Sangoma Technologies Corporation Q4 FY2024 earnings call

Charles Salameh's Remarks - Highlighted the first anniversary as CEO, discussed the transformation journey in FY '24, ending with revenue within guidance, adjusted EBITDA above midpoint, and cash conversion of 104%. Outlined strategic focus for FY '25 on organic growth, inorganic expansion, and market/channel development. Acknowledged addition of April Walker to the Board. ### Jeremy Wubs' Remarks - Spoke about FY '24 as a foundational year, go-to-market improvements, product plan with core platform capabilities, portfolio integration, and digital experience. Mentioned new Chief Revenue Officer Monica Walton, go-to-market pillars of partnership, sales talent, expanded lead gen, and structure. ### Larry Stock's Remarks - Discussed financial results for Q4 '24 and FY '24, including revenue, services vs. product revenue, cost of sales, gross margin, operating expenses, and balance sheet. Outlined guidance for FY '25 and Q1 '25, including revenue and adjusted EBITDA ranges, and noted one-time ERP costs.

In fiscal year 2024, services revenue was $202.1 million, representing a 1.83% increase and 82% of total quarter revenue in the fourth quarter of 2024. Product revenue was $45.1 million in fiscal 2024, a decline of approximately 16%, and 18% of total quarter revenue in the fourth quarter of 2024.

Fiscal 2025 - Revenue expected in the range of $250 million to $260 million and adjusted EBITDA in the range of $42 million to $46 million. ### Q1 2025 - Revenue in the range of $61 million to $62 million and adjusted EBITDA in the range of $9 million to $10 million. Adjusted EBITDA guidance includes approximately $2 million in one-time ERP costs. Excluding ERP costs, adjusted EBITDA margins expected to be 17%-18%.

Statements made during the call that are forward-looking are subject to various risks and uncertainties. Actual results may differ materially from forward-looking statements. Important factors causing differences are discussed in the accompanying MD&A, annual information form, and annual audited financial statements.

Q: Gavin Fairweather asked about the pipeline, deal sizes, and feedback from partners.

A: Charles Salameh mentioned larger deals in the pipeline, with Q2 to provide insight on pipeline growth, deal sizes. Jeremy Wubs added on account segmentation and joint go-to-market programs with partners.

Q: Mike Latimore asked about pipeline color, small business vs mid-market, and ERP's impact on sales cycles.

A: Charles Salameh and Jeremy Wubs discussed larger deals across solutions, momentum in UCaaS and contact center platform, and ERP helping with integration and cost reduction.

Q: David Kwan asked about larger deals and ERP's impact on enterprise market.

A: Larry Stock and Charles Salameh explained it's a combination of multi-product bundles and going after larger customers, with ERP enabling cross sell, upsell, and easier integration for acquisitions.