Patrick Brickley: Yes. Hey, Terry. Right now we’re anticipating about flat in 2023 relative to 2022 and 2022 was up about 20% from 2021. So it was the delivery of non-recurring licenses as well as a lot of our services which are non-recurring. We had record amounts in 2022, specifically in Q4. We don’t anticipate setting new records as we enter 2023.
Terry Tillman: Okay. Thank you.
Operator: Our next question will come from Ryan MacWilliams with Barclays. You may now go ahead.
Ryan MacWilliams: Thanks for taking the question and good to see strong wins in CEM larger customers along with the sequential improvement in ARR. Patrick, how should we think about the year-over-year growth in ARR for 2023 as it relates to the revenue guide?
Patrick Brickley: Well hey, Ryan. We don’t guide to ARR, but we are, as we continue to focus the business on, we mentioned at our Investor Day on critical event management and on our sort of we have of getting 1000 customers, 250 ARR greater and working with our existing base to move them up the CEM stack. We want to see ARR growth in double digits, and as we work through headwinds and in terms of lapping the non-reoccurring revenue, we anticipate that that will translate into similar pace of revenue growth, but that’s going to take a number of quarters as we work through all of that.
Ryan MacWilliams: Excellent. And just on the free cash flow side, anything to think about as we move past the workforce structuring or maybe just any differences of how the free cash flow line could play out in 2023 versus 2022?
Patrick Brickley: Yes no, no major differences and the timing in 2022 was a little unique in that in Q3 we had a lot more operating cash flow than we usually do in Q3. And we — but some things happened in Q3 that would typically happen in Q4, but in terms of the full year, the results was what we had anticipated and in 2023 will be higher. The restructuring cash outflow will be almost entirely wrapped up in the first half of 2023 and we’ll continue to call that out so that you have clear line of sight to it. But beyond that, as our adjusted EBITDA grows, our operating cash flow will grow and our free cash will grow. The major differences between operating and free cash flow will continue to be the capitalized software development and that’s something that will remain relatively static in 2023 compared to 2022.
Ryan MacWilliams: I appreciate the color. Thanks guys.
Operator: Our next question will come from Parker Lane with Stifel. You may now go ahead.
Unidentified Analyst: Hi, this is Matthew Kicker on for Parker. Thanks for taking my questions. To start, you mentioned record gross retention rates despite reducing headcount. I’m just wondering kind of what led to that combination of outcomes? And you are not seeing a decline in that, right and do you expect that to continue into 2023?
David Wagner: Yes, that’s a great question, Matthew. Thank you. So that was not an all-time record, but highest in two full years. I really point the primary piece to the Board’s decision to pause material M&A and then our execution of the leadership team of really getting our arms around every customer renewal, whether it is the legacy Everbridge or newly acquired. And so I do expect, I think that’s the third important piece is that the customers are using our solution, liking it and retaining it. So I think there were just a couple of maybe a 100 basis points of execution improvement, the team was able to gather in as they paused material M&A and got the acquired cohorts really in command in the customer success motions that the company has used for years around its core cohorts.
