Release Date: November 04, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Intapp Inc (INTA, Financial) reported a strong fiscal first quarter with cloud ARR growing to $309 million, up 27% year over year.
- The company achieved a 30% year-over-year increase in SaaS revenue, reaching $77 million.
- Intapp Inc (INTA) expanded its AI capabilities with new features for INAP assist, enhancing client adoption and validating its AI strategy.
- The strategic partnership with Microsoft was furthered, contributing to increased co-marketing and co-selling activities.
- Intapp Inc (INTA) saw a 32% year-over-year increase in total remaining performance obligations, indicating strong future revenue potential.
Negative Points
- Professional services revenue declined by 8% year over year, reflecting a strategic shift away from services revenue.
- There was a noted deceleration in cloud ARR growth, raising concerns about future growth acceleration.
- The company experienced lumpiness in large deals, which could impact revenue predictability.
- Intapp Inc (INTA) is facing challenges in migrating existing clients to the cloud, which could delay revenue recognition.
- The focus on expanding the partner ecosystem may require significant investment, potentially impacting short-term profitability.
Q & A Highlights
Q: Can you provide an update on the current deal environment and any changes in the financial services sector?
A: David Morton, CFO: We haven't seen any changes in the deal environment. Demand remains strong, and our pipeline is robust. While there is some lumpiness in large deals, we haven't observed any macroeconomic impacts, even in financial services.
Q: How should we think about the impact of your alliances, particularly with Microsoft, on your revenue growth?
A: John Hall, CEO: The Microsoft partnership is significant, with increased co-marketing and co-selling activities. Our products are available on the Azure marketplace, and Microsoft sales reps receive commissions for selling Intapp products. This partnership is expected to enhance our growth over time.
Q: Can you elaborate on the changes in your sales team and their impact on productivity?
A: John Hall, CEO: We tested a new model in fiscal '24 and saw excellent results. At the start of fiscal '25, we moved more sellers into this model, focusing on enterprise accounts. This realignment aims to capitalize on the opportunity to reach a billion dollars in revenue.
Q: What is the potential for cloud ARR growth to accelerate, and what would drive this?
A: John Hall, CEO: We are focused on selling cloud solutions, acquiring new logos, and migrating existing clients to the cloud. As we target larger firms, which offer significant opportunities, we expect to see exciting results, although these deals can be lumpy.
Q: How are you approaching the conversion of on-prem customers to SaaS, and what changes are expected in fiscal '25?
A: John Hall, CEO: We are encouraging firms to move to the cloud by highlighting the benefits of generative AI capabilities, scalability, and security. We have launched a program to assist firms in transitioning to the cloud, which is expected to drive significant expansion.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
