Gloo Q1 2027 Earnings Call Transcript

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Provided by Quartr
June 8, 2026

Key Takeaways

  • Positive Sentiment: Gloo beat Q1 expectations, reporting revenue of $41.5 million, up 238% year over year and 13% above guidance/consensus, while adjusted EBITDA of negative $11.5 million also beat expectations and improved more than $7 million sequentially.
  • Positive Sentiment: Management raised full-year 2026 revenue guidance by $5 million to $195 million and said adjusted EBITDA is still expected to approach breakeven in Q3 and turn profitable in Q4 2026.
  • Positive Sentiment: The company highlighted strong demand for its Powering Tech and Powering Reach offerings, including five new customers with more than $1 million in annual contract revenue and especially strong performance from Masterworks, Barna, and Westfall.
  • Positive Sentiment: Gloo continued to emphasize its AI strategy, noting the general availability of Gloo AI Studio, support for 80+ LLM models, and growing developer adoption, with more than 1,000 developers now on the platform.
  • Neutral Sentiment: The company added to its acquisition-led growth plan by closing EMD at the start of Q2 and taking full ownership of Midwestern, which it said should expand capabilities and remove a $12.1 million liability tied to a call option.
AI Generated. May Contain Errors.
Earnings Conference Call
Gloo Q1 2027
00:00 / 00:00

There are 11 speakers on the call.

Speaker 4

To remove yourself from the queue, you may press star one one again. I would now like to hand the call over to Oliver Roll, Chief Marketing & Communications Officer. Please go ahead.

Speaker 3

Thank you, operator. Thank you to all of you for joining our fiscal first quarter earnings conference call. We will be discussing Gloo's performance for the first quarter ended April 30th, 2026, as well as providing guidance for our Q2 and full year 2026. Joining me on today's call are CEO and Co-founder, Scott Beck, and CFO, Paul Seamon. Our Executive Board Chair and Head of Technology, Pat Gelsinger, will also join the Q&A session. Before we begin, please be reminded that this call will contain forward-looking statements, including statements related to our business, future growth, strategic initiatives, key priorities, and our financial outlook for Q2 and fiscal year 2026. These statements are based on Gloo's current expectations, but are subject to risks and uncertainties relating to future events and/or the future financial performance of Gloo.

Speaker 3

Gloo assumes no obligation to update or revise them, whether as a result of new developments or otherwise. Actual results could differ materially from those anticipated in these forward-looking statements. A discussion of some of the risks that could cause actual results to differ materially from our forward-looking statements can be found in today's press release and are disclosed under the caption "Risk Factors" and elsewhere in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K for the fiscal year ended January 31st, 2026. Our SEC filings are also available on Gloo's investor relations website at investors.gloo.com and the SEC's website. In addition, during today's call, we will discuss certain non-GAAP financial measures, including adjusted EBITDA. We use non-GAAP measures in some of our financial discussions as we believe they provide valuable insights on our operational performance and underlying operating results.

Speaker 3

These non-GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from, our GAAP results. Reconciliations of these non-GAAP metrics to the most directly comparable GAAP metrics, as well as the definitions of each measure, their limitations, and our rationale for using them, are included in today's press release and will be included in our Form 10-Q to be filed for the quarter ended April 30th, 2026. Now I'll turn the call over to Scott.

Speaker 9

Thanks, Oliver, and thank you for joining our 2026 first quarter earnings call. Q1 was another strong quarter for Gloo. We exceeded our guidance and street consensus on both revenue and adjusted EBITDA. Revenue came in at $41.5 million, growing 3x over the prior year. This was also 13% above guidance and street consensus. Adjusted EBITDA was negative $11.5 million, also ahead of guidance and street consensus, and representing more than a $7 million sequential improvement from Q4 2025. This represented our third consecutive quarter of sequential adjusted EBITDA improvement. This progress reinforces our confidence in delivering against our adjusted EBITDA profitability goals with adjusted EBITDA expected to approach breakeven in Q3 of 2026 and reach profitability in Q4 2026. Our Q1 results demonstrated that our strategy is working. We're seeing growing demand from large strategic customers.

Speaker 9

Our current acquisitions are delivering compounding value, and AI is becoming an increasingly important accelerator across the business. Before turning to the specific drivers for the quarter, I want to connect our results to the broader opportunity. Gloo is building the leading technology platform for the faith and flourishing ecosystem, with Applied AI becoming a defining capability across the platform. This is a large, durable, and highly fragmented ecosystem spanning education, social impact, Bible translation, churches, and the denominations that serve them. Donations remain the economic engine of the ecosystem, funding the mission-driven work of faith and flourishing organizations. In 2025, revenues for faith-based organizations grew 8.2% to more than $265 billion, underscoring both the scale of the opportunity and the importance of donor development. Across these segments, organizations consistently need two things.

Speaker 9

They need to modernize technology, and they need to expand marketing reach to attract more donors and more constituents. That is how we have organized the Gloo platform, Powering Tech and Powering Reach. Applied AI has become an increasingly important capability of the platform. Our Powering Tech business is designed to take over the customer's technology operations, modernize them, and then apply agentic AI to deliver significantly better outcomes at lower costs for our customers while creating higher margins and durable revenue streams for Gloo. With Powering Reach, Applied AI helps customers better understand their audiences, personalize engagement, and strengthen donor development. That combination is what makes Gloo distinct. We are not simply providing software or services. We are bringing Applied AI into the workflows that matter most to the organizations that we serve.

Speaker 9

We can do this because Gloo has earned a position of trust within the faith and flourishing ecosystem. Over decades, we have built the relationships and credibility needed to convene leaders, understand their most important workflows, and apply AI in ways that are practical and mission-aligned. In Q1, we saw strong momentum across the platform. On the Powering Reach side, Masterworks, Barna, and Westfall delivered one of their best revenue quarters ever. That performance demonstrates the value of combining donor engagement with media, research, and the fundraising capabilities all on one platform. On the Powering Technology side, customers are increasingly selecting Gloo to take over, modernize, and transform core technology operations through offerings like Gloo360. In Q1, that momentum showed up in larger strategic wins, including five new customers contributing more than one million in annual contract revenue.

Speaker 9

These larger strategic wins show growing traction across both existing and new segments of the faith and flourishing ecosystem. Assemblies of God is a strong example of a denomination choosing Gloo. They are leveraging Gloo360 across their enterprise by modernizing legacy systems to better serve their 13,000 churches within the United States. Indiana Wesleyan University is another important example. We're partnering with Wesley Seminary at IWU to build VIA Journeys, an AI-powered ministry life cycle ecosystem that connects ministry leaders with personalized resources and mentors. We believe this points to a broader transformation in how universities will equip students and the communities where they lead. For example, our work with Jessup University, announced earlier this year, is progressing extremely well and running ahead of schedule. Beyond the customer examples, we continue to build broader ecosystem momentum around Applied AI.

Speaker 9

Our 2026 fourth annual Gloo Hackathon will bring together more than 700 developers, engineers, and mission-driven builders in Boulder this October for 48 hours of hacking and building mission-aligned apps and technology. This quarter, we announced the general availability of Gloo AI Studio, a comprehensive set of AI tools and capabilities for developers in the faith and flourishing ecosystem. This release includes support for over 80 LLM models. It includes new safety capabilities, varied subscription options to pay for token usage, and a free sandbox for developers to experience our values-aligned guardrails. The goal is to accelerate practical AI solutions that advance human flourishing. Moving now to acquisitions, which remain a key part of how we're strengthening the Gloo platform. Our strategy is to add best-in-class providers that expand our ability to Powering Tech and to Powering Reach. Q1 provided strong evidence that strategy is working.

Speaker 9

Westfall Group and Masterworks both delivered one of their best quarters ever. That validates the strength of those businesses and the compounding value of bringing them onto the Gloo platform. During Q1, we signed a purchase agreement to acquire EMD, which we closed at the beginning of Q2. EMD expands our Powering Tech portfolio with Workday consulting, implementation, and support capabilities for not-for-profit, small, and mid-market organizations. EMD also aligns directly with our broader strategy that I mentioned earlier. We take on and modernize critical customer workflows, then apply specialized engineering talent and agentic AI to deliver them better outcomes at a lower cost. Over time, this creates a strong customer value proposition while also improving Gloo's margin profile. Today, we're also announcing the acquisition of the remaining stake in Midwestern, bringing our ownership to 100%. Midwestern increases our investment in the cost-effective global talent capability area.

Speaker 9

We believe this will continue to be a significant growth opportunity as we combine lower-cost delivery capabilities with agentic AI. This also eliminates the call option, which will result in a one-time improvement by removing the associated $12.1 million liability from Gloo's balance sheet. Together, these acquisitions strengthen the platform, expand customer value, and reinforce the flywheel that we're building. Our approach with acquisitions is always disciplined. We continue to see a strong pipeline, but we will only pursue opportunities that are best in class, strategically aligned, and accretive to the Gloo platform. Even though we have a strong pipeline, as we previously stated, our current plan does not depend on additional acquisitions to achieve our revenue or adjusted EBITDA profitability guidance. As we look ahead, our priorities remain clear.

Speaker 9

We're focused on deepening strategic customer relationships, scaling our platform, and applying AI in ways that improve outcomes for our customers while creating durable value for Gloo. At the same time, we will keep integrating acquisitions with discipline and executing against our path to profitability. Q1 was a strong start of the year. We remain confident in our strategy, our 2026 plan, and the long-term opportunity to build the category-defining technology platform for the faith and flourishing ecosystem. Paul, I'll turn it over to you to walk through the numbers in more detail.

Speaker 6

Thank you, Scott. We delivered strong first quarter results with both revenue and adjusted EBITDA beating guidance. This performance reflects solid business momentum and disciplined execution, giving us a solid financial start to the year. Q1 revenue was $41.5 million, an increase of 238% compared to the same period last year, and 23.5% sequential growth compared to Q4. Year-over-year revenue growth was driven by momentum in several business lines, most notably Gloo 360, as well as the acquisitions of Capital Partner businesses such as Masterworks and Midwestern. Platform revenue totaled $24.1 million, an increase of $15.6 million from Q1 of last year, and up 19.9% over Q4 2025. Platform solutions revenue was $17.4 million, up $13.6 million from the same period in 2025, and about 29% sequentially. Cost of revenue in the quarter was 67.7% of total revenue, an improvement from 72.1% in the prior year period.

Speaker 6

That increase was driven by improvements in margins at our Workspace and Outreach business lines, as well as the full quarter of Westfall Group. We expect improvement to continue through the year. Adjusted EBITDA improved $7.1 million sequentially to negative $11.5 million. This significant improvement reflects the impact of our cost-saving actions implemented in Q4, along with the growth already mentioned. In particular, our operating expenses decreased $8.4 million sequentially, while revenue grew 24%. Also note that general administrative expenses include acquisition costs related to the EMD acquisition, which closed in the second quarter. We do not adjust for these costs in our non-GAAP results. We expect continued sequential improvement in Q2 as we aim to achieve adjusted EBITDA profitability in Q4.

Speaker 6

As Scott described earlier, we recently agreed to purchase the remaining 20% of Midwestern that we did not previously own, as well as eliminate the call option permitting the holder of the remaining 20% from reacquiring a controlling interest of Midwestern from us. We anticipate closing on the transaction later this quarter. The elimination of the call option will result in no longer having large swings in the financial statement reporting line titled "Gain or Loss from Change in Fair Value of Financial Instruments." As of April 30th, 2026, we had $33 million of cash and cash equivalents. We believe that we have the liquidity to reach positive adjusted EBITDA in Q4, which we expect will put us on a path of sustainable, positive free cash flow growth in future quarters.

Speaker 6

With significant momentum across the business, we also believe we have multiple options to further strengthen the balance sheet, fund our growth, and support future acquisition opportunities should we choose to pursue them. I'd like to now turn to our full year 2026 and Q2 outlook. For full year 2026 revenue, we're increasing our outlook $5 million to $195 million. In the second quarter, we expect revenue to be $44 million and adjusted EBITDA loss to narrow to a negative $8.5 million. We continue to expect adjusted EBITDA to approach breakeven in Q3 2026 and reach profitability in Q4 2026. For Q2, we expect a weighted average share count of approximately 81 million shares. With that, I'll turn this call back to Scott.

Speaker 9

Thanks, Paul. With that, operator, we're ready to take the first question.

Speaker 4

As a reminder, to ask a question, you will need to press star one one on your telephone. To remove yourself from the queue, you may press star one one again. Please limit yourself to one question and one follow-up to allow everyone the opportunity to participate. Please stand by while we compile the Q&A roster. Our first question comes from the line of Daniel Kurnos of Benchmark. Your line is open, Dan.

Operator

Great. Thanks. Good afternoon, Scott, Paul. Congrats on another great quarter. I guess first question, the revenue cadence implies a bit of a re-acceleration in the back half. Not to say that the growth hasn't been impressive, and I just want to get a sense from you guys. I know you said in the last call, starting to see larger customer wins. You flagged the $5 million annualized contracts this quarter. And how much line of sight do you have into stuff like that, and how much is coming from, let's call it the more recently acquired business, and how has that mix changed since the April guidance?

Speaker 9

Yeah, thanks. Good to hear from you, Dan. We definitely have been able to have continued acceleration. I wouldn't say that it is accelerating any different than it has been. We've been super pleased with the growth. The growth has been a combination of scaling some of the core Gloo offerings like 360 and Gloo AI. At the same time, it's also been able to continue to scale and get synergies across the different Capital Partners that we've acquired over the years as well. We've been able to drive really strong organic growth in our core offerings, as well as really strong organic growth in the offerings from the different Capital Partners. One of the great things that we're excited about is being able to see the synergies that are taking place in the cross-sell.

Speaker 9

More and more of the organizations that we're serving, they have one offering, but when we see them get to that second offering, we see a significant step-up, almost two times the revenue. When they get to three or more offerings, we're now then seeing that to be closer to sometimes five to 10 times the volume of what just a single offering should be. It's really a combination of the two. Overall, we're seeing more than 30% sort of coming from a lot of these organic growth and the organic growth of the new acquisitions.

Operator

Scott, that's a great segue into my next question. I'm just trying to understand, you talked about land and expand, right? You just outlined the way that you guys attack that. I just want to get a sense from you, when you win one of these larger contracts, are they taking multiples at once? Is it dip the toe in the water, and then all of a sudden you think that that contract can be 10x over time? I just want to get a sense from you, we know that this is a massive TAM and you guys are the undisputed leader with really no competition out there, I'm just trying to get a sense of how quickly some of these major deals can expand, because you guys have had a lot of very early success, even earlier than I think most of us anticipated.

Speaker 5

Yeah. Thanks, Dan. This is Pat. I'll just say that, as we, I think, noted in the formal comments, 30% of our customers over $1 million now are on more than one, which means the large majority are only one. Typically, a sale will be a single product area that we then expand one or two quarters later over time. Most of them start with one, right? Some of our sales strategy is to keep things simpler and moving forward. I will say, we have had a couple that we've landed more than one product area at the same time for them. I expect that that will become a larger aspect of our sales motion as each of the sales offerings becomes more mature, we have more customers in the land expand, and then we'll be able to land expand over time.

Speaker 5

So far, it's mostly one landing in a quarter, then we're following it with a subsequent offer later in time.

Operator

Got it. Thank you, Pat. That's super helpful, you're already putting up the numbers, excited to see what you guys do next. Thanks, guys.

Speaker 5

Thank you.

Speaker 4

Thank you. Our next question comes from the line of Richard Baldry of Roth Capital. Your line is open, Richard.

Speaker 7

Thanks. When we look from Q4 to Q1, the revenue increase had about a 70% gross margin contribution on the quarter. I'm sort of curious if you can look into that and talk about how much would be because of the organic growth, and how much might have been sort of cost realignment. It's 2x where your normal gross margins are sitting today. I'm sort of curious how sustainable that sort of drop-down could be as we move forward.

Speaker 9

Yeah, great question, Rich. Thanks for chiming in. I think there's a balance between the two in the quarter. We definitely got some significant benefit from overall reduction in our operating expenses, that you saw that flow through in terms of contribution to adjusted EBITDA which was obviously very significant relative to the revenue increase. I would say that you've got somewhere between 50% and 60% of that probably came from the operating expense, and the remainder came from just continuing to get leverage across the cost basis associated with what you would think of as the cost of goods sold or contribution margin.

Speaker 7

Thanks. You're still early into some of the larger deals on the Gloo360 side, I'm curious as those are under your umbrella a little bit longer, are you seeing incremental headcount synergies? Are you starting to see early cross-selling or upselling opportunities? How are the earlier large deals playing out?

Speaker 5

Yeah, every one of them is causing us to just get more mature, Rich. This is Pat again. We're getting more proof points of different offerings. As we get more and more customers, hey, we already have some level of expertise on some of the tools that we're picking up from them. We already have more maturity in some of the agentic workflows that we're applying to them. Of course, our HR systems are getting more mature of being able to bring them in, onboard them, and make the best application of good HR disciplines to those as well. I'll say every one of these is making us better. We still, I'd say, are not fully mature in those offerings because several of them are ones that we're still picking up and learning.

Speaker 5

I think we still have a lot of margin improvement to get, as well as rapidity of the motions and the ability to onboard and then to be able to commercialize. The good aspect of this is that every one of those that we do, we are now creating the agentic workflows that the next one is just easier and faster. We just see this as an engine that we are going to be able to rinse and repeat over and over again, and each one of those is showing more maturity in the offering. A long way to go. The ecosystem is large, but we are now having more and more proven capabilities that can be applied against them.

Speaker 7

If I can squeeze one last one in. When you look at the five deals over $1 million, can you talk about, are there any commonalities across those or are there multiple entry points you can do those in now? Just so we can sort of see how extensible that is going forward. Thanks.

Speaker 5

Maybe Scott, you can add as well, but we are starting to see a lot more pipeline in the university segment, in particular, which is one that we have highlighted. William Jessup was our first major example. We are now closing more of those offerings. That is an area that, as you said, there is over 900 faith-based universities in the U.S. We have a long path to go. We are clearly a critical mass in some sectors, such as Bible translation, campus ministry, and other areas like rescue mission is an area that our work that we have specifically on Powering Reach is well proven. There is a lot more opportunities there. Finally, I think as we noted in our formal comments, we have started to have some success in the Catholic segment, which is a very large space for us that we are just getting started.

Speaker 5

I think more replicable, big opportunities that we see the land expand just as enormous pathway in front of us. Scott, anything else you would add?

Speaker 9

Thanks, Pat. I really like what you've coined there in terms of land, expand and expand, because we're landing and expanding within a specific account. When we find ourselves into a category like campus ministries or a category like faith-based universities or rescue mission, when we find ourselves getting into a different segment, that segment also has the dynamic of expand as well. We've got really the power of landing and expanding within an account and expanding again within a category. We've been adding categories extremely quickly. Really sort of surprising in terms of how quick the categories are expanding. One of the things I would like to anchor us back in is they are looking for the same thing, okay?

Speaker 9

There's a commonality in terms of, hey, help me Power Tech, help me get more Power Reach so I can have more donors, more constituents, more students, more volunteers, you name it. They're really Power Tech, Power Reach, just being able to then apply AI to be able to give them the lower cost, better benefit, and to give us an ever-increasing margin as we bring more AI-executed work into the program.

Speaker 7

Got it. Congrats on a great quarter.

Speaker 9

Thank you.

Speaker 4

Thank you. Our next question comes from the line of Young Kim of Loop Capital Markets. Your line is open, Young.

Speaker 10

Okay, great. Thank you. Congrats on a strong quarter. On the EnterpriseMarketdesk business, can you update us on the progress that you have made since the acquisition closed? And for the EnterpriseMarketdesk customers, I know there's some who are not faith-based customers or organizations. Do you expect the non-faith-based customer base to show growth there? Or is your near-term go-to-market primarily focused on faith-based organizations?

Speaker 9

Yeah. As you're aware, they do have both faith-based and not faith-based, and we're growing them both. Obviously, we've got some obvious synergies within the faith-based where we can do a lot of cross-selling immediately, but also in the non-faith-based. That's on its own growth plan as well. Relatively new, right? It just closed at the beginning of this quarter. We're five or six weeks in now. We're liking what we're seeing. Additionally, Midwestern, which we just went to 100% ownership from 80%, those guys have pretty much the same profile. A significant amount of Midwestern is also non-faith-based. It's pretty much about the same percentage, say about a third faith-based and about two-thirds not faith-based. It's nice to be able to see some of the synergies there between, let's say, a Midwestern and an EMD on the non-faith-based side. Yeah, they're both growing.

Speaker 9

We're committed to growing them both. For the last few years at Midwestern, we've grown both sides of it as well.

Speaker 10

Is there an opportunity to cross-sell Gloo360 to the non-faith-based customers of EnterpriseMarketdesk?

Speaker 9

Yeah, there are. There's no question that the small to mid-size organizations are coming up against the same set of issues, which is, "Hey, help me with my tech, help me with my reach." Those are common concerns, common value propositions, whether they're faith-based or not faith-based organizations. Everybody needs help applying AI into their specific organizational workflows. Likewise, when you've got a workflow that helps somebody engage with employees on an ongoing basis, that workflow is the same, whether it's a faith-based or a non-faith-based workflow. There's a lot of commonality against that as well.

Speaker 10

Okay, great. Maybe this question is for Pat, but I know it's very early, what's been the early feedback on Gloo AI Studio? Was that part of your Gloo AI Hackathon at all? Thanks.

Speaker 5

Yeah. The early feedback is strong. Obviously, as you open a new service like that, there's lots of learnings. As developers come on and we're getting more efficient at bringing developers on, bringing the billing systems up and operating for them. We did have a big customer, HelloBible, that does a consumer chat service move over to Gloo AI Studio. They were public on LinkedIn or one of the other social channels about that and the good experience that we're having. We're now starting to have, I'll say, real customers who are bringing their workloads onto the platform. We also, as a result of Studio, we will have more to talk about as we go through our virtual Gloo AI Hackathon events and then our big Gloo AI Hackathon in the fall.

Speaker 5

They will be very heavily featured and announcements of new capabilities, new services, new customers coming on the platform as part of the hackathon is a big thing when we come up on that in the fall. Overall, we're happy with the momentum that we're seeing. 1,000-plus developers now on platform. We have to grow this much faster, much larger, and we believe that we now have a mature offering that will enable us to do exactly that.

Speaker 10

Okay, great. Looking forward to it. Thank you very much.

Speaker 4

Thank you. Our next question comes from the line of Jason Kreyer of Craig-Hallum. Your line is open, Jason.

Speaker 1

Great. Thank you, guys. Scott, great to hear the early success with cross-sell here in the first quarter. Wanted to ask just about the go-to-market for cross-selling these new solutions to existing customers. If we think about a Westfall or an EMD, how quickly can you get customers interested in the new solutions? How quickly can you get them up and running? And just what that upsell process looks like.

Speaker 5

Generally, there's a strong effort and our Chief Revenue Officer, Rebecca, runs a very aggressive process across the different sales teams to drive exactly that. We're seeing a good effect from that already. I'll say we're pleasantly surprised how easy it is to get that process underway. We do see that Westfall Gold with Masterworks, 360 into Masterworks accounts, Servant into our 360 accounts. These motions are ones that we think have a lot of replicability, a lot of scale. Overall, we're just building more sales capacity. We're bringing sales teams on. We're getting more rigorous in our processes to manage large account pipelines. Then building more cross-sell mechanisms across the portfolio. We just see ourself at the beginning of the cycle, and every element of the portfolio gives us more opportunity to cross-sell.

Speaker 1

Perfect. One follow-up just on the M&A has continued to expand your addressable market. When you think about the bigger customers that you have today, curious what you think your penetration is into the existing base? I'm trying to figure out how much runway is there ahead with such a large customer base into a large addressable market.

Speaker 5

The runway is truly enormous. That's why we somewhat easily talk about TAMs in excess of $100 billion. This is just a large market for it. When we talk about universities, we now have several closed, 900 to go. Even where we're pretty well penetrated in a few accounts at this point, we're not well penetrated across the portfolio. We even in our land expand into the account have room to grow. We would consider our effective SOM to be in very low % at this point. The TAM is enormous. The SAM that's reachable is very large. We don't see ourself as anywhere close to saturation on any dimension of the business.

Speaker 1

Wonderful. Thank you.

Speaker 4

Thank you. Our next question comes from the line of Ryan Myers of Lake Street Capital Markets. Please go ahead, Ryan.

Speaker 8

Hey, guys. Thanks for taking my questions. First question here. Have you seen any changes in customer budgets or any other major changes across the ecosystem in terms of appetite for more digital offerings?

Speaker 9

Thanks, Ryan. For sure. As I said in my prepared remarks, the revenue in this ecosystem grew at 8.2% last year. For a very significant, what is an old ecosystem, to be able to have that kind of growth is remarkable. As a result of that, you get more budget dollars to work with. There's no question that that kind of growth in the core donations that are funding this ecosystem definitely allows us to be able to have more dollars to work with. We feel it. I would say there's another thing, too, and that is that younger people are re-engaging at a much bigger and higher number than others in spirituality and faith. That bodes really well for where we're at in the overall cycle.

Speaker 9

Because if you look at that growth and you were to segment that, I would imagine that you'll definitely see the younger people having a very significant positive influence on the market. Not only in terms of there's more dollars to be worked with, no question, but it's just encouraging. Our market is encouraged. They're seeing a lot of opportunity to serve in the community. When you have younger people starting to show up, that's a very big encouragement to this ecosystem.

Speaker 8

Got it. Thank you. Second question here. You mentioned 30% organic growth. How much of this do you think will come from new customer wins versus new customers expanding their spend?

Speaker 9

Yeah, I said 30% plus. We're above that. We're very comfortable with that continued organic growth. Our big driver is new customers. That is what's really driving our growth in terms of within that organic growth, so much of it is new people that are getting introduced to Gloo 360, Gloo AI, Masterworks, Barna, across the board. It is really about attracting new into that growing the ones that we currently have. Both are happening, absolutely new names is super important. Pat, what would you add to that?

Speaker 5

Not too much to add. The opportunity for us as we build our sales force is one that we just get more and more account coverage over time. We're regularly adding more salespeople to 360, to Masterworks, to our Westfall Gold. Every one of our offerings is getting more sales capacity, we'll be able to invest more into it. We do not see that there's budget limitations, even though we don't really fundamentally view that tighter budgets is a bad thing for us. Fundamentally, they're looking for cost savings, we also present cost savings to them as well. We do see ourself in many respects as not particularly vulnerable to cost issues. This is a good time for our ecosystem, as Scott has said. It's a good time for our offering.

Speaker 5

As we build more capacity to sell and deliver, we do think that we see a very clean line of sight to a rapidly growing revenue customer base and land expand for many quarters to come.

Speaker 8

All right. Thanks so much, though. Super helpful.

Speaker 4

Thank you. Our last question comes from the line of Matthew Harrigan of The Benchmark Company. Your line is open, Matthew.

Speaker 2

Thank you. Good to book-end the call. You made a reference at the end of one of your answers to getting traction with the Catholics. Clearly you've been focused on Evangelicals relative to Catholics or Anglicans. It's interesting, the Catholic Church certainly was arguably the most successful hierarchical global organization for a long time. Obviously it's unique on the educational side, both on the secondary schools and a lot of universities, although they're becoming, I guess, increasingly secularized.

Speaker 2

If you really get traction on the Catholic side or some of the other denominations where you're not as penetrated, could you hit a pretty fast tipping point where at a higher level, you could have a lot of acceptance of a broad bouquet of products relative to, I think, some of the denominations you're dealing with maybe more on a grassroots basis where you get really good word of mouth. You have to convince a lot of people to get momentum. Thanks. Congratulations on the results, clearly.

Speaker 5

Yeah. Thank you. Well, I think first I'd say that we're probably not far enough along to know the repeatability of the sales patterns yet in the Catholic segment. I'd say it's a great question for us to come back to in future quarters as we have more Catholic customers, we see more of the sales motion. That said, given the hierarchical nature that you point to, we think that you actually have very referenceable relationships across them. As you get success in one, it'll be very repeatable across others. We do, for that very reason, think that we will have good sales productivity as we engage. We have also had the most success so far Powering Tech in that sector, but we do see that the full range of our offerings could be applicable there at scale.

Speaker 5

We've also had good affinity for some of the AI opportunities that we uniquely have and gaining more momentum with customers there. Overall, I say it's very early for us, but we're super happy because of the size. When you look at the size of that portion of the marketplace, archdioceses across the nation are large. They have large technology needs, and as you say, they're structured, organized, and we believe will be very repeatable.

Speaker 2

Could that extend into the university side as well, or is that kind of?

Speaker 5

Yes

Speaker 2

different animal?

Speaker 5

No.

Speaker 2

Okay

Speaker 5

We see it as very replicable into the university side. Of the 900 that we've quoted, a little bit, sort of two-thirds, one-third. Two-thirds are evangelically oriented and one-third Catholic oriented. We do hope to have several successes in the university side of the Catholic community as well.

Speaker 2

Great. Thank you.

Speaker 4

Thank you. I would now like to turn the conference back to Scott Beck for closing remarks. Sir?

Speaker 9

Thanks a lot. Appreciate that. As you can tell in the call, we're super excited about the performance. We're also really excited about the progress. This faith and flourishing ecosystem needs what Gloo is providing. The technology and the marketing reach, all being powered by AI. It is just incredibly good timing for us to be sort of at the point that we're at. It's still early. We're still early on in our journey as a public company. The momentum's strong and it's growing. We really do have an opportunity to build a category-defining technology platform for this ecosystem. In doing that, one of the things that excites us the most is that we can actually be engaged in shaping technology as a force for good.

Speaker 9

If you think about it, the time and the intensity of the technology changes that are taking place right now, it's one of the most consequential periods of change in our lifetime. To be able to be there and to be able to be on the front lines with these organizations is super encouraging to our organization. As we're doing this, we always have to remember that we're serving those who serve. That's the ministers, the campus ministries, the rescue missions, the world child development organizations, the global water organizations, the faith-based universities, the churches and the denominations that serve them. In doing that, they're out on the front line, and they're out there changing lives for real people. They're changing families, they're changing cities. As we pursue this all together, we're pursuing it so that we can accomplish the vision that we have.

Speaker 9

That's a world where every person can flourish and be all that they were born to be. That's what fires us up. That's what gets us out of bed in the morning and gets us pressing so hard. You all, as shareholders, are part of that. You're making a difference in these organizations. You're being able to give them access to capabilities and capital that allow them to scale what they love to do and what they're called to do. We're grateful. We're grateful for the champions that we serve, and we're grateful for the shareholders that are serving on behalf of them with us. On behalf of all of us, we say thank you. Thanks for tuning in today. God bless you. God bless you in all your efforts and Gloo in its efforts as well. Thank you.

Speaker 4

This concludes today's conference call. Thank you for participating. You may now disconnect.

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