8x8 (EGHT) BofA Securities 2024 Global Technology Conference summary

Macro environment and business impact

• Higher interest rates have pressured small and medium businesses, slowing the economy and increasing downsell pressure, mainly through seat reductions rather than logo losses.

• Pandemic-driven overprovisioning is being right-sized as contracts renew, with a lag between layoffs and seat reductions.

• Sales cycles are lengthening, and deal sizes are shrinking, but logo retention remains strong.

Revenue growth outlook and metrics

• Confidence in second-half revenue growth is based on detailed internal modeling, sales pipeline analysis, and new product traction.

• New products, especially Intelligent Customer Assistant, are showing increasing usage and customer adoption, with expected inflection in revenue growth by Q3/Q4 2025.

• Remaining performance obligations (RPO) are steady at around $790 million, indicating a solid backlog.

• Usage-based revenue is rising, now at 12% and expected to grow, which may reduce future revenue visibility.

Industry trends and product strategy

• The industry is shifting toward consumption-based pricing, affecting financial statement visibility and requiring new metrics for investors.

• The company’s strategy focuses on workflow improvement and best-in-breed AI partnerships rather than building proprietary AI, differentiating from competitors.

• The go-to-market approach is shifting from selling products to selling business outcomes, emphasizing solutions like remote fix and customer retention.