Question Bank › The leak is fixed: the company is keeping what i

The leak is fixed: the company is keeping what it used to lose

Calls Tested
463
Answered YES
5
Hit Rate
1.1%
rare by design

Toast, Inc. (TOST) — this company's answers

NO on the Q4 2022 call 2023-02-16 C+
The model's full reasoning — Q4 2022 call → NOWe need to determine if management conveys a recent and material reduction in the rate of losing what it already has (customers, revenue, product, people). The transcript mentions churn, retention, etc. Let's scan. Elena Gomez: "Our 2022 performance resulted in a total net retention rate, or NRR, of 118%. That's down from 135% in 2021. As a reminder, we anticipated the decline since 2021 benefited from GPV recovery and higher margin debit and credit non-present volume during COVID, which stabilized in 2022. Our SaaS NRR increased 5 points to 128%, driven by our momentum and upsell, location expansion from existing customers and low churn." So SaaS NRR increased 5 points to 128%. That is a retention improvement. But is it described as a change from past? Yes, SaaS NRR increased. Reason: momentum, upsell, location expansion, low churn. But is that a material reduction in outflow? It's an increase in net retention rate, which includes upsell and expansion, not just churn reduction. The question specifically asks about "losing what it already has" - i.e., churn, cancellations, etc. The transcript mentions "low churn" but does not quantify a change in churn rate. The increase in SaaS NRR is driven by upsell and location expansion, not necessarily a reduction in churn. Also, total NRR declined from 135% to 118% due to COVID effects. So the overall retention went down, but SaaS NRR went up. However, the question asks if management conveys a recent and material reduction in the rate of losing what it already has. The increase in SaaS NRR is partly due to upsell, not just keeping customers. Also, the reason given is "momentum and upsell, location expansion from existing customers and low churn" - that's not a specific fix or change in the business that reduced churn. It's more of a general trend. Also, the transcript does not mention any specific action taken to reduce churn. The question requires that management presents the improvement as a change from the company's own past experience and with a reason behind it that management believes will hold, such as a product fix, etc. Here, the increase in SaaS NRR is noted, but the reason is not a specific fix; it's just business momentum. Also, the overall NRR declined. So I think the answer is NO.

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Show the exact prompt the model was given
Using ONLY the supplied earnings call transcript and no outside information: On this call, does management convey that the company has RECENTLY AND MATERIALLY REDUCED THE RATE AT WHICH IT LOSES WHAT IT ALREADY HAS — that is, an outflow of customers, revenue, product, or people that the company historically experienced has narrowed in a way management treats as a real and durable change in the business, grounded in something the company did or fixed? Answer YES when management's own words convey, in whatever form fits the business, ONE coherent development: the company is now keeping customers, revenue, product, or people that it used to lose, and this is already observable in the current business. The outflow may take whatever form fits the industry, and any genuine expression of this counts — for example: customers cancelling, not renewing, or drifting away at materially lower rates than before; renewal, retention, repeat, or reorder behavior stepping up beyond the company's own historical norm; revenue or contracts that used to roll off now continuing; products being returned, failing, or generating claims or rework at materially lower rates; patients, subscribers, or members staying on longer than they used to; tenants, distributors, or partners defecting less; employees or key people quitting at markedly lower rates. Management should present the improvement as (a) a CHANGE from the company's own past experience — not merely a standing feature of the business, and not merely better than competitors or better than feared — and (b) something with a reason behind it that management believes will hold — such as a product, quality, reliability, service, or fit problem that was fixed, a change in who the company serves or how it serves them, or a structural feature now binding customers more tightly — rather than as a lucky quarter. Answer NO if the company simply reports strong retention, loyalty, low churn, or low returns as an ongoing feature of the business with no described improvement versus its own past. NO if the improvement is attributed mainly to a price increase masking losses, a shift in customer or business mix, a one-time event, or normal seasonality. NO if the reduced outflow is only hoped for, targeted, or expected in future periods rather than already observed. NO if the only improvement described is in winning NEW business, with nothing about losing less of what the company already has. NO if the idea appears only in an analyst's question that management does not itself affirm. Use only the supplied transcript. Answer only YES or NO.

Companies that answered YES

TickerCompanyCallDateCall grade
LRN Stride, Inc. Q1 2019 2018-10-23 B
MKC McCormick & Company, Incorporated Q2 2018 2018-06-28 C+
BCOV Brightcove Inc. Q1 2018 2018-04-26 B+
TOUR Tuniu Corporation Q4 2017 2018-03-14 D
BCH Banco de Chile Q3 2016 2016-10-30 B+

How the model reasoned

MKC · Q2 2018 → YESThe question is: Does management convey that the company has RECENTLY AND MATERIALLY REDUCED THE RATE AT WHICH IT LOSES WHAT IT ALREADY HAS — like customers, revenue, product, or people? **YES** Management explicitly describes stabilizing French's mustard distribution points after years of decline, framing it as a reversal of inherited losses through category management efforts (removing duplicative secondary brands, expanding French's share).
BCOV · Q1 2018 → YESThe question is: Does management convey that the company has RECENTLY AND MATERIALLY REDUCED THE RATE AT WHICH IT LOSES WHAT IT ALREADY HAS — like customers, revenue, etc., a real and durable change. ...YES The transcript shows management explicitly linking the 103% recurring dollar retention rate (a multi-year high) to the completion of the commodity pricing reset in the media business.
LRN · Q1 2019 → YESThe question is: Does management convey that the company has RECENTLY AND MATERIALLY REDUCED THE RATE AT WHICH IT LOSES WHAT IT ALREADY HAS — like reduced churn or improved retention that's a real cha...

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Not investment advice. Artul.ai publishes AI-generated earnings-call quality grades and expected-volatility estimates — never buy or sell recommendations. We tested over 1,600 predictive hypotheses against 165,000 transcripts; the honest result, including what failed, is documented in our methodology.