Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (76228)	9/26/2024 1:24:00 PM
From: Harshu Vyas	Respond to of 78731

My issue with most of these CX businesses is that I think they're especially vulnerable to AI. And many of them already have too much debt on their balance sheets to pivot to a more competitive strategy whilst not burning precious cash in the process. I watch a couple of them closely, though - I won't completely write them off.

To: Paul Senior who wrote (76228)	9/29/2024 10:08:09 PM
From: Steve Felix	Respond to of 78731

Tough time to lower next quarters expectations, with funds squaring up by end of October, and stock already way down on the year. Had 62 shares from $57.30. Damage was done AH and premarket, and I decided to stay in, adding 30 shares, total now from $55.13. Thought the company may help me recoup. We'll see. "We now expect fourth quarter share repurchases to exceed $30 million" Hard to have confidence that they know what they are doing: "During the first quarter, we repurchased approximately 240,000 shares of our stock for approximately $22 million at an average price of approximately $90 per share" "During the third quarter, we repurchased approximately 600,000 shares of our stock for approximately $39 million at an average price of approximately $65 per share" Afaik they are still on target with debt: "and we remain committed to our plan of reducing net leverage to close to 2x adjusted EBITDA " Definitely wouldn't come close to other dumb things I have done. As for AI, two snips: We are driving change in our existing business. One of the many examples in Q3 is from a large infrastructure company that we have serviced for 5 years. This quarter, we deployed an AI bot that in the first month handled 40% of all transactions completely autonomously with a high customer satisfaction rate. For us, this resulted in an immediate 12% reduction in revenue in the near term and some margin pressure as we made upfront investments in technology for a longer-term contract with the client. By automating the simple transactions and delighting the client with the innovation, the client is already having us focus on more complex work, which will lead to increased revenue and margins when fully ramped middle of next year. _____________________________________________________________________________________ As we have seen increased demand for generative AI automation, we quickly mobilized to both increase our capabilities and make our tools commercially available. As we discussed during our last investor call, our investment in the development of our tools increased to a run rate of approximately $100 million on an annual basis. This has proven to be the right strategy and brings me to today's announcement of our launch of iX Hello. This is our first product in our new intelligent experience technology suite aimed at helping organizations harness the power of generative AI across our operations. With our launch of iX Hello, we are giving customers an LLM agnostic generative AI productivity tool that automates and accelerates common internal tasks. iX Hello integrates across internal applications to boost productivity, visibility and quality of work with an on-brand compliant and secure environment. The genesis of our product strategy is very straightforward. Clients saw what we were doing internally, and they realized it was what they wanted, a proven, trusted GenAI productivity tool that integrates knowledge across their front office and back office platforms, is flexible and LLM agnostic that operates in a highly secure, trusted environment. Our increase in investment has not only allowed us to make necessary changes to commercialize IP, but also enhance our practices around our technology partners' products. As always, our clients are at the center of the decision on what to deploy in their environments. We now have close to 1,000 clients who are using generative AI solutions we have implemented at scale every day. In short, as we saw in our Q3 results and our Q4 outlook, the operating environment is very dynamic right now.