Trimble Inc. (TRMB) CEO Rob Painter on Q2 2022 Results - Earnings Call Transcript

Trimble Inc. (NASDAQ:TRMB) Q2 2022 Results Conference Call August 5, 2022 8:00 AM ET

Company Participants

Rob Painter - CEO

David Barnes - CFO

Conference Call Participants

Jason Celino - KeyBanc

Rob Wertheimer - Melius Research

Chad Dillard - Bernstein

Jerry Revich - Goldman Sachs

Kristen Owen - Oppenheimer

Jonathan Ho - William Blair

Tami Zakaria - JP Morgan

Erik Lapinski - Morgan Stanley

Operator

Good day, and welcome to the Trimble Incorporated Financial Results Conference Call. Please note, today's conference is being recorded. [Operator Instructions]

At this time, I would like to turn the conference over to your host, Rob Painter, Chief Executive Officer. Mr. Painter, you may begin your conference.

Rob Painter

Welcome, everyone. Before I get started, our presentation is available on our website, and we ask that you refer to the safe harbor at the back. I will lead the call today as David is at home on the back end of the COVID quarantine. Jim Todd, our head of FP&A is in the room with me, and the 3 of us will handle the Q&A.

My commentary on revenue and ARR growth today will reflect organic performance, thereby excluding our acquisitions and divestitures and foreign currency movements. Let's begin on Page 2 with our key messages.

Our team delivered a record second quarter, exceeding our own expectations. My congratulations to our team and our global partners. Annualized recurring revenue grew 15% and we now stand at $1.51 billion of ARR. Total revenue was up 6%, also ahead of expectations, as was gross margin of 59.7%, a record level for Trimble. This flowed through to exceeding our expectations on EPS.

The Trimble operating system balances strategy, people and execution. We have been busy the last few months, demonstrating progression and proof points on many fronts. On strategy, we are seeing solid progress with our Trimble Construction One offering, which is a bundled offering of our construction software solutions currently targeted towards contractors. We tried to start with this segment of Trimble customers as we have the value proposition and momentum on our side.

From this new baseline, we will expand to other personas and construction such as architects and designers and owners, and we will roll out the offering on a more global basis. We will then extend this approach across our other applicable businesses. Our indicators are telling us that with Trimble Construction One, our win rates are going up, our sales cycles are becoming shorter and our average deal size is increasing.