Thank you. I would now like to turn the conference over to Peter Welburn, Vice President of Corporate Development and Investor Relations. You may begin. Thanks, Jeannie. Good morning, everyone, and welcome to Pegasystems Q1 2024 earnings call. Before we begin, I would like to read our Safe Harbor Statement. Certain statements contained in this presentation may be construed as forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. The words expects, anticipates, intends, plans, believes, will, could, should, estimates, may, forecasts, and guidance, or variations of such words and other similar expressions, identify forward-looking statements which speak only as of the date the statement was made and are based on current expectations and assumptions. Because such statements deal with future events, they are subject to various risks and uncertainties. Actual results for fiscal year 2024 and beyond could differ materially from the company's current expectations. Factors that could cause the company's results to differ materially from those expressed in forward-looking statements are contained in the company's press release announcing its Q1 2024 results and in the company's filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31st, 2023, and in other recent filings with the Securities and Exchange Commission. Investors are cautioned not to place undue reliance on such forward-looking statements, and there are no assurances that the matters contained in such statements will be achieved. Although subsequent events may cause our views to change, except as required by applicable law, we do not undertake and specifically disclaim any obligations to publicly update or revise these forward-looking statements, whether as the result of new information, future events, or otherwise. With that, I will turn the call over to Alan Trefler, Founder and CEO of Pegasystems. Thank you, Peter, and thank you to all who have joined today's call. We're off to a strong start in 2024. Our results reinforce the soundness of our go-to-market strategy, and we continue to improve execution, resulting in strong cash flow and significant expansion of Pega Cloud gross margins. This quarter, we continue to grow by deepening and expanding client engagement throughout our target account model and to drive our GenAI strategy forward with significant new and enhanced technology. The reactions we're seeing from clients as they begin to experience and fully understand the potential impact of Pega GenAI is tremendous. It's opened up whole new avenues for collaboration between us, our clients, and our partners, as well as inside our client organizations across their teams and functions. I'm even more excited than when we last talked about the incredible opportunity to leverage Gen AI to drive success in 2024 and beyond for Pega and for our clients. Now, to talk about the strategy, as a reminder, when we apply Gen AI, we're not using it to generate code. We're using it to optimize the business outcomes and best practices that our customers are able to follow. Our unique technical structure is built around business concepts and enterprises' processes, their rules, data models, UI, all organized into layers that can be built on and reused. It's turned out that this is a perfect architecture for Gen AI, and I think it gives Pega a unique advantage because we directly author, enhance, and optimize the business concepts themselves in a way that both business and IT can understand and collaborate on. It's a patented architecture underneath it all that I don't think can be readily copied or reproduced. Now, you may remember on our last call, I talked about the major areas where we believe our unique approach to Gen AI will drive massive impacts for our clients and for us, delivering solutions that will first double developer productivity and bring Pega skills to the fingertips of our customers that will ignite enterprise innovation through a blend of industry expertise, Pega expertise, Pega technology, and client insights that will maximize revenue and efficiency with real-time optimization and personalization of customer interactions, and will streamline work processes and customer experiences by giving the right people instant access not just to real-time enterprise knowledge, but to the processes that are necessary to get the results they want. We've continued to deliver on that strategy to help our clients unlock business-transforming outcomes. This amazing technology will be showcased at PegaWorld in our 10,000 sq ft I nnovation Hub, featuring more than 200 interactive demos that will be showing off the latest in the AI advances and how it will drive the future. It's an experience you can only have if you're there in person. Now, here are just a few highlights of the newest technology you'll see and hear at PegaWorld. First, we announced Pega GenAI Blueprint in mid-February and began immediately testing it with partners and clients, and we've now made it available to anyone who wants to use it since late March, whether you're a Pega client or not. All you have to do is go search on Pega for Pega Blueprint, and you'll find our website really just has everything you need to get started. You can be up and running in minutes. I think that no other competitor has anything that can do what we do, and we think it's a major competitive advantage. In the last month, hundreds of clients have generated thousands of blueprints. Together, we, our clients, and our partners are finding new ways to leverage this technology every day and stretching the boundaries of what's possible. Based on user feedback, we're enhancing it continuously, and because it's a SaaS application, we're releasing new versions every 1-2 weeks. In just the last few weeks, for example, we added new capabilities that allow you to import blueprints directly into a Pega application to allow you to really do game-changing work in seconds that otherwise would have taken weeks. And this enables people to iterate on application requirements and regenerate blueprints as they have new ideas and experience what's going on in their collaborative efforts. Now, more enhancements are planned in the coming weeks and months, and as more clients and partners use it, we're getting a stream of additional ideas that are both being met with great excitement by the partners and customers and great excitement by us. For example, we think that we're seeing many customers looking to use Blueprint to be able to rethink and to modernize their legacy estate. These are large collections of often ancient applications that all customers want to try to drive down in terms of complexity and quantity. Blueprint makes envisioning and designing for the replacement of legacy apps a completely different experience. It incorporates design thinking and best practices from both Pega and the internet, integrates them, and uses GenAI to synthesize the information and make recommendations on how they can improve. This is where our use of GenAI, I believe, is truly groundbreaking, as we allow enterprises to explore entirely new ways of envisioning their business processes, building on what is known on the internet and what we have done over our decades of experience, making it dramatically easier to align business and IT. We think it's a great opportunity for us, and we'll be talking much more about it at PegaWorld. Now, in addition to Blueprint, we continue to introduce and enhance our Infinity suite of solutions. Last week, we launched Infinity '24.1 with transformative capabilities to help our clients become self-optimizing enterprises. Incorporating enterprise-grade AI and automation, this newest release empowers organizations to optimize service, sales, marketing, and their business operations with new capabilities, including the Pega GenAI Knowledge Buddy, which helps users synthesize knowledge scattered across content libraries to quickly answer employees' and customer questions. There are hundreds of thousands of chatbots out there these days. Everybody has a couple of chatbots, but they don't include the kind of robust enterprise-based capabilities organizations need to audit what's going on, provide the right security, the right control, and be able to have confidence in the answers. That's what we focus our Knowledge Buddy on. We're also introducing the Pega GenAI Coach, which serves as a real-time mentor, analyzing employee workflows and providing actionable insights to optimize productivity. We have new accelerator bundles, what we call Pega GenAI Automate and Pega GenAI Analyze, which surface and summarize insights about cases, data, meetings, conversations to make it easier and faster for salespeople and service agents to follow up and engage with prospects and customers, as well as many, many other enhancements. We see a terrific long-term growth opportunity as these capabilities are the ones that are coming, help clients adopt our software more quickly, and find new use cases for Pega. Now, I've talked about PegaWorld a bit, and I want you to really consider strongly coming to Las Vegas and joining us because it is going to be terrific. As exciting as the new product announcements we'll be showing are, what really separates PegaWorld from many other tech conferences are the incredible real-world, very, very deep examples of how our clients are using the software that they themselves bring to the PegaWorld and talk about them in ways that, well, candidly, we couldn't talk about them because we have to maintain our clients' confidentiality. But when they get up and speak about it, we think it's wonderful, and we are honored that they're willing to discuss some of the amazing things that they're doing. Some of the customers who are coming will be, for example, T-Mobile, who will talk about their focus on customer centricity, the customer service overhaul that not just led to improved efficiency, but massively improved customer satisfaction, and how AI-driven insights are empowering their frontline staff to build stronger relationships. They'll also talk about the key success metrics that they've achieved and provide insights into their ambitious AI plans. Booking.com will describe how they're leveraging Pega capabilities to meet evolving traveler needs while also maintaining their super high customer satisfaction levels. Pega supports their customer-centric approach, ensuring that thousands of agents around the globe can deliver unparalleled experiences to travelers worldwide. National Australia Bank will explain how they're bringing together the left brain of analytics and the right brain of creative thinking to build real relationship-led personal experiences relevant in the moment at any channel. They have a fascinating story about how the blend of data, creative experimentation, and Pega technology are disrupting conventional approaches to communications and how they've used this to deliver 91 million customer engagements and a 40% increase in customer successful engagements in just over a year. Finally, just to pick another one, the Department of Veterans Affairs will discuss how they're modernizing their benefits program for veterans, spouses, children, and caregivers to improve responsiveness in this essential program. As a reminder, we've scheduled our investor session for Monday, June 10th. Local time is noon, and we are hoping to see you there. You should have received your invite by now. If you haven't, let us know and be sure to register. It's going to be a fabulous event. So, in summary, our go-to-market strategy and focused model are deepening relationships and driving good results, including a healthy balance of growth and profitability. We continue to focus on leveraging the latest GenAI capabilities to deliver advantages to our clients. Pega has been through massive technology transitions through our 40-year history. We've done five complete rearchitectures of what we've done, and I believe we are perfectly positioned to incorporate GenAI into the architecture we have and the way that we're going to deliver for our clients. This experience of being able to manage through and well in extreme change of the technical environments is, I think, one of the reasons that GenAI is going to be especially advantageous to us. Our newest offerings are truly enhancing the relationships with our customers and our clients' relationships with their customers. I think we have a huge opportunity to drive success in 2024 and beyond, and it's going to be very transformative. Now, to provide color on our financial results, let me turn it over to our COO and CFO, Ken Stillwell. Thanks, Alan. I'm very excited about our start to 2024. Annual contract value, or ACV, increased 9% year-over-year, which is where we thought it would be in Q1. As I explained on our last earnings call, ACV growth faced a tough year-over-year compare in the first quarter of 2024 because the net ACV add in Q1 of 2023 was unusually strong. As a result, we knew the ACV growth rate would be at the lowest point as the year began. Pega Cloud drove the majority of net new ACV add in the first quarter, and Pega Cloud ACV, which is approaching $600 million, continues to be the largest and fastest-growing portion of ACV. Moving to free cash flow, when we started our subscription transition in late 2017, we knew the transition would, over time, result in more predictable subscription billings and free cash flow. Now that the transition is complete, it's great to see that vision become reality. We generated $180 million of free cash flow in the first quarter, a record by far for any quarter in the history of the company. Our strong free cash flow performance was driven primarily by three factors. First, ACV grew by about $100 million year-over-year. ACV is a strong proxy for subscription billings, so an increase in ACV will naturally drive a material increase in subscription billings. Second, we're doing really well on our cost management initiatives, which improved operating leverage again in the quarter. For example, sales and marketing expenses decreased by about 15% year-over-year in the first quarter of 2024 versus the same period one year ago. Third, many of our deals close and renew in the last quarter of the year, which means collections often occur through the first quarter of the year. Our fast start on free cash flow generation may be a little surprising to many of you, and it's, quite frankly, a little better than we had even expected. But naturally, starting off strong gives us that much more confidence in our progress to improve margins and our cash flow momentum. Moving on to margins, Pega Cloud gross margin increased to 77%, a 500 basis point increase from a year ago, and that's just awesome to see the continued improvement. The improvement was driven by three factors. First, the increasing scale of Pega Cloud, which grew 21% year-over-year to $131 million in revenue in Q1. Second, more active planning and management of our global cloud capacity to optimize performance and to reduce cost. Third, an increasing use of Kubernetes for cloud scalability and efficiency. Now that we've released Pega GenAI Blueprint in Q1, I'd like to share some thoughts on the timing of GenAI monetization. In 2024, we expect Pega GenAI Blueprint will both change the way we engage with our clients and also decrease the time it takes for clients to envision and build new applications on the Pega Platform. We're already seeing evidence of that. Though we're still in the early days of GenAI, we can see that this innovation is going to be central to our clients' buying decisions, and it beautifully complements the statistical AI that we've delivered for decades. We expected GenAI would be central to our products as we put our 2024 plan together, and that's what we're seeing. Thus, monetization will be as a result of improvements in the selling cycle, which we believe will be fully realized in 2025. I've received feedback that it's helpful when I provide thoughts on modeling our business, so today I'll continue to share some insights. First, we expect our ACV bookings will be more back-end loaded this year, and the majority of our subscription billings will occur in Q1 and Q4. So for the full year, we expect our cash flow to be strongest in the first and the last quarters of the year. Second, our sales and marketing expenses are slightly higher in the second quarter as a result of PegaWorld cost, our annual client conference, which occurs in June. Third, we expect term license revenue will decline year-over-year in 2024 as Pega Cloud continues to become an increasingly larger portion of our overall business, and this is certainly connected to GenAI momentum. As cloud accelerates, an increasingly smaller part of our growth is coming from subscription revenue, subscription license revenue, excuse me, which is term, and maintenance revenue. Both of those are expected to continue to decline as a percentage of our revenue, and also subscription license, i.e., term revenue, is going to decline year-over-year. In fact, term license revenue will likely be less than 25% of our full-year revenue, and it will be back-end loaded. But that's okay because it doesn't impact cash flow timing, and we'll gladly trade term license revenue variability and decline for having a business accelerate faster to the cloud. Turning to our capital structure, as many of you are aware, we have about $500 million of remaining outstanding convertible debt at 0.75% interest rate that matures in March of 2025. We continue to evaluate alternatives, but at the end of Q1, our total cash and investments balance was about $619 million. So we are now at a net cash positive position when factoring in payoff of the convert. We are still waiting for the opinion from the Virginia Appeals Court. We don't know when that court will issue an opinion, but of the cases our panel of judges has heard, the majority of those cases have been decided. I also would like to provide you with a brief update on the shareholder class action suit that was filed in 2022. We reached an agreement to resolve that shareholder suit for $35 million. We look forward to putting that distraction and the associated legal fees behind us. I'm looking forward to seeing all of you at Pega World, which is being held at the MGM Grand in Las Vegas again and starts on Sunday, June 9th. We'll hold our investor session, as Alan mentioned, on Monday, June 10th at lunchtime. To register for the investor session, please email pegainvestorrelations@pega.com or reach out to Peter Welburn. Featured speakers during our investor session will include our founder and CEO, Alan Trefler, as well as other members of our senior leadership team. We will provide updates on our long-term strategy, our latest product innovation, and our go-to-market approach. In conclusion, I feel really, really great about running a sound business. Our strong cash generation in Q1 demonstrates the power of a SaaS business, and we're in a great position to accelerate our profitable growth from here. Operator, please open the line for questions. Thank you. The floor is now open for questions. If you have dialed in and would like to ask a question, please press star one on your telephone keypad to raise your hand to join the queue. If you would like to withdraw your question, simply press star one again. If you are called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Your first question comes from the line of Raimo Lenschow with Barclays. Please go ahead. Thank you. Congrats from me. I have two quick questions. One, Alan, for you, or maybe it's actually for both of you. If you think about the monetization, so if I understand you correctly, it's going to accelerate client adoption of Pega quite nicely. Is that kind of the main thing we should think about, monetization, or are there also kind of SKUs that have more AI versus less AI that could kind of drive monetization there? So that's question one. Question two would be for Ken. On the cash flow, you obviously gave us last quarter an annual cash flow idea with a very strong Q1. Was there some timings that helped you, or how do you feel about the full-year number? Thank you. So we're permeating our products with GenAI so that this is really becoming something that I think is going to be a reason that people say, "Boy, we can get this to work faster, better, cheaper, and more broadly in the organizations." And that's the way we monetize things. And if you want to get a feel for that, just try Blueprint. It makes perfect sense to you in two minutes. Ken? Yeah. On the question about annual cash flow, I think that's probably a very common question that's on the minds of lots of people listening to this call that's our result. So it's a great question. I'm generalizing a bit, but if you think about Q1 and Q4 being big cash collection quarters and Q2 and Q3 being more subdued and, quite frankly, not significant cash generation, to get more than half of your full-year target in the first quarter is certainly a great start. I wouldn't go as far as to say that changes our view for the year. I would say what that does is really reinforce the momentum that we're on and the confidence that we have for the full year. But it's great. Naturally, you always want cash flow as soon as you can get it in the year. But it was expected that Q1 and Q4 would be bigger collection quarters. Okay. Perfect. Thank you. Your next question comes from the line of Kevin Kumar with Goldman Sachs. Please go ahead. Hi. Thanks for taking my questions. I wanted to touch on Blueprint. It appears that interest is pretty strong there, and I've gone on and demoed it as well, and it looks great. Alan, just curious about, I guess, the second-order impacts of just being able to speed up the design process with Blueprint. Are you seeing any early indications that this could drive more applications being developed on the platform? Yeah, we are. I mean, we're seeing an enormous interest from clients and from partners, and we see Blueprints being included now in RFP responses and in bids that are going to customers. So I think it's a big step forward, and it's candidly a step that's only going to get bigger as we continue to add in some of the features that are planned for even now to Pega World. So we're really, really seeing concrete uses with clients. I also think this opens the door to Pega being seen as an engine for legacy transformation. We talk to people in the tech world who have literally thousands of applications, and being able to use a technology like this that helps take them out faster and better, get rid of some of that technical debt, hook them all together in what we call a Process Fabric, which is a technology we've talked about in the past that lets you have multiple Pega apps that act as one. I think it's a very appealing message, even in its early days. So we're pretty jazzed about this. That's great. And then, Ken, one for you. You called out sales and marketing and seeing some year-over-year decreases in expenses there. Just curious kind of where you're seeing opportunities to kind of reduce expenses within that org, and should we expect that to kind of continue throughout the year? Yeah. So we're kind of at a little bit of a stabilization point in terms of the run rate of expenses right now because we've essentially normalized some of the restructuring that we did last year. Gross margin definitely will continue to improve in Pega Cloud because there's a lot of things that we're implementing that actually have not been impacting margin to the positive yet and will continue to. Think about our go-to-market costs as less around where we can take costs out and more about leveraging that resource pool to accelerate growth, Kevin. We have a great growth opportunity acceleration through the rest of the year. We feel very confident that we will accelerate growth. GenAI is really just a massive catalyst for pushing productivity in our go-to-market teams because of that speed to ideation, the speed to getting clients to see the vision, the speed to getting them to realize their architecture designs and their workflows, and actually now with the latest changes to Blueprint, the improvements to Blueprint, to actually get the Pega application started. So we feel like that is just such a tailwind, so to speak, to sales productivity. We're focused on really putting those resources in the right place to accelerate scale and become more productive as opposed to a cost-cutting exercise. That makes sense. Thank you both. Your next question comes from the line of Pinjalim Bora with JP Morgan. Please go ahead. Great. Thank you for taking the question. Just two parts. One question for me. Are you starting to see some of the GenAI capabilities that you're introducing in cloud drive customer conversations around cloud migrations from the self-managed product that you have? And then, I guess, cloud ACV growth seems like has kind of reached a low point. Wondering if it is kind of at the trough level at this point as Blueprint and other GenAI capabilities drive consumption going forward. Let me take the second part of that. We do think Q1 was a trough for ACV growth. We had thought that that was the case when we guided. We had said that really in Q1. I think most of you know that because we saw the models that all of you had built, and so I think you definitely heard us on that. In terms of the ability for cloud migrations and GenAI and the connection, Alan, thoughts on that? Yeah. So we've hooked our GenAI capabilities, which are unfolding so quickly, to Pega Cloud, which only makes sense because we're able to roll out so much more efficiently and effectively. And we definitely see customers being interested in moving to Pega Cloud. They've been historically because I think it's both cost-effective but also offers some scalability and other features that they may have difficulty emulating in other environments. So we've historically seen that there was strong interest. We're definitely seeing that the GenAI makes that interest even more critical for customers who weren't already heading in that direction. One last point on that. About 2/3 to 75% of our clients have seen Pega Cloud now, meaning that they have at least one application or one environment for Pega Cloud. There's a natural momentum that as clients have one application on Pega Cloud, they look at moving all or other applications to Pega Cloud. So you do have a little bit of the flywheel on people buying more Pega Cloud, more clients getting exposed to Pega Cloud, which then will lead to the migration discussion that you mentioned. So I do think it's a I do think it's really a good time for that to happen now. Got it. Thank you. Your next question comes from the line of Rishi Jaluria with RBC Capital Markets. Please go ahead. Hi. Thanks. This is Rich Poland on for Rishi. Thanks for taking my question. So I guess first one, Ken, just to clarify, I believe you said AI contribution embedded in the full-year guide when it was provided was zero. So if we take a step back, can we just think about what needs to happen to achieve the guidance, and would kind of early adoption of Blueprint or Blueprint accelerating the adoption curve be upside to those numbers? Yeah. So yes. Your question is, you guided at the beginning of the year, 11% ACV growth, and we did say that we did not believe that factored in a noticeable impact to ACV from GenAI. Your question is, if there was a noticeable impact, would that provide upside to the growth number? And if that's the sense of the question, which is what I read, I would say yes. Significantly faster adoption of GenAI and influence into the pipe and the conversion of pipe is certainly an upside opportunity. Okay. Great. That's helpful. And then one for Alan. You mentioned the industry expertise as kind of a differentiator around AI. Can you just kind of expand on that a bit and just what you're seeing right now in terms of use cases in specific industries or just maybe any domain expertise that you're infusing into some of the solutions there? Sure. We took our industry experts, and we had them pull together the templates that made most sense for common industry problems in the areas where we have a lot of experience. We have a lot of experience, as you know, in banking and insurance and healthcare and government. And you can see that if you use Blueprint. Before we go out and begin infusing the GenAI content into the analysis, you can see our standard templates actually visible in the Blueprint choices you make. So if you say, "Hey, in banking or in financial services and credit card, and I want to take a look at collections as a function," you'll see a whole collection of our best practices pop up. And so I think we've been able to use the things that we've learned about the industry, the things we've learned about technology, which is how we've been able to pull this in. And I think the team's done a great implementation to be able to bring this together in a way that's very tangible and will be the basis for a lot more coming. Awesome. Thank you. Your next question comes from the line of Jake Roberge with William Blair. Please go ahead. Hey. Thanks for taking the questions, and great to hear about the hundreds of customers that are already using Blueprint. Just curious, what type of use cases are you seeing customers target with that solution? And then I know you have 20 or so other GenAI accelerators. Are there any other solutions that you're starting to see customer interest pick up for? Sure. We're finding that the customers are creating blueprints all over the map. There's a lot that are tied to particular service flows. So things that you want to do in customer service, the onboarding and lifecycle management of clients is another place where I'm seeing a lot of blueprints being done and being created. Being able to think about how you can modernize the front ends to your SAP and other back-end systems is an area that's central. So it's really the multitude of processes that historically, people had to go and sit down in front of a whiteboard and brainstorm. You can now ask our history and the internet to come together and have you do in two minutes what used to take two weeks. I think that's going to be pretty game-changing, particularly as it continues to evolve. Now, other accelerators that we have, the ones that I think one of the ones that is, I think, most interesting is we're going to be showing off at Pega World and have a client actually talking about the ability to do what's called Voice AI, which is to have the AI listen to the stream of literal conversation that's going on and use that to both make sure the person's saying the right things. So if in a regulatory business, you have to say certain disclaimers to make sure those things are actually said, but also to default fields of the screens and really very, very substantially improve productivity, both through that and also through things like being able to summarize the call. So I would say there are lots of features out there in AI, and you're going to see lots of vendors talking about feature A and feature B and feature C. What I'm most excited about is not that we won't have a great set of features. We absolutely do have and will have terrific features. But the ability to use the GenAI to fundamentally optimize the way the business runs, to be able to use it to build processes, I think is something I'm not seeing anyone else doing. And that makes me excited. Yeah. That's very helpful. Then, Ken, great to see the improvement in Pega Cloud gross margins. Where do you think those ultimately trend over time? And are there any costs to consider in that metric as it relates to GenAI? Yeah. That's actually an insightful question, the second one. So we see the margins getting above 80. And when I say above 80, I'm not talking about five years out, right? I'm talking about in the relative near term. So we think we'll get above 80. The question of once we get above 80, Jake, it's the question is, how far can you really push that? I mean, if you look at other companies in our space, and best of class for a multi-tenant SaaS solution is probably low-to-mid 80s. I mean, that's about as good as I have seen companies get. For us to get above 80% at less than $1 billion of revenue, I think is actually quite good. But I think there is still room to optimize there. So we're not in any way taking our foot off the pedal on that. The second point that you made about GenAI and GenAI utilization in the cloud, as of right now, the costs are relatively modest. I think as they scale, naturally, as the GenAI costs scale, our infrastructure costs to run it, there will be a direct correlation from that to actually ACV and cloud revenue that we're getting from our clients. So we do not believe that will be a headwind to margin expansion by any stretch. We think it will be just a cost of doing business like our AWS and GCP costs are. Yeah. We've been, I think, very aggressive and thoughtful in working through how, at this point, we want to apply GenAI. So the way that we've done it, and we've got information about this on our website. Our CTO has a nice little 7-minute video about how Pega applies this technology, is through the use of vector databases and what are called RAG techniques, retrieval augmented generation, that allow us to use a conventional model thing. ChatGPT, think Gemini from Google, think Bedrock from Amazon. And being able to pick the right model to use to be able to assemble the analyses from the work that we're doing in a way that I think is very cost-effective. So we, I think, have a way of doing this that's going to scale up nicely as the business grows. Very helpful. Thanks for taking the questions. Thanks, Jake. Your next question comes from the line of Dan Ives with Wedbush. Please go ahead. Yeah. Thanks. So on the go-to-market strategy, when you're talking about AI, can you just talk about what we could expect next 3, 6, 9 months? Is it more partnerships, even ramping up internally in terms of the types of individual? Can you just talk about from a go-to-market in terms of the next steps there? Yeah. So we definitely are working with some key partners and looking to broaden the partner relationships. And there's a lot of enthusiasm from partners to be able to apply some of this new technology here as well. What I'm excited about is I've never seen such quick uptake, never seen such quick uptake of a capability like what we've put out there with Blueprint. I mean, by a factor of 10 in terms of the number of customers, the number of things they're actually doing with it. And it really gives them a taste of GenAI. By the way, not just in English. What I love is I was over in Europe two weeks ago, and I couldn't read any of them, but we had people generating blueprints in Dutch and Italian. And it was really quite remarkable to gauge their reaction to the stuff I couldn't understand. So the uptake on this, I think, our go-to-market is going to end up being a lot more viral than it has been historically. And we're looking to ramp up to support that. Thank you. Your next question comes from the line of Steve Enders with Citi. Please go ahead. Okay. Great. Thanks for taking the questions here. I guess maybe just to start, I know ACV kind of came in line with the growth expectations for the quarter. But I guess how would you kind of frame where the macro environment is today and how people are viewing opportunities and budgets and maybe the impact that AI is having on that so far? So I'll take I'll add some comment. I'll take it first, and Alan can add some comments. So, Steve, I would say that the economy continues, certainly in the organizations that we're engaging with, continues to be pretty resilient in terms of clients wanting to invest in digital transformation. I think that GenAI is just an accelerant to that momentum because clients are looking at GenAI and digital transformation not as two different things. They're looking at them as being very related. How do I manage this legacy application situation that I'm in? And when I think about developing new capabilities, how do I want to insert GenAI? We're actually taking even a different angle to that, which is how do we leverage GenAI to help you accelerate your digital transformation, to get you faster to the place that you want to get to? I think that there's still a tremendous amount of resiliency in the market. Quite frankly, I think clients are thinking at the same or in an increasing pace around digital transformation than they were over the last 12-24 months. I think we're feeling very good about clients' interest in Pega solutions and how we can help them with digital transformation. Naturally, we have an election coming in the fall. Interest rates are still high. Inflation is kind of coming back a little or not. I mean, there's a lot of macro distractions there, but we see our clients really investing heavily in their digital transformation journeys. Okay. Great. That's helpful. Then I guess just on the now that blueprints are out there, have you seen customers actually convert that into production apps yet, now that that capability is out there? Or how should we kind of think about maybe the impact it was having on top of funnel or the kind of conversations that you're having today with that? Well, we're talking about something that's really been out there for a grand total of two weeks. So it's a little premature. But we see that happening imminently. I think my PegaWorld will have a number of success stories to talk about. Okay. Perfect. That's helpful. Thanks for taking the questions. Thanks, Steve. Your next question comes from the line of Austin Cole with Citizens JMP. Please go ahead. Thanks for taking the question. I've got yet another Blueprint question. I think the excitement around that is tangible. I was wondering if you can share any detail. As you mentioned in your prepared remarks, partners coming with new ideas. Maybe you can't go into detail on that just yet. But then also, anything you can share on maybe the breakdown between Pega clients using Blueprint and non-Pega clients that are coming to Blueprint and those two buckets and where you're seeing that distribution. Any detail there would be helpful. Thank you. Sure. So we made the decision to preview Blueprint with our partners a couple of weeks before we made it publicly available to clients and prospects on our website to make sure the partners felt respected and that they were part of the community that's moving forward. And they were in theory. It's one of the things they asked for, which we're in the process of implementing, is the ability for our partners to themselves create blueprints that they could use to capture their intellectual property and the structure of a Pega system, the way we talk about cases and stages and steps and interfaces. And given the ability to create their blueprints, which would then be proprietary to them, to make it so that when a customer blueprint was created, that customer blueprint, which today is an amalgam of Pega best practice and best practice from the internet, would now be able to be an amalgam of Pega best practice, the best practice from whatever partner was there pitching them, plus the internet. Put in those all together, I think that's going to be hugely, hugely powerful. So that's our agenda for the next 60 days, is to get that working. And that was directly based on what we heard from partners as to how they want to leverage this to be able to help their go-to-market, which obviously helps our go-to-market. So we're seeing a lot of enthusiasm there. We are getting customers in very significant quantity, I mean, very significant quantity, doing literally thousands of these blueprints in just a couple of weeks. And we are seeing prospects coming in. I think we'll see more of that as this begins to take hold and as there gets to be more buzz about that. It's still, once again, very young. But as you can experience it yourself, it's very real. Great. Thank you. Y our next question comes from the line of Mark Schappel with Loop Capital Markets. Please go ahead. Thank you for taking my question. Alan, with respect to Blueprint, I realize it's still early, but I was wondering if you could just talk about some of the consumption trends or patterns that you've seen on the Pega platform with respect to the early Blueprint adopters. I never would have expected we'd get thousands. There have been 20,000 blueprints created, some by Pega staff. Those can count as well, but many, many thousands by customers and partners. I would say that actually would have exceeded my expectation a month ago when we were beginning to talk about how we're going to roll this out and make this happen. It's garnering quite a bit of excitement. If you come to PegaWorld, and I hope, Mark, you will be there, then you'll have a chance to talk to clients themselves. I think you're going to hear great things. Mark, I think just to add one thing on that, the new feature that we just rolled out recently where you can actually implement a blueprint in a Pega system, originally, you could turn it into a PDF, right? You could look at it as a PDF. Recently, we have the ability to actually convert that into a Pega system. That, to me, is possibly the glue that connects what you're doing in a blueprint to the realization of how fast an app can actually be built. It is really. I mean, I know we're talking about it. You could probably envision it. But to think about sitting down, spending 30 seconds to 2 minutes, getting a framework of a workflow, going in and making it your own through the course of what could be 20 minutes, could be 1 hour, and then clicking a button that says, "Implement it," and you looking at an application that actually that you can react to. So what's interesting, so we've now and once again, it's all very new but very real. We've, for a lot of years, sort of less than two years, had a program we call Catalyst where we would go in with a real design-thinking sort of approach to help customers envision how they wanted to rebuild an app or rebuild a part of their business function. We ha ve a very talented team that's able to do this sort of work at a high level. I just saw the video of the first catalysts that we're doing with Blueprint instead of the traditional way where people would candidly end up at a whiteboard with stickies, Post-it notes on the whiteboard, and using Mural technology to kind of imagineer what they wanted. What they were able to do in two days was both an enormously high quantity, quality. It was two half-days. It blew the customers away. And it was really, really able to do what we always wanted to do with Catalyst, which is to catalyze new thinking and leverage what they were able to do. So this was a major European bank that we did it with. And in two half-day sessions, they did what I would have actually candidly expected to take three weeks or a month. And the customer was thrilled. So it's not just a little tech thing. It actually organizes the way people think about how they want to automate their processes in a way that makes sense with Pega architecture, which I think we've refined over all these years of doing it to be just a very effective way to thinking about process automation and being able to get rid of some of the historical barriers about, "Well, Pega, it's tricky. It's hard to use. You need a lot of experience. I think give us another couple of weeks." That's just not going to be true. So really exciting. Great. Thanks. And then, Ken, real quick, given the strong free cash flow generation this quarter, is there any update to achieving your Rule 40 targets this year? Well, I mean, certainly, we're dependent on hitting both our growth and our cash flow for the year, which is obvious. Us having a start with the cash flow in Q1 is moving the ball, so to speak, down the field quite a bit. So that side of the equation and our previous comments about the fact that we knew Q1 was going to be a difficult compare. So we knew that we were going to start with ACV growth decelerating in Q1, and we'll work our way back to that 11%. That was exactly how we modeled. So I'm feeling just as confident as I was last quarter in our achievement of Rule 40. And it's right there in front of us, which is great. And I think everybody could see in the numbers how we get there. But we've got three more quarters to execute, Mark. So we're going to keep focused on that. Okay. Thanks. Your next question comes from the line of Blair Abernethy with Rosenblatt Securities. Please go ahead. Thanks very much. Just, Ken, following on the last question, what's your renewal book look like this year, in the back half of this year versus last year? And I guess I'm looking for sort of the key incremental drivers that gives you that confidence that off this 9% growth number that you're going to average it out to 11%, it's a pretty back half is going to have to be a fair bit stronger. Sure, Blair. So Q4, we mentioned last quarter that our renewal book is skewed toward the back end of the year this year, in 2024, no less and a little bit more than a typical year. What hurt us in this year in Q1 is the strong Q1 of last year. Certainly, what helps us through the middle part of the year is that the compares in the middle part of the year are not as difficult as the beginning of the year. So some of this is just the timing of when ACV growth happens in the prior year and as you know how that fits into the trailing 12-month calculation that we have. So renewals, there's still always we always have a lot of renewals in Q4. That's no different for this year. So we certainly have expansion opportunities. But also, the activity through the middle part of last year was much more subdued than we expect this year. Okay. Great. And then just shifting onto the product side, any update at all on the Launchpad initiative you launched last summer? Yeah. I think it's going very, very well. We ended the quarter with 11 partners who are building apps on Launchpad. And that's been we've been doing this on a very sort of bootstrap basis. And we've seen our first partners bring their first customers into production. So we're really quite pleased with how it's going. Though it's not going to be the driver of growth this year. The GenAI and the core business is going to be what gets us to the growth objectives that we have for this year. I think Launchpad is hopefully going to continue to develop in the way that it is. And it's going to be a nice driver for next year and into the future. Great. Thank you. Your next question comes from the line of Tom Blakey with KeyBanc Capital Markets. Please go ahead. Hi. Good morning, everyone. And thanks for taking my questions. Alan, maybe for you, just on the success of Blueprint, sorry, a little bit of redundancy in terms of topics here. Can we talk about maybe the roadmap? I know it's early, but I'm sure you have a roadmap here in terms of utilizing some of your other technologies in terms of process automation process mining, rather, in terms of automating some of the further automation of ideation here, just creating some of the other end-to-end solution here. On the free cash flow, Ken, can you just maybe to remind us first question on the call here, and maybe this is the last one, remind us of some of these metrics. I think it was a $350 million free cash flow estimate for the year. You started off so strong here in 4Q, usually better than 1Q. I think we might all be looking for cues here, a little bit more guidance here in terms of how to manage and model free cash flow here for the rest of the year. Any visibility there would be great. Thank you. Yeah. So this is more of a general comment, Tom, but I think to your point, Q1 and Q4 is where we get the majority of our cash generation in 2024, even more skewed that direction than what you saw last year. Q1 started off strong. I think our billing and collection process is good. Our Day Sales outstanding is very strong. But the reality is you have more bookings in Q4, which do help the Q4 and Q1 billing and collection cycle. And Q2 and Q3, as in most enterprise software, is a little bit more subdued than that kind of hockey stick toward the end of the year in bookings. And so that's just kind of, and by the way, a lot of our renewals, we bill typically annually in advance. So you have a lot of those annual billings that happen in that same time frame. So just picture Q2 and Q3 being much more subdued. In some cases, we may not even generate cash flow in a quarter in the middle part of the year with our cash flow really focused on Q1 and Q4 in terms of the timing. So hopefully, that's kind of helpful. And relative to the roadmap, we have a very robust roadmap. The things we recently implemented around being able to pull the Blueprint into a Pega system and actually turn it into a running app was a very recent addition that obviously contemplated but makes a big difference. I think some of our next big steps are going to have to do with how we actually incorporate our customers' data structures and their existing data repositories into the Blueprint to be able to make it so this thing really can plug into the real life that our clients have. And also, I see Blueprint being able to be fed by process mining and other sorts of analytical things we do that will also help supercharge it. So lots more to come. And with that, I know we're at the top of the hour. Let me say thank you to all of you. Let you know we're working hard, and we look forward to seeing you at Pega World. Thank you. This concludes today's call. You may now disconnect.