IDT Corporation (NYSE:IDT) Q1 2024 Earnings Call Transcript

The reason we want to do it is really about the functionality, the improved experience that the customers are going to get not about the $1 to $2 per user that it costs us to, I’ll say, have a rented platform for some of our older customers. I think you asked one more question, I might’ve forgot.

Unidentified Analyst: Yes, about the contract length. Let me clarify an item there. So what I meant by backlog is, the contracts that you already have signed with your customers and are yet to be paid. So those that will be paid in the future. That’s where the backlog that has to be collected.

Shmuel Jonas: So I don’t know the answer to that question. I mean, most of our customers are billed monthly. We do have some annual contracts, but the vast majority of our customers pay on a monthly basis, so there’s not a huge backlog in terms of payment. As far as the length of the contracts, most contracts tend to be three years, but we have as little as one year depending on the country and the specific users.

Marcelo Fischer: Shmuel is correct. We have — in terms of how you define backlog, the overwhelming majority of our customers are on a monthly payment basis. So we usually they have one month of default revenue on the balance sheet, no more than that. And that we built a real backlog, the reality is that we have been adding roughly about 12,000 to 13,000 seats quarterly for the last several quarters. We believe that that trend is likely what we are targeting on in terms of kind of achieve going forward as well. With Apple improvements as we launch new higher Apple products and also as we — as CCaaS customers become gradually larger portion of the total portfolio because CCaaS ARPU is about 7 times to 8 times larger than the ARPU of a regular customer.

Unidentified Analyst: Okay, good. And I think I haven’t asked about M&A. Last quarter you referenced a small acquisition on the NRS side. I haven’t seen any outflows of money dedicated to acquisitions. So if you can provide any updates, that would be greatly appreciated?

Marcelo Fischer: It’s very small. It’s not material.

Unidentified Analyst: Okay. Thank you.

Operator: [Operator Instructions] Okay, we have no further questions in queue. As there are no more questions, this concludes our question-and-answer session and conference call. Thank you for attending today’s presentation you may now disconnect.