OneSpan Inc (OSPN) 2024 Q3 法說會逐字稿

Good day, and thank you for standing by. Welcome to the OneSpan Q3 2024 earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded.

美好的一天，感謝您的支持。歡迎參加 OneSpan 2024 年第三季財報電話會議。（操作員指示）請注意，今天的會議正在錄製中。

I would now like to hand the conference over to your first speaker today, Joe Maxa, Vice President of Investor Relations. Please go ahead.

現在我想將會議交給今天的第一位發言人，投資者關係副總裁 Joe Maxa。請繼續。

Thank you, operator. Good afternoon, everyone, and welcome to the OneSpan third-quarter 2024 earnings conference call. This call is being webcast and can be accessed on the Investor Relations section of OneSpan's website at investors.onespan.com. Joining me on the call today is Victor Limongelli, our Chief Executive Officer; and Jorge Martell, our Chief Financial Officer. This afternoon, after market closed, OneSpan issued a press release announcing results for our third quarter 2024.

謝謝你，接線生。大家下午好，歡迎參加 OneSpan 2024 年第三季財報電話會議。本次電話會議正在網路上直播，您可以透過 OneSpan 網站 Investors 關係部分的 Investors.onespan.com 觀看。今天和我一起參加電話會議的是我們的執行長 Victor Limongelli；和豪爾赫·馬爹利，我們的財務長。今天下午收盤後，OneSpan 發布新聞稿，宣布 2024 年第三季業績。

To access a copy of the press release and other investor information, please visit our website. Following our prepared comments, we will open the call for questions. Please note that statements made during this conference call that relate to future plans, events or performance, including the outlook for full year 2024 and other long-term financial targets are forward-looking statements. These statements involve risks and uncertainties and are based on current assumptions. Consequently, actual results could differ materially from the expectations expressed in these forward-looking statements.

要獲取新聞稿副本和其他投資者信息，請訪問我們的網站。根據我們準備好的評論，我們將開始提問。請注意，本次電話會議期間發表的與未來計畫、事件或業績相關的聲明，包括 2024 年全年展望和其他長期財務目標，均為前瞻性聲明。這些陳述涉及風險和不確定性，並且基於當前的假設。因此，實際結果可能與這些前瞻性陳述中所表達的預期有重大差異。

I direct your attention to today's press release and the company's filings with the U.S. Securities and Exchange Commission for a discussion of such risks and uncertainties. Also note that certain financial measures that may be discussed on this call are expressed on a non-GAAP basis and have been adjusted from a related GAAP financial measure. We have provided an explanation for and reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures in the earnings press release and in the earnings presentation available on our website. In addition, please note that all growth rates discussed on this call refer to a year-over-year basis unless otherwise indicated.

請您注意今天的新聞稿以及該公司向美國證券交易委員會提交的文件，以討論此類風險和不確定性。另請注意，本次電話會議可能討論的某些財務指標是在非公認會計原則基礎上表示的，並已根據相關的公認會計原則財務指標進行了調整。我們在收益新聞稿和我們網站上的收益演示中提供了這些非公認會計原則財務指標與最直接可比較的公認會計原則財務指標的解釋和調節。此外，請注意，除非另有說明，本次電話會議中討論的所有成長率均指同比成長率。

The date of this conference call is October 30, 2024. Any forward-looking statements and related assumptions are made as of this date. Except as required by law, we undertake no obligation to update these statements as a result of new information or future events or for any other reason. I will now hand the call over to Victor.

本次電話會議的日期為 2024 年 10 月 30 日。任何前瞻性陳述和相關假設均截至該日期。除法律要求外，我們不承擔因新資訊或未來事件或任何其他原因而更新這些聲明的義務。我現在將電話轉交給維克多。

Thank you, Joe. Hello, everyone. Thank you for joining us on the call today. I'm thrilled we reported another solid profitable quarter, driven by the team's hard work and focus on operational excellence. Adjusted EBITDA was $17 million or 30% of revenue, and both business units were profitable.

謝謝你，喬。大家好。感謝您今天加入我們的電話會議。我很高興在團隊的辛勤工作和對卓越營運的關注的推動下，我們又報告了一個穩定的獲利季度。調整後 EBITDA 為 1,700 萬美元，佔營收的 30%，兩個業務部門皆可獲利。

I am particularly pleased that our digital agreements segment for the first time was profitable on a fully burdened basis, that is including corporate allocations, and that our Security segment continued to be highly profitable. We had strong double-digit subscription revenue growth in the third quarter. Subscription revenue grew 29% and accounted for 60% of total revenue. Total software and services revenue grew 10% and accounted for 78% of revenue. Overall, revenue declined 4%, primarily due to the anticipated decline in hardware that we discussed on last quarter's call.

我特別高興的是，我們的數位協議部門首次在完全負擔的基礎上實現盈利，其中包括公司分配，並且我們的安全部門繼續保持高利潤。第三季我們的訂閱營收實現了兩位數的強勁成長。訂閱收入成長29%，佔總收入的60%。軟體和服務總收入成長10%，佔營收的78%。總體而言，收入下降了 4%，主要是由於我們在上個季度電話會議上討論的硬體預期下降。

ARR grew 9%, in line with the approximate 7% to 10% guidance range implied by our full year ARR guidance of $166 million to $170 million. As a reminder, we saw ARR growth of 15% last quarter, driven in part by a few large deals that closed earlier than expected. Q3 ARR was impacted sequentially by approximately $2 million from products we previously sunsetted. We believe we are on track to achieve our full year 2024 ARR guidance range. I want to remind everyone that the products we sunsetted, though they contributed some revenue and ARR, and therefore, have some associated top line and ARR headwinds, were low growth and low return on investment products.

ARR 成長了 9%，與我們全年 ARR 指引值 1.66 億至 1.7 億美元所暗示的大約 7% 至 10% 的指導範圍一致。提醒一下，我們看到上季 ARR 成長了 15%，部分原因是一些比預期提前結束的大型交易。第三季 ARR 受到我們先前停用的產品約 200 萬美元的影響。我們相信，我們有望實現 2024 年全年 ARR 指導範圍。我想提醒大家，我們淘汰的產品雖然貢獻了一些收入和ARR，因此存在一些相關的營收和ARR逆風，但它們是低成長和低投資回報率的產品。

We are already benefiting from increased operating efficiencies and profitability from the sunsetting of these products and believe we are better positioned from a product portfolio perspective to drive increased profitable growth in the coming years. We continue to generate strong cash. We generated $14 million in cash from operations in the third quarter and $43 million year to date, which is a significant improvement from the prior year. Last year, we used $7 million in cash during the third quarter and $14 million in cash through the first nine months. As of September 30, we had $77 million in cash on hand.

我們已經受益於這些產品的淘汰所帶來的營運效率和獲利能力的提高，並且相信從產品組合的角度來看，我們能夠更好地推動未來幾年的獲利成長。我們繼續產生強勁的現金。我們第三季的營運現金為 1,400 萬美元，今年迄今為 4,300 萬美元，比上年有顯著改善。去年，我們在第三季使用了 700 萬美元現金，在前 9 個月使用了 1,400 萬美元現金。截至 9 月 30 日，我們手頭上有 7,700 萬美元現金。

And we continue to focus on operational excellence and accountability throughout the company. For example, our sales team continues to focus on transitioning the company to more higher-margin software revenue, and they've been working hard to stay close to customers so that we can continue to improve our performance in response to customer feedback.

我們繼續關注整個公司的卓越營運和問責制。例如，我們的銷售團隊繼續專注於將公司轉向更高利潤的軟體收入，他們一直在努力與客戶保持密切聯繫，以便我們能夠根據客戶的回饋繼續提高我們的績效。

Our renewals team continues to make strides in closing maintenance renewals in a timely fashion. Year to date, our on-time renewal rate improved several percentage points compared to 2023. And our R&D team is continuing to make improvements to our SaaS offerings, which we are starting to see through increased operational efficiencies reflected in higher gross margins.

我們的續訂團隊在及時完成維護續訂方面繼續取得進展。今年迄今為止，我們的按時續訂率比 2023 年提高了幾個百分點。我們的研發團隊正在繼續改進我們的 SaaS 產品，我們開始看到營運效率的提高反映在更高的毛利率上。

Turning to our two business units. I'm, of course, thrilled with the profitability delivered by both BUs in the third quarter. In digital agreements, revenue and ARR growth was driven by expansion contracts and to a lesser extent new logos. In terms of the seasonality of bookings, we expect Q4 to be stronger than Q3, as it typically is. This will help our end of year ARR, but will have limited impact on Q4 revenue.

轉向我們的兩個業務部門。當然，我對兩個業務部門在第三季實現的獲利能力感到非常興奮。在數位協議中，收入和 ARR 的成長是由擴展合約以及較小程度的新標誌推動的。就預訂的季節性而言，我們預計第四季度將強於第三季度，就像通常情況一樣。這將有助於我們年末的 ARR，但對第四季度收入的影響有限。

In our security business unit, our Q3 subscription revenue and ARR growth was primarily driven by authentication solutions for existing customers. In Q4, we expect another quarter of double-digit subscription revenue growth. However, like last quarter, given our visibility into our hardware pipeline and anticipated customer delivery schedules, we anticipate a decline in hardware and total security revenue as compared to the fourth quarter of last year.

在我們的安全業務部門，我們第三季的訂閱收入和 ARR 成長主要是由現有客戶的身份驗證解決方案所推動的。在第四季度，我們預計訂閱收入將再次實現兩位數成長。然而，與上個季度一樣，鑑於我們對硬體管道和預期客戶交付時間表的了解，我們預計硬體和整體安全收入將與去年第四季相比將下降。

Over time, a number of banks in EMEA and to a lesser extent in Asia Pacific have adopted mobile-first policies with respect to consumer banking. Looking ahead, although we are not ready to provide fiscal year '25 guidance, our initial view for next year suggests hardware revenues will continue to decline modestly year-over-year.

隨著時間的推移，歐洲、中東和非洲地區以及亞太地區（較小程度上）的許多銀行都在消費銀行業務方面採取了行動優先政策。展望未來，儘管我們尚未準備好提供 25 財年的指導，但我們對明年的初步看法表明硬體收入將繼續同比小幅下降。

Our goal is to have both business units deliver growth and strong profitability, and we are well on our way to achieving that goal. Security growth may be more challenging in the near term given the context I just provided around hardware, but I believe we are in a strong position long-term to drive increased growth and profitability as we focus on driving higher-margin software revenues.

我們的目標是讓兩個業務部門實現成長和強勁的獲利能力，我們正在努力實現這一目標。考慮到我剛剛提供的有關硬體的背景，安全成長在短期內可能更具挑戰性，但我相信，隨著我們專注於推動更高利潤的軟體收入，我們在長期推動成長和盈利能力方面處於有利地位。

For the full year 2024, given the dramatic strides we have made in terms of profitability, we expect our adjusted EBITDA to be significantly higher than previously forecast. In addition, we continue to expect strong double-digit growth in subscription revenue. However, given our increased visibility into hardware, we now expect our full year revenue to fall in the lower half of our prior revenue guidance range.

對於 2024 年全年，鑑於我們在獲利能力方面取得的巨大進步，我們預計調整後的 EBITDA 將顯著高於先前的預測。此外，我們繼續預期訂閱收入將出現兩位數的強勁成長。然而，鑑於我們對硬體的了解不斷增加，我們現在預計全年收入將下降到先前收入指導範圍的下半部分。

Finally, as I noted last quarter, the Board plans to undertake by year-end a review of our cash generation and capital needs, balancing those factors with a desire to return capital to shareholders.

最後，正如我上季度指出的那樣，董事會計劃在年底前對我們的現金產生和資本需求進行審查，以平衡這些因素與向股東返還資本的願望。

With that, I will turn the call over to Jorge. Jorge?

這樣，我會將電話轉給豪爾赫。豪爾赫？

Thank you, Victor, and good afternoon, everyone. Before reviewing our financial results, I want to highlight the substantial completion during the third quarter of our multiyear cost reduction initiatives. I'm very pleased with the team's efforts as we worked to capture significant cost savings over the last couple of years, which has helped us meaningfully improve our operating profitability.

謝謝你，維克多，大家下午好。在回顧我們的財務表現之前，我想強調我們的多年成本削減計劃在第三季的實質完成。我對團隊的努力感到非常滿意，因為我們在過去幾年中努力實現了顯著的成本節約，這幫助我們顯著提高了營運獲利能力。

During the third quarter, we realized $3 million in annualized cost savings, bringing our cumulative annualized cost savings to $18 million year to date and to approximately $76.5 million dating back to May of 2022, exceeding our year-end 2024 cumulative annualized cost savings goal of $75 million.

第三季度，我們實現了300 萬美元的年化成本節省，使年初至今的累計年化成本節省達到1800 萬美元，自2022 年5 月以來累計年化成本節省約為7650 萬美元，超過了我們2024 年底的累計年化成本節省目標7,500 萬美元。

Now, turning to our third quarter results.

現在，轉向我們的第三季業績。

ARR grew 9% to $164 million and our net retention rate was 106%. As compared to last year, ARR and NRR primarily benefited from customer expansion contracts and ARR to a lesser extent also benefited from new customers. Growth in ARR and NRR was partially offset by an increase in typical churn and churn related to end-of-life products. Third quarter 2024 revenue was $56.2 million, 4% lower than last year's Q3, primarily due to the expected decline in hardware revenue. Digital agreements revenue grew 18% and was offset by a decline in security revenue of 11%.

ARR 成長 9%，達到 1.64 億美元，淨留存率為 106%。與去年相比，ARR 和 NRR 主要受益於客戶拓展合同，ARR 在較小程度上也受益於新客戶。ARR 和 NRR 的成長被典型流失率和與報廢產品相關的流失率的增加部分抵消。2024 年第三季營收為 5,620 萬美元，比去年第三季下降 4%，主要是由於硬體收入的預期下降。數位協議收入成長 18%，但被安全收入下降 11% 所抵消。

Within our security business unit, software and services grew 6%. Subscription revenue grew 29% to $33.6 million, including 29% growth in security solutions and 27% growth in digital agreements. Maintenance revenue declined by design as we continued to transition to a SaaS and subscription license model. Third quarter gross margin was 73.9% compared to 69.1% in the prior year quarter.

在我們的安全業務部門內，軟體和服務成長了 6%。訂閱收入成長 29%，達到 3,360 萬美元，其中安全解決方案成長 29%，數位協定成長 27%。隨著我們繼續向 SaaS 和訂閱授權模式轉型，維護收入自然會下降。第三季毛利率為 73.9%，去年同期為 69.1%。

The increase in gross margin was primarily driven by favorable product mix within our security segment, including an increase in software and a decrease in hardware, partially offset by an increase in depreciation of capitalized software costs in digital agreements.

毛利率的成長主要是由於我們安全領域內有利的產品組合推動的，包括軟體的增加和硬體的減少，部分被數位協定中資本化軟體成本折舊的增加所抵消。

Third quarter GAAP operating income was $11.3 million compared to an operating loss of $4.8 million in the third quarter of last year. The year-over-year improvement was primarily driven by an increase in gross profit dollars due to the favorable product mix just discussed, a decrease in operating expenses primarily from lower headcount and vendor-related costs, and lower restructuring costs.

第三季 GAAP 營業收入為 1,130 萬美元，去年第三季營業虧損為 480 萬美元。同比改善主要是由於剛才討論的有利的產品組合導致毛利增加、主要由於員工數量和供應商相關成本減少以及重組成本減少而導致的營運費用減少。

GAAP net income per share was $0.21 in the third quarter of 2024 compared to a GAAP net loss per share of $0.10 in the same period last year. Non-GAAP earnings per share was $0.33 in the third quarter of 2024. This compares to a non-GAAP earnings per share of $0.09 in the third quarter of 2023.

2024 年第三季 GAAP 每股淨利為 0.21 美元，去年同期 GAAP 每股淨虧損為 0.10 美元。2024 年第三季非 GAAP 每股盈餘為 0.33 美元。相比之下，2023 年第三季的非 GAAP 每股收益為 0.09 美元。

Third quarter adjusted EBITDA and adjusted EBITDA margin was $16.7 million and 29.7% compared to $6.3 million and 10.7% in the same period of last year, respectively.

第三季調整後 EBITDA 和調整後 EBITDA 利潤率分別為 1,670 萬美元和 29.7%，而去年同期為 630 萬美元和 10.7%。

Turning to our security solutions business unit. ARR grew 6% in the third quarter to $104 million. ARR growth was negatively impacted by approximately 1.5 percentage points through the relocation of identity verification products to our digital agreements business unit at the beginning of the year. In addition, ARR headwind related to end-of-life products was approximately $1.6 million in the quarter and $2 million year to date.

轉向我們的安全解決方案業務部門。第三季 ARR 成長 6%，達到 1.04 億美元。 ARR由於年初將身分驗證產品轉移到我們的數位協議業務部門，成長受到約 1.5 個百分點的負面影響。此外，本季與報廢產品相關的 ARR 逆風約為 160 萬美元，年初至今約 200 萬美元。

Third-quarter security revenue declined 11% to $40.8 million, primarily due to the expected decrease in hardware revenues we discussed previously. Hardware revenues declined 36% year over year to $12.1 million. Security subscription revenue increased 29% to $18.6 million, primarily driven by expansion of licenses from existing customers for software-based authentication solutions. Maintenance and support revenue declined by design and was in line with our expectations as we continued to transition legacy perpetual maintenance contracts to term licenses.

第三季安全收入下降 11% 至 4,080 萬美元，主要是由於我們先前討論的硬體收入預期下降。硬體營收年減 36% 至 1,210 萬美元。安全訂閱收入成長了 29%，達到 1,860 萬美元，這主要是由於現有客戶對基於軟體的身份驗證解決方案的授權擴展所致。隨著我們繼續將舊的永久維護合約過渡到定期許可證，維護和支援收入按設計有所下降，並且符合我們的預期。

Q3 2024 gross profit margin in our security segment was 75% as compared to 67% in the third quarter of 2023. The increase in margin is primarily attributable to favorable product and customer mix.

2024 年第三季我們安全部門的毛利率為 75%，而 2023 年第三季為 67%。利潤率的增加主要歸因於有利的產品和客戶組合。

Operating income was $20.2 million and operating margin was 49% compared to $15.7 million and 34% in last year's third quarter. The enhancement in gross profit margin combined with reduced operating expenses primarily attributed to restructuring and other cost reduction activities drove the majority of the improved performance.

營業收入為 2,020 萬美元，營業利潤率為 49%，而去年第三季為 1,570 萬美元，營業利潤率為 34%。毛利率的提高，加上主要歸因於重組和其他成本削減活動的營運費用的減少，推動了業績的大部分改善。

Turning to our digital agreements business unit. ARR grew 16% in the third quarter to $60 million.

轉向我們的數位協議業務部門。第三季 ARR 成長 16%，達到 6,000 萬美元。

ARR growth benefited by approximately 3 percentage points due to the relocation of identity verification products to digital agreements at the beginning of the year. ARR headwind related to end-of-life products was less than $0.5 million in the quarter and approximately $3 million year to date.

ARR由於年初身份驗證產品轉向數位協議，成長受益於約 3 個百分點。本季與報廢產品相關的 ARR 逆風不到 50 萬美元，今年迄今約 300 萬美元。

Third quarter revenue grew 18% to $15.4 million, primarily driven by new contracts and expansion of renewal contracts and to a lesser extent, the relocation of identity verification products. Subscription revenue consisting of 100% SaaS revenue grew 27% to $15 million. Third quarter gross profit margin was 72% as compared to 75% in the prior year quarter.

第三季營收成長 18%，達到 1,540 萬美元，這主要是由於新合約和續約合約的擴大以及身分驗證產品的重新部署所推動的。由 100% SaaS 收入組成的訂閱收入成長了 27%，達到 1500 萬美元。第三季毛利率為 72%，去年同期為 75%。

The year-over-year change was primarily driven by an increase in depreciation of capitalized software costs. Operating income was $3.4 million or 22% of revenue as compared to an operating loss of $4.7 million or 36% of revenue in Q3 last year. The significant improvement in performance was driven by an increase in revenue and gross profit dollars, along with a decrease in operating expenses, primarily attributed to restructuring and other cost reduction activities.

年比變化主要是由於資本化軟體成本折舊增加所致。營業收入為 340 萬美元，佔營收的 22%，而去年第三季的營業虧損為 470 萬美元，佔營收的 36%。業績的顯著改善是由於收入和毛利的增加以及營運費用的減少（主要歸因於重組和其他成本削減活動）所推動的。

Now, turning to our balance sheet. We ended the third quarter of 2024 with $77.5 million in cash and cash equivalents compared to $42.5 million at the end of 2023.

現在，轉向我們的資產負債表。截至 2024 年第三季末，我們的現金和現金等價物為 7,750 萬美元，而 2023 年底為 4,250 萬美元。

We generated $14 million in cash from operations during the quarter and used $2 million in capital expenditures, primarily capitalized software costs. We have no long-term debt. Geographically, our revenue mix by region in the third quarter of 2024 was 40% from EMEA, 39% from the Americas and 21% from Asia Pacific. This compares to 45%, 34% and 21% from the same regions in the third quarter of last year, respectively. I will now provide our financial outlook.

本季我們從營運中產生了 1,400 萬美元的現金，並使用了 200 萬美元的資本支出，主要是資本化的軟體成本。我們沒有長期債務。從地理位置來看，我們 2024 年第三季按地區劃分的收入組合為 40% 來自歐洲、中東和非洲、39% 來自美洲、21% 來自亞太地區。相較之下，去年第三季同一地區的比例分別為 45%、34% 和 21%。我現在將提供我們的財務前景。

For the full year 2024, we are narrowing the range of our previously issued revenue guidance to reflect a reduction in anticipated hardware token shipments, partially offset by stronger than previously expected subscription revenues. We are affirming our ARR guidance and we are significantly increasing our adjusted EBITDA guidance to reflect stronger than originally anticipated operating leverage driven by improved execution of our cost savings initiatives.

對於 2024 年全年，我們正在縮小先前發布的收入指引範圍，以反映預期硬體代幣出貨量的減少，但部分被強於先前預期的訂閱收入所抵消。我們確認我們的 ARR 指導，並大幅提高調整後的 EBITDA 指導，以反映由於我們的成本節約計劃的執行改進而導致的營運槓桿比最初預期的更強。

More specifically, we expect revenue to be in the range of $238 million to $242 million as compared to our previous guidance range of $238 million to $246 million. ARR to end the year in the range of $166 million to $170 million and adjusted EBITDA to be in the range of $65 million to $67 million as compared to our previous guidance range of $55 million to $59 million. That concludes my remarks.

更具體地說，我們預計收入將在 2.38 億美元至 2.42 億美元之間，而先前的指導範圍為 2.38 億美元至 2.46 億美元。 ARR到年底，我們的指導範圍為 1.66 億美元至 1.7 億美元，調整後的 EBITDA 為 6,500 萬美元至 6,700 萬美元，而我們先前的指導範圍為 5,500 萬美元至 5,900 萬美元。我的發言到此結束。

Victor?

勝利者？

Thank you, Jorge. I am very proud of the entire OneSpan team. Their hard work and focus on operational rigor over the last several quarters has resulted in a much stronger company. Our ability to generate cash has significantly improved and we are much more profitable as compared to recent years.

謝謝你，豪爾赫。我為整個 OneSpan 團隊感到非常自豪。他們在過去幾個季度的辛勤工作和對嚴格運營的關注使公司變得更加強大。與近年來相比，我們產生現金的能力顯著提高，獲利能力也大大提高。

Looking ahead, we are committed to delivering value to our customers and to returning value to our shareholders by growing revenue efficiently and profitably.

展望未來，我們致力於透過高效率、獲利地增加收入，為客戶創造價值，並為股東回報價值。

Jorge and I will now be happy to take your questions.

豪爾赫和我現在很樂意回答你的問題。

(Operator Instructions) Catharine Trebnick, Rosenblatt Securities.

（操作員指示）Catharine Trebnick，羅森布拉特證券。

So you've talked a lot about focus on execution. Can you give us an update on where you are with your ecosystem and building that out? Because I think that was one of the areas that I thought was interesting when I came back to covering the stock.

所以你已經談論了很多關於專注於執行的問題。您能否向我們介紹一下您的生態系統的最新進展以及建構？因為我認為這是我在回頭關注該股票時認為有趣的領域之一。

Yes, one of the ways we want to grow the business is to extend our reach by working through partners. And we have some progress on that front, but I would say the impact to date is not in the numbers that we reported. It's more in the future than in the past. So we have a direct sales force that can -- when we talk about banks, as an example, we talk about having over 60 of the 100 biggest banks as customers. And other banks of that scale, we deal with our direct sales force.

是的，我們希望發展業務的方式之一就是透過合作夥伴合作來擴大我們的影響力。我們在這方面取得了一些進展，但我想說，迄今為止的影響並不在我們報告的數字中。未來比過去更多。因此，我們擁有一支直接銷售隊伍，可以——以銀行為例，我們談論 100 家最大銀行中的 60 多家作為客戶。與其他同等規模的銀行一樣，我們與直銷人員打交道。

But for us, it's way more efficient to address the midmarket and lower banks through partners. So we've started to sign up partners. We have a new leader of the channel in Europe, and I expect to see that continue to develop as we move into 2025.

但對我們來說，透過合作夥伴來解決中階市場和低端銀行的問題會更有效。所以我們已經開始簽約合作夥伴。我們在歐洲有了一位新的通路領導者，我預計隨著我們進入 2025 年，這一趨勢將繼續發展。

All right. So it's more of a three or four quarter out type of positive impact on revenue?

好的。那麼這更多的是對收入的第三季或第四季的正面影響？

Certainly. So what's going on now is signing up partners, getting them trained, and it takes some time before they're productive and probably even longer for them to materially impact revenue.

當然。因此，現在要做的就是簽約合作夥伴，對他們進行培訓，他們需要一些時間才能發揮生產力，甚至可能需要更長的時間才能對收入產生實質影響。

Trevor Rambo, BTIG.

特雷弗·蘭博，BTIG。

This is Trevor on for Gray Powell. Congrats on some solid results. So to start, how would you guys say the overall macro environment is now compared to about earlier in the year? And I know you touched on it a little bit during the prepared remarks, but could you add some more color on what you're seeing in the hardware business going forward kind of now and into next year? And what you guys are seeing around some customer churn because I know you mentioned that as well in the prepared remarks. That will be great.

我是格雷·鮑威爾的特雷弗。祝賀取得了一些紮實的成果。首先，你們覺得現在的整體宏觀環境與今年稍早相比如何？我知道您在準備好的發言中稍微談到了這一點，但是您能否對您在硬體業務中看到的現在和明年的情況添加更多的色彩？你們在一些客戶流失方面看到了什麼，因為我知道你們在準備好的評論中也提到了這一點。那太好了。

Sure. With respect to hardware, so there's a couple of things going on. In the retail consumer banking segment in Europe and to a lesser extent in Asia Pac, there's definitely more mobile authentication than there was some years ago, and that trend has been going on for a while.

當然。就硬體而言，有一些事情正在發生。在歐洲的零售消費者銀行業務領域，以及在較小程度上在亞太地區，行動身分驗證肯定比幾年前更多，而且這種趨勢已經持續了一段時間。

Less so in corporate banking. Corporate banking still tends to be done in front of a screen, in front of a computer. So it's more amenable to hardware, I think, than consumer banking. So that's been a long-term trend.

企業銀行業務則不然。企業銀行業務仍傾向於在螢幕前、電腦前完成。因此，我認為，它比消費銀行業務更適合硬體。所以這是一個長期趨勢。

And you can see that in -- if you look back over the last decade, you can see that in our hardware numbers. The advantage we have is that if a bank is going to use some hardware, we enable them -- our solution enables them to use the same authentication back-end for both hardware and software. So if they go with OneSpan, they can have one back-end, easy to administer, handle their hardware needs for the customers who want that, handle their mobile authentication needs maybe for the majority of consumers versus going with a competitor and then having to have two different back-ends if they're going to have any hardware at all. So I think there's still some long-term strength in having the hardware offering. It actually helps our software offering, if that makes sense, Trevor.

如果你回顧過去十年，你可以在我們的硬體數據中看到這一點。我們的優勢是，如果銀行要使用某些硬件，我們會啟用它們——我們的解決方案使他們能夠對硬體和軟體使用相同的身份驗證後端。因此，如果他們選擇 OneSpan，他們可以擁有一個易於管理的後端，為需要的客戶處理他們的硬體需求，為大多數消費者處理他們的行動驗證需求，而不是與競爭對手合作，然後不得不如果他們要擁有任何硬件，則有兩個不同的後端。所以我認為擁有硬體產品仍然具有一些長期優勢。它實際上有助於我們的軟體產品，如果這有意義的話，特雷弗。

Yes, that makes sense. Yes, that's some good color. And then maybe just one more. You guys did some nice jobs with the cost-cutting initiatives, both finishing that earlier than you initially expected. And you've been really ramping both operating margins and your adjusted EBITDA throughout the year.

是的，這是有道理的。是的，這是一個很好的顏色。然後也許還有一個。你們在成本削減計劃方面做得很好，而且都比你們最初預期的時間更早完成了。全年營業利潤率和調整後 EBITDA 都在大幅提高。

So I guess moving forward, how are you guys thinking about your ability to both sustain those margins, but also reaccelerate the top line growth as we finish this year and head into next fiscal year?

所以我想，展望未來，你們如何看待自己既能維持這些利潤率，又能在今年結束並進入下一財年時重新加速營收成長的能力？

Yes. Great question. So of course, we want to get to the Rule of 40. And I think we're going to get there through a combination of operating income, operating leverage and some growth. We don't think it makes sense -- we don't think we'll generate as much value by having it all be EBITDA.

是的。很好的問題。當然，我們希望遵循 40 條規則。我認為我們將透過營業收入、營業槓桿和一定成長的結合來實現這一目標。我們認為這沒有意義——我們認為將其全部轉化為 EBITDA 不會產生那麼多價值。

So we are looking at ways to grow faster whether that's through a partner channel, whether it's through new offerings, expansion of our relationships with existing customers. And we haven't given guidance for 2025 and, in fact, haven't finished our budgeting for 2025 yet, but we are definitely looking to grow faster. With respect to the operating income, we certainly don't think we're at a peak there. We think we can do better. But it's fair to say that progress from here on out will be a little bit harder.

因此，我們正在尋找更快成長的方法，無論是透過合作夥伴管道，還是透過新產品、擴大我們與現有客戶的關係。我們還沒有給出 2025 年的指導，事實上，還沒有完成 2025 年的預算，但我們肯定希望能成長得更快。就營業收入而言，我們當然不認為我們正處於巔峰狀態。我們認為我們可以做得更好。但可以公平地說，從現在開始，取得進展將變得更加困難。

So it's one thing to go from negative to upper 20s adjusted EBITDA. We're obviously not going to go from upper 20s to 50s. Like we're not going to make the same jump, but we do think we can make additional progress.

因此，調整後 EBITDA 從負值上升到 20 多歲是一回事。我們顯然不會從 20 多歲到 50 多歲。就像我們不會做出同樣的跳躍一樣，但我們確實認為我們可以取得額外的進展。

Congrats again on a nice quarter.

再次恭喜您度過了一個美好的季度。

Anja Soderstrom, Sidoti.

安雅·索德斯特羅姆，西多蒂。

Congrats on the nice progress here. So the cost cutting, is that coming through faster? Or are you seeing more savings than you initially thought?

祝賀這裡取得的良好進展。那麼成本削減的進度是否更快？或者您看到的節省量是否比您最初想像的要多？

I can jump in here, Vic. So it's a little of both, Anja. So the team executed very well. So we had a plan, particularly for the second and third quarter. Some of those savings came in earlier than we expected.

我可以跳到這裡，維克。所以兩者兼而有之，安雅。所以團隊執行得非常好。所以我們有一個計劃，特別是第二季和第三季的計劃。其中一些節省的時間比我們預期的要早。

And so you see that reflected in the numbers for sure. And then obviously, the adjusted EBITDA guide that we changed favorably. So some of -- and then some of it is also unplanned savings that we identified as you are always trying to identify how do we work smarter, how do we make sure that we can do things more efficiently. So some of these either through vendors or just process improvements that led you to operational efficiencies come to light. And so some of that is on plan.

所以你肯定會看到這一點反映在數字上。顯然，我們對調整後的 EBITDA 指南進行了有利的更改。因此，其中一些——還有一些也是我們確定的計劃外節省，因為您總是試圖確定我們如何更聰明地工作，我們如何確保我們能夠更有效地做事。因此，其中一些可以透過供應商實現，或者只是透過流程改進來提高營運效率。其中一些正在計劃中。

And to a certain extent, also, you may have an idea in terms of like real estate footprint, but some of that comes to fruition into accelerating some of those or increasing some of those savings. So maybe not the nature of it may be new, but in terms of maybe the mix of different vendors that contribute to the savings may be a little bit different than originally planned. So we'll take both of these.

在某種程度上，您也可能對房地產足跡有一個想法，但其中一些想法最終會實現，從而加速其中一些或增加其中一些儲蓄。因此，也許它的本質並不是新的，但就有助於節省成本的不同供應商的組合而言，可能與最初計劃的不同。所以我們將兩者都採用。

Okay. And as we think about that adjusted EBITDA increase and with the hardware becoming a smaller part now, do you expect the gross margin to also be maybe higher and contribute to that EBITDA? Or is it mostly on the operating side?

好的。當我們考慮調整後的 EBITDA 增加以及硬體現在變得更小的部分時，您是否預計毛利率也會更高並為 EBITDA 做出貢獻？還是主要是在營運方面？

You're talking about for 2025?

你說的是2025年嗎？

'24.

'24。

For '24. So maybe to unpack that a little bit. So I think overall, we're going to -- we're increasing that a little bit in terms of our expectation to the low 70s, just like you saw the benefit in Q3. If you look at the two business units, DA -- I guess both DA and security will be in the low 70s. We talked about hardware.

對於'24。所以也許要稍微解開一下。所以我認為總的來說，我們將把我們的預期稍微提高到 70 多歲，就像你在第三季看到的好處一樣。如果你看看兩個業務部門，DA——我猜 DA 和安全部門的水平都將在 70 左右。我們討論了硬體。

Hardware actually is increasing because of the mix of APAC clients that come with a better margin. So that's driving a little bit of an improvement there. So I guess just to answer your question, from the earlier discussion that we had maybe a couple of quarters ago from the high-60s, I think we now can say it's likely going to be in the low-70s. So it's an increase overall.

由於亞太地區客戶的利潤率更高，硬體實際上正在增​​加。所以這推動了那裡的一些改進。所以我想只是為了回答你的問題，從我們幾個季度前可能從 60 多歲開始的早期討論來看，我想我們現在可以說它可能會在 70 多歲以下。所以整體來說是有所增加的。

Okay. And then the jump in the Security Solutions in the subscription, there was a nice jump sequentially. What drove that? And how should we think about that going forward?

好的。然後訂閱中安全解決方案的跳躍，連續出現了很好的跳躍。是什麼推動了這一點？我們該如何思考未來的發展？

Sorry, I missed the first part of the question, Anja, can you repeat that?

抱歉，我錯過了問題的第一部分，Anja，你能再說一次嗎？

The jump, sequentially jump in the subscription for the Security Solutions, what drove that? And how should we think about that going forward?

安全解決方案訂閱量的跳躍式成長，是什麼推動了這個趨勢？我們該如何思考未來的發展？

Yes. No, we continue to see very good progress on the demand side for authentication products, Anja, also mobile application products that we cross-sell to our existing customer base. And so that is primarily what drove that on the subscription revenue. So we're seeing a lot of good adoption, new licenses in particular. Some of those are obviously conversions on the perpetual to term.

是的。不，我們繼續看到認證產品 Anja 以及我們向現有客戶群交叉銷售的行動應用程式產品的需求方面取得了非常好的進展。因此，這主要是推動訂閱收入成長的原因。因此，我們看到了很多良好的採用，特別是新的許可證。其中一些顯然是從永續到期限的轉換。

And so we tend to see price upside to those conversions. So that also benefited the quarter either year over year or sequentially.

因此，我們傾向於看到這些轉換的價格上漲。因此，無論是同比還是環比，這也使該季度受益。

Anja, let me add a comment to that. If you look at 2024, it's the first time that security subscription revenue will exceed hardware revenue. And on top of that, our security BU is just about two-thirds software when you count maintenance and support and subscription. So that certainly has helped the operating leverage of that BU.

安雅，讓我對此添加評論。如果展望 2024 年，安全訂閱收入將首次超過硬體收入。最重要的是，如果算上維護、支援和訂閱，我們的安全業務部門大約只有三分之二是軟體。因此，這無疑有助於提高該業務部門的營運槓桿。

Okay. And at what sort of revenue level do you expect to be profitable in the Security Solutions?

好的。您預計安全解決方案的收入水平如何？

Yes. So that was -- as you know, Security Solutions is our highest -- of the two BUs, the one that generates the most profit. If you're looking for a revenue breakeven for that business unit, I mean, you can probably look at mid -- low to mid-20s is probably a good number. But just doing the math here in my head, Anja, if you just look at -- just try to look at the numbers. So on a quarterly basis, yes.

是的。如您所知，安全解決方案是我們兩個業務部門中最高的，也是產生最多利潤的一個。如果你正在尋找該業務部門的收入盈虧平衡點，我的意思是，你可以考慮中--20 歲左右可能是一個不錯的數字。但只是在我的腦海裡做數學計算，安雅，如果你只是看看——試著看看數字。所以按季度計算，是的。

Sorry. Just to clarify that.

對不起。只是為了澄清這一點。

I am showing no further questions at this time. I would now like to turn it back to Joe Maxa for closing remarks.

我目前沒有提出任何進一步的問題。現在我想請 Joe Maxa 發表結束語。

Thank you, everyone. Thank you for your time today. We look forward to sharing our progress with you again next quarter. Thanks again and have a great day.

謝謝大家。感謝您今天抽出時間。我們期待下個季度再次與您分享我們的進展。再次感謝，祝您有美好的一天。

All right. Thank you for your participation in today's conference. This does conclude the program and you may now disconnect.

好的。感謝您參加今天的會議。這確實結束了程序，您現在可以斷開連接。