Another quarter marked another series of CCaaS megadeals for NICE, as CEO Barak Eilam declared: "We are outpacing the growth of the market."
Two eight-digit customer wins propelled this growth. The first was with a North East energy firm, which will replace several legacy systems and standardize its contact center operations with CXone.
Shedding more light on the deal during an earnings call, Eilam stated:
We won the deal for our domain expertise, our success with other utilities companies, the unmet scalability of CXone, and our ability to deliver conversational AI as an integral part of the platform.
The next deal is with a medical logistics company, again replacing a legacy contact center software.
Eilam credits the win to NICE's "proven track record for large-scale innovation."
Fuelling this innovation is $1.7BN of cash in the bank and $0.5 billion in annual cash flow from operations. According to the CEO, this allows NICE to think and operate more strategically and – ultimately – more dependably.
"[Businesses] want to partner with a vendor that doesn't just speak about innovation, but can also deliver and have the means to deliver it," Eilam says.
In doing so, he underlined NICE's commitment to R&D and somewhat questioned that of its CCaaS competitors.
Eilam: "A Lot of Companies Around Us Are Struggling"
Much of the news in the CCaaS space has centered on Avaya’s Chapter 11 bankruptcy. Yet, when asked to comment on the news, Eilam took a much broader view. He said:
We see a lot of companies around us that are struggling, have never been profitable, and have poor unit economics.
"When you don't have this muscle and all of a sudden, you decide to focus your efforts on the bottom line, and you start to cut. You start to cut on your R&D; you start to cut on your go-to-market. And that impacts customers."
The CEO continued by suggesting that many of NICE’s market rivals carry significant debt, which is proving tricky to service.
“Because of that, they have to take tactical decisions instead of strategic decisions that hurt their customers… Eventually, customers see through that and decide to partner with us,” he stated.
Indeed, NICE has reported an uptick in customers returning to the business less than a year after selecting a competitor's platform and "experiencing disappointment."
Eilam credits "strong market awareness" for this, citing leader placements in the recent CCaaS Gartner Peer Insights and Forrester Wave reports.
Moreover, the CEO added:
After a disappointment of choosing a vendor that is not the leader or maybe was selected for the wrong reason, they don't want to fail twice.
Such a reputation may pave the way for further growth, especially with Eilam suggesting that 80 percent of the industry has yet to shift to CCaaS.
Yet, the provider is not sitting around, waiting for CCaaS to become the norm. It's also building stronger bonds with its existing customers and developing new AI innovations.
AI Is Enabling a Land & Expand Strategy
"We are already seeing many examples of existing customers expanding into our AI-driven CX solutions. And, as a result, our ARR (annual reoccurring revenue) from these customers is going between 3x to 5x," stated Eilam.
