Marchex, Inc. (NASDAQ:MCHX) Q3 2024 Earnings Call Transcript

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We anticipate more product announcements as we move through the year. Additionally, we expect to win more new automotive customers and add meaningfully to our dealer channel as well as win more new relationships in home services and other verticals. The combination of these factors also reinforces our belief that we can and will grow sequential revenue as we move forward in 2024 as well as see ongoing bottom line progress. Furthermore, as our OneStack initiatives continue to advance, combined with other technology cost savings initiatives, we believe we are well positioned to enable greater overall operating leverage in the business. As our growth initiatives launch and gain traction, we believe we are in a strong position to see improvements in profitability measures into the future.

Thank you. And with that, I’d like to pass the call back to Edwin for closing remarks.

Edwin Miller: Thank you, Holly. As we work to define the future of conversational AI in our vertical markets, this is an exciting time to be at Marchex. I and the team have met with many of our customers so far this year and we’ll be spending more time with them in the coming months, collaborating around their AI and data analytics road maps. We have industry-leading direct first-party vertical market data that we’re able to leverage in new and innovative ways to create unique value for our customers. I am excited to see the demand for our product portfolio and innovative AI applications and there will be more to come during the year. I continue to believe there is a significant opportunity to grow meaningful in the vertical markets with our existing base of Fortune 500 and other customers.

We are focused on building our leadership position in the automotive and auto services vertical markets as well as scaling our other core verticals and ultimately translating all this into a 9-figure business. There’s more to accomplish but we are moving the ball forward every day. This year, you will see us complete significant infrastructure milestones and launch go-to-market initiatives that we anticipate will enhance our growth and accelerate our business in multiple ways. I’d like to thank our employees for their hard work and continued efforts to help us achieve our vision. With that said, operator, let’s move to questions.

Operator: [Operator Instructions] We have a question from Darren Aftahi of ROTH MKM.

Darren Aftahi: Great. Good to speak with you again. Two, if I may. Just first, on the overall business, there’s some puts and takes. You had some headwinds from call volumes you’ve kind of called out near term. If you had to guess, what do you think some of these re-ups and new wins that you’ve put on the tape start to kind of mask those tailwinds for good? Or is this a function of sort of one step forward, one step back until some of these new products are launched. That’s question one. And then on the commentary you guys made about your AI products and the pilots, I’m curious what steps need to occur in or for those pilots to become paying customers.

Edwin Miller: Thanks for the question. Let me start on the first question, re-ups, new wins, the pipeline is growing which is fun to see. The sales team has really aligned around the go-to-market motion. The product orientation and our ability to articulate the value of the data and analytics for our clients has a good uptake. So the funnel is growing. When it masked the kind of movement of some of the tailwinds or wind at our face, I think you’ll see in the second half this year what we’re saying, it will be sequential growth throughout the year. OneStack will change a lot for us, Darren and that one cloud. And I did read your report and you’re right, you’re spot-on. The fact that having everything with a single sign-on, with a single interface, with the ability for a client to see what they’re using and not using also should give us uptake from clients.

But that’s an easier sales process, if that makes sense, because they’re going to be able to see what it is they’re not consuming from our platform, that’s their data which is really cool. I think that the steps to get there for us and being successful is we’ve got to complete OneStack which we’re working toward, we’re doing pretty well. I think we’re probably approaching that inflection point as we move through 2024. And I think we’ll see wins throughout the year that will drive results. So my expectation is I think it’s a multi-tiered puzzle we’re solving which is fun and it’s good and we’re doing a great job, the team is doing a great job. As OneStack go-to-market motion align with that, alignment of product marketing and product management, you’ll see some new stuff on the Web coming from us and that single sign-on is going to make it much simpler for people to consume all of our signals and all of our products and we’re marching really well together toward that.

We made good progress in the past months, so I’m happy about what the team is doing.

Operator: We have no further questions, so I’ll turn the call back over to the management team for any closing remarks.

Edwin Miller: Okay. Well, Darren, thank you for the question. And I guess we’ll catch up here shortly but good to hear your voice. And thank you for all of our investors and thank you again for all of our employees doing the lift and speak again soon. Thank you.

Holly Aglio: Thank you, everyone.

Operator: This concludes today’s call. Thank you for joining. You may now disconnect your lines.

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