Welcome to the NICE conferencing call discussing Second Quarter 2019 Results, and thank you all for holding. All participants are at present in a listen only mode. Following management's formal presentation, instructions will be given for the question and answer session. As a reminder, this conference is being recorded, August 8, 2019. I would now like to turn this call over to Mr.
Marty Cohen, VP, Investor Relations at NICE. Please go ahead.
Thank you, operator. With me on the call today are Barak Elam, Chief Executive Officer Beth Gaspich, Chief Financial Officer and Eran Aron, Executive Vice President, Marketing and Corporate Development. Before we start, I would like to point out that some of the statements made on this call will constitute forward looking statements in accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 19 95. Please be advised that the company's actual results could differ materially from these forward looking statements. Additional information regarding the factors that could cause actual results or performance of the company to differ materially is contained in the section entitled Risk Factors in Item 3 of the company's 2018 annual report on Form 20 S as filed with the Securities and Exchange Commission on April 5, 2019.
During today's call, we will present a more detailed discussion of Q2 2019 results and the company's guidance for the Q3 and full year 2019. Following our comments, there will be an opportunity for questions. Let me remind you that unless otherwise noted on this call, we will be commenting on our adjusted results of operations, which differ in certain net respects from generally accepted accounting principles, as reflected mainly in accounting for acquisition related revenues and expenses, amortization of intangible assets and accounting for stock based compensation. The differences between the non GAAP adjusted results and the equivalent GAAP figures are detailed in today's press release and I'll turn the call over to Bharat.
Thank you, Marty, and welcome everyone. I'm glad to be on the call with you today. We are pleased to report another strong quarter across the board, including all key financial metrics. Total revenue increased 11% to $381,000,000 driven by another strong quarter in both product and cloud revenue. Product revenue increased 25% and cloud revenue grew 30% in Q2.
The strong top line results led to a further increase in profitability. Operating income was $101,000,000 which was an increase of 14% compared to Q2 last year. And operating margin increased 74 basis points to 26.6% compared to the same period last year. These strong operating results led to a 14% increase in earnings per share to $1.25 Our success continues to be driven by an acceleration in cloud, analytics and AI. The cloud growth was very strong in both customer engagement and financial current compliance and is being fueled by penetration into all segments of the market, including large enterprises where we have witnessed robust demand and strong growth.
Meanwhile, we are seeing significant expansion of our partnerships around the globe and at the same time maintaining an acute focus on product innovation. CXone continues to drive the success of our cloud business. CXone is unique in that it is the first and only true native cloud platform that seamlessly incorporates the market leading omni channel routing, workforce optimization and analytics into single platform. Last quarter, we announced the acquisition of Brand Embassy, which provides a significant expansion to CXone and makes it the most comprehensive platform for digital transformation in customer service. The new offering has already been launched to the market.
We continue to sign many new cloud customers across multiple segments of the market, including some very large enterprises. The deal included an 8 digit ACV deal with a financial services company, which was an end to end replacement of several on premise providers. We also signed multiple 617 digit ACV deals. For example, we closed the deal with a brokerage or investment advisory company, which is a new customer and a competitive replacement. We signed a deal with 1 of the largest retailers in the world as they continue to expand the relationship with NICE.
There was another deal with an energy company, also a new customer and a competitive replacement, as well as an expansion deal with a state government agency where we replaced the incumbents. X Sight grew meaningful cloud growth for financial crime and compliance. Large deals in the quarter for our Essential cloud based solution included a global digital bank, a Canadian based credit union, a U. S.-based bank specializing in small business lending and a leading online brokerage firm. Augmenting the success of our cloud growth is a significant expansion of our ecosystem of partners, which is being fueled by our extensive portfolio of solutions and the large and increasing total addressable market in which we operate.
One example is our CXone partner ecosystem through our DEV1 and NCX exchange program. We now have 135 partners building on the platform. This extensive network provides our customers with endless solutions options. At the same time, it offers our partners the means to significantly expand their go to market and provide us an excellent vehicle for M and A similar to our acquisition of Brand Embassy, which was a DevOne partner. We also have many successful go to market partnership with various UCaaS providers, telcos and other resellers that allows us to cover the fast growing market.
This network continues to constantly expand and we are now further augmenting our partnership strategy with the recent announcement of a partnership with Ethos, a global leader in digital transformation with over 110,000 employees in 73 countries. Atos is making CXone a preferred solution for contact center as a service and bringing CXone to the company's installed base of 100 of 1000 of contact center agents across the globe as well as to new customers. With Etos' largest global presence, we're excited about the potential to bring CXone to new customers around the globe, especially in Europe where SaaS has very large customer base. This is a great opportunity to execute on our of growing CXone in international markets. We also recently announced an expanded collaboration with Microsoft.
We introduced new integration for Microsoft Teams, which is further enabling organizations to effortlessly collaborate with the contact center. Similar to the CXone Marketplace, we announced the Xcyte Marketplace, the industry's 1st financial crime management focused marketplace. The X Sight Marketplace initial solutions category includes ID verification, ultimate beneficial ownership, value added data and adverse media, watch list, device identification and user authentication and fraud. Since the announcement of the new X Sight Marketplace less than 2 months ago, more than 20 solution providers have already signed up, including a specialist in cybersecurity, a provider of unique live streaming technology for biometric on boarding and a provider known for its AI powered risk management content solution. Along with partnering, we also continue to accelerate innovation, especially around analytics and AI.
In RPA, where we are seeing strong growth in very fast growing market, we recently released a new version of RPA. This latest version incorporates deeper AI capabilities for extended automation discovery and real time monitoring intelligence. In fact, Knight RPA was named the leader in Everest Group's peak metrics for the 2nd consecutive year, scoring high on both vision and capability and market impact. The most recent release of and end to end artificial intelligence capabilities included our new AI self-service bot options, new AI infused focusing and scheduling options and AI powered interaction analytics. We've also added predictive behavioral routing for CXone.
Moreover, CXone now provides additional depth and breadth of CRM integration for delivering a more personalized customer experience. Another example of innovation includes the introduction of Actimize CDDx, which modernizes KYC and CVD programs with advanced analytics and the power of AI. Knight's optimized PDD app leverages optimized watch to apply machine learning to enhance the accuracy of risk rating using the collective intelligence of previous outcomes. Significant reduction in operational costs are realized for the innovative use of utilization and purpose built intelligence information to streamline customer view time by up to 70%. In Q2, we continue to sign several 7 digit deals incorporating cutting edge analytics, including 2 large deals with healthcare companies that included our analytics part compliance center solution.
Seadieu included many including many others during the quarter with competitive replacement. We also signed a 7 digit deal with a major card processor for a portfolio of our financial climate compliance solution and a 7 digit deal with a major reinsurance reinsurance and health solutions company for Interaction Analytics. This company is already a CXone customer and this deal demonstrates the value of our customers' ability to extend on our platform. We also signed a 7 digit analytics deal with 1 of the largest cruise lines in the world. In closing, we have the market leading technologies driven by ongoing innovation through profoundly market differentiating cloud platform which CXone and X Sight and robust go to market, unified enterprise cloud direct sales force and strong and expanding partnership.
We are only just beginning as these assets position us very well to capture the many growth opportunities ahead in an addressable market of $7,000,000,000 growing to over $12,000,000,000 over the next few years. I will now turn the call over to Beth, who will review our financial results.
Thank you, Barak, and good day, everyone. I'm pleased to provide the analysis of our financial results and business performance for the Q2 of 2019 as well as our outlook for the Q3 and full year 2019. Total revenue for the Q2 increased 11% to $381,000,000 compared to 3 $44,000,000 in the same period of last year. Our total revenue growth was driven by further growth in the cloud with 30% cloud growth in the Q2 of 2019 as well as an increase of 25% in product revenue. Our high percentage of recurring revenue continued to increase to 72% of total revenue reflecting our strong cloud momentum.
As we highlighted last quarter, our recurring revenue has grown to become a much larger portion of our total revenue. Therefore, we expect both our revenue and our profitability to be more evenly distributed among the quarters this year. We also witnessed double digit growth in both of our businesses. Customer engagement revenues for the 2nd quarter increased 11% to $313,000,000 and represented 82% of our total revenues. Financial Crime and Compliance revenues increased 10% to $68,000,000 and represented 18% of total revenues.
Product revenues accounted for 16% of total revenue in the 2nd quarter. Cloud revenues accounted for 38% of total revenue for the 2nd quarter, which represents an increase from 32% in Q2 last year. And services revenue accounted for the remaining 46 6% of total revenue in the Q2 of 2019. Looking at geographies, Americas reached $307,000,000 in the 2nd quarter, EMEA $48,000,000 and APAC $26,000,000 in the Q2 of 2019. And now to profitability.
Gross profit increased 12% to $271,000,000 in the 2nd quarter. Gross profit margin improved to 70.9% compared to 70.5% last year. The expansion in gross margin is a result of product mix. Cloud gross margin increased to 61.4% from 59.8% in Q1 2019. Operating income increased 14% to $101,000,000 in the 2nd quarter.
Operating margin increased significantly to 26.6% compared to 25.8% in the same period of last year. The strong operating income and margin demonstrates the leverage in our model and our commitment to continue to expand profitability over time. Earnings per share for the Q2 increased 14% to 1 point Q2 of last year. Total cash and financial investments were $867,000,000 at the end of June 2019 and total debt was $460,000,000 net of issuance costs and the equity components associated with our convertible debt. I will conclude my remarks with our guidance.
For the Q3 of 2019, we expect total revenue to be in a range of $380,000,000 to $390,000,000 We expect Q3 2019 fully diluted earnings per share to be in a range of $1.23 to 1 point $3.3 We are increasing full year 2019 revenue to be an expected range of $1,563,000,000 to $2,583,000,000 We are increasing full year 2019 fully diluted earnings per share to be in an expected range of $5.13 to $5.33 I will now turn the call over to the operator for questions. Operator?
Thank you. And the first question we have from the line of Shaul Eyal from Oppenheimer and Co. Thank you, Shaul. You're live in the call.
Thank you so much. Good afternoon, guys. Congrats on the performance and the outlook. Barak, the number of 7 and 8 digit transaction keeps showing healthy momentum, but it's actually coming also from cloud related transactions. So I think that it would appear that the prior view a couple of years back was that cloud contracts are probably on a smaller scale, but you're actually showing us the opposite, and it's not only on CXone, but on X Sight as well.
So help us reconcile this view. Is it rapid cloud adoption? Is it that enterprises are showing increased readiness to the touch solutions? Is it improved TCO? And I have a follow-up.
So the question. Indeed, I think that you can see a growing trend in our last few quarters and this quarter it's even more so about the both the number as well as the magnitude in terms of size of our cloud deals. I spoke about an 8 figure ACV deal and multiple 7 figure ACV deals in the cloud. And I think that the reason for that is a few reasons. First of all, the market adoption at the higher end of the market for cloud is growing dramatically.
And we believe that we are taking a big share of that. So the first one is the adoption. The second thing that I would say is a combination of a few things. First of all, the fact that we are selling much more portfolio deals. The fact that the NICE portfolio is very complete with both CXone and X Sight.
It gives us an opportunity to sell much larger deals with much more components. And we believe that the market is buying into our vision and strategy that it makes much more sense to go after the integrated set of solutions that we have given the steps that you've taken as a company. The second thing is the fact that it is a platform. It's much easier to consume it and people are investing into the platform. And because of that, we see much larger deals and much stronger long term and larger commitments from customers.
And third, I think that there is a much more or better realization of customers and that our solution is through native, real native cloud solution versus some of what our competitors came out with a semi cloud hosted solution and other things that they are defining cloud like or semi cloud or financial as well as the market and the market just doesn't buy it. And I think that you can see it in the multiple competitive replacement that I've mentioned on the previous remarks.
Understood. Understood. And I have a follow-up, Barak, and maybe also Ramli Ron would like to comment on it. So yes, last night, we've all read about the acquisition of ClickSoftware by Salesforce. Most of you know the inside out of Click.
We know it, its history. We also know the people at Francisco Partners, some of which come with a strong nice route. And I'm not suggesting Click is a competitor to you guys, but it has been playing in some adjacencies on the workforce optimization front. My question is, what are you seeing happening strategically in this place? Is it that the big CRM guys are beginning to wake up and realize the benefits of workforce optimization, cloud related capabilities?
Yes. We saw the news similarly to you. While personally, we know the company, ClickSockets, from the past, they are in very remote areas to what we're doing. They are, as I know from the past, doing much more work for optimization for sales support. It's different than what we are doing.
We are not competing and not cooperating with them. So I don't think it has an implication on our specific domain. There is some synergies, I think, between CRM and ClickSoftware. I think they even had partnerships in place. So I assume it makes sense for Salesforce.
But I it's hard for me to further relate to that because it is the motto to what we're doing as a company.
And your next question is now from John DiFucci from Jefferies.
I have a question. I think the first one is for Barak and Beth and then maybe a follow-up for Beth. So the product was strong again this quarter and I know that you're just going to say we shouldn't that will be that will move around a lot from quarter to quarter. But I assume that maintenance is also strong again this quarter. And I just want to verify that.
And if so, I think that implies that pro services was relatively weak in the quarter, at least weaker than what we were looking for. And if that's the case, was it simply a difficult comp, which it was? Or Barak mentioned, as Shaul said, all those large deals, but also in the press release, you mentioned DATOS and I think you might have said in the prepared remarks. Should we perhaps expect more of this going forward as you move pro services more to partners, if that's what's happening?
So John, I'll take this to begin with. I think I'll highlight a few of the comments that you made. First, starting with the product growth. As you highlighted, I have mentioned on several occasions that we should expect to see variability in the product revenue. And of course, we're very pleased with the revenue growth we've seen in our product revenue in the first half of this year, 25% in the most recent quarter.
And I think it's further evidence is really that, as we've said all along, the cloud revenue that we're bringing is really incremental to our business. And so you will continue to see strong growth quarters, but at the same time have some variability. As you look on the services for the specific quarter, our maintenance is consistent and we have a healthy retention of our maintenance business. And if you look specifically on Q2 of last year, you'll see that we actually experienced 13% growth in the Q2 of 2018. And that was related to our professional services, where we had some specific milestones we were able to recognize during that quarter.
So it was a difficult comparison in comparison.
Okay, great. Thank you, Beth. Maybe Barak, should we start to see, like you did mention the Atos partnership in the press release, should we start to see perhaps more of that professional services going to partners?
No, I don't think that, that will have any meaningful impact on professional services. For us, it's different partnership we're signing like the one with Equus, which I believe is very strategic one for us. It's, 1st of all, very much of an incremental business. And even with that, they will be required to have our professional services. Already today in our business, there is a lot of partners doing services, so it's not necessarily taking what we are doing as a services.
So I don't see a change to the model as a result of that. The reason why we are signing those partnerships is that the market is growing very, very fast in multiple segments, and we would like to be able to extend our go to market. We can do it by ourselves to a certain pace if you would like, but definitely partnerships are helping us to take to have a much better coverage in the market.
Okay, great. And if I might, just the question for Beth. The results look really good. It sounds like all the other anecdotal evidence sounds great. But one of the line items that I know I'm going to get questions on is cash flow because that was materially below our estimates.
And it was mainly due to underperformance of receivables and prepaid expenses and others. So I just want to make sure I understand that. Given how your model works and you build like CXone monthly in arrears, And it sounds like you had some a lot of big deals here and Barak mentioned several of them. Is it fair to assume those deals were back end loaded as large deals typically are? So you got little revenue in the quarter and it doesn't go to deferred revenue with that business, but you pay commissions upfront and even if you recognize the commissions over time.
So I just want to because that makes sense to me, but if that's wrong, tell me what else is happening?
Sure. So thanks. You actually highlighted several things which are true. I think if I just break it down, first of all, if you recall, we actually had a record cash flow from operations in the Q1 of $182,000,000 And so we decided to take advantage of that strong cash flow and we entered into several agreements that were prepaid expenses where we can lock in discounts and that will benefit us really going forward into the future. That combined with the comments you made, which is true, that we do have commissions, which on these deals that Barak referenced were primarily revenue that you'll see looking forward, and they do come with commissions that sometimes are paid in advance.
Great, great. Thank you. Nice job.
Thank you. And the next one now from Dan Ives, Wedbush Securities. Thank you, Dan. You're live.
Yes, thanks. So my question on the fraud detection, the optimized piece. Just talk about are you starting to see deal sizes more transformational or larger just the regulatory environment starts to change? Is that something where you may be seeing an inflection on that area of the business?
Yes. Thanks for the question. Yes, We definitely see traction over there. The market continues to be very attractive. And with the launch of 2 things.
1st of all, X Sight is growing our addressable market. And through the platform, we manage even with existing customers to expand our footprint and go beyond the traditional fraud solutions that we have and fraud continues to evolve. So that's one element. The second that I've mentioned is the cloud adoption, similarly to what we have started to see, let's say, about 3 years ago or so, 2.5 years ago. On the customer engagement side, with a strong demand that started to cloud, we now see it on the Aktimize front in our Financial Crime and Compliance business.
And we were prepared for that. Hence, you see the nice growth also on the cloud and data part of the business, which allow us to bring innovation much faster into the market, specifically around fraud, as you have mentioned. And the last part is, again, taking a very similar approach, and we're very much in a positive way surprised with the traction, we launched the X Sight and Marketplace just 2 months ago. And in the course of just 2 months, we have an outstanding demand and we've managed in 2 months to sign up more than 20 partners. And I believe this will continue to grow dramatically, which will allow us to provide much more complete and holistic solution for our own innovation in the marketplace around fraud to this growing market with financial services.
Thank you. So your next one is from Rishi Jaluria from D. A. Davidson. Thank you, Rishi.
Guys, this is Hannah on for Rishi. Thank you for taking my questions today. Just first off, it sounds like you're getting a lot of new customers on the CXone and X Sight platforms. I was wondering if you could talk about what kind of traction you've seen in terms of converting some of your on prem customers to the cloud?
Sure. So as you've heard from my comments and some of the deals that I highlighted, many of those customers are new customers. Many of the new customers are competitive replacements. Some are replacing specific competitor and in some places, given that we're selling a pretty wide portfolio, our customers are actually replacing several competitors at the same time. So that's many of the things that I've highlighted on the call.
At the same time, we see an extension and migration to the cloud of our own customers. In some cases, they decide to have some of the solution on premise and some in the cloud, but in other cases, they migrate completely to the cloud. When they do that, we see a significant increase of the annual revenue from such a customer. And I think that you can see it from our results this quarter and last quarter as well that while the cloud is growing, product is also moving very nicely in the right direction.
Great. That's really helpful. And then second, I was interested to see you guys were recently ranked 4th in terms of RPA revenue by Gartner. I was wondering if you could talk about if you're seeing any changes on the competitive front
there. So I think I've mentioned in my remarks, we see this market as a very interesting market, a lot of activity in this market. It's a highly fragmented market with dozen, if not more than that of theirs. And we're very happy to be rated among the few leaders in this market. We believe that we have a very robust technology that allows us to serve not just the classic unattended RTA of the market, but much more so and much more strategic and interesting, the unattended part of the market, the attended and solely part of the market, which is, we believe where the future of this market is heading.
And indeed, we see multiple opportunities. When you come with our attended robotics automation, our win rate is going significantly up. And I think this market, while it is a very interesting market, it's still in its infancy, and there is a tremendous opportunity for us in this market.
And your next question now from Paul Coster, JPMorgan.
Barak, a couple of sort of strategic questions. One is, if you look at the geographic mix for a company that's been around a long time, it really does feel very heavily skewed towards the Americas. And I'm just wondering why is that? And what do you think do you feel like there is more growth accessible to you in EMEA and APAC? And will you start ramping up the organization to go after those regions?
Any comments on that geographic mix would be
helpful. Sure. As you can see from our financials, that didn't change dramatically. Very strong believer that in our market, the U. S.
Market represents great opportunity, both historically and also into the future. Yes, the international market provides tremendous opportunity as well. And in deed, we have started to invest more in very specific areas of international markets. The announcement of the Ethos relationship, their go to market efforts and the different assets that they have, and their go to market efforts and the different assets that they have are in Europe. So that's just one example.
And I believe that you'll see in the near future more and more of the announcements and activities that we are doing internationally, which will eventually, we believe, will allow us to further fuel our growth in international markets.
Got it. Makes sense. And the other question is that I think historically the firm has really sort of appealed to line of business buyers. And it seems to me though that you're assembling a lot of component technologies, robotic process automation, analytics and so on that might start to appeal more broadly in the enterprise IT context. So I guess the question is, are you seeing any change in the sort of mix, the demographics of your buyers?
Are you starting to appeal to enterprise IT directly?
Yes. So first of all, we have we operate in different solutions, but in a very well defined and large market. We have variety of buyers to our solutions. I think you characterized it correctly. Our buyers are historically more on the operational side.
But as we evolved throughout the years with much more analytics, AI and much broader platform, which is becoming more strategically. We find ourselves more often than not selling to first broader than just those buyers, both most of physical IT and strategic business, but also going much more up the chain. It's becoming now almost a daily habit or weekly habit of ourselves and myself or senior leadership to have casual conversations and business conversations with C level executives among the largest Fortune 500 company out there. So I think that the evolution of the company and especially the thing that we've done, including a lot of analytics and AI into our platform and our priority of our cloud solution, I think position us well to stay much higher in those cloud enterprises. All right.
Thank you.
Thank you. And your next question, thank you, from Sanjit Singh from Morgan Stanley. Thank you, Sanjit.
Thank you and thank you for taking the question. Brock, I wanted to revisit some of the themes around Analyst Day and particularly the 5 year target around cloud. When I look at the great progress this year, you're at 38% of revenue from cloud, when the product revenue is also growing really strong. And I think the mix is up about 6 points year on year. So just wanted to get a sense, it seems like cloud is progressing a lot faster.
And so do you think that we're going to cross that 50% threshold earlier than you expected? And what do you think that would imply in terms of the overall growth rate of the company?
Thanks for the questions. We are very every time we try to give not just the quarterly results or not just the specific guidance for the year when we can and it's the right thing to do. We also provide some more visionary and more strategic goals. We've done it back 'fourteen with the NICE 2020 plan, and then it's followed with the NICE to be. And indeed, in the Analyst, the latest Analyst Day, we provided some very, I would say, even specific metrics and KPIs of where we would like to be several years from now.
It's been only like, I think, a quarter since we announced it, and things are progressing, we believe, quite well. So we absolutely would be very happy to cross those KPIs much faster than the horizon or the timeline that we gave. But I think it's too early for us to update those numbers. But rest assured that if we believe that we will our pace will increase, we will do that similarly, by the way, to what we've done after 2014. I think we've done it in 2016 that we came with NICE 2020, and we update you after a couple of years that we believe that we are getting into the 2020 goals much faster than we thought.
So we definitely hope so, but I think it's too early to provide such an update.
Understood. Fair enough. And then sticking with some of the themes on Analyst Day, I think one of the initiatives that you had is moving down market with WFO, taking WFO and analytics more down market as well as using X Sight to extend the reach into other market adjacencies. Can you just give us sort of a progress update on those initiatives as you see it thus far this year? What sort of early signs do you see with respect to both of those initiatives?
Sure. I think that we are very happy with the progress of those two initiatives. I'll refer to each one of them a bit separately. So the first one is that we have a very strong and very healthy market share in WFO when it goes to the mid and higher end of the market. Historically, we did not pay in the lower end of the market.
But still the introduction of SysPh1, which is actually providing under one platform a fully integrated, only terminal routing, analytics and WFO, what we see is a very, very, very high attachment rate between those 3 as we go to this segment of the market. We're in contact, by the way, historically were very strong and still are very strong. So that is going very well and we see that attachment rate increasing quite dramatically compared to the first data we bought in contact. So the first one, which is, as you said, the down market place for WFO, 261 is going very well. The second one in X Sight, I think you can heard it from my earlier remarks, the essentials element, the cloud element of X Sight, the example that I gave of several customers that we've blended this quarter with X Sight Exscientio.
Just on describing those customers, I didn't give specific names, but you can see that this is not the classic, very large, high end global banks, although we had some business with them as well. Actually, we're so excited in the Accenture. We've managed to grow much lower in the market. By the way, lower but still pretty sizable financial services.
And the next one now from Chris Rimer from Barclays.
Hi. Thank you for taking my questions. Could you give some more detail on the partnership with Atos as to what products might be available to them and what kind of customer base you think that will generate?
Sure. So the announcement that we have made and what was signed with Ethos is a partnership around CXone. Atos has a very, very large customer base. Many of those customers, if not all of them, have customer service in contact center operation. Today, they have Ethos Unified Communication as well as Ethos legacy contact center on premise solution.
And basically, the partnership is to grow and offer those customers a migration to the cloud of those contact center customer service assets into CXone. Ethos build that customer base for many years of solid execution, and we're talking about an opportunity of 100 of 1000 of contact center agents. And most importantly, Atlas has a very successful go to market vehicle for both of their partner as well as, of course, their sales team. Atos is a very large corporation with 110,000 employees around the globe. And this is basically going to serve an extension, a very good extension to our own go to market, penetrating markets where we have either light presence or no presence at all.
Understood. Thank you. And Beth, just a technical question. Did you give the number of recurring revenues this quarter, the percentage? I might have missed it in your comments.
Sure. Thank you. Yes, we did give the recurring revenue. It's continued to increase. And this year, in the second quarter, it represents 72% of our total revenue.
Okay. Thank you very much.
Thank you.
Thank you. And we now have Pat Walravens from JMP Securities. Thank you, Pat.
Yes. This is Mark for Pat. Thank you Twilio Flex.
No, I don't think we can report on any change in the competitive landscape. We believe that in both markets where we operate, these are very healthy markets. They are growing very fast, and we believe, as you heard on our remarks, that we are taking a good share out of the market with a lot of competitive replacements. I prefer not to refer to any specific competitor or the one that you've mentioned, we don't see any change in the dynamics in the market.
Okay. Just one last one for me. So just regarding to RPA, so it's a relatively new technology. So just wondering maybe where do you see the technology add most value to customers? And maybe the technology doesn't work really well and doesn't live up to the expectation?
Anything you can share around there?
Sure. So it's obviously, it's clearly a valuable technology in the sense that enterprises today are looking on every possible opportunity to both streamline the operation as well as reducing the cost. And RPA is a classic way and actually the ultimate way to do that a very cost effective way, basically taking mundane tasks that do not necessarily need to be managed by human beings and take those microprocessors and sometimes macroprocessors or complete end to end processors and automate them in a very fast and rapid way. That's the basic promise of this technology. What's the evolution that we see in the market that it started as a market of what we refer to as unattended RPA, meaning that the robot is operating by itself at the back, taking a process without intervention.
And that provides a certain list of opportunities in the market. We believe this is very good, and we play in this segment as well. But where we see this market evolving more and more so into 2 areas. The first one is what I refer to as a tender automation, is where you put together the man and the machine or the man and the robot, and they exchange work together. Basically, the person is the one that's outsourcing, if you would like, quote unquote work to the robot.
And you take the best out of those 2 individuals or 2 entities, the robot and the machine. These are more complex operation and you need more complex technology. But when it works and it works, of course, it provides tremendous value, much more than just unattended automation. The second part is that we see and we add a lot of AI capabilities into RDA. We have introduced about a year ago a platform called Automation Finder, which is a fully automated powered by AI vehicle that allows to actually find automation opportunity, map them and deploy them.
And that's something that we see that we are ahead of the market and others do not have these capabilities. It gets a lot of traction and it allows us to increase our win rate quite significantly. I'll just mention the last one is the introduction of NIIVA, which is a virtual assist entity that allows us to further and more easily integrate RPA technology into the workforce in larger organizations.
Great. Thank you so much.
Thank you.
Thank you. So that concludes the questions at present. And I'll just hand back now to Barak. Thank you, Barak.
Thank you all for joining us today, and have a great week. Thank you.
Thank you.
Okay, everyone. Thank you. That concludes your conference call for today. You may now disconnect. Thank you for joining and have a good day.