Good afternoon, and welcome to the RingCentral Fourth Quarter 2023 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by 0. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note, this event is being recorded. I would now like to turn the conference over to Will Wong, Vice President of Investor Relations. Please go ahead. Thank you. Good afternoon, and welcome to RingCentral's Fourth Quarter 2023 Earnings Conference Call. Joining me today are Vlad Shmunis, Founder, Chairman, and CEO, and Sonalee Parekh, CFO. Our format today will include prepared remarks by Vlad and Sonalee, followed by Q&A. We also have a slide presentation available on our investor relations website that will coincide with today's call, which you can find under the Financial Results section at ir.ringcentral.com. Some of our discussion in responses to your questions will contain forward-looking statements regarding the company's business operations, financial performance, and outlook. These statements are subject to risks and uncertainties, some of which are beyond our control and are not guarantees of future performance. Actual results may differ materially from our forward-looking statements, and we undertake no obligation to update these statements after this call. For a complete discussion of the risks and uncertainties related to our business, please refer to the information contained in our filings with the Securities and Exchange Commission, as well as today's earnings release. Unless otherwise indicated, all measures that follow are non-GAAP with year-over-year comparisons. A reconciliation of all GAAP to non-GAAP results is provided with our earnings release and in the slide deck. For certain forward-looking guidance, a reconciliation of the non-GAAP financial guidance to the corresponding GAAP measure is not available as discussed in detail in the slide deck posted on our investor relations website. With that, I'll turn the call over to Vlad. Good afternoon, and welcome to our fourth quarter 2023 earnings call. First, I'd like to welcome two new board members, Ned Segal and Prat Bhatt, to the RingCentral family. Ned is a seasoned executive with more than 25 years of technology, finance, and capital market experience, including at Twitter, Intuit, and Goldman Sachs. Prat Bhatt is an accomplished technology industry veteran and financial expert, having served as the Chief Accounting Officer at Cisco Systems for over 20 years. I look forward to working with them both. I also want to warmly thank Allan Thygesen for his 9 years of service on our board, as he will be transitioning off the board in Q2. Now, moving to our results. We ended the year on a strong note. In Q4, total revenue rose 9% above the midpoint of our guidance. ARR rose 11% to $2.3 billion. We also achieved record profitability with quarterly operating margin of 20.5% and free cash flow of nearly $100 million, well above our outlook. Our strong finish to 2023 positions us well to execute on our strategy in 2024 and beyond. I returned as CEO to deliver on our strategy of, one, delivering durable growth and value from our core. Two, expanding our TAM by turning RingCentral into a multi-product, AI-first communications leader. To that end, we have recently added three new products to our portfolio. RingCX, our native AI-first contact center, RingSense, our conversation intelligence platform for sales professionals, and RingCentral Events, our new virtual, hybrid, and on-site events platform. And three, driving continued robust free cash flow generation while materially reducing SBC and maximizing free cash flow per share growth over the long term. Our right to win is rooted in our industry-leading, reliable, global, fully featured business communications platform that now includes Cloud PBX, cloud contact center, and video meetings, webinars, and events, all infused with state-of-the-art AI capabilities. As a testament to our industry leadership, in November 2023, RingCentral was named a leader in the Gartner Magic Quadrant for Unified Communications as a Service Worldwide report for the 9th consecutive year. We're excited to report that Aragon Research, an independent third-party research firm, just named RingCX as a leader in the intelligent contact center for SMB. We believe this is a testament to RingCentral's ability to continue delivering a superior, differentiated solution in a competitive market. We are proud to have built a $2.3 billion recurring revenue business that is growing, profitable, and serves over 400,000 customers across enterprise, mid-market, and SMB. Within Enterprise, which we define as customers that generate $100,000 in ARR or more, I am particularly proud to report that this segment has just achieved $1 billion of ARR. This is a major milestone for our company. In fact, in this post-COVID world, Enterprise continues to be a strong growth driver for us. Today, we count almost 20% of Fortune 1000 companies as our Enterprise customers. Among these are two of the world's three largest hotel brands, one of the world's largest car rental companies, and many leading Fortune 500 financial service companies. Notably, the majority of our Enterprise customers utilize our solutions integrated with and alongside Microsoft Teams. This strong presence with large customers and within the Microsoft Teams environment is a testament to the trust our enterprise customers have in our products and our ability to add value to the Teams' environment. Our new advanced integration with Microsoft Teams is the key reason enterprise customers select RingCentral. This includes customers such as Republic Airways, one of the largest regional airlines in the U.S. Overall, enterprise continues to be a growth driver for RingCentral with a positive long-term outlook. Let me now share some additional highlights of why customers, large and small, continue to choose RingCentral to power their communications. Broadly speaking, customers have historically picked us because of our 99.999 or five 9s reliability, which we achieved for the 22nd straight quarter. Robust feature set, regulatory compliance, and depth and breadth of our integrations. Here are some examples of key large wins and expansion for this quarter. One is a Fortune 100 insurance provider that purchased 20,000 UCaaS seats to connect its distributed broker network, made up of thousands of field offices. Another one is a Global 500 retailer that purchased 18,000 UCaaS seats to power communications across its more than 2,000 stores. And finally, a Fortune 500 global healthcare solutions company that added millions to their existing contract. One of the key integrations for this customer is our reliable and powerful calling capabilities embedded in Microsoft Teams, which they have already deployed to their employees. Their additional spend is a testament to their confidence in our ability to deliver a full communications platform and add value to the team's environment. Leveraging our core strengths, we are now expanding into adjacencies such as CCaaS, hybrid and virtual events, and conversational intelligence for sales. These categories have addressable markets that more than double our current opportunity to over $70 billion, providing multiple vectors for us to drive long-term profitable growth. Industry analysts and customers alike are already recognizing our ability to deliver in one of our key adjacencies, namely CCaaS. In their latest report, Aragon Research praised RingCX's ability to deliver powerful AI functionality, which includes automated quality management, coaching, and conversational analytics, while being easy to deploy, easy to use, and easy to maintain, and all at a disruptive price point. Regarding customers, we now have over 100 paying RingCX accounts, up from about 50 when we launched in November. These accounts include two Fortune 1000 enterprises who each purchased over 1,000 seats. We also now have hundreds of paying RingSense for Sales customers after having just launched in the second half of 2023. Lastly, approximately six months ago, we acquired Hopin Events business. We are happy with this acquisition and view it as a key addition to our portfolio. Since relaunching as RingCentral Events, hundreds of customers have hosted virtual and hybrid events on this platform in the past few months. This includes many large Fortune 500 companies and well-known businesses such as Spotify, Reddit, and HubSpot. We continue to see strong demand for our events platform. With recent improvements in packaging and pricing and the addition of AI-powered features for events, we expect to significantly scale this business over time. Notably, we recently won Harvard University over a well-known video-first competitor. Harvard chose us because of our advanced branding capabilities, level of production, and superior attendee user experience. While it is still early for our new products, given the level of traction we are already seeing, we believe we can achieve at least $100 million in ARR from RingCX, RingSense, and RingCentral Events collectively by the end of 2025. We expect these new products to be meaningful contributors to our strategy of delivering long-term profitable growth. Importantly, going forward, our multi-product strategy will be augmented by taking an AI-first approach to everything we do. AI is revolutionizing the way the world works and communicates. The pace of AI innovation in our industry is accelerating. We have a robust roadmap of new AI-based features that should help differentiate our core and new products from the competition. Over the course of this year, we are planning to announce many more AI-rooted innovations that will enhance both employee and customer experiences. Stay tuned for some exciting product and innovation announcements at Enterprise Connect at the end of March. We will leverage our broad go-to-market capabilities as we execute on our AI-first multi-product strategy. In that vein, I am pleased to welcome Brightspeed, formerly known as CenturyLink, who will join other valuable members of our global service provider family that now includes AT&T, BT, Charter Communications, TELUS, and Vodafone, amongst others. Speaking of Vodafone, we started with Vodafone UK and Germany, and in 2023, we expanded with Vodafone into Italy, Portugal, and Spain. We're super excited about a recent enterprise win with Vodafone, landing a 15,000-seat deal at IKEA, Germany. Last but certainly not least, profitability. We have greatly expanded our profitability, with operating margins improving from 12% in 2022 to over 20% exiting 2023. We also more than doubled our adjusted unlevered free cash flow to $325 million for the year. We continue to expect to drive further margin expansion and robust free cash flow generation in 2024 and beyond. Another important factor in creating shareholder value is minimizing SBC. I and our entire senior management team and the board are laser focused on and committed to delivering meaningful improvement in 2024 and beyond. Sonalee will provide more color shortly. In closing, we exited 2023 as a stronger, leaner, more profitable business, and we're well on our way to becoming an AI-first, multi-product portfolio company. Our opportunity is large, our strategy is clear, and we're heads down executing. I'm optimistic about our future, and I'm happy to be back at the helm, leading RingCentral's next chapter. With that, thank you, and let me turn the call over to Sonalee. Thanks, Vlad. I'll now provide highlights from the fourth quarter and full year 2023, and then discuss our guidance for 2024. In Q4, subscription revenue of $547 million was up 9% year over year, above the midpoint of our guidance range. ARR of $2.33 billion was up 11% versus last year. Our enterprise ARR grew 13% versus last year to $1 billion. We saw good traction in our $1 million+ TCV deals. We finished with a seasonally strong Q4, resulting in over 100 large deals for the year. Within SMB, ARR rose 9% versus last year, and mid-market ARR grew 10%, and we believe the demand environment has begun to stabilize. Moving to CCaaS. Once again, we saw more than 60% of our large $1 million+ TCV deals include both UCaaS and CCaaS. CCaaS ARR now represents over $350 million of our total ARR base. Now, moving to profitability. I'll be referring to non-GAAP results, unless otherwise noted. Subscription gross margin was 82%, consistent with prior quarters. Overall, ARPU was again above $30. Additionally, we are seeing good traction with our new products. We have already sold thousands of RingCX and RingSense for Sales seats at ARPUs that are higher than our corporate average and expect new products to be accretive to ARPU and retention over time. Operating margin of 20.5%, above our guidance for 20%, rose 650 basis points versus last year. Our focus on increased efficiency and productivity, and the significant operating leverage in our business continues to drive the meaningful increase in our profitability. Importantly, we generated quarterly adjusted unlevered free cash flow of $97 million, a quarterly record. Moving to our balance sheet. In December, we repurchased $253 million nominal value of our 2025 convertible notes for approximately $240 million. During the quarter, we also repurchased 2.1 million shares at an average price of approximately $31. Now, turning to the full year, let me share a few key takeaways. First, we delivered growth that was above the market.... Second, we meaningfully transformed our profitability and free cash flow generation profile. Third, we executed against our capital allocation policy that includes debt reduction, share repurchase, and investing in innovation, both organically and inorganically. Now, let me provide some more detail about each. First, regarding growth. Total revenue of $2.2 billion was up 11%. We began to see stabilization of demand in the second half of 2023. Second, profitability. We added over $210 million of incremental subscription revenue in 2023, while keeping our operating expenses roughly flat. This was driven by the reduction in sales and marketing expense, which as a percentage of total revenue, declined 370 basis points versus last year. As we optimize our marketing spend, increase the productivity of our sales teams, and continue to be disciplined in compensating partners based on the value they create. This resulted in operating margins rising 670 basis points versus last year to 19.1%, and adjusted unlevered free cash flow margins increasing from 5.2%- 14.8%. Regarding free cash flow, we generated $325 million of adjusted unlevered free cash flow for the year, which exceeded the midpoint of our guidance by roughly $30 million. The significant increase in our free cash flow reflects our increasing profitability, as well as efforts we have undertaken to optimize upfront channel commissions and improve our working capital efficiency. Lastly, we executed against our capital allocation policy that we had previously shared. In 2023, we strengthened our balance sheet as we repurchased $839 million of our 2025 convertible notes and $41 million of our 2026 convertible notes at a meaningful discount, and we were able to reduce our gross debt by over $90 million. We exited the year at 2.6 times net debt to adjusted EBITDA, down almost two turns compared to 2022. We also repurchased roughly 10 million shares for $315 million, or approximately $31.50 per share. Our board increased our repurchase authorization by $150 million, and we currently have $200 million remaining on our total authorization. Lastly, we acquired an events platform from Hopin, while continuing to invest in the development and launch of many new products. We accomplished a lot on the financial front in 2023. In 2024, our priorities are: one, invest in the business to drive growth. Two, expand profitability by remaining disciplined with our spend and focused on increasing efficiency and productivity. Three, significantly reducing SBC expense and net share dilution. And four, continue to deploy a capital allocation approach centered around deleveraging, share repurchase, and both organic and inorganic investments. Let me now expand on each of these priorities. First, investing in our business to drive growth. Growth in our core business remains stable as the UCaaS market is large and continues to expand. Additionally, as Vlad noted, we expect new products to meaningfully increase our TAM and contribute at least $100 million of ARR by the end of 2025. Second, expanding profitability. Going forward, in 2024 and beyond, we believe we can continue to grow revenue faster than operating expenses. We will continue to focus on increasing sales and marketing efficiency. This includes increased discipline with commissions paid to sellers and channel partners, and reallocating resources to where we see the highest ROI. Third, and very importantly, SBC. As Vlad noted, the senior management team and the board are laser focused on reducing stock-based compensation and dilution. We expect to reduce net new grants in 2024 by over 50% from 2023 levels. This results in total stock-based compensation coming down by approximately 350 basis points in 2024. We expect further meaningful improvement in 2025 and beyond. Finally, execute against our capital allocation priorities. Addressing our 2025 and 2026 converts is a key priority. $161 million of the 2025 converts remains outstanding at December 31, 2023.... We plan to utilize a portion of our free cash flow to retire the 2025 convert by its maturity date in March 2025. Based on our 2024 guidance and de-leveraging post-paydown, our net leverage ratio will trend closer to 2x. Our low and improving leverage ratio, strong double B credit rating, and strong free cash flow growth gives us numerous options for fully addressing our 2026 converts prior to maturity. Beyond addressing our converts, we will allocate our free cash flow to investments with the highest return. This includes organic and inorganic investments and share repurchases, where we see an opportunity to take advantage of the dislocation between how the market currently values us and the inherent strength of our business. We expect all these actions will drive significant growth in our adjusted unlevered free cash flow per share of approximately 25% in 2024, and to allow us to reduce share count in the intermediate term. Now, let me turn to guidance. Embedded in our guidance is the expectation that the macro environment and current business trends remain stable, with no further improvement or deterioration in conditions. For the first quarter of 2024, we expect subscriptions revenue growth of 8%-9%, total revenue growth of 8%-9%, non-GAAP operating margin of 19.5%, non-GAAP EPS of $0.79-$0.80. We also expect to incur restructuring charges of roughly $5 million-$7 million in Q1 in connection with the reallocation of resources to our new products, such as RingCX and RingSense. For the full year of 2024, we expect subscriptions revenue growth of 8%-9%, total revenue growth of 8%-9%, non-GAAP operating margin of 21%. This is up 190 basis points versus 2023. Stock-based compensation as a percentage of revenue is expected to be approximately 16% at the midpoint in 2024, and down from approximately 20% in 2023. We are also targeting a further meaningful improvement in stock-based compensation as a percentage of revenue in 2025 and beyond. We expect non-GAAP EPS of $3.50- $3.58. Lastly, we expect an adjusted unlevered free cash flow margin of 17.5%, or $415 million-$420 million. This represents a roughly 300 basis point increase versus 2023. In summary, 2023 was a year in which we delivered above-market top-line growth while achieving record profitability and free cash flow. Building on the significant margin improvement we achieved in 2023, we expect operating margins and free cash flow to continue to expand, all while reducing stock-based compensation. This is reflected in the over 600 basis points combined improvement in SBC as a percentage of revenue and free cash flow margin that we have shared in our guidance. We have put in place a strong financial foundation, and I believe we are set up well to deliver on our strategy of multi-product growth and expanding margins in 2024 and beyond. With that, let's open the call for questions. We will now begin the question-and-answer session. To ask a question, you may press Star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press Star then two. In the interest of time, please limit yourself to one question. Our first question today is from Meta Marshall with Morgan Stanley. Please go ahead. Great, thanks. Maybe, Vlad, you could just speak to, you know, given some of you stepping back into the CEO role, just whether there were any change in objectives between kind of, different management that has been in the role over the last six months. And then maybe just on RingCX. Clearly, you guys are seeing a lot of traction with new customers. Just any initiatives to sell that into the install base, or it, you know, is that largely being sold to new customers today? Thanks. Yeah. Hi, Meta. Sure. So look, how have there been changes? Look, the new management, as you say, you know, has been around for a few months. So obviously, you know, we're a large company, and whatever momentum was carried into that period, you know, continued. But I would say that, with me coming back and taking a fresh look at things, I think that you can expect a little bit more focus on technology and innovation. I think, as you saw in the prepared remarks, there is a renewed focus on becoming a multi-product company and new product introduction. So you can expect to hear the word product from me a little bit, more often than maybe, from, the prior management here. There, there is continual, concentration and focus, on, profitability and profitable growth, so that is not going to change. Another one, is, that I want to highlight is, I think there was, some maybe confusion, a few months ago about RingCentral call it retreating back into SMB. That is not what my plan is. RingCentral, our origins were indeed with SMB, but, we've spent a better part of the last decade in expanding from SMB, to, an all market company, including, large enterprise. As you heard today, it is now a billion-dollar business. It's not. Billion dollars is not something that most people would walk away from, and neither am I. In particular, in the enterprise, it continues to be a growth vector for us, so it grows faster than the company overall. We are extremely pleased with the traction we're now getting within the team's ecosystem. As you've, I believe, on prepared remarks, you've heard that we count 20% of Fortune 1000s amongst our enterprise customers. So to be clear, it means that not you have, you know, one in ten seats in a large company, but that these are $100,000+ ARR deals. So these are real users. And over half, or I think we're saying close to 60% of it are actually Teams users. So this gives me, you know, really great hope that that segment will continue to perform. The next question is from Siti Panigrahi with Mizuho. Please go ahead. Oh, hi, thanks for taking my question. Sonalee, very impressive margin expansion and cash flow generation. But if, if I look at your top line growth now decelerating from 11% to now high single digit in 2024, so what needs to happen, or is there a possibility for you to get back to this double digit growth? And, what are the key assumptions or driver for growth in this year that you embedded in your 2024 guidance? And, what sort of conservatism are backed into the guidance? Yeah. Hi, Siti. Firstly, thanks for your comments on profitability and free cash flow. And secondly, great question. I'm glad you asked it. On top line, I think it's really, really important for me to address this. We did take a deliberately conservative approach to the way we guided on revenue for this year, because there is still some macro uncertainty out there. I mean, you know, we're all seeing it. I think if you look across, you know, all the software companies that have reported up to now, and because of that uncertainty, we wanted to be prudent in the guide, and what I would say is we're being very prudent. And I do believe strongly that we can drive back to double digit growth. This is not an aspiration, this is something we can realize based on the very strong building blocks we have that are in place already today. You've heard from Vlad, but I'm going to talk about new products as well. Customer and analyst feedback we're receiving from our new products gives me a lot of confidence in our ability to scale these products to at least $100 million of ARR by the end of 2025. And that will have a very positive impact on our upsell, which you've heard me call out in the past, has been impacted by the current macro environment. But as the macro improves, we do believe these will be important tailwinds, several percentage point tailwinds to our growth. So together with the incremental growth from new products and the re-acceleration from the core as a result of improved retention, we think that those are key catalysts to getting growth, you know, above the high single digit or 9% that you talked about just now. In terms of margins, just one other point I want to make is that the margin expansion for 2024 that I've guided to, which is 200 basis points, it would have been higher. However, we've made some investments in the business in 2024 to drive growth in new products, including around demand gen and customer and channel incentivization. But also, we have made a deliberate decision to shift a portion of our stock-based compensation to cash. So, you know, both of those elements together resulted in about a 200 basis point headwind to operating margins. So it would have been that much better in terms of the guide. And we expect to be able to, you know, continue to deliver annual margin expansion this year, next year, and beyond that, due to the operating leverage in the model. The next question is from Terry Tillman with Truist Securities. Please go ahead. Yeah, well, thanks for all that extra color there, Sonalee. Hi, Vlad, Sonalee, and Will. Just my multipart single question is just first on the $100 million dollar- ... target for ARR at the end of 2025. I'm just kind of curious from here to there, I mean, are we talking like $25 million or $50 million in 2024? Just trying to understand how much of a deepness we're gonna need into 2025. And then the second part of this question is: on enterprise ARR, even with the conservatism, should we assume comfortable above, above 10% or maybe even low teens enterprise ARR growth? Thank you. So in terms of the actual $100 million target that we've set, I mean, we will certainly look for opportunities to give you milestone updates to that. But you know, again, just leaning on the conservatism point, we feel like that is a very achievable number. And you know, that will be mainly driven by RingCX. That will be the lion's share of it, but we think that we will continue to deliver across all the new products that we've introduced in the last quarter or so. And you know, I think importantly, when we thought about our guidance, we decided to specifically be very conservative on the ramp for 2024. So expect to see much more of that to hit in 2025 and beyond. I'd say really, Terry, that like second half of 2024, and then certainly in 2025, very, very strong contribution. The next question is from Ryan MacWilliams with Barclays. Please go ahead. Thanks for taking the question. Great to see the year-over-year growth and revenue growth and plot in the first quarter, similar to the fourth quarter. So where are we overall in terms of the macro? Like, are you starting to see bookings conditions improve generally? Do you see any changes in linearity, like, do things get better at the end of the quarter? Thanks. Yeah. So on linearity, great question. So you've heard me the last couple of quarters talk about seeing bookings much more back-end loaded, and it was quite exaggerated, in the last two quarters, and particularly in that final month of the quarter. You know, the way that we've guided for this year is really assuming no change to that linearity, so that, that, more back-end loading. However, we have seen some stabilization in some of the macro trends that you've heard us call out in the last, 12-18 months. And in particular, things like sales cycles, deal size, you know, deployments, approvals, things like that. So, you know, we do see a stabilization. We've certainly seen that stabilization continue into Q1, where we are, as we stand now, and the guidance today just assumes that continued stability. Yeah, and I just want to add to that a little bit. Look, bookings are actually pretty good. Bookings are strong. Given you know still a bit of instability in macro, upsell for us is a little bit more challenged. So when I say bookings, I mean the I mean new logos and new business in particular. So we are seeing strong demand there. Okay? And that really, one would think, would you know bode well for for the future. Issue is a bit more with upsell, in certain cases, downsell, and this is just as businesses are right-sizing. But you know hopefully, as the economy recovers, this too will turn into you know back into a tailwind. But as you can, you saw from our press release, and the releases and some of the prepared remarks, look, we continue signing up new logos and very important logos. And you know, to make this comment, I went into how well our enterprise segment is doing. But our S&P segment, which is a $1.3 billion business, you know, is also going pretty strong. So I would say that, you know, it's certainly far from being frosty, you know, but I would say my general feeling is that things are healthy out there. The next question is from Michael Funk with Bank of America. Please go ahead. Yeah, thank you for the question. One for Vlad, if I could. So Vlad, a proven playbook and a subscription-based model with slowing growth is to roll up smaller competitors and gain scale. You know, Sonalee mentioned inorganic as a potential use of capital during her earlier remarks. So in your view, what is the argument against rolling up smaller competitors to improve scale at RingCentral and you know, potentially grow margin faster in your dominant market share position? Yeah. Look, so, firstly, we are by no means adverse to M&A. It has to make sense. We've highlighted our recent Hopin acquisition and how well it's doing for us. So, I would say that, in the Hopin case, it would be more of an adjacency versus a competitor. I think that, look, there are different ways to look at this, but, by going after adjacencies, you're acquiring or buying into new TAMs and new SAMs. And, you know, it would be, we think, deals like that would provide long-term tailwinds to the business as a whole and would set up well for long-term growth. As far as buying up competitors, look, there are many reasons to do it, such as, you know, various efficiencies that can be garnered. But you know, then, if we're talking about the right competitors, then it's a matter of, you know, what do you do about the platforms? Do they run multiple platforms? Do you move from one to the other? I think we have some relatively recent examples in the industry, where even amongst our you know folks that one would say would be in our space, where these types of mergers you know yielded results that were a little bit mixed. So you just need to be a little bit more careful. But certainly, at the right price, we would never say no, and I can tell you that we routinely look at numerous opportunities, given our size and stability of our business, and very importantly, our most recent cash flow expansion in, you know, in free cash and profitability. We do feel that we are a natural acquirer, natural consolidator, so always on the lookout. Yeah, that was very helpful, and certainly I look forward to hosting you next week in Boston for the NDR. I look forward to seeing you then. Same here. Thank you. The next question is from Samad Samana with Jefferies. Please go ahead. Hi, good evening. Thanks for taking my question. So it's kind of a multi-part as well. So on the new products, glad it's, you know, big expansion of the portfolio, but they touch up against at least some of what your UC partners also provide, if I think about sales and events. How should we think about maybe where these fit into the ecosystem versus some of the companies that you partner with? And then secondly, just what are you assuming for, you know, UCaaS versus CCaaS versus other, maybe as we think about 2024 ARR growth, just because there's been kind of just big differences in the growth rates. Thanks to both of you. Yeah. Hi, Samad. Yeah, look, no, great question, questions. Look, when you're saying some of the companies we partner with, I assume you're referring to RingCX vis-a-vis RingCentral contact center, which is hosted by NICE inContact. So assuming I have the question right, look, they're designed to address different segments of the market and different use cases. By and large, NICE inContact is a well-established enterprise leader. They're able to and have proven success in hosting multi-thousand-seat contact centers with very complicated use cases. And they fill a very nice, you know, niche in the upper end of the market. So we have this integration with them that's multi-year-old, and it obviously has been quite successful for us and for them over the years. And you know, we stay committed to that relationship. Having said this, we clearly see an opportunity at the bottom end of the market, as well as maybe even some of the larger customers, but with simpler, more streamlined workflows. And this is where we saw an opportunity to come in with a differentiated product that's simpler to use, simpler to deploy, a lot more cost-effective. We truly are positioning it with disruptive pricing, and people are taking notice. I think we mentioned, we've doubled the number of logos in about three months, so we're happy with that result. We already have some larger customers in the thousands of seats. Frankly, that was a pleasant surprise for us. But you know, success breeds success. And you know, look, it's very early, but early signs are pretty positive. So for now, we believe that the two will coexist. So, Samad, just to answer your question about UCaaS, CCaaS, bookings growth breakdown. So firstly, you know, we don't specifically guide on bookings and certainly not bookings or growth by product, but I can just give you a bit of color there. We do believe and certainly embedded in the guide, in the comments I made earlier about, you know, we think we do see upside to where we're guiding. We believe we can grow faster than the market for each of these markets. So, when I talk about the market, I'm talking about third-party data. You know, where UCaaS is sort of mid-single. We think we could grow significantly above that. And then, for CCaaS, I think the market, again, it's, you know, below 20% in terms of what third-party data is saying. And certainly, RingCX will be well above that. But overall, we believe we will grow faster than the market in both of those segments. The next question is from Kash Rangan with Goldman Sachs. Please go ahead. Yeah, glad you talked a lot about new products, et cetera. So what does the new product direction of RingCentral look like? ... over the next few, next few years, where do you see untapped opportunities for innovation, that can get the company back to re-accelerating growth, as certainly pointed out? And it's, it's always good to see founders be involved in the business at this stage. It's good to, good to have you back. But founders, I'm sure you will agree more than anybody, Vlad, are not satisfied with single-digit growth rate. I mean, they're, they're inherently growth people. So how do we put that, put your new product strategy in the context of your real aspirations for the company, and what are the things that you could be doing differently the next few years? Thank you so much. Right. Yeah, yes. Look, so, we are, I would say, at the early stages of executing on exactly the strategy that you've outlined. So we are now, and frankly, from what I remember, really maybe for the first time, in our existence, as a public company, we're now actively talking about NPIs, new product introductions, and about becoming a multi-product company. I can tell you that, you know, it sounds simple. Well, sure, you have one product, what's another one to add? It is actually a big deal, okay? To go from a single product where you have a, you know, sales force trained to sell, you know, one particular solution, where you have product people who are specialists in one particular area and only that particular area, where your technology base, you know, only needs to address one use case, support, et cetera. So everything now needs to be done several times over, which is a heavy lift. But we think that juice might be worth the squeeze here because it opens up new TAMs for us, largely expands our cumulative TAM, and very importantly, provides us with new buyer personas. So your addressable market increases as well, in addition to the TAM increasing, okay? So if you look at our just recent introductions, look, we've reintroduced or introduced RingCX just last quarter, okay? And it already has over 100 logos. We have repackaged Events, RingCentral Events. That was also last quarter. And we've announced a very major win. We announced a very major win with Harvard today. That's a big deal. That was a head-to-head win against a very well-known and well-funded competitor, let's say. Okay, so we think that these are early signs of successes to come. If you think about it, the goalpost that we've set of $100 million in two years from these new products, it's meaningful, you know? I guess you can say, "Well, gee whiz, you know, RingCentral is a $2.3 billion company. What's another $100 million?" But $100 million is a big deal, okay? Because it's, you know, as of today, you know, if we had that, it would be 4 additional points of growth. So that by itself would put us into double digits. And, you know, this is early. So, core belief here is that by redoubling on new products, not introductions, I mean, we cannot be introducing a product per quarter. You know, that would be hard, a little bit hard to manage. But, RingCX gets us squarely into the cloud contact center market, and which is large, growing faster than the traditional UCaaS market, so it will be a growth driver. Events is a completely different buyer persona for us. We are now able to sell to marketing departments and sales departments, and something that we were never able to do with our traditional products. So we believe that that's going to be a meaningful business. And meanwhile, we see continual stability in our base. We are able to gain substantial new logos, both in SMB and enterprise. I already covered that. So I think I believe that all of this will be adding up, and I'm optimistic that we can over time get back into double-digit growth, even as you know we cross the you know $2.5 billion mark and beyond that. I mean, it's a heavy lift, but we do have a strong team, and most importantly, we are playing in markets which are still grossly underpenetrated. We're one of the large and profitable companies, one of the few large profitable companies, who are playing in this space. The next question is from Ryan Koontz with Needham. Please go ahead. Thanks for the question. I want to ask about the competitive environment and the shift toward, you know, AI features and new products, and how are you seeing that shift impact the decision criteria of your customers? And maybe just want to buy UCaaS or CCaaS, you've seen that in the forefront, and how is it changing the types of competitors you bump into, you know, whether it's, you know, a legacy player or maybe like a Zoom or a Dialpad that's more focused on AI? Thanks. ... Yeah. Well, look, I'll just speak about ourselves. You know, I won't comment on what Zoom or Dialpad or anyone else necessarily is doing. I would maybe question a little bit saying that any of them are more concentrated on AI than we are. We do see ourselves as an AI-first company. RingCX, in particular, is leveraging our RingSense technology, which is our AI platform, and that is having very good traction out there. Our growth is very much, in my mind at least, my understanding, is very much tied to specifically it being an AI-first product. Okay? And look, AI, in a way, is a great equalizer. With AI technologies, we can go against industry incumbents and, you know, we don't need to replicate the entire feature set to be competitive, just because the way that people approach, for example, customer service, is radically changing with availability of LLMs and, you know, IVAs. And, you know, just as the game shifts from, hey, let's empower or power up more agents, versus let's handle more transactions at quality, but save companies money by letting them reduce their contact center staff. So we think that for RingCX, in particular, it would be a great tailwind. Same for events, okay? Which is the two products we're highlighting. Again, it is absolutely ripe for AI innovation, and we'll have a lot more to say about both of these and some more at Enterprise Connect, which is coming up next year. Now, as far as our core product is concerned, look, when all is said and done, why do people buy RingCentral given the other options in the market? And the answer is, to me at least, is relatively straightforward. So they buy us, A, because we're stable, we're always up. We have 5-6 nines availability for many years and counting, and from what we are being told, this is absolutely industry best. Okay? So this is one reason. Second reason is we're global and regulatory compliant across the world. Wherever we are allowed to do business, and there are still some countries that are closed, unfortunately, for example, China. So okay, we're not going to be regulatory compliant, then we're not offering services there either. But everywhere else, we've checked all the boxes, so companies large and small can feel safe from that perspective who are using us or reselling us. Okay? Then there is the feature set, okay? And we've pioneered the space. We've been at it for the longest. We simply have more features and more integrations than anyone else out there, and that includes even some of the larger competitors that you can easily think of, okay? And very importantly, it's our commitment to data privacy. We are religious about our customers' data, just as we are about our data. And that is a commitment, you know, coming in from the highest levels. And it's just something that our customers don't tend to be concerned about, is data privacy or our commitment to security. So this is why people buy RingCentral. Now, what does it have to do with AI? If you take all of that and overlay AI on it, then you simply get a more powerful solution, okay? People, given our size and our stature in the field, people don't need to buy RingCentral for AI alone, okay? But if you combine this industry-leading, stable, global, secure platform with state-of-the-art, AI capabilities, then we think you have something that's quite differentiated and that will truly take us into this decade and beyond. I don't know when the next magnitude of innovation will happen that could compare with what we're now experiencing with AI. We're super early there, and opportunity to innovate and to differentiate are literally boundless, okay? So again, we would really urge all of you to please visit us at Enterprise Connect. We'll have more to share then. And you know, obviously, results will speak for themselves, but you can-... Expect that even as we are, very much, moving towards, a better balance between growth and profitabilities, and perhaps what we've had, in the years past, our commitment, to innovation is unwavering. We have, well over 1,000 engineers, involved with the company. It is not an area that we're saving on or skimping on, so expect more goodness in that, in that area. The final question today is from Brian Peterson with Raymond James. Please go ahead. Thanks, and nice job on the free cash flow ramp this quarter. Sonal ee, I appreciate all the color on the demand environment, but would love to hear about what's going on at the top of the funnel. How has that trended, and any notable changes in mix there, via partner versus direct or enterprise new products? Would love to get any perspective there. Thanks, guys. Yeah, sure. Thanks for the kind words on free cash flow. So, so in terms of what we're seeing in the demand environment, I would say there's not a really big change to call out. One thing that, you know, I would just comment on is we did see a stabilization in, in, in SMB. We saw strong trends from the enterprise, side of the house. And, you know, we don't really tend to give you much more breakdown, in terms of, you know, segments or, or, or what we're seeing from the segments. But, you know, in terms of how the guidance, is reflecting what we're seeing, you know, it's assuming this continued stabilization, so no real improvement. So if we were to see an improvement, for example, in the upsell environment, or if we were to see traction from some of the steps we're taking around churn to improve net retention, then that would be upside in terms of what we've laid out to you today. The other thing I just want to say before we conclude the call, you know, Vlad and I and the senior management team are extremely focused on SBC, and hopefully you saw that in the way that I guided, there's meaningful, meaningful reductions in 2024. So, we're guiding to 16%, coming down from 20%. But we're not going to stop there. You know, net new grants for 2024 will be down by approximately 50%, but we will continue on our drive to bring that down, and you should expect further several hundred basis point improvement as you look forward to 2025. This is something that we take very seriously, and, you know, thanks for calling out the free cash flow, and mentioning the free cash flow, but we care about free cash flow per share. And hopefully, you will have noted that the free cash flow per share growth that we will deliver for you in 2024 is 25% year-over-year growth. So, you know, look forward to spending more time with all of you, in the conferences coming up over the next several weeks, but just wanted to be sure that that point was taken home. The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.