GLOO

Thank you for standing by, and welcome to the Gloo Holdings Fiscal Q4 2025 Earnings Conference Call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star one one on your telephone.

If your question has been answered and you'd like to remove yourself from the queue, simply press star one one again. We ask that you please limit yourselves to one question and one follow-up. As a reminder, today's program is being recorded. Now I'd like to introduce your host for today's program, Oliver Roll, Chief Marketing & Communications Officer. Please go ahead, sir.

Thank you, operator. Thank you to all of you for joining our fiscal Q4 and full year 2025 earnings conference call. We'll be discussing Gloo's performance for the Q4 ended January the 31st 2026, as well as our results for the full year 2025. We'll also be providing guidance for our Q1 and full year 2026. Joining me on today's call, our 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 which are based on Gloo's current expectations, but which are subject to risks and uncertainties relating to future events and/or the future financial performance of Gloo. 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 elsewhere in our filings with the Securities and Exchange Commission, including our prospectus dated November 18th, 2025, and our annual report on Form 10-K that we expect to file later this week. 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'll discuss certain non-GAAP financial measures. 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 in our Form 10-K. Now I'll turn the call over to Scott.

Thank you, Oliver. Thank you for joining our 2025 Q4 and year-end earnings call. Q4 was a strong quarter for Gloo that exceeded our guidance and capped a strong year in 2025, our 1st year as a public company. In Q4 2025, we more than quadrupled our revenue compared to the prior year period. We also exited 2025 with a much stronger balance sheet following our November IPO and the conversion of a significant majority of our debt into equity. We're also making good progress toward Adjusted EBITDA profitability, as reflected in our Q1 guidance of more than 30% improvement in Adjusted EBITDA from Q4. We remain confident in achieving Adjusted EBITDA profitability in Q4 2026, and continue to expect to approach Adjusted EBITDA profitability in Q3.

These results and our confidence in the future reflect the unique value that we are delivering against two mission-critical needs across the faith and flourishing ecosystem, the need to modernize technology and the need to expand reach. Our growth is driven organically as well as through continued expansion from accretive strategic acquisitions that strengthen our platform. Before I go deeper into our strategy, I want to briefly revisit the ecosystem that we serve, because that context is important to understanding both our opportunity and our results. Gloo is building the leading technology platform for the faith and flourishing ecosystem.

This is one of the oldest and largest sectors in the world, yet one that remains highly fragmented and materially underserved by modern technology. At the center of this ecosystem are two interconnected groups. 1st are churches and frontline organizations, or CFLs, which serve people and communities directly.

The 2nd are network capability providers, or NCPs, which equip them with the tools, services, resources, and infrastructure that they need to succeed. At the heart of the ecosystem, we also see 2 mission-critical and unmet needs. 1 is the need to modernize technology, including systems, data, workflows, and core operating infrastructures. The other is the need to expand reach, deepen engagement, and increase donor support in more effective and scalable ways. The Gloo platform is built to address those needs through 2 core areas of focus, Powering Technology and Powering Reach.

Our solutions that power tech help organizations modernize their operations and build the foundation required to adopt new technologies effectively. Our solutions that power reach help organizations expand awareness, strengthen engagement, and grow support through differentiated marketing, media, and fundraising. Underpinning everything is the company's growing leadership in applied AI.

We're leveraging the latest innovations in agentic AI, foundational models, and services from top AI companies. We're combining that with the AI advancements across our own platform. As part of this strategy, we're taking over more of our customers' work that can now be executed by AI. We take over a customer's technology operations, we modernize them, and then we apply agentic AI to deliver significantly better outcomes at lower costs, while also creating higher margins for Gloo and highly durable revenue streams.

This allows AI to be uniquely applied to the real operations, workflows, and mission-critical activities of churches, ministries, and not-for-profits in ways that protect theological integrity, strengthen relational ministry, and advance human flourishing. This approach is supported by forward-deployed engineers, similar to the models used by Palantir. We understand customer operations and build tailored agentic solutions that create meaningful, repeatable value.

Over time, we believe that expands our opportunity well beyond software spend into the much larger labor budgets that sit behind it. We believe Gloo is uniquely positioned to lead applied AI in the faith and flourishing ecosystem by helping customers harness those capabilities in practical, mission-aligned ways. I now want to turn to our broader platform strategy and how we continue to strengthen it over time. As the platform expands, it benefits from a powerful flywheel effect.

Each new capability, solution, and network capability provider makes the platform even more valuable to the churches and the frontline organizations that we serve. As more of these organizations engage, the platform becomes more valuable to the network capability providers and the partners serving them. Strategic acquisitions are a key part of strengthening that flywheel, enhancing our ability to Power Tech and Power Reach for our customers.

Earlier today, we announced our latest example of that flywheel in action. Today, we announced the definitive agreement to acquire Enterprise MarketDesk, known as EMD, a leading Workday service partner that provides consulting, implementation, and operating services to small and mid-sized organizations and not-for-profits. This is an important addition to our solutions for Powering Tech. Workday is a leading ERP platform in the faith and flourishing ecosystem, and often the preferred solution for many of the Gloo enterprise customers, creating clear synergies between the 2 companies.

EMD offers a full suite of services, including Workday deployments, application management services, and staff augmentation. This strengthens the Gloo 360 value proposition and expands our ability to help customers modernize core systems and transform IT in more strategic ways through our applied AI.

This aligns with our core strategy of taking over and modernizing the work of an organization, using forward-deployed engineers, then applying agentic AI, thereby delivering better results at lower cost, while at the same time creating higher margins for Gloo. Workday offers a major set of capabilities that we see many of the organizations in the faith and flourishing ecosystem using more often. Workday implementations are long-cycle engagements that will lead to larger digital transformation mandates that Gloo 360 is uniquely able to support. In addition, we successfully completed the acquisition of Westfall Group during the quarter.

Westfall is a leading platform for major donor engagement in the faith and flourishing ecosystem. Its addition has expanded our donor development capabilities and strengthened the strategic fit and synergies with Masterworks, which we acquired in 2025.

Together, these moves reflect our disciplined approach of adding best-in-class network capability providers as Gloo capital partners, strengthening the platform and reinforcing the flywheel. Westfall Group has been immediately accretive since close, and we anticipate EMD will be immediately accretive upon close as well. Now, let me turn back to the importance of AI to our strategy. Underpinning everything we do is our growing leadership in applied AI. Our applied AI strategy is focused on three areas.

1st, we're building the core AI capabilities we believe the ecosystem needs, including agents, values-aligned AI, unified data infrastructures, and trusted chat-based interfaces. 2nd, we're embedding AI across our solutions to improve automation, personalization, data integration, and overall customer outcomes.

3rd, we're helping both our customers and Gloo itself put AI agents to work and evolve toward more agentic operating models so that the ecosystem can focus more time, energy, and resources on mission. We believe this strengthens our platform, accelerates innovation across our portfolio, and reinforces our leadership in applied AI for the faith and flourishing ecosystem. Let's turn to customer momentum. We're seeing strong customer momentum across our portfolio.

We continue to close larger strategic deals with two customers now expanding to almost $10 million of annual revenue. We also closed several agreements valued at more than $1 million, including an exciting expansion in the university segment through our work with Jessup University. This is the 1st example of us bringing the full breadth of the Gloo platform to a large university, and it's a strong validation of the value that we can provide this very large market segment.

We also announced a new strategic technology partnership with InterVarsity Christian Fellowship/USA, with Gloo 360 powering its enterprise technology operations. That will enable InterVarsity to spend less time managing systems and more time engaging students and faculty across more than 700 campuses in the United States. It's a strong example of how by powering their technology, we can help organizations modernize operations while increasing mission impact. Separately, we also expanded our partnership with YouVersion in Brazil, establishing a co-located engineering presence alongside their regional hub to strengthen the cultural alignment with their team while building engineering capacity in the region.

In a moment, Paul will take you through our guidance for Q1 and the year ahead. We remain super confident in our strategy and our outlook for 2026.

Our confidence reflects the strength of the platform that we're building, the flywheels that continue to strengthen as we scale, and the momentum that we're seeing across the business. It also reflects the role AI is increasingly playing as an accelerator across both Powering Tech and our Powering Reach solutions. We believe our AI is unlocking enormous possibilities for ministries, churches, and network capability providers to grow their reach and to expand their impact. Our focus on applied AI and bringing agentic workflows into the faith and flourishing ecosystem in practical mission-aligned ways uniquely positions us to capture that opportunity.

Taken together, that gives us confidence in our guidance, our path to profitability, and the long-term value that we believe we are delivering to our customers and to our shareholders. Paul, over to you to talk about our numbers in more detail.

Thank you, Scott. Our Q4 2025 results were strong, with revenue beating our guidance and Adjusted EBITDA at the upper end of our guidance range, giving us solid momentum as we ended the year. Revenue for the quarter was $33.6 million, an increase of 418% compared to the same period last year, and 3.3% sequential growth compared to Q3, which is good performance given the seasonality characteristics of our industry. Year-over-year results were driven by solid organic growth across our portfolio, as well as the acquisitions of several capital partner businesses, most notably Masterworks and Midwestern. Platform revenue totaled $20.1 million, an increase of $13.8 million from Q4 of last year and 1.6% sequential growth. As a reminder, Platform revenue includes advertising, marketplace, and subscription offerings.

Much of this sequential growth was driven by Gloo 360 and Igniter, partially offset by some Masterworks advertising revenue that shifted into Q3, as we previously discussed. Platform solutions revenue was $13.5 million, up 6% sequentially, supported by strong performance from Barna and the addition of Westfall Group. Going forward, Westfall's donor events and design business will primarily contribute to platform solutions revenue and, together with Masterworks, will strengthen our solutions for Powering Reach by supporting customers' fundraising throughout the year and around key events. Cost of revenue in the quarter was 76.5%, an improvement from 83.4% in the prior year period.

That improvement was driven by growth in higher-margin business lines and improved pricing in some areas. We expect improvement to continue throughout the year. Adjusted EBITDA improved $0.7 million sequentially to -$18.6 million.

This improvement reflects incremental gains across nearly all of our Gloo businesses and capital partners and includes acquisition costs related to the Westfall Group acquisition, which we do not adjust out. Westfall did not contribute to Adjusted EBITDA, as January is seasonally slower for fundraising activity. There are also 2 important non-cash items to note that significantly reduced net income in the quarter. 1st, share-based compensation was higher than normal due to non-recurring IPO-related award activity, as noted in our Q3 10-Q.

2nd, the line item loss from the change in fair value of financial instruments reflects derivative calculations affected by our share price. If our price declines in a quarter, we will generally record a loss in this line, and if our share price increases in a quarter, we will generally record a gain. In Q4, this number pressured net income and therefore EPS.

As of January 31st, 2026, we had $57.3 million of cash and cash equivalents. I'd like to now turn to our Q1 and full year 2026 outlook. As Scott mentioned, we continue to guide to Q1 revenue of $36 million. For the quarter, we expect Adjusted EBITDA loss to narrow to -$12 million, representing more than $6 million of sequential improvement as we grow revenue, improve cost of revenue, and continue to aggressively manage operating expenses.

We remain focused on progressing towards Adjusted EBITDA profitability in Q4. Our full year 2026 revenue outlook is now $190 million, which includes the addition of EMD. While we continue to see M&A opportunities, we are confident in our ability to achieve this guidance without any additional acquisitions. As we move through 2026, we continue to expect meaningful sequential improvement each quarter and expect profitability in Q4 2026.

For Q1, we expect a weighted average share count of approximately 80 million shares. Looking ahead, we're excited about scaling the business and applying Gloo AI internally as we become more efficient, and using it externally to help customers better serve their constituents. With that, back to you, Scott.

Thanks, Paul. With that, Operator, we're ready to take the 1st question.

Certainly. As a reminder, ladies and gentlemen, if you do have a question at this time, please press star 1 1 on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star 1 1 again. One moment for our 1st question. Our 1st question comes from the line of Richard Baldry from Roth Capital. Your question, please.

Thanks. You probably don't want to name them, but I'm curious if you can maybe just broadly describe the two customers that are nearing $10 million a year in revenue, and maybe how replicable that could be across the total addressable market you're looking at.

Yeah. Thank you. This is Pat. We see that these customers are now taking more of the different offerings of Gloo, and that's part of what's making these accounts larger, right, is that they're Masterworks, Westfall Gold, Gloo 360 AI customers, so that as we're aggregating more of those capabilities, these account relationships are becoming very large.

Obviously, these are some of the larger customers in the ecosystem, but we continue to win more customers at the $1 million level. A number of those are maturing to be multi-million customers. We do see that these are very large customers in the ecosystem, so we do think they're replicable to having more customers get to that level of relationship.

Overall, the key point is that these are big accounts and we're establishing big trust and deep, enduring relationships with them across an increasing breadth of the portfolio of our offerings.

Maybe you addressed it a little bit, but can you talk about sort of the funnel for million-dollar plus deals, how that's changing now that you're a public entity with sort of greater visibility, how that's changed as you've rapidly scaled the portfolio and your revenues? Is that pipeline sort of picking up because of the capabilities you have now?

Yeah, I'll say there's probably 3 aspects to the pipeline to just highlight. The one is, it is just getting bigger, right? The more we're building our sales capacity, we're seeing more accounts that we're engaging with. More salespeople have reference accounts that they can, secondly, move horizontally, and that's one of the things that's exciting. We do see that we're able to move to other customers in that segment. We're able to land and expand within an account. We're able to land and expand within the segment. We're also seeing the sales cycle, if anything, shorten.

That's probably maybe the most exciting aspect of the growing momentum in sales, that the more reference accounts that we have, the more we're able to then replicate that into other segments.

Like we saw this quarter, we closed our 1st major multi-offering university, and we expect that we'll have many other universities that we'll be able to replicate that kind of sales motion with. With InterVarsity, one of the reference customers, the campus ministry segment is showing replicability as well. It really is a very positive aspect to the business. As the accounts get bigger, we're able to see the sales funnel increase and the acceleration in those accounts as well.

Switching gears, if we look at the AI part of the business, can you talk about how far into it you feel you are in terms of rolling out products and services based upon it, and then maybe second stage, how far you're into adopting internally tools for efficiency purposes operationally? Thanks.

Yeah. Maybe I'll start and ask Scott to add to this one. The first would be is, I see AI overall in the 1st inning, period, for the industry writ large. There's a lot to go. For most of our accounts, we're even earlier than the 1st inning, right? We're just getting started because in many cases, we're just starting the 360 engagement.

We're about to turn on some of the first agentic capabilities. I'll say this is very early, and we see tremendous opportunity to build on those offerings for the accounts. Internally, we're further along, and we have more of our internal businesses, our capital partners, taking advantage of our AI and our capabilities today. We're using it across many different aspects of our business today.

Again, we see a lot more opportunity, which will only improve our speed of operation and the margin of the business. This idea of applied AI is one that we really believe that we can be operating in that space for many, many years to come because the market is large, the customer needs are large, the gap in technology is large, and the benefits of AI, and particularly this idea of agentic applied AI, that it's not just addressing how to do things better, but it's also literally turning people and manual processes into service offerings in the future. This is something we think is an industry trend and one we're uniquely applying to this segment of the market. Scott?

Yeah. Thanks, Pat. Yeah. Rich, in addition to that, AI is actually driving a lot of demand for Gloo 360. It's one of the reasons that we're seeing these bigger deals come in, because it's just now gotten to the point with keeping up with technology for ministries where their primary job is not to be a technology company. Their primary job is to go out and do mission, to translate Bibles, to work on campuses, to be able to help people in their communities.

Now all of a sudden that AI has come on the scene, it's just accelerated the reality of not being able to fully keep up. Us being able to show up and to be able to help them with that is, I think, a big driver for overall demand.

Now, as I stick with 360 for a second, in addition, what we've been able to do is pull work out of these different organizations, literally pull the SaaS technologies as well as the people out of the organizations, being able to help that move to a whole next level, and then applying AI to that to be able to deliver better results to the organizations that we're serving at a lower cost, and then being able to keep applying the AI to that, which allows us to be able to improve margins, and pass that along to the rest of the system.

There's a lot happening there. We also announced this quarter, or just this last month, Gloo AI Studio. Pat, you can just chime in for finishing up here, but really providing developers infrastructures that can be used beyond Gloo.

Yeah. Just to add to that, we just finished Missional AI, a major AI conference for the faith and flourishing industry. At it, we announced Studio AI, now a full set of API services, pay-for services. We have a growing set of developers now taking advantage of that because we really see part of our mission is not just what we do in our offerings, but enabling a broad ecosystem to build on the foundational capabilities that Gloo AI provides.

Maybe last for me, could you just generally discuss the M&A environment? Sort of curious how it's impacting the faith and flourishing world. It's obviously been valuation pretty depressed in the open market as people are fearful about the disruptions of generative AI. Sort of if you can walk through a backdrop of that'd be helpful. Thanks.

Sure. I'll take that. It basically goes back to what I was just talking about. AI, from our standpoint, is definitely a friend in that entire process.

As the SaaS tools out there, big system of record tools, for us to be able to take on those tools, to be able to integrate with them, to be able to build workflows, AI-powered agentic workflows on top of those historical infrastructures, whether it's a church management system in a church or whether it's a Salesforce or a Workday in some of these big enterprise customers, our ability to basically build the workflows on top of that and then to be able to power that back into the ecosystem, that's just a great thing for us. We don't see ourselves being negatively impacted at all as a result of some of the conversations around SaaS.

In fact, we see it as basically being able to further power our business and power our strategy.

Thanks. Congrats on a great quarter and a great outlook.

Thanks, Rich.

Thank you. Our next question comes from the line of Yun Kim from Loop Capital. Your question, please.

All right. Congrats on the quarter, Scott, Paul, and Pat, and also on the EMD acquisition announcement. 1st, maybe Paul can answer this, but obviously Gloo 360 is doing very well. Is scaling that business a key driver behind your margin improvement this year, or is there other part of your business that's even bigger margin driver than Gloo 360?

Gloo 360 is definitely key each quarter. It steps up incrementally, both on the growth side and on the margin side. It's a big contributing factor along with AI rolled into that. I'd say those are number one and number two together.

Okay. On the EMD, any additional details you want to share with us, like the revenue run rate and then also the margin profile?

Yeah. Just a few things on EMD to start with. Overall, we just have seen, and part of what motivated us to do this acquisition was that Workday was already being well adopted by our ecosystem. In fact, some 40%+ and growing of 360 customers are already using Workday. We saw it as a great fit for our offerings and acceleration of what we're doing with areas like 360 already. Super great fit for that, and we see ourselves having these deep relationships with customers only enhanced.

Scott mentioned in his formal remarks, accretive from day one. We do see that as being beneficial to our journey. As we indicated at the beginning of the year, we saw a couple of M&A. We've now completed both of those, so we're very confident and raised our guidance as a result financially.

We're not giving specific size on the deal itself, revenue, but between this and Westfall Gold now being completed, we satisfied that portion of the growth that we had indicated of our inorganic growth for the year. Overall, we see great synergies as well. They were supplying many of the customers who we were already engaging with, so we do see synergy sales being a benefit to our ecosystem. Finally, this is a path for improving margins over time as we expand our unique relationship with Workday and the benefits that it brings to the ecosystem. This will only be more accretive over time as we get deeper and deeper on these key assets that provide value.

Finally, building our AI capabilities, as Scott already indicated before, will only enhance what we can do and use the unique capabilities, both of Workday and the broader capabilities of Gloo AI.

Okay, great. I just want to better understand the cross-sell opportunity with EMD. Is that primarily selling Workday and related services to your current install base, or is it more around converting certain customer segment of EMD to Gloo 360?

Yeah, it's actually quite a bit both because some of the accounts that were in the Gloo 360 pipeline were already being serviced by EMD. That's part of what got us actually quite excited because some of those accounts that we hadn't yet broken into are now becoming Gloo customers, and we expect that the land and expand opportunity as a result has only accelerated. We also see, because of their depth of capabilities, that we'll be introducing it into accounts where we already have activity, and now we'll have a much richer set of capabilities to accelerate Workday deployments into a number of Gloo accounts already.

Finally, EMD was servicing customers that weren't even in our pipeline today. We do see some market expansion opportunity for us. I'll say it's yes, and yes, for the synergy opportunities.

Just lastly on Gloo AI Studio, I know you already mentioned it. Is that targeted at customers wanting to customize their Gloo AI solutions? Is that a precursor to potentially opening up your platform and maybe getting into the partner ecosystem where try to develop an ISV ecosystem?

Yeah, we unquestionably see this as building an ecosystem of developers that are aligned with faith and flourishing. Some of the accounts that were already doing these type of AI app development, and they might be looking at whether they would want to do that on Anthropic or Google or Amazon or Microsoft. Well, we offer all of those models through the Gloo AI Studio, but we add guardrails, protections, and testing to validate that it meets the values and expectations of these customers.

Those are part of what the Gloo AI Studio provides. We're finding increasing resonance from people that say, "Yeah, I want the best models that are there in the industry, but I also want them to be safe and trusted." That's the value that Gloo 360 is adding on top of enabling the best AI capabilities in the industry.

We expect that this ability for us to service big customers like YouVersion, and we're partnering with them on many AI builds, but a much broader set of customers as they want to build their own applications, but doing it with a trusted partner like Gloo.

Okay, great. Thank you so much.

Thank you. As a reminder, ladies and gentlemen, we do ask that you please limit yourself to one question and one follow-up. Our next question comes from the line of Matthew Harrigan from Benchmark. Your question, please.

Thank you. I'm curious what the reaction right out of the blocks is on Gloo AI Studio in terms of partners who have used it. In February, we saw this rapturous reaction to Sora in terms of the implications for the entertainment industry, and I imagine that's kind of an overreach comparison. Do you think the ease of use is good? Are people really interested? Are people getting utility out of it right away?

Super early, and I'm sure in a quarter or 2 when we've been in market for more than just a couple of weeks, we're going to have a much better signal. The response so far is we're getting emails that people who are using other people's platforms and tools, very excited to move their apps over on top of Gloo AI Studio. We definitely have some early positive anecdotal signals that give us a lot of confidence. We're also coming into developer season for Gloo, right? We just had Missional AI, and we launched Studio just in front of that on purpose.

We have a virtual developer event over the summer, and then we have our big hackathon in the fall. About every two months, we have a major developer event over the next four months.

It's going to be an exciting time for us to build that momentum. We're measuring the results on this on a daily, weekly basis as we're starting to see token count rising, API calls, revenues start to materialize, just the beginning of an exciting new capability for Gloo.

Since we have kind of a two-headed monster here between myself and Dan, a question from Dan. When you add these capabilities, and clearly you're getting a lot more pull demand as you get more awareness in the marketplace, when you look at the sales cycle, when you get a big contract in a given vertical, does the next win come pretty quickly in a tighter sales cycle? Are people looking to emulate what other guys are doing, and they don't want to be left behind in a certain sense in terms of the implementation of the software and the AI capabilities that you offer?

Yeah. We're definitely seeing that, and that's very much what I was trying to indicate earlier, that we're able to see the sales cycle close, particularly for the next account within a segment, right? As we saw with InterVarsity this quarter, it was in the same segment where we also had other activities with campus ministries. We do expect that we'll see very similar within the university segment. When we have reference accounts, we're able to move across those segments quite effectively. It's land, expand, and expand. Expand in the segment, expand the offerings from Gloo as we build more of our capabilities for those customers. Overall, I'll say the sales cycle and having led major software and SaaS sales models, how rapidly we're able to convert accounts is really pretty impressive so far.

I rather suspect that sales number is going to be light. You won't refrain from more M&A activity. Congratulations. Lots of momentum. Thanks.

Thank you.

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

Great. Thank you, guys. I'll echo my congrats on the quarter. I wanted to maybe start on the M&A front. We went into the year expecting a couple of deals and kind of a defined revenue contribution. You've done a couple of deals. It seems like we're in the vicinity of that revenue contribution. Just curious, we're pretty early in fiscal 2026 yet. What are your thoughts on other M&A opportunities that might present themselves over the duration of the year?

Yeah. Thanks, Jason. We've got a significant pipeline from an acquisition standpoint. However, we've been really focused on getting the synergies out of the current transactions that we've done. That's been a big focus of us so far this year, and it's going to be a really important driver to getting to that EBITDA profitability by Q4. That being said, we do have a pretty significant pipeline. We will be super disciplined as a result of that. There may be more this year, but we need no more to be able to hit the numbers that we've got for guidance, and we need no more to be able to get to the EBITDA profitability. We've had the good fortune of being able to do best in breed for this ecosystem. We've been very picky in terms of the transactions that we've entered into.

A great example is the work that we did last year as a result of Masterworks and the great boost that that's been able to give us in terms of massive synergy across the reach. As Paul was talking about a little bit earlier in terms of the organic growth from 360 and the improvement in the margins from 360, we're seeing the same thing in Masterworks. One is Powering Tech, the other one is Powering Reach. We can continue to be very disciplined as the year goes forward, even though we do have a good pipeline.

Thanks, Scott. I want to build on that. You're seeing more profitability flow earlier in the model than we anticipated. Nice guide in terms of improvement for Q1. You're moving forward that profitability for FY 2026.

Maybe just talk about the drivers there. Are you finding you don't need as much OpEx as you thought, or is it more a product of the revenue outperformance and getting scale there? Just any way to define it would be great. Thanks.

Great question, Jason. It's a combination of both. First of all, as we talked about or announced in December, we took a look at our cost structure, removed some redundancies there, and that flows through Q1 as it begins to hit, which helped our guide and the incremental EBITDA improvements. Secondly, the businesses are scaling really nicely across everything we talked about, Reach, Tech, Masterworks, 360, all the different businesses. As those take steps each quarter, you start to see it in Q1, and then each incremental one going forward as we work towards Adjusted EBITDA profitability in the Q4.

Yeah, I'd jump in and add, just a lot of operating discipline as well, which we're excited about. We couldn't be more proud of our capital partners, the organizations that we've made investments in, and the organizations that we've acquired. It's just like the leadership have stayed. They're invigorated. We're bringing synergies to the table in terms of on technology and in terms of cross-selling and channel. The capital partners are doing great. It's super exciting to see the synergy that's coming from that, the enthusiasm that continues to be there, and we're super grateful for them.

That's great to hear. Thank you, guys.

Thank you. Our next question comes from the line of Ryan Meyers from Lake Street Capital Markets. Your question please.

Hey, guys. Thanks for taking my questions today. I guess the 1st question, are there any material cost pressures or risks we should be aware of in fiscal year 2026?

I don't think anything significant that we haven't talked about before that's not normal. Nothing stands out in terms of cost pressures.

Got you. I know you don't disclose the actual number, but are you seeing more of the revenue base becoming recurring, or how is that shaping up?

Yeah, as you look at the work that we're doing with Gloo 360, as you look at the work that we're doing with Masterworks, more and more of that is just locked in recurring revenue. I just love what we've been doing in terms of this idea of taking over work. There's been some really good commentary on that as well. Recently, there's been an article, some research published by Julien Bek, a Partner at Sequoia. The title of that is "Service Is The New Software." What he's pointing out there is a little bit of the older model was sell tools in and let people do work on top of those tools. Whereas at this point, what you're able to do is actually pull work out.

When you pull those tools and you pull that work out, then you're able to sell that work back into the organizations. Well, not only is it much bigger because you got the tools revenue and you've got the work revenue, you got that labor revenue on top of it, but it is incredibly sticky, right? It's very, very durable, which we like to see. He makes a quote that says, "A company might spend $10,000 on QuickBooks and $120,000 on the accountant to close the books.

The next legendary company will just close the books." Right? That's really what we're focused on with a lot of what we're doing, not just at 360, but also at Masterworks, where we're forward deploying people into those organizations.

We're pulling work out of those organizations, being able to deliver them better results at a lower cost, being able to then set ourselves up for really good long-term relationships, very recurring in their nature, and then really freeing them up to be able to focus more of their energy on going out and chasing and scaling their mission, which is what it's all about at the end of the day. It's about helping those organizations help people flourish, help communities flourish, and be able to enable those organizations to thrive.

All of that then becomes more recurring by its very nature. Even if some of that you think of as a service, it is a very deeply embedded long-term agreement that delivers services or work back into those organizations.

Yeah, that sounds awesome. Thanks for answering my questions.

Yep.

Thank you. This does conclude the question and answer session of today's program. I'd like to hand the program back to Scott Beck, Co-Founder and CEO, for any further remarks.

Yeah, thanks a lot. Let me start by saying I couldn't be more excited by where we're at today. We've been on a long journey here. We've spent more than a decade building the foundation for this business, investing in the platform, in the trusted relationships, and in the mission that continues to guide our work. Today, I believe that Gloo is better positioned than ever as the leading technology platform for this ecosystem and as the leader in applied AI for this ecosystem. All of this is pointed toward being able to use technology as a force for good. Our aim has always been that, and it's just we've made tremendous progress toward that. Also, super thankful, I just got to say, we're super thankful for the organizations that trust us with that. We do this wholly imperfectly, right? We're getting better every day.

They trust us with it, they journey with us on it, and we're super grateful for that. We're also thankful for the team, for our capital partners, I talked about them earlier, as well as the investors. We've got a lot of investors that got us to this point and new investors that are on the journey. With all of this, our goal remains really clear, to build a large, profitable, mission-driven business that serves those who served. We're committed to doing that with discipline, transparency, and a focus on long-term value creation for our shareholders, but also for the customers that we serve.

Personally, I thank God for the opportunity to be able to serve this ecosystem, to best ensure that the organizations can thrive, and so that they can go into their communities, they can work with the people, and help them flourish to become all that they're born to be. Thank you all for taking time today to listen to our call. As always, we remain available to answer questions. Feel free to reach out at any time. With that, Operator, that concludes our time.

Thank you. Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.

Good day, and thank you for standing by. Welcome to the Gloo Fiscal Third Quarter 2025 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to turn the conference over to Oliver Roll, Chief Marketing and Communications Officer. Please go ahead.

Thank you, operator. And thank you to all of you for joining our fiscal third quarter 2025 earnings conference call. We will be discussing Gloo's performance for the third quarter ended October 31 2025, as well as providing guidance for the fiscal fourth quarter 2025 and fiscal year 2026. Joining me on today's call are CEO and Co-Founder, Scott Beck, and CFO, Paul Seamon. Our 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 which are based on Gloo's current expectations, but which are subject to risks and uncertainties relating to future events and/or the future financial performance of Gloo. 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 elsewhere in our filings with the Securities and Exchange Commission, including our Prospectus dated November 18, 2025 and our subsequent quarterly report on Form 10-Q that we expect to file later this week. Both will be 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. 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 in our Form 10-Q. And now, I will turn the call over to Scott.

Thanks Oliver, and thank you all for joining us today, for our first earnings call as a public company. Q3 has been a solid start to this next chapter of our journey. Revenue grew 432% year-over-year, and 101% compared to Q2. This reflects strong demand across our platform and meaningful growth through acquisitions that have strengthened our business and expanded our capabilities. We also delivered sequential adjusted EBITDA improvement. And we expect additional EBITDA improvement in Q4, and we expect the pace of that improvement to accelerate, beginning in Q1 2026. We are executing on our growth plan, and expect revenue in excess of $180 million in fiscal year 2026. Moreover, we are committed to achieving positive adjusted EBITDA by the end of Q4 2026. Because this is our first earnings call as a public company, I'd like to take a few minutes to provide an overview of Gloo, our mission, the value we deliver, and our strategy for long-term growth. Gloo is building the leading technology platform that connects and serves the faith and flourishing ecosystem. This ecosystem is one of the oldest, largest, and most resilient in the world, yet one that remains highly fragmented and significantly underserved by modern technology. Let me briefly describe the two core parts of this ecosystem. You will hear us refer to them often. First, there are churches and frontline organizations, actually there are more than 315,000 churches in the United States and over 100,000 other nonprofits organizations serving people and communities on critical social issues, such as recovery, anti-human trafficking and many more. Second, there are Network Capability Providers, the organizations that develop the tech, content, solutions and services that equip those churches and the frontline practitioners. Importantly, Gloo serves both sides of this ecosystem. The Gloo platform includes technology infrastructure, advertising tech, marketing services, and consulting solutions. Gloo also has a marketplace for churches and ministries. All of this is offered directly by us, and by our subsidiaries, which we refer to as Gloo Capital Partners. Additionally, values-aligned AI capabilities are embedded across the Gloo offerings, ensuring that AI can be harnessed for good, helping people flourish and communities thrive. Our platform benefits from a powerful Flywheel effect. The platform becomes more valuable to churches and frontline leaders every time a new Network Capability Provider joins. And as more churches and frontline leaders engage on the platform, the distribution opportunity becomes more valuable to Network Capability Providers. This mutually reinforcing model strengthens the Network effects and increases the platform stickiness over time. Becoming a public company helps us accelerate this flywheel, giving us greater ability to invest in both organic growth and strategic acquisitions. As we have announced we recently closed two new acquisitions. The first is Igniter, a 15 year old media innovator that serves over 10,000 churches with content and media subscriptions. The second is XRI Global, a leader in AI, delivering advanced voice and language translation tech. I will also note that since our IPO the pipeline and pace of our M&A opportunities has increased. Through acquisitions, we bring the best-in-class Network Capability Providers into Gloo as capital partners which expands our offerings, deepens the value of our platform, and further reinforces the flywheel as we scale. For example, earlier this year we acquired Masterworks, a leading ad tech, marketing and fundraising company. They help organizations grow their impact, accelerate their mission, and deepen donor relationships. Today we are also super excited to announce our definitive agreement to acquire Westfall Gold, a leader in major donor engagement. This latest planned acquisition is another powerful example of our flywheel in action. Westfall Gold will deepen our role in helping organizations build sustainable, mission-aligned funding models. They provide donor development capabilities for non-profit organizations engaging high capacity and high impact donors. They do this with data driven insights and world class donor experiences. This is particularly significant because donor management is the very heart of the faith and flourishing ecosystem. Together with Masterworks, this extends our core competency in the central economic engine of this ecosystem, increasing donations. Masterworks and Westfall Gold with decades of proven success, also create significant cross sell and up sell opportunities with one another, as well as with our Barna and Gloo 360 offerings. We expect the acquisition to contribute approximately $20 million in revenue in fiscal year 2026 and contribute positive 2026 EBITDA as well. We intend to close this transaction before our fiscal year-end on January 31, 2026. Now I'd like to turn to our AI strategy. Gloo is developing vertical-specific, values-aligned AI. It is designed to serve the unique needs of the faith and flourishing ecosystem. As I mentioned earlier, this quarter we expanded our AI capabilities through the acquisition of XRI Global. XRI has pioneered advanced voice AI and multilingual technologies that engage people across thousands of languages, including low-resource languages that most AI models can't serve. This acquisition significantly strengthens our AI stack. It also increases the revenue opportunity for Gloo AI and Gloo 360, a few of our subscription-based enterprise offerings. As we advance these capabilities, we are also building and equipping a broader community of developers to innovate on top of the Gloo platform. The developer response has been strong. This year Gloo AI Hackathon brought together more than 700 developers to create faith-aligned AI applications leveraging our platform. We continue to take a leadership role in shaping AI for good. This includes developing a comprehensive benchmarking framework, so that developers and organizations can measure how the leading large language models perform in accordance with the seven dimensions of human flourishing. Earlier this week, we introduced the Flourishing AI Christian Benchmark, a new tool that provides insight into how various models support the Christian Worldview. Overall we've seen good customer momentum across both sides of the ecosystem, churches and frontline organizations, and the Network Capability Providers who serve them. So far in 2025 we have secured 20 customers that will contribute over $1 million in annual contract revenue, and we expect this pace to accelerate in 2026. Notable engagements include a multi-faceted, multi-year, enterprise-level engagement with American Bible Society for both Gloo 360 and Masterworks. Gloo 360 will support their technology infrastructure to enhance reliability, scalability, and long-term efficiency. Masterworks will serve as their mass fundraising and marketing agency, supporting their brand vision and revenue growth objectives. We are also very excited to announce a new initiative to develop the world's first biblically aligned AI, with YouVersion as a key partner. Working with YouVersion, who recently reached one billion installs across their Family of Bible Apps, we'll ensure this becomes a trusted tool for users worldwide. This will combine machine learning with centuries of biblical wisdom to help people engage with scripture safely, deeply, and accurately. Other customer wins in Q3 include expanded agreements with Biblica, United Way of Greater Atlanta, and Project Rescue. Looking ahead our long-term ambition is to extend our position as the trusted infrastructure for technology-enabled impact across the faith and flourishing ecosystem. We remain committed to harnessing technology for good, so that we can serve those who serve, and through them, more people can flourish and organizations and communities can thrive. Paul will now take you through Q3 results in more detail, cover our guidance for Q4, and provide preliminary growth and profitability metrics for 2026. Paul, over to you.

Thank you Scott. It's good to be with you for our first earnings call as a public company. Building on the strategic context Scott just shared, I'll walk you through our financial performance for the quarter. This was a solid first quarter as a public company and our results reflect good execution across the business and a significant inflection point for revenue growth. As Scott highlighted demand across both sides of the ecosystem combined with the early impact of our acquisitions, contributed to strong top-line growth. Revenue for the quarter was $32.6 million, an increase of 432%, compared to the same period. Last year, and 101% sequential growth compared to Q2. Year-over-year results were driven by solid organic growth across our portfolio, as well as acquisitions of several Capital Partner businesses, most notably Masterworks and Midwestern. Our Platform revenue includes advertising, marketplace and subscription offerings. Platform revenue totaled $19.8 million, an increase of $13.7 million from Q3 of last year, and 127% sequential growth. Much of this growth was driven by advertising revenue from Masterworks as new clients signed in Q2, fully ramped in Q3. This reflects the strong go-to-market execution referenced earlier. During the quarter, we also closed the acquisition of Igniter, which had a small impact on revenue in the quarter. Going forward, Igniter's subscription media products will primarily contribute to Platform revenue and align well with the broader platform strategy Scott described. Our Platform Solutions revenue includes technology, consulting and marketing services, primarily delivered by our Capital Partners, Masterworks, Midwestern and Servant. Platform. Solutions revenue was $12.7 million, up 71% sequentially, supported by strong performance from both Masterworks and Midwestern. Masterworks experienced a shift in timing, with some revenue typically associated with the fourth quarter taking place in the third quarter. Midwestern continues to see strong demand for development services and is expanding its sales capacity to meet that interest. As a reminder, Masterworks provides advertising offerings reported in Platform revenue and marketing and consulting services reported in Platform Solutions revenue. Midwestern provides technology consulting, also reported in Platform Solutions. Cost of revenue was 76%, an improvement from 81% in the prior year period. The improvement was due to increases in Subscription revenue and Platform Solutions revenue which carry higher margins, partially offset by the shift of revenue timing at Masterworks, affecting the quarter's margin mix. We see clear visibility to cost of revenue declining to below 50% over time. Adjusted EBITDA improved sequentially at negative $19.2 million, a [ $500 thousand ] improvement from Q2. This improvement reflects incremental gains across nearly all our Capital Partners. As a reminder, our adjusted EBITDA calculation includes expenses associated with acquisitions that other companies may consider one time in nature. As of October 31st, 2025, we had $15.1 million of cash and cash equivalents. Our November IPO added approximately $72.3 million after underwriting discounts and expenses, significantly strengthening our balance sheet and converting the significant majority of our debt to equity. I'd like to now turn to our Q4 2025 outlook. We expect revenue to be between $28 million and $30 million. This represents a more than tripling revenue growth year-over-year. Our fourth quarter guidance assumes continued strong demand across the platform, partially offset by the shift in Masterworks timing I mentioned earlier, and the normal slower December and January seasonality in this ecosystem. For Q4, adjusted EBITDA loss is expected to be between negative $19.5 million and negative $18.5 million, reflecting continued cost discipline. Westfall, which is expected to close in early 2026, is an adjusted EBITDA positive business and will play a positive role in our path to profitability. As a business in excess of $20 million in revenue, we expect a modest revenue contribution in Q4 with minimal EBITDA effect. As Scott noted, Westfall is a strategic fit for the platform given the critical importance of donor management to the faith and flourishing ecosystem. For Q4, we expect a weighted average share count of approximately 66 million shares normalizing to approximately 81 million shares in Q1 following the IPO, debt conversion, and recent M&A issuance. Importantly, $143.1 million of debt converted into equity, which left us with approximately $36.7 million of debt on the balance sheet. $17.0 million of this is owner financing from several acquisitions, $12.9 million is senior secured notes that did not convert as part of the IPO, and the remainder is from other notes payables. This significant reduction will meaningfully reduce interest expense moving forward. As part of this successful debt conversion related to the IPO, we incurred a number of meaningful non-routine direct and non-cash expenses totalling $11.2 million, that do not continue after the IPO. These charges are adjusted out of our non-GAAP net loss attributable to members of $26.7 million. Additionally, $12.3 million of non-routine, non-cash financing matters are reflected as deductions attributable to members. The combination of these two sets of non-routine costs results in a non-GAAP net loss of $39.0 million available to stockholders. This amount available is used to calculate non-GAAP loss per unit, which is negative $4.71 for Q3. Looking ahead, our financial approach is focused on building a scalable business by expanding our core offerings, integrating strategic acquisitions, and managing costs responsibly. With significant foundational investments already made, we believe we can now leverage our cost base more effectively to grow the top-line and improve profitability. We are experiencing an exciting financial turning point for the company and are issuing early guidance for 2026 to provide investors with a roadmap for our growth. We expect to nearly double revenue in 2026 to over $180 million. We are experiencing strong organic growth across the Gloo platform, including Gloo 360 and other offerings. We are also assuming that $40 million of the $180 million will come from incremental acquisitions. Our acquisition of Westfall contributes approximately $20 million of that $40 million. We have a robust and actionable M&A pipeline and expect M&A to be front half weighted next year. Additionally, we are firmly committed to achieving positive Adjusted EBITDA profitability in Q4 2026 and expect meaningful sequential improvement in Adjusted EBITDA to begin in Q1 2026 as cost savings actions combined with revenue growth will begin to flow through at that point. With that, I will turn the call back to Scott for some closing comments.

Thank you, Paul. Let me close by saying thank you to our team, our partners, our investors, and all the organizations and the people that we serve. Together, we've spent more than a decade laying the groundwork for Gloo, investing heavily in our technology, our partnerships, and our mission. Q3 marks a key inflection point in our business. We're now continuing this hockey-stick growth phase that we've been building toward, setting us up for a very strong 2026. Our goal is simple, to build a large, profitable, mission-driven company that serves those who serve and the Faith and Flourishing ecosystem so that these organizations can scale and thrive and the people that they serve can flourish, and we're doing this for the decades that are ahead. You have our commitment that we will execute with discipline. We will communicate transparently, and deliver on doing what we say we're going to do. Over to you, operator for Q&A.

[Operator Instructions] Our first question for the day will be coming from Richard Baldry of ROTH Capital.

Congrats on a great quarter. You essentially hit my 6-month out revenue target, so it makes life a little easier. I want to start with the more than 20 customers that should ramp to be over $1 million in annual contract value each. Can you walk through what they're buying? Are they multiproduct, multiservice buys? Or are they large scale within one of the offerings? Sort of where those buckets are coming in because that's obviously a good driver, an important driver of your organic growth.

Thank you, Rich. This is Scott Beck. It comes from a couple of different areas. Obviously, our Gloo 360 offering is a very significant offering to be able to bring advanced technologies to take over the infrastructure for many of these ministries and organizations that just have a hard time keeping up with that. In many instances, they can be decades behind and our ability to come in and to now be able to provide next-generation AI-powered infrastructures is a very significant driver of this. But in addition to that, we also got a lot of that from the Masterworks side where we've got major agreements and relationships as we're basically helping them develop from a donor standpoint, helping those organizations be able to reach more people, be able to get them powering the different organizations that they serve with greater donor engagement. We talked about earlier, a good example of that being ABS, American Bible Society, which we're working with on both the Gloo 360 side as well as on the Masterwork side. So those things are significant contributions as well. In addition, one other area, Rich, would be what we're doing with Midwestern. Midwestern has been a great partner of ours, being able to bring next-generation technologies, leveraging our platform to be able to build tech for other businesses and other ministries in this ecosystem. So I keep going and the pipeline is really strong as we look at 2026, but we're super excited and to be able to be delivering at scale, important technologies to the space and human flourishing ecosystem with many customers in excess of $1 million for the year.

And maybe drilling underneath that a little bit, can you talk about what the factors are that gate how quickly those turn from deals to revenue? Sort of what pace is that are they all sort of similar or some that ramp quickly, some that take a little more time, so we get sort of an idea of our backdrop to how quickly those impact organic growth?

Yes. This is Pat, and I'll give a little bit of color on that. And what we've seen is an acceleration of those opportunities this year. And we're definitely seeing some of these deals now that we have solid proof points across different categories. For instance, in the bible translation category, the ADS example that we gave, where we had very [indiscernible] earlier in the year. So that's caused acceleration to other bible translators. We have multiple in the campus state area. So we've seen acceleration in that category. We've now seen the university segment is now turning on and accelerating as well. So as we see the first proof points, we're able then to see acceleration for the subsequent closures. So I would say that everything that we're indicating is that the sales pipeline is robust, growing and closing faster than we would have expected. And the results that we already are seeing this quarter would be indicative of that accelerating pipeline.

Got it. And I'll just ask one more, as I don't want to hog the call too much. But with the pace of growth, you're doubling revenue sequentially. Obviously, acquisitions have been important to that. And the pace has been fast enough that I don't think anyone thinks you should have realized all your synergies out of that yet. Can you talk about just how much in synergy realization you should be able to see going forward from what you've put together, sort of how far along you are maybe ones that you've done a year ago versus ones that are just about to close? Just so we get an idea for how big a driver that can be of your move to adjusted EBITDA positive?

It is a factor for us next year as we look at our drive to profitability next year and accelerating quarter-by-quarter improvements in EBITDA next year, the synergy realizations across the acquisitions that we've done, but also our current core businesses become an increasing important role in accomplishing that EBITDA. Now that we have a solid platform in place, offerings like 360 in place, we're seeing the acceleration in those benefits. But it is an area of cost discipline that we have to put in place across everything that we're doing. Those efforts are already underway as we would say, and thus we have confidence in the next year because we've already initiated quite a number of those synergy realization and cost improvements. So we think we're quite good for those. They're accelerating. You'll see those showing up somewhat next quarter, but on an accelerated basis in Q1 and beyond.

I would add that the synergies both on the cost side as well as we were pointing out on the revenue side. Those revenue side synergies are super important. One of the things that we're so excited about, that's going on with Midwestern and what's happened there with MasterWorks, all of those basically create channel and partnership and synergy on the revenue side, which is also super important to accomplishing that Rich.

And our next question will be coming from the line of Yun Kim of Loop Capital Markets.

All right. Scott, Pat, Paul, first, super congrats on a strong first quarter out of the gate. Scott, if you can give us some update on what type of investments you are making in regard to your Gloo 360 business in terms of both sales, headcount growth and overall service delivery capability?

Sure. Thanks for the question. Pat, why don't you give us your perspective on the investment in Gloo 360 and [indiscernible] is that. Yes. And [indiscernible] for it, it really fits into 3 different dimensions. One is sales capacity, as you suggest, and we are ramping up our sales force and that is giving us more capacity to reach more segments, that hiring is underway. We're able to find very good candidates who have proven records in sales, software sales, enterprise software that want to join a faith and values-based organization like Gloo. So we're ramping up the sales capacity. Second, many of the Gloo 360 customers, we are taking on their staff. So immediately, we get the infusion of their talent, which we're rightsizing, upskilling and being able to add to our focus of resources for delivery. And then third is very targeted capabilities in areas like specific staff application, specific areas like security and IT services, but maybe most importantly, augmenting for AI and agentic capability that allow us to bring more margin to those relationships. So across that full set of capabilities, we're adding talent and seeing a very wide market for 360. But I'd also emphasize that it's not just 360 proper, but when we have a beachhead of 360, we're able to deliver AI services. We have the opportunity to become their marketing partner with Masterworks. And in many cases, the teams that we have at service and Midwestern become the project teams but also are being further as a result of those relationships. So we see those 360 or enterprise relationships really being the beachhead for us to be able to service the network providers at scale across the full value proposition of Gloo.

Okay. Great. And given that the sales cycle related to Gloo 360 is probably fairly long given the size of those deals, should we expect a typical seasonal back-end loaded kind of linearity for next year 2026 in terms of overall booking performance where majority of the bookings could happen more likely in the second half of the year?

Actually, the behavior that we're seeing is not the we are seeing the acceleration in the pipeline and the acceleration of deal closure for 360. So while exactly the characteristics that I would have expected is what you described, we're not seeing that. Once you have proof points in the category, we're seeing the category sales occur quickly, and we're seeing the ability then for those accounts to come on board on an accelerated basis. So I think you're going to see nice quarter-by-quarter improvements in our revenue and in our EBIT contribution as a result of those accounts. And I'd also say that just emphasizes the value that Gloo brings to this ecosystem. They have technology gaps. They have deep needs for capabilities and our ability to now have improvement cases like the ABS example that American Bible Society, example that we gave on the call is an evidence that we have capabilities that are desperately needed, desired and accelerating this ecosystem.

Okay. And then one last question for me. Pat, in regard to the overall AI efforts, obviously, there's a lot of talk about a capacity issue in the market. Are you running into any capacity issue? And if you are, what are the steps you're taking to minimize that impact?

Overall, our AI [indiscernible] at scale yet that we're hitting any of those capacity issues. However, we do see one of our opportunities to be the values aligned provider to the ecosystem, build the cost structure and scale, which is the question that you're really asking, and we're making sure that we're building all 3 of those. We're going to build a great platform. We have a leading-edge capability. We have values aligned with capacity and cost to serve this ecosystem, and we're planning carefully to make sure we have enough capacity in '26 and beyond to satisfy the ecosystem requirements. So a very active topic. But so far, we don't see any constraints in our ability to deliver.

And our next question will be coming from the line of Jason Kreyer of Craig-Hallum.

Wonderful. Great quarter. So I want to go back to the $20 million customers. As you look across the platform today, how many customers that you are currently engaged with have the potential to be $1 million customers?

Yes, great question. I mean we've been working, as you know, in this ecosystem for over a decade. And those relationships run substantially deep. When you look at our pipeline, our pipeline includes a lot of those long-term relationships, people that we've been working with as well as a lot of current customers. So I think from our perspective, it's a pretty unbelievably large set of potential customers and current customers that can scale to over $1 million. Now if you remember, we've got 2 sides of this ecosystem that we serve, right? One side are the churches and the frontline organizations. That's not where we're going to see $1 million customers. That's where we're being able to scale. We're adding paying customers over there at scale, super excited and happy with that growth rate. But that's not where your $1 million customers come from. Your million customers come from the Network Capability Providers, right? The folks that are basically out there providing services like Westfall Gold or MasterWorks itself, the organizations that are the not-for-profit on the front line, whether it's the campus ministries, whether it's the child development organization, the different bible translation organization on and on and on. So when you look at that as well as combining that with the customer base that Midwestern has got, the current customer base that 360 is working against, we see a very, very significant customer base opportunity in million plus.

I would just add 2 other quick points. One is you measure the [indiscernible] available for those network capability providers. They are in the $60 billion range. So this is a very large market with tens of thousands of brands in that segment. So we see that there's just many customers for us to reach for it. I'd also say that the $1 million customers, we see increased penetration inside those customers as well. So even as we are happy with the $20 million or the $20 million over $1 million, we see that there's increased opportunity inside every one of those customers.

I appreciate that. And then can you just maybe kind of compare and contrast the services or the capabilities that you're getting from Masterworks versus what you're bringing in with Westfall. And then maybe like if you look at the last several months since you've had Masterworks, it seems like a very logical cross-sell. And I'm just curious if there's any pushback and if kind of Westfall can help fill in some of those gaps in terms of where there might be pushback.

Yes. Thanks for sure. These are incredibly synergistic. As we said, the donor is the heart of this ecosystem, right? The donors whether they're small donors into a church or the bigger donors into the different major ministries that are out there, it's at the heart. And this is a very good set of synergies. You can think about Westfall Gold, which we're delighted to be bringing into the Gloo family today is really the top end of the donor pyramid. They do amazing data-driven, create incredible experiences, the best-in-class to be able to nurture major donors into multi-hundred thousand, multimillion dollar types of commitments. They do this better than anybody in the ecosystem. However, after those events that they do and how do you keep nurturing those organizations between those major events. That's when a Masterworks shows up who's excellent at being able to do that nurture in between the events as well as the nurture for the smaller donors that then can become the larger donors. So both of those are really core to what we're thinking about in terms of going forward. We're delighted with it and they're delighted with one level. I mean the folks at Masterworks are so excited that we've got Westfall Gold and the folks at Westfall Gold likewise are so excited to be able to partner at a deeper level with Masterworks.

And our next question will be coming from the line of Dan Kurnos of The Benchmark Company.

Great. Obviously, I will echo congratulations to you guys coming out strong out of the blocks. And Scott and Pat, since this is your guys' first call, and I know you've touched on pieces of this, but can you guys spend a little bit more time just kind of talking through the [ doctrine ] or guidelines that's informing the M&A for you guys, whether it's what you're paying, the price that you're willing to pay, the synergy opportunities that you see? And Pat and Scott, you both mentioned that the opportunity, the pipeline is probably better than you anticipated that it was. Is there anything that would sort of incentivize or make you guys be willing to be more opportunistic if the right particular product sets or capabilities broke your way?

Sure. Yes. So from our standpoint, it's important to realize that on the M&A front, we start with organizations that are already connected to our platform. We have been working with Masterworks for years. We've been working with Westfall Gold for years as an example. Midwestern, which was a very significant acquisition we have been working. So these are not strangers. Our pipeline is very strong and it's significant as we described. When you look at the prioritization, there's a couple of different categories that they drop into one of these capabilities around being able to serve the churches and those frontline organizations around donor, around marketing, around content that can add into the overall AI engine that we're doing. But we're also looking for things that are accretive. They're accretive from the standpoint of revenue and help us to build our revenue base. They're accretive in terms of EBITDA and EBITDA moving us and accelerating us to EBITDA profitability. And they're accretive from the standpoint of continuing to build the synergies within the Gloo platform, which strengthens the overall moat that we have in positively serving this ecosystem. But we're also looking for technology as an important part of that. Pat why don't you talk about that.

XRI acquisition is a great example of that. And acquisitions like that will definitely be part of the thesis going forward, strengthening offers that we already have deepening them in the marketplace. And the customer that we announced American Bible Society does Bible translation. And now we have maybe the leading logistics capabilities in the world with XRI in the AI-driven logistics area. So those are the areas that continue to excite us in strengthening the platform. Clearly, with 360, we're expanding the number of services, the range of services that we're offering. So we want to strengthen our capabilities there. And as Scott said, accretive. We're incredibly focused on getting the profitability as Paul will keep reminding us. And with that, we want to keep a high discipline on both the multiples that we apply and being able to rapidly see accretion in the financials that we result in. So those factors and a great pipeline of opportunities give us a lot of flexibility both exercise [indiscernible] but also opportunity.

Got it. That's really helpful. And then just to kind of follow up on, I think, Jason's question and maybe your answer, Scott, as we go into '26, and we know that you're adding capabilities all the time here, how should we think about growth from upsell and conversion from the existing customer base versus how much growth might come from new customers? And just to be clear, I don't think it does, but does the '26 guidance include any major wins or major deals like we saw with [indiscernible] in the prior year?

Couple of questions there. Number one, we're not seeing in our 2026 numbers, any big specific campaigns or it's the run of the middle of what we do. Gloo 360, more of that, MasterWorks, more of that, Midwestern, more of that, our media network, more of that. So there isn't anything in there except grinding it out good, solid organic growth with what we've already got. And then we had a little bit of M&A in that $180 million number. But we already just booked $20 million of that, right? So that number might have been $40 million that we were thinking about moving forward on a go-forward basis. $20 million of that is already in the bank. So we feel really good about that. But no, we don't see any major engager or one-timers that are coming through. Obviously, if something shows up, we would take advantage of it, but that's not what's driving our numbers.

And the question, Scott, just on new versus existing upsell, cross-sell?

Yes, sure. A balance between those for sure. We're going to be adding to the current customers that we've got. But when you look at a lot of the things, in particular, Gloo 360, a lot of that is going to be new. If you look at Masterworks, I think a lot of that is going to be able to be able to upsell. A perfect example of that upsell is the Westfall Gold being now be available to a Masterworks customer. So I think we've got a good balance between both of those.

Yes. And as I was indicating earlier, for us, additional customers within a category where we have proven success and we're able to move, I'll call it, horizontally within the category as opposed to vertically into a new category, that's a very efficient sale for us. And you get lots of synergies, essentially a Bible translator works with another Bible translator. Today they want us to be working with both of them. So we see a lot of affinity there. So it's deepening in the category as well. It's a very efficient sale for us, and we're seeing that very much in the realization of that growing sales pipeline and the accelerating sales pipeline. And we're just beginning to open up entirely new categories of that like we do with the Christian University segment, which we're starting to see some success. So we do think that we have the opportunity to go deeper with existing accounts bring more of the Gloo offering into those accounts, move within the segments that we're in, but then also begin to open up new categories as well.

We operate in a very collaborative ecosystem right now. And it's not one that we take lightly. I mean we love the work that these folks are doing. I mean what's better than being able to help more Bible translation is get to more places in the world. What's more being able to help the organizations that are out there on campuses help people that today are so much in need of community. And so not only are they collaborative, but that sets us up to be able to serve them well so that they can help more people and they can help the communities thrive.

And the next question will be coming from the line of Eric Wold of Texas Capital Securities.

A couple of questions. One, kind of a follow-up. Talk about the -- Scott, you talked about the pipeline for next year, the pipe of acquisition has obviously gotten stronger since the IPO. And you talked about next year being front half weighted and now you've done basically half of the $40 million already with Westfall. What would you need to see to maybe bring something from a '27 pipeline of acquisitions into '26 or accelerate that? And how much of that decision is really on your side, meaning you don't want to put too much on your plate, you want to wait for something to make sure it's accretive versus one of your partners on the platform, maybe not think it's the right time for them to be acquired and kind of waiting a little bit longer before taking that step?

Number one, discipline in strategy, right? We're going to be very strategic in terms of the investments and the acquisitions that we make. We're going to be very strategic and be very disciplined. We've been able to bring these partners in, been able to help them scale at this point, and we're going to continue to be hold that in check. And at the same time, we're going to be available to opportunities. The right partners and the right acquisitions come along. As long as they're being super accretive, we feel like we've got the right synergy and we can integrate them in a good way, we'll move on that. But strategic and disciplined. All of this ultimately then helps develop more moat and more synergies amongst themselves. And it also is then driving us towards that intense focus on EBITDA profitability in Q4. We're not going to let things get in the way of that. We're only going to be doing things that are going to be supportive of that. But it's got to fit from a strategic standpoint, and we've got to be disciplined.

Got it. And then kind of following up on that, as you think about an acquisition taking place and the company moving from an existing partner, NCP on your platform to an acquired company within Gloo Capital Partners. I guess how long has it typically taken? Obviously you've done a number of acquisitions in the past couple of years. How long does it typically take from that target to move from kind of the current revenue run rate to kind of actually seeing some synergies, revenue synergies kind of a boost to organic growth occur, I guess, for example, the $20 million you noted for Westfall in '26. How different is that from their current revenue run rate in terms of kind of expecting kind of meaningful organic growth on top of that to get to that $20 million?

We have a disciplined process of presenting business case and those business cases with synergies, both on the revenue and on the cost side. We're conservative in terms of how we build our business cases and what kind of revenue acceleration and cost acceleration we expect. We do not want to get ahead of ourselves on that. So we plan on that being very conservative and then we aggressively get after it. So in that $20 million, there isn't a lot of synergy built in. We believe that there is a lot of opportunity for synergy, but we don't build that in. If you look at the organizations that we've gotten involved with, we had on an overall basis, when we look at it cumulatively, we had very nice growth. In order to get to our number this year of $180 million, in addition to the $40 million of acquisitions that we've talked about and you guys have got a lot of them in your numbers, there is a lot of organic growth in that. And that organic growth is coming both from the Gloo platform offering as well as helping to organically grow [indiscernible] positions.

And the last question for the day will be coming from the line of Ryan Meyers of Lake Street Capital Markets.

Congrats on your first quarter as a public company. First one for me. I don't think you called this out in the prepared remarks, but what was the mix of recurring revenue during the quarter?

Ryan, good to talk with you. We don't break that out specifically within it. It really lines up with the revenue categories we break out in the [indiscernible] subscription, marketplace, advertising and platform solutions. But we don't have that detail right now.

Okay. And then just kind of as a follow-up on that, if we think about the 2026 revenue guide, I know you guys don't break it out by segment. But directionally, how should we be thinking about the mix across those 4 areas being subscription, marketplace, advertising and Platform Solutions, just so we can get a good idea of what to expect for '26.

Yes. I think that what you're going to see is as we're continuing on M&A as well as growing what we've got right now, Gloo 360, which is a big grower of ours is in that subscription area. There's some of the stuff that we brought in, let's say, like with Westfall Gold that's going to be a little bit more on the Platform Solutions side. So I think that you'll be able to see a continued trend in terms of what we've seen. You saw the platform grew faster than Platform Solutions as a percentage in this last quarter. And I think that, that is what we would expect to continue to see as we go through the year where the platform grows faster than the Platform subscription. But a little bit of that is also going to depend on M&A and where we ultimately go with that and how that fits in the mix. Our organic growth from [indiscernible] definitely geared towards platform and Platform and Subscription.

Thank you. And this does conclude today's conference call. Thank you all for participating. You may now disconnect.