PROS Holdings Inc (PRO) Q2 2010 Earnings Call August 5, 2010 4:30 pm ET Executives Bert Winemiller - Chairman and CEO Charlie Murphy - EVP and CFO Analysts Tom Roderick - Stifel Nicolaus Dave Hafner - JP Morgan Ian Kell - Northland Capital Market Harish Parwani - Jefferies & Co. Nabil Elsheshai - Pacific Crest Securities Operator
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Also these statements are based solely on the present information and are subject to risks and uncertainties that could cause actual results to differ materially from those projected in the forward-looking statements. Please refer to our Form 10-Q, Form 10-K and other filings with the SEC and the risk factors contained therein. Also, please note that a replay of today's webcast will be available in the Investor Relations section of our website at www.prospricing.com.I would also like to point out that the company's use of non-GAAP financial measures is explained in today's earnings press release, and a full reconciliation, between each non-GAAP measure, in the most directly comparable GAAP measure is provided with tables and company in the press release, distributed early today. It can also be found on our web site, in the investor relation section, with that I would like to turn the call over to Bert. Bert Winemiller Thank you, Charlie, and thanks to those of you listening to our call, we continued to make great progress on our strategic initiatives that will position us to capitalize on the large long-term market opportunities, for our high ROI enterprise pricing and margin optimization software product. We are pleased with our financial performance in the second quarter of 2010, and especially with the number of new transactions we completed across a wide range of vertical markets, and continued strong maintenance renewal rates. For the second quarter we are reporting revenue of $17.8 million, which exceeded the high end of our guidance and with our third quarter of sequential revenue growth. Non-GAAP operating income was $2 million for the second quarter, which achieved the high end of our guidance while continuing investments in our products, sales and marketing, and partner initiatives. PROS is a global company, with revenue diversified across geographies in our target industry sectors. Revenues obtained from outside the U.S. represented 58% of the second quarter 2010 revenue, and 57%, of second quarter license and implementation revenue came from our target industry sectors of manufacturing, distribution and services.
During the second quarter, we continued to invest in R&D and to expand our pricing, partners, ecosystem, including signing another formal global alliance agreement with a systems integrator.We also delivered a release of our Pricing Solutions Suite with new science innovation, new user experience enhancement, new pricing features, enhanced industry solutions and significant performance in scalability improvement. PROS continuous to be focused on delivering industry leading pricing and margin optimization software solution with fast time-to-value and high ROI for our customers. Our fast time-to-value program allows our customers to identify millions of dollars of pricing profit opportunities in the first 30 days. A recent example of this is that we were able to install Scientific Analytics in less than 30 days and Price Optimizer and Deal Optimizer in five months for a Fortune 400 chemical manufacturer. This project also was an excellent example of our work with our system integration partners who worked jointly with PROS to install our products. The high return on investment and fast time-to-value we provided for a leading office product distributor was recognized by a sister division in the service part business. That division recently signed a license agreement for our Scientific Analytics and Price Optimizer product. This customers win adds to our growing list of bluechip distributor in service parts companies and highlights our ability to cross sell into additional divisions of existing customers. PSS World Medical Inc. a national distributor of medical products selected PROS as their pricing excellence partner in the second quarter and selected PROS Pricing Solution Suite to enhance their customer relationship and help meet profitably and performance goals. PROS Scientific Analytics will assist PSS World Medical sales team in accurately tailoring product offerings and scientifically calculated price points to each customers unique buying needs. PROS Price Optimizer will deliver accurate and timely price list from multiple channel and PROS Deal Optimizer will equip their sales team with real-time pricing and product recommendations to satisfy customer demand. Read the rest of this transcript for free on seekingalpha.com