Pegasystems Inc at RBC Capital Markets Technology, Internet, Media and Telecommunications Conference Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Rishi Jaluria - RBC - Analyst : Yes. So as you can imagine, most of our dollar is probably going to be on the cloud transition and Blueprint (technical difficulty) your conversations And cash flow. Yes, we'll definitely talk a lot about that. Maybe let's start on the cloud side. So what incentives are there for customers to be on Pega Cloud? What can they do with Pega Cloud that they can't do with client cloud? And from your own perspective, how that ACV translate?

Question: Rishi Jaluria - RBC - Analyst : Yes. That makes a lot of sense. Take you to the numbers. So we saw an accelerate to, I think, 26%, 18% overall. Should we be thinking about the growth of both of these going forward, especially because you're tracking ahead of your own 2024 guide?

Question: Rishi Jaluria - RBC - Analyst : Yes, absolutely. So now let's rewind it back to the Analyst Day. You talked about the path to get to $2 million in ACV, and you had growth rates of 10% to 17%. What's kind of your latest thinking around the path to get there? And what's, how should we be thinking about like what's the most likely outcome?

Question: Rishi Jaluria - RBC - Analyst : Okay. Let's go jump right into blueprint. And I promise we'll save some time to talk about cash flow as well. It's near and nearer to your heart. Maybe number one look, a lot of people aren't super deeply familiar. So walk us through what exactly Blueprint is and maybe if we can give one or two illustrative examples. Let's start with that and then we can jump into some specifics around it.

Question: Rishi Jaluria - RBC - Analyst : Super helpful. Let me just follow up on that. What's driving what seems to be this uptick in Blueprint adoption and usage? And how should we think about the monetization of it?

Question: Rishi Jaluria - RBC - Analyst : Just what's driven like.

Question: Rishi Jaluria - RBC - Analyst : Yes. So I want to follow up on that because this stuff still takes a lot of time. But when you're talking to customers who actually want to use GenAI, what are you hearing from them in terms of concerns, right? Because a lot of the G2K has really been stalled out in their GenAI adoption, partly because of concerns around security and privacy. It still seems like you're getting real adoption there. So what's kind of that tipping point to get them over there?

Question: Rishi Jaluria - RBC - Analyst : Yes. Okay. So I want to continue down that path because if we think about data, I think there's two things. Number one, LLMs will generate their own unique type of data that really just didn't exist before. And number two, as GenAI gets more adopted by enterprises, it may just completely change the way that we do things. What positions Pega well to take advantage of that new way of bringing in new data sets?

Question: Rishi Jaluria - RBC - Analyst : Yes. Okay. Really helpful. And then maybe last on Blueprint, and then I want to move into a couple of other areas. But you talked at the very beginning in the past, you would work with these GSIs on these projects. How was the reception from the partners been around Blueprint? And is there a worry that there's some cannibalization there?

Question: Rishi Jaluria - RBC - Analyst : Yes. Okay. So now you talked a little bit about verticals at the beginning. One vertical you mentioned was government. How should we be thinking about any impact from the US presidential election going forward, including during the transition period and with the recent Department of Government Efficiency or DOGE, that's a real sentence I just said out loud, but how should we think about the impact of that on Pega?

Question: Rishi Jaluria - RBC - Analyst : Yes. All right. So since you stepped into this role, you've been talking about Rule of 40 from day 1. You're getting very close to a Rule of 40 territory. What's been driving that? And what have you done to align your own employees with that Rule of 40 mindset?