Q4 2023 Rimini Street Inc Earnings Call

Participants

Dean Pohl; Investor Relations; Rimini Street Inc

Seth Ravin; CEO & Founder; Rimini Street Inc (Pre-Merger)

Michael Perica; Chief Financial Officer, Executive Vice President; Rimini Street Inc

Brian Kinstlinger; Analyst; Alliance Global Partners

Daniel Hibshman; Analyst; Craig-Hallum Capital Group

Derrick Wood; Analyst; TD Cowen

Presentation

Operator

Good day, and thank you for standing by. And welcome to Rimini Street fourth-quarter 2023 earnings call. (Operator Instructions) Please be advised that today's conference is being recorded.
I would now like to hand the conference over to your speaker today, Dean Pohl, Vice President, Treasurer, and Investor Relations. Please go ahead.

Dean Pohl

Thank you, operator. I'd like to welcome everyone to review through fourth-quarter and fiscal year 2023 earnings conference call. On the call with me today is Seth Ravin, our CEO and President; and Michael Perica, our CFO.
Today, we issued our earnings press release for the fourth quarter and fiscal year ended December 31st, 2023, a copy of which can be found on our website under Investor Relations. A reconciliation of GAAP to non-GAAP financial measures. It has been provided in the tables following the financial statements in the press release an explanation of these measures and why we believe they are meaningful. It's also included in the press release under the heading About Non-GAAP financial measures and certain key metrics.
As a reminder, today's discussion will include forward-looking statements that reflect our current outlook. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from statements made today, and we encourage you to review our most recent SEC filings, including our Form 10 K filed today for a discussion of risks that may affect our future results or stockprice.
Now before taking questions, we'll begin with prepared remarks. With that, I'd like to turn the call over to Seth.

Seth Ravin

Thank you, Dean, and thank you, everyone, for joining us today. since its founding 19 years ago, Rimini Street has grown and evolved into a different kind of full IT services company focused on the needs and goals of our clients. Other IT service companies are focused on getting their clients to spend as much as possible on projects that maximize sales of their software services and hardware vendor partners and meet their own financial objectives.
Instead, Rimini Street works as a trusted partner to its clients and has no partnerships with other IT vendors that compromise or influence its independence and advice, counsel and recommendations provided to clients. We only have technology partnerships that we used to provide our clients, value leverage and access to what we believe are strong solution opportunities. Rimini Street is focused on developing a remaining SmartPath road map and ROI. driven analysis of options and strategic recommendations to clients on the best allocation of limited IT budget, people and time resources to help them achieve their strategic financial and operational goals.
When other IT firms say no remaining works to say, yes, we will get you there, we help our clients achieve better business outcomes, such as accelerating growth, lowered operating costs, increased investment in innovation and improved competitive advantage. We believe we have already delivered over 8 billion of savings and reinvestment opportunity to our clients.
Not only is Rimini Street, a global leader in its deep technical capabilities to run manage, support, protect, connect, monitor, customize, configure and optimize mission critical enterprise application Database and Technology software. But Romania is also growing technical and business capabilities to assist clients with innovation projects that include cloud, open source products, automation, workflow data analytics, AI reporting, application modernization, license management, migrations, integrations, security and global IT governance.
To date, we have served over 5,500 Fortune 500 Fortune Global 100 mid-market and public sector organizations in nearly 150 countries and have global operations with over 2,100 employees across 21 countries. We have an average engineer response time of less than two minutes 24 by seven by three 65 and earn an average client satisfaction score on our support delivery and onboarding services of 4.9 out of five where five is sorry, Q4 and fiscal year 2023 results for the fourth quarter and full year 2023, we continued focusing on improving sales execution across our expanded portfolio of solutions and being able to deliver the full portfolio of solutions globally as our current and prospective clients learn more about the unique offerings and value of our expanded solutions portfolio.
They're responding positively and buying across the full portfolio. Accordingly, to meet the increased demand, we have substantially increased our seller count and sales capacity coming into 2020 for throughout 2023, we saw our end to end ERP outsourcing solution, Rimini One solutions for SAP products and sales force. AMS. solution continue to gain sales traction globally to enhance and accelerate lead opportunity and pipeline development and help close more large and strategic transactions for Rimini Street.
Our senior executives, including myself, continued our extensive in-person Rimini Street client and prospect meetings and attendance at third party events and executive sales meetings in the United States and globally with many current and prospective clients to deliver our full solutions portfolio globally. We continue to grow our workforce and expand our capabilities backed by innovation and technology that provides additional leverage for increased capacity, profitability and revenue growth, demand environment and competitive advantage.
We continue to see strong demand for a proven, reliable, trusted partner for mission critical transaction system services that can allow organizations to consolidate their preferred IT service providers for streamlined vendor management, increased aggregated purchasing power and better business outcomes. Organizations today need to figure out how to deliver both revenue growth and increase profitability. And now as an end to end provider of mission critical IT support products and services.
Rimini Street has the broader portfolio of solutions needed to be recognized as a key IT service partner that can help enable our clients to lower operating costs and achieve their goals from developing IT strategy and building roadmaps. Through plan execution, expanded software products support introducing remaining custom this week, Rimini Street officially launched its remaining custom solution.
This program allows organizations to request custom support solutions for a broader set of enterprise software that they're using beyond Rimini Street's current supported product list, whether the client goal is to consolidate IT landscape support or managed services under a single trusted partner, extend the operating life of the software product or release or just obtain better and more responsive support, we believe remaining customers an exciting new solution.
The remaining customer service is now available to clients and new prospects for I-many's through. We'll work to say, yes, it presents a proposal for any remaining custom client requests that meet license, supportability and resourcing analysis. With our new remaining custom offering, we believe that we are even better positioned to meet the current and evolving IT service needs of private it public sector organization in the years ahead, Oracle litigation update, Rimini Street and Oracle have been in litigation for more than 14 years, including cases known as remediate one and remaining two.
In 2010, Oracle filed the Rimini One case against Rimini Street and US District Court as a result of the remaining one case with trial completed in 2015 and subsequent appeals, the U.S. court has affirmed that third party software support is legal. U.s. court issued a permanent injunction known as the remaining one injunction enjoining certain activities related to the manner in which Rimini provide support on certain Oracle product lines. The Rimini One and Johnson does not prohibit remaining from providing support to any Oracle product line.
There are no current litigation activities related to Rimini one subsequent to the remaining one trial, Oracle filed have prevailed on certain claims and IT content proceeding related to the Rimini One injunction. Rimini Street was fined and paid U.S. $530,000 and settled and paid Oracle's attorneys' fees and costs for USD9.7 million in 2014 remaining filed the remaining two case against Oracle in the US District Court trial occurred in 2022, while Oracle prevailed on liability for its DMCA and Lanham Act claims with no damages award Oracle advantage.
It's $1.4 billion of damages claim and all non affordable claims with prejudice on the eve of a jury trial and losses copyright claims for a majority of product lines that issue in the case, EBSJDE. and CBO. on the remaining product lines PeopleSoft database, Oracle prevailed on the migration process, the use of certain rewrite files and the use of certain automated tools for remaining prevailed on central cross cutting legal theories that recorded all of broad infringement claims spanning all Oracle product lines such as confirming remaining may write down and reuse its own know-how and that Oracle's licenses permits a third party like remaining to perform updates or fixes to the same extent as the licensee today, there are currently three remaining two post-trial litigation matters.
One appeal of the remaining two findings and the remaining two injunction before the Court of Appeals. Notice the merits appeal to a motion to further stay the remaining two injunction pending remaining merits appeal. Also before the Court of Appeals and three litigation over Oracle's requested recovery of their attorneys fees and costs related to Rimini two before the US District Court in July 2023, concurrent with the District Court trial Roland's for Rimini two, the District Court issued a permanent injunction, known as the remaining two injunction, which among other things further and joins the remaining activities related solely to the manner in which remaining provide support on certain Oracle product lines, which are mainly ST, has sought to reverse as of this date and administrators, say of the remaining two injunction is in place and the Court of Appeals has not yet issued a decision and our motion to stay the remaining two adjunctive through the appeals process.
With respect to the remaining two merits appeal. The court of appeals will hear the appeal on an expedited basis, which will include the appeal of the remaining two injunction. Romania's opening brief for the remaining two merits appeal is due March fourth, 2024. And Oracle's answering brief is due April third, 2020 for Romania's optional reply.
Brief is due within 21 days after service of Oracle's answering breaks. Court of Appeals has currently set the date of June fifth, 2020 for to hear oral arguments on November sixth, 2023, Oracle filed a motion for attorney's fees and taxable costs with the US District Court requesting attorneys' fees and taxable costs totaling approximately USD70.6 million related to the remaining two litigation on February 20th, 2024, Romania filed its opposition to Oracle's November sixth, 2023 motion for attorney's fees and taxable costs in the remaining two litigation in the opposition remaining argues that the District Court denied Oracle's motion in its entirety remaining further argues that should the district court award any attorneys' fees to our call.
Such fees should not exceed USD14.47 million for Oracle's replied. Romania's opposition is due by March 15th, 2024, after which the matter will be taken under consideration for determination by the District Court remaining reserves all rights, including appellate rights for the respect to the remainder to litigation, including any award of attorney's fees and taxable costs to Oracle for additional information and disclosures regarding the company's litigation with AuRico, please see our disclosures in the company's annual report on Form 10 K filed today, February 28th, 2024, with the US Securities and Exchange Commission.
Please also note that at this time, we are still unable to provide material additional information beyond the disclosures and statements in our press releases filings with the SEC and court filings nor provide guidance with respect to future financial results, nor are we able to provide additional commentary related to the pending or litigation and potential impacts of the remaining two injunction because the matters are still before various courts and the outcomes cannot be predicted.
In summary, we remain confident that we are continuing to take the right actions and making the right investments to accelerate growth, increase profitability, enhance shareholder value and bring our litigation with Oracle to a successful conclusion. However, if Rimini Street does not ultimately prevail in the litigation matters described above and in our SEC filings, it could have a material adverse impact on our business and financial results.
Now over to you, Michael.

Michael Perica

Thank you, Seth, and thank you for joining us everyone, Q4 and fiscal 2023 results. Revenue for the fourth quarter and the full year 2023 was $112.1 million and $431.5 million, respectively, a year-over-year increase of 3.2% and 5.3%, respectively. Clients within the United States represented 51% while international clients represented 49% of total revenue for both the fourth quarter and full year 2023 annualized recurring revenue was $432.3 million for the fourth quarter, a year-over-year increase of 2.9%.
Revenue retention rate for service subscriptions, which makes up 96.4% of our revenue, was 90% with more than 79% of subscription revenue noncancelable for at least 12 months. We note that for the full year 2023, our total revenue measures on a constant currency basis was negatively impacted by 0.6% due to FX movements. The decline in our revenue retention rate for the year ended December 31st, 2023 was due to attrition during the fourth quarter as certain clients did not renew specific subscriptions.
However, in some cases maintained or added subscriptions for other product, our net billings during the fourth quarter of 2023 was flat to the comparable period of 2022 because record fourth quarter new client invoicing was able to offset fourth quarter retention losses billings for the fourth quarter were $160.7 million compared to $160.4 million for the prior year fourth quarter.
For the full year 2023, billings increased 2.3% to $418.5 million. Gross margin was 61% of revenue for the fourth quarter and 62.3% for full year 2023 compared to 64.5% of revenue for the prior year fourth quarter and 52.8% for prior year 2022. On a non-GAAP basis, which excludes stock-based compensation expense, gross margin was 61.5% of revenue for the fourth quarter and 62.8% for full year 2023 compared to 64.9% of revenue for the prior year fourth quarter and 63.3% for prior year 2022 gross margin declined during the back half of 2023 as a result of continued investment in an expansion of our global engineering team needed to serve new client engagements in advance of related ratable contract revenue recognition.
As noted in previous earnings calls, we are expecting continued gross margin pressure as we scale to meet new client engagements simultaneously. We are also working to improve gross margin by driving efficiencies and leveraging the benefits of growing global scale operating expenses, while inflationary pressures and high cost are still persistent for skilled labor across all theaters. We continue to attract and retain key talent. Moreover, our margin performance in light of the pressures highlighted previously underscores the advantage of our global footprint with centers of excellence and geographies for both talent and value remain attractive compared to higher price Capital Markets.
Sales and marketing expenses as a percentage of revenue was 31.2% of revenue for the fourth quarter and 33% for full year 2023 compared to 36.1% of revenue for the prior year fourth quarter and 34.9% for prior year 2022. On a non-GAAP basis, which excludes stock-based compensation expense, sales and marketing expenses as a percentage of revenue was 30.5% of revenue for the fourth quarter and 32.3% for full year 2023 compared to 35.4% of revenue for the prior year fourth quarter and 34.1% for prior year 2022.
General and administrative expenses as a percentage of revenue, excluding outside litigation costs, was 15.7% of revenue for the fourth quarter and 16.9% for full year 2023 compared to 16.7% of revenue for the prior year. Fourth quarter and 18.4% for prior year 2022. On a non-GAAP basis, which excludes stock-based compensation expense and litigation costs, G&A was 13.8% of revenue for the fourth quarter and 15.1% for full year 2023 compared to 15.6% of revenue for the prior year fourth quarter and 17% for prior year 2022, we are seeing a good year-over-year improvement in G&A spend due to some restructuring measures and the initial substantial investments that were required to develop and launch.
Our expanded portfolio of solutions are largely completed. However, G&A expenses as a percentage of revenue are expected to remain elevated compared to our peers due in large part to the ongoing calls for in-house legal and compliance teams and other costs made necessary by our ongoing Oracle litigation and compliance activities.
Net outside litigation expense, which includes the Oracle settlement previously referenced was $4.3 million for the fourth quarter and was $9.8 million for the full year 2023 compared to $12.8 million for the prior year fourth quarter and $25.3 million per prior year 2022.
This year's fourth quarter included an accounting charge of $2.7 million related to the $9.7 million Oracle cash settlement that I discussed earlier related to the remaining one injunction content matter. Litigation expenses will vary quarter to quarter and year to year, depending on current litigation activity.
Our non-GAAP operating margin, which excludes outside litigation spend stock-based compensation, was 17.2% of revenue for the fourth quarter and 15.3% for full year 2023. Net income attributable to shareholders for the fourth quarter was $9.4 million, or $0.1 per diluted share. And for the full year 2023 was $26.1 million were $0.29 per diluted share. On a non-GAAP basis, net income for the fourth quarter was $17.1 million or $0.19 per diluted share.
And for the full year 2023 was $48.4 million or $0.54 per diluted share. Adjusted EBITDA as defined in our press release was $21.3 million for the fourth quarter or 19% of revenue, and for full year 2023 was $71.9 million or 16.7% of revenue balance sheet. We ended the fiscal year with a cash balance of $115.4 million plus investments of $9.8 million consisting of short term treasuries and U.S. government agency securities, bringing readily available cash to $125.2 million compared to $129.1 million for the prior fiscal year.
And during 2023, we reduced the principal balance on our term loan from $78.3 million to $72.6 million, resulting in a year-end net cash position, $52.6 million on a cash flow basis for the fourth quarter operating cash flow declined $1.1 million. And for the full year 2023, we generated $12.5 million compared to a decline of $1.9 million for the prior year fourth quarter and a positive $34.9 million for full year 2022.
The year-over-year variance is due primarily to large nonrecurring payments made during the first quarter to our outside litigation counsel relating to the fourth quarter 2022 remaining two trial with Oracle and overhead restructuring charges. And during the fourth quarter as noted, we paid $9.7 million to settle the content matter. In addition, throughout 2023, we experienced lower client, multiyear prepayments and related collections compared to the prior year 2022, as clients retain cash in the higher rate environment for their own short-term investment opportunities and the preservation of cash.
Lastly, FX headwinds noted also impacted cash flow. Deferred revenue as of December 31st, 2023, was approximately $287 million compared to $300 million from the prior year fourth quarter backlog, which includes the sum of billed deferred revenue and noncancelable future revenue was approximately $607 million as of December 31, 2023, compared to $578 million for the prior year fourth quarter business outlook.
The Company is continuing to suspend guidance as to future financial results until there is more clarity around the impacts from current litigation activity before the US federal courts and the Company's ongoing litigation with Oracle. For additional information and disclosures regarding the company's litigation with Oracle, please see our disclosures in the company's annual report on Form 10 K filed on February 28th, 2024, with the US Securities and Exchange Commission.
This concludes our prepared remarks. Operator, we'll now take questions.

Question and Answer Session

Operator

(Operator Instructions) Brian Kinstlinger, Alliance Global Partners.

Brian Kinstlinger

Hey, guys. Thanks for taking my questions. First one, am I going to start the expense side, you suspended revenue guidance for the obvious reasons. And so how do you plan on managing operating expenses over the next year is revenue while revenue is growing at a very modest clip.
You expect to hold off making investments that's going to add OpEx with some investments that were just completed. Do you plan to cut cost do you think holding a line where you are right now before there's more clarity is the option we'd like to get some more understanding of what you can control?

Seth Ravin

Sure, Brian, great to have the call. Of course, we have I think you could tell from the size of the sales force were I had mentioned we've continued to expand the sales force we're continuing to invest and lean in because of the size of the opportunity that we see. I think you're watching us relay that we are not looking to reduce costs.
We are not in a hunker down position. We had modest growth across 2024, while we were busy spending and building out our global infrastructure to support all of these different product lines that we've launched, including launching, as I mentioned in my prepared remarks today, the remaining consult, which is a very large program on a global basis to take on its support provide managed service for a huge number of additional product lines, including IBM and others.
So I think you're definitely not seeing us take a reduction of cost. I think we the reductions we've made have all been about streamlining operations where we're taking out some middle management. We're giving wider scope of responsibility to vice presidents and above to get better leverage but that's all about making sure that we're able to support and drive higher revenues and more accelerated growth into 24 and beyond.
Great.

Brian Kinstlinger

And then on the international business side, the year-over-year growth rates decelerated for the third consecutive quarter, about 4.5% just in the fourth quarter. What's driving the deceleration or anything in the bookings trends?

Seth Ravin

It suggests a reacceleration in this in the first half of 24 male given without getting into the guidance side of things, just focused on the business, we had some issues we had some issues down in the IANZ., the Australia New Zealand area. We had some issues in the Amea area, which we, of course have taken significant steps.
We have a brand new GM running the EMEA region, which I'm very, very happy to announce. We brought him over from Adobe, a very strong player. And in the ANZ market, we have a new leadership there as well, where we've turned things around. I believe those two contributed to some of the challenges. We also have some evolution going on in Japan where we have a very strong client base, our largest in all of Asia Pac, as we now roll out our additional services there and we've reconfigured the sales force to be able to handle that.
I think as you guys well understand every time you reconfigure a sales force, you have a little bit of lag and disruption into the operation. And we're very aware of that. But these are the kinds of changes necessary to be able to support the growth, the accelerated growth that we want in the future across all the product line portfolio Great.

Brian Kinstlinger

Last question. I'll get back in the queue. It might be related and might be some of the same answer, but you spoke to the 90% retention versus what's traditionally been three to four points higher and we've lost customers in these regions.
And was there a similar rationale for the handful or so? How many customers left or were they at all different cases?

Seth Ravin

Yes, I think, of course, as you can imagine, when we when we have higher retention losses than normal, if you look on a normalized basis, it happens that it's happened over the years where you kind of go up and down. I could tell you that we had a few larger cancellations.
Two of them were in the Australian market which were pretty significant. But at the same time, those are existing clients there. They are huge clients who rotated out on a couple of products. They were they were running, but they're natural rotations and some of those things we just have to go back. One of them, I think was a loss we shouldn't have had. And so we've gone back to look at it. The other one wasn't anything we could do about it. It was just a business, a rotation.
And then I saw one big one in the North American region which came as a surprise. Again, as part of an M&A. The biggest risk we always have is M&A because they change our management teams and we have to go in and resell our position when those management teams change. And so it is almost like a new sale because they don't know who we are, what are we doing in there?
And that is a process that always creates risk for us. So in the world of business turn, M&A always present the biggest risk to the business in terms of ongoing contracts, but they often present new opportunities for us as well, where a management team may have been more stubborn or maybe not fully bought into the full portfolio, then we get a change of management and we get to come in and expand our footprint. But it does generally cause some level of churn when we had management change.

Brian Kinstlinger

Great. I have a few more, but I'll get back in the queue like others.

Seth Ravin

Terrific. Thanks, Brian.

Operator

Daniel Hibshman, Craig Hallum.

Daniel Hibshman

Hey, guys. Thanks for take my question. This is Daniel, on for Jeff Van Rhee. Just on the employee count, I saw that was up 9% sequentially, about 10% year over year, but still getting the non-GAAP OpEx down sequentially and year over year. Just curious how you manage that.
Was that, you know, in the geographies you are hiring with the hiring really late in the quarter and then just maybe double-clicking on what areas you're hiring for, I know for sales, but just anything else on the roadmap roadmap, et cetera?

Seth Ravin

Sure. Happy to answer that. I think you've got a few different things. One, I'm not a big fan of the employee count numbers. I know a lot of people look at that and say, well, if that percentage is higher than your actual growth. That looks like a problem, but it doesn't take into account the cost of the personnel. A lot of those hires are in lower-cost geographies.
We have two big delivery centers between India and Brazil, which presents significantly different annual comp rates than you would have, for example, of course, in the United States or across in Europe, so from that point of view, yes, we have lower costs coming into it. That's one component that allows us to have the higher number of people by account number second, one is you're correct. We often do a lot of hiring on service delivery on the back end of the year.
We are a back-end loaded business. And as you know, because we've been a bootstrapped business with literally what, $27.5 million of invested capital to drive over $400 million a year business. We have to use our own cash. We what that means is we're very good at hiring just in time. We don't hire generally in advance of contracts that allows us to minimize the burn cost of personnel, not being utilized and we wait for the contract signed and then we aggressively hire to fill that.
And so that's very much with the fourth quarter as we grow our business in the fourth quarter, you're going to see a lot more hiring in the fourth quarter. So of course, you haven't seen the ratable costs on that yet. So that is a combination that drives that.

Daniel Hibshman

And then on the billings and backlog, those both came in pretty nicely. Just any more color on that in terms of the biggest drivers of that in terms of what's coming down the pipeline, any particular verticals, application services, what platform is seeing strength there?

Seth Ravin

Well, I think we're seeing again good strength across all platforms. I think again, as I mentioned in the prepared remarks, specifically strong in the SAP world where you've got thousands and thousands of companies being pressured by SAP to move their systems between 2025 and 2027 with threats of the support no longer being supported, which of course, is untenable for a major organization.
And so that's created, again, an upward swing in demand because Rimini Street offers the only really proven global solution for large enterprises to make that move and continue to use the product for years to come.
The other area, we saw a lot of growth in is the sales force managed service. Again, Salesforce is a big complex platform, requires additional work and support just like any other enterprise as platform and Rimini Street's well positioned to provide those services to clients even to other big service providers like NTT. who utilize US demand as their sales force platform.

Daniel Hibshman

And then maybe last for me just on the you already spoke some to the cost structure expectations for 24, but specifically on legal professional, just any thoughts on how we should be expecting that similar year in 24 relative to 23? And then the $9.7 million, was that already paid out? And where would I be seeing that on the financials?

Seth Ravin

Yes, I'll let Michael answer to see the $9.7 million on the financials, but that was a settlement of legal fees between Oracle and us. We settled that rather than continuing on in the court, and that was already reserved to a significant amount. I believe that was already reserves somewhere in the $6 million that Michael can answer that. So there was an additional amount, but we had already we had already looked at that, and that's where we came to a conclusion.
But that ended the end of the contempt, a component of the of the trial sites. So at this point in time, as we always say, when we don't have a trial year, which 2024, there is no trial and we do have the appeals that are pending that I mentioned in my prepared remarks. And those will continue through the process but to the District Court as well as the appellate courts.
But that generally generally does not add up and to the kind of costs that you see when we have a full-blown trial. So I think when you look at the costs, we mentioned about how in Q1 24, we had paid out a significant amount of legal bills relating to the Oracle trial in late 2022. So I think you could take that back and you can you can notice that we probably would expect more moderate fees coming into 24 from what we've seen in that fee structure.

Michael Perica

And Michael here. Just to, as Seth noted, in Q4 2023 of the $4.3 million of legal related expenses, $2.7 million was it associated with the settlement. The total set settlement, As Seth noted, was $9.7 million, and that cash was also dispersed in Q4 of last year. We previously on in excess of 18 months ago, reserves, $6.9 million of the total $9.7 million. So that's the timing, if that helps.

Daniel Hibshman

I have that straight back to the details, and that's it from me.

Michael Perica

Thank you.

Operator

(Operator Instructions) Derrick Wood, TD Cowen. Please ask your question.

Derrick Wood

Yes, okay. Do we lose someone to open up his line again? Just second, please. Okay.

Operator

That is a route.

Seth Ravin

Sorry, go ahead and replace where you go.

Derrick Wood

Right. And the efforts for Artisan's coal on for Derek. On the total customer count was down quarter over quarter. I mean you guys mentioned that the NRRD. cell for DonTech rather was mostly from pressure where customers were ending kind of subscription on on certain products, but staying on others.
So kind of help me bridge. You know, our saw is some of the NRR pressure from customers just totally going after many platform on as seen in the total customer count numbers, it kind of these are smaller customers churning off and the larger ones that are hitting at are still customers down the debt.

Seth Ravin

I think you got it. You've got a mix, you've got some customers rolling off. And I think what we saw really through 24. Some of this is related to the pandemic. We had customers who were in the process of moving off who had extended the life of their products for a few more years. So I think 24 was a bit of an interesting year, some customers who had extended finally moving forward.
Those projects that have been delayed during the pandemic. And I think that was a little bit more of the roll off that you saw in this was some delayed roll off that might have been in prior years. So I think that that is a catch-up component and I didn't see anything during the year that was otherwise alarming or in any way, saw a trend. We didn't see that you have, for example, PeopleSoft, JD Edwards and Siebel clients. Those three platforms have been unsettled. There is no future product for those folks.
They have to change to another product when they move off these platforms, they will completely move to something new. And so you are seeing some sunset of some of those people moving. That's natural in a sunset on a product line. And then again, you see others who are coming on board.
So I don't think if there's any real trend here that differs year over year, I just think you have some ups and downs. And if you look at some of the bigger losses that happened, as I mentioned, related to management changes of M&A, where they decided to go a different direction. You have some of them where they had some internal issues that they needed to address in terms of dropping this product line.
Adding another, we had one large client who dropped a large component, but also added in the same week, a large component. So this is part of what you get when you when you service a customer on a wider portfolio, there will be ups and downs in terms of what they sign up for what they drop, other living, breathing moving organizations. And there's nothing for cause and about what we do.
And sometimes those will be bigger pieces. Sometimes they'll be smaller, but we didn't see any trend in terms of what we saw in the fourth quarter versus the rest of the year in terms of total clients, part of what you're watching is we launch so many new products that we had our sellers over rotated into cross-selling existing clients rather than bringing on new logos, not a comp, not an uncommon problem when you expand out a portfolio and it's popular with your existing client base and it's easier money.
So we are putting incentives in place in 24 to incent sellers to take the tougher road of going out and bringing in new logos. And we're working on a multiple set of programs to drive and rotate back to more new logo acquisition, you saw the number there was a small increase in total new logos. That's exactly what you're watching. It's all the cross-sell activity, it's over rotated and we need to balance it better in 24.

Derrick Wood

Great. Super helpful. And then just one more for me. In terms of the sales force and reps with remaining custom coming online here on how you're getting reps up to speed so that they can sell into the existing customer base and go out and sell new customers on the new on the new portfolio here, it is already been trained for the sales team.

Seth Ravin

They've already received training for. We just had our sales ready SKO kickoff just literally weeks ago in early January and where they did learn about custom, they've learned about all the different product lines. It was a fantastic week of learning and training for the global organization, over 400 people from the global revenue organization from all the countries around the world were together led by our sales and revenue enablement organization.
So I'm very confident in our ability to go out and position these products remaining customers, unlike anything else we've ever launched, it's basically opening the door and saying remaining ST is the best provider of enterprise software support in the world. And we believe we are also the best provider of the managed service for those products.
And because we have our secret sauce of systems processes, the technology, the people that we're able to use, we believe we can provide service to a wide variety of products that we've never offered service for.
And that is, again, an amazing offering of opening the door and saying bring us your enterprise product. If you want to get it supported, you want to get it managed. You want us to extend the life you want to get better service on it. We believe we can do that better than anyone else on just about every enterprise product out there.

Derrick Wood

Helpful off the floor. Thank you.

Seth Ravin

Thank you.

Operator

And there are no further questions at this time. I will now hand the call back to Mr. Ravin for the closing remarks.

Seth Ravin

Great. Thank you so much, everyone again, for joining us on the fourth quarter at 23 earnings call and full year earnings call. I want to thank all of our Rimini Street colleagues once again for their great efforts over the past quarter and the year, it was a magnificent year of change and growth for the Company and repositioning ourselves as a much larger enterprise player.
We look forward to having all of you join us on the next earning call. I will discuss the first quarter 2024 results. And as you know, that's coming up pretty quickly and select Second Quarter 2020 for performance to date commentary as well.
Until then I wish you and yours a continued good health, our thoughts and continued charitable support for those in need and then walk around the world. Just always remembering we generally have it so much better and so many others suffering in an arms way. So with that thought, thank you very much, and have a good day.

Operator

Thank you. Ladies and gentlemen, the conference has now ended. Thank you all for joining. You may all disconnect.