone, for joining us today. I'm pleased to report a strong first quarter performance driven by solid SaaS revenue growth, an expanding client base, and enhanced operational efficiency. Together, these achievements position us to extend our leadership, as we pursue an exciting market opportunity in fiscal Q2 2025 and beyond. As we begin our fourth fiscal year as a public company, we announced a strategic shift in February focusing on our cloud business over on-premise and service offerings. Accordingly, our disclosures will now highlight SAS revenue and cloud metrics. Starting this quarter, our income statement separates SaaS revenue from on-premise support to better highlight the growth trajectory in our cloud business. For fiscal Q1, SaaS revenue was $76.9 million, up 30% year over year, driven by new client acquisitions, contract expansions, and the migration of on-premise products to the cloud. As of fiscal Q1, 92% of our clients have adopted at least one cloud module. As a reminder, our previous disclosure of subscription license included the upfront portion of our on-premise contract. We now report this as license revenue, which also includes the on-premise support portion that previously appeared in SaaS and support. License revenue was $28.5 million in fiscal Q1 of 2% year over year, where price increase and contract expansions were offset by migrations to the cloud. To help bridge the previous SaaS and support taxonomy, revenue totaled in FQ1, [$91.5 million], up 25% year over year, driven by sales to new clients and expansion of existing clients through cross-selling and up-selling initiatives. Professional services revenue totaled $13.4 million, down 8% year over year, reflecting our strategy to de-emphasize services revenue. This approach aligns with our focus on deferring more of these functions to our partners, allowing us to concentrate on overall client satisfaction. Total revenue was $118.8 million, up 17% year over year, driven primarily by sales of our cloud solutions. Our international business continues to present growth opportunities for expansion and greater platform utilization beyond the US. Revenue from our international operations remains strong, comprising approximately 34% of total revenue in fiscal Q1, up from 31% a year ago. At the present recent quarters, we continue to invest in and expand our alliances and partner ecosystem around Intapp. Since elevating our partner program a year ago, we have attracted new partners across our target markets, now totaling 135 data, technology, and service partners, a 20% year-over-year increase. With additional accreditation and enablement, these investments enhance our capabilities in deal generation, technology, data, and implementation. And we remain optimistic about their ongoing impact. Intapp's new vertical SaaS AI offerings, Assist and Walls, for Copilot contributed once again this quarter. While it is still early in our product rollout, pipeline development, and client provisioning, we are excited about the growth prospects ahead in fiscal 2025 and beyond. Q1 non-GAAP gross margin was 76.3% up from 71.8% in the prior year period. This margin improvement was driven by a services mix and cloud optimization efforts. Non-GAAP operating expenses totaled $75.6 million compared to $66.5 million in the prior year period, reflecting our continued investment in product-led growth. As we continue to focus on our operational efficiency, non-GAAP operating income was $15.1 million, as compared to $6.4 million in the prior year period. Non-GAAP diluted EPS was $0.21 in the first quarter of fiscal 2025, as compared to six cents in the prior year period. Free cash flow, which is defined as our cash flow from operations less capital expenditures, was $24.1 million for the first quarter, or 20% of total revenue. We exited the quarter with $253.8 million of cash and cash equivalents. Turning to our key metrics, cloud ARR was up 27% year over year, and total ARR was up 19% year over year. Total remaining performance obligations were $549.4 million, up 32% year over year. Overall, we remain committed to executing our land and expand model, ending the quarter with over 2,600 clients. Of these, 707 had an annual recurring revenue of at least $100,000, up from $626,000 in the previous year. Our cloud net revenue retention rate highlights our ability to retain and steadily grow business with existing cloud clients, reaching 119% in Q1 FY25. Now turning to our outlook for the second quarter of fiscal 2025, we expect fast revenue of between $79.5 million and $80.5 million. As these are newly provided revenue outlook metrics, we are also providing the implied year-to-year growth outlook of between 26% and 28%; total revenue in the range of $120.5 million and $121.5 million; non-GAAP operating income in the range of $14 million and $15 million; and non-GAAP ETS results of $0.15 to $0.17 using a diluted share count weighted for the quarter of approximately 83 million common shares outstanding. For the full year fiscal 2025, we expect fast revenue between $327.6 million and $331.6 million. As these are newly provided revenue outlook metrics, we also are providing the implied year-over-year growth outlook of between 26% and 28%. Total revenue in the range of $495.5 million and $499.5 million. We also expect non-GAAP operating income in a range of $61.5 million and $65.5 million. And non-GAAP EPS in the range of $0.73 to $0.77, using a diluted share count weighted for fiscal year '25 of approximately $84 million, common shares outstanding. Thank you. And I'll now turn the call back to the operator.\nQuestion and Answer Session\nOperator\n (Operator Instructions) Steve Enders, Citi.\nSteve Enders\n Okay, great. Thanks for taking the questions here. I guess maybe just to start, it'd be helpful to, I guess, get a update on maybe what you're seeing out there in the deal environment in? And if there's been any kind of change in some of the macro, or how you're thinking about financial services side in particular, given some of the softness that you saw there in the past year or so?\nJohn Hall\n Thanks, Steve. No, we have not seen a change in the deal environment. Demand has been strong. Our pipeline is quite strong. We do have the experience of lumpiness in the large deals, as we've talked about from time to time. But we've not seen anything related to macro, even in financial services, so that's been great.\nSteve Enders\n Oh, okay. I guess maybe just to ask a little bit differently. I think we're kind of getting the question from investors just on some of the ARR and billing dynamics here. And I guess it would be good to kind of give your view on maybe how you kind of view the year shaping up from a timing perspective. And if this is maybe in line with your expectations? Or just how you would kind of characterize how this year might take place versus what we might have seen in the past?\nJohn Hall\n Sure. So as we've discussed a little bit, Q4 was very strong. We had set up a new strategic team at the beginning of fiscal '24. We had done some investment over the previous years to really develop our enterprise grade features because we were getting interest from larger and larger accounts. And we had good success with that model in '24. So at the start of '25 here, we moved more of our sellers into that same model as strategics. We're calling it enterprise. And we've given more of the named accounts to both a new logo pursuit team and a existing account account management cross sell, up sell team to take advantage of all the new clients that we brought on board in that tier. So Q1 is definitely the time that we move the accounts to the sales team that had good success there. We also have the proof point from last year of how well that went. And there's, as we talked about Investor day, 70% of our sale is in our top 2,000 accounts. So we want to make sure that we put the right resource allocation to set ourselves up for the billion dollars and more. And that's going well, but we did see some pause in the closing of those large accounts. We did not see anything like that in the mid market accounts, which gives us good evidence about the macro. Also, the commentary has been quite strong and the pipeline is the strongest it's ever been.\nSteve Enders\n Okay, great. That's all the context. Thanks for taking the questions here.\nOperator\n Kevin McVeigh, UBS.\nKevin McVeigh\n (technical difficulty) to start framing the impact of the alliance that you have, particularly just continues to kind of be enhanced and you know, just so we get a sense of percentages more broadly kind of where it is today and what that can be over time?\nJohn Hall\n Kevin, this is John. I apologize. The beginning of your question was --?\nKevin McVeigh\n Sorry, sorry about that. Yeah, just more -- how should we think about kind of the alliances? And you know, does that kind of enhance over time or what percentage of revenue that is today? And how can that scale over time?\nJohn Hall\n The Microsoft partnership is the largest one, obviously. We've had a very good amount of progress throughout fiscal '24 and continued in the first quarter of fiscal '25 with increased co-marketing and co-selling activities. Obviously, our product announcements around Intap Assist and Walls for Copilot have gone very well. The Azure relationship where the firms can spend part of their minimum. Azure spend their Mac agreement with us because our entire portfolio is available now on the Azure marketplace and the Microsoft sales reps receive commission and quota relief when they sell intact products. So all the components are aligned for us to be co-selling. We also re-qualified for Microsoft's top tier status and global ISE status, which we're very excited about. And we've got good collaboration in the field. We even have some very important large account deal sharing, lead sharing, going back and forth. And we're co-selling in several important places. So I'm excited about the relationship with Microsoft. It takes a little while to get that going, but a lot of good progress. And then in addition to Microsoft, we have very strong partnership growth. I gave some stats in prepared remarks. But a lot of data partners coming on board, a lot of services partners helping to expand our reach in different parts of the market and internationally. The partnership program is really developing well.\nKevin McVeigh\n And then just to follow up on that, obviously you're seeing a lot of outside success on the margin in terms of literally that the margin upside, particularly relative to how you're guiding. Any thoughts as to what's driving that, number one? And then philosophically, does that continue to flow to the bottom line or do you use that as an opportunity to reinvest and capture more the GenAI opportunity?\nOperator\n One moment for our next question.\nJohn Hall\n I'm sorry, Kevin. Just to answer your question on margin, Dave, you want to take that one?\nDavid Morton\n Yes, I will. Kevin, great question. Thank you. We'll continue to work on our productivity and efficiency, not only on the gross margin, as we continue to scale. We still have some opportunity there. We've been working, and I want to thank, publicly, our services team, continue to bring that to not only neutral, but beyond that, as well as there's still scale opportunity within our cloud operations altogether. And then when you go below the line, clearly we're going to continue to invest in the company. We've continued to invest. So this hasn't been an absolute reduction, but where you have seen scale has been both in our sales and marketing productivity, as well as in our G&A. And so when you think about how we continue to invest and stay ahead of the front, specifically in our product led growth organization, that's where you'll continue to see more of an orientation within our product and engineering teams, which gets to your question of GenAI and other narratives on that. Very excited about our roadmap and what that will continue to entail, as well as where that leads us in the back half of this fiscal year.\nJohn Hall\n Thanks, Kevin.\nOperator\n Alexei Gogolev, JP Morgan.\nAlexei Gogolev\n Thank you. Hello, everyone. John, David, may I confirm the implied guidance for share of SaaS revenues in the back half of fiscal 2025? It seems like you're suggesting there might be slightly lower share of those revenues in the second half of the year versus 2Q, maybe some outlook or color, why that might be?\nDavid Morton\n Sorry, could you repeat the question? Were you looking at just the pure SaaS or SaaS and support or --?\nAlexei Gogolev\n Well, you're disclosing pure SaaS now and in 2Q you're guiding 67% or there about almost 67% and for full year closer to 66%. Just trying to understand if you're expecting some change in the revenue mix or this is just conservative assumption?\nDavid Morton\n No, we're being prudent on the overall metrics. I think what you'll see, as we uptick both SaaS as well as the total revenue in total, we do have some shift evolutions as we continue to balance license as we talked about, and putting more in the cloud, which is a time and effort and an evolution, as well as you get an associated pickup when that happens that we've talked about. So it's not a matter of if, it's just when. So that's one balancing impact. And then the other balancing impact is also how we've continued to articulate the services portion. And that we want to, not only focus more on our customer satisfaction, but then also continue to grow our partner economy. And so that's been a balancing act as we think about our respective guide, all of which continue to be very prudent in our eyes. And so we can continue to deliver the expected results.\nAlexei Gogolev\n Great, thank you, David. And can you remind us what your outlook is on met new customer additions versus upsell and cross-sell, the ratio that you anticipate going forward?\nDavid Morton\n Yeah, we don't guide specifically on that per se, but I can tell you historically, you've seen about 20%, anywhere from, I'll call it, 20% to 40% of net new logo as far as ACB dollars. And then they responded being the expand motion. So we've got the wonderful opportunity, not only to deliver a billion dollars and beyond just on our net new logos, but then also, as you know, as we continue to cross-sell and up-sell, we have a billion dollar opportunity in front of us just on that motion as well. But for this year and our time and place of how we're thinking about the back half of fiscal 2025, it's going to fall into those ranges.\nAlexei Gogolev\n Great. Thank you, David. Thank you.\nOperator\n Cody Kiechle, Bank of America.\nCody Kiechle\n Yeah. Hey, guys. Thanks so much for taking the question. I had a question on cloud ARR. It just drew 27 and a half percent. Really, really strong performance, all things considered. But I do look at it and it has been decelerating. And I listened to the commentary on the pipeline, which sounds really, really strong. But then I also listened to, you know, it sounds like there might be a little bit of deal elongation out there too. So I guess the question is, what is the potential for this cloud ARR growth metric to accelerate over the next several quarters from here and what would be the drivers for that?\nJohn Hall\n Thanks, Cody. So I'll give some points in the day if you can add anything you like. But the core of it is we sell all cloud now, as you know. We're steadily moving up the percentage of the overall business in the cloud, and we report that. So all the new additions add to the cloud growth. We also have more new logos that we acquire each quarter. And so the cross-sell and up-sell that we do to existing clients is all cloud. And so the fundamental growth of the business is in that cloud ARR number. There's also a movement to migrate the existing remaining components of our client base to the cloud. And we talk about that a little bit. I think as far as the deals go, as we move up to the larger firms, and you saw some very large numbers in Q4 when we reported the number of million-dollar ARR clients, those firms are, not only large opportunities when we land them, but they're large opportunities when we expand as well. So as we allocated resources to pursue the 2,000 named accounts at the top of the market more and more, which we made a move here in '25 to do more of, I think you're going to see an exciting opportunity for us to bring in larger deals. They do tend to be lumpier, as we've talked about from quarter to quarter. At the same time, when they come in, we can have some really exciting results. So those are the major components.\nCody Kiechle\n Got it. Thanks for that, John. And maybe just a quick follow up here. Last quarter, you gave a percentage of net new ACV coming from AI products at 4%. I know there's some qualitative, or yeah -- qualitative commentary in the prepared remarks. But I was wondering if we could get an updated number, was that this quarter versus last quarter? If you could, please? Thank you.\nDavid Morton\n Yeah. Hey, Cody, it's Dave. Yeah, we're just going to provide that more so on an annual basis. We know we kind of brought it out last quarter kind of as a rolling thunder just to give some insight and thought leadership in and around how we're monetizing that. That continues and will continue to provide periodic updates, but not one of a quarterly metric.\nOperator\n Alex Sklar, Raymond James.\nAlex Sklar\n Thank you. John or Dave, can you just elaborate a bit more on the changes in the sales team and go to market that you elaborate that you spoke to? How much of the team was impacted? When did you make those changes? And I'm curious, have you seen any market improvements in terms of productivity to that large account team in October that gave you some visibility to take up the full year guide above the Q1B? Thanks.\nDavid Morton\n Thanks, Alex. So we tested out the model in '24. At the very top of the market we saw some excellent results. We moved a significant portion of the team at the beginning of fiscal '25 when we gave new territories and comp plans for the year. I'm very appreciative of the team's excellent work. We have long standing team members who are very experienced in this industry and there was a lot of collaboration to help move accounts to folks in each area. We also followed through on what we discussed at Investor Day, which was to put the entire team into a new accounts, existing accounts model, because there's a significant number of new logos across the board for us to go continue to focus on and when we can get to a billion dollars or more just doing that. But we also have a billion dollars or more from cross-sell and upsell. So we wanted to make sure we had the right account management investme,t to drive the whole portfolio through the business. The number of million-dollar accounts that we showed in Q4 came both from new logo acquisition and cross-sell into those large accounts, and there's a huge opportunity for us to meet the needs of the underserved market this way. So I think the resource allocation choice that we moved on here was well proven. I think the opportunity going forward, as people now have had a chance to meet everybody and talk to their new accounts and get going with pipeline advancement, pipeline development, and advancing the deals that were handed over to them are in good shape. And so we're excited about the rest of the year.\nAlex Sklar\n Okay, thank you for that color. And then maybe we'll follow up for you, Dave, just in terms of the drivers and cloud NRR this quarter. And any changes between end market growth or expansion by solution-type? And then separately, can you disclose the total NRR number for this quarter? Thanks.\nDavid Morton\n Any key drivers? No. I mean, it's continued success. The teams that continue to garner the expands, right? They do a wonderful job doing cross-sell and up-sell, and continue to monetize those opportunities, which even going back to our analyst stand February 22, you've seen the cohorts of each of those respective years and how big they can be. So that's just the continuation of that. I can provide our total NRR and we'll continue to disclose that in our 10-Q. It was approximately 114% within the respective range of 113% to 117%. But I really want to transition everyone over to primary cloud metrics because those are going to be the ones that we're focused on. And obviously, that we're garnering more and more attention to as well as support and investment thereof, specifically on the expand motion. Because when you go from on-prem to off-prem, it's going to change some of those cohorts as well, right? And so just don't want to get into a reconciliation of how that attribution is going forward. Anyway, there you go.\nAlex Sklar\n All right, great. Thank you both for the color.\nOperator\n Saket Kalia, Barclays.\nSaket Kalia\n Okay, great. Hey, guys. Thanks for taking my questions here. John, maybe for you. A lot of great examples in the prepared remarks around new and existing customers and around GenAI. Maybe a bit of a broader question. Can you just speak to sort of where you think we are in the journey of converting those on-prem customers to SaaS? I mean, there are a lot of things that you can do to entice them to move over. Where are we sort of in that journey? And what do you think is going to change here in fiscal '25 around that? Does that make sense?\nJohn Hall\n Thank you, Saket. We talked at Investor Day about the fact that we historically had been at the client's option, but starting in fiscal '25, we were looking to be a little bit more encouraging to move firms along. And we're definitely doing that. We're doing that in a few ways. The first, fundamentally, is you can only get the Generative AI capabilities, and in fact, even more the AI capabilities more broadly in the cloud. And there's a lot of pressure coming from the professionals across these firms to create a more modern experience for them and for the way that they work inside their organizations that they want to take advantage of all these new capabilities. So there's a natural pull that was always there, but I think AI obviously gives a lot of excitement to people to pull that in. Secondly, there's a real demand from the firms to move into the cloud because of scalability and reliability and security firms have just come to the correct conclusion that they don't have the IT spend scale to create the right kind of security and scalability environment that they could get working with us and partnering with Microsoft or on Azure that the firms basically just need. And so there's a lot of pressure to the firms to get off their on-prem remaining environments themselves and we're benefiting from that. And then, you know, I think to your point about what we're doing specifically, we absolutely have a program now in fiscal '25 that we have launched to go through each of the remaining firms that have some on-prem component and help them in a variety of ways to get over the hurdle and move to the cloud platform. Because as Dave showed at Investor Day in some of his client account expansion slides, boy, is it worth it to get those firms onto the cloud because their expansion rate really picks up. So we're making judicious prudent choices in each area to help every firm through a variety of techniques make the case to get there. And I'm excited about how positively we're received. There is not a remaining firm out there that's making an argument that they should be on the cloud -- I'm sorry, be on-prem. They all know they need to get to the cloud. It's just a practical question how do they line up their IT schedule to do that.\nSaket Kalia\n Got it, got it. That makes a lot of sense. Dave, maybe for you, maybe to the earlier point just around new ARR being lumpy, you know, it's -- total net new error was down year over year this quarter, of course. But maybe the question is, as you sort of look at the strength that INTAP had in Q4, is there anything that, just looking at the postmortem, we need to keep in mind when thinking about timing in terms of how deals sort of fall in one quarter versus the other?\nDavid Morton\n Not necessarily from a pull forward or push out or anything like that or even a nominal seasonality. I do think as we think about really coming into this new fiscal year, and as John alluded to and getting the teams aligned and organized and a sales kickoff and seeing all the success from previous years, where's the opportunity of kind of how we articulated how we're going to get to a billion dollars and the named accounts and mid market and so on and so on, I think for us, as we think about the opportunity coming into this quarter and others, we've been spending a lot more time on kind of our own-type gen, type analytics, pre-shopping, shopping, where those cohorts land. And to John's earlier point, we haven't seen as strong as type, maybe in the history of our time. And so, you know, we're excited about those opportunities and it's for us to go and monetize and convert those over. And so we like how Q2 started to play out, as well as not only here, but also into the back half of the fiscal year.\nSaket Kalia\n Very helpful. Thanks, guys. Thank you.\nOperator\n Parker Lane, Stifel.\nParker Lane\n Hey, guys. Thanks for taking the question. You talked a lot about the development and go-to-market around some of the Generative AI opportunity. But I was wondering if you could touch on any particular learnings you've had in discussions with your customers around the pricing and packaging of those solutions. Has there been any sort of changes or excitement around the way you guys are pricing? What are your early impressions of how it's being received?\nJohn Hall\n Thanks, Parker. You know, I think we, as everybody has, have benefited from the whole GenAI buzz over the past year or two on one hand. So the world has done its work to educate the market, even down to the professional users, that there's the potential for something like this out there. I think we're moving into a phase of the GenAI generation, where the general promise is hitting the real world. And our strategy, which we have argued from the beginning, is that these generational shifts in the technology, they happen in specific applications. It's the old killer app idea. What is it that's going to pull in these generations of capabilities with very specific applications that really understand the end user. And I think the vertically oriented companies, obviously, we with this particular end market that's very susceptible to the potential. The whole trick is how do you build very specific applications early on that the user can get an immediate benefit (technical difficulty) coverage and sourcing and origination of new opportunities, cross-selling and looking for opportunities inside the firm's client base. And I was very excited about this in-tap assist for terms launch, which brings the whole concept into our compliance value proposition to help people just talk conversationally through Teams to Intapp Assist. And it answers questions about their promises to clients across the firm, or some promise that some other professional that's one of their partners made somewhere else in the world that they need to know about when working with the client. So those specific applications are really winning with the individual users and with the firm's leadership. And from a pricing and packaging standpoint, we've seen good success in being able to defend pricing, even in this era when some of the more generic GenAI systems are getting a little bit of pressure. We've got great value because we've been able to isolate down to some of these specific value propositions. Obviously, over time, Intapp Assist will grow and we'll have more and more of those. We'll be a richer and richer platform, but I think the real trick from a marketing and go-to-market standpoint is really to nail those use cases and the team's done a fantastic job. I'm very grateful to the work that they've done and to the clients for taking it up.\nParker Lane\n That's great feedback. Thanks, John. I'll get back in.\nOperator\n Terry Tillman, Truist Securities.\nTerry Tillman\n Yeah, thanks for taking my question. I'm not going to ask about ARR. I'm going to focus on KPMG. I think last quarter you all had a pretty important win, I think, in terms of across their global network of businesses. So maybe after that deal being signed, what can you say about your collaboration product in general? Has that been a linchpin to win more business? And then secondly, I think that deal was concluded with an Azure Marketplace situation. And so like, what is that doing in terms of reducing friction and getting deals done in terms of the leveraging credits, et cetera? Thank you.\nJohn Hall\n Thanks, Terry. So you're right, we were very excited about that announcement. It gives us an opportunity to go across the KPMG network in that case, and they're analogous opportunities for us across the whole market. Historically, this end market, these professional and financial services firms have been underserved by a vertical player like us, and we're bringing a purpose-built platform in the cloud. We have Generative AI that they just haven't had access to before. So we're excited about that. With regard to collaboration specifically, this is the product that is most closely enabled through the Microsoft partnership, because we help firms take advantage of Microsoft Teams and SharePoint and Microsoft 365, Office 365, in a way that works in the professional firms, where it really understands the deals and matters and engagements and projects that the firms are working on. And it also understands the compliance requirements that those teams have as they work together. So we think it's a great fit. KPMG is one example, but we have quite a few new firms that have come on, taking up our collaboration solution in a way that gives us a lot of confidence about the future there. And KPMG is an interesting example in accounting. We've had a lot of uptake in the accounting market, I think because they have been so underserved historically. We're seeing more uptake in the other markets, but accounting has really gotten excited about it. So we're super happy about that. I think with regards to the Azure marketplace question, it has a couple of benefits for reducing friction. One is the firms have already signed a contract with Microsoft that they're going to spend X dollars this year on Microsoft stuff. And so once they've done that, if you can go in and show them capabilities like collaboration that fit their needs for their IT priorities. And they've already promised to spend the money, why not spend it with you? And I think that's the simplest argument for the Azure Marketplace, is those Mac agreements. But I also think that firms are trying to simplify their vendor relationships. They want to work with people that are at scale that can supply across the portfolio and so the Intapp-Microsoft partnership really helps them simplify their environment. And the fact that we're helping them get the most value out of the existing Microsoft spend on Office 365 and Teams really helps them as well. So the field loves it when we engage now. This is one of the first questions that the team asks the prospect is, do you have a relationship here? Do you have a Mac agreement? Can we work with you on the Azure marketplace? And the response is generally very positive because people are getting used to buying it that way.\nTerry Tillman\n Thanks for the color. Appreciate that.\nOperator\n Arvind Ramnani, Piper Sandler.\nArvind Ramnani\n Hi, thanks for taking my question. Yeah, I wanted to ask about your kind of partnership with Microsoft, which obviously has been, kind of a really important part of the equation in terms of your AI strategy. So question one is, are you kind of keeping your options flexible. I mean, clearly Microsoft is still leading the way. But you're keeping your options open as this AI technology continues to evolve and change and there may be like a new kind of leader in the space. And the second thing is, from a cost perspective, is there any risk that Microsoft's going to take it's sort of like leadership position to kind of increase the cost it's pushing with its partners?\nJohn Hall\n Thanks, Arvind. On the first point, as we've talked about on other calls at Investor Day, we do have more than one AI technology capability in the company. As we shared with you all, we have been developing AI-based technology for this end market with specialized vertical purpose-built applications for 10 or 15 years. We had some of the first technology in the market 10 or 12 years ago with our time product that helps the lawyers at the time figure out what they should bill for. And over the years, we have grown our AI team. And Generative AI is the most recent example and now it's kind of news everywhere. But we've been in that line of technology for quite a while, because there's such an opportunity in this market in particular to use AI techniques and AI technologies to help firms make sense of structured and unstructured information in a more productive way. So we're big believers in it. And yes, we do have other technologies working inside the platform. So we're not exclusive with Microsoft on AI technology. That being said, this end market is also a very Microsoft oriented market. The professional firms, the financial firms, particularly in their IT departments, but more generally spend all their time in the Microsoft environment. So the partnership is very important. It's also very strategic for us to make sure we can say yes to these firms and be aligned with their IT strategy. And I think that this actually gives us a real advantage versus technology companies that don't have the same alignment with Microsoft's plan. I think your question about cost is kind of the flip side of that. There are all kinds of things progressing in the open source world and elsewhere around AI technologies. And Microsoft certainly has a tremendous position, but there's also all kinds of options out there. So I think we're going to benefit from that as well the whole world and industry on this idea of how do you get the most effective AI at the right cost structure to enable you to bring solutions to market that firms can really take up. And we're going to see how it plays out, but I think Intapp is very well positioned around AI to take the best advantage as we go forward.\nArvind Ramnani\n That's terrific. Thank you so much.\nOperator\n Brian Schwartz, Oppenheimer.\nBrian Schwartz\n Yeah, hi, thanks for taking my questions this afternoon. John, I was hoping to just follow up on your commentary that the large deal activity was -- maybe it was less robust than what the business had seen the last couple quarters. I'm just curious cause the pipeline commentary is very strong. Do you think that that's just seasonality? Or is it a macro or maybe election related? Curious to get what your take is on that.\nJohn Hall\n Thanks, Brian. I think because we've seen such consistent performance in our mid-market business, the main factor is the realignment that we did at the beginning of fiscal '25 to put more resources against the 2000 enterprise accounts. I think that's the main driver. Whether the election has something to do with the market generally, we probably would have seen in the mid-market. If it did, who knows to that question? But I think generally speaking, we started the year and did the appropriate assignment of resources to the large accounts with a good proof point from last year about what that could do for us. And I think the opportunity scale is significant. And so we want to build the company to a billion dollars. And I want to make sure we've got the team set up to do it. And we've got sales professionals who have been through this before. And all they got to do is go meet the firms and get their pipeline advanced. And that's what we saw in the first quarter. So I'm comfortable that we've put the right resources against a very large opportunity here and we're set up to go.\nBrian Schwartz\n Thank you for that call, John. Appreciate that. David, maybe just one with you. In terms of maybe the assumptions that's underlining your growth guidance, I'm just curious how you're thinking about the capital markets activity? Are you expecting any change in maybe the end market demand for that segment from maybe what you were thinking three months ago, given how interest rates have changed since you last gave guidance? Thanks.\nDavid Morton\n No. Thanks, Brian. For us, our end markets have been relatively healthy that we've commented on. We have one aberration that we commented approximately a year ago when we saw some headwinds, specifically with one specific group within overall financial services. But if you think about in broad based, everything's been really healthy, quite candidly. And so, this has been about us and able to execute and drive everything from pipe to conversion. We're just avid believers in our product, our platform. We believe we're one of nobody who's got the very specific purpose-built platforms for what they're looking for. And so it's for us to go execute outside of whether it be election cycle, outside of some of the capital market, interest rates, other things going on.\nBrian Schwartz\n Thank you for taking my questions.\nOperator\n Thank you. There are no further questions at this time. I'd like to turn it back to John Hall for closing remarks.\nJohn Hall\n Okay. Thanks, everyone. We appreciate your attention and questions. We have a great Q1 behind us and we're excited about our continued momentum throughout fiscal '25. Thanks again for your time today. We look forward to talking to you all next quarter.\nOperator\n This concludes today's conference call. Thank you for participating and you may now disconnect.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.30.2","shortVersion":"4.30.2","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2481463921"}