NICE Ltd. Q2 FY2025 earnings call

• Strong Q2 results: Total revenue exceeded high end of guidance range, EPS at high end of range. Total revenue $727M, 12% Y/Y cloud growth, NRR 111%. • AI momentum: 42% Y/Y growth in AI and self-service ARR to $238M. Sixfold Y/Y increase in Copilot deals. • Acquisition: Integration of Cognigy to enhance CXone Mpower for human-like AI-first customer experiences. • Partnerships: Alliances with ServiceNow, AWS, Snowflake, Salesforce, RingCentral to drive go-to-market and innovation. • International growth: Large deals in EMEA (DWP, AOK PLUS) and APAC, with revenue ramping in future quarters. • Interactions event: 33% Y/Y surge in attendance, 41% Y/Y C-level engagement, validating business momentum.

In Q2 2025, total revenue reached $727 million. Cloud revenue was $541 million, representing 74% of total revenue and growing 12% year-over-year. AI and self-service ARR grew 42% year-over-year to $238 million, which is 11% of cloud revenue. Product revenue increased 29% year-over-year due to pull-forward of term renewal activity from Financial Crime and Compliance. Services revenue, representing 19% of total revenue, declined 5%. Geographically, the Americas region increased 9% year-over-year. EMEA revenue grew 11% and 15% on a constant currency basis, APAC revenue increased 17% year-over-year (constant currency), and international revenue overall increased 13% year-over-year (16% constant currency). Customer Engagement revenue was $597 million (82% of total), up 8% year-over-year. Financial Crime and Compliance revenue totaled $130 million (18% of total), growing 19% year-over-year.

• Third quarter 2025: Total revenue expected $722M-$732M (5% Y/Y growth), non-GAAP EPS $3.12-$3.22. • Full year 2025: Total revenue $2.918B-$2.938B (7% Y/Y growth), cloud revenue growth 12% full year, non-GAAP operating margin up 50 bps, non-GAAP EPS $12.33-$12.53 (12% Y/Y growth).

• Unanticipated churn in LiveVox business, impacting cloud growth expectations. • Competition in the CX market, including legacy CCaaS platforms and other AI competitors. • Regulatory uncertainties related to AI disclosure and adoption, which could impact customer adoption and revenue.

Q: AI impact on ARPU?

A: Scott Russell said AI capabilities are incremental, not causing ARPU erosion, with value of the platform increasing through AI and other capabilities, leading to successful monetization.