CCC Intelligent Solutions Holdings Inc. (NYSE:CCCS) Q2 2023 Earnings Call Transcript

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Gabriela Borges: Good afternoon. Thank you. Githesh and Brian, we talk about the consistency and the durability of growth in the business model every quarter, so I [indiscernible] off you as reflective of the year-to-date, what has surprised you? Where are you seeing things that may be more technology adoption to the upside? Is there anything that surprise you to the downside? Just a little bit of a reflection on how the year has gone relative to your internal plan?

Githesh Ramamurthy: Yes. Maybe, Gabriela, I’ll take that first, and maybe, Brian, you can add to that. Part of having done what we’ve done for a fairly long time is that our business fundamentally tends not to have too many surprises and which means many of the trends that we’re seeing either in terms of technology or things that we’re able to see with the visibility of the data that comes through the platform, we’re able to see that. With this said, one thing we are seeing, I would say, at a macro level, is that when we talk to our clients across the entire economy, whether it is OEMs, car companies, parts providers, insurers, repairers, the general sense of leaning in to use technology more aggressively than they were in the past to improve efficiency and to solve for shortage of labor, that is one that we are consistently seeing across the board.

Again, it doesn’t necessarily change things on a week-to-week or month-to-month or quarter-to-quarter, but having seen this for a long time, we are seeing much more acceptance of being able to deploy process efficiencies and tools to deliver a differentiated customer experience. I don’t know, Brian, if you want to add anything to that.

Brian Herb: No, I think you’ve covered it well. I would just also highlight just the — clearly, at the macro, there’s a lot of — it’s a dynamic marketplace we’re operating in. That said, we have really good client engagement and overall, a lot of positive feedback from clients and how we’re engaged with them. So, I think that’s just another important thing that’s happening with our business in a dynamic marketplace.

Gabriela Borges: Good to hear. My follow-up is on the Casualty business. I believe last quarter, you talked about casualty volumes impacting about one point on the NRR. How should we think about casualty volumes on a quarter-to-quarter basis? And any volatility in that metric? And as you gain momentum in casualty, would love to hear what you’re seeing in terms of competitiveness front from the one or two incumbents will have good positions in that space? Thank you.

Brian Herb: Yes, on the casualty, maybe I’ll let Githesh talk around the competitive point. I would just say from a — the revenue performance, Q2 came in line with expectations and performed well. We’re happy with the overall performance of casualty. We’re happy with the momentum that we’re seeing across casualty and the ongoing strength, and so we feel good on where we landed with Q2. We feel good on what’s ahead of us in the second half of the year. . Maybe one small point of clarification. We talked about the casualty impact in Q1. Casualty is not in our NDR calculation, Gabriela, just as a point of clarity. When we referenced it in Q1, it was in reference to total growth and the overperformance in Q1, so just a small little mechanical point there.

Githesh Ramamurthy: Yes, Gabriela, regarding the second part of your question, we never underestimate what others are doing. And we do have history in whether it is in the repair facility side of the business or the auto physical damage side of our business with insurers of really focusing on incredible innovation and differentiation in terms of what results we can deliver. And so much of the work we’ve done over the last several years to position our casualty platform including some of the AI examples that I talked about earlier, we think those are really helping to differentiate us. And also remember, that many parts of the system where the processing is still manual and a lot of manual handoffs and other things taking place, a lot of bills coming in are still paper coming in. So, there’s just a lot of opportunity there as well.

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