CSG Systems International Inc Q1 2025 Earnings Call Transcript

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

Question: Dan Bergstrom - RBC Capital Markets - Analyst : Hey, thanks for taking my question. Any thoughts you could share as far as what you're hearing from customers around the end of the quarter? Anything to note around those last couple of weeks? We've heard different views across software so far as to whether it was a normal close or there were some elevated uncertainty. And then maybe could you talk to the tone of business through the first month of the new quarter here?

Question: Dan Bergstrom - RBC Capital Markets - Analyst : Will just ask a follow-up then on the margin side, really impressive here in the first quarter, and I appreciate the added color in the script around guidance. The presentation pointed to constantly optimizing and reinventing how you do business around the expense side. Maybe, Brian, could you take a step back and maybe expand on those concepts a bit and then talk to your philosophy around constantly optimizing costs? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 07, 2025 / 9:00PM, CSGS.OQ - Q1 2025 CSG Systems International Inc Earnings Call

Question: Dan Bergstrom - RBC Capital Markets - Analyst : Thank you.

Question: Gregory Burns - Sidoti & Company - Analyst : Good evening, can you just talk about the revenue trends at Charter and Comcast? It looks like Charter -- sorry, Comcast was flat year-over-year, but down sequentially. Maybe that's just a seasonality thing and Charter was down a little bit year-over-year and quarter-over-quarter. So maybe if we could just talk about what's driving that and the general demand dynamics within the cable market?

Question: Matthew Harrigan - Benchmark, Inc. - Analyst : Congratulations on the guidance. I'm curious on the M&A side as you look to be more active and maybe some larger assets get dislodged. I know every circumstance is a little unique and sometimes idiosyncratic. But what are you really looking for? Is it IP? Is it channels? Is it incremental market share right out of the blocks? And generally, what sort of disparity are you seeing in the parent seller versus buyer multiples when you layer in synergies? I know some of it's on the revenue side and it's realized over time, and it's tricky. But just kind of general thoughts more specifically on your ideal M&A candidate. I know probably different companies have different possibilities. And then secondly, also on the thing one and thing two, otherwise known as Charter and Comcast, you've seen some divergence in results. I mean, Charter, I think, has done a better job on bundling and pricing sometimes even though there's a lot of commonalities on the product. But it feels like broadband is just becoming more of a unified category between mobile and fixed line and the walls are breaking down. And it feels like there's even more maybe of an imperative for these companies to have unified billing on a competitive vantage point. So those are my two quick questions, I guess, fairly broad.

Question: Matthew Harrigan - Benchmark, Inc. - Analyst : And since you clearly have a purview even outside the US, if that's the right word on telecom, I would think that even if you look at Europe or Africa or India, you're seeing more of an imperative on companies to kind of break down the walls on the separate billing for broadband and mobile. I know you can't be too specific on Charter and Comcast, but it just feels like it's -- that's ever more of an imperative. And how tricky is it? I mean, how fast could you do that? I mean, based on what you're doing in Africa, for instance, I would think you could probably do that -- implement that pretty fast because you certainly have the experience internationally.

Question: Michael Berg - Wells Fargo & Company - Analyst : Hey, thanks for taking my question. I just wanted to dig in a little bit differently on the telco angle. There look to some weakness in that vertical there. Is that strictly a function of the Charter degradation here in Q1? And maybe you can just dig into both the dynamics of the weakness in Charter and telco and the relationship there. Thank you.

Question: Nehal Chokshi - Northland Capital Markets - Analyst : A couple of questions here. First question is that in the prepared commentary towards the end, you commented on a strong pipeline. Can you give a little bit of characterization as far as what that means numerically? I mean, like does that mean better growth than at least what you're putting up revenue-wise? Or just what does strong pipeline mean?

Question: Nehal Chokshi - Northland Capital Markets - Analyst : And is that shape skewed towards the Ascendant platform?

Question: Nehal Chokshi - Northland Capital Markets - Analyst : And then the other question I had was on cash from operations, definitely much stronger than what we expected. It looks like stronger than consensus. Is it fair to say that it was also stronger than what you guys are expecting?

Question: Nehal Chokshi - Northland Capital Markets - Analyst : Thank you and congratulation.