Good afternoon, ladies and gentlemen. Thank you for attending today's TechTarget Q3 2021 Earnings Release Conference Call. My name is Tia, and I will be your moderator for today's call. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. I will now pass the Conference over to your host, Charles Rennick with TechTarget. You may proceed. Thank you, Tia, and good afternoon. Joining me here today are Greg Strakosch, our Executive Chairman, Mike Cotoia, our Chief Executive Officer, and Dan Noreck, our Chief Financial Officer. Before turning the call over to Greg, I'd like to remind everyone on the call of our earnings release process. As previously announced, in order to provide you with an update on the business in advance of the call, we've posted our shareholder letter on the investor relations section of our website and furnished it on an 8-K. Following Greg's introductory remarks, the management team will be available to answer your questions. Any statements made today by TechTarget that are not factual may be considered forward-looking statements. These forward-looking statements are based on assumptions and are not guarantees of our future performance. Actual results may differ materially from our forecast. Forward-looking statements involve a number of risks and uncertainties, including those discussed in the risk factor section of our filings with the SEC. The company undertakes no obligation to revise or update any forward-looking statements in order to reflect events that may arise after this conference call, except as required by law. We may also refer to financial measures not prepared in accordance with GAAP. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measures accompanies our shareholder letter. With that, I'll turn the call over to Greg. Great. Thank you. We continue to see broad-based strength across all products, customer segments, and geographies. We expect this positive momentum to carry into 2022. For Q3 2021, GAAP revenue grew 92%. Adjusted revenues grew 97%. Net income grew 47%. Adjusted EBITDA grew 125%. We raised our revenue and EBITDA guidance for 2021. I will now open the call to questions. Absolutely. We will now begin the Q&A session. If you would like to ask a question, please press star followed by one on your touchtone keypad. If for any reason you would like to remove that question, please press star followed by two. Once again, to ask a question, press star one at this time. As a reminder, if you are using a handset, please mute your phone. We will now pause here briefly to allow questions to generate in the queue. The first question is from Aaron Kessler with Raymond James. You may proceed. Great. Thanks, guys. Congrats on the quarter. A couple questions. First on the organic guidance for 2022, I believe you indicated high teens organic growth in the shareholder letter, which I believe is the highest in a few years. If you just may unpack this a little bit, maybe volume versus pricing growth and maybe Priority Engine growth expectations for 2022 as well. It looks like you had some nice international strengths in the quarter. Just any additional commentary there. Thank you. Great. Thanks, Aaron. This is Mike. In terms of 2022 guidance, you know, preliminary guidance of high-teens growth, we're seeing good momentum across all facets of the business, across the products and across the regions. We talk about the tailwinds that we've accounted, but I also wanna make sure that people understand the execution across our product team, sales team, and customer success team has been really strong. When you couple that with the tailwinds in terms of positive IT budgets, companies continuing to modernize their sales and marketing organizations, and then the compliance and data privacy regulations, we're having an opt-in permission-based audience like TechTarget has built over 22 years, and the continued shift from face-to-face events coming onto, you know, digital and data-driven online events. Those bode very well for us, and that's where we're giving the guidance of the, you know, the high teens growth for next year. In terms of Priority Engine, you know, we think we're gonna be back to 20%+ growth for Priority Engine, again, based on those tailwinds and what customers need. If you really think about it, our customers, when you focus on this modernization of their sales and marketing organizations through automation and through tools and software and data, one of the biggest catalysts on that is first-party owned and operated purchase intent data. So that is some of the color. In terms of the international, we continue to see good growth, and those same tailwinds really impact us across all of our regions. I'd also add on there, we've discussed this in previous quarters and previous years, any other regions outside North America, there is a high focus or a high concentration of budget from our customers that has always been allocated to field events, face-to-face events. Field marketing and sales work closely in those regions. Those budgets have gone that way. In the last year and a half since COVID, we've seen that acceleration in the digital transformation from face-to-face to online and data-driven, and we're continuing to see that in the international space as well. Got it. Quick follow-up. Any lingering kind of headwinds from COVID you're still seeing maybe on the Priority Engine Express business? Any headwinds you're seeing maybe from the supply chain challenges impacting marketers' budgets as well? Yeah, on the headwinds in terms of Priority Engine Express, you know, we've seen good momentum, and we're pleased with the progress that we've made across those smaller customers. As we mentioned before, Priority Engine is, you know, historically been really focused and geared towards marketers and marketing budget holders. We'll talk about this in a little bit, some of our key investments have been around the sales use case. When you get into those smaller companies where Priority Engine Express is really a good fit for, you know, there's one common denominator across all those. They have an inside and outside sales presence. They might not be focused on the marketing, they might not have the sophistication and the tools and the technology for marketing. We're seeing a nice pickup in terms of not only customer adoption, but customer usage on that. I'm sorry, what was the second question that you had? The headwinds on the Supply chain. Supply chain challenges. Yeah. You know, we obviously keep an eye on that. We have not seen that hit us right now and our customers. Again, with the healthy IT budgets in the IT market right now, it's been good. Those are some of the macros that we keep a close eye on. It has not impacted us right now. You know, most of our customers, if you remember, have gone from, you know, hardware to SaaS-based software customers. I think if this was 10 years ago, where vendors that primarily bought from TechTarget were, selling servers, storage, and network hardware equipment, we would see a greater impact if that was the case. Because of this transformation to cloud and SaaS and software, it is really not. We're not seeing that in the budgets. Got it. That's helpful. Thanks, and good quarter. Thanks. Thank you, Mr. Kessler. The next question is from Bhavin Shah with Deutsche Bank. You may proceed. Thanks so much for taking my question, and congrats on the performance in the quarter. I was wondering if you could just dive into more detail on the product enhancements that you talked about to Priority Engine in your shareholder letter. You noted that you're gonna kinda sell these as separate modules going forward. It's great to see kind of these updates from a product standpoint. I guess maybe from a go-to-market perspective, do you guys have to make any real changes to kind of address this new sales case that you're really going after? Great. Thanks for the question. Let me give you a little bit of summary on the product, Priority Engine product enhancements. In June, we had just launched some additional enhancements in Priority Engine, and the focus on this, Bhavin, was really focused on the sales use case. There were a couple of things that we did in June around integrating and adding the account-level signals that we're seeing from the BrightTALK audience. Why did we do that? You know, we did that so we could give and expand our customers' sales force up to 2x in terms of accounts that were within their territories that they had insights around that they could go and engage with. We also enhanced some of our Inbound Converter capabilities, and that capability set is tracking visitors, accounts that visit our customers' websites. Then we took it to a more granular level. We wanted to know which pages they visited. Are they looking at product comparison pages? Are they looking at case studies? Are they looking at, you know, demo pages? That brings greater insights and intent to the sales force. As we look at our next release that we've been working diligently across from our product team, development team, customer success team, I would break it out into two areas. There'll be data enhancements and user experience or user interface enhancements. What I mean by that on the data side, we are now offering an upsell for, you know, offering the opportunity to ingest the BrightTALK not only the account level, but the prospect level, intent information at the individual buying level information into the Priority Engine platform. That would be up for an upsell. We now have the individual buyers inside of BrightTALK who are engaged in virtual video, you know, summits, virtual events, webinars, now ingested into Priority Engine for an upsell, for an upcharge. We're also taking a look at making sure we understand certain key areas around content preferences. When you have a sales rep that can understand if their buying team or their prospects or their customers are engaged in webcasts versus white papers, those sales teams have a cadence where they follow up on. Whether they use the, you know, sales enabling platforms like Outreach and Salesloft, to have that better information and more accurate information if their prospect or customer is looking at webcasts versus white papers versus case studies, enables a better cadence follow-up. In terms of the user interface, we wanna make sure this is seamless. We wanna make sure this is personalized. Making sure that these sales reps have quick links to access all this relevant information. Like at a click of a button, they're identifying their customers and prospects around what content they're using, what content they're engaging with. Also, our customers have come back to us this year and said, "The information is so powerful. How can you also provide us an account journey and a buying journey?" Now as part of this integration and this upgrade, we're gonna be able to provide day-to-day impacts at the account level about very critical information and engagement levels with a 90-day look back. It's just not a point in time. It's gonna continue the buying journey information that we can share with sales teams within our customers', within our customer accounts. Other features like, you know, find new accounts and buyers that reps have not engaged in and surface them to the top in a unique view because we don't want our customers' sales teams to miss any opportunity or deal. Being able to do all that, you know, in a sales interface is gonna be very impactful for the team. That's very helpful. Just a quick follow-up. I noticed that your long-term revenue ticked down a bit to 37%. It sounds more like it's a matter of seeing more strength with the more quarterly cadence that the business is given the strength in the IT environment. Is that the right way to read it? I think it's an absolutely right way to read it. If you look at the total revenues associated with long-term contracts year- over- year, you know, we're roughly about $13 million, and we're at $26 million this year. The percentage decrease from 40% to 37% is from the demand and the success that we're having selling across all of our, you know, purchase intent-driven products. It's an overall higher, you know, denominator in terms of overall revenue, and that's being accounted for or driven by those tailwinds we've talked about in the execution at the company level across the board. That makes sense. Thanks for taking my questions, and congrats again. Thank you. Thank you, Mr. Shah. The next question is from the line of Joshua Reilly, Needham & Company. You may proceed. Hey, guys. Thanks for taking my questions. Congrats on the quarter. You mentioned the record demand for quarterly-based products in the shareholder letter. I assume that means like content syndication and QSO reports in particular are strong. The high teens growth guidance implies this growth is sustainable, you know, into next year. I'm just curious, what gives you confidence as the economy reopens that growth for those products is sustainable? Thanks, Joshua. In terms of the quarterly demand, you know, we saw this transition. Every company accelerated their digital transformation from, you know, whether they were planning to do it over the last, you know, over a course of three or four years. They've done it, and they're working on it right now over the past 18 months. Clients have gone in there, and that's not to say that there will not be some face-to-face event engagement. We believe that will always be there. I do not believe, and we do not believe that we'll ever go back to the level that we saw pre-COVID. There's so many reasons for that. A, it's more efficient for customers and any vendor to engage digitally and through data to scale their business. It's more cost-effective to do that. We've always used that analogy. When you go from analog to digital, do you ever really flip back to analog? We don't believe that that's gonna happen in the enterprise B2B space. There'll always be a place for face-to-face events, but the demand that we're seeing. Again, let's go back to those tailwinds. Customers are striving to modernize their sales and marketing organizations. They do that through automation, they do that through tools, and they do that through data. First-party opt-in permission-based purchase intent data is a real driver in that. Those same customers have seen the efficiencies, the scale, and the measurability from going to face-to-face events to digital and data-driven online campaigns. It's really hard to go back because customers don't wanna spend or send 20 people to Vegas for a three-day road show and have really nothing to come back to account for that. Just with all the other trends that we're seeing, not only from the face-to-face shift to online, face-to-face event budget to online, but we're also seeing with Google announcing that they're gonna eliminate third-party cookies in, you know, 2023. This all bodes well for us, and we're gonna continue to focus on what we've been focused on, content, opt-in and permission-based audience, first-party intent data, and delivering that to our customers so they can execute with their sales and marketing departments. Okay, great. Just one follow-up. You highlighted a 40% adjusted EBITDA margin as the goal for next year in the shareholder letter, you know, which is nicely above my prior estimate. Maybe you can discuss what drivers, including sales efficiency, that's leading to this goal, and how much, if any, hiring do you need to do in sales and marketing to hit your now upper teen sales growth goal for next year? Well, on the cost side for the EBITDA, I mean, everything's driven off growth, and we've given you the growth in terms of, you know, mid- to upper-teens growth for next year. The operating leverage that we have on the business is, you know, the fixed cost really does drive that. So you can see in this quarter, we were at 39% EBITDA margin. We continue to grow. You're not gonna see a dollar for dollar in terms of cost. So we have, you know, the way we've had this model set up for 22 years with a lot of operating leverage, we're gonna continue to, you know, expand our margins, and we expect to see our EBITDA margin to be over 40%. In terms of sales efficiencies, you know, we're gonna continue to hire sales people because we believe in driving, you know, demand, and the demand is there, and it's there for, you know, for our taking. We feel that we're well equipped across, you know, our sales development rep, which are the entry level, to our field account executives, to our enterprise and our global reps across all regions. We'll continue to you know, beef up and invest in those across the board as well as our customer success team and our customer success account director team. You know, we're gonna ramp that up because we believe that the growth is there, the demand is there, and we're well positioned for the next several years to capture this. We don't see really a challenge in that. Okay, great. Thanks. Congrats on the strong results. Thank you. Thank you, Mr. Reilly. The next question is from Bryan Bergin with Cowen. You may proceed. Hi. Thanks. This is Zach Ajzenman on for Bryan. Just a couple questions. First on converting these non-Priority Engine customers. It's a bit of a follow-up, but obviously the performance in the non-Priority Engine business over the past 12 months suggests a notable uptick in activity and presumably new clients that have come on that side of the business. Any metrics you can share as it relates to converting these new clients? What initiatives are in place to convert these clients into longer-term Priority Engine users? That's a great question. Zach, what I would tell you is when we get these new customers, and we've seen a lot of new customers come in to this migration from face-to-face events, you know, into online. You know, we work very closely with them to understand, you know, how we go out there and capture our information. It might be a content syndication program, a webinar program, a branding program. It could be qualified sales opportunities. When we onboard them, you know, we are looking very closely and working very closely to highlight a lot of the intent signals and the intent data that's being delivered across these 90-day or 180-day programs. If you looked at our business, historically, a lot of our revenue might not be under subscription contracts, but it really does act as recurring revenue. It behaves that way. The game plan is to bring the new customers in with the demand that we're seeing and the success that we're having, work with them closely. We help them measure in terms of, marketing and sales engagement. They might be looking at MQLs and SQLs. We stay close to those folks. Because we have that recurring behavior, it becomes a conversation of, here's your AlwaysOn. You have access to not only what you're engaging with or what people are engaging with you on your content, but you can have the rest of the market that might not know who you are or might not be engaging with you when you hook on and sign on to a long term deal with Priority Engine. That's really the playbook. We've, you know, we mentioned that we were executing on that as we got into COVID and navigated through COVID. We're seeing a big demand for the products, as you mentioned, qualified sales opportunities, branding, lead generation, and that will be the playbook, and those are some of the metrics that we look at. That's helpful. Just to follow up on the net annual revenue retention figure. I think the last figure shown was about 120%. Can you just help us bridge the key underlying variables supporting that figure? How should we think about churn versus pricing versus upsell versus new customers? Just trying to get a sense of the underlying figure supporting that revenue retention number. Well, on the price increase for Priority Engine is roughly around 10%. That's, you know, so that's a piece of it. There's upsell across other products. It contributes as well. We're adding, you know, obviously we're getting more growth from adding new customers. It's primarily, you know, it's some price, it's some upsell, cross-sell. The cross-sell and upsell are primarily selling additional geographies and additional segments of Priority Engine. Understood. Thank you. Thank you, Zach Ajzenman. The next question is from Justin Patterson with KeyBanc Capital Markets. You may proceed. Great. Thank you. Two, if I can. First, just going back to the commentary on next year. It does say high teens or better growth. How do we think about the factors that could actually cause you to grow faster than that high teens number and get sustainably into the 20%+ range? That's question number one. Number two, last quarter you had the Xtelligent acquisition. I'd love to hear more about how you're thinking about that healthcare vertical. Thank you. Thanks, Justin. Well, so I'm gonna go backwards on the Xtelligent acquisition. We completed that deal on July 31st, and, you know, it was a market that we've been looking at for a while. As we mentioned in the last earnings call, the CEO from Xtelligent was an ex TechTarget employee, so we knew a few things on that. We knew the business was run pretty well. It was content led, it was opt-in permission-based audience, and it was a market that I'll call it a peripheral market, an adjacent market than what we've historically gone after. We believe as we go into 2022 on that, there is an opportunity for us to understand. Our plan is to execute and launch new Priority Engine segments across the healthcare, IT, intersection market. Also deliver and bring to bear the BrightTALK channel platform to those marketers in that industry. And we expect to be able to equip the sellers going after that to engage, penetrate, and grow that market. In terms of the 20%+ growth for 2022, I mean, we're thinking that if all the tailwinds continue to stay in our favour, we continue to execute. You know, we're seeing that acceleration of, you know, continuous acceleration from face-to-face events to online, modernization of our customer sales and marketing organizations. Google really promoting the elimination of third-party cookies and the budgets. The enterprise IT budgets remain healthy, that market remains healthy. We believe there's some upside on there. There are obviously some things that somebody mentioned earlier about supply chain management pressures and some other pressures that are really out of our control. You know, we have to make sure we're aware of those and we monitor that. But if those tailwinds continue to stay strong and we continue to execute, you could see above 20% growth. Great. Thank you. The next question is from Pinjalim Bora with JP Morgan. You may proceed. Oh, great. Hey, thank you, everybody, for taking my questions, and congrats on the quarter. I wanted to ask about competition. Since you have been focusing more and more on sales and intent signals around sales, are you seeing any change in the competitive environment since there are a few players who are doing the same? You know, we have a really unique position in the market because of the content and the opt-in permission-based audience, where people, our members are registered to come into what we're, you know, into our audience to become members. You know, when you talk about the sales market or the sales use case market, there are other players out there that do that. I think, you know, our ability to continue to drive marketing engagement, marketing investment, and then align and bridge marketing to sales because it's the same data, but it's being used differently, and a sales rep uses the data one way, and the VP of marketing uses the data another way. Being able to really get that bridge connected and visibility across sales and marketing is just a really unique capability set that we have because of that, you know, the content investment that we've made and the engagements that we've, you know, we've had in terms of first-party purchase intent data and our opt-in permission-based members. So there's always gonna be other data providers out there. Many times they are working in the same accounts that we are, and people understand that there's an investment for both sides of it. So I just think we're in a unique position to connect the bridge, connect the dots between sales and marketing and allow both of those departments within an organization to excel, know what each other, or know what each department is doing and benefit from it. Understood. One quick follow-up on the organic revenue growth guidance of high teens or better for 2022. Is there any way to kind of unpack the current organic growth given the few acquisitions you have done over the last 12 months? Yeah, I mean, we, you know, we report on one number, and what I can tell you is on the guidance on that or the insight is across all of our products, all of our regions, and all of our customer mix, you know, we're exceeding what we had previously thought we'd be doing this year. We don't peel it all back and look under it and say, "Okay, X amount was from this type of division," because we're selling it to the same customers, and we have an end-to-end solution that we're really focused on. I can tell you that we see strength across all the products in all the regions and all the customer mix that we have. Understood. I'll procede to the floor. Thank you. Thank you. The next question is from the line of Bruce Goldfarb with Lake Street Capital Markets. You may proceed. Guys, congrats on the great results, and thanks for taking my call. Just a question about M&A. You've been pretty active in the last 12 months with the BrightTALK and ESG in December 2020 and then Xtelligent, which you mentioned July 2021. Are you still looking to add pieces? You know, can you provide any update on your current plans? Or Yeah. Thanks, Bruce. Yeah, no, I appreciate it. We are always looking to be opportunistic in the market. When we look at potential acquisitions, you know, we look at a few things on this. We wanna make sure, you know, they have to fit a few of the criteria. Are they producing effective original content in the enterprise B2B tech space? Do they align or have a permission-based opt-in audience? Do they have first-party purchase intent data? Does it complement our existing revenue, product lines? Can we create and turn this into a subscription-based business? Then the last one is always the valuation. You know, if companies are up for, you know, sale and being marketed out there, does it make sense financially? We have a lot of conversations, and we are, you know, we're very prepared. We have. If you look at our balance sheet, it's a strong balance sheet. It's ready to take action when we see it. We won't go in a rush just to make a decision to make a purchase for a purchase sake, because we have a lot of momentum organically, and we wanna make sure we do not disrupt that. Those are the criteria that we look for and we continuously look for, and we're always in the market observing, talking, listening, and figuring out if it's a right fit for us. Thank you. Great. Thank you. In terms of, like, you know, like inflation, is there anything we should build into our estimates in terms of like increased costs for talent acquisition or travel expense or engineering? Are you guys? Yeah, I mean, that's a good question. I mean, you know, obviously if as the doors open up and we, you know, these borders open up and we have a little bit more travel, there's gonna be a little bit more travel, I would project in 2022 than it was in 2020 and 2021. There is a cost increase, obviously, with the projections. Talent acquisition. Yeah, I mean. You know, we've all seen what's going on in the world today. I mean, it costs more to hire people and get in the door right now. There might be you know, a slight uptick on that because we wanna make sure we're keeping the right people and recruiting the right people. you know, I don't know if it's a material number in the overall scheme of things, but if you're looking to build out a model over the next year, I think those are fair areas to look, assess and, you know, possibly update a little bit. Great. Thank you. You know, I don't know if you could provide any color in terms of 2022, in terms of like the% of revenue that you anticipate will be under a long-term contract? You know, that's a good question. We're looking at our long-term plan is to, you know, bring us from 40% to 50% over the next several years, and we're really focused on that. As we get these customers, as our customers come in and new customers that continue to invest in TechTarget, whether it's on a quarterly or semi-annual basis, we have a keen focus on making sure that they understand what they're getting, we're doing a good job of fulfilling, and we're migrating them into our, you know, long-term revenue stream. Our long-term plan, I mean, over the next couple, few years, is to still achieve 50%. I think we'll be, you know, well into 40% next year. That's where we're going and that's what we're focused on. Great. Thank you. That's all my questions. Congrats again on the fantastic results. Thank you. Thank you. Again, to ask a question, please press star one. There are no more questions at this time. That concludes today's Conference Call. Thank you, and have a great day.