[Call Started Abruptly] With me on the call today are Barak Eilam, Chief Executive Officer; Sarit Sagiv, Chief Financial Officer; and Eran Liron, Executive Vice President of Marketing and Corporate Development. Before we start, I would like to point out that some of the statements made on this call will constitute forward-looking statements in accordance with the Safe Harbor provisions of the Private Securities Litigation Act of 1995. Please be advised the company’s actual results could differ materially from these forward-looking statements. Additional information regarding the factors that could cause actual results or performance of the company to differ materially is contained in the section entitled Risk Factors in Item 3 of the company’s 2014 annual report on Form 20-F as filed with the Securities and Exchange Commission on April 2, 2015. During today’s call we will present a more detailed discussion of third quarter 2015 results and the company’s guidance for the fourth quarter and full year 2015. Following our comments, there will be an opportunity for questions. Let me remind you that, unless otherwise noted on this call, we will be commenting on our adjusted results of operations, which differ in certain respects from Generally Accepted Accounting Principles as reflected mainly in accounting for acquisition-related revenues and expenses, amortization of intangible assets and accounting for stock-based compensation. The differences between the non-GAAP adjusted results and the equivalent GAAP figures are detailed in today’s press release. And I’ll now turn over the call to Barak.

Thank you, Marty, and welcome, everyone. I am glad to be on the call with you today and welcome to the new NICE. One and half years ago, I shared with you that we put in place a strategic plan that will transform NICE over the next five years. We call this our 2020 Plan. This plan has several different phases and so far we have executed well in implementing it. We have realigned in terms officers from R&D to sales put into place a more effective go-to-market strategy, strengthened innovation, brought products faster to the markets and streamlined our overall operations, all have led to much improved growth and profitability. Moving further along in the process, we recently completed one of the key components of that Plan. We closed on the sale of our Physical Security division, which followed the closing of our sales -- closing of the sales of our Intelligence division a couple of months earlier. With these two divestitures, we are no longer in the Defense business. Rather we are now a more simplified true enterprise software company focused on analytics. At the new NICE, our business is aligned across all dimensions including technology, customers and markets. We are centered around more profitable product revenues rather than project-related lower margin revenues and follow a business model of an enterprise software company. As we continue to move forward with our strategic plan, we will make sure that our current and future business remained highly profitable and synergetic, and that we continue to deliver solutions to markets with great opportunities for long-term growth. In addition, the changes made at the new NICE enable the company’s management team to spend more time and attention on our Enterprise Software business. In that light, we are pleased to report another strong…

Thank you, Barak, and good day, everyone. I am pleased to provide you with an analysis of our financial results and business performance for the third quarter of 2015, as well as our outlook for the fourth quarter and full year of 2015. Before I begin I would like to make a few points about the recent divestitures of our Intelligence and Physical Security businesses that closed in Q3. For Q3 and the comparative numbers for 2014, we are reporting results of continued operations that excluded the recently divested Intelligence and Physical Security businesses. These two businesses are presented as discontinued operations. However, the cash flow statement includes the results of both divestitures. Revenue for the third quarter were $221 million, which increased 7% organically from $207 million in the same period of last year. Excluding the impact of foreign currency exchange rate, organic revenue growth was 10% in the third quarter. Customer interactions revenue were $164 million, similar to Q3 2014 and financial crime and compliance revenues increased 35% to $57 million. Moving to the regional breakdown, revenues in the Americas region were $145 million, representing 4% growth. Revenues in EMEA increased 10% to $50 million and revenues for the Asia-Pacific region grew 15% to $26 million. Looking at revenues by business line, product revenue grew 13% and accounted for 31% of total revenue. Maintenance revenue accounted for 43% of total revenues in the quarter and professional services, including cloud, accounted for the remaining 26% of total revenues in the third quarter. Gross margin in Q3 was 69.8% compared to 67.2% in Q2 last year. The gross margin improvement was mainly attributed to the increasing product revenues and product mix. Operating profit in the third quarter increased 45% to $56 million and operating margin improved to 25.2% compared to…

[Operator Instructions] Your first question comes from the line of Shaul Eyal with Oppenheimer. Please proceed.

Shaul? Operator, I think he is on the line.

Hey guys, can you hear me now?

Yeah, we hear you well. Hi Shaul.

Hi. Good afternoon. Congrats on a very healthy quarter. A couple of quick questions on my end. Barak, you spoke about healthy demand and book to bill being healthy. I don’t know if you can share with us if book to bill is above 1 or around 1 -- what’s the status on that front? And on the anti-money laundering for the financial crime, very, very strong showing this quarter. Help us understand what’s happening from a driver perspective on that product line.

Sure. No problem. Thanks for the questions, Shaul. So the first one, we don’t track or disclose our book to bill but as I said the pipeline is healthy and we are ready for a strong finish for the year. With respect to the second one, it’s indeed was a strong quarter for the financial crime and compliance business following actually by now many quarters that were strong for that business and we continue to see the trends -- couple of trends over there. First of all, the suite of our products, the ability to go, we’ve seen tier 1 of customers and further into tier 2 as well and expand beyond one product. Whether that will be AML, anti-money-laundering further compliance and expand to the rest of the suite. So that’s one phenomenon to see which obviously indicates, you see it in the result, it’s very healthy. The second phenomenon I referred to in the comments earlier is that we believe that we are at the beginning of a second wave. The first wave was there was regulation in place, not one, actually many regulations. We continue to see more and more regulations and directives coming into this -- in this domain to financial services and also to non-financial services. That was the first wave; it’s not over yet but it’s definitely a very healthy one. The second wave that you are starting to see is financial services are being approached by the auditors. And now, it’s not just about having the solution in place but it’s also going through audit processes which accelerates further demand of more solutions from that business of ours.

Got it. This is great. This is very helpful. If I may squeeze one more, on the enterprise front, one of the co-center-related activity. Given you guys are now focused strictly on the enterprise, defense, security; that’s behind you. Are you seeing yourselves starting to run into a new list of competitors out there with your solutions, maybe on the analytics front?

Well, the answer is yes. Our competitive landscape as a company is evolving. It evolved in the last two years and you are absolutely right. As we are stepping, we stepped already and now we are stepping into further analytics solutions. We find ourselves competing in a very wide competitive landscape. I see it as good news. Competition at the end of the day is healthy. It means that we are competing for bigger budgets and more business issues of customers. And I believe that we have the right portfolio to differentiate ourselves from the many competitors that are out there. I mentioned on my previous comments actually similarly to the comment before if in the last two years we’ve been educating our existing customers to go from the platform to analytics and introduce analytics capabilities to our customers, we now have a very healthy install base of customers that are already using an analytics solution. And what we see right now and you saw it in the several examples that I mentioned before, it seems they have experienced that already. We are now moving actually to selling them more and more analytics on top of that, addressing additional business challenges that we are not playing in or playing for before.

Thank you so much. Good luck.

Thank you, Shaul.

Your next question comes from the line of Daniel Ives with FBR. Please proceed.

Yeah. Thanks. So maybe you could talk, Barak, about now the divestitures and all the focus on enterprise, how that’s changed the organization? Maybe anecdotally just how much time was spent on some of the other legacy pieces where now strategically the whole organization is all on the same page. Maybe you can just give us some context around that?

Yeah. I can share with you my experience up until the point that we did the divestitures and this wasn’t a coincidence. This was the plan and as we look into our strategic roadmap. The reason why as I said why we did it is it’s a very, very different business. It’s a defense business, completely different set of customers, very different cycles, very different business model. You actually can see some profitability. That’s also very different in terms of profitability, project-oriented. Basically almost all elements are different to the rest of our businesses. And I think it will drive more for the company. The day after and we are in the day or days after, there is a very different NICE. We have a management team that is completely focused on an enterprise software company. There is a single business model for go-to-market model for the company. The product has a lot of synergies to them. The same goes to the go-to-market technologies and end-markets. The day-to-day is obviously different. It allows myself and many other management team members to focus purely on that business and as a result of that to gain more horsepower to our main business.

And just the next step in divestitures, great cash flow generation kind of cash and balance sheet. In terms of acquisitions, just remind us in the philosophy here, I mean, is it being patient? Is it accretive deals? Are they more strategic? Just give us some insight as you think about M&A, now that everything is humming on the overall business.

So obviously now we are focusing on expanding the business. We have much more bandwidth timeshare of the -- and brand power among the management team and some other people among our troops. And we remain very active on the M&A front. We are not rushing to anything but we have a healthy pipeline to execute on. And there can be a multiple path over here. Obviously, we have a very solid organic plan as you can see from our results. But also on the non-organic expansion, the multiple opportunities, some can be on our core business and some can be on close adjacencies to the markets where we are starting to penetrate and accelerate the way over there. Obviously we always like to see acquisitions that are accretive relatively faster from day one. And when it comes to acquisition, we look on all the different parameters starting from strategic fits to our roadmap and overall strategy but also the financial. And I think we have a very good balance sheet to support this element.

Thanks again, guys.

Your next -- your next question comes from the line of Greg McDowell with JMP. Please proceed.

Great. Thank you very much. Nice to see the improvement year-over-year and I want to focus my question on operating margins. Certainly operating margins and general operational excellence has been a big theme for you guys for the last year and a half. As we think about sort of going into 2016, how should we thematically think about your philosophy on operating margins going forward? It certainly feels like we are perhaps not going to get the same rate of operating expansion in 2016. And as we creep up to that sort of 30% level, did you start to get to a point where you feel like you want to step on the gas and invest more in sales and marketing and maybe not let so much drop to the bottom line? That’s my first question. Thanks.

Hi, Greg. Thank you for the question. So with respect to the operating margin -- so, if you look on the numbers this quarter, the operating margin improvement is the result of multiple components. First one is due to the high growth in the product sales we grew by 13% on the product sales. You can see that the gross margin improved very nicely for the quarter and obviously impacted very nicely the operating margin as well. And we believe that this mix of product versus services can fluctuate in quarters but overall as an annual number we know exactly or we believe we know where the number is. And obviously, the rest of the improvement came from a multiple factors for the divestiture, is a much more simplified organization but many other efficiencies and streamlining the business and the things that I’ve covered in previous calls. We are doing well on the plan of improvement over here. We are far from being done. And I believe that we still have room for improvements in the operating margin and I believe also that we have a very nice leverage in the model forward.

Great. Thank you. And one quick follow-up. I have noticed on the last couple of earnings calls that competitive replacements or competitive displacements has been a major theme for you guys; and I was just wondering if you could expand on whether you think this is a multi-year phenomenon or maybe just a multi-quarter phenomenon. To that end, is this more about your product portfolio just getting stronger, or is it more about the competitors’ product portfolios getting weaker and maybe your competitors has just taken their eye off the ball? I would just love to hear more about the competitive replacements. Thanks.

So you are right, we see in the last few quarters a healthy trend in competitive replacement. I referred to that on this call and also if I am not mistaken the last couple of calls if maybe even more than that. And we do see an uptick and increase in the rate of competitive replacements. I would attribute this increase to several things. I will refer mainly to what we do. The first one is the rate of product innovation that we have accelerated on and I think the market is reacting to that. And it enables us multiple angles or multiple ways of entering a competitive account. If you would like kind of landing expense -- landing accounts and then starting to expand and I gave the example of that particular financial institution that has a mix of us and competitors and eventually, this quarter decided to buy from us a full suite of products and say goodbye to the competitive products. So that’s the second element -- the portfolio itself. And thirdly, a very, very focused go to market that is, we are streamlined and well organized and we will continue to go aggressive in that direction and hopefully, seeing that rate of competitive utilization continues to go up.

Great. Thank you very much.

Thank you, Greg

Your next question comes from the line of Paul Coster with JP Morgan. Please proceed.

Yes. Thanks very much for taking my questions. First up, clearly the backlog is in pretty good shape at the moment. Can you give us any metrics around the magnitude of it? How far out it gives you visibility and what the mix of business you have in that pipeline, please?

Hi, Paul. Thank you very much for the question. We don’t provide data on the backlog as you know also historically. I will go back to my comments that we see a healthy pipeline for the fourth quarter and we are now very much focused on executing on it.

Okay. I mean, is it principally doing more business with existing customers and the upsell that’s fueling it or is there a significant mix of new de novo customers in there?

It’s actually a combination of the two. Actually a combination of, I would say, even three. The first one is always there is ongoing upgrades of customers taking the existing solution and moving to the latest and greatest. The second as you exactly hinted or said is about selling, cross-selling. The portfolio today is read wide and we have the ability to offer our customers a variety of expansion opportunities. And the third there is indeed the competitive replacements. So, I would say it’s all of the above plus the upgrades.

You talked to portfolio deals in your prepared remarks. It sounds like it’s a sort of code word for the way in which you go to market. Could you just give us a little bit of color about how this might work with a large customer?

Absolutely, Paul. So, I will take two examples. One is completely a new customer to NICE and there are multiple ways of going after that one is to offer one very particular product to address a specific business need. And later on, after they experience that and we gain credibility with that customer to go and sell additional capabilities at the end of the day after holding several quarters or several years, they have a very large element of our portfolio. But we see a trend which I’ve been talking about, I believe, in the last three quarters about us either coming to existing customers or to new customers and offering a much wider range of the portfolio due to two reasons. First is the desire to do one time -- projects at one time and benefit from multiple elements at the same time. That’s one reason for a customer to go in that direction. And second is, if you would like, the commercial benefit of looking on it all together. So, all of those options are available and I think our sales team today is more mature than several years back in the ability to form and to explain the value proposition of going after the full portfolio versus just a distinct product.

Okay. My last question is, you are a horizontal solution provider with a one distinct vertical in financial services. Do you see other verticals that can maybe incorporate domain expertise and you can go to market in a more distinct manner? I am thinking particularly around healthcare.

You are actually very right and our financial crime is an example. Our financial crime and compliance solution -- I already hinted to that in my comments before. We’ve seen it in the past and we are starting to see it further. It’s starting to go beyond financial services. There is one immediate market and there is even further markets. The one immediate market after financial services is financial services that are not pure financial services. That can be an insurance company and it can be a digital wallet company. It can be an Internet company that also provides financial services that are starting to either get regulated or concerned about getting regulated so that’s one aspect. And the second aspect which is a thorough adjacency we bought. We see that we have many components to do that and we’ve done it in several examples is taking it to other verticals. Like for example, as you mentioned, healthcare and we can think of several other industries -- we see interest in several other industries. The components that allows us to do that, not the only one, I’ve mentioned it in my comments before is our enterprise case manager, which allows us to actually diversify the portfolio and build additional use cases which are not pure financial services-related.

Very good. Thank you very much.

Thank you, Paul.

Your next question comes from the line of Jonathan Ho with William Blair. Please proceed.

Hi. Congratulations on the strong quarter. I just wanted to dig in a little bit around the geographic side of things to start. North America was a little bit slower this quarter at 4%. I just want to understand was there some Canadian currency impact there? Or I just wanted to understand sort of the dynamic around North America versus the strong growth in both EMEA and APAC?

So, actually, the results that you see our with respect to the geographic split separated to Americas -- EMEA, which is Europe Middle East and Africa and Asia Pacific. Actually the growth in North America -- in Americas, overall, the growth was a bit slower but it mainly came from Latin America and actually North America was healthy. And I think it’s mainly due to the economic that we see in certain countries in Latin America. And we believe that the weakness is hopefully something that is temporary and we will see a resume of the growth moving forward.

Got it. And then can you talk a little bit about what happened with the customer interaction growth rate? This was essentially flat year-over-year and yet you guys have talked about both the strong demand environment as well as the strong pipeline. Can you maybe help reconcile sort of what you are seeing in terms of future growth opportunity versus kind of more of a flat result this quarter?

So, we see many opportunities moving forward in that business. This business is transforming and evolving for us. It’s actually built from multiple areas in many, many different products. I’ve mentioned in my comments about our analytics business, which is also part of a big chunk of that business as well, has actually been growing very nicely this quarter. And I think that, as we see analytics solutions continue to expand and grow, we will see that business also growing. If you look overall this year if I am not mistaken, we saw a very nice growth in the first quarter for the business. This business is a bit weaker in the second and third quarter and we are actually expecting healthy strong finish for the fourth quarter.

Great. Thank you.

Thank you, Jonathan.

Your next question comes from the line of Dan Bergstrom with RBC Capital. Please proceed.

Hi. And thanks for taking my questions. Say at interactions, you talked to new digital criminal justice market opportunities that you size at about $1 billion and then last week I noticed you announced a new digital policing solution to expedite the digital investigation process. Is this the first of several products to address that opportunity, maybe you could talk about how that product came about and if there is a similar opportunity to say repurpose and productize existing assets?

Absolutely. We have a lot of things to share for the quarter so we will probably skip on that, but it’s definitely a very exciting part of what we do. And we did -- we indeed launched a solution to address what we see as a very fast growing opportunity in the digital criminal justice market. We actually participated in a big show that took place earlier last week and launched the solution over there which you see in the press release on that. And I think it’s one out of multiple opportunities for innovations that we have in this market. We get very good traction from customers in that area. There is a transformation happening in this market. And we are very much set with the innovation and the ingredients that we have to capitalize on the opportunity that we have in this market.

Thanks. And then maybe one for Sarit. Sarit, can you talk to the cadence of the product line through the year? It looks like maybe Q2 maybe a little stronger than Q3 now after all the divestitures, is that how we should be thinking about the seasonality there?

Thanks, Dan. As we said before, there may be an [obsession 40:54] [ph] between the quarters in the composition of the revenue, but overall we see quarter-over-quarter that the revenue from products is growing. Obviously we are backend-loaded so we will see additional increase, we expect to see additional increase in Q4. I don’t attribute any significance to this quarter versus the last year quarter in this regard.

Thank you.

Your next question comes from the line of Tal Grant with UBS. Please proceed.

Hi. Thanks for taking my question. And congratulations on the good quarter. Just wondering a couple of financial questions first of all. So, obviously, you called the revenues quite well in your guidance but earnings you underestimated that. Just wondering what came in better than expected there exactly? Or what in your planning didn’t pan out as badly as you thought, what panned out better than you thought it would? And second of all, I don’t know -- I am not sure if you’ve given us the exact numbers for the disposed business for last year but I am working out, you’ve given us rough numbers and I am working out 4% to 10% organic growth in Q4 this year. Just wondering, is the low end quite conservative there, I mean considering you’ve got all these tailwinds in the customer interactions business?

Hi, Tal. So with regard to the results of Q3, obviously it has to do with the revenue mix and the favorable sales of product that we had this quarter, which resulted in a higher gross margin, which contributed to the higher profitability. And with regards to the fourth quarter, we provided the guidance as we see it. Now again, we reiterated the annual revenue narrowed the range and we raised the EPS. So we do expect to see a strong Q4 and a strong end to the year.

Okay. And the revenue mix in Q3, so was that stuff that was full forward from Q4, is that why you didn’t anticipate that?

No, it’s simply the mix of the product as we mentioned before. There are products that come with higher margins and there are products that the margin can be slightly lower, for example if we pay royalties of such. So the mix of revenue can make a difference and can cause fluctuation in the gross margin between the quarters.

So your visibility on mix of product sales isn’t very good basically. You can’t easily predict what the mix will be in a given quarter.

Hi, Tal, it’s Barak. I wouldn’t say exactly that. I mean one deal to the left, to the right that hit the quarter or missed the quarter can change the mix. I think we have a good visibility but on the products side again one deal can change it to the left or to the right and obviously that mix -- those few deals or a deal can change obviously the mix within the quarter.

Okay. And just another just a thematic question, I guess. There’s a few companies doing more and more in artificial intelligence with respect to [indiscernible 44:50]. Is that a threat for an opportunity, or how do you see that whole thing playing out?

We don’t see much competing with what we do. I think that there is a lot of analytics in the market almost in every industry. I think that our distinct value is that we don’t provide a generic analytics but rather in context, specifically in customer service and in call centers. We have here 20-plus years of domain expertise and I think that’s the reason why customers are choosing us versus taking a generic analytical tool artificial or not with lacking the business applications comes with that. And if from time to time there is such competition, actually welcome that, it helps us to educate the market about the benefits in adding analytics to different areas of operations of companies, whether that will be in the front-office or the back-office and eventually we benefit from that.

Okay. Great. Thanks very much.

Thank you, Tal.

Your next question comes from the line of Tavy Rosner, Barclays. Please proceed.

Hi. Thank you. I was wondering if you could give some color with regard to cloud adoption?

Thank you for the question. We don’t break down cloud. It still is a small part of our business. It’s part of the number that Sarit provided before. On professional services, we continue to track it. We work diligently in our cloud business to provide more and more for our solutions in cloud. Actually many of them, if not all of them today, can be provided either on premise, in cloud. And as it will go faster and become a bigger chunk of our business, we may consider to break this down.

Okay. Thank you. And you talked before about focusing on the enterprise market, and I was wondering if you saw any potential of value in going after perhaps the SME through a SaaS offering?

It’s a very good question. We actually operate in all segments of the markets, both at the highest tiers. You can call it tier 0 or tier 1 where we have a very, very strong presence. But we also play in the mid-market and all the way down to the SME or SMB markets and we do that through distribution. I definitely agree with you when we see that when we come with our cloud offering, it is adopted more at the lower end of the market versus the higher end of the market.

Thank you.

Thank you very much.

Your next question comes from the line of Gilad Alper, Excellence. Please proceed.

Hi. Thanks for taking my question. So I have two questions actually. First one is just on sales and marketing. The way I calculated it at least it looks like non-GAAP sales and marketing comes out to like around 22% of revenues. Can we expect this low level to continue going forward? Thanks. And I have another question afterwards.

I don’t have the exact number. This is a number, yeah. It can fluctuate -- sales and marketing include multiple things over there, obviously the personnel within sales and marketing but also different events that we are doing and they don’t happen every year. We have a user conference and many other things. As well as in the sales, there is an element of commission so it can fluctuate between one quarter to another.

Okay. Good. And the second one is a little bit speculative I guess. But on today we saw GDP numbers from the U.S. come in a little bit lower than expected and possibly the economy is slowing down in the U.S. which is your most important region. So again, it’s a very wide question but would you characterize your business as very sensitive to the macro environment, just average tech company, possibly more resilient to macro weakness? That’s it.

So I get this question every once in a while and a lot of our business, not all of it but a big chunk of our business comes to mitigate the need to comply, as I have mentioned before with different regulations. So we see ourselves and we saw it in the past, even in the financial crisis several years back, we saw ourselves less impacted by that or not even at all, though we are not that concerned. And we don’t use the macroeconomics as an excuse to our business and our performances. We believe that with good execution, we can grow the business.

Okay. Cool. Thanks.

There are no further questions in the queue. And I would now like to turn the call over to Barak for any closing remarks.