MANH - NASDAQ

Good afternoon. My name is Rob and I'll be your conference facilitator today. At this time, I'd like to welcome everyone to the Manhattan Associates First Quarter 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer period. [Operator Instructions] As a reminder, ladies and gentlemen, this call is being recorded today, Tuesday, April 23, 2024. I will now introduce your host, Mr. Michael Bauer, Head of Investor Relations of Manhattan Associates. Mr. Bauer, you may begin your conference.

Thank you, Rob, and good afternoon, everyone. Welcome to Manhattan Associates' 2024 first quarter earnings call. I will review our cautionary language and then turn the call over to Eddie Capel, our CEO. During this call, including the question-and-answer session, we may make forward-looking statements regarding the future events or the future financial performance of Manhattan Associates. You will caution that these forward-looking statements involve risk and uncertainties are not guarantees of future performance and that actual results may differ materially from the projections contained in our forward-looking statements. I refer you to the report's Manhattan Associates files with the SEC for important factors that could cause actual results to differ materially from those in our projections, particularly our annual report on Form 10-K for fiscal year 2023 and the risk factor discussion in that report as well as any risk factor updates we provide in our subsequent Form 10-Qs. We note the turbulent global macro environment could impact our performance and cause actual results to differ materially from our projections. We are under no obligation to update these statements. In addition, our comments include certain non-GAAP financial measures to provide additional information to investors. We have reconciled all non-GAAP measures to the related GAAP measures in accordance with SEC rules. You'll find reconciliation schedules in the form 8-K we submitted to the SEC earlier today and on our website at manh.com. Now I'll turn the call over to Eddie.

Terrific. Thanks, Mike. Well, good afternoon, everybody, and thank you for joining us as we review our first quarter results and discuss our increased full-year 2024 outlook. Manhattan is off to a solid start in 2024, once again reporting record results. Q1 total revenue increased 15% to $255 million, and adjusted earnings per share increased 29% to $1.03, both exceeding expectations. Driving top-line out performance and earnings leverage was 36% growth in cloud revenue and 14% growth in services revenue. Well global macro uncertainty and volatility certainly persists. Manhattan's business fundamentals are solid. Our teams continue to execute well for our customers, and our steady investment in research and development has firmly established Manhattan as the leading innovator in supply chain execution, omni-channel solutions, and retail point of sale. RPO, the leading indicator of our growth, increased 31% to just over $1.5 billion. As demand for our mission critical cloud solutions remain strong and resilient across our product portfolio. From a vertical perspective, retail, manufacturing, and wholesale drove more than 80% of our bookings in the quarter. Across our solutions, the sub-verticals are pretty diverse. For example, in the quarter, cloud deals won include an omnichannel multi-brand retailer, a manufacturer and distributor of golf equipment, one of the world's largest airlines, a paint manufacturer, an apparel and accessories retailer, a tire distributor, as well as a number of others. For the quarter, competitive win rates were solid at about 75%. And we experienced strength from new customers with approximately one-third of our new bookings being generated from net new logos. That's in addition to healthy new logo activity, we continue to experience a good mix of conversions, upsells, and cross-sells. And while the timing of large deals and the mix of bookings is certainly going to vary on a quarterly basis, we believe our bookings breadth from both new and existing customers and also across our product portfolio exemplifies our multiple opportunities for sustainable growth. Now to this point, our solutions pipeline remains robust with new potential customers representing approximately 35% of the demand. An important driver to our growth is our ability to deliver industry-leading solutions to service our customers. At best of breed, cloud-native platform solutions provide unmatched access to innovation and are uniquely capable of unifying mission critical commerce and supply chain functions. This is differentiating for us and helps our clients improve customer service and loyalty, drive more revenue and improve efficiency. Now product sales activity also drives our services growth and pipeline. In Q1, our professional services team completed over 100 go lives and continues to execute very well for our customers. And while we remain appropriately cautious on the global economy, we continue to invest to drive growth. This includes strategic investments in industry leading innovation, further enablement of our customer success, and the expansion of our addressable market. From a hiring perspective, in Q1 we've welcomed over 100 highly talented individuals into the Manhattan family, and are on track to meet our 2024 hiring goal of a few 100s of associates. Now let's turn to some quick updates on our products. Last quarter, I focused on some key updates to our omni-channel commerce solutions. So for this quarter, I'll focus most of my time on updates to our supply chain execution products. One of Manhattan's guiding principles is a relentless focus on innovation. We've found the move to evergreen software to be a real game changer for both our teams and our customers. Our quarterly release process allows our customers to benefit from new features in record time. Each quarter we deliver a combination of smaller, more tactical features focused on customer enablement, as well as larger, more strategic features, which create an operational step change for our customers. Within Manhattan Active WM, we released several of these larger, more strategic features in region quarters. Now, you may recall that we announced yard management at last year's Momentum Conference, and we're seeing great reaction and adoption for this best-in-class YMS. Manhattan Active Yard Management helps out where it has operators enjoy the same level of process discipline and optimization in the yard as they've had within the four walls of the distribution center. Yard Management also serves to further reinforce process unification between warehouse management and transportation management, allowing for the seamless transition of a trailer moving from transportation management control to warehouse management control. A unified yard offering is an important step in helping our customers evolve toward managing an end-to-end flow of inventory, in band from their suppliers to the distribution center and out band from their distribution centers to their customers. But as I mentioned earlier, we released yard management just a little less than a year ago. So the question is, what have we done for our Manhattan Active WM customers lately? Well, in January, we released Dynamic Load Building for Manhattan Active WM, a feature that not only optimizes the way the cartons are palletized and optimized, but also the way that they're laid out in the trailer, considering temperature, axle load, vehicle stop sequence, and so on. Dynamic Load Building is a pretty critical process in industries like grocery, food service, industrial distribution, and a number of others. And many of our customers in those industries have historically used third-party tools or even manual processes, but now they're able to take advantage of load building right within Manhattan Active Supply Chain execution as part of a unified planning process. The release of new strategic capabilities like yard management, dynamic load building, along with in-app analytics and embedded generative AI is one of our most important market differentiators. Given that strong track record of delivery, prospective customers understand that a subscription to Manhattan Active WM, for example, delivers more than what they saw in the initial product demonstration in RFP response. They're also subscribing to a continuous innovation pipeline built on design thinking principles and conducted in collaboration with some of the most forward thinking supply chain practitioners. Customers rest assured that their investment in innovation will continue to deliver industry leading features, all seamlessly woven into the Manhattan Active WM environments and ready for them to activate. Now, further on the supply chain front, we continue to see great results from the activation of our Manhattan Active Transportation Management application, which recently was named a leader in the Gartner Magic Quadrant for TMS, six consecutive year, by the way. And as a reminder, this solution is now live on four continents, serving industry-spanning grocery, food service, convenience stores, consumer products, apparel retail, and a number of others. And frankly, our supply chain unification message continues to resonate very well in the market. And to that end, one of our key deals from last year was with Schneider Electric, a multinational, multibillion dollar corporation that specializes in digital automation and energy management. And we're currently working with Schneider to deploy a unified supply chain execution offering all the way across the globe. We're starting with a distribution center in the Netherlands, and Schneider shares their vision for unified inbound and outbound supply chain processes. In fact, they'll be sharing their vision in more detail at our customer conference Momentum next month. And finally, speaking of Momentum, we're planning a couple of major product announcements for an event in San Antonio, Texas. And we're looking forward to unveiling those major steps forward to both our Manhattan Associates and our Manhattan customers. And I'll look forward to telling you more about them in next quarter's update. So that concludes my business update. Dennis is going to provide an update on that financial performance and outlook, and then I'll close that prepared remarks with a brief summary before we move to Q&A. So Dennis?

Thanks, Eddie. Our Manhattan Global teams continue to execute well in a challenging macro environment. For the quarter, we delivered a strong, balanced financial performance across top and bottom lines. This includes posting record results across RPO, revenue, and adjusted operating income. On an as-reported basis, our Q1 results compare favorably to the rule of 40. And if our revenue growth is normalized for our cloud transition, which excludes license and maintenance revenue, our results exceed the rule of 50. FX had a minor impact in the quarter with a 1% headwind, while it was neutral to year-over-year revenue and RPO growth. Now turning to our Q1 results, our growth rates are reported on a year-over-year basis unless otherwise stated. For the quarter, total revenue was $255 million, up 15% excluding license and maintenance revenue, which removes the compression driven by our cloud transition, our total revenue is up 20%. Cloud revenue totaled $78 million, up 36%. And as Eddie highlighted, we ended the quarter with RPO of $1.5 billion, up 31%, compared to the prior year, and up 6% sequentially. Removing the impacts of FX, the Q1 sequential increase of $97 million in RPO exceeded the sequential increase we achieved in Q4. The strong Q1 performance was driven by a healthy mix of sales from both new and existing customers with solid results from across our Manhattan Active suite of products. And our global services teams delivered record revenue totaling $132 million, up 14% as cloud sales continue to fuel services revenue growth globally. Adjusted operating profit was $80 million with adjusted operating margin of 31.3%. This is 250 basis points year-over-year -- up year-over-year. Our performance was driven by strong cloud and services revenue growth combined with operating leverage as our cloud business continues to scale. Importantly, as Eddie discussed, we continue to invest in innovation to drive sustainable long-term growth. Turning to EPS, we delivered Q1 adjusted earnings per share of $1.03, up 29%, and GAAP EPS of $0.86, up 39%. And moving to cash, operating cash flow was a solid $55 million. This is down slightly from the prior year period due to a record 2023 cash bonus payout and timing of cash collections. This resulted in 21% free cash flow margin and 32% adjusted EBITDA margin. Regarding the balance sheet, deferred revenue increased 21% to $265 million. We ended the quarter with $208 million in cash and zero debt. In the quarter, we leveraged our strong cash position and invested $73 million in share repurchases. Additionally, our Board has approved the replenishment of our $75 million share repurchase authority. That covers the summary results. Now on to our updated 2024 guidance. As consistently mentioned, our financial objective is to deliver sustainable double-digit top line growth and top quartile operating margins benchmarked against enterprise SAS comps. These are important drivers to our best-in-class return on invested capital as we maintain a balanced investment approach to growth and profitability. With our solid start to the year and increasing visibility, we are raising our 2024 revenue operating margin and earnings per share guidance, which can be found in today's earnings release. We are also reiterating our 2024 RPO target range and midpoint of $1.78 billion. As noted on prior earnings calls, our objective is to update our RPO outlook on an annual basis. And lastly on RPO, as previously noted, our bookings performance is impacted by the number and relative value of large deals we close in any quarter, which can potentially cause lumpiness or non-linear bookings throughout the year. With that, for the full-year 2024, we expect total revenue of $1.026 billion to $1.034 billion, with a $1.03 billion midpoint comparing favorably to our prior outlook and representing 17% growth, excluding license and maintenance and 11% all in. For Q2, we are targeting total revenue of $254 million to $258 million, which at the midpoint represents 17% growth, excluding license and maintenance attrition and 11% growth all in. For the rest of the year, at the midpoint, we are targeting total revenue of about $263 million in Q3 and accounting for retail peak seasonality, $256 million in Q4. For adjusted operating margin, we are increasing the midpoint to 29.75% from our prior midpoint of 29%, which includes a 170 basis point headwind from our license and maintenance revenue attrition to cloud. And as Eddie highlighted, given the combination of our demand and size of our opportunity, we continue to invest in our business. At the midpoint, adjusted operating margin on a quarterly basis is expected to be about 29.5% for both Q2 and Q3, and accounting for retail peak seasonality 28.5% in Q4. This results in our full-year adjusted earnings per share range to increase to $3.86 to $3.94. On a quarterly basis, we are targeting Q2 earnings per share of $0.96, Q3 $0.99, and accounting for retail peak seasonality, $0.93 and Q4. For GAP, earnings per share are midpoint ticks down $0.04 to $2.82 on higher investment and equity-based compensation. For Q2, we are targeting GAAP earnings per share of $0.66. Here's some additional details on our 2024 outlook. We are increasing our cloud revenue midpoint to $332.5 million, representing 31% growth. On a quarterly basis, we are targeting $80.5 million in Q2, $85 million in Q3, and $89 million in Q4. For services, we are increasing our forecast to $538 million to $544 million, with $541 million midpoint representing 11% growth. On a quarterly basis, we are targeting Q2 services revenue of $137 million, Q3 $140 million, and accounting for Q4 retail peak seasonality $132 million. For maintenance, we are targeting a midpoint of $124.5 million, which represents a 14% decline. On a quarterly basis, we are targeting Q2 at $31 million, Q3 $30 million, and Q4 $28.5 million. For consolidated subscription, maintenance, and services margin, we continue to target about 100 basis points of margin improvement for the year. And finally, we expect our tax rate to be 21.5% for the balance of the year. Our diluted share count to be 62.5 million shares, which assumes no buyback activity. So in summary, a solid Q1 performance by the Manhattan Global Team. Thank you and back to Eddie for some closing remarks.

Yes, terrific. Thanks, Dennis. Well, look, we're very pleased with that solid start to the year and that record Q1 results. We continue to be appropriately cautious, I think, on the volatile conditions that are out there. But that business momentum remains very favorable, and we remain certainly optimistic about the business opportunities that is in front of us. So thanks, thanks everyone for joining the call, and thank you to our Global Team for all the exceptional work that you do for our customers. So that concludes our prepared remarks, and Rob, we'd be happy to take any questions.

Thank you. [Operator Instructions] Thank you, and our first question is from the line of Terry Tillman with Truist Securities. Please proceed with your questions.

Yes, thanks for taking my question. And good afternoon here, Eddie, Dennis, and Mike. First and foremost, great disclosure there on the FX impact to RPO, that's really helpful. So I guess the constant currency adjusted numbers $97 million, so thanks for the disclosure. Just the first question maybe for you, Eddie, is on the -- just an update on stats on Cloud WMS. I got knocked off the call, so I may have missed it. I don't know if you said anything, but I think last quarter when asked about it, you gave something in terms of maybe sites that are up and running, but just anything you can share, whether it's sites, whether it's conversations with some of the folks that hesitated to move going forward. Just would love some statistics that you can share on just where you are on Cloud WMS adoption? And then I had a couple of follow-up.

Yes, sure, sure, sure. Terry, I think if we just a little bit of license, we're going live quite frequently with sites these days. So the live site count is right at about 225. Actually, I think it's a little bit more than that, but close enough for this conversation 225. And there's certainly no reticence in terms of moving to the cloud, either for new customers, of course they're moving directly to the cloud with us, or our existing customers that are converting and migrating over time. Some are moving pretty aggressively, frankly. We've got customers that are going more than one site a month on a global basis going live. These are large, automated, be it a million square foot facilities and so forth. So yes, just strong momentum there. We're working hard to keep up with the demand.

That's great, and maybe just a follow-up, and then I had a question for Dennis on the free cashflow. But just, Eddie, in terms of version of software and your customers starting to experience this and kind of the zero downtime, is it starting to kind of accelerate the conversations? Because you all have this vision for your customers of Unified Commerce, but is it starting to kind of accelerate the conversations on well, okay now we have the WMS it really does make sense to do the TMS or OMS. I'm just curious where you are on that's starting to manifest in cross selling and upselling?

Yes, you know, I mean it definitely is. You know, we say over and over and over again, these are enterprise class systems. You know, you don't see immediate hockey sticks and so forth, but we definitely see it. In fact, I mentioned Schneider Electric in my prepared remarks. They've actually bought both WMS and TMS simultaneously. You've got a very large global rollout of unified supply chain execution for you know for those guys they'll be talking about a, you know, momentum. And you know there's no question that we're starting to see that unified message pick up momentum, I don't think there is a conversation that we have with either a customer or you know a new logo prospect about TMS that doesn't include WMS and about WMS that doesn't include TMS. Again, they may not all be like Schneider Electric buying both together, but the conversations are certainly conjoined.

Thanks for that Eddie. And Dennis, I guess on cash flow, you called out the largest, you know, kind of cash bonuses in the seasonality and impacting cash flow. But, you know, is 2Q something that sequentially, anything you can share about how to think about it or just maybe even full-year on how you're thinking about maybe a free cash flow margin? Thank you.

Yes, so Q2 will snap back from Q1 definitely 25%to 26% free cash flow margin on a full-year basis. We may tick up from that. There's a little bit of conservatism there.

Wonderful. Thank you.

Thank you, Terry.

Our next question is from the line of Brian Peterson with Raymond James. Please proceed with your questions.

Hi, gentlemen. Thanks for taking the question. So Eddie, you mentioned some examples of global supply chain investments for customers with Manhattan. You know, I'm curious for somebody that has a truly global project that's hitting multiple DCs, how long does that product or project take? Is that something that can be done in a few years or is the timeline usually longer than that?

Yes, well that's a great question and there's no perfect answer, Brian, frankly. It really depends on the size and the magnitude of course. Look, if I were to pick how long does it take to roll out a unified supply chain execution program, both WMS and TMS, let's assume 30, 40, or 50 distribution centers, something like that. That's probably a three-year program, I would say. You know, could be a little longer, probably not going to be shorter.

Got it, okay, that helps a lot, actually. So, it just made me follow-up, I know this is more on the supply chain execution side. But point of sale, some really strong stats to share last quarter. Curious what the feedback has been from customers and prospects to start in 2024. Thanks, guys.

Yes, yes. Continues to go well from an execution perspective in the field. I think we brought a couple of new customers live this quarter. We did secure one nice deal, one nice new logo deal in the quarter. Very pleased about that. I think we've reported this same scenario before. This is a brand new customer. We've never done business with them before. And the only product that they bought from us was point of sale. So it stood alone on its own merit. I forget exactly, but I think it's right around a 225 store chain. So we're looking forward to getting that project rolling as well. So continuing to see strong momentum in the field both from an execution, a go live, and a nice little bit of sales motion there as well.

Great to hear. Thanks, Eddie.

Yes. Thank you, Brian.

Our next question is from the line of Joe Vruwink with Baird. Please proceed with your questions.

Great. Hi, everyone. Thanks for taking the questions. One up front, just on the composition of RPO bookings across WMS, OMS, TMS, have your expectations changed at all in terms of the relative share of what's flowing into your backlog just given how the era started?

No, I would say, you know, advances by quarter. You know, we talk about that all the time, Joe. But in terms of the makeup, I think we expect it to be pretty consistent. The way I think about it is on an annual basis, it'll branch around quarter-by-quarter.

Okay, great. And then active WM, that debuted in the spring of 2020. You saw a pretty nice step up in RPO bookings really towards the end of that year and then certainly 2021. So the early adopters at this point, they're in year three, year four some are maybe coming up on renewal conversations, but certainly many are far enough along and live where you probably engage with the new cloud installed base just on cross-selling? How has that experience, both experience at renewal and then maybe net retention experience over the course of that initial five years so engagement. How has that fared so far and does it change at all kind of the evolution of your model as more of the model is just going to reflect cloud financials and how the renewal base is evolving over time?

Let's see, quite a bit packed in there. But we haven't seen, obviously, material renewals just yet. Because to your point, we haven't even quite met the four-year mark for launch. So next year and the year after is when we'll start to see more of the renewals, that renewals. Net retention rate is very, very strong. Cross-sells, we're pleased with. I know I'm a bit of a broken record here, but again, banks are around a little bit quarter-by-quarter. You know, this quarter I think the cross-sells were in the 20%, maybe just a tick above 20%, that seems to bounce around, frankly, between anything from 15 to 35 on a quarterly basis, but usually settles in annually to be around about 25% cross-sell, upsell.

Great. I'll leave it there. Thank you.

Okay, thank you, Joe.

Our next question is from the line of Mark Schappel with Loop Capital. Please proceed with your questions.

Hi, thank you for taking my question. Eddie, could you just provide a little bit of an update on the Shopify partnership that was announced recently, specifically with respect to the product integration efforts?

Yes, sure. Sure, I'd be happy to, Mark. So we announced that at NRF in earnest and seen a lot of interest around the Shopify partnership. I'll try to make it short. The gist of it is that Shopify sees an opportunity for them to come up into the enterprise with their web store and e-commerce storefront. We obviously are a great partner for them because they would love to be able to integrate directly into our enterprise class order management system and get after our enterprise order management system customers. So that's, sort of, great news for them. We think there's going to be, over time, a wave of e-commerce platform replacements, given some of the older systems have, kind of, fallen off of the wayside and so forth. Obviously, Shopify do as well. And we'd like to attach to that replacement cycle as it happens over the next few years, hence the benefit of the partnership for Manhattan Associates. You know, we've busily been building standard integration and out of the box integration with Shopify and our R&D teams on both sides have been working very closely together and seems to be -- it is seems to be an -- it is a very productive relationship and partnership. And looking forward to seeing what comes of that in the future. It will feature as one of the things that we talk about in a little more detail, momentum with our existing customers as well. And I think it'll be interesting for them.

Great, thanks. And then growth in the Asia-Pac region seemed a little bit softer this quarter than maybe in the past. I was wondering if we should read anything into this, or is this just quarterly variability in the numbers?

No, it was actually pretty strong this quarter. Now, as you know, APAC for us is in the 6% to 10% of our revenue, so it can be a little bit on the smaller side from an actual numbers perspective. But we had a good quarter, frankly, good margins, and the pipeline looks pretty good in APAC as well, maybe with the exception of China where things are not quite as strong for us.

Great, thank you. That's all.

Okay. Thank you, Mark.

Our next question is from the line of George Kurosawa with Citi. Please proceed with your questions.

Thanks for taking the questions. Happy to be on the call. Maybe just high level on the demand backdrop. You guys described kind of a volatile environment that you're executing through. Maybe you could just double click on kind of what you're seeing there relative to what you saw last quarter and if there's kind of any particular vertical that you described as maybe seeing a little more impact? Thank you.

I would say no, George. And look, the macro -- the volatility that I'm referring to is the exact same volatility that every single company on the planet is observing. Look, I'm going to repeat myself from, I think, last quarter, 12-months ago, there was a healthy amount of macro volatility and so forth around the world. And it seems to us that none of those have come off the table, but more issues have been added to the mix, just hence the reference to the volatility and so forth. But it hasn't had a particular impact on any vertical. For us, as I pointed out in some of the wins for the quarter, we've got pretty good diversity across airlines and paint suppliers and golf equipment, retailers, and so forth. So we feel pretty good about the diversity and how we can smooth out some of that volatility. But I think it would be inappropriate for us not to mention you know all of the you know the backdrop of the things that are going on around the world.

Got it that makes sense. And then just on the updated guidance obviously flow through, you know, mostly upside for quarter, but you know thinking about the back half the year maybe a very slight tweak down maybe just any puts and takes and how you're thinking about the rest of the year?

Not a big change. I mean, Dennis obviously highlighted the FX challenges. We've already seen in Q1 since we did our budgets and put the plans out. That was just a little bit disappointing, frankly. It's not a material change. We made it clear that we're only going to provide our annual RPO guidance. Now, we did say for the year that our growth would be at about $360 million in RPO growth, $90 million a quarter. In constant currency, we did $97 million in RPO growth for the quarter, so kind of a little bit ahead, again, constant currency-wise. But no material change in, and I look forward for the year at the moment.

George, we like to under-promise and over-deliver, so there's not a material adjustment in the back half of the year.

Got it. Makes sense. Thanks for taking the questions.

Sure thing, George.

Our next question is from the line of Dylan Becker with William Blair. Please proceed with your questions.

Hey, gentlemen. Great to connect to you. Appreciate you taking the questions. Maybe, Eddie, starting with you, we've talked a lot about, kind of, the continued investment and innovation and what that can create from a cross-selling perspective, given kind of this cloud migration, can unlock some of this. I wonder how you were thinking about the like blueprint phase and the importance of that dynamic of services in not only getting the customers live, but maybe giving like a bit of a peek under the hood and maybe a strategic source of helping inform some of those R&D or kind of platform investment initiatives as you work through some of this transition as well?

Yes, there's no question. I mean, one of the sort of secret weapons of our company is that services business, from the perspective of being shoulder-to-shoulder with our customers, you know, understanding what market trends look like, understanding what their specific needs look like, and informing, you know, our product roadmap as we, you know, as we go forward. Now, on a more near-term basis, also no doubt is where, blueprinting and designing, maybe it's a WMS or TMS, an auto management system, as it's being deployed, it's quite helpful to have the full portfolio available to us. So we can guide and maybe help our customers understand the benefits of a fully unified product portfolio.

Got it. Okay, that makes a ton of sense. And maybe kind of sticking with that theme from a kind of an adjacency perspective, as you migrate more of these customers and consolidate kind of more of these systems around that idea of unified commerce. How should we think about the opportunity for data monetization or embedded analytics use cases and things of the like? I know there's, kind of, some embedded benchmarking today, but maybe connecting data and workflows, what unlocking automation can mean for monetization given these systems that have historically been so disparate? It seems like it's kind of an incremental unlock opportunity?

Yes, for sure. I mean, obviously we've got a lot of analytical power in our system. We've got a lot of very valuable data and we've got a lot of analytical power and tools that we provide to our customers as you point out embedded in our solutions. And cross-sell and up-sell for us is certainly the name of the game. We're pretty clear about that. You know, when we sell solutions to our customers, we're very open with them. Hey, we would like the opportunity as the need comes up to help you with all of your supply chain needs, kind of end-to-end. And the unified platform that we have certainly helps enable that. We believe the bridges to get from one of our solutions to another is much shorter given the technology underpinnings that we have, the zero data replication in terms of transactional data replication that's required. It makes it smooth, it makes it seamless, faster, and of course, a lower total cost of ownership.

Great, thank you for that. Appreciate it.

Sure thing, Dylan.

Thank you. Our last question will be coming from the line of Blair Abernethy with Rosenblatt Securities. Please proceed with your questions.

Thanks, and thanks for taking my question. Just following on the last line of thought there, Eddie, on the migration to the cloud as you get the whole more and more of your customers' data flows, workflows and data flows related to those in the cloud? Are there other opportunities there for you to partner with other outside parties to help the customer leverage their data more?

Sure, yes, always. Obviously, our I’d say our principle data partner and technology partner is Google, who I think everybody knows is pretty powerful when it comes to a combination of analytics, data leverage, generative AI, business analytics, of course, BigQuery, and so on and so forth. And they've done some really clever work in enabling their customers and our joint customers to be able to monetize the data that's inside of that system. And we get the benefit from that as well, as we put together at cross-sell and upsell opportunities and roadmaps with our customers and prospects.

Great, thank you. And just Dennis, one quick one for you. I missed the early part of the call, but I'm not sure if you talked about the hiring environment at all, sort of, how your retention rates are going and your hiring plans for 2024?

Yes, I did mention it. We welcomed about 100, almost exactly 100 new associates to the family in Q1 and on track with our hiring plans for 2024. Attrition is fortunately running at a very low rate for us, so we're able to keep hold of our great talent and they continue to gain more and more experience, which is really helpful for us, for our customers, and everybody concerned. But hiring plans on track for several 100 hires this year.

Great. Perfect. Thanks very much.

My pleasure, Blair. Thank you.

Thank you. At this time, we've come to the end of our question-and-answer session. And I'll turn the floor back to management for closing remarks.

Okay. Very good. Well, thank you, Rob, and thanks everybody for joining us. We really appreciate your time. As you mentioned, we're excited about the start to the year and looking forward to more of the same and reporting out to you the results in about 90-days or so. So thanks again.