Good day, and thank you for standing by. Welcome to the Bridgeline Digital Inc. Third Quarter 2022 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Tom Windhausen, Chief Financial Officer. Please go ahead.

Thank you, and good afternoon, everyone. Thank you for joining us today. My name is Thomas Windhausen, and I'm Bridgeline's Chief Financial Officer. I am pleased to welcome you to our Fiscal 2022 Third Quarter Conference call. On the call this afternoon is Ari Kahn, Bridgeline's President and CEO, who will begin with a discussion of our business highlights. I will then update you on our financial results for the quarter, and we will conclude by taking questions. Before we begin, I'd like to remind listeners that during this conference call, comments that we make regarding Bridgeline they are not historical facts, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934. And are subject to risks and uncertainties that could cause such statements to differ materially from actual future events or results. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The internal projections and beliefs upon which we base our expectations today may change over time, and we expressly disclaim and assume no obligation to inform you if they do. Results that we report today should not be considered as an indication of future performance. Changes in economic, business, competitive, technological, regulatory and other factors, such as the impact of public health measures could cause Bridgeline's actual results to differ materially from those expressed or implied by the projections or forward-looking statements made today. For more detailed information about these factors and other risks that may impact our business, please review the reports and documents filed from time to time by Bridgeline Digital with the Securities and Exchange Commission. Also, please note that on the call this afternoon, we will discuss some non-GAAP financial measures when commenting on the company's financial performance. We provide a reconciliation of our GAAP financials to these non-GAAP measures in our earnings release. You can obtain a copy of the earnings release by visiting our website. I will now turn the call over to Ari Kahn, our President and CEO. Ari?

Thank you, Tom, and good afternoon, everyone. Bridgeline had 22% revenue growth this quarter compared to the same quarter last year, totaling $4.2 million. Most of our growth was in subscription and license, which increased by 29% to $3.4 million. Subscription license is now over 80% of our total revenue and drove gross profit to increase by 30% to $2.9 million, with a 5 point gain in gross margin percentage. We booked $690,000 in new license ARR from 23 sales this quarter. Our cross-sell strategy drove 11 license sales to existing customers on top of 12 newly won customers. And site search is our strongest growth area with 19% CAGR organic growth. Our cash and projected operations position us well to continue our investments in innovation and sales and marketing without capital -- additional capital for operations. We ended the quarter with $3.9 million in cash after paying $0.5 million in financing activities from the WooRank and HawkSearch acquisitions. We also negotiated a $600,000 discount to the earnout and working capital adjustment on the HawkSearch acquisition in consideration for a 6-month early payment. Our eCommerce360 strategy fuels more efficient growth, not only by winning new customers with multiple entry points to our product suite, but sales of new products to existing customers from our growing product suite. Bridgeline saw growth in the finance, automotive, retail and manufacturing industry. Belmetrics who is an auto parts dealer who chose our HawkSearch product to power their big commerce online store. This is the latest in a series of new automotive customers, including 1-800-Radiators and [indiscernible]. Procon Pumps, our B2B pump manufacturer, selected HawkSearch to power search, recommendations and search information management on their online store. Our AI-powered search information management project, increasing B2B sales for companies with products that require unit measurement conversion.…

Thanks, Ari. I'm thrilled to share with you all this afternoon our positive financial results for the third quarter of fiscal '22, which ended June 30, 2022. Total revenue for the quarter ended June 30, 2022, was $4.2 million, an increase of 22% as compared to $3.4 million in the prior year period. Now going into each component. Subscription and license revenue increased 29% for the quarter ended June 30, 2022, to $3.4 million from $2.6 million in the prior year period. As a percentage of total revenue, subscription and licenses revenue increased to 81% of total revenue for the quarter ended June 30, 2022, as compared to 76% in the prior year period. Subscription and license revenue is comprised of SaaS licenses, maintenance and hosting revenue and perpetual license revenue. This increase in subscription license revenue as a percentage of total revenue was driven by the prior year acquisitions of [VuLink] and HawkSearch, which have a high percentage of subscription revenue. Services revenue was $0.8 million for the quarter ended June 30, 2022, as compared to the same $0.8 million in the prior year period. As a percentage of total revenue, services revenue accounted for 19% of total revenue for the quarter ended June 30, 2022. Cost of revenue increased 7% or $0.1 million to $1.3 million for the quarter ended June 30, 2022, compared to $1.2 million in the prior year period. As a result, gross profit increased 30% or $0.7 million to $2.9 million for the quarter ended June as compared to $2.3 million in the prior year period. Our overall gross profit margin increased to 70% for the quarter ended June 30, 2022, compared to 65% in the prior year period. Our subscription license gross margins were 75% for June 2022 as compared to 72% in…

[Operator Instructions] Our first question comes from Howard Halpern with Taglich Brothers.

Congratulations.

Thank you, Howard.

Okay. Excited to -- TruPresence got a nice customer win. What kind of deployment time line are we looking for with that new customer?

This is great. So a big focus for us internally here is to reduce deployment time and the cost of initial implementation. And for this new customer who was TruPresence, they're able to use the product right out of the box with 0 services. It's a 100% pure software sale.

Okay. And I guess with that customer win, do you have a little bit of a pipeline developing for other potential customer wins for that product?

We do. We do. And specifically, in the TruPresence brand, all of our products adjust with tuning specifically for the franchise industry. And DataBravo was the products -- the underlying product that was sold with TruPresence. What DataBravo allows you to do, and we've got a great pipeline for this is that when you are a franchise and you have perhaps several thousand franchisees, each with their own website. Look, the challenge that you'll have is that one of those franchisees neglect their website, and it has core search engine optimization. That weakness will bubble up throughout the rest of your site and pull down all of their rankings. With DataBravo, you can evaluate your entire network, our franchisee websites, identify any weaknesses and receive recommendations of exactly how to address those weaknesses to fix that site. And this is a need that's in very high demand. We've got a great pipeline of franchisees and nobody else is doing this.

Okay. And overall, how are customer acquisition costs trending for you?

So our CAC is improving every day, and it's in the 2.9 range of lifetime value to CAC right now. We think that's going to get even better. And part of the improvement is that we have now a broader product suite where our own existing customers have opportunities to buy additional products from us. And we're going to keep expanding that suite. DataBravo, for example, is a launch that we did last year using some of the technology that we acquired with WooRank. And that will further reduce CAC going forward.

And talking about WooRank, are you still seeing -- compared to maybe a couple of quarters back, are you still seeing the same kind of traffic rent that generate customer leads?

It is consistent with what it's been for the past couple of quarters. And we're expanding our strategy with WooRank where we are creating partnerships with platforms. And we'll be releasing Shopify specifically this quarter to further distribute WooRank and then all of those WooRank customers will then have a conversation with to introduce our other products as well through our dashboard.

Okay. And I guess one last one. I mean, you talked about in the press release to defer partnership. What is that going to mean for you 1 year or 2 or 3 down the road?

Well, as we announced that our new customer have a [indiscernible]. And it very much changes the structure of our own sales team. We have every single direct salesperson now owns one or more partnership relationships and manages that. So the way that we manage and structure our own sales team is different. Our CAC goes down because now we're coming in with a partner and have lower marketing costs and greater credibility out of the gate. So we expect this to be transformative for our product sales process and in fact, it already is.

At this time, I am not showing any questions. I would now like to turn the conference back to management for closing remarks.

Thank you for joining us today. We appreciate the continued support of all of our customers, partners and shareholders, and we're excited about our business and ongoing growth prospects. We look forward to speaking with you again on our year-end fiscal '22 conference call in December. Thank you, and stay healthy.

This concludes today's conference call. Thank you for participating. You may now disconnect.