Financial Data and Key Metrics Changes - Q1 gross transaction volume (GTV) was $17.7 billion, up 22% year over year [20] - Q1 total revenue was $215.7 million, up 27% year over year, driven by subscription revenue of $162.7 million, which grew 29% year over year [21] - Q1 platform gross margin was 79.7%, an improvement of over 300 basis points year over year [21] - Q1 operating income was $16.2 million, leading to a record operating margin of 7.5%, an improvement of 560 basis points year over year [22] - Q1 free cash flow was negative $22.3 million, an improvement from negative $24.6 million in the prior year [23] Business Line Data and Key Metrics Changes - Subscription revenue growth was 29% year over year, while usage revenue grew 22% year over year [21] - Professional service revenue for Q1 was $7.7 million [21] - Net dollar retention was greater than 110% for the quarter [21] Market Data and Key Metrics Changes - The company reported healthy growth from both residential and commercial customers [20] - The focus on enterprise customers is increasingly driving growth, with significant interest in standardizing operations around AI and automation [14] Company Strategy and Development Direction - The company aims to expand enterprise capabilities, increase pro product adoption, deepen commercial focus, and grow in roofing [12] - The strategy includes building trade-specific workflows to attract new industries to the platform [9] - The company is focused on becoming the operating system for the trades, with a long-term target of achieving a 25% non-GAAP operating margin [24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate economic uncertainty and emphasized the resilience of customers [30] - The company is managing for long-term growth rather than short-term gains, with a focus on durable compounding growth over many years [24] - Management acknowledged the potential impact of tariffs and supply chain inflation but emphasized the importance of prudent forecasting [30] Other Important Information - The company highlighted successful customer stories that demonstrate the value of its platform, including significant revenue growth for customers using its services [7][10] - The company is actively pursuing partnerships and consolidations in the commercial space, which is seen as a key growth area [65] Q&A Session Summary Question: Impact of tariffs on the business - Management noted that while tariffs could lead to supply chain inflation, customers have historically managed to pass through rising costs [30] Question: Stacking S curve strategy - The company is focused on enterprise, commercial, pro products, and roofing as primary areas of attention for growth [32] Question: Seasonal perspective on GTV - GTV is expected to be stronger in Q2 due to seasonal factors, particularly in trades like HVAC and landscaping [37] Question: Commercial bookings and product roadmap - Commercial bookings are performing well, with significant go-lives and a focus on enhancing product capabilities for construction use cases [44] Question: Average ticket sizes and macro impacts - Average ticket sizes remained stable, with Q2 guidance factoring in weather variability and macroeconomic conditions [55] Question: Visibility from customer go-lives - Customer go-lives provide high visibility into subscription revenue, with a focus on delivering ROI to encourage upselling of pro products [78]
ServiceTitan, Inc.(TTAN) - 2026 Q1 - Earnings Call Transcript