Logility Supply Chain Solutions Inc (LGTY) 2024 Q4 法說會逐字稿

Good day, everyone, and welcome to today's fourth quarter and fiscal year 2024 earnings results call.(Operator Instructions) Please note this call is being recorded, and I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to Vince Klinges. Please go ahead, sir.

大家好，歡迎參加今天的2024財年第四季和全年收益業績電話會議。 （操作員指示）請注意，本次通話正在錄音，如果您需要任何協助，我將隨時待命。現在我很高興將會議交給文斯克林格斯 (Vince Klinges)。先生，請繼續。

Thank you, Travis, and good afternoon, everyone, and welcome to American Software's fourth quarter fiscal 2024 earnings call. On the call with me is Allan Dow, President and CEO of American Software. Allan will provide some opening remarks and then I will review the numbers.

謝謝你，崔維斯，大家下午好，歡迎參加美國軟體公司 2024 財年第四季財報電話會議。與我一起通話的是美國軟體公司總裁兼執行長艾倫·道 (Allan Dow)。艾倫將致開場白，然後我將回顧這些數字。

But first, our Safe Harbor statement. This conference call may contain forward-looking statements, including statements regarding, among other things, our business strategy and growth strategy. Any such forward-looking statements speak only as of this date. These forward-looking statements are based largely on our expectations and are subject to a number of risks and uncertainties, some of which cannot be predicted or quantified and are beyond our control.

但首先，我們要先聲明一下我們的安全港。本次電話會議可能包含前瞻性陳述，其中包括有關我們的業務策略和成長策略等的陳述。任何此類前瞻性陳述僅代表截至目前的觀點。這些前瞻性陳述主要基於我們的預期，並受到許多風險和不確定性的影響，其中一些無法預測或量化，也超出了我們的控制範圍。

Future developments and actual results could differ materially from those set forth in contemplated by or underlying the forward-looking statements. There are a number of factors that could cause actual results to differ materially from those anticipated by statements made on this call. Such factors include, but are not limited to changes and uncertainty in general economic conditions, the growth rate of the market for our products and services, timely availability and market acceptance of these products and services, the effective competitive products and pricing and other competitive pressures and the irregular and unpredictable pattern of revenues. In light of these risks and uncertainties, there can be no assurance that the forward-looking information will prove to be accurate.

未來發展和實際結果可能與前瞻性陳述中預期或潛在的結果有重大差異。有許多因素可能導致實際結果與本次電話會議中預期的結果有重大差異。這些因素包括但不限於一般經濟狀況的變化和不確定性、我們產品和服務的市場成長率、這些產品和服務的及時供應和市場接受度、有效的競爭產品和定價以及其他競爭壓力以及不規則和不可預測的收入模式。鑑於這些風險和不確定性，無法保證前瞻性資訊的準確性。

At this time, I'd like to turn the call over to Allan for opening remarks.

現在，我想將電話轉給艾倫，請他致開幕詞。

Thank you, Vince. Good afternoon, everyone, and thank you for joining us today. Although challenging from an economic standpoint, fiscal 2024 was a pivotal year for American Software. Strategically, we transformed our company through the divestitures of the proven method and transportation rating solutions, leaving us with a singular focus on our core supply chain software business moving forward.

謝謝你，文斯。大家下午好，感謝大家今天的參與。儘管從經濟角度來看充滿挑戰，但 2024 財年對美國軟體來說卻是關鍵的一年。從策略上講，我們透過剝離成熟的方法和運輸評級解決方案實現了公司轉型，讓我們能夠專注於核心供應鏈軟體業務的發展。

This transformation will become more evident later this year as we plan to rename the company Logility and trade under the ticker symbol LGTY. Most important is that our Logility brand is already known to our existing client community and prospects. And Logility was recognized by Gartner as a leader in the latest Magic Quadrant for supply chain planning solutions. So this change will align the company with our brand.

隨著我們計劃將公司更名為 Logility，並以股票代號 LGTY 進行交易，這種轉變將在今年稍後變得更加明顯。最重要的是，我們的 Logility 品牌已經為我們的現有客戶群和潛在客戶所熟知。Logility 被 Gartner 評為最新供應鏈規劃解決方案魔力像限的領導者。因此，這項變更將使公司與我們的品牌保持一致。

To further distance ourselves from the competition, we accelerated our AI roadmap significantly in fiscal 2024 with the acquisition of Garvis. As we shared last quarter, the Garvis products has been rebranded with demand AI-plus and the early indications suggest that the new capabilities will benefit us on three fronts.

為了進一步拉開與競爭對手的距離，我們在 2024 財年收購了 Garvis，大大加快了我們的人工智慧路線圖。正如我們上個季度所分享的，Garvis 產品已更名為 demand AI-plus，早期跡象表明，新功能將在三個方面使我們受益。

The addition of new logos to our client community, an accelerated pace of existing client lift and shift to the cloud and upgrades of existing cloud clients to this next generation of demand forecasting. Given that demand AI-plus represents our next generation demand intelligence platform and is only available in the cloud, we recently informed our clients that new innovation will no longer be available on-premise.

在我們的客戶社群中加入新的標識，加快現有客戶向雲端遷移的步伐，並將現有雲端客戶升級到下一代需求預測。鑑於需求 AI-plus 代表我們的下一代需求智慧平台並且僅在雲端可用，我們最近通知客戶，新的創新將不再在本地提供。

We believe this will further catalyze the conversion of our maintenance revenue to subscription fees over the next several years. Even as we bolstered our platform through M&A we continued to return capital to our shareholders via our usual quarterly dividend. And for the first time in many years, we repurchased stock in the open market fully utilizing the remaining amounts of our prior authorization.

我們相信，這將在未來幾年進一步促進我們的維護收入轉換成訂閱費的。即使我們透過併購增強了我們的平台，我們仍然繼續透過通常的季度股利向股東返還資本。多年來，我們首次在公開市場上回購股票，並充分利用了先前授權的剩餘金額。

Finally, we reached a definitive agreement with our founder and Class B shareholder, [Jim Edenfield], which subject to shareholder approval, will eliminate our dual-class structure. In aggregate, we believe the actions we have taken over the past year will create significant shareholder value in the years to come.

最後，我們與創辦人兼 B 類股東 [Jim Edenfield] 達成了最終協議，該協議在獲得股東批准後將取消我們的雙重股權結構。總的來說，我們相信我們在過去一年採取的行動將在未來幾年創造巨大的股東價值。

Turning to the fourth quarter, our results were largely as expected, and we were pleased to meet the revised guidance for the full year that we provided midway through fiscal 2024. Similar to our experience over the past year, our clients and prospects remain engaged on transformational supply chain initiatives, but have delayed approvals or start dates and in some cases, staged commitments over multiple phases amid persistent macroeconomic headwinds.

展望第四季度，我們的業績基本上符合預期，我們很高興能夠達到我們在 2024 財年中期提供的全年修訂指引。與我們過去一年的經歷類似，我們的客戶和潛在客戶仍然致力於轉型供應鏈計劃，但在持續的宏觀經濟逆風中推遲了批准或開始日期，在某些情況下，分階段做出承諾。

Our pipeline, again grew from the improved levels we saw in the third quarter, reflecting both strong interest in our new AI capabilities as well as an increase in late-stage deals that remain in the closed process. Although pipeline conversions remains below historic norms, we continued to see improvement relative to the start of the fiscal year, resulting in a sequential uptick in our backlog that was partially driven by contracts signed late in the fiscal quarter.

我們的管道再次從第三季度的改善水平上增長，這反映了人們對我們新的人工智慧功能的濃厚興趣，以及仍處於結束階段的後期交易的增加。儘管管道轉換率仍低於歷史標準，但相對於財年初，我們繼續看到改善，導致我們的積壓訂單量環比上升，部分原因是本財季末簽署的合約。

Contributing to the backlog growth in the fourth quarter was greater desire among our clients to move from on-prem to our enhanced capabilities in the cloud, interest from our cloud clients and upgrading to the AI forecasting approach with DAI plus, the acceleration of generative AI capabilities, a number of Garmin Pilot clients expanding the footprint more broadly across their enterprise, and the traction with our continuous network optimization capabilities that provide insights into navigating around the bottlenecks in supply chains.

第四季度積壓訂單成長的貢獻因素包括：客戶更渴望從本地遷移到我們增強的雲端功能；雲端客戶感興趣並使用 DAI plus 升級到 AI 預測方法；產生 AI 功能的加速；許多 Garmin Pilot 客戶在其企業範圍內更廣泛地擴展業務範圍；以及我們持續的網路優化功能的推動，這些功能為解決供應鏈瓶頸提供了見解。

We're are on the forefront of releasing new AI based capabilities that expand value for our clients by enhancing our decision making such as inventory AI plus, which we announced in the spring and most recently the decision command center. We have other groundbreaking solutions on the horizon for the year ahead.

我們正處於發布基於人工智慧的新功能的前沿，透過增強我們的決策能力來為客戶擴大價值，例如我們在春季宣布的庫存人工智慧加 (AI plus) 以及最近宣布的決策指揮中心。我們也將在未來一年推出其他突破性的解決方案。

As we look forward to the current fiscal year, we're encouraged by the level of pipeline growth experienced throughout the latter half of fiscal 2024. We are poised to invest ahead of the growth as soon as we see the economic pressures and uncertainties subside and pipeline conversion starts to accelerate.

展望本財年，我們對 2024 財年下半年的管道成長水準感到鼓舞。一旦我們看到經濟壓力和不確定性消退並且管道轉換開始加速，我們就準備在成長之前進行投資。

At the same time, the timing of deal closures, particularly large transactions, remains difficult to predict and can meaningfully impact the revenue we recognize in any given period. Thus, while we believe our cloud bookings should grow at a higher rate and translate into accelerating subscription fee growth exiting the year our initial outlook for fiscal 2025 reflects conservative assumptions around the timing of client spending decisions and the delayed revenue impact from late year bookings.

同時，交易完成的時間，特別是大型交易，仍然難以預測，並且會對我們在任何特定時期確認的收入產生重大影響。因此，雖然我們相信我們的雲端預訂量應該以更高的速度成長，並轉化為年底訂閱費的加速成長，但我們對 2025 財年的初步展望反映了對客戶支出決策時機和年底預訂對收入的延遲影響的保守假設。

Taking all this into consideration our initial guidance for fiscal 2025 includes total revenue of $104 million to $108 million, recurring revenue between $87 million and $89 million and adjusted EBITDA of $15 million to $16.4 million. At this time, I will turn the call over to Vince, who will provide the details of our financial results.

考慮到所有這些因素，我們對 2025 財年的初步預期包括總收入 1.04 億美元至 1.08 億美元、經常性收入在 8700 萬美元至 8900 萬美元之間以及調整後的 EBITDA 1500 萬美元至 1640 萬美元。現在，我將把電話轉給文斯，他將提供我們的財務結果的詳細資訊。

Thanks, Allan. Before I discuss the results for the quarter, I'd like to remind everyone that due to the divestiture of the second quarter of our noncore IT staffing business unit, the proven method, our financial statements have been recast to show the proven method as a discontinued operation.

謝謝，艾倫。在討論本季的業績之前，我想提醒大家，由於我們第二季度剝離了非核心 IT 人員配置業務部門（即經過驗證的方法），我們的財務報表已重編，將經過驗證的方法顯示為已停止的業務。

Results from the transportation ratings solutions were not considered material enough to recast as discontinued operations and are still reflected in our prior year comparisons for continuing operations. Our discussion of the current and comparable periods will focus only on the continuing operations from this point on.

運輸評級解決方案的結果被認為不夠重要，不足以重新定義為停止運營，並且仍然反映在我們上一年持續運營的比較中。從現在起，我們對當前和可比較期間的討論將僅集中於持續經營。

So for the fourth quarter, our total revenues were $25.4 million, decreased 5% from $26.8 million in the same period last year, and that's primarily due to lower revenues from our license fees and professional services and maintenance.

因此，第四季度我們的總收入為 2,540 萬美元，比去年同期的 2,680 萬美元下降了 5%，這主要是由於我們的許可費和專業服務和維護收入減少。

Our subscription fees increased 8% year-over-year to $14.1 million compared to $13 million the same period last year. Our software license revenues were $0.2 million and that compares to $0.7 in the same period last year. Professional services and other revenues decreased 23% to $3.7 million from$ 4.8 million in the year ago period. And that's primarily due to lower bookings earlier in the year and also our efforts to direct more services to our SI partners.

我們的訂閱費年增 8%，達到 1,410 萬美元，而去年同期為 1,300 萬美元。我們的軟體授權收入為 20 萬美元，而去年同期為 70 萬美元。專業服務和其他收入從去年同期的 480 萬美元下降 23% 至 370 萬美元。這主要是因為今年稍早的預訂量較低，以及我們努力為 SI 合作夥伴提供更多服務。

Our maintenance revenues declined 9% year-over-year to $7.4 million, reflecting a normal falloff rate this quarter as well as the divestiture of our transportation group, which reduced our maintenance revenues by approximately $250,000 for the quarter. So our total recurring revenues comprised of subscription and maintenance fees represented 85% of the total revenue for the fourth quarter, and that compares -- that's up from 79% in the same period last year.

我們的維護收入年減 9% 至 740 萬美元，反映了本季的正常下降率以及運輸集團的剝離，這導致本季的維護收入減少了約 25 萬美元。因此，由訂閱費和維護費組成的總經常性收入佔第四季度總收入的 85%，相比之下，這一比例高於去年同期的 79%。

Our gross margin was 66% for the current period, up from 65% in the same period last year. Our subscription fee margin was 68% for the current quarter and prior year period. Excluding the noncash amortization of intangibles of $232,000, our subscription gross margin was 70% in the current period, and that's compared to 71% in the same period last year.

本期我們的毛利率為66%，高於去年同期的65%。本季和去年同期我們的訂閱費利潤率為 68%。不包括 232,000 美元的無形資產非現金攤銷，本期我們的訂閱毛利率為 70%，而去年同期為 71%。

The amortization of intangible expense was $398,000 in the same period last year. The decline in noncash amortization expense from the prior year period -- compared to the most recent period reflects the change in the garbage acquisition technology amortization life from three to five years. Our license fee margin was 68% compared to 77% in the same period last year. Our gross margin for services decreased to 26% compared to 30% last year. And our maintenance margin was 81% for the current period, and that's up from 80% in the same period last year.

去年同期無形費用攤提為398,000美元。與最近一期相比，去年同期非現金攤銷費用的下降反映了垃圾收集技術攤銷年限從三年變為五年。我們的許可費利潤率為 68%，而去年同期為 77%。我們的服務毛利率從去年的 30% 下降至 26%。本期我們的維持利潤率為 81%，高於去年同期的 80%。

Our gross R&D expenses were 18% of total revenues for the current period, and that compares to 17% in the prior year period, but we're virtually unchanged in absolute dollars. Sales and marketing expenses were 21% of revenues for the current quarter, and that compares to 18% in the prior year period, primarily due to increased marketing activities and costs related to the Garvis acquisition. Our G&A expenses were 23% of total revenues for the current quarter, and that compares to 22% last year. The increase was due to inclusion of approximately $550,000 of one-time expenses related to the planned elimination of our dual-class structure.

我們本期的研發總支出佔總收入的 18%，而去年同期為 17%，但以絕對金額計算幾乎沒有變動。本季銷售和行銷費用佔收入的 21%，而去年同期為 18%，這主要是由於行銷活動增加以及與 Garvis 收購相關的成本增加。本季我們的一般及行政費用佔總收入的 23%，而去年這一比例為 22%。增加的原因是納入了與計劃取消雙重股權結構有關的約 55 萬美元的一次性費用。

So operating income was $0.7 million. This quarter compared to $2.2 million in the same period last year, primarily due to lower revenues and also costs related to Gavis acquisition and the nonrecurring expenses related to our B class structure. Net income was $2.2 million, or earnings per diluted share of $0.07 compared to net income of $2.9 million or $0.09 to diluted share last year. On an adjusted basis, which excludes non-cash amortization of intangible expense related to acquisitions and stock-based compensation expense.

因此營業收入為 70 萬美元。本季與去年同期相比為 220 萬美元，主要原因是收入下降以及與 Gavis 收購相關的成本以及與我們的 B 類結構相關的非經常性費用。淨收入為 220 萬美元，即每股攤薄收益 0.07 美元，而去年淨收入為 290 萬美元，即每股攤薄收益 0.09 美元。經調整後，不包括與收購和股票薪酬費用相關的無形費用的非現金攤提。

Our adjusted operating income was [2.7], and that compares to [3.7] in the same period last year. Adjusted EBITDA was $3.1 million compared to $4.3 million in the fourth quarter of last year. And our adjusted net income was $4 million or adjusted for earnings per diluted share of about $0.12 for the fourth quarter. And that compares to adjusted net income of $4.2 million and adjusted earnings per diluted share of $0.12 for the same period last year.

我們的調整後營業收入為 [2.7]，而去年同期為 [3.7]。調整後的 EBITDA 為 310 萬美元，而去年第四季為 430 萬美元。我們第四季的調整後淨收入為 400 萬美元，調整後每股收益約為 0.12 美元。相較之下，去年同期調整後淨收入為 420 萬美元，調整後每股攤薄收益為 0.12 美元。

International revenues this quarter were approximately 20% of total revenues compared to 19% last year. We exited the quarter with remaining performance obligations or RPO, which we refer to as backlog of $128 million, which is an 8% increase sequentially and a 3% year-over-year increase.

本季國際營收約佔總營收的 20%，而去年為 19%。本季結束時，我們的剩餘履約義務或 RPO（我們稱之為積壓訂單）為 1.28 億美元，比上一季成長 8%，比去年同期成長 3%。

Looking at our balance sheet, our financial position remained strong with cash investments of $83.8 million at the end of the quarter. And during the quarter, we paid $3.7 million of dividends. Our days sales outstanding as of April 30, 2024, was a 101 days for the current period compared to 78 days in the same period last year.

從我們的資產負債表來看，我們的財務狀況依然強勁，本季末的現金投資為 8,380 萬美元。本季度，我們支付了 370 萬美元的股息。截至 2024 年 4 月 30 日，本期應收帳款週轉天數為 101 天，去年同期為 78 天。

And that's due to timing of increased billings at the end of the quarter, which majority were subsequently court collected and our current DSOs at the end of the month of May was 77 days. As Allan mentioned, related to our guidance, consistent with our usual seasonality, our guidance for fiscal 2025 assumes our bookings will be weighted more heavily towards the latter half of the year. Relative to the fiscal year of 2024, we expect to see an increase in the existing client conversions across cloud, which combined with the sale of TRS will result in greater decline in maintenance than we have seen in past years.

這是由於本季度末帳單增加的時間所致，其中大部分隨後由法院收取，而我們 5 月底的當前 DSO 為 77 天。正如艾倫所提到的，與我們的指導相關，與我們通常的季節性一致，我們對 2025 財年的指導假設我們的預訂量將更多地集中在下半年。相較於 2024 財年，我們預期現有客戶在雲端的轉換率將會增加，再加上 TRS 的銷售，維護費用的下降幅度將超過過去幾年。

As a reminder, we typically see an uplift of 2x to 3x revenue when our clients lift and shift to the cloud. So we anticipate our subscription fee growth will accelerate exiting this year. So the guidance we're providing for fiscal 2025, we anticipate revenue in the range of $104 million to $108 million, including recurring revenue, $87 million to $89 million and adjusted EBITDA, we anticipate a range of $15 million to $16.4 million.

提醒一下，當我們的客戶遷移到雲端時，我們通常會看到收入增加 2 倍到 3 倍。因此，我們預計今年我們的訂閱費成長將會加速。因此，我們為 2025 財年提供的指導是，我們預計收入將在 1.04 億美元至 1.08 億美元之間，其中包括經常性收入 8700 萬美元至 8900 萬美元，調整後的 EBITDA 預計在 1500 萬美元至 1640 萬美元之間。

At this time, I'd like to turn the call over to questions.

現在，我想將電話轉給提問者。

(Operator Instructions) Zach Cummins.

（操作員指示）扎克·康明斯。

Good afternoon, Allan, Vince, thanks for taking my questions. Allan, I just wanted to ask you around the current buying environment. It sounds like you're seeing some hesitation from some of your customers at this point, just trying to grapple how they move forward with project start time. So just curious of how those conversations have evolved versus maybe what you were seeing three or six months ago?

下午好，艾倫、文斯，謝謝你們回答我的問題。艾倫，我只是想向您詢問當前的購買環境。聽起來你發現現在有些客戶有些猶豫，他們只想弄清楚如何推進專案的啟動時間。所以我只是好奇這些對話與三個月或六個月前看到的情況有何變化？

Look, first of all, Zach, good afternoon and thanks for joining us. Great question. Yes, the economic environment, although earlier in the year when we last met -- got together, we were anticipating an interest rate drop. I think everyone was encouraged by though the long-term prospects of the economy improving and since then that really hasn't occurred as we all know and see. That has translated into a continued stall in the marketplace relative to projects. We were able obviously able to break some projects lose. Few of the projects we signed actually have deferred start dates.

首先，扎克，下午好，感謝您加入我們。好問題。是的，經濟環境，儘管今年早些時候我們上次見面時，我們預計利率會下降。我認為每個人都對經濟長期改善的前景感到鼓舞，但自那以後，正如我們所知和所見，這種情況並沒有真正發生。這導致市場在專案方面持續停滯。我們顯然能夠打破一些專案的失敗。我們簽署的項目很少有真正延後開工日期的。

So we're not doing any activity, even though we were able to execute the contract. So that is a direct reflection in the increased RPO, but had an impact on the revenue that we were not able to capture in the fourth quarter nor will we in one case even in this first quarter and people are breaking up the projects. They're going for much smaller bites.

因此，儘管我們能夠履行合同，但我們沒有採取任何行動。因此，這直接反映在 RPO 的增加上，但對收入產生了影響，我們無法在第四季度獲得這些收入，甚至在第一季也無法獲得這些收入，因此人們正在拆分這些項目。它們想要吃更小的食物。

Just trying to be conservative, you get something done keep some powder dry gas you so to speak. They want to proceed with Phase 2, but they want to make that decision as they see how things unwind here as the year continues, the calendar year continues. So very conservative approach, probably less conservative than we were experiencing earlier on.

只是試著保守一點，你完成了一些事情，可以說保留一些火藥乾燥氣體。他們希望繼續進行第二階段，但他們希望在觀察一年又一年事情進展後再做決定。所以我們的方法非常保守，可能不像我們之前所經歷的那麼保守。

What's very interesting, Zack, related to this conversation or a question you posed is that the evaluation period itself is running at about the same pace that we'd seen historically, the amount of time and energy that's being invested, which really much slower is the approval time period. Once you get selected, you give evidence of selection and you start working on contracts and then getting through that approval cycle and going from budget to funding is really -- got much longer.

札克，​​與這次談話或你提出的問題相關的非常有趣的是，評估期本身的運行速度與我們歷史上所見的大致相同，投入的時間和精力也與批准時間相比要慢得多。一旦你被選中，你就要提供被選中的證據，然後開始簽訂合同，然後經歷審批週期，從預算到資金的整個過程實際上要長得多。

So that's the part of the sales cycle that we see gotten much more difficult. So probably a longer answer than you were anticipating, Zach, but I think it hopefully out of provides a little clarity on what we're seeing in the marketplace right now.

所以，我們發現銷售週期的這一部分變得更加困難。因此，扎克，我的回答可能比你預期的要長，但我希望它能讓我們更清楚地了解目前市場上的情況。

Yes, absolutely. I always appreciate the incremental color. And Allan, the follow-up question I had was around the conversion activity within your on-premise customer base. A little bit of a shift to what we've seen in the past where it seems like you could have drawn a line in the sand to use the phrase to really accelerate some of that conversion activity moving forward. So just curious if you had any feedback from customers since kind of giving that notice and what's your expectation in terms of really starting to move people over to the cloud side of the business?

是的，絕對是。我總是欣賞增量色彩。艾倫，我的後續問題是關於您的內部客戶群中的轉換活動。與我們過去所見的情況相比，情況略有轉變，似乎你可以劃一條界線來使用這個短語來真正加速一些轉換活動的推進。所以我很好奇，自從發出通知以來，您是否收到過客戶的回饋，以及您對真正開始將人們轉移到雲端業務的期望是什麼？

It's been mixed feedback from the rationale behind it was really multifold. First and foremost, it's just become far more difficult for us to deliver on on-prem, given that all of our development and the depth of development is really hinged around being in the cloud. So we've decided that didn't make sense. We've also seen as we've all experienced in the world today the cyber risks have gotten on higher. So many of our clients have been very receptive to it.

對此的回饋褒貶不一，背後的原因確實是多方面的。首先，鑑於我們所有的開發和開發深度實際上都圍繞著雲端，因此我們在本地交付變得更加困難。所以我們認為這沒有意義。我們也看到，正如我們在當今世界所經歷的那樣，網路風險已經變得越來越高。我們的許多客戶對此都非常接受。

In some cases, the fit they were pleased that we actually delivered the message because it gave them one more incentive behind the momentum to move to the cloud. They're anxious about being able to protect their data and their systems and make them available on their own environment. They're much more comfortable that we and our partners are able to do that in a more effective way. So that's been encouraging.

在某些情況下，他們很高興我們確實傳達了訊息，因為這為他們遷移到雲端提供了更多的動力。他們急於能夠保護自己的資料和系統並使其在自己的環境中可用。他們對我們和我們的合作夥伴能夠以更有效的方式做到這一點感到更加放心。這令人鼓舞。

And then those who on the other side of the spectrum were frustrated by it, we've continued to dialogue with them and share with them that we're not abandoning them. We're just not going to be able to deliver any new functionality, and we're going to help them through that process. So after the initial shock and maybe a bit of an overreaction the reality of we have ample time to get them to a cloud in a comfortable way and facilitate getting budgets in place and adequate time to actually do the transformation project and move it over without putting risk on their supply chain. They've gotten more comfortable with the certain circumstances.

然後，對於那些對此感到沮喪的人，我們會繼續與他們對話，並告訴他們我們不會拋棄他們。我們只是無法提供任何新功能，但我們將幫助他們完成這一過程。因此，在最初的震驚和可能有點過度反應之後，現實是我們有充足的時間讓他們以舒適的方式進入雲端，並促進預算到位，並有足夠的時間來實際完成轉型項目並將其轉移，而不會給他們的供應鏈帶來風險。他們已經對某些情況變得更加適應了。

So that it takes a little more conversation with those who initially react negatively. But some of we haven't had anybody that ran away yelling and screaming. And I think that's been probably also a strong reference to that. That's just the reality in the market today.

因此，我們需要與那些最初反應消極的人進行更多的對話。但我們中的一些人還沒有看到有人大喊大叫地逃跑。我認為這也可能對此有強而有力的參考。這就是當今市場的現實。

So understood. And my one final question maybe geared towards events, but can you give us a sense of the baseline assumptions that you're making for your initial recurring revenue guidance for this year? I know it's maybe a little trickier from a revenue recognition standpoint, just given you're accelerating some of the conversions of on-prem customers, but any sort of incremental fee color around that would be greatly appreciated. Thanks.

如此理解。我的最後一個問題可能與事件有關，但您能否讓我們了解您對今年的初始經常性收入指導所做的基準假設？我知道從收入確認的角度來看這可能有點棘手，因為您正在加速一些內部客戶的轉換，但任何形式的增量費用顏色都會受到極大的讚賞。謝謝。

Yes, yes, Zach, you might be thinking that it's a little lower on the lower side. We were trying to be a little conservative because of until we start seeing the close of the deals happening in the first half of the year, we wanted to take a cautious approach to adding incremental bookings to the SaaS. So that's why we've kind of modeled it. So we'd like more of the bookings would be in the second half of the year related to the SaaS area.

是的，是的，扎克，你可能認為它的下側稍微低一點。我們試圖採取一些保守的態度，因為直到我們開始看到上半年交易的結束，我們才希望採取謹慎的方式來增加 SaaS 的增量預訂量。這就是我們對其進行建模的原因。因此，我們希望下半年有更多與 SaaS 領域相關的預訂。

Got it. Understandable. Thanks for taking -- yeah.

知道了。可以理解。感謝您的接受－是的。

Yes, I was just going to say the revenue is tied to the bookings in the contract start date. So as you move the bookings out to the back end of the year, we just have less time to capture the revenue and really having a reflection in the in the revenue number associated with the financial results.

是的，我只是想說收入與合約開始日期的預訂量掛鉤。因此，當您將預訂移至年底時，我們就沒有太多時間來獲取收入，也無法真正反映與財務結果相關的收入數字。

Makes sense. Well thanks for taking my questions and best of luck with the rest of the quarter.

有道理。好的，感謝您回答我的問題，並祝您本季剩餘時間一切順利。

Matthew Galinko.

馬修·加林科。

Hi, thanks for taking my questions. I was hoping maybe you could give us a little bit more color around the tone or what you see as the cause of the on the headwinds that are kind of prolonging the approval cycle? Is it the fact that the customers are expecting interest rates to come down and didn't, but they'll sort of reset expectations and kind of operate in a higher rate environment and move forward or is it something where we need to expect rates to come down before real forward progress happens.

你好，謝謝你回答我的問題。我希望您能給我們多一點解釋，或者您認為導致審批週期延長的阻力的原因是什麼？事實是，客戶預期利率會下降，但事實並非如此，但他們會重新設定預期，在更高的利率環境中運作並向前發展，還是我們需要預期利率下降，然後才能實現真正的向前發展。

First of all, Matthew, thank you for joining us, and thanks for the question. It's a good one to explore a bit here. Our client community is primarily in the consumer goods space. Many of those clients are in an environment where their products are not staple goods. So their subjective. The consumer doesn't necessarily have to spend money on those things. Although we also have a very good community of clients in the staple goods, and that's where we're seeing the energy that's going forward.

首先，馬修，感謝您加入我們，也感謝您提出這個問題。在這裡進行一些探索是很好的。我們的客戶群主要集中在消費品領域。許多客戶所處的環境使其產品不再是主食。所以他們的主觀。消費者不一定要花錢買這些東西。儘管我們在主食領域也擁有非常好的客戶群，但我們也從中看到了未來的發展活力。

Staple goods are still strong. We all still have to eat some. We all still have to have some level of clothing. We know there's some of those things that are just strong in the marketplace and those are the clients that are investing. Discretionary spending is that well, obviously, and those are the clients that are really suffering the most. And I don't anticipate really -- or we're not seeing that the interest rates are a direct impact on our clients' business, but more a reflection of the impact on what's going on in their sales and their revenue impact that they're having.

主食依然堅挺。我們都還得吃點兒。我們仍然需要有一定的衣服。我們知道，有些東西在市場上表現強勁，而這些就是客戶投資的。顯然，可自由支配的開支就是這些，而這些客戶才是真正受害最深的客戶。我並不真的預期——或者說我們沒有看到利率對客戶的業務產生直接影響，而是更多地反映了利率對其銷售情況和收入的影響。

They're seeing some bloated inventories in the channel. So the flow of inventories has been kind of backlogged as they as they brought inventory in back into the channel based on coming off the back end of the pandemic. And then all the sudden slowed sales started to slow. So they're anxious their anxious about what the interest rates will do to the consumer and what that will have an impact on consumer spending. And as you look under the covers that much of the economic news, we can actually see the same things that they're experiencing.

他們發現渠道中存在一些庫存膨脹的情況。因此，隨著疫情結束後他們將庫存重新帶回渠道，庫存流一直處於積壓狀態。然後，銷售突然開始放緩。因此，他們擔心利率會對消費者產生什麼影響，以及會對消費者支出產生什麼影響。當你仔細查看大量經濟新聞時，我們實際上可以看到他們正在經歷的相同的事情。

As a result of that, they're also welcome cutting staff on their side. So cutting staff -- they're a little anxious about making investments and gaming kicking off projects when they're limited staffing levels. They're kind of just staying the course right now to see what happens. So that's really what we're hearing from them. However, they know that they need to invest. They know that the pace of the market is out moving their ability to operate a supply chain in the old traditional ways. They're excited about the new capabilities that we can help them with and help them accelerate the decision-making, help them take down the barriers to making decisions more quickly and more effectively.

因此，他們也樂意裁減員工。因此，在裁員時——由於人員配備有限，他們對投資和啟動遊戲項目有點焦慮。他們現在只是堅持現狀，看看會發生什麼。這就是我們從他們那裡聽到的真相。然而，他們知道他們需要投資。他們知道，市場的發展步伐已經超出了他們以傳統方式運作供應鏈的能力。他們對我們可以幫助他們的新功能感到興奮，這些新功能可以幫助他們加快決策速度，幫助他們消除更快、更有效地做出決策的障礙。

But the CFO's got a big desk and short arms. Just won't reach out there and sign the capital expenditure document and release the funds to let them get going so. Actually that's kind of what we're seeing in the marketplace. That's why we also think -- because they've done the evaluations, they readied the project, they know what they need to do, we think if we can get a break in this macro economic conditions, we might see a rather rapid acceleration in projects.

但財務長的辦公桌很大，但手臂卻很短。只是不會聯繫他們並簽署資本支出文件並發放資金讓他們開始行動。事實上，這就是我們在市場上看到的。這就是為什麼我們也認為——因為他們已經完成了評估，他們準備好了項目，他們知道他們需要做什麼，我們認為如果我們能夠在這種宏觀經濟條件下取得突破，我們可能會看到項目相當快速的加速。

That's great color. And I guess my follow up, relatively related, but the and I think you outlined three pockets of demand, primarily the cloud conversions and kind of new logos -- within the cloud conversion group of potential deals, are those also under the same intense scrutiny as -- has sort of new logos or new functionality? Or are they a little bit more amenable to shifting if they're already under maintenance contract. Can you help me understand a little bit if there's relative differences between those groups of products -- prospective and existing customers?

顏色真棒。我想我的後續問題相對相關，但我認為您概述了三個需求領域，主要是雲端轉換和新標誌 - 在雲端轉換潛在交易組中，這些是否也受到同樣嚴格的審查 - 是否有新識別或新功能？或者如果他們已經簽訂了維護合同，他們是否更願意接受轉變。您能否幫助我了解這些產品組（潛在客戶和現有客戶）之間是否存在相對差異？

Yes, great. Great perspective on that. One the they are easier to get moving. However, they as Vince pointed out, there is an investment that needs to be made. There is typically an offset of investment.

是的，太棒了。對此有很好的看法。它們更容易動起來。然而，正如文斯所指出的那樣，需要進行投資。通常存在投資抵消的情況。

So what also makes it easier. But from our perspective, we see, as Vince said, somewhere between two to three and oftentimes even greater uplift over the current spend they're making with us. When they can offset that spend internally, it becomes quite easy because now they get security, new functionality, enhanced capabilities, and they can stay current and they can get a safer environment from a cyber risk standpoint and offsetting expenses.

那麼什麼讓它變得更容易呢？但從我們的角度來看，正如文斯所說，我們看到的增幅在他們目前與我們一起花費的金額之上，增幅在兩到三倍之間，而且通常還會更大。當他們能夠在內部抵消這些支出時，事情就會變得相當容易，因為現在他們獲得了安全性、新功能、增強的能力，他們可以保持最新狀態，並且可以從網路風險的角度獲得更安全的環境並抵消開支。

Now with that said, they still have to get it is still a project that requires cash flow and that sort of thing. So there's some work to be done there. It's not it's not easy, but it's a whole lot easier than say, we're just going to scrap everything we're doing today and start over. Because that's an easy one to offset a bit and say, can't we just stay with what we got? Do we have to really spend the money today?

話雖如此，他們仍然必須明白這仍然是一個需要現金流之類的項目。因此，還有一些工作要做。這並不容易，但比說「我們只是要放棄今天所做的一切並重新開始」要容易得多。因為這很容易抵消一點，並且說，我們不能只保持我們所擁有的嗎？我們今天真的要把這筆錢花掉嗎？

Can we wait for a couple of months? Whereas these lift and shifts are a little easier to get through. Overall expenditures a little bit lower as well. I mean, they're not as big as a bit of a larger transformation project and those large -- larger the project, the more eyes and hands that get touched on it to get it approved. So on our we're counting on that -- continuing to accelerate for us in the new fiscal year and will make up a pretty immaterial portion of our anticipated bookings.

我們可以等幾個月嗎？而這些提升和轉變則更容易實現。整體支出也略低一些。我的意思是，它們不像大型轉型專案那麼大，而且專案越大，需要越多的人來關注和處理，才能獲得批准。因此，我們指望這一點——在新的財政年度繼續加速發展，並將占我們預期預訂量的相當重要的一部分。

Anja Soderstro.

安雅·索德斯特羅。

Thank you for taking my questions and a follow-up on the -- we were expecting them bookings to be back-end loaded in the second half. So that should be pretty impactful for fiscal 2026 then in terms of account revenue?

感謝您回答我的問題並進行跟進——我們預計他們的預訂將在下半年後端加載。那麼，就帳戶收入而言，這對 2026 財年應該會有很大的影響力嗎？

Yes, absolutely. Anja, thank you for joining us. Yes, in fact, that is exactly the point. As we see the end of the calendar year is typically good for us, that could stimulate a little bit of demand. But often even then someone that signs in the beginning of end of November, beginning of December, usually the first thing they say is and we'll get started after the holidays. So that usually causes a month or two delay.

是的，絕對是。Anja，感謝您加入我們。是的，事實上，這正是重點。我們看到，日曆年末通常對我們來說是好事，這可能會刺激一點需求。但通常即使是在 11 月底或 12 月初簽約的人，通常他們說的第一件事就是我們將在假期後開始工作。所以這通常會導致一到兩個月的延遲。

So even at that level we get -- we pick up maybe two, three months worth of revenue on those bookings. But anything you sign in January, February, March and April -- April is basically you get nothing. It's fiscal 2026, March, you might get a month or so. So it's just the beginnings of it. But yes, it cascades immediately then into fiscal 2026. We're anticipating a bigger uplift into the back-end.

因此，即使在這個水平上，我們也可以從這些預訂中獲得相當於兩到三個月的收入。但是，如果您在一月、二月、三月和四月簽署任何協議——四月基本上您將一無所獲。現在是 2026 財年，三月，你可能會有一個月左右的時間。所以這只是個開始。但是的，它會立即影響到 2026 財年。我們期待後端有更大的提升。

And then in terms of the pipeline, is the conversion of -- below the historical levels, but it's been improving. And do you have any sort of numbers around that to what magnitude it's been below historical levels and how it's been improving?

就管道而言，轉換率低於歷史水平，但一直在改善。您是否有相關數據可以說明它與歷史水平相比下降了多少，以及它是如何改善的？

Yes, we have some we're seeing we're continuing to see double digit growth in our overall pipeline, the conversion rates of the troubled part of that, but it's pent-up demand. So again, if we can see a breakthrough in the economic conditions, we think that we're open to see -- that we can burn through the growth in our pipeline and converted to revenue and have to work really hard to keep continue to build pipeline, which we do every day anyway. But, yes, the pipeline growth is really exciting. We need to breakthrough in the conversions.

是的，我們看到我們的整體管道繼續保持兩位數的成長，雖然其中存在問題的部分的轉換率有所提高，但這是被壓抑的需求。因此，如果我們能夠看到經濟狀況的突破，我們認為我們願意看到——我們可以透過管道成長來消耗並轉化為收入，並且必須非常努力地繼續建造管道，無論如何，我們每天都在這樣做。但是，管道的成長確實令人興奮。我們需要在轉變上取得突破。

And then also curious about the rebranding. What's been driving that and your thoughts around that?

並且對品牌重塑也感到好奇。是什麼推動了這現象？您對此有何看法？

Yes, we had that in mind for some time, and we were looking for the right trigger point. Earlier in the year in fiscal 2024, we made the commitment to divest the non-strategic assets, and which carries with it a lot of work. And now with the recapitalization under the share structure that made sense and it's going to be time.

是的，我們考慮這個問題已經有一段時間了，我們正在尋找正確的觸發點。早在2024財年，我們就承諾剝離非策略性資產，這項工作需要大量工作。現在，股權結構下的資本重組已經變得合理，是時候了。

We reserve the new ticker symbol. We've got the registration ready and we're good to go. We're waiting for that final approval. We'll get a few of these this paperwork behind us. But primarily the motivation behind it is the fact that as it -- from an investment community were known as American Software.

我們保留新的股票代碼。我們已經準備好註冊，可以出發了。我們正在等待最終批准。我們會把其中一些文書工作處理完畢。但背後最主要的動機是，從投資界來看，它被稱為美國軟體。

From a business community from the solutions, we do the brand we put out there were known as Logility and the clients ask, who's American Software in the investment community said what's Logility. So we figured it's time to just dispense with that and be one. And the most logical approach is to align the company with the brand as opposed to trying to rebrand it aligned to us the parent company, the registered company.

從商業社群的解決方案來看，我們推出的品牌稱為 Logility，客戶會問，投資界的 American Software 是誰，他們說 Logility 是什麼。因此我們認為現在是時候放棄這一點並成為一個整體了。最合理的方法是使公司與品牌保持一致，而不是試圖將其重新命名為與母公司（註冊公司）保持一致。

So that's the motivation. We're well known in the industry. Logility brand is very well known in the industry. So there's a whole lot less work if we follow the path we're on, and we're quite excited about that, just bringing that clarity to the table.

這就是動機。我們在業界很有名氣。Logility品牌在業界非常知名。因此，如果我們按照現在的路徑走，工作量就會少很多，我們對此感到非常興奮，只是想把這種清晰的思路帶到談判桌上。

Thank you. And in terms of that elimination of [dual class stock] and how is that perceived by the investors? Do you think that's going to be sort of big hurdle for them currently and that you're going to see a lot more interest now?

謝謝。那麼，就取消雙重股權結構而言，投資人如何看待這一點？您認為這對他們來說會是一個很大的障礙嗎？現在您會看到更多的興趣嗎？

Well, a lot of them are with us on the call this afternoon. So we'll see what they have to say. But generally, we've been chatting about this for a while and when the day will be right. So the expectation is it is right. It is the right thing to do. It gives us even representation across the entire investment community, which is always a positive thing. It also opens up the window -- maybe it's well known, maybe not completely well known.

嗯，今天下午很多人都跟我們一起參加了電話會議。所以我們會看看他們會說什麼。但總的來說，我們已經討論了一段時間了，並討論什麼時候才是合適的日期。所以期望是正確的。這是正確的做法。它使我們在整個投資界具有平等的代表性，這始終是一件積極的事情。它也打開了一扇窗戶——也許它是眾所周知的，也許不是完全眾所周知的。

There's a lot of investors who just -- their charter doesn't -- forbids them for making investments in growth companies that are -- have a dual-class structure. So we think it will open up the company to an even broader investment community, which is always good for the current investors as well. So we're quite excited about that transition. The work is all done. What we're really into now -- we'll be making some filings in preparation for the shareholder meeting, which happens in August.

有許多投資者，他們的章程並沒有禁止他們投資具有雙重股權結構的成長型公司。因此我們認為這將使公司向更廣泛的投資群體開放，這對現有投資者來說也是一件好事。所以我們對這一轉變感到非常興奮。工作全部完成了。我們現在真正要做的事情是——我們將為 8 月舉行的股東大會準備一些文件。

And we'll be asking for all the shareholders to either support us on that through their vote or for express their desire elsewise. But we are firmly believing that will be a positive reception and it will wrap this up in the month of August.

我們希望所有股東透過投票支持我們，或表達他們的其他願望。但我們堅信這將是一次正面的反響，並將在八月結束。

Okay great. That was all for me. Thanks.

好的，太好了。對我來說這就是全部了。謝謝。

Excellent. Thank you, Anja. Thanks for joining us.

出色的。謝謝你，安雅。感謝您的加入。

We have no further questions at this time.

目前我們沒有其他問題。

Well, Travis, thank you so much for helping us with the call today. Thank you all for participating, once again. We certainly appreciate your attention and -- late in the day, and we'll look forward to speaking to all of you at the next quarter end, if not sooner. Have a good afternoon.

好吧，特拉維斯，非常感謝您今天幫助我們打電話。再次感謝大家的參與。我們非常感謝您的關注——雖然時間已經很晚了，但我們期待在下個季度末（如果不是更早的話）與大家交談。祝您下午愉快。

This does conclude today's program. Thank you for your participation. You may disconnect at any time.

今天的節目到此結束。感謝您的參與。您可以隨時斷開連線。