Sprout Social, Inc. (NASDAQ:SPT) Q2 2023 Earnings Call Transcript

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Ryan Barretto: Yes. Thanks. With 30,000 plus customers, there has certainly been some overlap. But I would categorize it as one where we think we have a lot of upside for both. So, upside for both landing, net new customers for both organizations, as well as being able to cross-sell from Spourt core to Tagger, and vice versa, going to Tagger customers and being able to sell core Sprout. So, we see quite a bit of opportunity on both sides of that. And then as you might imagine, with the overlap, that there was some opportunities for us to just go back to our customer base and get feedback from some of our customers that are leveraging the product which made us even more confident about the fit with Tagger and Sprout.

Elizabeth Porter: Got it. And then hoping to get some color just higher level NRR trends that you guys may be seeing more recently. Across the software space, we are seeing more optimization of spend. You are also kind of benefiting from the mix to hire deeper wallet customers. So, any commentary on just how some of those positive or negative factors may be impacting your current NRR, any change in trajectory?

Joe Del Preto: Yes. So, I think Elizabeth, I think a couple of comments there. One, I think when you think about the move up into the mid market enterprise and Ryan talked about that, the attach rates, 160 basis point improvement. And the growth we are seeing now, we are really confident that the NRR we are seeing in that part of the market is really strong and actually improving. And obviously, that’s offset probably by we have talked about in the last couple of quarters is that, the turn on the low end of the market, obviously, will impact our overall NRR. But we are overall happy about the progress we are making up-market, knowing that we made the strategic change that was going to kind of put pressure on the low end of the market that’s impacted NRR as well.

Elizabeth Porter: Got it. Thank you.

Operator: I would now like to turn the call over to Justyn Howard for closing remarks.

Justyn Howard: Alright. Yes. Thank you. And thank you everyone for your time today. We appreciate the opportunity to be talking about and providing some more visibility into this important transition for us. We are certainly very excited about all of the positive momentum that we are seeing in the parts of the business that we are focused on and being able to see the benefits of a lot of the strategic changes that we are making. So, we are excited to be able to continue to add clarity there. And look forward to doing more of that. Just as a reminder, September 27th, Investor Day, we will look forward to talking more about the future, what we have planned, and giving you some more visibility into how we are going to get to that $1 billion revenue mark, and a lot of the other exciting things that are happening in the business. So, we look forward to seeing you all there. Thanks everyone for your time today.

Operator: Thank you. Ladies and gentlemen, this does conclude today’s call. Thank you for your participation. You may now disconnect.

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