CXApp Inc. Q2 FY2024 earnings call

• Market Trends: Hybrid work is becoming structured, with 37% of U.S. companies adopting a structured hybrid model. Office occupancy has flattened to around 50% of 2019 levels, indicating a new work norm.
• CXAI Platform: CXAI is an AI-native enterprise employee experience platform that integrates with 100 corporate systems, provides enterprise-grade security, and uses analytics to improve productivity. It starts with a branded immersive mobile/web app. The company has a multiyear agreement with Google Cloud for access to AI infrastructure and monitoring.
• Key Deals: Signed the largest expansion deal in the financial services sector, with a major enterprise scaling globally after pilots. A new CXAI platform is on track for Q4 deployment, which is multi-tenant, multi-OS, and multi-cloud.
• Operational Updates: A new CXAI platform pilot is planned for Q3, with deployment to major sites in Q4. CXAI VU analytics platform is in three pilots in Q3 across diversified customers (consumer, tech, financial services).

For Q2 2024, CXAI had $1.91 million of bookings. Recurring subscription revenue was 85%, up from 79% a year ago. Gross margins increased by 5.5 basis points from the previous year. Annual recurring revenue (ARR) grew by 120% due to a large expansion deal in the financial sector. Net retention rate was 105%, driven by five renewals and the record expansion deal. OpEx was reduced by over 15% compared to last year, with AI and AI tools contributing to cost structure optimization.

• The new CXAI platform is scheduled for global deployment to major sites in Q4.
• CXAI VU analytics platform is in three pilots in Q3 with diversified customers.
• Continued growth is expected through partnerships like Google Cloud and expansion deals with enterprise customers.

• Security challenges associated with handling enterprise data and ensuring compliance with industry standards.
• Potential issues with the implementation and adoption of hybrid work models, such as 'hush hybrid' behaviors (e.g., coffee badging) that may require additional solutions.

Q: Is the business with Google set for big growth or slow growth?

A: Set for growth, working closely with Google Cloud and planning to leverage their technology for innovation.

Q: Could you clarify the S-1 filing?

A: The S-1 was refiled due to a delay in the 10-K and to account for a debt equity deal conversion potential.

Q: Could CXAI app partner with Palantir in the future?

A: Happy to engage with Palantir, focused on enterprise customers currently, but open to potential partnerships.