Tarek Robbiati: Look, I think — so far, I would like to say that it’s early days for me, but I’m pretty pleased with the progress we are making and the way we are executing so far, 9 months into the fiscal year. We are focused on finishing fiscal year ’23 strong. And we have a whole quarter Q4 where we just started, and we have to continue to execute on it. We feel pretty good about that. And we will, in doing so, focus on my five priorities, which is to continue to innovate and build a multiproduct business. This is top left, right and center, where Vlad is spending all his energy, boosting our multiproduct portfolio offerings. This is really, really critical to fuel growth in both new customers and upselling to existing customers.
We are also focused on driving deeper penetration into certain key verticals and customer segments. We are building partnerships. We are growing internationally. And yes, I have to keep an eye on productivity moving forward. So it’s early days. I like the way you put forward the growth. We feel that demand for UCaaS and CCaaS attach are — is real. If you take integrated UCaaS, CCaaS as a whole, as a subset of the market, this is where we are playing, and this is the fastest growing portion of the market. There are some competitive displacements, particularly when you look at subscale vendors losing share. There is a likely competitive intensity with Microsoft Teams. We are exploiting that competitive intensity with our Teams 2.0 plug-in, which we just rolled out and that is gaining quite some traction.
And we will continue also to target enterprise customers with this best-in-class integration. So there’s a lot to unpack here, but I would say we are focused now on the very short term, which is to finish Q4 strong, and that is where all our energy is being focused on.
Operator: Thank you. The next question is from Matt VanVliet with BTIG. Please go ahead.
Matt VanVliet: Hi, good afternoon. Thanks for taking the question. I wanted to dig in a little bit more on the plans for international growth. How do you feel about your current headcount in a number of those markets? Do you need to build out more of a team from both either the direct or the channel enablement side? And then secondarily, with the stable partners you already have in place, do you feel like you can reach the goals you have? Or do you need to broaden that distribution network as well?
Tarek Robbiati: So look, having run international businesses for a large chunk of my career, I think the way you decide to go in a particular new market is really a function of the economic fabric of that market and particularly true for softwares and services businesses like ours. When you really look at, for example, in Europe, the weight of small and medium enterprises, which are our sweet spot. In Germany, it’s about 87% of the GDP. In France, Italy and Spain, it’s north of 90% of the GDP. And therefore, if you think about how do you go and acquire these customers in these geographies, you really have to think what is the best method, the most effective method to ramp up your access with the various routes to market to these customer segments.
And I’d say that there is an opportunity there by going through partnerships, in particular, and we don’t need to really build an extensive large direct sales force to capture share internationally. I think philosophically also, I’m not in favor of the approach that is about build and they will come. We need to be very pragmatic here and leverage existing partners in the market because there is, in our view, a large opportunity for us to become the first global cloud provider with our offerings, whether these are MVPs or the new offerings that we are right now developing with Vlad and the team.
Matt VanVliet: Great. Thank you.
Operator: The next question is from Terry Tillman with Truist. Please go ahead.
Robert Dee: Great. Thanks for taking the questions. This is Bobby Dee on for Terry. Just one quick one for Tarek. Since being in the CEO slot, what do you think is most misunderstood about the story at this point? Thank you.
Tarek Robbiati: What is the least understanding point about RingCentral? I think I would say to you, look, not every UCaaS is created equal. And the strength of the foundation that we have built is that to stay. And the numbers do the talking. I mean just look at the ARPUs, you had Sonalee commenting on our ARPUs and where they stand, look at the number of seats. We have more than 400,000 customers worldwide. We are growing faster than the rest of the UCaaS market. And even when you have, I would say, periods of economic uncertainty, there is a flight for quality in these circumstances. And we are seeing that, and we feel good about our position. Now of course, Vlad and I are not happy with just that. We want to continue to dial up growth and expand our portfolio.
And expanding our portfolio over a quality foundation is a lot easier, believe me, than to worry about the core. There is a lot that is going to be unlocked over the next few days. We have telegraphed a — if I take this opportunity, we have telegraphed a marketing event on November 14 to show that we are going to be expanding our core products of RingCX and Ring Events to become available generally or general availability. And as you can see that our goal here is to build on the foundation that we have to emerge out of this period of economic uncertainty with strength, and this is why we are making all the investments we are making in innovation.
Operator: The next question is from Will Power with Baird. Please go ahead.
Will Power: Great. Thank you. Tarek, I was curious in some of the comments on focusing on SMB, I know that’s a heritage area for you all. Also, I think, often viewed as a more competitive area. So maybe just a little more color on the rationale for kind of refocusing in some respects or focusing that much more on SMB? And where are the kind of the key investment opportunities? Are there any kind of areas of low-hanging fruit as you kind of evaluate that?
Tarek Robbiati: So look, SMB has always been our sweet spot, and it’s not that we are refocusing on SMB for the first time. Our SMB business is over $850 million. It is still growing at about 8%, which is much more than many of our competitors are growing overall. We have the leading UCaaS offering that is differentiated that is reliable with 99.99% availability. We are rolling now out the RingCX and RingSense for sales. And we are seeing great traction, particularly for this segment of the market because for small and medium businesses, our new offerings are really around adding value to the businesses in question and making them more competitive over time. And we feel there is a lot more to do and are confident about our position in that segment of the market.
Will Power: Thank you.
Operator: The next question is from Ryan Koontz with Needham & Company. Please go ahead.
