My name is Erik Zimmer. I'm the Executive Vice President of Corporate Development, Head of M&A and Investor Relations at Ceridian. I would like to welcome everyone to the Ceridian fourth quarter 2021 earnings call. All participants are in listen-only mode, and a question-and-answer session will follow the formal remarks. As a reminder, this conference is being recorded. Joining me on the call today, we have co-CEOs David Ossip and Leagh Turner, and CFO Noémie Heuland. Before I hand the call over to David and Leagh for some brief remarks, allow me to please provide a disclaimer regarding forward-looking statements. This call may include forward-looking statements about our current and future outlook, guidance, plans, expectations and intentions, results, levels of activities, performance, goals or achievements, and any other future events or developments. These statements are based on management's reasonable assumptions and beliefs in light of information currently available to us. Listeners are cautioned not to place undue reliance on such statements. Each forward-looking statement is subject to risks and uncertainties that could cause actual results to differ materially from those set forth in such statements. We refer you to our previous filings with the SEC for information regarding the significant assumptions underlying forward-looking statements and certain risks and other factors that could affect our future performance and ability to deliver on these statements. We undertake no obligation to update or revise any forward-looking statements made on this call, except as may be required by law. The fourth quarter stockholder letter and earnings release have been furnished or filed with the SEC and will be available on the SEC's EDGAR database in the US and on the SEDAR database in Canada, as well as on the Ceridian investor relations website at investors.ceridian.com. That concludes the statement. With that, I will turn the call over to David. David? Thanks, Erik, and hello, everyone. Thank you for joining the call today. Before we go into Q&A, I want to spend a few minutes on the highlights for the quarter. First, I'm very pleased to report that we closed 2021 with strong momentum and performance. Fourth quarter sales were well above pre-COVID levels, with continued momentum in both the size and volume of transactions. Professional services took live 207 customers in the quarter, representing a record value of recurring revenue activated in a single quarter. Customer satisfaction levels are record high and reflected in our industry-leading cloud retention rate of 96.8%, which has increased 1% year-over-year. Second, I want to celebrate two important milestones for the company. Total revenue was $1.024 billion, which exceeded the billion-dollar mark and exceeded our guidance. We also surpassed 5 million active employees on our Dayforce platform. Third, relating to our fourth quarter financial performance, I want to call out the following. Dayforce recurring revenue ex float grew by 32% year-over-year. Cloud recurring gross margin, excluding float, grew by 170 basis points year-over-year to 72.2%. Dayforce Wallet continues to be a differentiator for us and resonates very well with our customers. We continue to sell Wallet to 80% of new customers. Registration rates have increased quarter-over-quarter to 34% of eligible employees, which is up from 29% in Q3. We continue to see 50% for top quartile customers live for more than one year. We now have over 425 customers live versus 219 Q3, and have sold over 970 customers, up from 800 in Q3. The Dayforce Card continues to exhibit top wallet behavior, maintaining an average of more than 25 transactions per month across the user base. Looking ahead in 2022, we're providing the following guidance for the full year. Dayforce recurring revenue, excluding float, is expected to grow 26%-28% year-over-year, both on a GAAP and a constant currency basis. Adjusted EBITDA is expected to be in the range of $180 million-$195 million. For the first quarter of fiscal 2022, we're issuing the following guidance. Dayforce recurring revenue ex float is expected to grow 29%-31% year-over-year, and adjusted EBITDA is expected to be in the range of $41 million-$47 million. Before we get into the questions, I'm excited to welcome Leagh as co-CEO and as a member of our board of directors. Since joining Ceridian in 2018, Leagh has been instrumental in driving our growth and our strong execution throughout the company. At the same time, she has built a world-class team. Just looking at some of the numbers over the last three years, revenue has more than doubled. Gross margin on recurring has increased by 6.1%. Customer count has increased by almost 60%, while at the same time, average customer size has increased by more than 80%. In her expanded role, Leagh will continue to report to me and will continue to fully drive the end-to-end operations and strong execution that are fundamental to Ceridian's growth. To be clear, as I mentioned in the stockholder letter, I love Ceridian, and I'm not going anywhere. In fact, I've never been more excited about the future of this company. I will continue to focus on product innovation, driving new sales, and spending as much time as possible with customers and our employees. We believe this is what a modern future-focused company should look like, and I'm confident that my partnership with Leagh will lead to continued growth and success. Before we take questions, Leagh, could you say a few words of introduction? Yeah, of course, I can, David. First of all, a big thank you to you and a thank you to our board. I am really honored to continue the partnership that we've built over the last three years and to continue working with what is just an amazing team around the world as we continue to focus on the next wave of growth. Just to echo David's comments and his summary of the great quarter and the incredible year, I'll again say we saw really strong momentum across the entire business. We're operating really well across our strategic growth levers, which are the same they have been for the last three years. Acquiring new customers in our current markets, extending the Dayforce platform, expanding in the enterprise, accelerating global expansion, and continuing to drive incremental revenue in adjacent markets, as an example, Dayforce Wallet. What we saw closing out 2021 and now looking ahead to 2022 is that we're really executing against all five of those growth levers simultaneously. When we combine focused execution of this great team and the current market dynamics which are driving the future of work, we believe that we have incredible potential, and that we will continue to help our customers adapt and transform as we continue to build out our vision to be the always on people platform. Just as I have been for the last three years, I'm really excited about the potential of this business, about the partnerships that David and I have, and about our unbelievable leadership team and company that are aligned behind this vision, and, which serves to strengthen our value to our customers and increase their expectations of us as we continue to grow. With that, I will turn it back to David, and thank you very much. Thanks, Leagh, and congrats once again. Erik, let's get to Q&A please. Thanks, David. Thanks, Leagh. As we go through the Q&A portion of the call, I will announce the name of the equity analyst. At that point, we ask you to please unmute your line and ask your question. Then once you're finished asking, please remute your line so that we don't have any of the background noise. We also ask that you limit your time to one question and one follow-up. With that, the first question today comes from the line of Mark Marcon of Baird. Please go ahead, Mark. Hey, good afternoon, and congratulations on the great finish to the year. And Leagh, congratulations to you. Couple of questions. I mean, really impressive in terms of the wins and particularly the attach rate with regards to the Dayforce Wallet. One question that I you know continuously get from investors is, as you continue to see the penetration of the Dayforce Wallet, is there a way of framing like what sort of contribution one could expect from a revenue perspective as we start going out to 2022, 2023? How should we frame that? Because you're clearly seeing a lot of traction there. Yeah. Mark, it's a great question. Obviously it is a feature of the system that has helped us in our win rates, and I wouldn't understate the impact of that. In terms of revenue contribution this year, it's still gonna be largely minimal. At the end of the year, we'll start reporting out the numbers as it becomes a little bit more material to the overall business. As you can expect, at a $1 billion of revenue run rate, we need the revenue to get up there a little bit before we start reporting it out, as we don't report out each of the individual line items of our business. How important has it been in terms of, you know, achieving the wins that you're getting? I mean, clearly when we take a look at the average, the incremental revenue from the new clients. You're clearly succeeding in terms of going to enterprise clients, both domestically as well as internationally. How important is that relative to your class leading, you know, the workforce management systems always-on continuous calculation? One last element to that is, can you talk a little bit about the PRO Unlimited win? Because that's interesting in terms of, you know, basically offering the solution to their temps. Thank you. Right. There are a few pieces in there. Look, we've been very successful in selling the full suite to the new Dayforce customers. Approximately, in fact, more than 35% of new customers now buy the full suite. The Dayforce Wallet is a component of that, and as you pointed out, it really does illustrate the always-on payroll engine, which is very important to be able to deliver the instant wage access in a way that others can't do. It does differentiate and it does highlight, and it does increase our win rate quite substantially. The PRO Unlimited is very exciting because as you know, a good percentage of the workforce is contingent. This allows us now to extend the Dayforce Wallet to service those types of people as well, which we think is both beneficial for them and for the contingent workforce companies. If you read through the press release with PRO Unlimited, you can actually see how it differentiates them in market too. Thank you very much. Great. Thanks, Mark. Next up in the queue is Bryan Bergin from Cowen. Brian? All right, [Kyle]. Thank you. Leagh, let me echo my congratulations. First one, I wanted to weigh in on 2022 outlook for Dayforce growth. Can you give us a sense of the inorganic embedded assumption there? I know you're partially lapping Ascender in 1Q, but what do you expect for ADAM HCM? How should we think about where that business is gonna be included in Dayforce versus Bureau? Maybe talk a little bit about the integration of ADAM HCM as well. Let me start just with at a high level on Adam, and I'll hand it over to Noémie for the actual numbers. ADAM, as you know, allows us to accelerate the offering of a native solution to Mexico, which has significant importance with our North American manufacturing customers off the bat. ADAM also has a presence in Brazil, Latin America, and in the Caribbean. Over time, it will allow us to add even more native engines onto the Dayforce platform. In terms of the overall size, and again, Noémie will give more clarity, it's a relatively small business. It's not really gonna contribute to the actual Dayforce line or the overall revenue line. Noémie, do you wanna actually go through the numbers? Yeah. Maybe the best way to think about it is if you're looking at the incremental revenue from M&A in 2022, if you take the additional two months of Ascender, since you may remember that acquisition was effective as of March first, sorry. If you take those two additional months on ADAM, you get $2.01 billion of additional cloud revenue from that M&A versus 2021. Okay. Thank you for that. Just as it relates to growth investments, you know, can you speak to maybe the magnitude incremental investments across product sales, G&A? There's obviously a lot going on as you're going international and you're broadening the platform. Maybe give us a sense of the step up in spend that you're making that you've kind of projected within that margin outlook. Oh, go ahead, David. No, if I look at it from a product development management expense, in Q4 of 2020, we were at $26.2 million. We increased that to $39.8 million year over year. We took a step up from 11.8% of revenue to 14.1% of revenue, which is quite significant. Now, what we're obviously doing is we're focusing on durable growth of the company by building out the global capabilities. In 2022, we're launching nine new native payroll engines, and that obviously creates a nice market for us and an opportunity to go global. If you'd asked me the payoff that I would expect, I would expect that the global revenue will increase to about 25%, if not more, within two years. as we're growing the company out, I think that will further differentiate us. As I said, really, we're focusing on really durable growth for the business. Maybe if I can add a little bit of color on the investments for 2022. As you saw, we've guided adjusted EBITDA in the range of 15%-16% of revenue. Beyond investments in product for our global capabilities, as David mentioned, we're also investing in wallets with new features such as, you know, the cashback rewards, two-day early direct deposits. We're also planning to roll out in the U.K. later in the year. We're really committed to invest in our HCM platform. We're investing in user experience as well, design, platform extensibility. I'd say we're very successful also in attracting talent in P&T. I wanna highlight that because I think in a tight labor market, that's important and demonstrates the strength of our brand. On the cloud recurring gross margin, we expect continuous improvement. You saw the improvement that we've again showed in Q4. We're gonna be more efficient in our support organization through product automation as well as shifting some of the labor and people working on the support into our shared services center in APJ. We continue to invest in sales and marketing as well to accelerate our platform growth. We have quota-carrying productivity levels that are expected to be above pre-COVID levels in 2022, and we're also baking a bit of additional travel and in-person events. Okay. Thank you for all the detail. Great. Thank you, Bryan. Up next in the queue is Siti Panigrahi from Mizuho. Siti, over to you. All right, thanks for taking my question, and Leagh, extend my congratulations as well. When you joined and started this enterprise part of the business, wondering, you know, what are you seeing the trend on the enterprise side? It's good to see that average revenue for customer growth. I also understand that it's a longer sales cycle and implementation cycle as well. How should we think about current pipeline and the booking trend versus go live in 2022 versus 2021? Siti, in Q4, we actually saw quite a significant shift to enterprise and our large enterprise segments relative to 2020. Quite a nice step up. On the implementation side, if you actually go through the customer highlight section of the shareholder letter, what you'll see that stands out is that the examples that we've called out are all large enterprise. For example, we took live a leading managed care provider with about 50,000 employees. Just to put that in reference, we took them live in 7.5 months. Very, very successful implementation for quite a lot of employees. On the sales side, we had tremendous success with global accounts, as I mentioned, and many of them are called out in the shareholder letter as well. Leagh, anything that you would add with color about the success that we're having in the large enterprise and enterprise segments? I think I would just say the pipeline is greater than it's ever been. With the addition of Rocky and his wonderful management team, it's better qualified than it's ever been. As a result, we will continue to gain real momentum in this area of our business. Okay. Then follow up to international expansion, because that's one of the growth drivers for you guys unlike other payroll vendors. What percentage right now international represent, you know, as a percentage of revenue, and how do you think that grow in next few years? Right now we have about 14% of our total revenue that's outside of North America for 2021. As David said, as we're moving upmarket and selling to customers with presence outside of North America, we have a roadmap to get to a revenue range about 25% in the next three years. That's gonna take some time. We're investing heavily in building some new capabilities, including nine payroll countries going live next year, being released, sorry. That's going to help really accelerate the momentum around large enterprise and customers with presence outside of North America. The one thing that I actually would point out is not only are we going from about 14% to the 25% in the next few years, but remember that the 14% at the moment does include quite a lot of bureau revenue. We do expect to move that to the cloud as well over that period of time. If I look at international business as today, we have over 57 countries where we currently have native payroll solution, and the intent is to move all of those over onto the Dayforce engine over the next couple of years. David, if I may ask a follow-up to your statement. What sort of uplift do you see when you think of moving that bureau business of this acquired company to Dayforce? It's a several times multiple, multiplier, Siti. Specifically, we're going from payroll only to the full HCM suite. As you know, once you start loading in the core HR and the talent components and workforce management, the upsell potential there is quite significant. Great. Thank you. Great. Thank you, Siti. Appreciate the questions. Next up in the queue is Samad Samana from Jefferies. Samad? We can't hear you yet, Samad. 2020 will never end. Sorry, I was on mute on my phone line, not on the Zoom line. I will repeat the question. I wanna ask a follow-up question on the PRO Unlimited partnership more, because if I think about how do the economics through a partnership like that work versus doing Wallet directly? You know, should we think about there being more opportunities like this for Wallet to see distribution through partners versus Ceridian just selling it directly to customers? Yeah, first of all, with the partnership with PRO, there's two revenue streams for us. One is for Dayforce HCM platform. We get a healthy portion from that side. Then there's the interchange revenue that we get as well. We get both sides of it, if you like. When I look at the actual Wallet business, the next real area that we'll be focusing on is allowing people who do not work for Dayforce customers to register for the Wallet and use the Wallet for the early direct deposit, for the cashback types of capabilities. We do see the Wallet as being quite a nice platform play that we can also bring to life through our direct sales force, through partners like PRO, but also by going directly to the consumer. Is there a different type of risk? Is there any kind of risk underwriting element that's involved in that when you're doing it via a partnership, given that for your own customers, you can see what the payroll flows are? We have the same visibility when we look at PRO because remember, they also are a payroll customer. From a credit perspective, we actually do understand the business rather well. Great. Maybe just switching gears to the core business. When we think about the Dayforce recurring guide for 2022, I know the M&A contribution question was already asked. Can you remind us how much of the ending bureau revenue in 2021 has potential to be converted over to Dayforce as we think about maybe the last few acquisitions the company's done? Just what is maybe the TAM within bureau for conversion, and what does conversion uplift look like these days? Could you remind us? Yeah. If I look at Q4, bureau revenue total, $40.7 million. Ascender total, $23.3 million. Excelity, $7.5 million. The Legacy Payroll Bureau would be $4.1 million. Those are the components that would be able to flow over towards Dayforce. Typically, when we do those, especially on the Ascender and Excelity side, there is a big footprint expansion play. In fact, for those customers, we typically go in first with the Dayforce core HR and the HCM capabilities for the talent components. We actually look at activating the payroll through what we call Titanium, which is a headless pay payroll engine interface that we've developed over the last year or so. There is quite a nice significant uplift from that. That's kind of what I alluded to earlier in the call, that when I look at going from the 14% today, which largely has a large bureau component, that will move over to the cloud over the next few years, and I would expect that to multiply by several times. Great. Thanks so much for taking my questions. Great. Thanks, Samad. Up next, we have Matt Pfau from William Blair. Hey, guys. Nice end of the year, and thanks for taking my questions. I wanted to ask on the services and implementation side of your business, have you been able to hire and retain enough capacity? And then with your partners, have they been able to provide sufficient services and implementation capacity so that implementations haven't been a bottleneck for growth? No. Let me just preface this by saying in Q4, the implementations came in well ahead of plan. In fact, there was a slight adjustment to the recurring revenue true-up from a contract asset perspective, but they really did very nicely. We've had no issues at all on the hiring side or the retention side of the service component. As I mentioned, customer staff levels are at record levels. In addition, as you know, we started to make the transition, especially in the large enterprise side, to having SIs lead the implementation. That's actually gone nicely as well, and I'd expect that to accelerate into 2022. Leagh, could you add a little bit of color into the SI success and what we're seeing on the prime side of that? Yeah. The one thing I would note specifically is that when you look at the go lives in the shareholder letter, one of them in particular, Europe's largest veterinary care provider, based in the U.K. with eight practices now having gone live, 14,000 employees across HR, time and attendance, managed pay, was led primarily by a partner. We are seeing more and more of these examples in our go lives, whether those that have actually gone live or those that are in queue to go live. What we're seeing is significant lift for our own services organization, and frankly, better support for our customers globally over the long term. Great. Just to follow up, sticking with your workforce, it was mentioned that you did make some adjustments in terms of realigning your global workforce. Maybe you could just give us a little bit more detail on what you did there. This is the final stages of the integration. As you know, we did the acquisitions of Excelity and Ascender over the last year. With that, we got a number of global services offices that had very high service levels. What you really are seeing is a rebalancing of the workforce on a global basis with the shift of certain roles from North America to our global offices. From a headcount perspective, there's no real change, but it's just a moving across geographies. Great. Thanks, guys. Appreciate it. Thanks, Matthew. Up next, we've got Michael Turrin from Wells Fargo. Hey there. I hope everyone can see me. I empathize with Samad and what he just went through. Maybe since it hasn't been asked, it's a good time, David, just to talk through the evolution of the leadership structure. I think it's pretty clear in the letter you're communicating you're in it for the long haul, but this is the right time to start to think about just sharing some responsibilities. Maybe you can just talk about, or both of you can talk about what this frees up and how this change could be additive to the overall executive team. Thank you. The first thing, Michael, is that this really is formalizing the way we run the business and have run the business over the last number of years, where I really focus on the innovation, so product side. I focus on key customers, whether it be during the sales cycle or whether it be during implementation. I spend a lot of time with our customers through events like INSIGHTS, and I also spend a lot of time going to our offices and spending time with employees through various types of town halls and the like. As you know, I think I excel with that, and I think it's quite a good, you know, it's an area that really does benefit the organization. Leigh is spectacular at operations, at running the end-to-end of the business. She's been also very successful at bringing in an unbelievable management team, while at the same time, she's also lifted up our existing people as well. This allows us really to focus on that durable growth component, which allows us to build a team that knows how to operate at scale, that operates as one team, so, and from an end-to-end perspective. Leagh also is a very competent sales expert, so her strategies on sales and sales execution are probably unmatched in the industry as well. So for me, it is really tremendous. It allows me to continue focusing on areas that I excel, and it allows us to continue leveraging Leagh in ways that have really helped the company. Leagh, maybe just add some color from your perspective. Yeah, I mean, I think you said it. To me, it's largely the formalization of how things have been working. I hope that you read it for what it is, which is, it's a real one plus one equals three in that we have a world-class innovator and founder in David. He gets to do even more of what he's already done, spend more time with our customers and our prospects, which is a winning combination. We get to leverage this fantastic management team who has experience driving growth at scale globally. Those two things are wonderful, and I'm just grateful to be a part of it. As I said, it's really not a significant change inside the four walls of the business. Great. Thank you. Noémie, just in framing the full year guide, there are still some macro assumptions, still some moving pieces. You've talked about employment headwinds, but the employee number looks like it grew 21% over the course of the year. Can you just, in the context of the EBITDA guide, kind of step through employment assumptions, rates, some of the rebalancing efforts that have come up on the call and just provide some additional context? For those of us on the call? Thank you. Absolutely. In terms of Dayforce recurring exclude for 2022, we don't expect any significant impact from the employment levels from COVID. I think we're done, and we're back to pre-COVID level. You may recall we had about $17 million of impact in 2021, which was primarily in the first half of 2021. We're done with that, and we're not going to talk about employment levels from COVID in 2022. As I mentioned, we have a bit of M&A incremental contribution below $10 million, related primarily to the 2 months of additional Ascender revenue. And those are really the main items, and obviously the revenue from the previous sales and the significant Q4 go live that we just had. Thank you. All right. Thank you, Michael. Up next, we've got Arvind Ramnani from Piper Sandler. Arvind? Hi. Hey, thanks for taking my questions. You know, I just wanted to really get a better understanding of your guidance, right? I'm just trying to get some estimate of how much is your wallet part of your next year's guidance. Is it like, you know, closer to 1%? Is it closer to 5% in terms of the 2023 guide? Or if you're not able to provide that, how much of it was it as part of your FY 2022 numbers? Noémie, do you wanna take that? Yeah. We said we would start disclosing a number towards the back half of 2022. It's not mature enough for us to disclose that now. That's where we'll leave it there for now and provide more color as we increase our registration rates throughout the year as well. Okay, great. Just on this guidance, you know, what was the rationale for including rate hikes in the guide? I mean, we have some sort of sense of where rate hikes w as there a reason to sort of really include them in the Yeah. In terms of float for 2022, we expect a modest improvement from what it was in 2021, which is primarily driven by increased float balances. You saw in Q4 our float balances have increased significantly by 28% as a result of higher employment levels and simply as a result of macro improvements. That's really what's going to drive the slight increase in float for 2022. We don't expect the overall yield to be up from 2021. Actually, it's gonna be slightly down still, which is a factor of our investment strategy. As you may recall, we have about 55% of our investments which are held in short liquidity portfolio. Those reprice immediately at a higher yield with a month lag or so. The rest of the portfolio is held into income, which reprices a lot more, very much, much more slowly. You won't see a real improvement from yield in 2022. Great. Then just one last question on margins. You know, certainly margins declined about 160 basis points sequentially or 120 basis points year-over-year. Can you just give us some color on some of the puts and takes on kind of what's going on with margins? In Q4, our adjusted EBITDA was higher than our guidance by about $1 million, which is primarily driven by higher revenue. We, as David referred to, exceeded revenue in professional services. We had record go lives, record number of people going live. This incremental revenue doesn't yield additional margin, so that's kind of a mix of revenue that you see here in Q4. We've continued to make some investments as well in product technology and sales and marketing, and we'll continue to do that in 2022. As I said before, we have product and technology in wallet. We're rolling out Dayforce Payroll in 9 new countries in 2022, and we're also continuing to invest in sales and marketing. Thank you. Great. Thanks, Arvind. Next up, we have Robert Simmons from D.A. Davidson. Robert. Hey. Thanks. Same question. How commonly are you able to charge PEPPM upon provisioning nowadays? Like, how much pushback are you getting to it from customers? Have you needed to give any kind of discounts or other concessions to win that kind of arrangement? I think it's actually been quite successful. We saw a significant step up between 2020 and 2021, and we're expecting a similar type of step up between 2021 and 2022. The first part of this is that we had to really teach our sellers on how to position PEPM on provisioning, which is, quite honestly, the norm for most cloud companies. I think we've done that obviously through the sales leadership team, and it's turned out to be very well. In some instances, yes, we do make some concessions, but we still are being very, very successful on getting the PEPM provisioning. Leagh, what would you add to that? I think I would add two things. The first is, I think that the market is now well conditioned, so we're not facing the same obstacles that we may have faced a year or eighteen months ago. The second is, to David's point, our sales organization is now totally fluent in the value proposition of software, versus selling on go live, which allows us to accelerate our growth through partnerships and through our own team. One thing that I would add, PEPM on provisioning is a prerequisite for SI enablement. They go hand in hand together. That's why I think we've seen the success that we have on the SI side. Got it. What are your expectations for further M&A in the near term? Do you digest recent deals, or do you think you have capacity for more, you know, other than small buckets? Look, we did four acquisitions in 2021. In terms of the acquisitions, there already have been two flavors to date. One is to allow us to accelerate the growth on global, which has been consistent with the messaging we had at time of IPO back in 2018, which again, is a copy of what the Apax did with Ceridian back in 2013. We know the model works very well. We acquire payroll revenue, customers, knowledge, equity, a discount, and then we very quickly build out the native capability, move the customers across and upsell them on the HCM capabilities. That's important as well as we go up market. As was mentioned, our success rate up market is because we are differentiated on the global side, which is a base requirement for any company that probably has more than 500 employees. Leagh, anything that you would add to this? Nope. I wouldn't add anything, David. You said it well. Great. Thank you very much. Thanks, Robert. Appreciate the questions. Next up is, Pinjalim Bora from JP Morgan. Great. Thank you. Just sitting in for Mark Murphy here. Thanks for taking my questions. Leagh, congrats on the new role. David, I wanted to ask you a little bit of a high-level question on multi-country or native payroll. You have added a lot of capabilities. You said nine going live, Excelity on the APJ side and the new one, ADAM HCM adds on the Latin side. I saw a lot of big logos being added, 73,000, 50,000, if I read that correctly. Is it fair to say that multi-country kind of native payroll capabilities are surfacing to the top as an important kind of a point that's kind of differentiating you competitively when you're going against the Workday and Oracle and SAP of the world? I think that's very true. If you look at us from a Gartner perspective, we rank number one for payroll and obviously for workforce management. They go hand in hand in that capability. What I would say is that in a post-COVID world, companies have become much more global in nature. There's much less of a reliance on where head office is and, you know, concentration of people. You're seeing companies, we're a perfect example of that, with the rebalancing of our workforce across our global offices. It allows us to navigate the tight labor market by taking advantage of the people that are available across the world, and other large companies are doing exactly the same thing. It's also very important in today's world where you are seeing wage inflation. If you look at Noémie's numbers, float balances went up by 28%, employee count went up by 20%. If you do the basic math, that's your wage inflation that's out in the actual market. If I'm planning out my global workforce, I need to look at what is my local labor rate on a geographic basis in order to make ends meet and to hit the EBITDA targets that I'm looking for. Very similar to what we're doing internally in that we want to increase our gross margin on recurring. Well, hey, we can do that by leveraging our global offices to increase our contribution margin on our recurring revenue. Yes, it's definitely becoming a big piece. The other component, I would say, is not just payroll and time, it's actually core HR and talent as well. The same type of thinking goes into talent acquisition, the development, learning management. In order to grow a company globally, you have to have a consistent set of values. You have to have consistent ways of doing performance management and creating true equity across your organization. A company like ours has products that help that. We have constructs like a global system of employment that allows someone to move across country. Very important. If you look at some of the business intelligence features that we've launched, it's all about the same. Got it. Very, very helpful. Thank you. Just to follow up on sales hiring, given the kind of the tight labor market that everybody's talking about, the great resignation and all that, how do you characterize your kind of sales hiring cadence so far in 2021, I guess? As you look forward into 2022, how are you thinking about the sales headcount growth? In 2021, we did a lot of lifting up of our sales organization, which really came from a change of leadership inside the organization. As we discussed previously, we needed to sell as a software company, not as a service company, and that required a change of behavior like that one on provisioning, selling alongside the SI, selling to the large enterprise and enterprise market. I think we did that transition very successfully. You can see that in the results that we had. Q4 was tremendous. Leagh spoke about the pipeline, and she mentioned two qualities of the pipeline. She said, first of all, it's at record levels. As important, it's more qualified than it ever has been beforehand as well. We've done that. I think we've brought in just unbelievable sales talent over the last year. This year, there'll be less, a change, obviously, to the sales organization because I think we have, the base, and it's performing very nicely. Obviously, you'll see the regular performance management of the sales team as you would expect in any organization that is typically done at the beginning of the year before you do sales kickoff. Right. Got it. Thank you for taking our questions. Thank you. Next up, we've got Ryan Krieger on for Alex Zukin from Wolfe. Ryan? Yeah. Thank you for taking the question. Just to kind of continue on that same sales topic, can you just talk about how, like, sales force productivity is right now and how it compares to pre-COVID levels? Well, again, I think we've had a fantastic Q4. We did quite nicely last year on the sales side as well. Leagh, do you want to take it from a productivity perspective on what you would expect in 2022? Yeah. I mean, I'll just say a few things. Sales productivity is directly correlated to your ability to generate pipeline, your ability to qualify it, and your ability to deliver it predictably. To David's point, we spent 2021 hiring what is an exceptional sales leadership team. They tuned the sales organization so that we could take advantage of the market. They did, and the result was exceptional in Q4 and for the full year. It's our expectation that we will be able to continue to deliver the results that you're seeing. What you're seeing is increasingly large customers, global customers, our performance in every region, and our ability, frankly, to sell the full suite to increasingly large customers. I think you should expect us to continue to really press in and do that. Thank you very much. Great. Thanks, Ryan. Next up is Bhavin Shah from Deutsche Bank. Bhavin? Great. Thanks for taking my questions, and congrats to you, Leagh. David, I know you spoke a little bit about this in your shareholder letter, but maybe can you elaborate on the demand environment and if anything is changing in terms of just given the labor market? And then maybe can you also just touch on any changes in the competitive landscape given a high-profile security incident that happened recently? On the competitive side, I would say that our win rates have increased quite substantially year-over-year. I do believe when it comes to the upper end of major markets and into the enterprise space, we have the best product in market, and that's shown in our results, and I would expect us to dominate that particular segment. We also saw significant movement into large enterprise space, especially in the second half of the year, as you know, those evaluations take a bit longer. So I think that's actually going very nicely. Pipeline record levels, best qualified pipeline that we've had to date, and so we're confident on the sales this year. Let me hand it over to Leagh again. Sorry, David. I was trying to get off mute to say nothing. I think you said exactly what I would have said. Awesome. Just a quick follow-up for, from Noémie. I know you talked about float not being a material impact this year, but to the extent we get further rate increases versus the 50 basis points that you have kind of projected into 2022, what's your philosophy on letting that additional profitability drop to the bottom line versus kind of reinvesting that back into the business? Yeah, that's a good question. First of all, on float, what I said is, there's gonna be a timeline before those rate increase really translate into additional revenue, because of our investment portfolio strategy. In terms of sensitivity analysis, another data point that I wanna give you is we've said that, float revenue would increase by about $23 million over a twelve-month period if market yields change by 100 basis points. So that's another data point to give you an idea of how the long-term effect of rate hikes can have on our float income. In terms of what if we get some additional upsides in the year, obviously, we'll be looking at reinvesting that for the most part in our growth. We also have a lot of things to go after in terms of investment initiatives with the wallet, as I said, with the global payroll capabilities, as well as additional quota carrier to go after pipeline. Quite frankly, if there's a lot of pipeline to go after, we'll certainly go after it. We'll also try to improve our gross margin. Cloud recurring gross margin will continue to improve. We've seen that we can do that over and over. Each quarter, we've seen sequential improvement of our cloud recurring gross margin. That's going to be a long-term profitability driver for us. That's what we're gonna go after for 2022. One thing, if you look at the shareholder letter on page 12, we outline that quite clearly. We've assumed that there are gonna be two 25 basis points increases in both the Fed rate and the Canadian bank rate in March, end of June. As Noémie mentioned, each 100 basis points amounts to about $23 million of both revenue and EBITDA. Perfect. Thanks for taking my question. Great. Thank you. Next up on the queue is Raimo Lenschow from Barclays. Raimo? Hey, thanks for squeezing me in. I have two questions. First one is, as David and Leagh, if I look at the improvement in pipeline coverage, et cetera, how much of that is driven by you offering payroll and workforce, and some of the industries that are coming back now post-pandemic kind of are much more suited, you know, or like, you know, good fits for you. In that respect, you know, we could see this as a multi-quarter situation that, you know, post-pandemic people are starting to look at these areas again, and you are kind of actually a very good fit in there. That's the first question. The second question, David, on the wallet side, what do you see in terms of competitive reaction? Because you're obviously the only one that can offer it because you have the continuous payroll and drive it out of your system. But it's a competitive advantage, and other guys will likely try to kind of say, "Oh, I can do something similar," but they need to have some roundabout solution around that. What do you see in terms of reaction there in the market towards that differentiation factor? Thank you. I'm gonna start with the second part of the question, and then hand it off to Leagh for the first part of the question. On the wallet side, we are seeing the competitors launch similar types of products, but those products, as you know, are built on tech, which makes the reconciliation at the end of the pay period very, very difficult. In all cases, the major difference is we don't require an agreement between the wallet holder and us. We only have an agreement with the employer, and then the wallet, as you know, is free effectively for the employee to use in all regards. We don't charge any membership fees or interest rates and such. The other companies can do early wage access, which is effectively a loan. They can do early direct deposit, which as you know, we do quite well, as well. But they can't do the streaming of pay, which is really where the industry is going to end up. As I said, it has had a nice impact on the win rates with our customers. In terms of your first question, before I hand it over to Leagh, we are being very successful on the talent side as well. Over 35% of our new customers are buying the full suite. We're seeing a significant lift up in the pattern that we're getting from the actual clients. Leagh, do you wanna speak a bit more about the impact that the economy coming back and our strength and our differentiation, quite honestly, in payroll, time and attendance, workforce management is having? Yeah. I mean, I think it all begins with the market. As David said earlier, every single employer in the world is wrestling with the change in market dynamics. The globalization, the fact that employees wanna work in a distributed way, the fact that they need to continue to grow culture in a distributed fashion. These are all phenomena, frankly, that every employer is facing. As a result, they're turning to companies like us in order to be able to support them, which is evidenced in our pipeline, and frankly, in our results. We have an opportunity really to do two things. We have an opportunity to go in and sell a full human capital management suite. You would see us doing it. There's examples in the shareholder letter of an Australian company with 9,500 employees, operating across the region, that bought full human capital management from us. At the same time, we have the opportunity to be able to go in and plant a wedge, as is the case in some of our largest North American and global go lives, and then expand from there. As David noted earlier, we're seeing massive traction by going back and selling back into the base over time, now 31% of revenue. We will continue to do that. Congratulations. Thank you and good luck. Thank you. Thank you. Next up is Dan Jester from BMO. Dan. Great. Good afternoon. Thanks for taking my question. David, on the Wallet, could you just help us think about the global journey here? Obviously, U.S., Canada, U.K. is coming this year. How should we be thinking about the pace in which you're gonna be able to use the Wallet globally? Do you need to have a native payroll engine in the country before you launch it? Just help us think about sort of the medium-term trajectory there. Thanks, Dan. Yeah, we launched in the Wallet in the U.K. this year. That'll be followed by Australia and New Zealand next year. We'll take it from there as we bring on the other nine native payroll engines, so going into kind of more of the APJ type of market as well. There's a slight difference in the financial model as well. As you know, we have interchange in the U.S. and Canada. It drops down quite significantly when we go into the U.K. market. When you go into kind of the Australia market and such, it almost disappears. There'll be a different pricing model that we'll use for the Wallet in those geos. Great. If I remember when we, you were introducing the Wallet a few years back, I think one of the things that was really exciting is that employees could take the Wallet with them if they changed employers. Given the churn that we've seen in the labor market over the year, I know it's pretty early, but are you seeing examples of customers or employees, when they change jobs, take the Wallet and use the Wallet at the new employer? Thank you. Yeah, Dan, we actually are seeing some of that, and I mentioned that a little bit earlier in terms of where we're taking the Wallet next, not only on a global basis, but the construct of being able to download the Wallet application irrespective of who your employer is and to use it for early direct deposit, for the cash reward program that we have in place at the moment, and the financial wellness offerings that we'll be bringing onto the Wallet as well this year. That is very much part of the strategy. Great. Thank you very much. Great. Thank you. That actually concludes our questions for this evening. I wanna thank everyone for attending and really look forward to the discussion throughout the rest of the quarter and throughout 2022. Good night. Thanks, everyone. Bye, everyone.