Pegasystems Inc. (NASDAQ:PEGA) Q3 2020 Earnings Conference Call - Final Transcript

Oct 28, 2020 • 05:00 pm ET

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Pegasystems Inc. (NASDAQ:PEGA) Q3 2020 Earnings Conference Call - Final Transcript

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Executive
Alan Trefler

than about halfway through the transition to recurring. And as we start to get closer to completing this transition, unsurprisingly, our cash flow should and will start to improve. We anticipate that both cash and revenue will start to be a better reflection of the health of the business, notwithstanding the lumpiness of any quarter.

Our team remains strong, resilient and committed to the success of our clients and Pega, and I remain deeply respectful of how they and our clients are engaging as we collectively navigate through this ongoing time of uncertainty. Now in terms of client trends, our sample is ideally suited for organizations that continue to face immediate challenges today, even as they know they need to transform for tomorrow. We are handling problems that, in many cases, no one else can solve, from visionary goals to quick fixes and everything in between.

Pega crushes business complexity in given this, well, complicated and ever-changing world. Our software is the engine that makes solutions clearer, relationships smoother and helps our clients delight their customers and bring siloed teams together. We continue to improve our software to make it easier for clients to enhance customer engagement, boost their employee satisfaction, all increasing while they increase efficiency and reduce costs. Now key industry analysts continue to see Pega improving.

And our Pega Infinity ratings is one of the important ways that we develop confidence that our significant R&D investments are successful. For example, since we last spoke, we are the undisputed overall leader in the just-published Forrester prestigious Real-Time Interaction Management Wave, ahead of 12 other players, including Salesforce and SAP. The reality is that this idea of having a brain to drive and control and optimize interactions really is resonating with organizations.

We released our last version of our unified Pega Infinity product suite, and I want to give a big thank you to everyone across the Pega organization, who put so much effort into planning, developing and delivering the tremendous features and working so closely with our clients to make sure we were working on the right stuff. We launched Value Finder, a new AI-powered capability that helps organizations engage underserved customers with messages and offers designed for their specific needs.

This is part of the Pega Customer Decision Hub and expands the power of our one-to-one customer engagement to ensure that all customers get personalized, high-empathy treatment, not just the premier customers that historically have typically gotten the most attention. And we are named a visionary in Gartner's Magic Quadrant for Robotic Process Automation. Now our new business continues to be strongest in our traditional areas of financial services, government, telecom, health care, insurance and the industries that I indicated are more resilient during the pandemic.

And this quarter, our largest new business assessment were with other divisions of existing clients, but we continued to score new logos as well. This is a good indication of our ability to continue to radiate through our excellent customer base,