Appian Corp. Q4 FY2024 earnings call

• Matt Calkins discussed how Appian brings AI to work within processes, highlighting six ways AI is better in Appian processes: easy instantiation of AI, process gives AI structure with human coordination, provides data, gives agents what they need to succeed, visibility, and makes AI scalable. He also mentioned examples of customers using Appian's AI in processes, upselling to existing customers, and focus on basics like market identity, financial goals, etc.
• Mark Lynch reviewed financial highlights including cloud subscription revenue, total revenue, profitability metrics (non-GAAP gross margin 80% in Q4), balance sheet details, and recapped full year 2024 results.

In the fourth quarter of 2024, Appian Corporation's cloud subscription revenue grew 19% to $98.9 million. Subscriptions revenue grew by 18% to $136.8 million. Total revenue grew 15% to $166.7 million. For the full year 2024, cloud subscription revenue grew 21% to $368 million, subscriptions revenue grew 19% to $490.6 million, and total revenue grew 13% to $617 million. Subscriptions revenue represented 82% of total revenue in Q4 2024.

• First quarter 2025: Cloud subscription revenue expected $97 million (12-14% growth year-over-year), total revenue $162-164 million (8-9% growth year-over-year), adjusted EBITDA $8-10 million.
• Full year 2025: Cloud subscription revenue expected $419-421 million (14% growth year-over-year), revenue $680-684 million (10% growth year-over-year), adjusted EBITDA $38-42 million. Guidance also includes expectations of professional services being flat or low single-digit growth, on-prem license growth, Q2 adjusted EBITDA loss due to seasonality and conference costs, and removal of foreign exchange gains/losses from non-GAAP EPS calculation.

Q: Sanjit Singh asked about Appian's positioning in an uncertain US federal budget environment.

A: Matt Calkins said they are cautious, and Mark Lynch noted the 65% cloud, 35% on-prem in Q4 was an anomaly, expecting 80% cloud, 20% on-prem next year.

Q: Steve Enders asked about product roadmap and go-to-market innovation.

A: Matt Calkins talked about being practical with AI, focusing on fundamentals in go-to-market, and tweaking incentives for larger deals.

Q: Derek Wood asked about data sources and vertical traction.

A: Matt Calkins discussed universal data access and Mark Lynch said performance and pipeline were equally distributed among top verticals (financial services, public sector, insurance, life sciences).

Q: Raimo Lenschow asked about AI pricing and NRR.

A: Matt Calkins said agents are priced by usage with subsidization, and Mark Lynch noted NRR is within the 110-120 range with a 99% gross renewal rate.

Q: Nick Altman asked about tiered pricing and go-to-market incentives.

A: Matt Calkins discussed bringing existing customers onto new pricing with feature needs and tweaking incentives for larger transactions.

Q: Devin Ah asked about GAM suite adoption.

A: Matt Calkins said they had a strong pipeline in GAM and see potential due to federal efficiency focus.