Appian Corporation (NASDAQ:APPN) Q2 2023 Earnings Call Transcript

Matt Calkins: Yeah. Data Fabric is going to help us make a specific form of AI argument. So let me clarify this before I address your question. Data Fabric allows you to gather information in dispersed locations across your enterprise and use it for a common purpose. It’s like a common semantic layer for addressing all that data as if maybe we’d put it all into the same database, except we didn’t we just came up with a common way of grouping it and addressing it even though it’s really scattered across the enterprise. Well, that’s super useful. If what you want to do is train or fine-tune an AI algorithm. If you bring in an AI model, you want to use it behind the firewall so that you keep the data. It’s always yours. You keep the algorithm.

It’s always yours. It’s a very private customer-centric, data-centric vision of how to use AI than Data Fabric is fantastic. Data Fabric will grab you that data set, allow you to customize, select the information you want to train your algorithm with bring it together neatly and serve it up to the AI algorithm, so you can train it. It’s very good for that kind of a vision. It’s also very good for that matter for our typical use, which is to inform the actions in a process. And remember that now AI is one of the primary actors process. And so the more data connectivity you have, the more you can inform, send the right questions to AI, be sure that they’re better informed to give you the answer. So Data Fabric is a key supporting player in an AI future.

As for how that’s playing out in terms of winning deals, closing deals, it’s going to be too early to say. So I can’t speak to that. But I have strong belief that we are facilitating a form of AI usage that’s going to appeal to large organizations in regulated industries with important data sets and mission-critical intentions.

Steve Enders: Okay. Perfect. Appreciate the answer there.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Sanjit Singh from Morgan Stanley.

Unidentified Analyst: Excellent. Thank you. This is on for Steve on for Sanjit. I just had maybe two quick questions on the go-to-market. The first one, last quarter, you spoke a lot about public sector strength. I would be curious to hear kind of where the strength was this quarter? And then maybe contrast that with where you also see the most excitement around AI that could materialize later on? And then the second one under the new partner program that you announced, anything that you can share in terms of what you’re seeing in terms of early momentum, or when — what we should think about in terms of timing of some of those new leads materializing. That would be very helpful.

Matt Calkins: Okay. Okay. Great. With regards to the industry that did the best this quarter, I’m going to a public sector again. It’s just a really strong sequence here in the US public sector specifically, which isn’t to say that that’s where there’s the most excitement around AI. The public sector is a cautious segment. And I don’t think it’s going to be the AI pioneer. I think we’re going to see AI pioneering in places like pharmaceutical, financial services. I think it’s going to make sense, insurance, healthcare. I’d actually put a public sector as a likely AI late adopter relatively. So we’re succeeding for other reasons in public sector. And then the other question was about partners. We are adopting a new methodology of working with partners I think it’s dynamic, it’s exciting.

It’s premature to cite anything, of course, totally because it’s not even rolled out. So I can’t say what it has done — but I believe that we’re on to something important, having learned what we have about how to motivate partners, I think that we’re going to take a powerful step in the right direction. And that’s all I can say about it, just a future expectation kind of a statement.

Unidentified Analyst: Great. Thank you.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Kevin Kumar from Goldman Sachs.