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Executives

Michael Look - VP of IR

Josh James - CEO and Co-Founder

Mike Herring - CFO.

Analysts

Brent Thill - Citi.

Michael Huang - ThinkPanmure

Tom Ernst - Deutsche Bank

Brian Fitzgerald - Banc of America Securities

Imran Khan - JPMorgan

Keith Weiss - Morgan Stanley

Brad Whitt - Broadpoint Capital

Steve Ashley - Robert W. Baird

David Hilal - FBR.

Dan Salmon - BMO Capital

Omniture Inc. (OMTR) Q1 2008 Earnings Call April 30, 2008 5:00 PM ET

Operator

Good day, ladies and gentlemen, and welcome to the Omniture first quarter 2008 Earnings Call. At this time all participants are in a listen-only mode. We will be facilitating a question and answer session towards the end of this conference. (Operator Instructions)

I would now like to turn the presentation over to your host for today's conference, Mr. Michael Look, Vice President of Investor Relations. You may proceed, sir.

Michael Look

Thank you very much. Good afternoon and thanks for joining us today. Joining me on today's call are Mr. Josh James, our Chief Executive Officer and Co-Founder; and Mr. Mike Herring our Chief Financial Officer.

During the call, we will discuss Omniture's financial results for the first quarter ended March 31, 2008. By now you should have a copy of our press release, which crossed the wire approximately 45 minutes ago. If you'd like to review a copy of the press release, please visit our website at www.omtr.com.

Please note that we will be referencing both GAAP and non-GAAP financial measures and wish to note that GAAP reconciliation information is provided in the press release and on our website.

Also, we wish to emphasize that some of the information discussed during this call, particularly the information regarding our revenue and operating profit margins or profit targets, including expectations concerning GAAP and non-GAAP revenue and revenue growth; GAAP and non-GAAP net income and loss and adjusted EBITDA; business strategy; customer demand; market observations and future product plans are based on information available as of today, April 30, 2008.

We believe that some of the statements we will make on today's call include statements about the expectations I just mentioned, may constitute forward-looking statements within the meaning of Section 21(e) of the Securities Exchange Act of 1934 and Section 27(a) of the Securities Act of 1933. Accordingly, we wish to caution you that such statements are just predictions based upon current expectations and assumptions regarding future events and business performance and involve risks and uncertainties that could cause actual results to differ materially.

We refer you to the reports that the company files from time to time with the Securities and Exchange Commission, which are available on our website and contain and identify important factors that could cause the actual results to differ materially from those contained in our projections or other forward-looking statements.

Omniture undertakes no duty to update any forward-looking statements to conform the statements to actual results or changes in the company's expectations. Following prepared remarks from Mr. James and Mr. Herring, we will open the call up for Q&A.

Let me now turn the call to our CEO, Mr. James. Go ahead Josh.

Josh James

Thank you. Good afternoon and thank you for joining us, everyone. Q1 was another quarter of strong revenue growth and solid execution, as we kick off an important year for Omni.

I am particularly pleased that we are executing well on seeing synergies ahead of schedule from our recent acquisitions. The strength of our core business and the power of our financial model showed true as we delivered better than expected operating margins and non-GAAP EPS.

The macro trends that fueled our growth in previous years continued for us in 2008 with measurability, transparency, and customer satisfaction becoming increasingly important to companies as they push to increase in their marketing efficiency.

We have long said that measurability is one of the key promises of the internet. A promise that is not only relevant in times of hyper-growth for companies, but equally if not more imperative during times of less growth, when efficiency and effectiveness are critical. When companies can measure the results of their marketing, customer service and their customer engagement, they better understand where to spend money to acquire, convert, and retain customers.

At our analyst meeting in customer summit in March, we shared our vision for how we see our core competency of internet measurement or web analytics acting as a springboard for additional products. Understanding consumer behavior on a site has become an absolute imperative for our customers in their efforts to deliver a consistent, optimized, experience. That delivers high rates of conversion. Our go-to-market strategy has our products both current and future addressing three key aspects of the online business. One reporting and analytics, two, campaign management and three conversion.

We believe our position of managing the data for our customers enables towards all personalization and optimization and gives us not only the background and infrastructure, but also the influence and strategic position to deliver this end-to-end solution in the most robust way possible.

We also believe that independence or neutrality is an essential element for successfully addressing the growing needs of the online marketing industry. It enables our customers to keep the proprietary data about the business under their control and confidence, yet use the data to analyze the performance metrics of multiple technologies across all media channels rather than just a select field.

No matter how accurate a transparent data may be, if it suggests to the customers to spend more money with the same company that is providing that data for free, then customers want and need third party validation. Single channel analytics while valuable within their specific marketing channel, lacks the ability to allocate the contributions of multiple campaigns and technologies and can often result in marketers making the wrong conclusion about an individual campaign effectiveness due the limited and potentially biased perspective it offers.

While this maybe less critical in the long tail of the internet where fewer companies manage multiple channels, enterprise customers continue to demand customized solutions like the ones that Omniture provides to over 45,000 customers. Unfortunately, the more involved and integrated our solutions become, the more our enterprise application becomes as requirement for successfully running an online business.

Our AFI application is required because it is integrated with all the major search engines Ad serving networks, content management providers, email services providers etcetera. That is where our genesis program really it comes into play. By partnering with over a 130 of these companies, we are rapidly establishing a community of technology and service providers for the online industry.

And as the industry's leading online business optimization provider, we recognize our opportunity and responsibility for bringing together online marketers and these technology to develop the most capable, integrated learning and marketing suite.

We achieved a number of milestones towards realizing the strategy in our first quarter of 2008 that we believe will set the tone for the rest of the year. In January, we closed the Visual Sciences acquisition, adding approximately 1400 customers and also adding a new technology for advanced customer analytics to form a Visual Science product which is now called Discover OnPremise.

In February, we held our annual sales kick up and felt fortunate that the timing allowed us to bring Offermatica and Visual Sciences sales team into the Omniture family and educate the entire team on the products that are now available to all the Omniture customers.

In March and April we held various customer summits around the globe with over 4,000 attendees in total. 2,000 attendees in Utah and additional 2000 expected at summits in other locations, most of which have already occurred. We had the chance to share our vision for the Omniture platform to this global audience and have been very encouraged by the feedback.

Most of our strategy and our acquisitions are dictated and requested by our customers and the feedback that we have been receiving has been overwhelmingly positive. We have now several new products at our summit and also held separate sessions specifically designed to welcome a Visual Sciences and HBX customers.

The 4000 attendees at our summit is an increase of over 100% from the attendees we saw last year. This group of professional is not only remarkable in sheer numbers but also for the market power they represent including all 17 of the advertisers who spend greater than $50 million per year on line which is, by our estimate roughly 30% of this year’s global online marketing budget expense.

Let me take a moment out to update you on our Visual Science integration efforts as they continue to progress well and remained on track or ahead of track. We have reached out to 100% Visual Sciences customer base and have communicated a commitment to providing support to them going forward.

Today, we have solid customer retention. Rationalization to our headcount is complete and we focused on retaining key employees and making them feel like a part of Omniture. We are very happy with these individuals who joined Omniture in connection with the acquisition and they’ve shown a great enthusiasm for the future of the combined business. We retained over 90% of the people who were asked to stay as fulltime employees. We begin working with many HBX customers on their migration to SiteCatalyst.

As I mentioned before we used the timing of our customer summits around the world to reach out to many other customers in one-on-one meetings and had literally hundreds of HBX customers attend our summit in person.

We also have participated in numerous site visits and online webinars. Momentum for migration of these customers to SiteCatalyst continues to pick up and we are seeing up-sales and cross-sales to other Omniture products as a common theme.

To be clear we do not know have time line for the sun-setting HBX and to the contrary we are continuing to actively support the HBX customers and have committed to doing so going forward. It is not a hard sell or forced migration to SiteCatalyst for customers who are happy with HBX. We consider our job is to convince them to make the transition on their timeline, to demonstrate the new advantages of the decision, to move over to SiteCatalyst and making it easy and seamless as possible.

It is comforting to most customers to know that with Omniture, they are working with leader in the space. And with the company whose future and whose platform will live on for years to come versus one that may or may not be assumed.

Customers despise reaching solutions that can be avoided, accordingly with all the changes and uncertainty in the space over the last two years, choosing the leader has become even more important factor and the customer's decision to identify their long-term online business optimization partner.

The effort required to setup 2008 to be an outstanding year has been significant and I am very pleased with the results today. So I want to take this opportunity thank all those involved and congratulate them on the progress we've made in our first 100 days.

Omniture is a company that prides itself execution. Even though recently closed several acquisitions we made the appropriate investments in our integration theme internally that would allow us to change the landscape and scale of our business through this acquisitions, while continuing to support the growth machine that our core business has been for the last six years.

Momentum within our core business remains strong in terms of the nice base in which we can continue to invest in additional opportunities. Our Q1 finance results illustrate this continued momentum and the progress we are making for Omniture in what we believe to be our multi-billion dollar market opportunity. They also highlight the commensurate bottom line performance that results from disciplined financial management.

Total revenued for Q1 '08 was $63.2 million on a GAAP basis and $69.6 million on a non-GAAP basis. That's an increase of 117% and 136% over the same period a year ago. These results represent new levels of revenue for the company as they now include the impact of our Offermatica, Visual Sciences acquisitions, which closed in December and January.

I want to congratulate our sales and client care teams who have been driving such an excellent top win performance. It is indeed satisfying to see our team excelling with our core business, while we are absorbing the products customer bases and business lines of the recent acquisitions.

Organic revenue growth, which we define as revenue growth excluding the revenues from Offermatica and Visual Sciences was greater than 60% on a year-over-year basis, which we believe truly demonstrates that our core business remains very healthy.

The same execution effort delivered a non-GAAP operating margin of 10%, significantly up from 7% in Q4 '07.

This better than expected results was driven by strong leverage and economies of scale on our financial models and realized cost synergies from the Visual Sciences acquisitions ahead of schedule. We originally forecasted an 8% operating margins for the quarter. We had closed the Visual Sciences acquisition only days before and although we had a planned full integration and cost rationalization, we were conscious as to how quickly many of the synergies could be realized.

We are extremely pleased with how hard our integration team and our new Omniture employees have been working to bring the companies together and achieve this non-GAAP profitability benefit ahead of schedule.

Non-GAAP net income increased 59% sequentially in Q1 from Q4 of last year. I'm going to repeat that statement for our employees and our team members. Our Omniture team delivered to its shareholders a 59% sequential improvement in non-GAAP net income from Q4 of last year to Q1 of this year. This significant improvement in profitability is largely due to the leverage we are able to drive in core business in conjunction with the addition of the Visual Sciences and Offermatica revenue streams. The synergies created from combining the businesses as well as the benefits of increased scale are apparent and are possible because of the continued discipline financial management of the organization.

Turning your attention now to customer metrics; transactional volumes across SiteCatalyst customer base increased significantly from 619 billion transactions in Q4 '07 to 777 billion transactions in Q1 '08. With the addition of the acquisition of customers from Visual Sciences we ended up tracking over 852 billion transactions in Q1 '08. Our network now consists of more than 12,000 servers and nearly 15,000 network devices.

Bookings in the first quarter remain strong, coming off an all time record bookings quarter in Q4, as we are able to add roughly 1,400 customers with our Visual Sciences transactions and over 250 additional customers organically during the quarter. Plus, we had a substantial amount of upside into our current customer base.

That brings our total number of customers under management to over 4500 customers. We continue to achieve 95% annual customer retention rates. We are very pleased with the size and quality of the customers added in the quarter, a fact which is very important for the future growth of our business. Some of the notable wins in the first quarter of this year includes Kia Motors, Fox International, Sylvan Learning Centers, New Balance Athletics Shoe, Jones Soda Company, [Ballet School of Fitness], Nutrisystem, The American Cancer Society, Boingo Wireless, Ubid and Burpee Seeds.

Cross sale results in Q1 08 also continue to be strong, buoyed by our customer summit in early March where we had an opportunity to introduce and demo the power of our integrated product offerings.

Geographically international sales once again performed very well in first quarter with more than 30 major EMEA wins in Q1. Just a few of these notable customers include Henderson Global Investors, French Connection U.K, Yorkshire Building Society and Volkswagen.

Globally as our sales efforts continue to bear fruit, we continue to invest in our sales capacity. As of March 31, we had a 133 [QBSRs] up from 109 at the end of 2007, 25 of these came from the Visual Science’s acquisition and the remaining were hired during the quarter.

In closing; solid execution and continued momentum at our core business enabled us to once again deliver a quarter of strong financial results. As we believe our Q1 results demonstrate, we are not seeing or recognize any slowdown in our business or market, and therefore we will continue to focus on executing against our long term strategy.

That said, we understand that these are challenging micro economic times and I have been paying particular attention to the investments we are making. We will closely monitor sales productivity and customer behavior, and if necessary, we will make changes to our strategy when appropriate.

In conclusion, we have high expectations for ourselves at Omniture. We are executing towards meeting those expectations with focus and discipline. I would like to thank all he Omniure employees, old and new for their past and continued commitment to our customers into the company’s vision. I would now like to turn the call over to Mike Herring, our EVP and Chief Financial Officer who will go over financial results and our guidance in greater detail. Mike?

Mike Herring

Thank you Josh, we are excited about our first quarter results and believe we are well positioned for the rest of the year. Total revenues for the first quarter were $63.2 million on a GAAP basis and $69.6 million on a non-GAAP basis. Our non-GAAP revenues of $69.6 million were at the top half of our guidance range.

We saw strong growth in our organic revenue base as Josh detailed. We also incorporated a full quarters worth of the revenues from the Offermatica product and a little over three quarter worth of revenue for the Visual Sciences business, the acquisition which was completed on January 17, for a total contribution of $21 million in non-GAAP revenues from these acquisitions.

GAAP revenues were lower then previously guided, due to acceleration in the timing of some Visual Sciences deferred revenue adjustments, as well as the slight increase in the total adjustment after the completed analysis. The acceleration and adjustment resulted from the nature of perpetual license revenue involved and the payment terms profile of the deferred revenue balance. This timing of difference will be reversed in subsequent quarters.

We are particularly energized by the non-GAAP revenue achievement as it directly reflects the health of the SiteCatalyst business, the cross-selling opportunity and the ability to retain Visual Science and the HBX customers. As a side note, when we are transitioning the customers from HBX, there is an average of 60% up burst in contract value as they are not only transitioning over to their base services but also acquiring more advanced functionality and modules in SiteCatalyst and one to three additional products Omniture simultaneously with their upgrade.

GAAP net loss for the quarter was $12.9 million or $0.19 per fully diluted share, Q1 of ‘08 GAAP net loss are approximately $0.055 larger than originally expected due to the timing of the deferred revenue purchase accounting adjustments.

On a non-GAAP basis net income for the first quarter was $7.3 million for a fully diluted EPS of $0.10, above our guidance of $0.08 to $0.09 per share. We're excited to see the leverage of our financial model driving increased profitability as our revenue base grows.

GAAP to non-GAAP adjustment totaling $20.2 million were related stock based compensation, amortization of intangible asset and acquisition-related adjustments to deferred revenue and income taxed.

Breaking down Q1 income statement a little further product revenues for the quarter totaled $57.2 million GAAP basis, non-GAAP product revenues were $63.5 million and represent increases of 58% over the fourth quarter and a 130% of the same quarter last year. Product revenues are still a dominant portion of our revenue base comprising 91% of non-GAAP revenue and we expect this approximate distribution to continue going forward.

We talked about long-term non-GAAP product margins been above 70%. And we are excited that they are at that level today. Non-GAAP product margins improved to 72% with the addition of the acquired business and their slightly higher gross margin contribution as well continued leverage of the scale of the SiteCatalyst network.

We expect these margins will remain very steady over the next year as the customers migrate to the more stable and more redundant SiteCatalyst network, we will add data centers to our network and close others down. Long-term, however, we believe that we could continue to improve gross margins with continued increase scale. Professional services revenue totaled $6 million in the first quarter up 79% over the prior quarter and 230% compared to the first quarter last year.

Non-GAAP gross margins in professional services for the quarter were 52%, up significantly from 38% in Q4 and 36% in Q1 of last year due to the high utilization of our consulting staff and the relatively high margin contribution from the Visual Sciences services revenue stream.

International revenues totaled $17.1 million or 27% of total revenues for the quarter up from 26% in the fourth quarter despite the addition of the primarily domestic Visual Sciences business. This is an increase of 50% over the fourth quarter and a 159% compared to the first quarter last year.

GAAP operating expenses were $51.8 million. On a non-GAAP basis, operating expenses were $41.5 million or 60% of revenue. Sales and marketing expenses in Q1 '08 were 37% of revenues down significantly from 42% Q1 of last year, due to increased scale but up slightly from the 35% in the prior quarter as a result of customary Q1 sales and marketing events like the sales kickoff in our Global summit series.

R&D and G&A remained essentially flat from the fourth quarter at 11% and 13% of revenues respectively. Adjusted EBIDTA for the quarter was 12.2 million and 17.5% of non-GAAP revenue at the top of our guidance range. This is our eighth consecutive quarter of positive adjusted EBIDTA. As Josh indicated earlier on this call, we posted non-GAAP operating margins of 10% for Q1, up 270 basis points from the fourth quarter.

Let me a moment to discuss this topic a little more. Each quarter we make determinations as to whether to investment the incremental margin dollars generated back into business or drive to additional operating margin and earnings per share.

By comparing the percentages of revenues for each of our operating, in sense categories year-over-year, it is easy to see where we continue to invest and where our margins payments are coming from.

To simply summarize from Q1 '07 to Q1 '08, we improved non-GAAP gross margins through 67% to 70%. Sales and marketing decreased from 42% to 37%, R&D increased from 9% to 11% and G&A was flat at 13%, resulting in a 776 basis points improvement in operating margin year-over-year.

We are proud of the fact that we have been able to deliver on the top line through investment organically and through acquisitions while delivering on improved profitability. We don’t expect that non-GAAP operating margins can continue to improve at the same pace, but this track record and demonstrated leverage encourages us that over the long-term our profitability and margin model is achievable.

Turning now to our balance sheet, our total cash and investments at the end of the quarter totaled $86 million, a $48.7 million decrease from the $134.7 million cash balance we had at the end of 2007 and which reflects our purchase of Visual Sciences.

Accounts receivable was $82 million, resulting in a DSO of 107 days, which is a two improvement over the 109 days in Q4.

We generated $15.4 million in cash from operations for the quarter and CapEx for the quarter totaled $10.1 million for an adjusted free cash flow of $5.2 million. Healthy cash collection in overall business momentum as evidenced by deferred revenue growth, drove positive cash flow strength in the first quarter.

We have been and will continue to invest in our network infrastructure, both driven by growth of customer demand and desire to improve our network's ability to grow with increased and more efficient capacity. Towards that end, at the end of last quarter, we embarked on series of data center project in the US and internationally, which will add to CapEx and continue throughout the year. Although a significant effort on our part, the incremental investment of the growth driving capacity, we will make this year, totals about$ 4 million or less than 10% of our total booked CapEx budget for the year.

Our primary source of investment continues to be our employees and we ended the quarter with 985 full time employees. This is an increase of 272 people from last quarter, an increase of 520 people compared two year ago. This includes the addition of approximately 200 employees from Visual Sciences. As Josh mentioned we finished the first quarter with the 133 QBSRs.

Now turning to guidance; we are excited to be exiting the first quarter on track with our plan for 2008 and look forward to continuing to deliver on the expectations of our customers, partners, and investors.

We are raising our expectations for the second quarter and the balance of the year as follows. For the second quarter of 2008, we expect revenues to be in the range of $70 million to $72 million on a GAAP basis and a $73 million to $75 million on a non-GAAP basis. We estimate GAAP net loss for share in the range of $0.13 to $0.14 and non-GAAP net income per share in the range of $0.10 to $0.11. We expect EBITDA to be in the range of $13.5 to $14.5 million.

For the full fiscal year 2008, we reaffirm our revenue guidance from last quarter, but the revenue to be in the range of $295 million to $300 million. On a non-GAAP basis we expect revenue to be higher than previously estimated and in the range of $308 million to $313 million. We anticipated our GAAP net loss to be in a range of $0.44 to $0.49 per diluted share and EBITDA in the range of $59 million to $63 million.

With additional upside in non-GAAP EPS we experienced in the first quarter we are raising our guidance for the non-GAAP net income of the fiscal year 2008 to $0.41 to $0.46 per diluted share.

We expect operating margins in the second quarter to stay consistent with the first quarter of 10% and we continued to make investment in sales, marketing and R&D. although the Q2 target is consistent with the first quarter, for the fourth quarter we are raising our operating margin target from a 11% that we communicated in Q1 to 12%.

Even while investing for growth the leverage and economies of scale in our model allows us to deliver a 100 basis points more in operating margin in the fourth quarter than we originally expected.

In conclusion we have high expectations for ourselves on-stream and we are executing towards meeting those expectations with focus and discipline

I’d like to thank all our Omniture employees old and new for their path to continued commitment to our customers and to the company’s vision.

With that I'd like to open the call up for questions. Operator?

Question-and-Answer Session

Operator

(Operator Instructions) and our first question from the line of Brent Thill from Citi, you may proceed sir.

Brent Thill – Citi.

Thanks John can you just walk through the upside you are trying to see now both Site Catalyst I think in ’07 was roughly 78% your revenue key just walk through what you have seen in the quarter and kind of how do you think about for '08 as a percent of revenue?

Josh James

Yeah. Sure, Brent. And before I do that, I want to correct one thing that I stated earlier. Of the QBSRs that were new for the quarter, actually 20 of them came from Visual Sciences and the incremental 4 were new hires. So I want to make sure that's dealt first.

In terms of the revenue, I do not think that we have talked about what percentage SiteCatalyst result is. We talked about in terms of bookings that we saw a meaningful portion of our bookings come from the up-selling and cross-selling. That trend is continuing. We continue to see customers pulling the sales people in that direction where they are saying, look, we have been using the products, we are ready for more, and we are ready to really leverage the data that's sitting there. We want to figure how to optimize and personalize the experience for our customers. And the only way to do that is leveraging the data that we already have.

And sometimes, you are doing that through our Genesis partners and sometimes you are doing that with the products that we offer them like our testing and target products and like our SearchCenter products. So, we continue to see a lot of progress there, and it just kind of shows the appetite, despite what is happening in the macroeconomic environment, the appetite for companies to really go and leverage this channel because its one of the most efficient channels that they have.

Brent Thill – Citi.

I have a quick follow-up question. I think Chris had mentioned in a balance that he made a couple of tweaks to the sales force and the overlay team. Can you just give us a sense of how that transition has gone?

Josh James

Yeah. Sure. There are always some things that we can improve. But overall, it seems to be going pretty well. We tried the other way where we had everyone kind of carrying everything in their bag. The challenge was we did not have experts that we could call on. We had folks that were some of more experts in something, some of more experts in others. And as we have been acquiring these companies, we have been getting their sales teams that are truly expert in their field. These are new field. So it is not broadly understood by the marketplace or by the rest of the sales team or the rest of our organization.

So, it just really felt like it was important to bring in these experts because this is a consultative sale, and in that kind of situation they really want us to educate them and help them understand best practices and they do not want that to start only once the consultants come in. They want that to start when these really high end sales people come and visit with them. So, that has been fairly effective thus far and I think we are going to see a lot of success there on that front.

We have talked about for a long time the fact that we really invested pretty heavily into our management infrastructure, on the sales side, and that is helping kind of grease the skids and made sure that we do not have the things that are conflicting, any policies or procedures that are conflicting within the sales team or within the account management team. So there are things we continue to improve on, but we are still seeing a lot of success there.

Brent Thill – Citi.

Thanks.

Josh James

You bet. Thanks, Brent.

Operator

Your next question comes from the line of Michael Huang from ThinkPanmure. You may proceed, sir.

Michael Huang - ThinkPanmure

Thanks very much. Hi, guys. I have a couple of questions for you. The first; so with respect the earlier customer migration to SiteCatalyst, I think you had mentioned 16% uplift in annual pricing due to some of the cross-selling at the time of migration. I was wondering is it a good estimate to assume for customers that have yet to migrate, and is this type of uplift baked into your guidance assumptions for the year, could this represent upside?

Mike Herring

Yeah. So we are pretty early into it, so there is a relative early data point. But that is pretty consistent with the way when we see new customers coming to Omniture, is that kind of uptake. And so, we are just happy to see that same thing happening in the HBX migration customers. It is not something that we have built into our guidance. But to be totally fair, it issomething that would take a while to kick in. The deals have to close, they have to migrate, and then that initiation of that piece of revenue in terms of a recognition standpoint. So, in terms of upside to this year, it probably will not be very meaningful but it is a good trend in terms of how could it help 2009, et cetera?

Josh James

On field efficiency and leverage off of that base, we acquired that base hoping that we'll build a ceiling to it and build that into the model when we are justifying the transaction. But it isreally interesting to see as we have gone around to these various customer summits and had does these conversations. And these customers comment and they are pretty blunt and straightforward with you. Number one, we weren't expecting this news and we have got to go in and [gather] some resources to bill the dues effectively. But we are extremely excited about it, now that we have seen these additional products and functionality that you guys have; we really want to take advantage of that.

And that's been one of the big reasons why it is just kind of been of de facto choice. But, yeah, absolutely, we are going to move over, not because we think that HBX is failing, but more because we want to leverage normally the functionality in SiteCatalyst, but really want to get an opportunity to leverage within Genesis and to leverage the testing and targets products and the SearchCenter products. So, that's kind of what we are seeing as the real high level interest from our customers that are currently on HBX.

Michael Huang - ThinkPanmure

Great. And another question for you, so in terms of the summit in Utah, clearly the successful from an attendance and energy standpoint, I was wondering if you could comment on how that might have impacted sales cycles, cross-selling activity in close rates in Q1 or is this more of an impact in Q2?

Josh James

Yeah, definitely. Every year it is had an impact and its improved things. If not so much in Q1 -- you typically do not someone necessarily come in, and then sign the next day that wasn't already planning on singing. That does happen, but that is not a broad trend. More what you see is folks that are kind of at the beginning of our sales process. They come to our summit and they see the energy and excitement that's there and they see all the other customers that are providing testimonials. They all have things that they want us to improve on.

But as you saw when you were there, generally speaking, everyone is extremely positive. And so, it just really helps solidify the decision and kind of commentary they threw out there in the marketplace that we are the company that they should work with. That just makes them that much more comfortable, so they move forward with that decision and be really confident internally with their own teams when they are making choice and being the proponent for Omniture Systems.

Michael Huang - ThinkPanmure

Thank you very much.

Josh James

You bet, Michael.

Operator

And the next question comes from the line of Tom Ernst Deutsche Bank. You may proceed.

Tom Ernst - Deutsche Bank

Good afternoon. Thanks for taking my question.

Josh James

Hi Tom

Tom Ernst - Deutsche Bank

I would like to ask you the same questions I asked right after the deal closing, now we have got another quarter of data behind us. How is your ability to retain the HitBox customers? For example, if I were a competitor of yours, I would be going after these customers now while they are being told about migration, et cetera. Have you lost customers to the competition? And then, also, what are you seeing in the migration? How time intensive is that proving to be for your professional services organizations and/or are any of them becoming painful migration?

Josh James

So, from a migration standpoint, we have transitioned a lot of customers from a lot of different solutions and a lot of customers from HBX over the years. So, we had pretty good understanding of what was going to be involved there, and especially when now customers are frankly learning to be a little more patient with us than they may have been historically when you had the two companies that were in there really battling it out.

In terms of competitivness, yes, it is been really interesting to see the response from the HBX customers. We mentioned in the call that there hasn't been any really material losses, to the contrary, then a lot of excitement. One of the things that we learned from the other acquisitions that we have done in the space with acquiring new companies is you do not walk in and say we are sun setting anything. We have never done that anyway, but we have not been as strong verdict in this upfront about the fact that we are going to support this as long as you need us to support it and that is what we are saying this time and it really makes all the difference so, yeah, of course, the competitors were in there but one of the other comments I made is, these customers of our really do consider us as partners and the fact that they felt like they need to switch to some point out to HBX and the fact that they want to go out and take advantage of the right tool, only highlights the fact that they really need to pay attention to who they are choosing for their long-term partner and we can certainly make an extremely strong argument there especially relative to anything else that's out there that is available.

So we have not seen anything other than really positive trends on that front and like Mike was mentioning, we have also seen not only strong trends from a migration standpoint but also an appetite for additional product and services when they are making that transition. So we have been very encouraged but we are still only one quarter into it and have a long way to go but I think we have seen it the update and it makes us feel pretty good about the overall opportunity here.

Tom Ernst - Deutsche Bank

And what about the, what are you are finding is the outcome in terms of the complexity and time involved here, professional service organization to support the migration?

Josh James

So we have got a team that's dedicated just to the migrations and the team that we set up to begin with was the right amount of people and the right amount of folks to be concentrated on, helping these people migrate over. It is kind of like any professional service organization. We look for commitment from them and then we slot them in and typically they have quite a bit of notice they can give to us, because they are requiring technical resources on their side.

So, the things that they want to focus more on, Tom is just that to be on the right plan and place, what are our alternatives, what's the simple solutions, what's the more complex solution and what are the benefits of each so that we can go back internally and make a case and say we want to do the real quick one, that just kind of get us up and running and doesn't really require very many resources on our side. Or they say to us, you know what we understand the benefits that we get out of the full borne installation and we want to leverage all the functionality that exists in SiteCatalyst.

And that's really played into our favor because we do have far and way the most flexible solutions out there, that has the most advanced functionality out there. That has most enterprise class functionality out there, and typically if you have been using something else like any of our competitor’s products or you have been using HBX, some of the lack of functionality that may exist in those other products becomes very clear and they have needs and desires for additional functionality. When they find up that we have those things, it really speaks to them. So, it is just put us in really good situation from that standpoint, but we are not really have any -- there is not really any issues of that kind we are driving towards on that migration standpoint, from a time and resources standpoint. Its pretty much what we predicted and what we thought it was going to be just based on the other transactions that we already been through.

Tom Ernst - Deutsche Bank

Thank you, again.

Josh James

You are welcome.

Operator

And the next question comes from the line of Brian Fitzgerald from Banc of America Securities. You may proceed.

Brian Fitzgerald - Banc of America Securities

Thanks. You guys mentioned that you have not seen any overall macro weakness on a more granular basis. Have you seen any signs in the mid markets segments and I guess particularly how do you feel about this segment in a tough macro environment given that there is availability of other free products out there?

Josh James

That's a good question. I was actually just going to talk with the sales team just a few days ago and I talked to our enterprise sales exes quite often and make visits to customers with them and was down, had a chance talk with the mid-market executives and their seeing -- their answer has been exactly the same. I ask them, what you guys seeing, you see any hesitancy out there, or you seeing any caution from your customers, any different behavior? You know, the answer was anecdotally no from all these sales executives that we talked to.

So, we are still not seeing anything in terms of customer behavior changing. As we mentioned we are certainly, really cautious and conscious about the investments that we are making and trying to really stay on top of things in case it does shift. But from a alternatives perspective in the MidMarket, these folks, they either, get the fact that their data is going to be used by someone else for someone else's benefit, or they are going to be or they are going to use SiteCatalyst and it is their data and it is for their benefit and they are going to pay for that. They are going to pay for either way. It just determines what kind of relationship is there, it just depends on what kind of relationships that they want.

So, has not really been an issue. We have not been seeing any change of behavior from the time that the first free analytics product was offered until now. It has been exactly the same except for the sense that there is a still lot more awareness out there about the alternatives, and there those free products give service that is pretty good, lead generation and awareness for our products and services.

And the only other comment I will make on that is when you look at how complex the spaces is going to be over time, it is not just about collecting data and generating report in a dash board. That's like step one out of ten steps. You want to make that data available, you want to have a learning system, you want to be able to then leverage that data and build it into additional systems and you key word ‘buying’ on search engines across the variety of search engines. You want to do better advertising. And if your marketing and you want to integrate all that data with you landing pages and have real time optimization and behaviorally targeted pages and content. You cannot do al those things without having a system like ours. So, they are having an equal system, like ours. The customers who can think forward more than six months, are the ones that end up using SiteCatalyst.

Brian Fitzgerald - Banc of America Securities

Great, thanks.

Operator

And the next question comes from the Imran Khan from JP Morgan. You may proceed, sir.

Imran Khan - JP Morgan

Yes, hi, it is Imran Khan, guys two questions and thanks for taking my question. First, Josh, could you talk a little bit about in terms of the pricing environment, are you seeing aggressive discounting from your competitors or are you seeing any push back from customers in terms yearly price increases?

And second question is in terms of international what kind of activities you are seeing in the international market more may be little deeper, the 250 plus customers you added, how many of those customers came from international markets? Thank you.

Josh James

Sure Imran we knew the your Imran.khan is how your we refer to your over here but wanted to in terms of the activities that we are seeing and just see if I can remember all the questions, one of the most what we see international versus domestically. We are actually pretty encouraged. I kind of been hesitate a little bit on what the international percentage of revenue was going to look like, based on the fact that the company that we are acquiring had low revenue outside the States than they had in the states relative to our company. But even with that lower percentage of revenue outside the States from Visual Sciences the acquired company -- Once the company was acquired and we merged here [to advance those] we were still able to increase our percentage of revenue from outside the US to up to 27% from 26%.

So we are encouraged by that and we continue investment very aggressively overseas. We are making from a mix perspective related to the revenue we are making more substantial investment overseas then we are, compared domestically and continue to see there is tremendous amount of opportunity there. And the nice thing is we are now in some places and in some countries and in some regions where it’s going to extremely difficult for a competitor to come in, when they just do not exist in some of these places. And we are sitting there for 100 customers in a particular region and they all know each other and the closest competitor have got two or three.

So that’s been something that’s been really effective and going to drive our business, and continue to see a lot of opportunity internationally.

In terms of pricing we have seen probably the same kind of activity that we have seen before. And it seems like it is just as in vain as it was before. The customers aren't really out. The value that they can get out of having the right system in place and the right platform in place, it is like going and buying ERP system. Of course, price is important. We have got to find the right systems for your company because of so much value you are going to get out of it.

Price is the factor but it is one on five or six factors. And we do not win on price, but the other four or five factors we do win on. And our track record, I think, speaks tremendous volume of the type of customers that we are able to retain and keep speaks tremendous volumes, and the types of customers that continue to shift over our platform from our competitor's platform, every single quarter we are happy to advertise and talk about. Probably serve is the biggest reminder that their customers need to be really careful in considering all the different factors when trying to pick the right online business optimization partner for them.

Imran Khan - JP Morgan

Great. Thanks, Josh and Mike.

Josh James

Thank you.

Operator

The next question comes from the line of Keith Weiss from Morgan Stanley. You may proceed.

Keith Weiss - Morgan Stanley

Thank you, guys. I wanted to ask you on the migrations from HPX to SiteCatalyst. How many of those customers are you seeing are actually opening up new accounts? Can you give us any kind of feel for the 12 percentage, what percentage if ever that your sales people have to get involved in our process again as that migration takes place?

Josh James

Sure. Our sales people get involved in every single migration. They need to be there peripherally. There are opportunities to up-sell and cross-sell. We kind of have them there as precaution depending on what the activity of the customer is going to be. For the most part, customers know that they want a transition over to us. They have had an opportunity to slow dance with us and get a real feel for the type of organization that we run. They like the fact that we have been retaining the folks that they already relationships with, folks that they already trust. And they certainly really value the ecosystem that we have in place with Genesis and the additional products and functionality that we have built.

They have a belief that we are going to build and continue to grow and mature with them, and that we understand what's going on out there in the marketplace. So, you combine all those factors and there are some that go to RFP, and that certainly is something that we take very seriously. But we take every one of these customers very seriously and we just need to make sure that we have the opportunity and the audience to communicate what it is that we do. And if we select as long as we have an opportunity to do that, we are going to be really in a good situation.

Keith Weiss - Morgan Stanley

Got it. And would you be able to characterize it like less than 10% go to RFP or less than 25% go to the RFP?

Josh James

Yeah. I do not have a specific data for you, but it would certainly be less than 25% and maybe less than 10%. I just do not have the specific data for you. We have alluded to the fact that we have done three web analytics acquisitions before and really had a pretty good idea of what we were going to be dealing with when we got into the situation. So, our sales people kind of knew this was coming, our account managers and account management group knew what's coming and our management team knew what's coming. So, we feel like it is a ballot we expected other than we are seeing some of the synergies more quickly than we thought, and we are really encouraged by the cross-selling success that we are having with those customers.

Keith Weiss - Morgan Stanley

Great. And then on the customer account numbers, just to make sure I'm looking at it the right way. I believe you guys were talking about 4,400 customers post the integration of Omniture and Visual Sciences. You added over 250 customers in the quarter and now we are talking about 4,500 customers. So, it seems to be pretty widespread between the total added customers of over 250 and sort of the net add around 100. A, am I looking at this the right way; and B, how does that variance like, just for simple terms just follow 150, how does that work through a customer retention rate calculation?

Mike Herring

Yeah. So that 95% of retention rate includes Visual Sciences business post acquired unit. And to be clear, there are definitely some definitional things around customers in the acquisition of Visual Sciences and we have let some of those customers go on purpose. So there is a net amount that transitions out of it. I can walk you through the math more directly, but essentially we look at our annual basis and beginning plus net adds and divide the number of terminations into that number and it is still at 95% level in Q1.

Keith Weiss - Morgan Stanley

All right. Can you give us an idea what the starting point is? So if some of them are more like [at first], some of that 4,400 were not like real customers, what was the starting point, at least, for the retention figure?

Mike Herring

We have been using approximately 1,400 at the date that we closed it, and we have not got much more grading around that just because it would give a lot of information to the kind of customer base that we acquired in Visual Sciences that is competitively sensitive.

Keith Weiss - Morgan Stanley

Got it. And then, if I could just sneak in one more on your hiring plans, how long were you guys able to hire to plan in the current quarter? And I was wondering if you could give us some kind of color about what you guys are expecting to hire going out through the year, both on the sales side of the QBRs as well as the overall headcount?

Mike Herring

We continue to hire pretty aggressively. We always are hiring sales people, so we will take any references. You want to pass our direction, Keith. But, besides that we have over 100 positions kind of constantly that we are looking for. We did at the acquisition in that and we did fill some of those with Visual Sciences people. So, in terms of the net add quarter-over-quarter, it is kind of an interesting quarter for us because we did rationalize some of the people that came over in the Visual Sciences acquisition. And then, also there was a reasonable percentage that took open positions that we had at Omniture at the close. At the end of the quarter finishing with 985 people is right on target. We wanted to finish with right around 1,000 people. It is always influx as we hire people.

I think that's going to continue. Revenue continues to trend upward. Obviously, we have guided the revenue to continue to trend upward to hit the numbers that we have given you. And within the parameters of hitting operating margin, we are going to hire as aggressively as we can. That is our lever for investing in the future whether it is R&D or sales and marketing and look to do that. So I think you'll see us continue to add probably pretty similarly at the rate, kind of number of employee rate that we are doing prior to Visual Sciences acquisition.

Keith Weiss - Morgan Stanley

Excellent. Thank you very much, guys.

Mike Herring

Great.

Operator

And the next question comes from the line of Brad Whitt from Broadpoint Capital. You may proceed.

Brad Whitt - Broadpoint Capital

Yes. Thanks guys for taking my questions. Mike, can you just tell us what was the share account number you used for the non-GAAP? I can't find it in the press release.

Mike Herring

It should be in the supplemental schedules.

Brad Whitt - Broadpoint Capital

I haven't seen that, is that on your web? I haven't seen on the website yet.

Mike Herring

It should be under omtr.com but I can, for the quarter, we had fully diluted at 74.2 million shares outstanding for the first quarter.

Brad Whitt - Broadpoint Capital

Okay and I had a couple of balance sheet questions, how much of the deferred revenue increase is attributable to Visual Sciences?

Mike Herring

Well you can tell, the portion that’s related to Omniture is a portion that shows up in the cash flow statement, the Visual Sciences fees would have been through the acquisition [phase], acquisition accounting. So the deferred revenue increase was about $13.2 million. It is in the cash flow statement. That would have been related to the Omniture business.

Brad Whitt - Broadpoint Capital

Okay and…

Mike Herring

May be, and say, also to some sales related Visual Sciences post-acquisition, but that would have been relatively small since we are focusing on transitioning in that group as well not selling HBX for example.

Brad Whitt - Broadpoint Capital

And just thinking of that balance sheet too there, I notice that it looks like a pretty big jump in accounts payable, accrued expenses and other long-term liabilities. Can you just comment on some of that?

Mike Herring

Sure. So I mean in general, there is a lot that's kind of going through the system in Q1 related to the acquisitions and not just the liabilities that the acquisition generates with advisors and such, but also with the businesses that we acquire. They were about maybe half of our size. So we took on a pretty large piece of operations there and overall the activity increased quite a bit. We also had ARAP in particular that was low and normally low in Q4 from the timing of payment standpoint.

Brad Whitt - Broadpoint Capital

Okay. But most of that is something that’s going to come out in the cash in the next couple of quarters?

Mike Herring

I do not think it will. AP is going to stay relatively high compared to historical level because we are still running a bigger business now, a much high level OpEx well in through the income statement.

Brad Whitt - Broadpoint Capital

That is about three times bigger than we were.

Mike Herring

Yeah, so I mean it is probably something like two times bigger or two and half times better bigger than on a run rate basis, yeah.

Brad Whitt - Broadpoint Capital

Okay.

Mike Herring

Once you take out the acquisition related liability that is yet to be paid out

Brad Whitt - Broadpoint Capital

Okay, and I didn’t quite follow me you on the CapEx, I think you had $10 million in this quarter?

Mike Herring

Yeah.

Brad Whitt - Broadpoint Capital

Well, it looks like you had $12 million of last year, so would do you expect that $2 million to go next several quarters?

Mike Herring

Last year we had more like $22 million probably total. Last year it was --- and that's because there was a piece of it that was actually put on lease. So, on apples-to-apples basis $12 million doesn't mean anything - it is more like a $22 million to $23 million comparative number. And in Q1 we were not using leases and went back to using financing or financing out of working capital. That mix depends on financing rates mostly. And last year, I do not know if you remember but we had relatively low CapEx period, particularly in the first half as we are moving through a pretty dramatic improvement in efficiency of our software that allowed us to kind have lower than expected CapEx in the first half of the year. So this year we are probably targeting around $45 million in CapEx for the year, something like that, all in and coming of off the year where we had $22 million, $23 million in the year before and that was artificially though because of some improvement we made in the system.

Brad Whitt - Broadpoint Capital

Okay, that’s very helpful. May be Josh one further question if you look at the net new customers this quarter 250, obviously, you are getting more opportunities within your existing base for up sales and cross sales, that's going to drive probably more significant portions of bookings. How are we to expect a net new customer trend to look at over the couple of quarters?

Josh James

We want to see how that plays out and I have a specific guidance for you on that. We have kind of created a flexible sales, I guess incentive system where they certainly are rewarded for new customers. But at the same time they are going to go where the dollars are and if these customers are going to be happier by us allowing them to buy additional products then the sales people are going to go there. So if there is a little bit of conflict there internally for us because on the one hand, we want to go out and continue to build that footprint. On the other hand, we want to make sure that we have really happy satisfied customers and the reason that we have built products that we have and we have acquired the company's that we have, is because those current installed customers are telling us. You need to go and buy this. You need to go and build this. You need to go and partner with these people. And that's really driving this strategy on that front.

But a side effect to that is that once these customers get additional products installed, the likelihood that they move to something else really diminishes quite a bit. And that's something that important to us to continue to try to really create a very intricate relationship. So that we have got great long-term customer and one that's really using our solution not just to get reports but really to run their business.

Brad Whitt - Broadpoint Capital

Okay. Thanks a lot for taking my questions.

Josh James

My pleasure.

Operator

And the next question comes from the line of Steve Ashley from Robert W. Baird. You may proceed sir.

Steve Ashley - Robert W. Baird

Thank you. I would just like to talk about the partner of eco system. Do you have any sense of how much your business might be being influenced by your partners and also I know at your analyst day you talked about the fact they come in different flavors, there is application partners and platform partners and etcetera and which of those kind of different groups might be having more of an impact on your business? Thanks.

Josh James

Yes. We have not ever given any exact number and for competitive reasons and we are going still keep that under wraps. It is meaningful, it is substantial and material for our business and it is something that we feel pretty good about because it is a defensible portion of our business. We have to go out and built these relationships and built credibility overtime and in order to built that credibility overtime, you have to sure of the needs of each other and you have to see that when you are in a sales situation together, you are really going to help to each other out.

And one of those things that we have seen quite a bit actually is customers, our partners will come to us and say, look we just got an RFP from one of your customers and they said in order to win the business, we have to make sure that we are an accredited partner of Genesis and they are going to call you guys just do due diligence on our relationship. And so we certainly love seeing that and we seen that Genesis is a big part of our business. We do get a lot of leads from our partners and lot of business from partners but more importantly, almost all of our sales have the word Genesis comes up and the promises with Genesis is something that encourages these partners to feel like they can grow in scale with our business. So it is extremely important to our business.

Steve Ashley - Robert W. Baird

Can you able to tell us how many Genesis customers you have at this point?

Josh James

No we haven't broken that out yet, but we have, you have to really know about all the different types of partners that we have, there were over 130 accredited Genesis partners and we have over 400-500 different partners that interact with us, whether its on the application side, technology integration side, or purely on a marketing or consulting or an implementation side. So we are really excited we got a great ecosystem that's helping to build our business.

Steve Ashley - Robert W. Baird

Thank you

Josh James

Great thank you

Operator

And the next question comes from the line of David Hilal from FBR. You may proceed.

Mike Herring

David?

David Hilal - FBR.

Hi guys, my question is on cash, it looks like cash went from 135 to 86 and I am just trying to run the math. I think Visual Science, this was net 38 down, but I guess Mike, can you just walk me through the math to account for that cash decline please?

Mike Herring

Sure. The actual cash used in Visual Science's deal was I believe $52 million. I do not have that right in front of me. And then there are definitely some payments we made related to the acquisitions around advisors and also related to net ratings. I think if you go to some of our filings and details that are pretty much in debt. So, we actually generated cash pretty well from operations, its kind of resale from that point to get to where we are now. That said, I just pointed out earlier, we do have a higher AP balance et cetera now, than we did before, and as it all plays out. But because the company is generating good cash, and I think we will see that balance grow pretty nicely overtime.

David Hilal - FBR.

Okay. And then let me ask you about on the HPX conversions. I know you are not forcing those guys to go to SiteCatalyst, if you could ballpark the percent that either have already or started to move and that maybe what a realistic expectation for year end would be that would be great?

Josh James

So, these things that we have talked about and obviously there is a lot of sensitivity around all of this from a competitive standpoint, but we have been in contact with every single one of these customers. They know what we are all about and we have an idea of what each of them are thinking and what each other of their timing may or may not be. As far as setting expectations, we do not want to set expectations, because we just do not want to on the wrong, we do not be incorrect. So, we are just going to continue to work with them and try to make sure that feel like they have got an opportunity to come when it is appropriate for them. Then we start getting some real good clarity on that then we'll probably start talking about that a little bit more.

As an example, the Instadia customers, that we acquired little over a year ago now, we are now to the point where are we have gotten commitments from over 90% of the revenues associated with that. But many of them are still transitioning, but there are signed contracts of more than 90%, So that’s when we start getting to those kind of numbers then that’s when we start talking about it, because and we feel like the base is secure. The folks that aren’t coming, some of them there are customers that didn’t felt like it was right for us to work them any more or they didn’t think it was right for them to work with us, we are going to lose some. But to build and to retain 90% normally of that revenue is pretty significant. But it did take us about a year before we secured all those contracts.

So I do not know how that is going to be different year, because lot of their businesses was domestic, if its going to be better, if its going to be worse, and it can be a little slower or a little faster, we just do not have enough data on that yet, just to say that we are in contact with all of them and have received a positive feedback thus far and feel pretty encouraged by it.

David Hilal - FBR.

Okay. And then, my final question is on the $21 million of rev from the two acquisitions I guess, a, could you split out between Visual Sciences and Offermatica, and then b, how much that might have been for perpetual license revenue? Thanks.

Mike Herring

A very small percentage of it is perpetual, as upon closing the deal we stop signing the additional deals and are working through this, the last few pieces that they had and it wasn’t significant. But the $21 million was my sort of gift to you guys to be able to back in what organic revenue growth was. I do not want to break it out more than that, its wise to say we thought, as we talked about last quarter on the Visual Sciences run rate will drop some as we eliminate perpetual license from that. And to get down to sort of their core revenue base and then start transitioning that revenue base. And then Offermatica was there top of that to get to where we were, to get that $21 million.

David Hilal - FBR.

Okay. Thank you.

Michael Look

All right. We have time for one more question please.

Operator

And our last question comes from Dan Salmon with BMO Capital. You may proceed.

Dan Salmon - BMO Capital

Thanks for taking the call guys. Could you expand a little bit on your relationship with the agency community, I know you have often times tapped local agencies to expand in the new markets. I would like to hear a little more about that and perhaps also domestically as well. That’s all thanks.

Mike Herring

Just how we are leveraging agencies to continue to expand our business?

Dan Salmon - BMO Capital

Yes exactly.

Mike Herring

It just depends on the market that we are in kind of to your point. Yes, it is definitely is different overseas than it is hear in the States. And then when you look overseas it is different in Europe than it is in parts of Asia. And it depends on what part you are talking about. So, we really take it based on the way that market works and that ranges anywhere from some agencies that are basically out there, reselling our products, and do the installations, and implementations. And then some agencies that essentially just bring us in that will take a cut of anything and they want us just to be a third party, they are recommending, and they do not want to have any conflict of interest and they just really serve up leads for us and close business for us. The whole gambit in between, whether its implementation agencies or staff that wants to consult on our product. They are going in and will sell our product and they want go in and help them with the folks that are on the ground, help them leverage the data and setup the reports, so it is just a wide variety.

Dan Salmon - BMO Capital

Okay. Thank you.

Mike Herring

All right. Thank you very much. I appreciate everyone’s time and we will be available for follow-up calls if anyone needs us, thank you.

Operator

Thank you ladies and gentleman this concludes the presentation for today you may now disconnect.

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Source: Omniture Inc. Q1 2008 Earnings Call Transcript
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