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The main driver for our 16% increase in revenue growth was cloud growth: NICE CEO

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Barak Eilam, NICE CEO, joined Yahoo Finance Live to break down the key takeaways from NICE's recent earnings report and what the forecast looks like for the remainder of 2021.

Video Transcript

- Jonah let's bring in the CEO from Nice. This is Barack Eilam. He's joining us because their revenue growth in the quarter, up 16%, cloud revenue growth 32%, for the second quarter of 2021. When you talk about Nice, we think about enterprise solution software, but also, I'm going to try and put it in simple terms that a Luddite like myself might understand. If I call American Airlines, and I'm at the call center, but I might not realize is in the background, your AI software might be helping them with an angel like on the shoulder guide me to a better outcome. Is that what's at play here?

BARAK EILAM: Thank you very much for having me. I think you describe it extremely well. This is exactly what we've been doing for the past two decades and in the last few years. We've been extended expanding our solutions to do exactly what you suggest being the guiding angel to those agents, whether these are human beings or robots that are serving you. In one purpose to provide extraordinary services and extraordinary experiences to consumers.

- Let's talk about what's driving your business because I was taking a look at the chart here over the past year. Shares up just around 30, 35%. You've seen some growth. You just reported a 16% jump in revenue. I guess at this point. What's the biggest driver of some of that momentum that we're seeing?

BARAK EILAM: So, we indeed reported just today. Our second quarter earnings, which is 16% on the top line, and the main drivers for that was growth in the cloud. 32% in our cloud revenue that now represent more than 50% of our business. Crossing the billion dollar in annual revenue run rate, and the main driver is what we see that our market is starting to cloudify and get to the cloud. We're already at a billion in cloud revenue, but this is just the beginning. Only 10% of our market has been cloudified, and it is now starting to move up market into the large enterprises. So, that's one driver, and the second one is the expansion from just contact centers as you describe it to a full digital CX and analyzing and managing the full consumer journey whether it's on digital channels or in the contact center.

- Help us understand what that looks like with so much potential growth with the cloud. If I'm a business, and I've got sales agents and all kinds of people that are interacting with customers, I no longer need to buy the software and store it on servers within my shop to help them. I can very efficiently, very quickly plug into your system, and then with the software you provide, we go down the road at a much more affordable pace?

BARAK EILAM: Exactly. This market, a customer engagement market, had an old paradigm with a lot of legacy solutions that are an on premise one. These solutions, as you said, are deployed on premise by legacy providers. But it didn't provide the agility, the elasticity, and most of all, the pace of innovation that enterprises want in today changes in fast changing consumer preferences. So the whole notion of moving to a new platform-- and we offer our platform is the leading one in the market called CXone-- is the ability to immediately get those services from the cloud, have it on demand, and have a very rapid pace of innovation. Because these solutions, are solution CXone, is constantly updating and providing hundreds of new features and capabilities every year without any need for organizations to do any deployments on their end or [INAUDIBLE] data centers.

- What about your competitors out there? I mean, is anyone else doing exactly what you're doing?

BARAK EILAM: So, we operate in a very large and fast growing market. Today is the Time. The total addressable market of our market is roughly about $8 billion going rapidly into $20 billion. So, there are a lot of competitors. It's a highly fragmented market, but we and a couple of others are in the leaders, and we have considered by Gartner to be the leader of our market. I think that the difference from other markets is that it is a very feature rich. Market that requires a lot of domain expertise and it's a very of entry into our market is extremely high. So, it didn't start yesterday the market is active for many years now. So, the leadership that emerge in this market provide us today a pretty strong presence and a pretty optimistic view into the future. We just started our qualification as I said before, and there is a very long runway for our business over here.

- With most of us, on the other side, not aware that we might be dealing with people who are using your software, whether it be in the cloud or just the enterprise solutions that you provide. Would it be through a customer, call center kind of situation or is it more B2B? Is it going to be more in a sales kind of environment? How do we encounter you when we don't know it? Most of often.

BARAK EILAM: So, it's both. Mainly on the customer service. We are all consumers, you and I are consumers, and we interact with foreign banks and utilities companies and telcos. And I'm sure we all have this feeling that we don't have the same experience as we have when we communicate with our friends and family is the one that we have with organizations or utilities or banks that we want to communicate with. And that's exactly what we do. Our vision is to take out the friction from those conversations and provide us, the consumers, the exact same experience as we have in the communication with our friends and family.

- We wish you the best and congratulations on the quarter on the earnings report, the CEO from Nice, Barack Eilam. Good to have you.