Intapp Q4 2025 Earnings Call Transcript

Quartr
Provided by Quartr
August 12, 2025

Key Takeaways

  • Positive Sentiment: In Q4, cloud ARR grew 29% year-over-year to $383 M—now 79% of total ARR—and total ARR hit $485 M, with SaaS revenue up 27% to $90 M.
  • Positive Sentiment: New AI capabilities—including Intapp Assist for DealCloud, AI-powered intake summaries, and AI Walls—drove strong client enthusiasm and notable wins at firms like Eversheds Sutherland and Pantheon Ventures.
  • Positive Sentiment: Strategic partner ecosystem expansion, led by Microsoft (involved in nearly half of top Q4 deals) and new collaborations with Snowflake and MSCI, accelerated deal execution and platform adoption.
  • Negative Sentiment: Professional services revenue declined 2% in Q4 and 3% for FY ’25, as implementations increasingly shift to third-party partners amid the cloud migration trend.
AI Generated. May Contain Errors.
Earnings Conference Call
Intapp Q4 2025
00:00 / 00:00

Transcript Sections

Skip to Participants
Operator

Hello, everyone, and welcome to the Intacct Fourth Quarter Fiscal twenty twenty five Earnings Webcast. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. Now, it's my pleasure to turn the call over to the Senior Vice President of Investor Relations, David Trone. The floor is yours.

David Trone
David Trone
SVP - IR at Intapp

Thank you. Welcome to Intab's fiscal fourth quarter and year end twenty twenty five financial results. On the call with me today are John Hall, Chairman and CEO of Intab and David Morton, Chief Financial Officer. During the course of this conference call, we may make forward looking statements regarding trends, strategies and the anticipated performance of our business, including guidance provided for our fiscal first quarter and full year 2026. These forward looking statements are based on management's current views and expectations, entail certain assumptions made as of today's date and are subject to various risks and uncertainties, including those described in our SEC filings and other publicly available documents that are difficult to predict and could cause actual results to differ materially from those expressed or implied by such forward looking statements.

David Trone
David Trone
SVP - IR at Intapp

Intab disclaims any obligation to update or revise any forward looking statements except as required by law. Further on today's call, we will also discuss certain non GAAP metrics that we believe aid in the understanding of our financial results, including non GAAP gross margin, non GAAP operating expenses, non GAAP operating income, non GAAP diluted net income per share and free cash flow. As a reminder, all of our financial figures we will discuss today are non GAAP financial measures or other metrics, except for revenue and revenue growth, cash and cash equivalents and total remaining performance obligations. Our GAAP financial results, along with reconciliations of GAAP to non GAAP financial measures, can be found in today's earnings release and its supplemental financial tables, which is available on our website and as an exhibit to the Form eight ks furnished with the SEC prior to this call or a supplemental financial presentation, which is available on our website. With that, I'll turn the conversation over to John.

John Hall
John Hall
Chairman & CEO at Intapp

Thank you, David. Good afternoon, everyone. Thank you for joining us today as we share the results of our fiscal fourth quarter and full year fiscal twenty twenty five. I'm happy to say that once again, we've achieved strong quarterly results as well as a strong year across the business. In Q4, our cloud ARR grew 29% year over year to $383,000,000 Cloud now represents 79% of our total ARR of $485,000,000 In the quarter, we earned SaaS revenue of $90,000,000 up 27% year over year and total revenue of $135,000,000 up 18% year over year.

John Hall
John Hall
Chairman & CEO at Intapp

Additionally, we now have 109 clients with ARR of more than $1,000,000 a year over year increase of 49%. We released additional AI capabilities designed for the specialized needs of our highly regulated target markets, and we're seeing real enthusiasm for these. We expanded our product portfolio and R and D capability through strategic acquisitions. We added notable new logos, consistently grew existing accounts via cross sell and upsell, expanded our international footprint and migrated more clients to the cloud. We also continue to grow our partner ecosystem with significant wins related to our partnerships, most notably Microsoft.

John Hall
John Hall
Chairman & CEO at Intapp

Going into fiscal year twenty twenty six, we feel optimism and confidence that our applied AI strategy, vertical SaaS platform, enterprise go to market strategy and unique competitive position for these highly regulated firms provides a strong foundation for sustained growth and execution in this large addressable market. Now I'd like to share some details on our growth drivers from the quarter and the year. We continued progress on our applied AI strategy and road map this year. We launched several new AI solutions and showcased our innovation at our largest client event, IntApp Amplify, in February. Our AI strategy reduces cost through automation and helps the professionals to grow revenue by providing back to them unique insights from the firm's proprietary data, relationships and knowledge, all while staying compliant with the industry's complex regulations.

John Hall
John Hall
Chairman & CEO at Intapp

Our AI is helping our firms to originate and win more business and to onboard new clients and engagements faster while maintaining the unique compliance obligations that this highly regulated industry requires. In their increasingly competitive markets, this is what firm leadership is looking to invest in, using AI to arm their professionals with more of their firm's differentiating proprietary knowledge and expertise, which live in IntAP's systems. As a quick recap from last quarter, we announced the general availability of IntAP VeoCloud Activator, a research backed AI enabled growth platform that gives professionals the tools, insights, and coaching they need to build, scale, and apply the most successful business development behaviors. We added new inTAP Assist for DealCloud capabilities, including origination, recommendations, smart tagging, prompt studio, and AI powered search. We announced the general availability of Intep Assist for terms, a new Gen AI feature that makes it easier for legal professionals to comply with client terms.

John Hall
John Hall
Chairman & CEO at Intapp

We introduced Intap walls for AI, which offers protection against the oversharing of confidential data by AI tools. And in Q4, we launched the next generation of in tap intake, featuring AI powered persona driven summaries and in tap data integration. Our AI driven wins for this year and the quarter speak to our clients' enthusiasm. To name just a few wins here, an international commercial law firm chose Assist and our compliance solutions to help them comply with new AML regulations in Australia. Eversheds Sutherland, an AMLOW 200 firm, purchased IntapAssist to help manage the complexity and volume of outside counsel guidelines.

John Hall
John Hall
Chairman & CEO at Intapp

And Pantheon Ventures, a global private equity firm, replaced its legacy system with DealCloud and IntapAssist to improve deal flow, capture more opportunities and bring AI into their workflows. You'll hear more about our AI wins throughout my remarks. We're also pleased to have furthered our growth through our expansive partner network and strategic combinations. I'll speak first about our partnerships. We continue to build our partner strategy around strategic depth as well as breadth.

John Hall
John Hall
Chairman & CEO at Intapp

We've curated a high impact ecosystem anchored by Microsoft and a focused set of vertical data technology and services partners. This ecosystem consistently helps us scale our largest deals, accelerate time to value and expand platform adoption. Some notable new and expanded partnerships announced this quarter include an expanded partnership with Snowflake, which lets our clients build and apply analytics across firm wide data in the Snowflake AI Data Cloud and a new partnership with MSCI, which provides access to private capital, real asset and deal data within Intact Yield Cloud. In Q4, partners were directly involved in 17 of our 20 largest deals. Microsoft, in particular, continues to be a major growth driver.

John Hall
John Hall
Chairman & CEO at Intapp

Almost half of our largest Q4 wins were jointly executed with Microsoft. And in several of those, Microsoft even fronted Azure investment dollars to help accelerate the deals. As an example, one of the world's largest multinational investment banks added on Intepp Assist after seeing it at Amplify. The firm's dealmakers will leverage Intepp's AI to bring a more robust and data driven approach to their complex network of deal sourcing relationships. Working closely with Microsoft, we were able to close the deal quickly and complete the purchase via the Azure marketplace using their existing MAC agreement.

John Hall
John Hall
Chairman & CEO at Intapp

Next, I'll speak about M and A. To briefly recap from Q3, we acquired Termsheet, a software provider for real estate teams. Bringing together DealCloud and Termsheet expands our capabilities and our ability to serve new personas within real assets. The Termsheet team is bringing great energy and insights, and we're already winning together with new clients like Cronos Real Estate Group, a real estate investor focused on Spain and Portugal True Homes, one of the largest private homebuilders in The U. S. And a private real estate investment firm with a primary focus on hotels and resorts. Speaking of growth, I'll now turn to some notable wins from Q4. Our growth was powered by adding new clients, expanding within existing clients and migrating clients to the cloud.

John Hall
John Hall
Chairman & CEO at Intapp

We also made traction in new markets, spanning across our verticals, products and global locations. Our success this quarter was bolstered by a number of large enterprise deals. As you may recall, in fiscal twenty twenty four, we successfully piloted our strategic accounts program. In fiscal twenty twenty five, we solidified this model by creating an enterprise sales group that focuses on large accounts, which represent 70% of our SAM. We saw tremendous success in this approach with 49% growth in the number of our million dollar accounts year over year.

John Hall
John Hall
Chairman & CEO at Intapp

I've already mentioned some today, but I'd like to share a few more examples of how our enterprise go to market strategy is working here in financial services. The M and A team at a multinational professional services firm chose DealCloud as part of its strategy to improve data management, access and analysis. A leading global alternative investment manager added additional capacity within DealCloud for new employees coming into the company following an acquisition And a preeminent multi strategy asset manager chose DealCloud with Intap Assist to replace a well known legacy horizontal software provider. Intap Assist was a differentiator that supported the replacement purchase because it enabled the firm's investment professionals to improve their comprehensive coverage of management teams and their pursuit of new investment opportunities. I'd also like to mention some new deals reflecting our continued success in investment banking.

John Hall
John Hall
Chairman & CEO at Intapp

Capstone Partners added DealCloud within TapAssist to support pipeline generation and streamline operations using AI and industry specific workflows. A large U. S.-based investment bank shows DealCloud for its M and A business as a single source of truth for deal data from origination to execution to long term relationship management. And a specialty investment bank focusing on M and A and capital advisory services for the middle market chose to replace its legacy horizontal solution with DealCloud and IntepAssist to facilitate firm growth and ensure a better AI driven user experience across the firm. In Q4 also, accounting firms continued to modernize their compliance practices using Intact solutions to handle the increased complexity created by PE investments and mergers.

John Hall
John Hall
Chairman & CEO at Intapp

These included Anderson Tax, one of the largest independent tax firms in the world Baker Tilly, a leading advisory tax and assurance firm, one of the largest accounting and advisory firms in The U. S. A top 10 global accounting firm. Additionally, law firms are continuing to replace legacy and horizontal CRM by adding Intap DealCloud to their existing Intap product portfolios. I'll share a few examples from Q4.

John Hall
John Hall
Chairman & CEO at Intapp

A Quebec based firm chose DealCloud and Intap and Intap Assist to support business development and relationship management in French. Fish and Richardson chose DealCloud to uplevel its business development activities and tracking, especially relationship management. And Marshall Gerstein chose DealCloud as its integrated system to enhance marketing and business development efforts, information sharing and activity tracking. Finally, our legal clients, Goodwin and Steptoe, continue to find value migrating their on prem in half time to the cloud. Once implemented, they'll have access to all our new AI features and our continuous innovation.

John Hall
John Hall
Chairman & CEO at Intapp

In conclusion, we're proud of our strong fourth quarter and fiscal twenty twenty five performance, and we continue to be optimistic about our growth opportunities. As our performance has shown, we're growing by adding new capabilities and increasing our global enterprise go to market reach. We see continued opportunity both to add new clients across a broad TAM and to deliver greater value by expanding our existing client base. We're serving a durable end market with our subscription revenue model, industry specific cloud platform and applied AI and compliance capabilities. We have a great growth opportunity to drive AI, cloud adoption and modernization across the industries we serve.

John Hall
John Hall
Chairman & CEO at Intapp

As always, I'd like to thank our clients, our partners, our investors, our Board and our global Intact team for their hard work and dedication. Thank you all very much. Okay, David, over to you.

David Morton
David Morton
CFO at Intapp

Thank you, John, and thanks to everyone for joining us today. I'm pleased to report a strong fourth quarter performance. We concluded fiscal twenty twenty five with several notable achievements that highlight our strong progress, winning in the cloud, expanding operational efficiency and deepening our presence with enterprise clients across our vertical end markets. We scaled our $1,000,000 plus annual recurring revenue, or ARR, client base into triple digits with both the number of clients and corresponding ARR more than doubling compared to FY 'twenty three. We grew our cloud business through land, expand and migration motions, with nearly 80% of total ARR now in the cloud.

David Morton
David Morton
CFO at Intapp

We surpassed the $05,000,000,000 mark in annual revenue, and we generated well over $100,000,000 in free cash flow. Results underscore the opportunity ahead of us as we continue executing against key market tailwinds, digitalization, cloud forward adoption and compliance driven demand. We enter fiscal twenty twenty six with strong traction and a sustained focus on delivering durable, profitable growth. Let's begin with the fiscal Q4 results. SaaS revenue was $90,200,000 up 27% year over year, driven by new client acquisitions, contract expansions and the migration of on premise products to the cloud. We exited Q4 with 93% of our clients having at least one cloud module and over 80% of our clients fully deployed in the cloud. License revenue totaled $31,800,000 up 5% year over year, primarily driven by on prem expansions within our compliance solutions. This was partially offset by the continued migration of clients through our cloud based SaaS offerings. Professional services revenue was $13,000,000 down 2% year over year. Our evolving partner ecosystem strategy is helping us more efficiently support long term cloud growth with increased emphasis on co sell production and elevated client satisfaction.

David Morton
David Morton
CFO at Intapp

Total revenue was $135,000,000 up 18% year over year, driven primarily by sales of our cloud solutions. Client adoption of Intact's vertical SaaS AI offerings accelerated in Q4, building on momentum from our Amplify product event. Assist for deal cloud now accounts for approximately 35% of new deal cloud wins, up from 8% last year. Looking ahead to fiscal twenty twenty six and beyond, we anticipate continued broad based adoption across all of our AI offerings, supported by a growing client base, a healthy pipeline, and a compelling value proposition. We remain focused on delivering vertical specific AI solutions that drive sustainable growth for Intact and long term value for our clients.

David Morton
David Morton
CFO at Intapp

Our partner ecosystem closed FY 'twenty five with 145 active partners, playing a critical role in our largest wins, accelerating time to value and driving broader platform adoption. Our co sell motion continues to deliver solid results with partner engaged enterprise deals outperforming on win rates over the past two years. Q4 highlighted the strength of this collaboration with partner influence bookings growing more than 50% year over year. As we continue to focus on margins and operational efficiency, our Q4 non GAAP gross margin was 78%, up from 76.1% a year ago, reflecting progress toward breakeven gross margins in professional services and a reduced top line contribution from that business. Non GAAP operating expenses were $84,000,000 compared to $73,600,000 in the prior year period, reflecting ongoing investments in our product led growth strategy and go to market motion as we enter fiscal twenty twenty six.

David Morton
David Morton
CFO at Intapp

Non GAAP operating income was $21,300,000 up from $13,500,000 in Q4 of last year. Non GAAP diluted EPS was $0.27 compared to $0.15 in the prior year period. Free cash flow was $37,500,000 for the quarter or 28% of total revenue, defined as cash flow from operations less capital expenditures. We ended the quarter with $313,100,000 in cash and cash equivalents, reflecting our upfront cash payment of $51,000,000 made at the April closing of our Term Sheet acquisition. Now turning to our key metrics.

David Morton
David Morton
CFO at Intapp

Our cloud ARR increased 29 year over year, while total ARR grew 20% over the same period. Total remaining performance obligations, RPO, were $719,700,000 up 27% year over year. We ended the fiscal year with over 2,700 total clients. Our go to market strategy this year has emphasized landing and expanding within enterprise named accounts, and that focus gained traction as the year progressed. We grew our 1,000,000 plus ARR client base to 109, up from 73 in the prior year, nearly 50% year over year growth.

David Morton
David Morton
CFO at Intapp

We also expanded our 100,000 plus ARR client base to seven ninety five, from six ninety eight a year ago. Our cloud net revenue retention rate was 120%, exiting FY 'twenty five, demonstrating strong retention and steady expansion among existing cloud clients. Now turning to our full year fiscal twenty twenty five results. SaaS revenue was $331,900,000 up 28% year over year driven by new client acquisitions, contract expansions and ongoing cloud migrations. License revenue totaled $120,000,000 up 2% year over year.

David Morton
David Morton
CFO at Intapp

Growth was driven by on prem price increases, on track expansions and multiyear renewals, partially offset by continued migration of on prem contracts to the cloud. Professional services revenue was $52,100,000 down 3% year over year. As we increasingly rely on our services partners to lead implementation, this aligns with our focus on co sell execution and improving client satisfaction. Total revenue reached $504,100,000 up 17% year over year, primarily driven by growth in our cloud solutions. Non GAAP gross margin was 77.3% compared to 74.2% in the prior year.

David Morton
David Morton
CFO at Intapp

Non GAAP operating income was $75,600,000 nearly double the prior year's 38,700,000.0 reflecting revenue growth, improved mix and operating leverage across expense lines. Non GAAP EPS was $0.94 up from $0.45 in the prior year. Free cash flow was $121,900,000 or 24% of total revenue, reflecting meaningful progress on strengthening our operational efficiency. Now turning to our outlook. For the 2026, we expect SaaS revenue of between $95,700,000 and $96,700,000 total revenue in the range of 134,800,000.0 and 135,800,000.0 Non GAAP operating income is expected to be in the range of 16,000,000 to $17,000,000 This Q1 outlook includes some front end spend related to our go to market motion, specifically our FY 'twenty six sales kickoff as well as targeted marketing investments as we build on the momentum from a strong Q4 and non GAAP EPS in the range of $0.18 to $0.20 using a diluted share count weighted for the quarter of approximately 85,000,000 common shares outstanding.

David Morton
David Morton
CFO at Intapp

For the full fiscal year 2026, we expect SaaS revenue of between $411,400,000 and 4 and $15,400,000 or revenue in the range of 566,700,000.0 and $570,700,000 This outlook assumes a professional services revenue mix consistent with fiscal twenty twenty five, where it accounted for approximately 10% of total revenue and reflects a more material participation in our cloud migration efforts non GAAP operating income in the range of 96,000,000 and $100,000,000 and non GAAP EPS in the range of $1.9 to $1.13 using a diluted share count weighted for the fiscal year of 2026 of approximately 87,000,000 common shares outstanding. Thank you. And I'll now turn the call back to the operator.

Operator

Thank you. We will now begin the question and answer Your first question comes from the line of Kevin McVeigh with UBS. Please proceed.

Kevin McVeigh
Kevin McVeigh
Managing Director at UBS Group

Great. Thanks so much and what a terrific, terrific result. I wanted to start on just kind of the 120% NRR. Maybe help it sounds like it's some retention and steady expansion, but maybe frame that a little bit more. And then what are you assuming in the 2026 guidance?

David Morton
David Morton
CFO at Intapp

Kevin, it's Dave. Thanks for the question. The 120% obviously has continued to be contributed by low churn that we've always commented on. You know, that's one of the beauties of being a very sticky vertical SaaS and knowing your end clients. Secondly, as we continue to go further upstream into the enterprise, those expands get even more material, both from an upsell as well as a cross sell.

David Morton
David Morton
CFO at Intapp

And so we saw some strong execution that you can see in our top line results. And then thirdly, you know, we've taken a very conservative number going into FY twenty six as we continue on because we have a large opportunity in front of us, not only with net new logos, but then also with our continued expand motion, with our continued product innovation that we've announced over the past couple of years at our key market events of NTAP Amplify.

Kevin McVeigh
Kevin McVeigh
Managing Director at UBS Group

Terrific. And then just a quick follow-up because obviously the incremental margins look really, really strong in 2026. How do we think about just with the mix in the enterprise, I would think maybe a little bit lesser margin. Maybe I'm not right on that, but just is it less professional services? Or just what's driving that leverage? Because just really, really strong margins as well.

David Morton
David Morton
CFO at Intapp

Yeah. We've continued to drive efficiency both in our model and our product offering. And so, again, how we've kind of brought items to market have been true value, that we've sold into our client base. And so as we've seen that continued leverage across all of those lines, we've continued to yield that, both, at the top as well as, below the line. And so, you know, enterprise, mid market, you know, those items are moderated, and, obviously, we're selling the value of that end prop versus, you know, just a simple solution set with a simple ASP.

Kevin McVeigh
Kevin McVeigh
Managing Director at UBS Group

Super helpful. Thanks again.

Operator

Your next question comes from the line of Koji Ikeda with Bank of America. Please proceed.

Koji Ikeda
Koji Ikeda
Director - Enterprise Software Equity Research at Bank of America

Hey guys, thanks so much for taking the questions. I wanted to ask a question on RPO. So when I punch in the RPO to the model, it looks like a pretty good growth quarter in the fourth quarter up 27% year over year. But when I look at total contribution for RPO for this year compared to last year, a little bit less this year versus last year. So just trying to understand if there's anything within RPO we should be thinking about or we're just kind of pulling teeth here on the numbers comparing fiscal twenty twenty five to 2024? Thank you.

David Morton
David Morton
CFO at Intapp

Yeah. I think you might be pulling some teeth as we finally have kind of crossed the chasm, if you will, on more material input from some of these enterprise clients. You know, our our total value, of duration hasn't really materially changed, from last year to this year. Clearly, we'll continue to, garner, that contract value that we'll recognize, but there wasn't anything both from a seasonality or contract duration that changed that.

Koji Ikeda
Koji Ikeda
Director - Enterprise Software Equity Research at Bank of America

Got it. That is super helpful. And maybe the follow-up question for you, David. You know, in the prepared remarks, thank you for giving the the the in the guidance, 10% of revenue coming from professional services for fiscal twenty six. But when I look at the license line item, is there anything we need to be aware of from a renewal seasonality that could create any sort of quarterly volatility or movement in that license line item specifically for 2026? Thank you.

David Morton
David Morton
CFO at Intapp

Yeah. We're we're gonna do our best to continue to keep everyone as transparent as possible as we work through. It's not a matter of if, it's just when we're able to get our clients transitioning, more aggressively to the cloud. And so there may be some puts and takes, you know, between q two and q three. But, clearly, for the year, we have our work, kind of identified, but there may be some quarter puts on that.

David Morton
David Morton
CFO at Intapp

So we'll make sure that we're very transparent as we go through this.

Koji Ikeda
Koji Ikeda
Director - Enterprise Software Equity Research at Bank of America

Thank you.

Operator

Your next question comes from the line of Alexey Gogolev with JPMorgan. Please go ahead.

Bella Camaj
Bella Camaj
Equity Research Analyst at JP Morgan

Hi, this is Bella on for Alexey. For our first question, can you explain the rationale behind your collaboration with Snowflake? What customer overlaps did you identify and how has early feedback been?

John Hall
John Hall
Chairman & CEO at Intapp

Sure. Thanks, Bella. We're excited about the growth in the partner ecosystem generally. Obviously, we've talked a lot about the Microsoft relationship. Snowflake was an important partnership for us to strike as we moved into the enterprise because they've made such a strong amount of progress there.

John Hall
John Hall
Chairman & CEO at Intapp

There's a lot of interest in the key information that we are helping to manage and collect and report on and analyze and then report back to all of the professionals who are working in the firms that stored in Intact DealCloud, in our compliance platform, in our collaboration system. And the clients really want to make that a central component of their overall business analysis. And the integration with Snowflake was a request that we began to receive pretty strongly as we started to win some of these large enterprise accounts. And we were very excited to be able to strike a formal agreement with Snowflake to ensure interoperability, and I think it is one more step for us in helping make sure that the enterprise firms see us increasingly as a key strategic pillar of their overall vertical solution.

Bella Camaj
Bella Camaj
Equity Research Analyst at JP Morgan

Thank you. That's helpful. And as a follow-up, with the upcoming QC one thousand accounting change, what opportunities do you see arising from this regulatory shift? And how much of that is currently baked into fiscal twenty twenty six guidance?

John Hall
John Hall
Chairman & CEO at Intapp

There's a lot of opportunity for us, I think, in the several of the regulatory changes, including QC 1,000. We talked a little bit about the Australia AML change that's happened as an example. And, actually, the compliance issues for this market generally have always driven the demand for a vertical specific solution. So the company's strategy throughout the technology generations generations from the on prem era to the mobile era to cloud and now AI, a key part of our differentiation versus the traditional horizontal systems is our understanding of the not just the workflows, but the compliance requirements of those workflows for these firms. And they really are looking for a strategic technology partner that understands those and can design for those so that they can put the best opportunity forward for their various regulators.

John Hall
John Hall
Chairman & CEO at Intapp

And this is just one more change. And as the accounting rules continue to evolve, the regulatory frameworks continue to evolve in each of the jurisdictions that we sell into, we're keeping up with that, and we're making sure that the firms can continue to trust us as the people who can now bring AI in a compliant way to the marketplace. It's a centerpiece of our differentiation and one of the reasons why you're seeing growth like this.

Bella Camaj
Bella Camaj
Equity Research Analyst at JP Morgan

Got it. That's really helpful. Thank you for taking our questions.

Operator

Your next question comes from the line of Parker Lane with Stifel. Please proceed.

Parker Lane
Parker Lane
Director at Stifel Financial Corp

Hey guys, good afternoon and thanks for taking the question. John, really nice to see 17 of the 20 large deals including a partner. I think you said partner influence bookings up 50 year over year. When you take a step back, how would you assess where you're at on the maturity curve of the co selling relationship with these partners? And do you characterize this as an inflection point that they will continue to support this durable growth?

Parker Lane
Parker Lane
Director at Stifel Financial Corp

Or is there still some enhancements you can do to even drive further performance there?

John Hall
John Hall
Chairman & CEO at Intapp

Well, there's always more to do. We are consciously recruiting partners strategically to help us address different aspects and different segments of the market of the whole solution. That being said, yes, we've been talking with you all for a few years now about our investment in the partner ecosystem. We wanted to consciously give you some statistics on this because this has been one of the questions. How is the partner ecosystem contributing to your growth?

John Hall
John Hall
Chairman & CEO at Intapp

And we've really reached a very important stage. We're not just, in each of the large deployments, but across the scale of our clients. We have partners working with us. You see it in the relative mix of services revenue in the model, working more and more with the ecosystem, and that's helping us on the sales side too. Because all of those partners who have relationships with their clients are referring us in and have an incentive to, sell with us and work on the deployments and taking care of customers after the the deployment.

John Hall
John Hall
Chairman & CEO at Intapp

Microsoft, in particular, we wanted to emphasize because such a big contribution to our large deals this time came from the Microsoft relationship that we've been cultivating for many years. And and this has been a question out there. So more than half of our clients are working with us and Microsoft together at the large end of the market, and just a little under half of the deals this quarter came that way. And we're seeing very strong support from Microsoft because the AI that we're delivering in a compliant way to this regulated market is a great way to pull Microsoft's technology and Azure into the marketplace. They see us as a key partner there.

John Hall
John Hall
Chairman & CEO at Intapp

And there are already existing MAC agreements with Microsoft at the large firms across the market. So that reduces our time to sale and makes the budget question less of a question because people have already committed to spending x with Microsoft each year, and they can use that now to buy our solutions. So the partnership is really working, and we're very excited about how that's going.

Parker Lane
Parker Lane
Director at Stifel Financial Corp

Got it. That's that's great feedback. And and the other thing you called out here was just a lot of AI enhancements across the platform, across the different sub verticals and verticals you you operate in. If you had to to look across the board, is there any one area that stands out above the rest in terms of AI adoption and utilization? Or is it truly a broad based demand you're seeing right now?

John Hall
John Hall
Chairman & CEO at Intapp

Well, you know, it's common experience how strong the AI story is generally in the industry. We're absolutely benefiting from that. I think one of the things that's happening is we're able to come in and show a vertical solution that is built into their workflows and a compliance solution and the relationship with their key technology platforms like Microsoft and Snowflake and some of the other things that we've been talking about. So people see a whole product there. And I think in the application space discussion, this front end of their problem, how can they apply AI to arm their professionals to better compete, pursue growth opportunities, identify, originate new business, bring that on board, and keep the revenue stream running.

John Hall
John Hall
Chairman & CEO at Intapp

This is an angle that is not what you hear from a lot of the AI startups. It's something we're in a unique position to deploy AI to solve for given our history with YieldCloud and with our intake and conflict solutions around business acceptance. And it's actually the thing that the very most senior people in the firms are trying to figure out how do I use AI to drive growth for my firm. So I think we're well positioned to tap into a confluence of top priorities for the firm here, not just AI itself, but AI for growth and compliant AI for growth. That mix is just awesome, and people are really responding well.

Parker Lane
Parker Lane
Director at Stifel Financial Corp

Makes sense. Thanks for the feedback again, John.

Operator

Your next question comes from the line of Alex Sklar with Raymond James. Please go ahead.

Alexander Sklar
Alexander Sklar
Vice President at Raymond James Financial

Great. Thank you. John, on the fourth quarter bookings improvement, can you just help break down how much of that you saw from any sort of macro improvement versus productivity just with more time in market with the strategic account team changes you put into place at the start of the year? And, Dave, just a quick follow-up for you. Any quantification on what term sheet added to ARR in the quarter?

John Hall
John Hall
Chairman & CEO at Intapp

Sure. Thanks, Alex. So there's a healthy demand for our solutions and for AI in the marketplace. Macro wise, we're seeing positive draw. On the productivity point, I do think that our continued evolution in a very measured and data driven way towards originally the strategic accounts pilot in fiscal twenty four, then the increase to the enterprise go to market organization in '25 absolutely contributed to a bunch of these numbers.

John Hall
John Hall
Chairman & CEO at Intapp

70% of our SAM is in the top 2,000 accounts. And so our emphasis of evolving our go to market more and more towards these top 2,000 accounts in our in our enterprise group is a conscious effort. We're investing a little bit more here in q one to get that group now off and running with a bigger sales kickoff and armed with more training and support to continue to build on the very strong funnel that we're seeing. So I think it's both a mix. Strong demand, clearly AI is a pull, and they gave some stats about how that's making its way through our pipeline strongly since the two launches at, Intept Amplify last February and this February, and then the enterprise shift as well.

John Hall
John Hall
Chairman & CEO at Intapp

So all of those things are adding together, and then I've already mentioned the Microsoft relationship and how that's supporting us in the field.

Operator

Your next question comes from the line of Terry Tillman with Truist Securities. Please proceed.

Terry Tillman
Terry Tillman
Managing Director at Truist Securities

Yes. Good afternoon, John, Dave and David. Congrats on the quarter. I had two questions. The first one actually just kind of building on top of the question and your answer, John, as it relates to front end loading some investment sales kickoff, etcetera.

Terry Tillman
Terry Tillman
Managing Director at Truist Securities

You all made good progress with this enterprise sales team build out. Is it more on just marketing, kind of branding and just investments in the event? Or are you actually adding more sellers now as you've gotten enough good signals with the enterprise sales motion? The second part of this first question is, these increased investments in the beginning of the year, do you all see potential payoff from those investments, maybe later in the year on Cloud ARR? And then I had a follow-up.

John Hall
John Hall
Chairman & CEO at Intapp

Thanks, Terry. So from an organizational standpoint, yes, it's bringing the sales team together, but really taking the lessons from the 2425 experience and making sure that all of the team members are armed with the best learnings about how to be successful out there. We've had some really incredible wins here. I wanna make sure that everybody has the knowledge and the training to support that. In addition, yes, we are making some increases in that enterprise force.

John Hall
John Hall
Chairman & CEO at Intapp

We think there's a real opportunity to continue to grow and and scale there.

Terry Tillman
Terry Tillman
Managing Director at Truist Securities

It. Thanks, John. And and Yeah. Sorry about that. Go ahead. Sorry about that.

David Morton
David Morton
CFO at Intapp

No. Go ahead, Terry. What was your follow-up?

Terry Tillman
Terry Tillman
Managing Director at Truist Securities

Okay. Yeah. Yeah. The follow-up question is, just related to, you know, I get a lot of questions over time around, you know, the kind of the the longer standing part of the business in the legal industry serving law firms. And just knowing the penetration y'all have had, you you did talk about, you know, kind of whether it's the assist the AI product around assist.

Terry Tillman
Terry Tillman
Managing Director at Truist Securities

But just in terms of DealCloud, like penetration and attach rate, how's that progressing on the legal side? And just how do you see in terms of the vitality of kind of the the law firm legal side of your business? Thank you.

John Hall
John Hall
Chairman & CEO at Intapp

Yeah. This was a core strategy for the deal cloud combination years ago. We did a lot of work. We've talked to you all over the years about blueprints and specific workflow definitions and some terminology change, data change, and some data integration we needed to do. All of that is paying off.

John Hall
John Hall
Chairman & CEO at Intapp

So we've got successful clients rolling out DealCloud as their business development system at small, medium, and large law firms. We have Intap Assist now as a key value proposition in that story, which is being taken up very positively. I gave some examples. We also, as you recall, we did a lot of work on our relationship intelligence system, which is an AI component of the platform that helps the partners in the firm navigate with each other to more client opportunities out in the world in a way that is really enthusiastically being received. So it took us a little while.

John Hall
John Hall
Chairman & CEO at Intapp

That's something that we've talked about. But a lot of these results, very positive. So I'm excited about the core concept, vertical compliant growth AI for these firms in a way that's really built for them. And we are announcing, I'm thrilled, replacements consistently now of traditional horizontal CRM systems that were not built for the industry with our vertical specific AI powered solution. And I think that that word-of-mouth continues to grow. So it's a great growth opportunity for us.

Terry Tillman
Terry Tillman
Managing Director at Truist Securities

Thank you.

Operator

Your next question comes from the line of Steve Enders with Citi. Please proceed.

Steve Enders
Steve Enders
Equity Research Analyst at Citigroup

Okay, great. Thanks for taking the questions here. I guess I want to follow-up on Alex's earlier question, but I guess what was the term sheet contribution in the quarter to ARR? And I guess on the backside of that, just as we think about kind of seasonality of ARR, does the shift to the account management structure, does that, I guess, maybe structurally change how we should think about linearity of ARR for the year? Or just kind of what are the factors that we should be, taking into account there?

David Morton
David Morton
CFO at Intapp

Oh, apologies. And I'm glad you reasked Alex's question. We got cut off there. Regards to term sheet altogether, they're integrating phenomenally both from a technology as well as hitting the deck running on landing some key new wins that I believe John articulated in his prepared remarks. As far as the overall contribution from your net ARR question, I would say it was relatively immaterial.

David Morton
David Morton
CFO at Intapp

When you'd say immaterial, it was less than 5%. And so, you know, we love what they're doing. We love the end client. We love the market that they're serving, and, you know, we really like how that pipe is developing for continued, contribution to overall NTAP here in this fiscal year. So hopefully, that addresses that question.

Steve Enders
Steve Enders
Equity Research Analyst at Citigroup

Yeah. Sorry. And just to to clarify, when you said it was five per or it's under 5%, you're talking to the total ARR of the net new ARR, in in the quarter?

David Morton
David Morton
CFO at Intapp

The incremental ARR from the cloud.

Steve Enders
Steve Enders
Equity Research Analyst at Citigroup

Okay. Gotcha. Perfect.

David Morton
David Morton
CFO at Intapp

Q four.

David Morton
David Morton
CFO at Intapp

How how how yeah. Q the delta between q three to q four is less than 5% of that delta.

Steve Enders
Steve Enders
Equity Research Analyst at Citigroup

Okay. Perfect. That's helpful context there. And then I guess just on the Microsoft partnership and that relationship, it feels like the commentary this quarter, I think, feels different from, I guess, the overall contribution or how it's impacting bookings. I guess, how are you kind of viewing the kind of further contribution for that or kind of you know, has the kind of the core groundwork been laid for that to now just kind of be, you know, harvest the fruit there?

Steve Enders
Steve Enders
Equity Research Analyst at Citigroup

Or is there or are there any kind of more, you know, hurdles or things that need to be worked through to to kind of, like, fully unlock the the the Microsoft relationship?

John Hall
John Hall
Chairman & CEO at Intapp

There's always more opportunity with an organization that size, but I think we hit some big milestones here. There were some important deals at the large end of the market that now both the Intept sellers and Microsoft sellers saw accomplishment of quota and quota release in that fiscal year. Interestingly, Microsoft's fiscal year is the same as ours, so they have it sort of to help get things done in June too. We saw some great results from the Mac agreements, which I think we're increasingly able to leverage in our sales motion earlier. People are getting more used to that and seeing the power that that could have to smooth making deals happen and take the budget question off the table and how do you navigate that in these enterprise sales motions.

John Hall
John Hall
Chairman & CEO at Intapp

I also think we've got more and more success stories that are traveling among the sales team and among clients by referrals about how to get AI in successfully this way. And I just think that the experience that we have working with their Salesforce, you know, they they made a change in addition to their financial services team. They put together under one executive of professional services sales organization, which includes legal, accounting, consulting. So we have an easier way to navigate the Microsoft go to market team now, and it's easier to get aligned. So a lot of things are aligning on the relationship there that are very exciting.

Steve Enders
Steve Enders
Equity Research Analyst at Citigroup

Okay. Perfect. Great to hear. Thanks for taking the questions.

Operator

Your next question comes from the line of Sasket Kalia with Barclays. Please proceed.

Saket Kalia
Saket Kalia
Managing Director at Barclays Capital

Okay, great. Hey guys, thanks taking my questions here. John, maybe for you, I'd love to just double click on term sheet a little bit. I think the size that we just heard there, and correct me here if my math is off, sounds like it was probably less than $2,000,000 in ARR, right? And I'm assuming that's the total ARR base that contributed in the quarter. And again, correct me if I'm wrong, think the size of the purchase price there was about $50,000,000 Maybe there's another $20,000,000 of earn outs possible. Can you just talk about how you kind of view that revenue opportunity long term with term sheet specifically?

John Hall
John Hall
Chairman & CEO at Intapp

So term sheet thanks, Saad. Term sheet is a component of our overall real asset solution strategy. We had already been making progress with DealCloud into certain parts of the RealAssets universe, specifically the fundraising that all the RealAssets investors were doing, very strong solution there. The coverage program that they use to look for opportunities in the marketplace, very strong solution there. As you would expect, a lot of overlap with our existing private equity style asset managers, the multi strategy asset managers that had both private equity and real assets investment strategies, and then increasingly the real assets specialists.

John Hall
John Hall
Chairman & CEO at Intapp

What term sheet brought us was an extension of additional functionality that looks at the deals after the funds are deployed into the deals and helps with asset management over the life of the asset. There's some specific requirements that those firms needed that the term sheet technology really helped us extend. And so to actually, together, we have an even better whole product than we had prior to the combination. In addition to that, there was a very strong AI first team in term sheet that are bringing a lot of horsepower to our growing engineering group that's focused on all the AI solutions we can bring out. And there's a great opportunity for us to leverage both the Real Assets expertise and even more of the AI expertise that we're bringing into the team.

John Hall
John Hall
Chairman & CEO at Intapp

So it's a great story. And the Real Assets market and industry, we talked a little bit about at Investor Day last year when we first went into it. This is a very significant space that is totally analogous, very closely related through the multistrategy asset managers that we serve to all the core businesses that we've pursued, and it's similarly similarly underserved. This is a vertical space that has not successfully taken up the horizontal systems for all the same reasons that our private equity and private credit, investment banking community has taken. So this just seems like the perfect TAM expansion and step for for us for continued growth here.

John Hall
John Hall
Chairman & CEO at Intapp

I think it'd be a big part of our business over time.

Saket Kalia
Saket Kalia
Managing Director at Barclays Capital

Got it. Got it. That sounds exciting. Maybe for my follow-up for you, how do you sort of think about the shape of net new ARR next year? Or are there any comments you want to make just on overall ARR growth as we sort of think about that versus revenue growth?

David Morton
David Morton
CFO at Intapp

From a shaping perspective, I think we started orienting folks around some implied seasonality. Definitely June and December quarters are gonna be, a little bit stronger just because of the natural follow through of where some of our end clients year end, reside and a renewal base already being, driven naturally in those two. And so, f q two and f q four are gonna be naturally higher. Now with that said, we're looking to every quarter to be successfully contributing to our growth and our aspirations as we look forward to our billion dollar revenue narrative. It was a very big year for us when you think about just our overall construct, finally breaking through the 500,000,000, finally generating well over a 100,000,000 in free cash flow.

David Morton
David Morton
CFO at Intapp

And so when you put all that into consideration and now you're starting to see some natural seasonality trends that flow, This is the next stage and evolution of the company as we exit '25 on to a successful '26.

Saket Kalia
Saket Kalia
Managing Director at Barclays Capital

Understood. Thank you.

Operator

Your next question comes from the line of Patrick Molley with Piper Sandler. Please go ahead.

Patrick Moley
Patrick Moley
Director & Senior Research Aanalyst at Piper Sandler Companies

Yes. Good evening. Thanks for taking the question. I was hoping to just get your updated thoughts on capital allocation priorities from here? And then with the share repurchase program announced today, just how you're thinking about the pace and timing of buybacks throughout the rest of this fiscal year?

David Morton
David Morton
CFO at Intapp

Patrick, nice to formally meet you. Welcome to the NTAP team account coverage. Yeah. Thanks for asking on the share authorization. You know, clearly, we didn't necessarily wanna commingle our strong results coming off our q four and the importance of our '26 guide, But the Board has authorized us $150,000,000 in share repurchases.

David Morton
David Morton
CFO at Intapp

The way we think about things here is we're going to continue to invest in ourselves. There's a lot to be done within our, product, road map, with AI and the opportunities that we see for our end clients. Secondly, some of the previous questions have evolved around term sheet or recent acquisition. So we clearly have a profile there of key items that, may be fitting within our own, I'll call it, persona of an acquisition, target and that funneling. And then thirdly, we now have this authorization to take every opportunity to put capital at work when we deem fit. And so it's as pretty straightforward as that.

Patrick Moley
Patrick Moley
Director & Senior Research Aanalyst at Piper Sandler Companies

All right. Great. And thank you for the kind words. Looking forward to working with you.

Operator

Thank you. And that concludes our question and answer session. And I will turn it back to John Hall for final comments.

John Hall
John Hall
Chairman & CEO at Intapp

Okay. Thank you everyone. We have a very strong fiscal twenty twenty five behind us and I am very excited about fiscal twenty six and the opportunities in front of us. The team is off and running, and we're very excited to look forward to talking to you again in ninety days to talk about q one. Thanks for your time today.

Operator

Thank you. And with that, we conclude our program for today. We thank you for participating and you may now disconnect.

Executives
    • David Trone
      David Trone
      SVP - IR
    • John Hall
      John Hall
      Chairman & CEO
    • David Morton
      David Morton
      CFO
Analysts
Powered by Quartr