nCino Inc Q4 2025 Earnings Call Transcript

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

Question: Saket Kalia - Barclays Capital - Analyst : Okay. Great. Hey, guys, thanks for taking my questions here and congrats, Sean, on your promotion to CEO, very well deserved.

Question: Saket Kalia - Barclays Capital - Analyst : Absolutely. Sean, maybe for you. I'm curious what you're hearing back from your customers, just as you -- and I know you spent a lot of time with customers. What are you hearing back from them as they think about their willingness to invest here in 2025, particularly as we look at sort of the implied organic growth here in fiscal '26?

Question: Saket Kalia - Barclays Capital - Analyst : Got it. Got it. Greg, maybe for you. I appreciate the additional disclosure. But I was wondering, could you just maybe dig into the difference between sort of the growth rates between ACV and revenue in fiscal '26? I think the ACV growth at the midpoint is I don't know, high single digits. I think the revenue growth is a couple of points lower than that. How do you sort of think about those two things differently?

Question: Saket Kalia - Barclays Capital - Analyst : Got it. That's super helpful. Thanks, guys.

Question: Terry Tillman - Truist Securities - Analyst : Yes, Thanks. You kind of broke up there, but I think that was for me. So I'll just ask a single question, that's going to be a lot of questions. Just to head up, it's a multiparter though. I think in your all prepared remarks, you all talked about going on the offensive and mentioning increased go-to-market investments, I mean, the results on the gross booking side, definitely underwhelming. But what's -- is this signifying you don't have enough sales capacity? Is it an up-tiering of the sales force? So first, I'd just like to know kind of what's informing kind of the go-to-market investments and then had a second part of the question.

Question: Terry Tillman - Truist Securities - Analyst : Yes. Got it on that. Thanks, Greg and Sean, also, yes, congrats on the new appointment as the CEO. The second part of the question just relates to, I was surprised by the idea of go-to- or -- operating leverage in the second half after some go-to-market investments. Is maybe that apples and oranges, and actually, the leverage you see in the second half is just from normal course of business bookings improving? Or why would we get leverage that fast if you're making investments in the first half of the year? Thank you.

Question: Terry Tillman - Truist Securities - Analyst : Great. Thank you.

Question: Alex Sklar - Raymond James - Analyst : Great. Thank you. Sean or Greg, just on the ACV guidance. I appreciate the disclosure there. In the prepared remarks, you talked about easy macro, improving international activity, exiting the year, better gross retention and then the more strategic product with commercial onboardings in the AI solutions. I'm just curious with all that kind of being factored. Can you talk about the puts and takes that are embedded in that ACV growth outlook, why that wouldn't be better than the kind of 9% constant currency you saw in FY25? Thanks.

Question: Terry Tillman - Truist Securities - Analyst : Okay. Great. Thank you, both. And Greg, maybe just a quick follow-up for you. The $10 million of higher sales and marketing investments this year, can you just talk about how comprehensive those are versus the opportunity that you see? Is this -- is this part one of kind of a multiyear sales and marketing investment cycle? Is this a onetime step up this year to cover some green shoot demand areas, and then we see leverage there? How are you thinking about sales and marketing over a multiyear period? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 01, 2025 / 8:30PM, NCNO.OQ - Q4 2025 nCino Inc Earnings Call

Question: Alex Sklar - Raymond James - Analyst : Perfect. Thank you both for all the color.

Question: James Fawcett - Morgan Stanley - Analyst : Thank you so much. Going in for Michael Infante here this afternoon. I wanted to ask kind of a positioning or market positioning question, just as a reminder, a lot of the commentary from the Treasury and Commerce Secretaries and the new administration have indicated a lot of the deregulation focus has been concentrated on stratifying capital requirements based on bank size, complexity, et cetera, which I think should disproportionately benefit small and community banks, more than regional and enterprise. But can you remind us of your exposure to that smaller cohort? And if you're seeing any of that sentiment reflected in your RFP or engagement activity yet?

Question: James Fawcett - Morgan Stanley - Analyst : Great. That's really helpful nuance there. And then just I wanted to circle back on Pierre's commentary about magnitude of pricing benefit. It sounds like if we're interpreting what you're saying correctly, it could be low single-digit benefit, but curious if we're in the right range and what that will be in fiscal year '26 given the phased rollout. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 01, 2025 / 8:30PM, NCNO.OQ - Q4 2025 nCino Inc Earnings Call

Question: James Fawcett - Morgan Stanley - Analyst : Yes. Like just general -- yes, just generally, the magnitude of pricing benefit. I know that you guys have -- are changing pricing. And just wondering if -- it sounds like you're expecting some of that -- those pricing changes could be a low single-digit benefit this year. But just wondering what that -- if we're understanding that correctly for fiscal year '26 given the phased rollout.

Question: James Fawcett - Morgan Stanley - Analyst : Great. I appreciate that. Thanks so much, everybody.

Question: Koji Ikeda - BofA Securities - Analyst : Thanks, guys, for taking the questions. So in the prepared remarks, you guys mentioned that it's going to take several quarters to see the progress in the 6s and it did seem like you alluded to that there is some confidence there that you're going to be able to achieve that improvement in the execution in the next couple of quarters. So maybe can you go deeper in some of the things that you've done internally or maybe pipeline build trends the changes were made internally that's giving you that confidence to make that statement? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 01, 2025 / 8:30PM, NCNO.OQ - Q4 2025 nCino Inc Earnings Call

Question: Koji Ikeda - BofA Securities - Analyst : Got it. No, thank you for that. And maybe a follow-up here. I do understand you guys are targeting kind of a reacceleration in growth in fiscal '27. But I guess the question here is what is -- what if the growth continues to be constrained for longer than expected into '27? How should we be thinking about balancing the growth and profitability profile in that sort of scenario? Thanks, guys.

Question: Koji Ikeda - BofA Securities - Analyst : Got it. Thanks, Greg. Thank you, guys.

Question: Ryan Tomasello - Keefe, Bruyette & Woods - Analyst : Hi, everyone. Thanks for taking the questions. I wanted to start with US mortgage. One of your US mortgage competitors, I think, recently announced a more formal move into the IMB space and also alluded to some competitive gains. So I was hoping you can provide just more context on how you view the competitive positioning there. And any elaboration on where win rates have been running and how you feel about that position of that business for '26? Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 01, 2025 / 8:30PM, NCNO.OQ - Q4 2025 nCino Inc Earnings Call

Question: Ryan Tomasello - Keefe, Bruyette & Woods - Analyst : Thanks for that. And then in the past, I think specifically, last year, you talked about the visibility you tend to have entering the year on what's already fully baked into the subscription guide. I guess, given the new guidance philosophy here and what sounds like the added conservatism you're baking in, is that visibility higher than usual? And any way to kind of quantify that relative to the organic growth targets you have -- guidance you have set for on the subscription revenue for this year? Thanks.

Question: Ryan Tomasello - Keefe, Bruyette & Woods - Analyst : Thanks for taking the questions.

Question: Cris Kennedy - William Blair & Company - Analyst : Yes. Good afternoon. Thanks for taking my question, and squeezing me in here. Sean, given your former role, can you just provide some perspective on the evolution of your consumer lending product. You guys have been working at it for a long time. We understand bookings -- it was over 50% of bookings last year, but just talk about that evolution, please? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 01, 2025 / 8:30PM, NCNO.OQ - Q4 2025 nCino Inc Earnings Call

Question: Cris Kennedy - William Blair & Company - Analyst : Got it. Thank you for that. And then if you think about -- and maybe you'll give this at the Investor Day, but when you think about the mix of your business over the next three years to five years between the commercial the mortgage, NIC consumer? Any way to think about how that -- how you think that business will evolve over time? Thank you.

Question: Cris Kennedy - William Blair & Company - Analyst : Got it. Thank you.

Question: Aaron Kimson - Citizens - Analyst : Thank you. As a follow-up on that question, a lot of investors see us on nCino is driven around the best-in-class commercial functionality. But it seems like a lot of your focus is on the consumer opportunity where you guys just mentioned again, over 70% of the SAMs. What do you say to a skeptical investor who says, there might be a SAM issue at nCino, particularly on the commercial side, where the consensus is your mode is deepest?

Question: Aaron Kimson - Citizens - Analyst : Thank you. And then as a follow-up, can you remind us how you compete directly or I assume more indirectly with Rocket on the nCino mortgage side? And do you see any potential implications for nCino mortgage from Rocket's to recently announced deals for Redfin and Mr. Cooper stands up closing? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 01, 2025 / 8:30PM, NCNO.OQ - Q4 2025 nCino Inc Earnings Call

Question: Alex Markgraf Markgraf - KeyBanc Capital Markets - Analyst : Thanks for the commentary on retention rates. Obviously, some headwinds in the past couple of years. Just curious, maybe, Greg, what your view is of sort of a normalized or appropriate retention rate for this business?

Question: Alex Markgraf Markgraf - KeyBanc Capital Markets - Analyst : Thanks on that. And then maybe just one follow-up on some of the recent headcount additions. Maybe can you just remind us on sort of the ramp for quota-carrying reps? And then as you think about the geo and product and segment leads across mortgage, EMEA and credit union, just sort of the expected ramp time line to productivity from those folks. Thank you.

Question: Alex Markgraf Markgraf - KeyBanc Capital Markets - Analyst : Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. APRIL 01, 2025 / 8:30PM, NCNO.OQ - Q4 2025 nCino Inc Earnings Call

Question: J.R. Herrera - Piper Sandler - Analyst : Operator, thanks taking my question. This is [J.R. Herrera]. Maybe building a bit more on competition on the AI front specifically. You see any banks looking to experiment more with custom our workflows? Or is customer interest largely revolving around pre-factory solutions?

Question: J.R. Herrera - Piper Sandler - Analyst : That's right.

Question: J.R. Herrera - Piper Sandler - Analyst : Makes sense. And maybe a quick follow-up. Any new feedback to know from larger customers around the shift away from seats to asset-based pricing?

Question: J.R. Herrera - Piper Sandler - Analyst : Got it. Helpful color. Thank you.

Question: Ken Suchoski - Autonomous Research - Analyst : Hey, good afternoon. Guys, thanks for taking the questions. I know it's getting late. I'll ask maybe just about international. I think you highlighted international as a contributor to that a 6 percentage point impact on subscription revenue growth in fiscal year '26. I think you guys had a good slide on the guidance assumptions. Is international the entire 6 percentage point impact. So that was, I guess, one question. And then I think you mentioned some leadership changes in Europe. Any additional detail in terms of what's happening in the region? And is it only Europe where you're seeing some issues? Or are there other markets that are contributing to that 6 percentage points? Thank you.

Question: Ken Suchoski - Autonomous Research - Analyst : Okay. Thank you, both.