HireRight Holdings Corporation (NYSE:HRT) Q3 2023 Earnings Call Transcript

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But when you look at just within our SMB customer base quarter-to-quarter, it was down much more in line with the broader business about 10%. So, I want to make sure people understand that because I don’t think everybody kind of grasps that, right? So the SMB business itself was down about 10% to 11%, similar with the rest of the business. As a contribution to the overall growth algorithm, it represents a decline year-over-year. Does that make sense?

George Tong: Yes. That’s helpful. And how would you say the trends progressed over the course of the quarter with SMB? Was there any noticeable separation from enterprise?

Tom Spaeth: No. No, very, very consistent. Very consistent as Guy mentioned. We look at it more in macro chunk sector. We can’t analyze 30,000 customers individually.

George Tong: Right. Okay. Got it. That’s helpful. And then with margins, you talked about initiatives to improve automation and efficiencies. As you think about the roadmap ahead, what are your top one or two priorities to further that journey of automation? And which inning would you say you’re in, in terms of realizing your targeted efficiency levels?

Guy Abramo: Sure, George. Good question. As a baseball fan, I’d say we’re in the third inning.

George Tong: Okay.

Guy Abramo: It’s a long game. But primarily, I would tell you that our AI work is really bearing some fruit. And a lot of that is — so I don’t want to just lay in the buzz, the buzz phrase of AI. A lot of that is our data matching algorithms that assist researchers with ensuring that a specific element of data can be attributed to a specific candidate and then, in fact, especially on criminal work, right? One of the things you’ve always heard me talk about is there — if you take driving under the influence, there’s 400 different classifications for DUI and criminal jurisdictions all around the world, multiplied by 25 different languages that you’re using. So, starting to see success specifically with some natural language processing, ensuring that a data match occurs for a specific candidate.

And that is the labor savings from two different places. One is it allows us to eliminate labor from the team. But the second thing it also does is allows labor to be more and more productive and more accurate in the results, which is our goal. Our goal mainly is to improve performance for clients, improve accuracy and improved turnaround time. The benefit of that work is it also happens to reduce cost. We’ll continue that forever. I would tell you, there will always be something else to do in that area.

Operator: Thank you. At this time, I’d like to turn the floor back over to Mr. Abramo for closing comments.

Guy Abramo: All right. Thank you, Operator. And I just want to thank, everyone, for joining the call this morning. We look forward to finishing out the year and keeping you posted on our progress as we continue to execute specifically against these uncertain times. So enjoy the rest of your day, and please do not hesitate to reach out with any questions. Thanks again, everybody.

Tom Spaeth: Thank you.

Operator: Ladies and gentlemen, this concludes today’s event. You may disconnect your lines at this time or logoff the webcast and enjoy the rest of your day.

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