Olo (OLO) KeyBanc Capital Markets Technology Leadership Forum summary

Business performance and financial highlights

• Reported a strong quarter, exceeding both top-line and bottom-line expectations, and raised full-year guidance, with key metrics like location count, ARPU, and gross profit growth all surpassing forecasts.

• Net revenue retention (NRR) has exceeded 120 for two consecutive quarters, driven by multi-module adoption and sustained digital ordering growth.

• Olo Pay revenue target for the year was raised from $60 million to mid-$60 million, reflecting 100% year-over-year growth and outperformance in the first half.

• Gross margins have decreased as Olo Pay scales, but this is intentional to drive faster gross profit and operating profit growth.

• Implementation timelines have improved, with complex brands able to launch in under 90 days; Dutch Bros plans to roll out 850 locations in the back half of the year.

Product strategy and market positioning

• Focuses on guest-facing technology for restaurants, including digital ordering, kiosks, payment processing, and guest engagement, integrating with staff-facing POS systems.

• Competes mainly in the enterprise segment (brands with 5+ locations), often displacing homegrown technology by emphasizing lower total cost of ownership and faster time to value.

• Sales teams are segmented by customer size, with digital ordering as the typical entry point, followed by payment processing and guest engagement solutions.

• Recent wins like Dutch Bros and Quiznos highlight demand for digital solutions, especially in drive-thru operations, and showcase the potential for efficiency and guest relationship improvements.

• Catering is a growing product area, serving as both a revenue driver and a strategic entry point into top 25 brand conversations.

Industry trends and growth opportunities

• Digital transactions now represent 18% of total industry transactions, higher than during COVID, indicating strong and sticky consumer adoption.

• Brands are increasingly seeking technology to drive profitable traffic and efficiency, especially in a challenging macro environment.

• Olo's customer base is two-thirds limited service (QSR/fast casual), providing some insulation from economic downturns as consumers trade down.

• Kiosks and digital ordering are seeing increased demand as brands look to do more with less.

• The card-present payment opportunity is significant, with $26 billion in digital GMV and six times more GMV occurring on-premise, which Olo aims to address through POS integrations.