Crexendo, Inc. (NASDAQ:CXDO) Q4 2022 Earnings Call Transcript

Jon Brinton: Yes. So one of the areas that we can already see some fruit of that is that Allegiant had a greater level of expertise in the omnichannel CCaaS offerings than we did within our core business. So we’re already leveraging their employees and associates that were in that business now to help us deploy those services, to scope them with customers and we talked about earlier, we’re having good success there. And those opportunities are all really greenfield to us from a share-of-wallet perspective. And then when you look at their portfolio, they have several other services that are really interesting for us to be able to offer through our partners in an expanded distribution. And we’re working on bringing those through our system to deploy them through our Crexendo retail offerings and in some cases even looking at ones that we could offer to our other platform licensees.

So we’re really excited about being able to drive more through our offer, expand our average billings per customer based on additional offerings through Allegiant.

Mike Latimore: Great. And then just last one. Did you have a price increase at the start of this year and maybe just a little more detail ?

Doug Gaylor: Yes. So for our licensee applications out there, we are anticipating a price increase that was not announced to the community yet, so thanks, Mike, for giving them a heads up on that. But we do anticipate a little bit of a price increase coming down the pipe for our licensees that’ll be announced soon.

Operator: The next question is coming from Chris Sakai with Singular Research.

Chris Sakai: Just first question I had, can you go over the reasoning again as far as the dividend — for stopping the dividend and what will you use that money for now?

Jeff Korn: Yes, Chris. As you know, we’re a microcap business and we’re in a growth industry and we think there are better uses for the money than paying a dividend. We could use it for anything from a stock buyback to buying companies which would be accretive to using it as investment in technologies. We thought at this point of our growth trajectory, there were just better uses of the money. It doesn’t mean if we start throwing off a ton of money, we might not look at it again but right now we have to manage to where we are. And at this point, it just didn’t make a lot of sense to us to continue it.

Chris Sakai: Okay, that sounds good. For future acquisitions, what can we expect for 2023?

Jeff Korn: Well, Doug always talks about the fishing pond. We often have people in our Software Solutions community who reach out looking for an ability to sell their business. We reached out to other people. Obviously something within the community is almost immediately accretive to us, so that would be our primary interest. But we will look at any appropriate accretive acquisitions that come along.

Chris Sakai: Okay. And then you mentioned growth out of Europe. Can you mention or talk about how much market share do you have there and same in Australia and will that grow in the future?

Jeff Korn: It’s not large yet but we’re hoping to change that.

Doug Gaylor: It’s not large yet, Chris, as I said, the contributions outside of the U.S. domestic market is not material in our financials at this point but we do see tremendous opportunity for growth there. So when we look at the opportunities, I think we’ve got 18 logos, maybe 20 logos internationally, most of those in the U.K. and European market, 4 in Australia, 2 in New Zealand, 1 in the Philippines. So we continue to see opportunities there. If you think about BroadSoft and Metaswitch owning the majority of the markets out there from a platform perspective, they are notoriously tough to deal with and very expensive to deal with. And so when people are looking for alternatives for the platform, we are the third largest platform provider and the fastest-growing platform provider domestically.