Research Solutions Inc (RSSS) 2024 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to this Research Solutions, Inc., conference call. (Operator Instructions) Please note this call may be recorded. (Operator Instructions)

女士們、先生們，美好的一天，歡迎參加本次 Research Solutions, Inc 電話會議。（操作員說明）請注意，此通話可能會被錄音。（操作員說明）

It is now my pleasure to turn today's program over to John Beisler with Investor Relations.

現在我很高興將今天的節目交給投資者關係部門的約翰貝斯勒 (John Beisler)。

Thank you, operator, and good afternoon, everyone. Thank you for joining us today for Research Solutions' third quarter fiscal 2024 earnings call.

謝謝接線員，大家下午好。感謝您今天參加 Research Solutions 的 2024 財年第三季財報電話會議。

On the call today are Roy W. Olivier, President and Chief Executive Officer, and Bill Nurthen, Chief Financial Officer. After the market closed this afternoon, the company issued a press release announcing its results for the third quarter of fiscal 2024. The release is available on the company's website at researchsolutions.com.

今天參加電話會議的有總裁兼執行長 Roy W. Olivier 和財務長 Bill Nurthen。今天下午收盤後，該公司發布新聞稿，公佈了 2024 財年第三季業績。此版本可在該公司網站 Researchsolutions.com 上取得。

Before Roy and Bill begin their prepared remarks, I would like to remind you that some of the statements made today will be forward-looking and made under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those expressed or implied due to a variety of factors. We refer you to Research Solutions' recent filings with the SEC for a more detailed discussion of the risks that could impact the company's future operating results and financial conditions.

在羅伊和比爾開始準備好的發言之前，我想提醒大家，今天發表的一些聲明將具有前瞻性，並且是根據 1995 年《私人證券訴訟改革法案》做出的。由於多種因素，實際結果可能與明示或暗示的結果有重大差異。我們建議您參閱 Research Solutions 最近向 SEC 提交的文件，以更詳細地討論可能影響該公司未來營運績效和財務狀況的風險。

Also on today's call, management will reference certain non-GAAP financial measures, which we believe provide useful information for investors. A reconciliation of those measures to GAAP measures is included in the earnings release issued earlier this afternoon. Finally, I would like to remind everyone this call will be recorded and made available for replay via a link on the company's website.

此外，在今天的電話會議上，管理層還將參考某些非公認會計準則財務指標，我們相信這些指標為投資者提供了有用的信息。這些措施與公認會計準則措施的調節包含在今天下午早些時候發布的收益報告中。最後，我想提醒大家，這次通話將會被錄音，並可透過公司網站上的連結重播。

I would now like to turn the call over to Roy W. Olivier. Roy?

我現在想把電話轉給羅伊·W·奧利維爾。羅伊？

Roy, you may be on mute.

羅伊，你可能處於靜音狀態。

I'm on mute. You think I haven't done this before? (laughter) Thank you, John, and thank you, Bill.

我靜音了你認為我以前沒有這樣做過嗎？（笑聲）謝謝你，約翰，謝謝你，比爾。

As we've discussed on previous calls, it is our strategy to reimagine and improve the research workflow. Our recent acquisitions are a big part of that journey's success. After a few months of performance from Scite and Resolute, I remain excited and committed to the vision and how Scite and Resolute fits into that. We had strong quarterly results in terms of overall growth, adjusted EBITDA, and cash flow from operations. The results are starting to show the ability of the business to scale as we continue this journey. The quarter represents a run rate of more than $48 million in revenue, with $16 million in SaaS platform revenue and approximately $32 million in document delivery or transaction revenue.

正如我們在之前的電話會議中討論的那樣，我們的策略是重新構想和改進研究工作流程。我們最近的收購是這趟旅程成功的重要組成部分。經過 Scite 和 Resolute 幾個月的表現後，我仍然感到興奮並致力於實現這一願景以及 Scite 和 Resolute 如何融入其中。我們在整體成長、調整後 EBITDA 和營運現金流方面取得了強勁的季度業績。隨著我們繼續這趟旅程，結果開始顯示出業務擴展的能力。該季度的營業收入超過 4,800 萬美元，其中 SaaS 平台收入為 1,600 萬美元，文件交付或交易收入約為 3,200 萬美元。

I'm excited about the strategic and product progress we are making and what it means for our future growth. That said, I'm very excited about the financial transformation the business will undertake as we continue this journey and how it will translate to shareholder value creation. There's lots of moving pieces in the numbers.

我對我們正在取得的策略和產品進展及其對我們未來成長的意義感到興奮。也就是說，我對公司在繼續這趟旅程時將進行的財務轉型以及它將如何轉化為股東價值創造感到非常興奮。數字中有很多變化的部分。

So I'd like to pass it over to Bill to walk through our fiscal third quarter 2024 financial results in detail, and then I'll be back to discuss the businesses progress and quarterly accomplishments in more detail. Bill?

因此，我想將其交給 Bill，詳細介紹我們 2024 年第三季的財務業績，然後我將回來更詳細地討論業務進展和季度成就。帳單？

Thank you, Roy, and good afternoon, everyone. Before I begin, I'd like to remind everyone that our third quarter results now include a full quarter's contribution from both the acquisition of ResoluteAI, which closed on July 28 of last year, and the Scite acquisition, which closed on December 1, 2023. For fiscal year-to-date numbers, there are approximately eight months of ResoluteAI and four months of Scite factored into the numbers.

謝謝羅伊，大家下午好。在開始之前，我想提醒大家，我們第三季的業績現在包括去年 7 月 28 日完成的 ResoluteAI 收購和 2023 年 12 月 1 日完成的 Scite 收購對整個季度的貢獻。對於本財年迄今的數據，大約有 8 個月的 ResoluteAI 和 4 個月的 Scite 已計入這些數據。

Total revenue for the third quarter of fiscal 2024 was $12.1 million, a 17% increase from the third quarter of fiscal 2023. Our platform subscription revenue increased 76% to approximately $4 million. The growth was primarily driven by revenue contributed from the Scite acquisition, as well as a net increase of platform deployments from last year and the addition of platform revenue from the ResoluteAI acquisition. We ended the quarter with $16.6 million in annual recurring revenue, or ARR, up 82% year-over-year and about 6% sequentially. We added about $1 million of incremental ARR in the quarter, the vast majority of which was in the Scite B2C business.

2024財年第三季總營收為1,210萬美元，較2023財年第三季成長17%。我們的平台訂閱收入成長了 76%，達到約 400 萬美元。這一成長主要得益於收購 Scite 帶來的收入、較去年平台部署的淨增長以及收購 ResoluteAI 帶來的平台收入的增加。截至本季末，我們的年度經常性收入 (ARR) 為 1,660 萬美元，年增 82%，季增約 6%。本季我們增加了約 100 萬美元的增量 ARR，其中絕大多數來自 Scite B2C 業務。

I wanted to take a few minutes to discuss the limited sequential increase we experienced in B2B ARR in the quarter. We did, in fact, grow both Scite B2B and Article Galaxy in the quarter. However, the vast majority of that growth was offset by churn in the ResoluteAI business. While this churn was material, it was not completely unexpected and was concentrated across three large customers, all of which had renewal dates in Q3. The downside of this is the effect that it had on ARR in the quarter. The upside is that we have now cycled through most of the ResoluteAI customers from a renewal perspective, and a good portion of the churn risk is behind us. This does not mean that we will not have future churn in ResoluteAI. However, we believe the worst is largely behind us, and we are rolling out new products using the Resolute technology.

我想花幾分鐘討論一下本季 B2B ARR 經歷的有限連續成長。事實上，我們在本季確實實現了 Scite B2B 和 Article Galaxy 的成長。然而，絕大多數成長被 ResoluteAI 業務的流失所抵消。雖然這種流失很嚴重，但這並不完全出乎意料，而且集中在三個大客戶身上，所有這些客戶的續約日期都在第三季。這樣做的缺點是對本季 ARR 的影響。好的一面是，我們現在已經從更新的角度循環了大多數 ResoluteAI 客戶，並且很大一部分客戶流失風險已經過去。這並不意味著 ResoluteAI 未來不會出現流失。然而，我們相信最糟糕的情況已基本過去，我們正在推出使用 Resolute 技術的新產品。

On a positive note, Scite growth in both B2B and B2C ARR in the quarter was strong and above expectations. Additionally, we had some large cross-sell successes of Scite within our Article Galaxy customer base, which Roy will speak about in more detail. When we announced the Scite acquisition, we noted that they had about $3.6 million of ARR. Today, they are at roughly $5.5 million, and we continue to believe there's a lot of upside in both the B2B and B2C side of the business. Please see today's press release for how we define and use annual recurring revenue and other non-GAAP terms.

從積極的方面來看，Scite 本季 B2B 和 B2C ARR 的成長強勁且超乎預期。此外，我們在 Article Galaxy 客戶群中取得了一些大規模的 Scite 交叉銷售成功，Roy 將更詳細地談論這一點。當我們宣布收購 Scite 時，我們注意到他們擁有約 360 萬美元的 ARR。如今，其營收約為 550 萬美元，我們仍然相信 B2B 和 B2C 業務都有很大的上升空間。請參閱今天的新聞稿，以了解我們如何定義和使用年度經常性收入和其他非公認會計準則術語。

Transaction revenue for the third quarter was $8.2 million, a 1% increase from the prior year quarter. This quarter represents our first year-over-year comparison that includes the customer contracts acquired from the FIZ Karlsruhe acquisition, which was effective January 1, 2023. While the year-over-year increase was modest, Q3 is typically our seasonally best time for transaction revenue, and this quarter represented a company high mark for quarterly transaction revenue.

第三季交易營收為 820 萬美元，比去年同期成長 1%。本季度是我們的首次同比比較，其中包括從 FIZ Karlsruhe 收購中獲得的客戶合同，該收購於 2023 年 1 月 1 日生效。雖然年增幅不大，但第三季通常是我們交易收入的季節性最佳時期，而本季代表了公司季度交易收入的高分。

Further, the year-over-year comparison was largely affected by a normal slowdown we experienced during the week of Easter, which was in March this year and was in April of last year. In looking at early returns for April, the opposite effect is happening, and we are up significantly year-over-year with a strong start for the quarter. Our total active customer count for the quarter was 1,426 compared to 1,417 in the same period a year ago.

此外，同比比較在很大程度上受到我們在復活節這一周經歷的正常放緩的影響，復活節是今年三月和去年四月。從四月份的早期回報來看，相反的效果正在發生，我們的業績同比大幅增長，本季開局強勁。本季我們的活躍客戶總數為 1,426 名，去年同期為 1,417 名。

Gross margin for the third quarter was 45.2%, a 630 basis point improvement over the third quarter of 2023. The increase is due to the ongoing revenue mix shift towards our higher-margin platforms business. The platform business recorded gross margin of 85.5%, a decrease compared to 88.1% in the prior year quarter, but within the range of our gross margin expectations for platform revenue. The decrease is also related to the inclusion of Resolute's platform revenues, which generate a lower margin.

第三季毛利率為45.2%，較2023年第三季提高630個基點。這一成長是由於收入結構持續轉向利潤率更高的平台業務。平台業務毛利率為85.5%，較去年同期的88.1%有所下降，但在我們對平台收入的毛利率預期範圍內。這一下降也與包含 Resolute 平台收入有關，該收入產生的利潤率較低。

Gross margin on Article Galaxy remained consistent with recent history, and the gross margin of Scite's products are similar to that of Article Galaxy. Gross margin in our transaction business increased 40 basis points to 25.7%. The increase was primarily attributable to increased copyright margins. This result was a little higher than we normally expect. And going forward, margins will likely fall back into a range between 24% and 25%. We remain confident in our ability to increase the company's blended gross margin as the revenue mix continues to be more heavily weighted with platform revenues.

Article Galaxy 的毛利率與近期歷史保持一致，Scite 產品的毛利率與 Article Galaxy 相似。交易業務毛利率成長 40 個基點至 25.7%。這一增長主要歸因於版權利潤的增加。這個結果比我們通常預期的要高一些。展望未來，利潤率可能會回落至 24% 至 25% 之間。我們對提高公司綜合毛利率的能力仍然充滿信心，因為收入組合繼續在平台收入中佔據更大比重。

Platform revenues are now about a third of the business, but contributing over 60% of the gross profit. Total operating expenses in the quarter were $5.4 million compared to $3.9 million in the prior year quarter. The increase is primarily attributable to the addition of ResoluteAI and Scite in the current quarter's results, as well as approximately $300,000 of non-cash depreciation and amortization expense, largely associated with the amortization of intangible assets associated with the acquisitions.

目前平台收入約佔業務的三分之一，但貢獻了超過60%的毛利。本季總營運費用為 540 萬美元，去年同期為 390 萬美元。這一成長主要歸因於本季業績增加了 ResoluteAI 和 Scite，以及約 30 萬美元的非現金折舊和攤銷費用，主要與收購相關的無形資產攤銷有關。

Turning to profitability, I mentioned on our last call that I thought the back half of our year would be much cleaner from a one-time expense perspective, allowing us an opportunity to demonstrate the profitability of the business. Recall that in the first half of the year, we experienced roughly $1.3 million in expenses related to the proxy matter and M&A activities. In Q3, with those expenses largely behind us, we were able to post an operating profit and positive net income.

談到獲利能力，我在上次電話會議上提到，我認為從一次性費用的角度來看，今年下半年會更加乾淨，讓我們有機會展示業務的盈利能力。回想一下，今年上半年，我們經歷了大約 130 萬美元的與代理商事宜和併購活動相關的費用。在第三季度，這些費用基本上已經過去，我們能夠實現營業利潤和正淨利潤。

Net income was $76,000 or breakeven on a diluted per share basis compared to net income of $230,000 (sic - see news release, "$236,842"), or $0.01 per share in the prior year quarter. This profitability also translated into a strong adjusted EBITDA performance. We generated a company record of $961,000 of adjusted EBITDA for the quarter compared to $559,000 in the year ago quarter.

稀釋後每股淨利為 76,000 美元，即損益平衡，而去年同期淨利為 230,000 美元（原文如此，請參閱新聞稿「236,842 美元」），即每股 0.01 美元。這種獲利能力也轉化為強勁的調整後 EBITDA 業績。本季調整後 EBITDA 為公司創紀錄的 961,000 美元，去年同期為 559,000 美元。

Turning to our balance sheet. We also experienced a new company record with respect to cash flow from operations in the quarter. In the quarter, we generated over $2 million in cash flow from operations compared to $0.8 million in the year ago quarter. Cash and cash equivalents as of March 31, 2024, was $4.2 million compared to $2.7 million in the prior quarter, and that is where we stood at the end of Q2 after the cash spent for the Scite acquisition.

轉向我們的資產負債表。本季我們的營運現金流也創下了公司新紀錄。本季度，我們的營運現金流超過 200 萬美元，去年同期為 80 萬美元。截至 2024 年 3 月 31 日，現金和現金等價物為 420 萬美元，而上一季為 270 萬美元，這是我們在支付 Scite 收購現金後第二季末的情況。

We also entered into a new $500,000 line of credit with PNC Bank that remains untapped. This line is flexible from both a covenant and cash diversification perspective, and we think it is a good fit for our needs and where we stand with the business today.

我們也與 PNC 銀行簽訂了 50 萬美元的新信貸額度，但尚未動用。從契約和現金多元化的角度來看，這條線都很靈活，我們認為它非常適合我們的需求以及我們今天的業務立場。

As we look ahead, I think Q4 has the potential to be very similar to Q3 with some exceptions. First, with Q3 seasonally being our strongest period for transaction revenue, I would expect transaction revenue to be down sequentially, but up modestly year-over-year. Second, we are seeing very positive returns on our advertising spend related to B2C customer acquisition. As a result, we will be experimenting with increased advertising spend in Q4. So our sales and marketing expenses will likely be higher. All that said, I think the quarter will be relatively clean, and we should experience another strong adjusted EBITDA performance with cash flow behind it.

展望未來，我認為第四季有可能與第三季非常相似，但有一些例外。首先，由於第三季是我們交易收入最強的時期，我預期交易收入將環比下降，但比去年同期小幅成長。其次，我們看到與 B2C 客戶獲取相關的廣告支出獲得了非常正面的回報。因此，我們將在第四季度嘗試增加廣告支出。因此我們的銷售和行銷費用可能會更高。話雖如此，我認為本季將相對乾淨，我們應該會經歷另一個強勁的調整後 EBITDA 表現，並有現金流支持。

I'll now turn the call back to Roy. Roy?

現在我將把電話轉回給羅伊。羅伊？

Thanks, Bill. In our last earnings call, I discussed our BHAG or big goal of $30 million in ARR by the end of FY26. Our ARR at the end of Q3 is $16.6 million, which means we're pacing a little behind that goal. However, this was largely due to the churn Bill mentioned within the ResoluteAI business. Overall, our progress toward the BHAG will not be straight line, but I remain comfortable with where we stand today.

謝謝，比爾。在我們上次的財報電話會議中，我討論了我們的宏偉目標，即到 2026 財年末實現 ARR 3000 萬美元的宏偉目標。第三季末我們的 ARR 為 1,660 萬美元，這意味著我們稍微落後於該目標。然而，這主要是由於 Bill 提到的 ResoluteAI 業務中的流失所造成的。總體而言，我們在實現宏偉目標方面的進展不會是直線的，但我對我們今天的立場仍然感到滿意。

In addition, I'm very pleased with our revenue, adjusted EBITDA, cash flow from operations performance in the quarter, but we have several areas we need to continue to work on. My top three priorities are as follows. First, integration across the new products that we've acquired as part of the Resolute and Scite acquisitions. We have completed the first phase of the Scite-Article Galaxy or AG integration. We now support single sign-on, so users can seamlessly jump between AG and the Scite product. We also have added the Scite badge to the Article Galaxy product. As a reminder, this unique feature of the Scite product allows for a FICO or Rotten Tomatoes score for articles, so the user can more quickly judge the quality of the article or articles, while an AG user can click on that badge and jump to the Scite product to see detailed results and all users in Scite can see pricing and availability of the articles in the Scite platform.

此外，我對本季我們的收入、調整後的 EBITDA 和營運績效現金流感到非常滿意，但我們還有幾個領域需要繼續努力。我的三大優先事項如下。首先，整合我們在 Resolute 和 Scite 收購中獲得的新產品。我們已經完成了 Scite-Article Galaxy 或 AG 整合的第一階段。我們現在支援單一登錄，因此用戶可以在 AG 和 Scite 產品之間無縫跳轉。我們還在 Article Galaxy 產品中新增了 Scite 徽章。提醒一下，Scite產品的這一獨特功能允許對文章進行FICO或爛番茄評分，因此用戶可以更快地判斷一篇或多篇文章的質量，而AG用戶可以點擊該徽章並跳轉到Scite 產品可查看詳細結果，Scite 中的所有用戶都可以查看Scite 平台中文章的定價和可用性。

The second is Article Galaxy growth. As a reminder, we have four drivers of Article Galaxy growth. The team will refer to as the new-new team, sells new logos and is on track to beat last year. The new existing team, which sells transaction-only customers, Article Galaxy, is also on track to beat last year. We continue to see challenges with the upsell team who historically has delivered strong performance through moving customers up to more advanced features or software versions in addition to adding seats and licenses. We continue to see that our customers are more careful with spend versus previous years.

第二條是銀河成長。提醒一下，Article Galaxy 的成長有四個驅動因素。該團隊將被稱為“新新團隊”，銷售新徽標，並有望擊敗去年。銷售純交易客戶的新現有團隊Article Galaxy也有望超越去年。我們繼續看到追加銷售團隊面臨的挑戰，除了增加席位和許可證之外，他們歷來透過將客戶升級到更高級的功能或軟體版本來提供強勁的業績。我們繼續看到，與前幾年相比，我們的客戶在消費方面更加謹慎。

The fourth driver of churn, which continues to remain high -- higher, I'm sorry, than we have historically seen. That said, we have not seen any material increase in churn due to competition. A majority of our churn is uncontrollable and that it is due to the customer being acquired or going out of business. There is a block of controllable churn that we need to work on, and we brought in new leadership for that group, who's doing a nice job setting up new workflows and increasing our customer outreach to get ahead of this problem.

流失率的第四個驅動因素，流失率繼續保持在較高水平，抱歉，比我們歷史上看到的還要高。也就是說，我們沒有看到由於競爭而造成的客戶流失率出現任何實質增加。我們的大部分流失都是無法控制的，這是由於客戶被收購或倒閉造成的。我們需要解決一個可控的流失問題，我們為團隊引入了新的領導層，他在建立新的工作流程和擴大客戶服務範圍方面做得很好，以解決這個問題。

My third priority is, where we invest in growth? As we enter the next phase of our growth, we need to be thoughtful about how and where we will make investments to drive that growth. I think it's time we move forward building out a more focused sales approach around verticals or products to accelerate new logo onboarding. We are in our FY25 planning now, and I'll report back on this in our next call.

我的第三個優先事項是，我們在哪裡投資成長？當我們進入下一階段的成長時，我們需要考慮如何以及在哪裡進行投資以推動成長。我認為現在是時候我們圍繞垂直行業或產品建立更集中的銷售方法，以加速新徽標的使用。我們現在正在進行 25 財年規劃，我將在下次電話會議中報告這一情況。

We have seen a lot of exciting activity with the new Scite product. From a B2B perspective, I reported in our last call that Scite B2B ARR was around $400,000. We closed over $200,000 in new Scite deals in Q3 alone, some of which were cross-sell into our existing customer base. We have a very strong pipeline and expect to see strong results in the next couple of quarters. As part of the aforementioned cross-sells, we closed the largest Scite deal ever to a large pharma customer, which is a 3-year contract. We closed our second deal in India, our first deal in Mainland China, and two more first for that country deals in the Middle East.

我們已經看到新的 Scite 產品帶來了許多令人興奮的活動。從 B2B 的角度來看，我在上次電話會議中報告稱，Scite B2B ARR 約為 40 萬美元。僅在第三季度，我們就完成了超過 20 萬美元的新 Scite 交易，其中一些是針對我們現有客戶群的交叉銷售。我們擁有非常強大的產品線，預計在接下來的幾個季度中將取得強勁的業績。作為上述交叉銷售的一部分，我們與大型製藥客戶達成了有史以來最大的 Scite 交易，這是一份為期 3 年的合約。我們在印度完成了第二筆交易，在中國大陸完成了第一筆交易，在中東又完成了兩項第一筆交易。

On the Article Galaxy side, we've seen some good progress in the new-new teams in terms of competitive takeaways and in closing larger deals. We closed the large Article Galaxy deal to a top 10 pharma customer during the quarter. I'm excited to see the progress here, as in the past, we've had more success with SMB. While SMB remains a majority of our new logos, our competitiveness in large deals is great for the business long term.

在Article Galaxy方面，我們看到新團隊在競爭優勢和完成更大交易方面取得了一些良好進展。我們在本季向排名前 10 位的製藥客戶完成了大型 Article Galaxy 交易。我很高興看到這裡的進展，與過去一樣，我們在 SMB 方面取得了更多成功。雖然 SMB 仍然是我們新徽標的大部分，但從長遠來看，我們在大型交易中的競爭力對業務來說非常重要。

On the Resolute side, we saw unprecedented churn in Q3. As Bill mentioned, we do not expect that churn to return -- I'm sorry, to remain and expect it to return to more historic levels going forward. On the positive side, we did close a contract with an existing AG client, and we leased two new solutions around the technology landscape and clinical trial reporting based on Resolute's software and data sets.

在 Resolute 方面，我們在第三季看到了前所未有的流失。正如比爾所提到的，我們預計這種流失不會再次出現——很抱歉，我們會繼續保留下去，並期望它將在未來恢復到更高的歷史水平。從積極的一面來看，我們確實與現有的 AG 客戶簽訂了合同，並且基於 Resolute 的軟體和數據集，圍繞技術領域和臨床試驗報告租賃了兩個新的解決方案。

The B2B Scite products -- sorry, the B2B Scite product continues to show great progress. At the end of Q2, we reported B2C ARR to be $4 million. We ended Q3 at $4.9 million. We continue to experiment with ad spend and monitor conversion to trials and then to subscribers. We have also seen some success in our B2C to B2B cross-sell efforts. We've seen a few individual B2C subscribers move into the B2B sales pipeline and close. We are entering the typical slow season in the summer months for B2C, but we remain excited about this business' contribution as we move into FY25.

B2B Scite 產品－抱歉，B2B Scite 產品繼續顯示出巨大的進步。第二季末，我們報告 B2C ARR 為 400 萬美元。第三季末，我們的營收為 490 萬美元。我們繼續試驗廣告支出，並監控試驗的轉換率，然後是訂閱者的轉換率。我們在 B2C 到 B2B 交叉銷售方面也取得了一些成功。我們已經看到一些 B2C 個人訂戶進入 B2B 銷售管道並關閉。我們正在進入 B2C 夏季典型的淡季，但隨著我們進入 2025 財年，我們仍然對該業務的貢獻感到興奮。

Moving to document delivery or DocDel. Our reported transaction revenue, we experienced a material slowdown in transaction sales in late March due to Easter this year. Last year, Easter was in April. I can report that we've seen strong rebound in DocDel sales in early April. I can also report that due to some work in the platform and through agreements to manage the publishers' paywall, we're seeing some nice DocDel growth over FY23.

轉向文件交付或 DocDel。根據我們報告的交易收入，由於今年復活節，我們在三月下旬經歷了交易銷售的大幅放緩。去年，復活節是在四月。我可以報告說，我們在 4 月初看到了 DocDel 銷售額的強勁反彈。我還可以報告說，由於平台上的一些工作以及透過管理出版商付費專區的協議，我們看到 DocDel 在 2023 財年實現了一些不錯的成長。

In addition, we're starting to see some B2C sales as we integrate pricing and availability into the Scite product and due to UX improvements in Article Galaxy. You may recall we had some concerns about the impact of the proxy matter on our employee base. We also recently completed our second Gallup Employee Engagement Survey, and I'm pleased to report that we showed a nice improvement from a year ago. Our engaged versus actively disengaged ratio has improved significantly.

此外，由於我們將定價和可用性整合到 Scite 產品中，並且由於 Article Galaxy 中的用戶體驗改進，我們開始看到一些 B2C 銷售。您可能還記得，我們​​對代理事宜對我們員工基礎的影響有些擔憂。我們最近也完成了第二次蓋洛普員工敬業度調查，我很高興地報告說，我們比一年前有了很大的進步。我們的參與度與主動脫離度的比率已顯著改善。

While we have and we will always have more work to do, I'm very pleased with the progress in the Gallup results. As many of you know, I'm typically very measured in my comments about the business. When we did the diligence on Scite, we believe that its combination with our business had the potential to be very exciting and a transformational event. After a few months, I'm even more convinced that this is a path that can lead to something much greater than a simple one plus one. Our employees and customers are excited about what we can do to help research. And while I'm happy with the Q3 results, I'm also very excited about our overall direction and the long-term potential of what we are building here, how we can help improve research and what that means for long-term shareholder value creation.

雖然我們現在還有更多的工作要做，但我對蓋洛普結果的進展感到非常滿意。正如你們許多人所知，我對公司的評論通常非常謹慎。當我們對 Scite 進行盡職調查時，我們相信它與我們業務的結合有可能成為非常令人興奮的變革性事件。幾個月後，我更確信這是一條比簡單的一加一更偉大的道路。我們的員工和客戶對我們為研究提供幫助感到興奮。雖然我對第三季的結果感到滿意，但我也對我們的總體方向和我們在這裡建設的長期潛力、我們如何幫助改進研究以及這對長期股東價值意味著什麼感到非常興奮。

With that, I'd like to turn the call back over to the operator for Q&A. Operator?

這樣，我想將電話轉回給接線生進行問答。操作員？

(Operator Instructions) Jacob Stephan, Lake Street.

（操作員指示）Jacob Stephan，湖街。

Hey, guys, appreciate you taking my questions here and congrats on the quarter as well. Roy, you made a comment kind of regarding churn and how it's usually not due to competition. I'm just curious how your kind of seeing the opportunity to win market share from some of your competitors and kind of how you're positioning yourself there?

嘿，夥計們，感謝您在這裡回答我的問題，也祝賀本季。羅伊，您對客戶流失發表了評論，以及客戶流失通常不是由於競爭造成的。我只是好奇您如何看待從一些競爭對手那裡贏得市場份額的機會以及您如何在那裡定位自己？

Yeah. That's a great question. I think our strategy is to have a superior product in the categories that we participate in, which include discovery tools, which is where Scite and Resolute come in. We continue to add functionality to Article Galaxy, which is our core access or document delivery platform. And we continue to add functionality to the references product, which is the reference management software.

是的。這是一個很好的問題。我認為我們的策略是在我們參與的類別中擁有卓越的產品，其中包括發現工具，這就是 Scite 和 Resolute 的用武之地。我們繼續為 Article Galaxy 添加功能，這是我們的核心存取或文件交付平台。我們繼續為參考文獻產品添加功能，即參考文獻管理軟體。

So moving forward, as we more tightly integrate these tools together, we think that's a competitive advantage and that you're not exporting from one tool and importing into the next tool. And integrating some of the unique features like the Scite badge and additional AI capability into the platforms, we think adds real value. In addition to the fact that our objective is to simply be the easiest and fastest research tool out there today. So it's a much longer conversation with that, but I feel like we have made progress and continue to have a good strategy to be competitive and take share as we move forward.

因此，展望未來，隨著我們將這些工具更緊密地整合在一起，我們認為這是一種競爭優勢，並且您不會從一個工具匯出並匯入到下一個工具。我們認為，將 Scite 徽章和附加人工智慧功能等一些獨特功能整合到平台中可以增加真正的價值。除此之外，我們的目標只是成為當今最簡單、最快的研究工具。因此，這是一個更長的對話，但我覺得我們已經取得了進展，並且在我們前進的過程中繼續擁有良好的策略來保持競爭力並獲得份額。

Got it. Understood. And maybe just one more. You guys had a solid quarter and kind of B2C expansion. You noted kind of sales and marketing efforts are going to be implemented kind of in Q4 here. But I guess, how should we think about kind of sales and marketing moving forward? We saw your first quarter over $1 million in expense here in Q3. But maybe just any sense on how we can see that trending over the near term here.

知道了。明白了。也許還有一個。你們的季度業績表現強勁，B2C 也有所擴張。您指出，銷售和行銷工作將在第四季度實施。但我想，我們應該如何考慮未來的銷售和行銷？我們在第三季看到你們第一季的支出超過 100 萬美元。但也許我們對如何看待短期內的趨勢有任何意義。

Yes. I'll let Bill comment on the numbers. I mean, big picture, as Bill mentioned, we will invest a bit more in digital ad spend as we continue to experiment with the right spend that drives trials and subscribers on the B2C side. On the B2B side, we don't expect any big changes as we roll into Q4. We may add some additional costs as we go into next year, but I think it will be negligible. But Bill, any comments?

是的。我會讓比爾對這些數字發表評論。我的意思是，從大局來看，正如比爾所提到的，我們將在數位廣告支出上投入更多，因為我們將繼續嘗試正確的支出，以推動 B2C 方面的試驗和訂閱者。在 B2B 方面，我們預計第四季不會有任何重大變化。進入明年，我們可能會增加一些額外成本，但我認為這可以忽略不計。但是比爾，有什麼意見嗎？

Yeah, a couple. First, this was the first quarter that we fully had Scite represented from a cost base perspective. And so that's what's kind of pushing us to the $1.1 million we had this quarter. And I do think that's sort of a reasonable run rate with the one exception of marketing spend. I think we're going to -- we'll experiment. We'll probably do anywhere, $150,000, maybe $200,000 of additional marketing spend in the quarter.

是的，一對。首先，這是我們從成本基礎角度充分體現 Scite 的第一季。這就是推動我們本季達到 110 萬美元的原因。我確實認為，除了行銷支出之外，這是一個合理的運行率。我想我們將進行實驗。本季我們可能會在任何地方增加 150,000 美元，也許 200,000 美元的額外行銷支出。

And there are metrics that we'll be looking at to see what kind of return we're getting on that expenditure and whether that will kind of continue going forward or not. And so it is something that, one, we get a very quick read on how it's working. And then two, we can adjust quite rapidly, turn on or turn off if we're not seeing the results that we want. So I think that's how I would look at that line on the P&L on a go-forward basis.

我們將專注於一些指標，看看我們從這筆支出中獲得了什麼樣的回報，以及這種支出是否會持續下去。因此，第一，我們可以快速了解它的工作原理。第二，如果我們沒有看到我們想要的結果，我們可以非常快速地調整，打開或關閉。所以我認為這就是我在未來的基礎上看待損益表上的這條線的方式。

Okay. Yeah. I appreciate that. And maybe -- sorry, just hop in with one more. Maybe kind of help us think about the overall B2C opportunity. Obviously, it was a nice quarter of ARR growth. But how are you thinking about kind of the overall opportunity here and growth rate -- growth expectations?

好的。是的。我很感激。也許——抱歉，再跳一個。也許可以幫助我們思考整體 B2C 機會。顯然，這是一個 ARR 成長良好的季度。但您如何看待這裡的整體機會和成長率—成長預期？

Yeah. I think B2C is new to us, and we don't know what we don't know relative to what really are good churn rates. I mean, when we compare it to the churn rates of the B2B business, they're obviously materially different, but the onboarding rate of new customers is also very, very different. So in terms of TAM for that business, we know that there's roughly -- I'm looking at the exact number, 25 million to 50 million researchers out there or when I say out there, I mean, that subscribe to a platform that focuses on research. So we think there's a very large TAM, especially in comparison to how many users we have today.

是的。我認為 B2C 對我們來說是新的，我們不知道我們不知道什麼是真正好的客戶流失率。我的意思是，當我們將其與 B2B 業務的流失率進行比較時，它們顯然有很大不同，但新客戶的入職率也非常非常不同。因此，就該業務的 TAM 而言，我們知道大約有——我正在查看確切的數字，2500 萬到 5000 萬研究人員，或者當我說那裡時，我的意思是，訂閱了一個專注於關於研究。因此，我們認為 TAM 非常大，特別是與我們今天擁有的用戶數量相比。

The question is, can we continue to deliver value to expand the lifetime value of the customer that signs up in addition to continuing to onboard customers? And so far, as we've increased spend, we've not seen a material change in terms of the cost per trial or the trial, the subscriber conversion rate. And that's why, as Bill mentioned, I mentioned, we're going to dial up that spend and see where the point is where we see any material change in those numbers. All that said, it has more seasonality than the rest of our business. So we're dialing up spend this much -- this month, I'm sorry. We're going to be careful about June, July, August, and then dial-up spend again as people get back to school.

問題是，除了繼續吸引客戶之外，我們還能繼續提供價值以擴大註冊客戶的終身價值嗎？到目前為止，隨著我們增加支出，我們沒有看到每次試用的成本或試用的訂閱者轉換率發生重大變化。這就是為什麼，正如比爾所提到的，我所提到的，我們將增加支出，看看我們看到這些數字有什麼實質變化。儘管如此，它比我們其他業務更具季節性。所以我們這個月要花這麼多錢，對不起。我們將在六月、七月、八月保持謹慎，然後當人們重返學校時再次進行撥號支出。

Anything you want to add, Bill?

比爾，你還有什麼要補充的嗎？

No, I think that covers it, Roy.

不，我想這已經涵蓋了，羅伊。

Okay, I appreciate it guys. Best of luck going forward here.

好的，我很感激你們。祝你在這裡一切順利。

Thank you.

謝謝。

Thank you.

謝謝。

(Operator Instructions) Allen Klee, Maxim Group.

（操作員說明）Allen Klee，Maxim Group。

Hi. You gave your F2026 guidance for annual recurring revenue. How do you think about how it ramps up over the next 2-plus years to get there? Does it kind of accelerate in your mind? Or is it kind of a steady Eddie? Or how do you think about that? Thanks.

你好。您提供了 F2026 年度經常性收入指導。您如何看待在未來兩年多的時間裡如何逐步實現這一目標？它在你的腦海中是否加速了？還是一個穩定的艾迪？或者你對此有何看法？謝謝。

Yeah. Just to be clear, I wouldn't call our $30 million target guidance. For me, it's a BHAG. It's a big hairy goal that we're chasing. And we typically don't provide guidance on the top or the bottom, but as you know, three years ago, I provided a BHAG of $20 million. That's what we were chasing, and now I've moved it to $30 million.

是的。需要明確的是，我不會將我們的 3000 萬美元目標稱為指導。對我來說，這是一個宏大的目標。這是我們正在追求的一個宏偉目標。我們通常不會提供頂部或底部的指導，但如你所知，三年前，我提供了 2000 萬美元的宏偉目標。這就是我們所追求的，現在我把它提高到了 3000 萬美元。

Back to your question, though. No, I think we'll see acceleration in the number. Keep in mind, we've not fully integrated the products. We haven't built all of the new products we're going to build out of the combination of the three companies: Research Solutions, Scite, and Resolute. We've also not finished implementation of a lot of things we think will drive road into the future. So me being relatively conservative, I'm looking for $1.5 million or $1.44 million in net ARR growth per quarter, but we won't hit that in these early quarters, but I believe we'll outperform that as we start to get into certainly the second half of FY25 and then throughout '26.

不過，回到你的問題。不，我認為我們會看到這個數字的加速。請記住，我們尚未完全整合這些產品。我們尚未透過 Research Solutions、Scite 和 Resolute 這三家公司的合併來建立我們將要建置的所有新產品。我們還沒有完成許多我們認為將推動未來發展的事情的實施。因此，我相對保守，我期望每季淨ARR 成長150 萬美元或144 萬美元，但我們不會在這些早期季度達到這個目標，但我相信，當我們開始進入確定的階段時，我們的表現會超過這個水準。

That's great. Thank you. Just a housekeeping question. What's your current share count?

那太棒了。謝謝。只是一個家政問題。您目前的股份數是多少？

Bill?

帳單？

Yes. It's right around $30 million to $35 million, I want to say, let me just confirm, $32.3 million roughly.

是的。大約是 3000 萬到 3500 萬美元，我想說，讓我確認一下，大約是 3230 萬美元。

Thank you, And you announced two new products or features recently. Can you talk about those features and if you can give any sense of the opportunity from them?

謝謝，您最近發布了兩款新產品或功能。您能談談這些功能嗎？

Yeah. We think within the organizations we serve, there's typically departments that are focused on clinical trial or tech landscape. And the way those products work is we're basically using one of our search engines to allow you to put in criteria. It will then gather together a tremendous amount of information. Some of it is in the peer-reviewed scientific articles. Some of it is in the external data sets that Resolute has, and it will literally write a summary of the tech landscape for the subject matter you search for or write a summary of the clinical trial research that you ask it to run. So effectively, what it does is it dramatically reduces the amount of time it takes to do those functions within heavy research-intensive organizations.

是的。我們認為，在我們服務的組織中，通常有一些部門專注於臨床試驗或技術領域。這些產品的工作方式是我們基本上使用我們的搜尋引擎之一來允許您輸入條件。然後它將收集大量資訊。其中一些是在同行評審的科學文章中。其中一些位於 Resolute 擁有的外部資料集中，它會逐字編寫您搜尋的主題的技術前景摘要，或編寫您要求其運行的臨床試驗研究的摘要。如此有效，它的作用是大大減少在重型研究密集型組織中執行這些功能所需的時間。

These tools, we don't expect to be tens of millions, but we do expect them to grow over time. However, I think the TAM for that is certainly smaller than Article Galaxy or Scite. Any of the versions of Scite's simply because the research organizations in the companies that are our targets are typically tens, hundreds, even thousands of researchers, whereas the departments that are doing that type of work are much smaller. So they're exciting products. They line up with our strategy of helping all the various steps and departments involved in the research process. But I would not think of them as an opportunity anywhere near the size of Scite, SciPro or Article Galaxy or Article Galaxy references.

我們預計這些工具的數量不會達到數千萬，但我們確實預計它們會隨著時間的推移而增長。然而，我認為 TAM 肯定比 Article Galaxy 或 Scite 小。Scite 的任何版本都只是因為我們的目標公司中的研究組織通常有數十、數百甚至數千名研究人員，而從事此類工作的部門則小得多。所以它們是令人興奮的產品。它們符合我們為研究過程中涉及的所有步驟和部門提供幫助的策略。但我不認為它們是與 Scite、SciPro 或 Article Galaxy 或 Article Galaxy 參考文獻規模相近的機會。

Thank you. Last question on your increase in sales and marketing as you've gotten good results for that. How do you think about like the hopeful, the cost to acquire, if you spend an extra dollar in sales and marketing, what you hope to get for that?

謝謝。最後一個問題是關於您在銷售和行銷方面的成長，因為您已經取得了良好的成果。你如何像充滿希望的人一樣思考獲取成本，如果你在銷售和行銷上多花一美元，你希望得到什麼？

Yeah. I mean, I can pull something up here and give you some context. When we invest -- well, Bill, do you want to comment on the B2C side, and I've got a couple of comments on the B2B side.

是的。我的意思是，我可以在這裡提取一些內容並為您提供一些背景資訊。當我們投資時——好吧，比爾，你想對 B2C 方面發表評論嗎？

Yeah. So typically, on B2C side, we're typically looking at two metrics. One is the customer acquisition cost and the time to pay back that cost and the other is the lifetime value of that customer as a ratio compared to the cost to acquire that customer. And so, obviously, as we're spending more, we're looking to see if those metrics are improving, not improving, and where can we kind of optimize those.

是的。因此，在 B2C 方面，我們通常會關注兩個指標。一個是客戶獲取成本和償還該成本的時間，另一個是該客戶的生命週期價值與獲取該客戶的成本的比率。因此，顯然，隨著我們支出更多，我們希望了解這些指標是否正在改善，是否沒有改善，以及我們可以在哪裡優化這些指標。

In general, looking for pretty quick payback like under six months or so, under 12 months is more of the standard, but we're looking maybe a little bit more aggressive there and trying to minimally be above kind of 3 times lifetime value to CAC. So those are things we're looking at, but it's really more -- are these trends? Are these numbers improving as we add spend? Are they starting to deteriorate? And that's what we're monitoring.

一般來說，尋求相當快的回報，例如六個月左右、十二個月以下是更標準的，但我們可能會更積極一點，並試圖至少高於 CAC 生命週期價值的 3 倍。這些是我們正在關注的事情，但實際上更重要的是——這些是趨勢嗎？隨著我們增加支出，這些數字是否有所改善？它們開始惡化了嗎？這就是我們正在監控的。

Yeah. We have a similar approach on the B2B side. Just the numbers are a bit different. So we typically have experienced between 12- and 18-month payback period, and we typically have a very large kind of lifetime value because customers don't churn out at a fast rate.

是的。我們在 B2B 方面也有類似的方法。只是數字有點不同。因此，我們通常會經歷 12 到 18 個月的投資回收期，而且我們通常會擁有非常大的終身價值，因為客戶不會快速流失。

So, again, our CAC LTV numbers there are very good, and that's another area of the business where I think we've done a nice job in the past few months of calibrating spend to maximize traffic that converts into sales pipeline. So I think we've made a lot of progress there. And I think that will start to show up in the numbers as we get into beginning of FY25.

因此，我們的 CAC LTV 數字非常好，我認為這是業務的另一個領域，在過去幾個月中，我們在調整支出以最大限度地提高轉換為銷售管道的流量方面做得很好。所以我認為我們在這方面取得了很大進展。我認為，隨著進入 2025 財年年初，這一點將開始體現在數字中。

Okay, great. Thank you so much and congrats on the quarter.

好的，太好了。非常感謝並祝賀本季。

Thank you.

謝謝。

And this does conclude our Q&A session for today's conference. I'm happy to turn the floor back to Mr. Olivier for any additional or closing remarks.

今天會議的問答環節到此結束。我很高興請奧利維爾先生發表補充或結束語。

Well, thank you, and thanks, everyone, for joining in the call today. We will be participating in the Three Part Advisors IDEAS Conference in New York City on June 12. Hope to see you there. Qualified investors that would like to attend or schedule a meeting should contact Three Part Advisors, and we look forward to speaking with you again in September to discuss our full-year and fourth quarter fiscal 2024 results. Have a great day.

好的，謝謝大家，謝謝大家今天加入電話會議。我們將參加 6 月 12 日在紐約市舉行的三部分顧問 IDEAS 會議。希望在那裡見到你。想要參加或安排會議的合格投資者應聯繫 Three Part Advisors，我們期待在 9 月再次與您交談，討論我們的全年和第四季度 2024 財年業績。祝你有美好的一天。

This does conclude today's teleconference, ladies and gentlemen, and we thank you for your participation. You may now disconnect your lines.

女士們、先生們，今天的電話會議到此結束，我們感謝你們的參與。現在您可以斷開線路。