Ladies and gentlemen, thank you for standing by. And welcome to Sprinklr’s Fourth Quarter and Full Year Fiscal 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ remarks, there will be a question-and-answer session. Please limit your questions to one so we will have time to go through all the questions. Please be advise that today’s conference is being recorded. I would now like to hand the conference over to your first speaker today, Mr. Eric Scro, Senior Vice President of Finance for inductor remarks. Please go ahead, Eric.

Thank you, Diego. And welcome everyone to Sprinklr’s fourth quarter and full year 2022 results financial call. Joining us today are Ragy Thomas, Sprinklr’s Founder and CEO; and Manish Sarin, Chief Financial Officer. We issued our earnings release a short time ago, filing the associated 8-K with the SEC and we have made that available on the Investor Relations section of our website, along with the supplementary investor presentation. With the call, let me please turn it over to Ragy.

Thanks, Eric, and hello, everyone. It is wonderful to speak with you all again. Before I get into the numbers, I want to start by welcoming Manish, our new CFO to Sprinklr. I couldn’t be more excited to have him and frankly his track record of scaling high growth tech companies as we continue to position Sprinklr for the next chapter of scale, growth, and efficiency. I know he’s looking forward to getting to know all of you. Manish will take you through detailed financial results in a few minutes, but I wanted to start with some of the highlights. First and foremost, I am pleased to report another strong quarter that exceeded guidance on all metrics. That includes Q4 total revenue, which grew 30% year-over-year to $135.7 million; and subscription revenue, which climbed to $117.7 million, which is an increase of 31% year-over-year. Coming off significant reacceleration that we drove over the past four quarters, this is now our second straight quarter delivering more than 30% in revenue growth. With the strength of that execution, we finished FY 2022 with $492.4 million in total revenue, which is an increase of 27% year-over-year and that was primarily driven by $427.7 million in subscription revenue, which is up 26% year-over-year. Not only have we reaccelerating growth, we are also doing it at scale with nearly $0.5 billion in revenue for the year, a combination that we believe reflects the durable multiyear growth opportunity that we see for Sprinklr and our ability to win in a massive customer experience management category that we believe is only getting started. As you know, we have four products suites for major customer facing functions including customer care, research, sales, and marketing, each of which have reached significant revenue scale for us and are leading solutions…

Thank you, Ragy, and good afternoon, everyone. It is great to be here today and I am excited to be at Sprinklr. I am looking forward to working with all of you over the coming days and weeks. As you heard from Ragy, we delivered another strong quarter across the Board and we are pleased with our ability to once again exceed expectations across all key financial metrics. During the fourth quarter, total revenue was $135.7 million, up 30% year-over-year and above our previously announced guidance range of $129 million to $131 million. This was driven by subscription revenues of $117.7 million, which grew 31% year-over-year and were also above our previously announced guidance range of $113 million to $115 million. Q4 marked the fourth consecutive quarter of accelerating revenue growth for our subscription business. Turning to gross margins for the fourth quarter, on a non-GAAP basis, our subscription gross margins improved further to 80%, as we begin to drive efficiencies in our cloud operations, leading to a total non-GAAP gross margin of 71%. Before we review operating expenses, I would like to make you aware that during the fourth quarter of FY 2022, subsequent to the guidance we provided on December 9th, we identified certain immaterial corrections. These relate to the capitalization of cost to obtain customer contract dating back to the initial adoption of ASC 606 in FY 2020. The net impact of these changes is to capitalize additional expenses each year and amortize these costs over the life of the customer. Additional details are outlined in our Form 10-K that will be filed in the coming days. It is important to note that this immaterial correction to prior periods has no impact to our previously reported revenues, revenue growth rates, gross margins, cash flow or cash position.…

Thank you. [Operator Instructions] Our first question comes from Mark Murphy with JP Morgan. Please go ahead.

Yes. Thank you very much and congratulations on a very strong finish to the fiscal year. Ragy, I am wondering what you are sensing in terms of business confidence from marketers and social media teams, especially in Europe, because the results in the guidance is quite strong, you are calling for a solid year of growth. Are the geopolitical events and the macroeconomic factors starting to cross their minds at all as they think about their budgets or do you sense relatively smooth pipeline building in Europe and kind of good business confidence overall for this category?

Thank you, Mark. Good to talk to you again. We are actually sensing renewed confidence in the offering that we bring to the table. I just got back from a week in Europe where we met with over 75 customers. And what was interesting was almost all of them that use -- that were using our customer feedback and insights product, right? Our Modern Research product had configured dashboards to understand the impact of the -- what’s going on in Ukraine and Russia to their business. Let me give you two specific stories. One customer I met with just told us that the previous week they discovered online conversations about their logo looking like the Russian Army symbol, and it was picked up by Sprinklr’s volumetric triggers, reflecting negative sentiment picking up; and in 72 hours, they saw that conversations go from tens to hundreds to thousands and tens of thousands. And because they were watching it grow, in the same 72 hours, they were able to make a business decision and remove their logo and replace it with text in all digital properties and then subsequently saw those conversations decline. I thought that was fascinating. We know -- another customer I visited basically was explaining how they discovered their logo look like the Ukrainian flag colors, and that was frankly attracting a different set of conversations, and they made the decision of engaging and responding and putting out their point of view on it all based on strategic insights that we were delivering from the voice of the world. And another bank that I know of basically was planning to, the CEO was going to make a decision and take a stance on it and discovered that using Sprinklr, the other competitors of his did make their stances public and would negatively affect it. So, we are super encouraged by businesses making decisions. I mean, obviously, because the Sprinklr, but making decisions that are based on the voice of the world and voice of the customer. So that’s just the start, businesses are moving digital, direct-to-consumer is a huge deal, and we serve everything from conversational commerce to digital customer care. I think the world is moving in our direction.

Well, those are wonderful anecdotes. Thank you for sharing that and I will limit it to one question to comply with your instructions here. Thank you.

Thank you, Mark.

Thank you. Our next question comes from Raimo Lenschow with Barclays. Please state your question.

Hey. This is Frank on for Raimo. Congrats to a strong end to the year here. Could you remind us of the rollout cadence or any early feedback you are getting around the late offerings and how is this baked into the guidance specifically for FY 2023? Thank you.

Thank you, Frank. We are not factoring major revenue from the Lite offering in our models. As I mentioned before, in previous quarters, the ability for us to make our platform in a self-service very low touch, zero day -- one day on being -- getting up and running, it’s a strategic multiyear plan for us. So, we are very early. The results are very encouraging. We are watching clients get on board by themselves setup with -- I saw a client that had set up over 100 automation rules by themselves and are up and running. So, we know we are moving in the right direction. We know we are simplifying what is a fairly massive piece of technology in the front office but they are all experiments for us for now, and the numbers aren’t factored in.

Great. Thank you.

Thank you, Frank.

The next question comes from Elizabeth Porter with Morgan Stanley. Please go ahead.

Great. Thank you so much and congrats on the strong quarter. I had a question on the NRR improvement, understanding it’s a 12-month metric, so there are some COVID quarters probably falling off still. How should we think about the cadence of expansion, do we start to normalize at this 120 or can cross-sell opportunity really accelerate further as customers expand into more suites?

Absolutely. Great question. We have four product suites with a lot of functionality underneath it. If you look at our average revenue per customer, per product suite, that’s -- it’s going to -- you are going to see that range from just below 100 to 150. If you look at what the largest customer in each one of those suites have paid, you will see a very, very different number. You will see that our largest customer in marketing and advertising pays us close to north of $6 million, our largest customer in care pays us close to $4 million, our largest customer in research pays us close to $8 million, and our largest customer engagement pays us over $5 million. So, it’s super obvious to us that we have got a substantial TAM just within our customer base, and our first set of vector one clients as we call it are 10,000 of those. So, we know that TAM is big. We know that customers are expanding. It’s our ability to deliver. We have taken the approach of land and expand in a very soft way, so we love to land with one product through our values and expand into other business units, expand into other markets. In short what I am seeing is, we anticipate continuing to stabilize and grow on our expansion rate, and we think there’s a lot of opportunity right there.

Great. Thank you so much.

Our next question comes from Michael Turits with KeyBanc. Please state your question.

Great. Thank you, very much and wonderful quarter. Ragy, can you drill down, you did some -- did for somewhat on the prepared remarks, but a little bit more on CCaaS. Can you talk about whether you are I don’t know if you mentioned actually replacing other dedicated call center in CCaaS vendors and what some of the revenue uplift is coming from that and conversely, Manish, if there is any headwind to gross profit -- gross margin profitability?

Absolutely, Michael. We are -- this is an exciting opportunity [Technical Difficulty] from our focus in the last several quarters that we see CCaaS the market adding it 15% year-over-year in aggregate is a great growing opportunity. What we are finding is a new set of clients that are coming to us are in fact replacing traditional care vendors and it might be, point solution care vendors, like a live cat care vendor. I am not going to name them or a regional voice vendor and but what we are finding in the case of Lenskart, there was a point solution that the inbound voice care team was using. It was a separate voice solution that the outbound sales team was using, and not to mention, the other point solutions that digital teams were using and all of those are getting replaced with the Sprinklr platform. Actually, what was exciting for me was with Lenskart, they insisted on implementing Sprinklr voice first before they rolled out their digital and social capabilities, which we are very -- which is our original bread and butter. So, we think it’s very early. We have a couple of deployments that are fairly at scale, the 15,000-agent deployment and so we are going in with a lot of caution. As you know, this is an industry that’s very old, right? It around for 40 years, 50 years and there’s a lot of nuances. From a margin perspective, you know that we are not getting into the deep stack, right, where we are not, we are not doing the core voice part. We connect to services like Amazon Connect or Twilio or others and our value creation happens on the application layer, where it should be very obvious to all of you that there is not…

Thank you.

Thank you. Our next question comes from Arjun Bhatia with William Blair. Please state your question.

Perfect. Thank you and congrats on a strong close to the year. Ragy in your in your prepared remarks, I think, you went through where customers are landing most frequently and where they expand into after that. Can you just give us a sense for how the landing point of the platform has changed for customers over the years, if you developed new capabilities and innovated across your suite and then how frequently are customers now landing with multiple suites, where they say, hey, I want to take advantage of the entire Sprinklr platform or at least multiple, a couple of different product suite with to unify my CXM strategy across multiple domains?

Hey, Arjun. Good to talk to you again. We are actually increasingly seeing our landing spots open up and it is a lot more across the Board than it ever was and you remember, you and I have talked over the years and it used to be our sales and engagement or research and now we are seeing customers start with us for care and customers start with us from marketing and advertising. And I think what we are increasingly seeing is an acceptance that they all need to come together. So that’s the first trend and honestly our product is pretty and platform is very simple to understand, right, everybody’s selling, everybody’s marketing, everybody is doing customer care, everyone’s trying to understand what customers want and get feedback in real-time, right, without doing surveys. We just provided in a unified way and that’s the key difference. So, we are seeing that the deflection from pointed landing spots to diffuse across our platform and product suite. Interestingly, what we are also seeing is the emergence of a new crop of next generation companies like the Vrooms and the Lenskart or the RobinHoods or the Ubers of the world, who are fearlessly coming in and saying, hey, listen, I think, I don’t want to -- I want to just clean up. Lenskart is a great example, where they said, I don’t want inbound and outbound colliding with each other. Think about their business where, people buy their glasses like every, twice every four years or three times. And they are calling in to get an order filled or they have a question and you have got outbound people trying to reach this in-person and get them to buy again. And they were all getting in each other’s way and think about the market they serve, someone trying to reach you on WhatsApp and then you want to get them on the phone to ask a question quickly or ask them to try out something. It was just getting in all over the place and you got a Co-Founder of the company going, I just want to -- this is where my business is going to go direct-to-consumer next generation. I just can’t afford to bring the Franken stack of the past and so we are seeing that breed of companies to seamlessly start with two, three, sometimes all four of us with.

Very helpful. Thank you, Ragy.

Thank you.

Our next question comes from Tyler Radke with Citi. Please go ahead.

Yes. Thanks for taking the question. Maybe I will turn to throw question over to Manish, if you are still on the line there and congrats on the first earnings call here and a good quarter. Just a couple of housekeeping questions, so first, could you talk about the current RPO growth in the quarter? Apologies, if I may have missed that. And then, secondly, maybe just help us understand, as you took a look at the business and set guidance for the year, what are areas that may have changed from a guidance philosophy perspective relative to your predecessor and how are you just kind of thinking about the inputs and level of conservatism in your guide? Thanks.

Thank you for the question and thank you for asking me a question, I was getting bored over here. So really appreciated. So, I think the first question, RPO growth was 36%, so that is part of the prepared remarks. I think that number was $589.4 million. CRPO growth the current portion was 30% and I believe that number is $409.2 million. In terms of guidance philosophy, I don’t think much is different, except as I was saying in my prepared remarks, several things have happened during the course of FY 2022. Firstly, we have invested significantly both in our go-to market initiatives, product development and all of that is beginning to bear fruit. The business is now a scaled business, I mean, at the midpoint of the range that I provided for the full year. We are $611 million, so definitely hitting a scale perspective and try and achieving growth and that perspective. The other thing we are obviously very well aware is, given the investments we have made in FY 2022, we are going to be more efficient as we go through the arc of this particular year. So, we are looking for operating losses to improve materially during the second half. And I also said, as you then stress that out another year, we are looking to be free cash flow neutral in FY 2024. So, I think maybe that probably is a little bit material input as you build out your models, because we do believe the investments we have made are beginning to bear fruit and we can look to be more efficient as we keep up this pace of growth.

Thank you.

Thank you. Our next question comes from Parker Lane with Stifel. Please go ahead.

Yeah. Hi, guys. Thanks for taking the question. Ragy, wondering if you could comment on whether or not you have seen a change in the persona the person bringing Sprinklr in with the launch of Lite. Are you seeing more and more like line of business users that wouldn’t historically have found Sprinklr as accessible pushing for their companies to adopt the solution? Thank you.

Thank you for the question, Parker. We are seeing -- again we have got hundreds of people trying out their Lite products and they are usually practitioners who is a segment of our prospects that we typically don’t land was start with, right? We typically go to decision makers or the C-suite. What we are finding in the cases where they convert though, there is so much excitement that they are internally bringing senior people in. I will give you the example, at MTEL, where and also know that our Lite products. It’s early, right? So, we, as you know, we coincide with our customers, which has been a major differentiator for us. We talk to them all the time, ask them what they need and turn around in a very agile fashion, roll it out almost like consumer software companies do. And so, in the case of MTEL, they were excited about what the product could do. They were excited about how agile and innovative we were and the next thing we know we are talking to the CIO, who then proceeds to say, look, I want to bring sister companies in. But these are smaller teams, 10, 15 folks that traditionally like our sales folks would not have pursued and tried to close. So, it’s very early to draw any conclusions, but we are seeing access to practitioners grow. We are also seeing, which is very refreshing for me as I talk to customers, we are seeing customers move from one company to the other and just the first thing they do is bring Sprinklr in. So that that’s something that’s creating some groundswell for us as well as we have self-service. So, it’s not like they have got to go convince management, they can go try it out and show someone how good Sprinklr is with their new company.

Thank you.

Thank you. Our next question comes from Michael Turrin with Wells Fargo. Please go ahead.

Hi. This is Michael Rawson for Michael Turrin. Congrats on a great quarter guys and welcome to the team Manish. Just a quick one from me, I noticed that you added $2 million plus customers in the quarter, which is the lowest net new addition this year and even going back to last year. Is there anything that points you on Zaltec [ph], every other metric looks pretty strong and going to CRPO accelerate or an RPO acceleration, even GMBR are improving, anything to point to on not -- the large customer front?

Michael, it’s Ragy. Let me speak for Manish. He is new, I am sure he will add to this. Look those are metrics while we disclosed. Those are metrics that the company is not like super aligned and obsessed about. And you will see that Manish is bringing a very different focus and discipline to billings like we have never had before. So, you will see us get more control over what that number should be. I could tell you there is no change in the quarter in terms of customers growing with us. Now they fall $1.1 million where we get them added also remember its revenue, it’s trailing, and so directionally there’s no change in the business, I can tell you that and while the number is too we are seeing the trend that we always see.

Yeah. And just to add to that, I think -- this is what I reiterated in my prepared remarks as well. I think the metric the way we have defined it is actually a fairly high bar, because most of the subscription companies talk about customers doing $1 million in ARR, so you could sign them on the last day of the quarter as long as they are big customer they would make the grade. So, the way we have defined it as $1 million in subscription revenue for the year. So that is a much higher bar to clear. And again, I have just been here two months, so we are going to do a deep dive on a number of other metrics and as the arc of the year progresses, we will try to provide more clarity around some of these metrics. But I just wanted to make point this out that this is a fairly high bar that we have set for ourselves.

Understood. Thank you very much. Congrats again.

Thank you.

Thank you. And there are no further questions at this time. I will turn the call back to Ragy Thomas for closing remarks. Thank you.

I want to thank you all for participating and taking the time. We, as you can see, are pretty excited about the quarter, very proud of the team that that came through for us. You heard from Manish how in the last year we were pretty focused on making the investments, especially coming after COVID is, we were cash flow positive the year before that. So what you are seeing is the business that went from being conservative during COVID to correcting that in the last year. I am thrilled about the expectations that we are setting internally and externally of being more efficient as we continue to grow at scale. I have always said that, the price and growth of this industry is inevitable and it’s validated every time we speak to customers who talk to a large global brand, household brand, CPG company that has 60 customer facing brands that operate in 40 to 120 countries each running marketing and care and research and sales in every one of those markets and each one of those teams using different point solution for different channels. this is just ridiculous. And where the customer meets the brand at the very edge, when they see an ad or call a call center or speak to a sales guy, as I can attest with a much smaller company, it’s painful. So we know that this is going to get resolved. We know that we have invested 12 years into creating an architecture and a full product suite on a unified platform and we think we have another, let’s say, year or two of code to right, before the full picture emerges and so we are very encouraged by where we are and we think the best is yet to come.

Thank you,

Thank you all.

Thanks.

Have a good evening

And with that, that concludes today’s conference. You may disconnect at this time. Have a good evening.