Live Earnings Conference Call: DHI Group will host a live Q1 2025 earnings call on May 7, 2025 at 5:00PM ET. Follow this link to get details and listen to DHI Group's Q1 2025 earnings call when it goes live. Get details. NYSE:DHX DHI Group Q4 2023 Earnings Report $1.23 -0.10 (-7.52%) Closing price 05/6/2025 03:59 PM EasternExtended Trading$1.35 +0.12 (+9.76%) As of 08:46 AM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast DHI Group EPS ResultsActual EPS$0.04Consensus EPS $0.05Beat/MissMissed by -$0.01One Year Ago EPSN/ADHI Group Revenue ResultsActual Revenue$37.29 millionExpected Revenue$35.82 millionBeat/MissBeat by +$1.47 millionYoY Revenue GrowthN/ADHI Group Announcement DetailsQuarterQ4 2023Date2/7/2024TimeN/AConference Call DateWednesday, February 7, 2024Conference Call Time5:00PM ETUpcoming EarningsDHI Group's Q1 2025 earnings is scheduled for Wednesday, May 7, 2025, with a conference call scheduled at 5:00 PM ET. Check back for transcripts, audio, and key financial metrics as they become available.Q1 2025 Earnings ReportConference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Annual Report (10-K)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by DHI Group Q4 2023 Earnings Call TranscriptProvided by QuartrFebruary 7, 2024 ShareLink copied to clipboard.There are 7 speakers on the call. Operator00:00:00Good afternoon, and welcome to the DHI Group 4th Quarter and Full Year 2023 Financial Results Conference Call. All participants will be in listen only mode. Please note, this event is being recorded. I would now like to turn the conference over to Todd Kehrli of MKR Investor Relations. Please go ahead. Speaker 100:00:43Thank you, operator. Good afternoon, and welcome to DHI Group's 2023 4th Quarter and Full Year Earnings Conference Call. With me on today's call are DHI's CEO, Art Zeile and Rainey Levy, DHI's CFO. Before I turn the call over to Art and Ramey, I'd like to cover a few quick items. This afternoon, DHI issued a press release announcing its 2023 4th Quarter and Full Year Financial Results. Speaker 100:01:09The release is available on the company's website at dhigroupinc.com. This call is being broadcast live over the Internet for all interested parties and the webcast will be archived on the Investor Relations page of the company's website. I want to remind everyone that during today's call, management will make forward looking statements that involve risks and uncertainties. Please note that except for historical information, statements on today's call may constitute forward looking statements within the meaning of federal securities laws. These forward looking statements reflect DHI Management's current views concerning future events and financial performance and are subject to risks and uncertainties, and actual results may differ materially from the outcomes contained in any forward looking statements. Speaker 100:01:56Factors that could cause these forward looking statements to differ from actual results include the risks and uncertainties discussed and the company's periodic reports on Form 10 ks and 10 Q and other filings with the Securities and Exchange Commission. DHI undertakes no obligation to update or revise any forward looking statements. Lastly, during today's call, management will be referring to financial measures, including adjusted EBITDA, adjusted EBITDA margin and adjusted diluted earnings per share, which are not prepared in accordance with U. S. GAAP. Speaker 100:02:31Information about and reconciliations of these non GAAP measures to the most directly comparable GAAP measures are available in our earnings release, a copy of which you can find on our website at dhigroupinc.com in the Investor Relations section. With that, I'll now turn the call over to Art Zayle, CEO of DHI Group. Art? Speaker 200:02:54Thank you, Todd. Good afternoon, everyone, and welcome to our 2023 4th quarter and full year earnings conference call. We appreciate your time today as we discuss our financial performance for 2023 and our future outlook. First, let's discuss the state of the tech labor market. There is no doubt that 2023 was a challenging year for tech hiring. Speaker 200:03:19Over 260,000 tech workers were laid off in 2023 compared to 165,000 in 2022. And based on monthly BLS data, the U. S. Tech population only increased by 78,000 workers in 2023 versus $486,000 in 2022. This coincided with a decline in actual tech job postings throughout the year, where monthly job postings averaged approximately 220,000 in 2023 compared to 390,000 in 2022, a drop of over 40%. Speaker 200:03:58We attribute much of the decline in tech hiring in 2023 to a recalibration From the massive hiring that occurred in 2021 2022 coming out of the pandemic, along with caution exercised by companies in a very uncertain environment. Looking ahead, customer sentiment remains very cautious, With most economists forecasting a slowdown in GDP growth in 2024 to a rate between 1% 2%. Having said that, we believe the backlog of desired tech investments continues to grow inside enterprises And we expect these important technology initiatives will be high priorities once the macro uncertainties begin to clear, which in turn will drive demand for our hiring platforms. Despite all of this uncertainty and its knock on consequences, We continue to operate effectively and efficiently as evidenced by our ability to grow our revenue in 2023 as well as expand our profitability. While we wait for commercial tech hiring to return, we have started to see our ClearanceJobs bookings strengthen after the signing of the National Defense Authorization Act in mid December, which provides for a 3% increase in defense spending compared to fiscal year 2022. Speaker 200:05:19This is a big positive for CJ, although the possibility of a government shutdown still creates a tougher sales environment for us. Given that Dice represents approximately 2 thirds of our aggregate revenue, the question remains when we will see tech hiring start to increase back to a normalized level. We believe that this is a matter of when, not if it will do so. As I've mentioned before, McKinsey Global Institute believes jobs will grow at a rate of 23% from 2022 to 2,030 because of the continued digitization of our economy and the implementation of AI. This theme is consistent with KPMJ's Annual CEO survey released just a couple of weeks ago, which stated that 72% of U. Speaker 200:06:10S. CEOs say that generative AI is a top investment priority. All of this data supports the long term Secular trend of tech hiring and gives us confidence that once businesses have a collective sense of confidence in our economy, They will accelerate their investment in technology initiatives and will need our platforms and our 8,000,000 candidate profiles to find, attract and hire the best tech professionals for their job postings. While we wait for the overall tech hiring environment to improve, We continue to focus on what we can control, including improving our industry leading product offerings and our go to market engine. Now let me dig into our performance during the quarter and what we see ahead for 2024. Speaker 200:06:59In the 4th quarter, our total revenue declined 6 percent year over year. Dice revenue for the quarter decreased 13% year over year, while CJ revenue increased 9%. The decrease in Dice revenue was the result of lower new business bookings and renewals over the past several quarters, as well as continued lower one time transactional revenue, all of which are a reflection of the uncertain economic environment I have described. Having said that, excluding transactional revenue, our total recurring revenue was up 2% year over year in the Q4 across the two platforms and for the full year our total recurring revenue was up 9% year over year. Looking at our bookings performance, while our total bookings were down 4% for both the 4th quarter and the full year, Our bookings for our recurring revenue products were up 1% for the quarter and 3% for the full year. Speaker 200:08:02Dice secured several new clients this quarter, including Tech Systems, Ciena Corporation and Infosys, As we remain focused on those industries and specific companies that are hiring tech professionals even in today's weakened economic environment. Those industries include aerospace, business consulting, healthcare, financial services and education. While Dice new business teams continue to see more intense deal scrutiny in this difficult macro environment, we saw a meaningful improvement in our new business team bookings from the 3rd to 4th quarter, including for our Dice Commercial Accounts team. ClearanceJobs bookings for the 4th quarter increased 15% year over year, despite the uncertainty caused by a potential government shutdown. CJ secured several new clients this quarter including Sierra Space, Omitron and Henckels and McCoy. Speaker 200:09:01As I mentioned earlier, the most recent National Defense Authorization Act provides for a 3% increase in spending. It was signed midway through December and has started to positively impact the demand for cleared tech professionals. As a result, we expect increased bookings and revenue growth for CJ in 2024. Moving on to account management, our Dice and CJ revenue renewal rates were 78% 96 percent respectively in the 4th quarter. Retention rates for Dice and CJ were 97% 110% respectively. Speaker 200:09:42While we continue to see customer attrition for Dice, it continues to be concentrated with smaller clients that have been more impacted by the macroeconomic environment than our larger accounts. These smaller accounts typically spend less than $10,000 a year with us. During the Q4, we delivered a 27% adjusted EBITDA margin, which was up significantly from 20% a year ago. In the Q4, we saw the full benefit of the organizational restructuring we announced last year, which included a 10% reduction in workforce that streamlined our team structure and improved our operating margins. During the Q4, we made some additional smaller changes to the sales organization, largely affecting underperforming team members. Speaker 200:10:31We also reduced marketing campaigns for new candidates as we benefited from an elevated amount of candidate activity in this weak employment environment. For 2024, we will continue to focus on operating our business efficiently and are targeting a full year adjusted EBITDA margin of 24%. During the quarter, We continue to strengthen our industry leading product offerings. Dice delivered an improved company search function for candidates as well as SMS notifications. Dice also introduced programmatic listings, which allow job advertising agencies to digitally feed job opportunities into the Dice platform and pay only for candidate job views and applies, consistent with contracts they have signed with their underlying clients. Speaker 200:11:24We also tested new pricing bundles that combined unlimited job postings, a company page and selected job boosts for harder to fill positions. We believe these bundles have the potential to increase new customer annual contract value and improve our existing customer retention rates. The initial results were positive and we are continuing to test this new pricing model. ClearanceJobs continue to develop CJ Live during the quarter. CJ Live will enable employers to create and deliver video based content to boost candidate engagement. Speaker 200:12:04In summary, while the difficult economic environment has had a temporary impact on our total revenue growth rate, Our recurring revenue continued to grow in the 4th quarter and for the full year. We believe there remains a long term secular trend for adding more tech workers in the U. S. And as the economic uncertainty recedes and as companies across all industries continue their investment in technology initiatives, we expect increased demand for our tools that enable companies to attract, find and hire the right tech professionals for their open positions. Until then, we will continue to focus on improving our products and our go to market execution, so that we are ready to capitalize on this anticipated increased demand for our tools, while doing so in a more efficient and profitable manner. Speaker 200:12:57Lastly, on our past earnings call, we announced the addition of Ramey Leebie as our new Chief Financial Officer. What impressed us most about Ramey is our virtual skill set, including direct responsibility for F and A, Financial Operations, Tax, Treasury and M and A functions, but also the multitude of times in her career where she saw Tough business challenges by taking on additional responsibilities in operations, sales and strategy roles. Rami started with us early in December and has hit the ground running and is doing a great job. On that note, let me turn the call over to Rami, We'll take you through our financials and our guidance and then we'll take any questions you may have. Raimi? Speaker 300:13:47Thank you, Art, and good afternoon, everyone. Before I begin, I would like to say that I am very excited to join the amazing team at DHI Group. It is great to join an enterprise that is a leader in its space and has a significant value proposition with its industry leading product offerings. While I have only been here a couple of months, I can tell you it has been a pleasure to work with Art, our Board of Directors and the terrific DHI team. I can't wait to help the team continue growing this business and I look forward to getting to better know our shareholders and the analysts that cover DHI. Speaker 300:14:25Now let me take you through our financial results for the quarter. We reported total revenue of $37,300,000 which was down 6% a year over year basis and essentially flat versus the prior quarter. Total bookings for the quarter were $36,100,000 down 4% year over year. As Art mentioned, our total recurring revenue was up 2% for the 4th quarter and 9% for the full year and the bookings that drive our recurring revenue were up 1% for the 4th quarter and 3% for the full year. Dice revenue was $24,600,000 which was down 13% year over year and down 1% sequentially. Speaker 300:15:10DICE bookings were $22,200,000 down 14% year over year. We ended the quarter with 5,492 DICE recruitment package customers, which is down 5% from last quarter and down 13% year over year. Our average annual revenue per Dice recruitment package customer was up 2% sequentially and up 3% year over year to $15,780 Approximately 90% of Dice revenue is and comes from annual or multi year contracts. For the quarter, our Dice revenue renewal rate was 78% and our retention rate was 97%. Clearance jobs revenue was $12,700,000 up 9% year over year and flat sequentially. Speaker 300:16:04Bookings for CJ were $13,900,000 up 15% year over year. We ended the 4th quarter with 2,055 CJ recruitment package customers, which was flat on both the sequential and year over year basis. Our average annual revenue per CJ recruitment customer was up 10% year over year and up 2% sequentially to $21,872 Approximately 90% of CJ revenue is recurring and comes from annual or multi year contracts. For the quarter, CJ's revenue renewal rate was up sequentially to 96% and CJ's retention rate was strong at 110%. The outstanding retention rate demonstrates the continued value CJ delivers in the recruitment of cleared professionals. Speaker 300:16:59Turning to operating expenses, 4th quarter operating expenses were down 13% to $33,800,000 when compared to $39,000,000 in the year ago quarter. As with the 3rd quarter, our 4th quarter operating expenses reflect a full quarter of the cost savings associated with the May restructuring, which is expected to generate annual cost of approximately $8,000,000 to $10,000,000 As Art mentioned, during the Q4, we made Some additional smaller changes to the sales organization largely affecting underperforming team members. Also during the Q4, We reduced marketing campaigns for new candidates as we are benefiting from an elevated amount of activity from candidates in this weak employment environment. For the quarter, we had income tax expense of $563,000 on income before taxes of $2,700,000 Our tax rate for the quarter differed from our approximate statutory rate of 25%, due primarily to the reversal of liabilities for uncertain tax positions as federal and state statutes expired. We recorded net income of $2,100,000 or $0.05 per diluted share. Speaker 300:18:21For the prior year quarter, we reported a net income of $2,400,000 or $0.05 per diluted share. Adjusted diluted earnings per share for the quarter were 0 point 04 dollars compared to $0.01 for the prior year quarter. Diluted shares outstanding for the quarter were 44,600,000 compared to 46 $100,000 in the prior year quarter. Adjusted EBITDA for the 4th quarter increased 24% to $10,100,000 a margin of 27%, compared to $8,100,000 or a margin 20% in the 4th quarter a year ago. Operating cash flow for the 4th quarter was $7,600,000 compared to $7,300,000 in the prior year period. Speaker 300:19:12From a liquidity perspective, at the end of the quarter, we had 4 point $2,000,000 in cash and total debt of $38,000,000 under our $100,000,000 revolver. Total debt outstanding decreased $2,000,000 from $40,000,000 at the end of the 3rd quarter. We continue to target approximately one times leverage for the business. Deferred revenue at the end of the quarter was $50,000,000 down 2% from the Q4 of last year. Our total committed contract backlog at the end of the quarter was 108 $100,000 which was down 8% from the end of the 4th quarter last year. Speaker 300:19:56Short term backlog was $89,800,000 at end of the Q4, a decrease of $1,700,000 or 2% year over year. Long term backlog, status revenue to be recognized in 13 or more months was $18,300,000 at the end of the quarter, a decrease of $7,500,000 or 29% from the prior year quarter as the average length of our multi year contracts decreased. During the quarter, we did not purchase shares under our share buyback program. For the year, we repurchased 1,700,000 shares $6,900,000 under our repurchase program and repurchased 1,200,000 shares for $6,200,000 to cover income tax withholdings associated with the vesting of employee shares. As a reminder, our $10,000,000 program began in the first of 2023 and runs through February 2024. Speaker 300:20:59Of the $10,000,000 authorized, 4 point $8,000,000 remained available under the program at the end of the quarter. Moving on to guidance. While we saw signs of an improved bookings environment across all of our new business teams in the 4th quarter, We do not expect total bookings growth to return until the second half of twenty twenty four, which we expect to result in a low single digit percentage decline in our total revenue for the full year. From a profitability perspective, We are targeting a full year adjusted EBITDA margin of 24%. However, we anticipate our 1st quarter adjusted EBITDA margin will be lower due to seasonal costs that more heavily impact the Q1, such as certain payroll taxes. Speaker 300:21:50We remain focused on driving long term sustainable revenue growth and are well positioned from a customer acquisition perspective to return to growth when the economy begins its recovery and tech hiring improves. To wrap up, while the current hiring environment is impacting our growth, we expect companies across all industries to continue their investment in technology initiatives, which we believe will drive increased demand for our products and services as the economy improves. In the meantime, we are focused on improving our industry leading offerings and our go to market execution, So we are ready to capitalize on the anticipated return of tech hiring. And with that, let me turn the call back to Art. Speaker 200:22:36Thank you, Amy. I'd like to thank all of our employees again for their hard work this past year. It is an absolute pleasure to be part of such a great team. With that, we're happy to take your questions. Operator00:22:50We will now begin the question and answer session. Our first question is from Zach Cummins with B. Riley Securities. Please go ahead. Speaker 400:23:25Hi, good afternoon, Art, and welcome to Lardee. Raimi, really appreciate you taking my questions. Can you start by talking about the new business trends here, the improvement we saw across both teams in Q4? I mean, can you talk about maybe what you're seeing through the 1st month of this year and kind of how you're expecting that to progress forward just based on the guidance that you gave for 2024? Speaker 200:23:51Sure. I could tell you this, Zach, and it's great to hear your voice once again. We saw a diminishment of demand for new business in general across all of 2023. If you think about it, as we've talked about it in the past, Most CFOs have scrutinized any kind of new expense in this kind of an environment. But qualitatively, we saw a shift Because of the introduction of pricing bundles in November of last year, so that there were larger deals sold by our new business teams. Speaker 200:24:25And I would say there was a notable pickup in the amount of actual bookings activity. I wouldn't say that They anywhere came close to the levels that we saw in 2022, but there was a pickup for sure. And when you say do we see in January? We saw kind of a continuation of those trends. Again, we are being pretty cautious with the way that we've projected our performance for 2024, including the new business team bookings performance, but there was a bit of a shift in the favor of new business. Speaker 400:25:02Understood. And just digging a little bit deeper, can you talk some more about the Pricing and bundling strategy for Dice, is this really just a way to entice more customers to on board with more value or how are you going about testing different pricing and bundling packages? Speaker 200:25:20Absolutely. Great question. So for each cohort of customers and what I mean by cohort is I mean DICE commercial accounts, Dice, staffing recruiting, consulting business and also clearance jobs customers, we have a set of packages kind of in the standard bronze, silver, gold, platinum kind of product set. And those are based on the size of the company in general. So smaller companies obviously would be focused on bronze, midsize companies on silver, large on gold, so forth and so on. Speaker 200:25:57The real benefit in my opinion of these packages is that they bring together things that we think are appropriate for companies to maximize their opportunity to bring on technology professionals in this environment. It's a combination of being able to post your jobs, a number of views of profiles, the ability to have a company page set up for you that enhances your brand to the technology community and then a way of boosting jobs that you're having problems with to the top of the search order. So it's a tight package that really provides a strong value proposition to giving the recruiter the best chance to bring the right technologist to bear. Now in my opinion, one of the real transformative elements of these bundles is the fact that we no longer have job slots. We're not limiting the number of jobs that are being delivered to the Dice platform or the CJ platform by our customers. Speaker 200:27:01And that was something that we've done in the past. That's really endemic To the job board world, we are going to allow them to post all the jobs they want inclusive of that package. They have also the ability to bring additional recruiters to these packages as well. So we think it's a great bundle. We think it a lot of value. Speaker 200:27:22It gives them the maximum chance for success. And that's really what defined the bundles strategy in the first place is We saw certain customers taking certain things as a natural part of their interaction with us. We said if you take these Elements together as a package, you will have the maximum success of finding the right technology professional. And it seems to be resonating. We've already sold over 100 of these bundles and they started in mid November. Speaker 400:27:54Got it. And final question for me is just really on the churn I mean, obviously, a lot of this is still at the lower end of the market. But do you have a sense of really how much is left to shake out there at the lower end of the market, especially as we go into 2024, just curious on your thoughts around the revenue renewal rate for Dice? Speaker 200:28:14We aren't projecting a change in the churn rate or the inverse of that, which is Obviously, the revenue renewal rate in large part, and that's because we don't have any data that really substantiates a change. I do believe we've shaken the tree pretty hard of these clients, these staffing recruiting agencies that are smaller ones that are more susceptible to a lower demand environment. If you think about it, the number of tech job postings declined over the course of the year as we indicated. Well, it's those smaller tech firms that staffing recruiting firms that suffer the most when the job demand environment recedes like it has. It means that they don't have the orders that they had in the previous year. Speaker 200:29:01So again, we don't know if we've shaken the tree to the point where all we have is stable, Staffing recruiting firms that can weather any storm or the current storm, but our forecast, I could tell you, our budget does not presume any difference in renewal rates for the remainder of the year. Speaker 400:29:22Understood. Well, thanks for taking my questions and best of luck with the rest of the quarter. Speaker 200:29:26Thank you very much, Zach. Really appreciate it. Operator00:29:30The next question is from Max Michalis with Lake Street Capital Markets. Please go ahead. Speaker 500:29:36Hey guys, thanks for taking my question. First one just on bookings here. So if we're projecting growth in the second half of the year for bookings. I'm assuming that that's implying Dice and Clearance jobs are both growing. I was wondering if you could point to any Other areas of confidence you're seeing just to see Dice return to growth in the back half of the year? Speaker 300:30:02Sure. I can take that one. You're right. We are anticipating bookings growth in the second half of the year with both brands and I think the biggest factor for Dice is the quality of our renewable book. If you think about year on year comparison, we'll improve. Speaker 300:30:23So, as Art just talked about, the Customers who have turned in mid-twenty 23 that comparable in terms of the renewable book helps us just as we stabilize in the second half of twenty twenty four. Speaker 500:30:44Got it. And then when we look at your cost structure, I know you guys took the initiative last year, But going for and also in Q4 as well, but are you guys at this where you guys are at right now, are you comfortable where are at in terms of cost structure, do you see anything else any other actions need to be taken in 2024? Speaker 200:31:05So I can tell you that we feel very confident about our team and the organization that we have in place. I cannot foresee any kind of a change in terms of the team structure or the way that we operate. There are expenses that are discretionary to the degree that we see certain trends in the environment. We spoke to one of those, which is marketing spend on candidate activity. If you think about it, candidates in this environment are A little bit wary about where they stand with regard to their job prospects. Speaker 200:31:39And so they're coming to the Dice and CJ sites naturally without a lot of marketing spend. We cut back on spend in the Q4 because we saw that distinct trend. If we continue to see that trend, we can vary the amount of marketing spend on, again, candidate activity. We're very, loathe to change the client facing marketing spend because we realize that that's so incredibly important to our bookings and ultimately our revenue performance. So again, we can change that candidate spend kind of real time as we assess that trend in the marketplace. Speaker 200:32:19We do not presume that in our budget. Again, our budget is and has hopefully been conservative to the degree that we have been able to forecast various trends that we see. But that's the one area that I can foresee making changes real time to affect our expense structure, but again, not in terms of the population of our team or the team structure itself. Speaker 500:32:45All right, thanks. And then last one for me. So if we think about tech in 2024 and the uncertainty around it, Is there any other areas in the market maybe outside of tech, maybe M and A opportunities that you guys have spotted that you guys can go after? Speaker 200:33:01I would say no. We haven't really seen anything meaningful that has been actionable in terms of an acquisition. I would say that given the share price today and the fact that we have divested a number of previous acquisitions, I that there's a pretty high bar that's imposed by our investors as to a strategy around acquisitions that would make sense for us long term. That's not to say that we rule it out entirely, but we just think that there's a high bar and we really haven't found anything that's actionable at least right now. Speaker 500:33:38Yes. And then I guess outside of M and A, is there any other areas you think you potentially invest in maybe if we just leave out M and A and you guys solely enter a market on your own? Speaker 200:33:48Well, I would say There are some interesting additions that we're making to the product line. I spoke to one of them, which is called programmatic. It's the ability to take a job feed from advertising agencies and allow them to have a price that's not based on a subscription, but based on the number of views they see of their job postings or the number of applies that they receive. And that is a brand new revenue lever. It's very nascent for us. Speaker 200:34:19We're going to be investing in that and making it more sophisticated over the course of the year, bringing on more agencies. But I don't want to overplay its importance. We're by definition or by our nature, very conservative. So that's an area that I'm very intrigued with because it's still it has a good revenue potential for the future. There are clients that naturally gravitate towards this transactional model for facilitating their hiring of technology professionals. Speaker 200:34:51That's the one that I would say is notable. All right, guys. Thanks for taking my questions. Thank you. We appreciate it, Max. Operator00:35:05The next question is from Kevin Liu with K. Liu and Company. Please go ahead. Speaker 600:35:10Hi, good afternoon. First thing I wanted to ask about was just from a bookings perspective. Obviously, you saw some improvement here in the Q4. And in terms of getting to kind of that positive bookings growth in the back half Is it fair to assume that maybe the trough in terms of the level of decline is behind you and we should just kind of see steady improvement in that bookings growth rate? Are there periods expected in the first half where you could continue to see maybe some more incremental softness? Speaker 300:35:38Hi, Kevin. Yes, I think it is fair to assume that we anticipate an improvement in bookings quarter on quarter. So as you know, in Q4, the decline in bookings year on year for Dice was narrower and smaller than it was in Q3 and we expect again that quarter on quarter improvement in bookings comparables for Dice and obviously CJ continues to grow year on year. So Not sure if we've hit the trough yet, but we do expect that the booking comparables to continue to improve based on what we see in the market at this point. Speaker 600:36:24That's great to hear. And then, Art, going back to some of your comments on kind of the marketing spend and levers you're able to pull there. I'm just wondering, are you at a level exiting Q4 where this is you kind of want to start off in Q1 here or is there opportunity to actually take marketing spend down further at the beginning of the year and then maybe build back up as the environment Speaker 200:36:48Actually the opposite. We would naturally spend more on candidate spend at the beginning of the year. And the theory is that there's 2 effects. I spoke to the fact that we're naturally seeing candidates come to our site. But in the 4th quarter, The seasonality effect of having the holidays at the back half of November December naturally means a lower amount of spend for us in any traditional year. Speaker 200:37:16So again, we would actually kind of reload the marketing spend for a much Larger amount of candidate activity in the Q1 than in the Q4 in any year, but particularly because of this effect of candidates that are coming to our site because they're worried about their job prospects. Speaker 600:37:40Got it. That's helpful. And then just lastly, with respect to the bundled packages, I know it's still fairly early days here, But would be curious what sort of uplift you're seeing in terms of the recruitment package price per customer relative to what we've seen historically? Speaker 200:37:57That's great question. I'll tell you that we know that if a customer takes a bundle as part of our CA new business activity that the average or the annual contract value for that bundle is roughly twice the value of the packages that they would take without the bundle. And that's kind of the magic of the bundle itself is that it comes with a number of different features built into it. So you're getting a lot more for your money, but you have to pay something more than you would pay kind of as a natural transaction with us. So again, we're seeing 100 percent lift for Dice commercial accounts when a bundle is sold versus when a bundle is not sold. Speaker 200:38:42It's not that big of a lift for Dice SRC. It's approximately in kind of the 20% range. And then for CJ, it's still kind of new days. I think there's a lift, but we're we didn't see as many sales for CJ. So we're still studying that. Speaker 200:39:00But what we're seeing is that each category of new business sale that does involve a bundle involves a lift compared to A non bundled sale. Speaker 600:39:13Got it. And sorry, I didn't mean to interrupt. But just for those bundled sales that you're seeing today, is that primarily on kind of the new business front or have you actually seen good traction with customers maybe going through the renewal cycle And willing to upgrade to these bundles? Speaker 200:39:31I would say it has been predominantly a focus for the new business teams, Less so for account management, but it's we are still seeing positive progress on account management as well, those teams that are renewing customers. Operator00:39:51This concludes our question and answer session. Would like to turn the conference back over to Art Zayle for any closing remarks. Speaker 200:39:59Thank you. I just want to let everybody know that I'm really appreciative that You came to our conference call today. As always, if you have any questions about our company or would like to speak with the management team, Please reach out to Todd, and he will help arrange a meeting. Thanks, everyone, for your interest in DHI Group, and have yourself a great day.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallDHI Group Q4 202300:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Annual report(10-K) DHI Group Earnings HeadlinesD.R. Horton's Undervaluation May Trigger Rich Upside Once Macro Headwinds EaseMay 7 at 9:09 AM | seekingalpha.com2DHX : Examining the Future: DHI Group's Earnings OutlookMay 6 at 6:59 PM | benzinga.comWatch This Robotics Demo Before July 23rdJeff Brown, the tech legend who picked shares of Nvidia in 2016 before they jumped by more than 22,000%... Just did a demo of what Nvidia’s CEO said will be "the first multitrillion-dollar robotics industry."May 7, 2025 | Brownstone Research (Ad)DHI Group, Inc. to Report First Quarter 2025 Financial Results on May 7, 2025April 24, 2025 | businesswire.comDHI GROUP SHAREHOLDER ALERT: Kaskela Law LLC Announces Investigation of DHI Group, Inc. (NYSE: DHX) and Encourages Long-Term Investors to Contact the FirmApril 7, 2025 | globenewswire.comDHI Group, Inc. to Present at the Planet MicroCap Showcase: VEGAS in partnership with MicroCapClub on Wednesday, April 23, 2025 & 1x1 Meetings on Thursday, April 24, 2025March 31, 2025 | businesswire.comSee More DHI Group Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like DHI Group? Sign up for Earnings360's daily newsletter to receive timely earnings updates on DHI Group and other key companies, straight to your email. Email Address About DHI GroupDHI Group (NYSE:DHX) provides data, insights, and employment connections through specialized services for technology professionals and other select online communities in the United States. Its solutions include talent profiles; job postings; employer branding; and other services comprising virtual and live career events, sourcing services, and content and data services that provides tailored content to help professionals manage their careers and provide employers insight into recruiting strategies and trends. The company operates Dice that offers job postings of technology and non-technology companies for industries, such as positions for software engineers, big data professionals, systems administrators, database specialists, project managers, and various other technology and engineering professionals; and ClearanceJobs, an online career community, which matches security-cleared professionals with employers in a secure and private environment to fill the jobs that safeguard its nation. It serves small, mid-sized, and large direct employers; staffing companies; recruiting agencies; staffing and consulting firms; and marketing departments of companies, as well as direct hiring companies. The company offers its products and services primarily through its direct sales force and agency partner channel. The company was formerly known as Dice Holdings, Inc. and changed its name to DHI Group, Inc. in April 2015. DHI Group, Inc. was founded in 1990 and is headquartered in Centennial, Colorado.View DHI Group ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Archer Stock Eyes Q1 Earnings After UAE UpdatesFord Motor Stock Rises After Earnings, But Momentum May Not Last Broadcom Stock Gets a Lift on Hyperscaler Earnings & CapEx BoostPalantir Stock Drops Despite Stellar Earnings: What's Next?Is Eli Lilly a Buy After Weak Earnings and CVS-Novo Partnership?Is Reddit Stock a Buy, Sell, or Hold After Earnings Release?Warning or Opportunity After Super Micro Computer's Earnings Upcoming Earnings Monster Beverage (5/8/2025)Coinbase Global (5/8/2025)Brookfield (5/8/2025)Anheuser-Busch InBev SA/NV (5/8/2025)ConocoPhillips (5/8/2025)Shopify (5/8/2025)Cheniere Energy (5/8/2025)McKesson (5/8/2025)Enbridge (5/9/2025)Petróleo Brasileiro S.A. - Petrobras (5/12/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. 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There are 7 speakers on the call. Operator00:00:00Good afternoon, and welcome to the DHI Group 4th Quarter and Full Year 2023 Financial Results Conference Call. All participants will be in listen only mode. Please note, this event is being recorded. I would now like to turn the conference over to Todd Kehrli of MKR Investor Relations. Please go ahead. Speaker 100:00:43Thank you, operator. Good afternoon, and welcome to DHI Group's 2023 4th Quarter and Full Year Earnings Conference Call. With me on today's call are DHI's CEO, Art Zeile and Rainey Levy, DHI's CFO. Before I turn the call over to Art and Ramey, I'd like to cover a few quick items. This afternoon, DHI issued a press release announcing its 2023 4th Quarter and Full Year Financial Results. Speaker 100:01:09The release is available on the company's website at dhigroupinc.com. This call is being broadcast live over the Internet for all interested parties and the webcast will be archived on the Investor Relations page of the company's website. I want to remind everyone that during today's call, management will make forward looking statements that involve risks and uncertainties. Please note that except for historical information, statements on today's call may constitute forward looking statements within the meaning of federal securities laws. These forward looking statements reflect DHI Management's current views concerning future events and financial performance and are subject to risks and uncertainties, and actual results may differ materially from the outcomes contained in any forward looking statements. Speaker 100:01:56Factors that could cause these forward looking statements to differ from actual results include the risks and uncertainties discussed and the company's periodic reports on Form 10 ks and 10 Q and other filings with the Securities and Exchange Commission. DHI undertakes no obligation to update or revise any forward looking statements. Lastly, during today's call, management will be referring to financial measures, including adjusted EBITDA, adjusted EBITDA margin and adjusted diluted earnings per share, which are not prepared in accordance with U. S. GAAP. Speaker 100:02:31Information about and reconciliations of these non GAAP measures to the most directly comparable GAAP measures are available in our earnings release, a copy of which you can find on our website at dhigroupinc.com in the Investor Relations section. With that, I'll now turn the call over to Art Zayle, CEO of DHI Group. Art? Speaker 200:02:54Thank you, Todd. Good afternoon, everyone, and welcome to our 2023 4th quarter and full year earnings conference call. We appreciate your time today as we discuss our financial performance for 2023 and our future outlook. First, let's discuss the state of the tech labor market. There is no doubt that 2023 was a challenging year for tech hiring. Speaker 200:03:19Over 260,000 tech workers were laid off in 2023 compared to 165,000 in 2022. And based on monthly BLS data, the U. S. Tech population only increased by 78,000 workers in 2023 versus $486,000 in 2022. This coincided with a decline in actual tech job postings throughout the year, where monthly job postings averaged approximately 220,000 in 2023 compared to 390,000 in 2022, a drop of over 40%. Speaker 200:03:58We attribute much of the decline in tech hiring in 2023 to a recalibration From the massive hiring that occurred in 2021 2022 coming out of the pandemic, along with caution exercised by companies in a very uncertain environment. Looking ahead, customer sentiment remains very cautious, With most economists forecasting a slowdown in GDP growth in 2024 to a rate between 1% 2%. Having said that, we believe the backlog of desired tech investments continues to grow inside enterprises And we expect these important technology initiatives will be high priorities once the macro uncertainties begin to clear, which in turn will drive demand for our hiring platforms. Despite all of this uncertainty and its knock on consequences, We continue to operate effectively and efficiently as evidenced by our ability to grow our revenue in 2023 as well as expand our profitability. While we wait for commercial tech hiring to return, we have started to see our ClearanceJobs bookings strengthen after the signing of the National Defense Authorization Act in mid December, which provides for a 3% increase in defense spending compared to fiscal year 2022. Speaker 200:05:19This is a big positive for CJ, although the possibility of a government shutdown still creates a tougher sales environment for us. Given that Dice represents approximately 2 thirds of our aggregate revenue, the question remains when we will see tech hiring start to increase back to a normalized level. We believe that this is a matter of when, not if it will do so. As I've mentioned before, McKinsey Global Institute believes jobs will grow at a rate of 23% from 2022 to 2,030 because of the continued digitization of our economy and the implementation of AI. This theme is consistent with KPMJ's Annual CEO survey released just a couple of weeks ago, which stated that 72% of U. Speaker 200:06:10S. CEOs say that generative AI is a top investment priority. All of this data supports the long term Secular trend of tech hiring and gives us confidence that once businesses have a collective sense of confidence in our economy, They will accelerate their investment in technology initiatives and will need our platforms and our 8,000,000 candidate profiles to find, attract and hire the best tech professionals for their job postings. While we wait for the overall tech hiring environment to improve, We continue to focus on what we can control, including improving our industry leading product offerings and our go to market engine. Now let me dig into our performance during the quarter and what we see ahead for 2024. Speaker 200:06:59In the 4th quarter, our total revenue declined 6 percent year over year. Dice revenue for the quarter decreased 13% year over year, while CJ revenue increased 9%. The decrease in Dice revenue was the result of lower new business bookings and renewals over the past several quarters, as well as continued lower one time transactional revenue, all of which are a reflection of the uncertain economic environment I have described. Having said that, excluding transactional revenue, our total recurring revenue was up 2% year over year in the Q4 across the two platforms and for the full year our total recurring revenue was up 9% year over year. Looking at our bookings performance, while our total bookings were down 4% for both the 4th quarter and the full year, Our bookings for our recurring revenue products were up 1% for the quarter and 3% for the full year. Speaker 200:08:02Dice secured several new clients this quarter, including Tech Systems, Ciena Corporation and Infosys, As we remain focused on those industries and specific companies that are hiring tech professionals even in today's weakened economic environment. Those industries include aerospace, business consulting, healthcare, financial services and education. While Dice new business teams continue to see more intense deal scrutiny in this difficult macro environment, we saw a meaningful improvement in our new business team bookings from the 3rd to 4th quarter, including for our Dice Commercial Accounts team. ClearanceJobs bookings for the 4th quarter increased 15% year over year, despite the uncertainty caused by a potential government shutdown. CJ secured several new clients this quarter including Sierra Space, Omitron and Henckels and McCoy. Speaker 200:09:01As I mentioned earlier, the most recent National Defense Authorization Act provides for a 3% increase in spending. It was signed midway through December and has started to positively impact the demand for cleared tech professionals. As a result, we expect increased bookings and revenue growth for CJ in 2024. Moving on to account management, our Dice and CJ revenue renewal rates were 78% 96 percent respectively in the 4th quarter. Retention rates for Dice and CJ were 97% 110% respectively. Speaker 200:09:42While we continue to see customer attrition for Dice, it continues to be concentrated with smaller clients that have been more impacted by the macroeconomic environment than our larger accounts. These smaller accounts typically spend less than $10,000 a year with us. During the Q4, we delivered a 27% adjusted EBITDA margin, which was up significantly from 20% a year ago. In the Q4, we saw the full benefit of the organizational restructuring we announced last year, which included a 10% reduction in workforce that streamlined our team structure and improved our operating margins. During the Q4, we made some additional smaller changes to the sales organization, largely affecting underperforming team members. Speaker 200:10:31We also reduced marketing campaigns for new candidates as we benefited from an elevated amount of candidate activity in this weak employment environment. For 2024, we will continue to focus on operating our business efficiently and are targeting a full year adjusted EBITDA margin of 24%. During the quarter, We continue to strengthen our industry leading product offerings. Dice delivered an improved company search function for candidates as well as SMS notifications. Dice also introduced programmatic listings, which allow job advertising agencies to digitally feed job opportunities into the Dice platform and pay only for candidate job views and applies, consistent with contracts they have signed with their underlying clients. Speaker 200:11:24We also tested new pricing bundles that combined unlimited job postings, a company page and selected job boosts for harder to fill positions. We believe these bundles have the potential to increase new customer annual contract value and improve our existing customer retention rates. The initial results were positive and we are continuing to test this new pricing model. ClearanceJobs continue to develop CJ Live during the quarter. CJ Live will enable employers to create and deliver video based content to boost candidate engagement. Speaker 200:12:04In summary, while the difficult economic environment has had a temporary impact on our total revenue growth rate, Our recurring revenue continued to grow in the 4th quarter and for the full year. We believe there remains a long term secular trend for adding more tech workers in the U. S. And as the economic uncertainty recedes and as companies across all industries continue their investment in technology initiatives, we expect increased demand for our tools that enable companies to attract, find and hire the right tech professionals for their open positions. Until then, we will continue to focus on improving our products and our go to market execution, so that we are ready to capitalize on this anticipated increased demand for our tools, while doing so in a more efficient and profitable manner. Speaker 200:12:57Lastly, on our past earnings call, we announced the addition of Ramey Leebie as our new Chief Financial Officer. What impressed us most about Ramey is our virtual skill set, including direct responsibility for F and A, Financial Operations, Tax, Treasury and M and A functions, but also the multitude of times in her career where she saw Tough business challenges by taking on additional responsibilities in operations, sales and strategy roles. Rami started with us early in December and has hit the ground running and is doing a great job. On that note, let me turn the call over to Rami, We'll take you through our financials and our guidance and then we'll take any questions you may have. Raimi? Speaker 300:13:47Thank you, Art, and good afternoon, everyone. Before I begin, I would like to say that I am very excited to join the amazing team at DHI Group. It is great to join an enterprise that is a leader in its space and has a significant value proposition with its industry leading product offerings. While I have only been here a couple of months, I can tell you it has been a pleasure to work with Art, our Board of Directors and the terrific DHI team. I can't wait to help the team continue growing this business and I look forward to getting to better know our shareholders and the analysts that cover DHI. Speaker 300:14:25Now let me take you through our financial results for the quarter. We reported total revenue of $37,300,000 which was down 6% a year over year basis and essentially flat versus the prior quarter. Total bookings for the quarter were $36,100,000 down 4% year over year. As Art mentioned, our total recurring revenue was up 2% for the 4th quarter and 9% for the full year and the bookings that drive our recurring revenue were up 1% for the 4th quarter and 3% for the full year. Dice revenue was $24,600,000 which was down 13% year over year and down 1% sequentially. Speaker 300:15:10DICE bookings were $22,200,000 down 14% year over year. We ended the quarter with 5,492 DICE recruitment package customers, which is down 5% from last quarter and down 13% year over year. Our average annual revenue per Dice recruitment package customer was up 2% sequentially and up 3% year over year to $15,780 Approximately 90% of Dice revenue is and comes from annual or multi year contracts. For the quarter, our Dice revenue renewal rate was 78% and our retention rate was 97%. Clearance jobs revenue was $12,700,000 up 9% year over year and flat sequentially. Speaker 300:16:04Bookings for CJ were $13,900,000 up 15% year over year. We ended the 4th quarter with 2,055 CJ recruitment package customers, which was flat on both the sequential and year over year basis. Our average annual revenue per CJ recruitment customer was up 10% year over year and up 2% sequentially to $21,872 Approximately 90% of CJ revenue is recurring and comes from annual or multi year contracts. For the quarter, CJ's revenue renewal rate was up sequentially to 96% and CJ's retention rate was strong at 110%. The outstanding retention rate demonstrates the continued value CJ delivers in the recruitment of cleared professionals. Speaker 300:16:59Turning to operating expenses, 4th quarter operating expenses were down 13% to $33,800,000 when compared to $39,000,000 in the year ago quarter. As with the 3rd quarter, our 4th quarter operating expenses reflect a full quarter of the cost savings associated with the May restructuring, which is expected to generate annual cost of approximately $8,000,000 to $10,000,000 As Art mentioned, during the Q4, we made Some additional smaller changes to the sales organization largely affecting underperforming team members. Also during the Q4, We reduced marketing campaigns for new candidates as we are benefiting from an elevated amount of activity from candidates in this weak employment environment. For the quarter, we had income tax expense of $563,000 on income before taxes of $2,700,000 Our tax rate for the quarter differed from our approximate statutory rate of 25%, due primarily to the reversal of liabilities for uncertain tax positions as federal and state statutes expired. We recorded net income of $2,100,000 or $0.05 per diluted share. Speaker 300:18:21For the prior year quarter, we reported a net income of $2,400,000 or $0.05 per diluted share. Adjusted diluted earnings per share for the quarter were 0 point 04 dollars compared to $0.01 for the prior year quarter. Diluted shares outstanding for the quarter were 44,600,000 compared to 46 $100,000 in the prior year quarter. Adjusted EBITDA for the 4th quarter increased 24% to $10,100,000 a margin of 27%, compared to $8,100,000 or a margin 20% in the 4th quarter a year ago. Operating cash flow for the 4th quarter was $7,600,000 compared to $7,300,000 in the prior year period. Speaker 300:19:12From a liquidity perspective, at the end of the quarter, we had 4 point $2,000,000 in cash and total debt of $38,000,000 under our $100,000,000 revolver. Total debt outstanding decreased $2,000,000 from $40,000,000 at the end of the 3rd quarter. We continue to target approximately one times leverage for the business. Deferred revenue at the end of the quarter was $50,000,000 down 2% from the Q4 of last year. Our total committed contract backlog at the end of the quarter was 108 $100,000 which was down 8% from the end of the 4th quarter last year. Speaker 300:19:56Short term backlog was $89,800,000 at end of the Q4, a decrease of $1,700,000 or 2% year over year. Long term backlog, status revenue to be recognized in 13 or more months was $18,300,000 at the end of the quarter, a decrease of $7,500,000 or 29% from the prior year quarter as the average length of our multi year contracts decreased. During the quarter, we did not purchase shares under our share buyback program. For the year, we repurchased 1,700,000 shares $6,900,000 under our repurchase program and repurchased 1,200,000 shares for $6,200,000 to cover income tax withholdings associated with the vesting of employee shares. As a reminder, our $10,000,000 program began in the first of 2023 and runs through February 2024. Speaker 300:20:59Of the $10,000,000 authorized, 4 point $8,000,000 remained available under the program at the end of the quarter. Moving on to guidance. While we saw signs of an improved bookings environment across all of our new business teams in the 4th quarter, We do not expect total bookings growth to return until the second half of twenty twenty four, which we expect to result in a low single digit percentage decline in our total revenue for the full year. From a profitability perspective, We are targeting a full year adjusted EBITDA margin of 24%. However, we anticipate our 1st quarter adjusted EBITDA margin will be lower due to seasonal costs that more heavily impact the Q1, such as certain payroll taxes. Speaker 300:21:50We remain focused on driving long term sustainable revenue growth and are well positioned from a customer acquisition perspective to return to growth when the economy begins its recovery and tech hiring improves. To wrap up, while the current hiring environment is impacting our growth, we expect companies across all industries to continue their investment in technology initiatives, which we believe will drive increased demand for our products and services as the economy improves. In the meantime, we are focused on improving our industry leading offerings and our go to market execution, So we are ready to capitalize on the anticipated return of tech hiring. And with that, let me turn the call back to Art. Speaker 200:22:36Thank you, Amy. I'd like to thank all of our employees again for their hard work this past year. It is an absolute pleasure to be part of such a great team. With that, we're happy to take your questions. Operator00:22:50We will now begin the question and answer session. Our first question is from Zach Cummins with B. Riley Securities. Please go ahead. Speaker 400:23:25Hi, good afternoon, Art, and welcome to Lardee. Raimi, really appreciate you taking my questions. Can you start by talking about the new business trends here, the improvement we saw across both teams in Q4? I mean, can you talk about maybe what you're seeing through the 1st month of this year and kind of how you're expecting that to progress forward just based on the guidance that you gave for 2024? Speaker 200:23:51Sure. I could tell you this, Zach, and it's great to hear your voice once again. We saw a diminishment of demand for new business in general across all of 2023. If you think about it, as we've talked about it in the past, Most CFOs have scrutinized any kind of new expense in this kind of an environment. But qualitatively, we saw a shift Because of the introduction of pricing bundles in November of last year, so that there were larger deals sold by our new business teams. Speaker 200:24:25And I would say there was a notable pickup in the amount of actual bookings activity. I wouldn't say that They anywhere came close to the levels that we saw in 2022, but there was a pickup for sure. And when you say do we see in January? We saw kind of a continuation of those trends. Again, we are being pretty cautious with the way that we've projected our performance for 2024, including the new business team bookings performance, but there was a bit of a shift in the favor of new business. Speaker 400:25:02Understood. And just digging a little bit deeper, can you talk some more about the Pricing and bundling strategy for Dice, is this really just a way to entice more customers to on board with more value or how are you going about testing different pricing and bundling packages? Speaker 200:25:20Absolutely. Great question. So for each cohort of customers and what I mean by cohort is I mean DICE commercial accounts, Dice, staffing recruiting, consulting business and also clearance jobs customers, we have a set of packages kind of in the standard bronze, silver, gold, platinum kind of product set. And those are based on the size of the company in general. So smaller companies obviously would be focused on bronze, midsize companies on silver, large on gold, so forth and so on. Speaker 200:25:57The real benefit in my opinion of these packages is that they bring together things that we think are appropriate for companies to maximize their opportunity to bring on technology professionals in this environment. It's a combination of being able to post your jobs, a number of views of profiles, the ability to have a company page set up for you that enhances your brand to the technology community and then a way of boosting jobs that you're having problems with to the top of the search order. So it's a tight package that really provides a strong value proposition to giving the recruiter the best chance to bring the right technologist to bear. Now in my opinion, one of the real transformative elements of these bundles is the fact that we no longer have job slots. We're not limiting the number of jobs that are being delivered to the Dice platform or the CJ platform by our customers. Speaker 200:27:01And that was something that we've done in the past. That's really endemic To the job board world, we are going to allow them to post all the jobs they want inclusive of that package. They have also the ability to bring additional recruiters to these packages as well. So we think it's a great bundle. We think it a lot of value. Speaker 200:27:22It gives them the maximum chance for success. And that's really what defined the bundles strategy in the first place is We saw certain customers taking certain things as a natural part of their interaction with us. We said if you take these Elements together as a package, you will have the maximum success of finding the right technology professional. And it seems to be resonating. We've already sold over 100 of these bundles and they started in mid November. Speaker 400:27:54Got it. And final question for me is just really on the churn I mean, obviously, a lot of this is still at the lower end of the market. But do you have a sense of really how much is left to shake out there at the lower end of the market, especially as we go into 2024, just curious on your thoughts around the revenue renewal rate for Dice? Speaker 200:28:14We aren't projecting a change in the churn rate or the inverse of that, which is Obviously, the revenue renewal rate in large part, and that's because we don't have any data that really substantiates a change. I do believe we've shaken the tree pretty hard of these clients, these staffing recruiting agencies that are smaller ones that are more susceptible to a lower demand environment. If you think about it, the number of tech job postings declined over the course of the year as we indicated. Well, it's those smaller tech firms that staffing recruiting firms that suffer the most when the job demand environment recedes like it has. It means that they don't have the orders that they had in the previous year. Speaker 200:29:01So again, we don't know if we've shaken the tree to the point where all we have is stable, Staffing recruiting firms that can weather any storm or the current storm, but our forecast, I could tell you, our budget does not presume any difference in renewal rates for the remainder of the year. Speaker 400:29:22Understood. Well, thanks for taking my questions and best of luck with the rest of the quarter. Speaker 200:29:26Thank you very much, Zach. Really appreciate it. Operator00:29:30The next question is from Max Michalis with Lake Street Capital Markets. Please go ahead. Speaker 500:29:36Hey guys, thanks for taking my question. First one just on bookings here. So if we're projecting growth in the second half of the year for bookings. I'm assuming that that's implying Dice and Clearance jobs are both growing. I was wondering if you could point to any Other areas of confidence you're seeing just to see Dice return to growth in the back half of the year? Speaker 300:30:02Sure. I can take that one. You're right. We are anticipating bookings growth in the second half of the year with both brands and I think the biggest factor for Dice is the quality of our renewable book. If you think about year on year comparison, we'll improve. Speaker 300:30:23So, as Art just talked about, the Customers who have turned in mid-twenty 23 that comparable in terms of the renewable book helps us just as we stabilize in the second half of twenty twenty four. Speaker 500:30:44Got it. And then when we look at your cost structure, I know you guys took the initiative last year, But going for and also in Q4 as well, but are you guys at this where you guys are at right now, are you comfortable where are at in terms of cost structure, do you see anything else any other actions need to be taken in 2024? Speaker 200:31:05So I can tell you that we feel very confident about our team and the organization that we have in place. I cannot foresee any kind of a change in terms of the team structure or the way that we operate. There are expenses that are discretionary to the degree that we see certain trends in the environment. We spoke to one of those, which is marketing spend on candidate activity. If you think about it, candidates in this environment are A little bit wary about where they stand with regard to their job prospects. Speaker 200:31:39And so they're coming to the Dice and CJ sites naturally without a lot of marketing spend. We cut back on spend in the Q4 because we saw that distinct trend. If we continue to see that trend, we can vary the amount of marketing spend on, again, candidate activity. We're very, loathe to change the client facing marketing spend because we realize that that's so incredibly important to our bookings and ultimately our revenue performance. So again, we can change that candidate spend kind of real time as we assess that trend in the marketplace. Speaker 200:32:19We do not presume that in our budget. Again, our budget is and has hopefully been conservative to the degree that we have been able to forecast various trends that we see. But that's the one area that I can foresee making changes real time to affect our expense structure, but again, not in terms of the population of our team or the team structure itself. Speaker 500:32:45All right, thanks. And then last one for me. So if we think about tech in 2024 and the uncertainty around it, Is there any other areas in the market maybe outside of tech, maybe M and A opportunities that you guys have spotted that you guys can go after? Speaker 200:33:01I would say no. We haven't really seen anything meaningful that has been actionable in terms of an acquisition. I would say that given the share price today and the fact that we have divested a number of previous acquisitions, I that there's a pretty high bar that's imposed by our investors as to a strategy around acquisitions that would make sense for us long term. That's not to say that we rule it out entirely, but we just think that there's a high bar and we really haven't found anything that's actionable at least right now. Speaker 500:33:38Yes. And then I guess outside of M and A, is there any other areas you think you potentially invest in maybe if we just leave out M and A and you guys solely enter a market on your own? Speaker 200:33:48Well, I would say There are some interesting additions that we're making to the product line. I spoke to one of them, which is called programmatic. It's the ability to take a job feed from advertising agencies and allow them to have a price that's not based on a subscription, but based on the number of views they see of their job postings or the number of applies that they receive. And that is a brand new revenue lever. It's very nascent for us. Speaker 200:34:19We're going to be investing in that and making it more sophisticated over the course of the year, bringing on more agencies. But I don't want to overplay its importance. We're by definition or by our nature, very conservative. So that's an area that I'm very intrigued with because it's still it has a good revenue potential for the future. There are clients that naturally gravitate towards this transactional model for facilitating their hiring of technology professionals. Speaker 200:34:51That's the one that I would say is notable. All right, guys. Thanks for taking my questions. Thank you. We appreciate it, Max. Operator00:35:05The next question is from Kevin Liu with K. Liu and Company. Please go ahead. Speaker 600:35:10Hi, good afternoon. First thing I wanted to ask about was just from a bookings perspective. Obviously, you saw some improvement here in the Q4. And in terms of getting to kind of that positive bookings growth in the back half Is it fair to assume that maybe the trough in terms of the level of decline is behind you and we should just kind of see steady improvement in that bookings growth rate? Are there periods expected in the first half where you could continue to see maybe some more incremental softness? Speaker 300:35:38Hi, Kevin. Yes, I think it is fair to assume that we anticipate an improvement in bookings quarter on quarter. So as you know, in Q4, the decline in bookings year on year for Dice was narrower and smaller than it was in Q3 and we expect again that quarter on quarter improvement in bookings comparables for Dice and obviously CJ continues to grow year on year. So Not sure if we've hit the trough yet, but we do expect that the booking comparables to continue to improve based on what we see in the market at this point. Speaker 600:36:24That's great to hear. And then, Art, going back to some of your comments on kind of the marketing spend and levers you're able to pull there. I'm just wondering, are you at a level exiting Q4 where this is you kind of want to start off in Q1 here or is there opportunity to actually take marketing spend down further at the beginning of the year and then maybe build back up as the environment Speaker 200:36:48Actually the opposite. We would naturally spend more on candidate spend at the beginning of the year. And the theory is that there's 2 effects. I spoke to the fact that we're naturally seeing candidates come to our site. But in the 4th quarter, The seasonality effect of having the holidays at the back half of November December naturally means a lower amount of spend for us in any traditional year. Speaker 200:37:16So again, we would actually kind of reload the marketing spend for a much Larger amount of candidate activity in the Q1 than in the Q4 in any year, but particularly because of this effect of candidates that are coming to our site because they're worried about their job prospects. Speaker 600:37:40Got it. That's helpful. And then just lastly, with respect to the bundled packages, I know it's still fairly early days here, But would be curious what sort of uplift you're seeing in terms of the recruitment package price per customer relative to what we've seen historically? Speaker 200:37:57That's great question. I'll tell you that we know that if a customer takes a bundle as part of our CA new business activity that the average or the annual contract value for that bundle is roughly twice the value of the packages that they would take without the bundle. And that's kind of the magic of the bundle itself is that it comes with a number of different features built into it. So you're getting a lot more for your money, but you have to pay something more than you would pay kind of as a natural transaction with us. So again, we're seeing 100 percent lift for Dice commercial accounts when a bundle is sold versus when a bundle is not sold. Speaker 200:38:42It's not that big of a lift for Dice SRC. It's approximately in kind of the 20% range. And then for CJ, it's still kind of new days. I think there's a lift, but we're we didn't see as many sales for CJ. So we're still studying that. Speaker 200:39:00But what we're seeing is that each category of new business sale that does involve a bundle involves a lift compared to A non bundled sale. Speaker 600:39:13Got it. And sorry, I didn't mean to interrupt. But just for those bundled sales that you're seeing today, is that primarily on kind of the new business front or have you actually seen good traction with customers maybe going through the renewal cycle And willing to upgrade to these bundles? Speaker 200:39:31I would say it has been predominantly a focus for the new business teams, Less so for account management, but it's we are still seeing positive progress on account management as well, those teams that are renewing customers. Operator00:39:51This concludes our question and answer session. Would like to turn the conference back over to Art Zayle for any closing remarks. Speaker 200:39:59Thank you. I just want to let everybody know that I'm really appreciative that You came to our conference call today. As always, if you have any questions about our company or would like to speak with the management team, Please reach out to Todd, and he will help arrange a meeting. Thanks, everyone, for your interest in DHI Group, and have yourself a great day.Read morePowered by