CXApp Inc (CXAI) saw its shares soar on Tuesday after the company revealed its second-quarter results and a significant strategic partnership with Alphabet Inc’s (GOOG) Google Cloud.
While CXApp’s Q2 revenue of $1.766 million fell short of the anticipated $1.8 million, the company’s earnings report highlighted positive trends. The company’s subscription to one-time revenue split improved to 85% in the quarter, up from 79% in the previous year. Gross margin also increased to 80% from 75% in the prior year, and the net retention rate was a robust 105%. CXApp reported a 78% year-over-year increase in renewal and expansion bookings, demonstrating strong customer engagement.
Khurram Sheikh, chairman and CEO of CXApp, expressed optimism about the company’s progress. He stated, “We continue to make great progress in shaping the future of work with our largest expansion deal this quarter. This large enterprise client is seeing high adoption of our platform in their pilot deployments at their headquarters in the U.S. and a second major site. We are solving real problems in the work environment for them, and they are now planning to scale up with our AI-native solutions across their enterprise footprint.”
The key catalyst for the surge in CXApp’s stock price was the announcement of a multi-year, multi-million dollar strategic agreement with Google Cloud. This partnership will involve Google Cloud providing advanced AI infrastructure, security, and application products to enhance CXApp’s platform. Moreover, Google Cloud will co-invest with CXApp in the continuous deployment, monitoring, and modernization of the CXAI platform.
Sheikh highlighted the strategic importance of this partnership, stating, “Given the momentum we see in the market with our customers and enhanced upcoming offerings including our AI-based Analytics platform CXAI VU, the Google Cloud agreement positions us to deliver our commitments to our customers. We are super-excited about this partnership as it provides us access to all the latest Google AI innovations that we plan on adapting to revolutionize the workplace market with amazing employee experiences.”
As a result of these positive developments, CXApp shares surged by 68.7% to reach $2.48 at the time of writing.
