And with that, let me turn the call over to Justyn.

Justyn Howard: Thank you, Jason, and good afternoon, everyone. Thank you, as always, for joining us. We are proud to deliver fantastic fourth quarter results. We’re entering 2024 with notable momentum and an expanding scope of growth opportunities. Earlier this month, we were rated as the number one best software product by G2 across the entire software industry, adding to leadership across all of the major categories in which we compete. We believe our product leadership and outstanding execution have Sprout position for a breakout year as we define category leadership. During Q4, we saw continued record new business ACVs and total ACV growth of 43% year-over-year. We added record net new organic 10K and 50K customers, and our premium product attach rate is now 30%, with premium product ARR growing greater than 50% year-over-year.

We added record net new ARR, a record increase in deferred revenue, and step change increase in RPO and CRPO. New RPO, or total contract value bookings, was nearly 80% higher than any quarter in our history. New CRPO bookings increased nearly 3x year-over-year. Our focus strategy is yielding powerful results. Our customers are making increasingly large and long duration investments in social, which we believe will converge reported leading indicators upwards towards CRPO over time. We believe this will have the compounding effect of accelerating the durability and efficiency of our future growth. Our industry is maturing, and new research from Deloitte Digital says it far better than we could. Social-first brands are repositioning social media at the core of the entire brand and customer experience as a key strategic priority.

Our goal is to make Sprout the industry standard publishing and engagement platform, and to make social listening, social advocacy, influencer marketing, and sophisticated reporting core to the workflow of the world’s most innovative brands. We see massive potential to unify what should be standard social capabilities for all global businesses, and to accelerate premium product attach rates and ACV growth. Exiting 2023, our premium product attach rate increased to 30%, and total premium module ARR is now growing greater than 50% year-over-year. Tagger will play an important role in our platform strategy and the growth potential entering 2024, is proving to be greater than we had planned. It is increasingly clear that social media management and influencer marketing demand to live together for both workflow and reporting.

We continue to execute on our differentiated value position, with inbound interest coming from a diverse set of current customers and geographies. With more than 3x current Sprout ACVs and a meaningful opportunity to further differentiate Sprout while cross-selling into our customer base, we believe Tagger is on track to achieve our $100 million ARR target. Stepping back to our broader product strategy, our customer-led rankings on G2 are an outcome of our aggressive product investments over the past 24 months. We’ve accelerated our platform investments in AI, Social Customer Care, listening, advocacy, and industry-defining integrations. We believe differentiated product integrations with amazing partners like Salesforce, the product-enhancing acquisitions of Tagger and Repustate, and rapidly expanding enterprise capabilities have positioned Sprout to lead our category.

Last week’s announcement of Social Customer Care by Sprout is a notable output of this innovation as we seek to establish ourselves as the clear choice for Social Customer Care. We’re now delivering faster, more personalized, and more complete customer support with AI-powered case management, intuitive reporting, and out-of-the-box integrations with leading customer care platforms like Salesforce, Zendesk, and Microsoft. Social Care is the fastest growing market on our SAM, and we believe we are well positioned to lead that market. We delivered more than 150 material new product enhancements in total during 2023, more than 25% greater than each of the prior 3 years, and we believe our pace of innovation is only getting started. This pace of change also aligns to the pace of change in the market, which is evolving faster than ever.

We were proud to elevate our relationship with Reddit earlier this month for Tagger to lead the new creator API with Snapchat, to join Meta’s AdTech partner program, and to currently be working as an Alpha partner for Meta’s Threads API. We’re deepening our relationships across our partner ecosystem, and are proud to be core to many other key 2024 partner priorities that will deliver utility to our shared customers. We believe our single code base coupled with strong and dynamic partner relationships are key competitive differentiators for Sprout, and are extending our moat as we scale. Sprout’s recognition as the number one best software product ranked by G2 highlights the incredible success our customers are having. In fact, during 2023, our customers cumulatively spent more than 6 million hours of time in Sprout, and we processed over 1.5 trillion messages and actions for them.

We’ve doubled down on our thesis that social is maturing as the primary communication channel between brands and their customers. The continuing maturity of the market is solidifying Sprout as the social system of record, intelligence, and action. We aspire to set the bar for innovation in our industry and to emerge as the market leader. The logos you’ll hear, Ryan, talk about shortly are equal parts humbling and indicative of where we are as an organization. We outlined our next great growth chapter last fall in Investor Day, and we’re executing well as we progress toward our goal of $1 billion in annual revenue. Going into 2024, we believe we have the right team, platform, and approach to realize our full potential. And with that, I will turn the call over to Ryan.

Ryan Barretto: Thanks, Justyn. 2023 was a year filled with great progress, milestones, and success. We evolved our long-term strategy, while proving that we are perfectly positioned to make the largest and most complex customers successful. I have so much gratitude for our team who operate with relentless focus, work ethic and excellent execution, and deep appreciation for our customers who put their trust in us every day and are seeing the increasing value of social delivered through our platform. Our customer success is clearly driving our success. So, I think it’s fitting that I kick off by highlighting the iconic brands that we are fortunate to grow with during Q4, which included X formerly known as Twitter, DHL International, Brown-Forman Corporation, Kenvue, PG&E Corporation, The CW Network, Archer-Daniels-Midland, U.S. Chamber of Commerce, American Honda Motor Company, Whirlpool, Avis Budget Group, Panasonic, Nationwide Children’s Hospital, Sega of America, Grab Taxi, Becton Dickinson, and CoStar Group.

Our most sophisticated customers are social-first organizations that rely on Sprout to drive efficiency and innovation, and our new customer advanced micro devices is a perfect example of what this looks like. Chris Downey, Director of Social Media at [AMB Share] [ph], we are excited to enhance our social strategy with Sprout Social. We are a data-driven organization and our goal is to empower our teams with intuitive software that can improve efficiency across our organization. With Sprout, we now have the ability to improve our publishing collaboration, streamline social customer care, and make impactful decisions with sophisticated reporting capabilities. Focus matters, and we’re focused on being the social platform powering the world’s most innovative brands.

At the same time, customers are highlighting to us that they’re seeing our competitors investing less in their team, in their customers, and in their products. This is reinforcing the strength of our strategy and our differentiation. You can see this in the usability of our platform and how leading with the product has become the primary driver in our strengthening wineries in the enterprise. Our recognition has been number one best software product on G2 is a reflection of all this. G2 is the world’s largest and most trusted software marketplace, where 90 million software buyers seek out advice and where rankings are based exclusively on user reviews. Sprout was the best software product overall. This is a reflection of the differentiation of our software and the strategic value our customers derived from our platform and products.

Building from the position of product leadership, it was just over a year ago that we dialed in our strategic focus. We’ve moved away from the inefficient growth anchor at the low-end of our category and accelerated our momentum into the fastest growing tiers of our TAM, where the unit economics are strongest and where we believe our competitive differentiation increasingly stands out. Speaking deeper into the research from Deloitte Digital that Justyn just records, social-first brands are 4.7 times as likely to use social platforms extensively for customer care, 3.1 times as likely to manage paid and organic budgets together, 10.7 times as likely to report their influencer marketing strategy is effective, and my favorite, these brands are 8 times as likely to have exceeded revenue goals by 25% or more.

We have to remember that all of this is driven by consumer behavior and expectations, and social first brands are beginning to not only see measurable business results, but are prioritizing social across the entire organization. And because of this, the deeper we go into the enterprise, the more we’re able to unlock new greenfield growth opportunities, either because legacy and often silo technologies couldn’t meet the need, or because businesses are at the right point in the maturity to adopt a social-first strategy. Sinclair Broadcast Group is a great example of this. They were a new Q4 customer that moved from managing social natively to standardizing on Sprout. News never stops, and social is the first place people look for information and updates, said, Nickolas James, VP of Social Media at Sinclair Broadcast Group.

Without a social media management tool in place, it would be impossible for us to coordinate efforts across nearly 500 accounts. The usability of Sprout’s platform creates operational efficiencies that allow our teams to focus on important work they’re doing and to deliver even more impactful stories to their communities. Unlocking more value, making our customers’ lives easier, and helping them get value quickly is all part of our value proposition. Memorial Hermann Health System is a great example of this dynamic. Andy Pape, Head of Content and Social Strategy, shared Sprout allows our team to punch above our weight. The comprehensive platform provides a user experience that makes it painless to engage your audience, build their brand, and manage your reputation at scale.

Sprout’s powerful analytics makes it easy to report on our successful outcomes and get alignment on our strategies. The user experience is intuitive, which has made our team happier and more efficient since making the switch. We continue to focus on expanding our partner ecosystem to further build out our future flywheel. Our partnership with Salesforce continues to set an amazing precedent for future success with other partners. During Q4, we delivered another very strong performance with new logos similar to Q4 of last year, but with 40% more new ARR than Q4 2022. This is not only due to working with more complex Social Studio deployments as they near end of life, but because of our unique integration into Salesforce, which is enabling brands to do more with social than ever before.

We have a massive opportunity to execute with Salesforce in 2024. And as we’ve shared before, we also see an even larger opportunity in the years ahead as we work to make Sprout the standard social platform for any Salesforce customer. We believe our social customer care platform together with Salesforce Service Cloud, in particular, is the future of omnichannel care. As we reflect back on the progress we’ve made over the past year, I’ve never been more excited by the differentiation of our platform, the strength of our team, and our focused investment strategy to deliver outsized value to all social-first brands. We’re excited for 2024 as we continue building a category defining software franchise. And with that, I’ll turn it over to Joe to run through the financials.

Joe?

Joe Del Preto: Thanks, Ryan. I’ll now walk you through our fourth quarter fiscal 2023 results in detail before moving on to guidance for the first quarter and full year 2024. Revenue for the fourth quarter was $93.6 million, representing 34% year-over-year growth and well ahead of plan. Subscription revenue was $92.2 million, up 33% year-over-year. Services revenue was $1.4 million, up 175% year-over-year. Total ARR as in Q4 was $385.2 million, up 30% year-over-year, and ahead of our expectation. Record ARR was led primarily by rapid enterprise new business growth, accelerating premium module attach rates, and continued early Tagger momentum. Importantly, we also entered 2024 without low-end ARR that has been anchored on our performance.

Non-core customers further declined in Q4 and now represent less than 800K in ARR. This business will no longer be a headwind to growth in 2024. The number of customers contributing more than $10,000 in ARR, grew 31% from a year-ago. The number of customers contributing more than $50,000 in ARR, grew 44% from a year-ago. Q4 ACV growth was a record 43% year-over-year. Record new business deal sizes and early returns from influencer marketing each compounded ongoing healthy seat expansion and premium module attach rates. We expect rapid ACV growth, similar to second half 2023 ACV growth rates to continue over the medium term during my strengths and enterprise, influencer marketing and customer care. In Q4, non-GAAP gross profit was $74.2 million, representing a non-GAAP gross margin of 79.3%.

There’s up 60 basis points compared to a non-GAAP gross margin of 78.7% a year-ago. Non-GAAP sales and marketing expenses for Q4 were $39.6 million, or 42% of revenue, up from 41% a year ago. We continue to hire aggressively in our enterprise sales and growth organization. Non-GAAP research and development expenses for Q4 were $17.1 million, or 18% of revenue, down from 19% a year ago. We continue to invest in our future and our increasingly targeted investments in AI and social customer care are delivering strong returns. Non-GAAP general and administrative expenses for Q4 were $15.8 million or 17% of revenue, down from 18% a year ago. We expected to deliver consistent G&A leverage as the percent of revenue moving forward. Non-GAAP operating income for Q4 was $1.7 million, for 1.8% non-GAAP operating margin, an improvement of 100 basis points year-over-year.

Non-GAAP net income for Q4 was $1.0 million, for non-GAAP net income of $0.02 per share based on 56.1 million weighted average shares of common stock outstanding compared to a non-GAAP net income of $1.8 million and $0.03 per share a year-ago. Turning to the balance sheet and cash flow statement, we ended Q4 with $98.1 million in cash, cash equivalents, and marketable securities. This is down from $121.4 million at the end of Q3 and reflects earlier payment on a revolving credit facility. Deferred revenue at the end of the quarter was $141.5 million, a record sequential increase. Looking at both our billed and unbilled contracts, RPO totaled $275.0 million, up from $228.7 million exiting Q3, and up 69% year-over-year. We expect to recognize 72% or $198 million of total RPO as revenue over the next 12 months and playing a CRPO growth rate of 62% year-over-year.

The acceleration of these metrics reflects our underlying momentum in the enterprise, highlights rapidly improving quality of our business, and revenues are highest ever quarterly total contract value bookings by nearly 80%. To make sure, our business has changed maturely, we have increasingly fewer month-to-month customers, which has been a drag on reported ARR as we’ve shifted resources to support higher value customers. Billings in RPO are likely to be increasingly informative leading indicators. We believe that our sustaining high gross momentum into mid-market enterprise is likely to converge a reported metric towards CRPO over the next 12 to 18 months. Operating cash flow in Q4 was negative $2.6 million compared to positive $3.0 million a year-ago.

Non-GAAP free cash flow was negative $0.3 million, down from a year ago. While working through the final stages of Tagger integration, accounts receivable also increased by nearly double the amount of Q4 2022, reflecting an expanding enterprise renewal base, which we believe will make our cash flow more seasonally weighted towards Q1 over time. For the full year 2023, non-GAAP free cash flow was $10.2 million or 3.1% free cash flow margin. We expect free cash flow margins to continue to turn above our non-GAAP operating margins in 2024. In 2023, our overall dollar-based net retention rate was 107%, down from 109% in 2022. A dollar-based net retention rate, excluding SMB customers was 111% in 2023 compared with 116% in 2022. Our strategic changes in 2023 and the emphasis on low-value, low-potential customers accelerated sharing on our SMB and agency segments, which was a substantial drag on reported NDR.

We believe this adds its set spread out for very strong NDR in 2024 as we continue to shift our business towards total net retention north of 120% over our medium-term forecast horizon. Shifting to formal guidance. For the first quarter of fiscal 2024, we expect revenue in a range of $97.2 million to $97.3 million or growth rate of more than 29%. We expect non-GAAP operating income in the range of $0.6 million to $0.7 million. This represents a non-GAAP operating margin of 0.7% at the midpoint. We expect a non-GAAP net income per share of between $0.00 and $0.01. This assumes 56.4 million weighted average basic shares of common stock outstanding. For the full year 2024, we expect total revenue in the range of $425.3 million to $425.5 million and expected overall reported growth rate of approximately 28%.

For the full year 2024, we expect non-GAAP operating income in the range of $50 million to $60 million. This implies annual non-GAAP operating margin improvement of roughly 220 basis points. We expect non-GAAP net income per share of between $0.22 and $0.23, assuming 57.0 million weighted average basic shares of common stock outstanding. Over the course of 2023, we have aligned our business and our investments around the most productive and fastest growing segments of our market. We believe we transformed our business model to position us to deliver increasingly durable and increasingly efficient growth. With that, Justyn, Ryan and I are happy to take any of your questions. Operator?

Operator: [Operator Instructions] Our first question comes from Raimo Lenschow from Barclays. Your line is now open.

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