Ooma, Inc. (NYSE:OOMA) Q2 2024 Earnings Call Transcript

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But all that said, couple hours, three hours, we’ll get an installation at a site done. If that installation needs two AirDials and six lines, it goes pretty fast per location. So, it’s really the number of locations that drives the timeline and the effort, just the project planning and the pre-installation analysis you need to do to know how you’re going to make the conversion happen.

Brian Kinstlinger: Got it. Last question for me is on the international front, you’ve obviously used your largest customer to expand internationally. At what point does the company make the investment necessary to begin selling to other customers outside this large customer? Is that in the next 12 and 24 months? Is there too much on your plate to think about that right now?

Eric Stang: Well, it’s not in our plan for this fiscal year, which is the next six months, but I think it’s fair to say that we aspire to it being in the timeframe you mentioned or something like that. We’re also going to have to question what we lead first with internationally, I — we see tremendous AirDial opportunity internationally as well. But, most likely, if we’re going to dovetail off what we’ve done with this large customer, we would begin selling our Ooma Office solution in particular probably in Western European countries and to third-parties, to other parties. We would love to do that with certain partners or certain, entrées into the market, and we are thinking about our strategy in that regard. But this year, we don’t — we are not working on those next steps yet.

Brian Kinstlinger: Great. Thanks for taking my question.

Eric Stang: You bet.

Operator: [Operator Instructions] Your next question comes from the line of Matthew Harrigan with Benchmark. Your line is open.

Matthew Harrigan: Thank you. Congratulations on the results and the guidance. I just had a couple dangling things. One, I guess in the nature of course, the vacuum category, you’ve got a huge TAM for AirDial and clearly, there’s a crying need right now. Are you seeing anything in the way of incipient competition or people you see who are at least desirously coming in the space? And then anecdotally in the US, I mean, despite their AT&T working hard to phase out copper lines and all that, you’re seeing something that’s almost price-gouging in terms of what they’re charging as the current alternative Are you seeing the same type of this pricing when you look at Europe and other markets in terms of the copper lines just being way out of whack and that’s increasing the urgency of people wanting to move on? Thank you.

Eric Stang: Yes. So, on your second part of your question, it varies a little bit. We don’t see it so much in Canada. I believe in Canada, pricing is still relatively controlled, although, we are seeing Canadian customers in need of AirDial and asking for it and currently we’re not, providing AirDial in Canada. So, even though the market, I don’t think is as far along as it here in the US, certainly going that way, but it’s not there yet. When we look at Europe, it varies a little bit by country, in fact, it varies a lot by country. Some countries haven’t started their journey, but they know they need to. And they’re in the very early days of looking for what they might do. Others, are kind of getting started and its — and now looking at, what’s the best approach to take.

And I feel like whenever we can get in front of a partner in one of these countries, because keep in mind, we need a cellular provider to at least provide the internet connection that goes with AirDial. We find that once we explain what AirDial does and how it works, there’s no product like it in the market. And — so, it’s a really compelling story and I really believe that. And it’s just getting better every day too. We’ve made so many improvements to it even over the last six months and extensions to it. So, we’re actively thinking that at that level, more broadly than the US, but, I don’t think there’s — I don’t think that the other markets have turned the corner like the US has over the last 12 months. Over the last 12 months — really over the last six months, even since the start of this year, we’ve seen customers a lot more aware of the need to do something.

I think word starts to get out and they’re — they start to notice their bills. And so the US is clearly farther along than other countries. But, I see — you can definitely see it coming. I hope that addresses your question. I don’t know if there’s a first part of your question, I didn’t get to or not.

Matthew Harrigan: Yes, the first part of the question was really incipient competition, I know there’s a long sales cycle. It takes a while to get product out and all that. But there’s a crying need that’s a massive market opportunity. Do you see anyone at all who’s at least working on a comparable solution incipiently, because it doesn’t feel like you would necessarily have four or five years to address this massive market before someone else or other people aggressively came in?

Eric Stang: I don’t know of anyone that’s working on a new solution for this market or any development underway to change the solutions that are out there today. I think the biggest challenge we face is making sure customers know we have AirDial and know what it can do for them. And we need a lot more outreach and branding and marketing to do that. But if you’re a large aggregator today, you have a lot of pot signs that you sold and you know where they are and you can just walk into those customers, we need to get them to realize there’s a viable alternative. We have a significant opportunity we’re working right now where they got introduced to us through a third-party and they were just thrilled to find out about us, but they had no idea.

They just didn’t know. And it’s kind of customer we should we should be reaching out to. And so we’re really trying to build our sales and marketing capability, to be able to do more of that and that’s, I think, what will drive the business.

Matthew Harrigan: Great. Nice problem [ph] to have. Thanks Eric.

Eric Stang: Thank you.

Operator: There are no further questions at this time and concludes our Q&A session. I turn the call back to Eric for closing remarks.

Eric Stang: Well, thank you, everyone. We were excited to outperform on the revenue and frankly, our $3.6 million in cash flow from operations is I think the most we’ve ever had as a company and we’re doing it while we’re investing in these new strategic initiatives. I feel like we’re on track and I realize from all the questions here and just in general talking with all of you, we as well want to be able to show you even more AirDial success and I want you to know we’re working hard towards that. With that, thank you everyone. We’ll stop here. Thank you.

Operator: This concludes today’s conference call. You may now disconnect.

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