Hello and welcome to Alkami’s First Quarter 2022 Financial Results Conference Call. My name is Danielle and I will be your operator for today’s call. [Operator instructions]. I would now like to turn the call over to Steve Calk, Steve, you may begin.

Thank you, Danielle. With me today on the call are Alex Shootman, chief executive officer, and Bryan Hill, chief financial officer. During today’s call, we may make forward-looking statements about guidance and other matters regarding our future performance. These statements are based on management’s current views and expectations and are subject to various risks and uncertainties. Our actual results may be materially different. For a summary of risk factors associated with our forward-looking statements, please refer to today’s press release and the sections in our latest Form 10-K and 10-Q entitled Risk Factors and forward-looking Statements. Statements made during the call are being made as of today, and we undertake no obligation to update or revise any forward-looking statements. Also, unless otherwise stated, financial measures discussed on this call will be on a non-GAAP basis. We believe these measures are useful to investors in the understanding of our financial results. A reconciliation of comparable GAAP financial measures can be found in our earnings press release and in our quarterly filings with the SEC. I’ll now turn the call over to Alex.

Thank you, Steve, and thank you all for joining us today for our first quarter 2022 earnings call. I’m pleased to report that Alkami delivered another quarter of strong performance. Bryan will provide details in a few minutes, but I’d like to share some highlights. In the first quarter, we grew 35% which was ahead of our expectations. We exited the quarter with 12.8 million live registered users on the Alkami platform, which is up 2.8 million users year over year. In terms of sales, first quarter was solid. We have five new logos and four renewals of existing clients and our sales pipeline growth exceeded our expectations. In addition, we have 40 new logos and considerable add-on sales and implementation already all totaling $37 million in ARR. I continue to be impressed with our team, the outcoming product portfolio and the market opportunity we have in front of us. And thank you to all welcoming us for your passion and execution. We started off the year very well. Last week, we held our annual user conference in Texas with 325 client prospect attendees representing 149 financial institutions. This is the largest in-person event in our history and through many hours of clients, prospects and partners, I heard a consistent gain for mandatory innovation. The industry knows that it has a significant opportunity to transform and become the kind of service that customers demand in a digital age. Our clients understand that a good digital experience attracts and retains customers. In fact, in a steady response around generation of purposes of banking conducted specifically for this conference, 80% of Americans say the quality of their digital banking experience is essential to a new firm becoming their primary financial provider and 46% of Gen Z at 50% of millennials provides such…

Thanks, Alex, and good afternoon, everyone. In the first quarter, we continued to execute and deliver strong financial results. Let’s begin with revenue. In Q1, we achieved revenue of $44.8 million, which outperformed the high end of our financial guidance by $800,000 and represented growth of 35% compared to the prior year. This was driven by continued strong performance across all our primary revenue drivers. We implemented three new logos in the quarter, bringing our digital platform client count to 179 compared to 156 in the prior year. As a reminder, we expected the first quarter of 2022 to be the lowest in terms of new implementations, which is consistent with 2021 and we expect the cadence for the remainder of the year to be in line with our 2021 as well. For example, we now have 40 new logos representing 1.6 million digital users in the process of implementation. During the remainder of 2022, we expect to implement financial institutions from our backlog representing 1.4 million digital users. We exited the quarter with 12.8 million registered users live on the platform, up 2.8 million or 28% compared to last year and up 464,000 sequentially. Over the last 12 months, digital user growth continues to be driven by two areas. First, we’ve implemented financial institutions supporting 1.3 million digital users. And second, our clients have increased their digital user adoption by 1.5 million users, representing 15% growth. We continue to drive RPU through add-on sales and hire new client RPU, growing revenue per user to $13.80, up 3% compared to the prior year quarter. This compares to our blended market opportunity of approximately $54 per user, excluding the Segmint, market opportunity, which I will address momentarily. Subscription revenue grew 36% compared to the prior year quarter and represented 96% of…

[Operator instructions]. First question comes from Mayank Tandon of Needham. Please go ahead.

Hey, good afternoon. This is Sam Salvas on for Mayank today. Congrats on the results. I was wondering if you guys could talk a little bit more about the Segmint acquisition and your expectations as far as cross-selling the Segmint offering with the core Alkami platform.

Hi, this is Alex. Thanks for the question. We’re excited about two things. Number one, this is a very attractive product as a stand-alone sale, right? So the company has built themselves into an attractive company with, as I said earlier, well over 100 customers selling Segmint directly to financial institutions, and we would -- we’ll continue that motion and expect success with that motion. We’re also very excited about cross-selling to the Alkami base. Our customers have always wanted -- we’ve had products in this space, but our customers have always wanted to use data to improve the way that they personalize their marketing offers and targeting and then also be able to deliver offers back into the mobile product, if you think about it as a channel. So you would take data from Segmint and allow our customer to better target one of better target a customer and develop an offer and make that offer, but then also distribute that offer into the mobile the Alkami mobile product as a channel. To give you an example, we had -- we closed the acquisition right before we started our customer conference. And so the Segmint folks were at our customer conference and obviously our customers were there. The breakout sessions for the Segmint topics were standing room only. And there was a lot of enthusiasm from our customer base. So in summary, we’ve got a great opportunity to sell this product and technology stand-alone without the Alkami product. And we also see a lot of value that’s created for our customers in selling Segmint back into our customer base.

Got it. That’s very helpful. And then just a quick follow up. I was wondering if you guys could talk a little bit more about some of the new business wins and renewals from the quarter. And what the mix was there between like banks and credit unions?

Yes, that’s great. In Q1, we had a very successful quarter in new sales in a couple of different areas. Primarily, when you compare to prior year either in a quarter or a trailing 12 month basis, Q1 resulted in a significant start for the year, which we’re super excited about. But it was heavily dominated for banks, which is exciting for us. Out of the five new logos that we had four those were banks. On average, the financial institutions that is just over $2 billion of assets across all five. And they took about 15 products resulting in an RPU of $25 and that compares to our $13.80 company average. So we’re continuing to see each quarter, each year -- our sales force is getting very good at selling more product as we expand the platform in that initial order. What’s equally as exciting during the quarter is our client sales team. Client sales team represented over 40% of our business and total TCV that we added during the quarter. That’s a step up from the last year. It’s a step up from Q4, now it was a lower new logo quarter for us. So you would expect client sales to represent more of the sales during the quarter but on a year-over-year basis, client sales was up significantly. So again, great momentum coming out of that team. The four renewals that we had represented close to $2 million of ARR collectively across those renewals. And we were successful increasing the run rate from that business 7% fairly evenly split between price increase on existing product and adding new product and ARPU as a part of the renewal. In 2022, we expect to renew close to $20 million of ARR which up to this point in our life cycle we only renewed across all years $20 million in ARR. So a very exciting renewal year for us and we hope to perform at the same level that we had in the past.

Awesome. That’s super helpful. Great to hear. Thanks for taking the questions again and congrats on the results.

Thank you.

There are no remaining questions. Thank you for attending Alkami’s first quarter 2022 conference call. You may now disconnect.