nCino CEO Discusses Earnings & Ways to Capitalize on AI's Reach in Finance

**Marlee** (0:00)
For more on the quarter, we are joined by Sean Desmond, the CEO of Encino. Sean, great to have you on. Thank you for taking the time to be with us to take a closer look at your numbers for the quarter. If you wouldn't mind starting by just telling our viewers a little bit about what Encino does, and also what you view as the key takeaways from your latest report.

**Sean Desmond** (0:19)
Thanks for having me, Marlee. Appreciate the opportunity.
Yes, Encino provides the world's only platform that delivers onboarding account opening, loan origination and portfolio monitoring solutions to our customers. We serve commercial, consumer and mortgage lines of business, and we do that the world over. We serve community all the way up to enterprise banks with trillions of dollars and assets under management, as well as credit unions and IMBs, and we do that with a native AI posture.

**Marlee** (0:51)
As we look through some of the numbers here, the headline is strong. Your revenue is up 8 percent, subscription revenue up 10 percent, your non-GAAP operating income up 36 percent here. You also hiked your guidance. What are the primary drivers behind these?

**Sean Desmond** (1:08)
Listen, every conversation I have with customers, when I travel here in the US market, whether that's community or enterprise bank or internationally, they're validating that they're looking for in.
Let's go. for us to drive efficiency into the balance sheet of our customers.

**Marlee** (1:56)
And Sean, when you talk to these customers, what are you seeing in terms of bank technology budgets right now? Are they increasing their spending on AI? Are they reallocating existing tech budgets into different avenues? What are you hearing in these conversations?

**Sean Desmond** (2:13)
What is happening is that the Encino sale is becoming a more technical sale. We used to really interact primarily with the line of business leaders, maybe the head of the commercial bank, maybe the head of the mortgage bank, and we're seeing today that we have technology leaders, leaders of AI, AI strategy at the table.
So what I would suggest to you is that there's nobody out there who's not spending on AI. Just like every single experience we render in Encino is activated with AI, our customers are thinking the same way. So when they think about spending, traditionally it's been a very polar sort of build versus buy scenario, and now they're contemplating both build and buy, where they're going to look to a provider like Encino who's got a proven track record, the vendor they trust, and they're also going to want to potentially build agents on top of that platform that interact with the agents that we serve up natively.

**Marlee** (3:10)
And Sean, whenever I have these conversations about AI adoption and the use of agentic AI, it's always about the adoption numbers and the uptick we're seeing. But you make a very interesting point. You say that agentic AI should really be measured in business outcomes, not in adoption metrics. So as we look at some of those business outcomes, and I know you just mentioned a few of the use cases there in your last answer, what specific KPI should banks be looking at? And what are some specific examples you can offer that are showing the ROI here on the actual spend for agentic AI?

**Sean Desmond** (3:44)
Yes, Marlee, we've always been focused on the outcomes. And by and large, the outcomes that banks, credit unions, and IMBs are looking for today are the same outcomes they've been looking for for the past 15 years we've been in this business. And so if you're going to drive efficiency and growth and productivity into your customer base, they want things like faster loan cycle times. They want to reduce application abandonment rates.
They want to simply drive efficiency everywhere they can find it. For instance, we provide a continuous credit monitoring experience that includes a native chat experience with our own proprietary models, our own algorithms, and our own data. We're not looking to automate enterprise banks on public cloud data. So customers, rather than providing quarterly or annual reviews, can have the agents doing this work literally while they're sleeping on an ongoing basis and indicate the next option, create the documents and recommend the next best action.

**Marlee** (4:46)
And Sean, before we have to say goodbye, I want to talk about your buyback. You authorized $100 million stock buyback after you repurchased roughly $165 million in stock in the latest quarter. Why is buying back stock right now the best use of capital for Encino rather than aggressively investing in AI or growth?

**Sean Desmond** (5:06)
Listen, first of all, we're very confident in the momentum in our business right now.