DearShareholders,
Iampleasedtoreportthat2013wasayearofcontinuedstronggrowthandstockprice
appreciationforourcompany.Totalrevenueswereup34%fortheyear,reaching$318.2million.
Ordersgrewastrong30%,withourcloud‐basedordersservingastheprimarygrowthcatalyst,up
87%.Duringtheyear,wesigned316newcustomers,thelargestnumberinthelastfive years.We
remainprofitableandwerecashflowpositivefortheyear.Cashandinvestmentsincreasedto
$107.8millionattheendof2013andweremaindebtfree.
Ourdeliberateandaggressiveeffortstogainmarketsharewiththecontactcentermarket’sshift
tothecloudhavepaidoffandhavebeenthemainsourceofourstronggrowth.Moreandmore,
weseecustomersmakingthemovetothecloudasawaytoreducetheirinternalITrequirements
andbetter‐focusontheirprimarybusiness.Thesecustomersareunwillingtocompromise
functionalitysimplytogettothecloud,andthatiswhereourvalueresonateswell.Wearea
trustedvendor,withthousandsofinstallationsandaverymature,scalableproduct.
During2013,wealsoworkedtoexpandthereachofouroffering.InMarch,weintroducedCaaS
SmallCenter
SM
,whichistargetedatcontactcenterswithfewerthan50agents.Wethinkthiswas
animportantstepforustoprotectourcorebusinessfromnewcompetitorswhomightotherwise
makeinroadsatthelowend.Thismovealsoopensupasignificantportionofthemarketforus
withafeature‐richofferingthatcangrowrightalongwithourcustomer’sgrowth.WithCaaS
SmallCenter,we’vebeenabletohelpsmallercustomersrealizethattheydon’thavetobeabig
contactcentertodeliveragreatcustomerexperience.
Duringtheyear,weacquiredthecustomerbaseofourNewZealandresellerAmtel
Communications,Ltd.TheacquisitionbenefitsformerAmtelcustomersbygivingthemdirect
accesstoourlocal,regional,andglobalsupportandservicesstaff.Atthesametime,theAmtel
acquisitionhashelpeduslaunchourcloud‐basedCommunicationsasaServiceofferinginNew
Zealand.
In2013,wewereagainrecognizedforourcustomerexperienceandcontactcenterleadershipby
respectedindustryanalystsandpublications.Gartner,Inc.againplacedusinthe“ContactCenter
Leader’sQuadrant,”initsMagicQuadrantforContactCenterInfrastructure,Worldwidereport—
oneofonlyfourvendorsreceivingthistopranking.Frost&Sullivannamedusthecloud‐based
contactcentersolutionscompanyoftheyear,NorthAmerica.InOvum’smultichannelcloud
contactcentervendorreport,wescoredthehighestoverallinthetechnologyassessment.
TechPointnamedustheIndianatechcompanyoftheyearandbasedonemployeesurveys,we
wererecognizedasoneofthetop10placestoworkintheU.S.byGlassdoor,sharinghonorswith
companiessuchasGoogle,Facebook,andTwitter.
Lookingforward,weareoptimisticaboutourfuture.Weareinvestinginthebusinesswitha
targettogrowordersatarateof20%in2014,whilemaintainingprofitability.Ourstrategy
continuestobegrowthandleadershipinthecontactcentermarket,especiallyasitrelatesto
deliveringcloud‐basedsolutions.InnovationremainspartofourcoreDNA,andwewillworkto
furtherpushwhatourcustomersareabletoaccomplishwithourproductsandservices.Thiswill
includesomeexcitingnewproductsreleasedduring2014.
It’shardtobelievethatthisyearmarks20yearssinceIfoundedthecompanywiththesingleidea
ofdeliveringabetterwayofmanagingcustomerinteractions.It’sgratifyingtoseethegrowthof
ourbusiness,thenumberofsuccessfulcustomerimplementationsofoursolutions,andthe
market’svalidationofoursuccess.
DonBrown
ChairmanandChiefExecutiveOfficer
2013 HIGHLIGHTS
FINANCIAL PERFORMANCE
Tenth consecutive year of positive
operating results
• $318.2 million total revenues
o $117.7 million, product
o $147.9 million, recurring
o $52.6 million, services
• Total revenues up 34 percent from
$237.4 million in 2012
• $9.5 million in net income
• Diluted EPS of $0.45
• $107.8 million in cash and investments
as of December 31, 2013
• One acquisition completed in 2013
• 16 percent of revenue spent on R&D
GROWTH UP-MARKET
• 192 orders $250,000+
o Up from 158 in 2012
• 110 orders over $250,000 from new
customers
o Up from 102 in 2012
NEW SOLUTION RELEASES
Interaction Feedback™
INDUSTRY RECOGNITION
Gartner, Inc., Leader’s Quadrant, 2013
“Magic Quadrant for Contact Center
Infrastructure, Worldwide” report, the
most recent report
Number 203 in the Top 500 Global
Software & Services Companies list
(thirteenth consecutive year listed),
Software Magazine
2013 Cloud-Based Contact Center
Solutions Company of the Year, North
America, Frost & Sullivan
2013 Market Leader, Multichannel
Cloud Contact Center Vendor Report,
Ovum (shortlisted)
2013 IP Contact Center Technology
Pioneer Award, CUSTOMER Magazine
2013 TechPoint Mira Award, Tech
Company of the Year
2013 Cloud Computing Excellence
Award, Cloud Computing Magazine