Good afternoon. My name is Kelly, and I will be your conference operator today. At this time, I’d like to welcome everyone to the Ooma, Inc. Fourth Quarter and Fiscal Year 2019 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. After the prepared remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. Please go ahead.

Thanks, Kelly. Good day, everyone, and welcome to the fourth quarter and fiscal year 2019 earnings call of Ooma, Inc. My name is Matt Robison, Ooma’s Director of IR and Corporate Development. With me here today are Ooma’s CEO, Eric Stang; and CFO, Ravi Narula. After the market closed today, Ooma issued a press release via GlobeNewswire. The release is also available on the company’s website, ooma.com. This call is being webcast live and is accessible from a link on the Events page of the Investor Relations section of our website. This link will be active for replay of this call for at least one year. During today’s presentation, our executives will make forward-looking statements within the meaning of the federal securities laws. Forward-looking statements generally relate to future events or future financial or operating performance. Our expectations and beliefs regarding these matters may not materialize, and actual results and financial periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected. These risks include those set forth in the press release we issued earlier today as well as those more fully described in our filings with the Securities and Exchange Commission. The forward-looking statements in this presentation are based on information available to us as of the date hereof, and we disclaim any obligation to update any forward-looking statements except as required by law. Please note that other than revenue, or as otherwise stated, the financial measures to be disclosed on this call will be on a non-GAAP basis. The non-GAAP financial measures are not intended to be considered in isolation or as substitutes for results prepared in accordance with GAAP. A discussion of why we present non-GAAP financial measures and a reconciliation of the non-GAAP financial measures discussed in this call to the most directly comparable GAAP financial measures are included in our earnings press release that is available on our website. On this call, we’ll give guidance for first quarter and full year fiscal 2020 on a non-GAAP basis. Also, in addition to our press release and 8-K filing, the Events & Presentations page in the Investors section as well as the Quarterly Results page of the Financial Information section of our website includes links to costs and expenses not included in our non-GAAP values and key metrics of our core subscription business. These are titled Supplemental Financial Disclosure 1 and Supplemental Financial Disclosure 2. Additionally, our investor presentation slides include GAAP to non-GAAP reconciliation that also provides resolution of GAAP expenses that are excluded from non-GAAP metrics. Before I hand it over to Eric, let me say we’re pleased to be presenting at the 31st Annual ROTH Conference scheduled for March 19 in Orange County, California. Okay, Eric.

Thanks, Matt. Hi, everyone. Welcome to Ooma’s Q4 earnings call. FY 2019 which just ended on January 31 was an outstanding year for Ooma, as we once again achieved significant growth, controlled our bottom line and invested in the business for the future. We believe we enter FY 2020 with strong competitive advantage in segments we target and solid momentum. I’d like to highlight today some of our important FY 2019 accomplishments and then review our plans for FY 2020. A year ago at the start of FY 2019, you’ll recall we were investing heavily in the core feature set for Ooma Office. We were not yet addressing the Enterprise business segment and we had just acquired a small company to develop and launch a smart camera to anchor our plans for Home Security. Today, I’m pleased to say we are winning larger customers for Ooma Office than ever before and our office core feature set is significantly enhanced. Ooma Enterprise is integrated into our overall business marketing and sales programs and on a growth trajectory. And we have announced the imminent launch of Ooma Smart Cam with features and pricing we believe are superior to competition. We’re extremely pleased with our FY 2019 progress and more importantly feel we have established the competitive advantage and momentum to fuel continued success. In Q4 of FY 2019, we achieved $34.7 million in revenue, exceeding our previously issued guidance. Overall for FY 2019, we achieved $129.2 million in revenue, representing 15% year-over-year growth and a non-GAAP net loss of $3 million. We also invested significantly in FY 2019 to build for the future, spending 23% of revenues on R&D. And in our primary area of focus, which is to grow our subscription services revenues from business customers, our understanding is we again led the industry with a year-over-year growth rate of 50% in both Q4 and for all of FY 2019. We’re proud of these accomplishments and excited as we enter FY 2020. For FY 2020 our strategy remains unchanged and is to be the undisputed leader in each of the segments we target by capitalizing on our unique end-to-end platform. Simply put, we strive to provide customers better features, quality and value than others. Our primary focus for FY 2020 is to continue to execute to drive the growth of our business. To this end, we intend to enable increased investment in sales and marketing as a percent of sales by controlling the growth of our investment in R&D by growing our gross profit margin over time, primarily through increasing the proportion of business customers in our total revenue, and by introducing additional high margin services in line with our long-term strategy to leverage our unique platform, increase our revenue per customer. We also have important new developments planned for FY 2020 to strengthen our competitive advantage in each of our target segments. Starting with the small business segment, which we serve with Ooma Office, we have some final key features we want to roll out early in FY 2020, at which point we will have in our view a complete curated feature set that affords the ultimate in simplicity, reliability and value. Once in place, our development focus will largely shift to new services we can enable through the Office platform and for which we can charge extra. Our new partnership with Sprint is part of this vision. This is a fundamental partnership which has already resulted in our announcement of a 4G adapter for use with our Telo residential product. With Sprint’s strong commitment to 5G, we envisioned our Sprint partnership playing a greater role across all parts of our business over time. Moving next to the larger business segment, where we provide a full UCaaS solution called Ooma Enterprise, we plan in FY 2020 to continue our strategy of developing and customizing our solution to meet the special needs of our customers. As part of this, we anticipate focusing on selected vertical segments and further improving our solution for white label use and customization by channel partners. Having made major strides to round out our feature set and support our channel partners in FY 2019, we now enter FY 2020 ready to expand sales and marketing and drive more customer engagement. Thirdly, on the residential front, where we provide Ooma Telo for phone service and are expanding into Home Security, we have initiatives underway this year to introduce our 4G adapter for wireless Internet and phone service to launch our new Ooma Smart Cam and to round out the components and features of our smart security offering. The Ooma Smart Cam will be a prime focus for us since we feel it offers an unbeatable combination of features and value. Obtaining broad retail distribution and consumer recognition for Ooma Smart Cam will be an ongoing process for us given we do not intend to invest in heavy product advertising, but we are excited by the large market opportunity, the reception we’re getting from our retailers and most of all by the feedback from our early beta customers. Overall, we believe we have a sound strategy and our focus is on execution. Our key FY 2020 objectives include; one, growing our Ooma Office and Ooma Enterprise customer base in conjunction with increased sales and marketing; two, expanding the range of surfaces we offer and monetize including through the launch of 4G with Sprint; three, launching and driving recognition of Ooma Smart Cam and continuing the development and rollout of smart security; and four, continuing to build Ooma into a recognized, respected and leading brand. We believe we are well placed to execute on these four objectives given our unique platform, customer momentum and focus on leadership and key segments of the market. Now before I turn the call over to Ravi, I have some special news. We just learned that again, for the sixth year in a row, the readers of PC Magazine have voted Ooma Office, the number one small business phone service, beating out all competition. We’re naturally thrilled by this result. Like our number one ranking by consumer reports for residential phone service, winning this award validates that consumers value our solution and we are on the right track for continued success. I will now turn the call over to Ravi to discuss our results and outlook in more detail, and then return with a final comment before we take your questions.

Thank you, Eric, and good afternoon, everyone. I’ll start with a review of our financial results for the fourth quarter and full year fiscal 2019 and then provide our financial outlook for the first quarter and full-year fiscal 2020. All income statement items except revenue are on a non-GAAP basis, and we have excluded expenses such as stock-based compensation, amortization of intangibles and legal expenses related to certain litigations. The reconciliation of GAAP to non-GAAP financial data can be found in the press release issued earlier today, which is available on the Investor Relations section of our website. First, Q4 2019 and full year fiscal 2019 results. We ended the year with strong fourth quarter financial performance, achieving $34.7 million of revenue, which exceeded our previously issued guidance range of $33 million to $33.5 million. On a year-over-year basis, total revenue grew $4.5 million or 15%. This revenue performance was driven by the continued growth of Ooma Business, as well as higher sales of security cameras in the fourth quarter. For full year fiscal 2019, we achieved revenues of $129.2 million, up 13% year-over-year and exceeding our previously issued guidance range of $127.5 million to $128 million. Net loss for the fourth quarter of fiscal 2019 was $669,000 better than the previously issued guidance range of a loss of $800,000 to $1.2 million. Net loss for the year was $3 million compared to a previously issued guidance range of a loss of $3.1 million to $3.5 million. Ooma Business subscription and services revenue during the fourth quarter of fiscal 2019 grew 50% on a year-over-year basis. And revenue contributions from Ooma Business are now 30% of total revenue compared to 23% for the prior year quarter. Overall, we are pleased with the progress we have made in fiscal 2019 on our key strategic initiatives, namely growth of Ooma Business and development of new features and functionalities for our smart security solutions. The combined subscription and services revenue from the core businesses, namely Ooma Business and Ooma Residential grew 16% year-over-year driven by 50% growth of Ooma Business. Our residential subscription and services revenue grew 4% on a year-over-year basis as we have been shifting our sales and marketing activities towards the growth of business. For the fourth quarter of fiscal 2019, subscription and services revenue was 89% of the total revenue compared to 90% in the prior year period. Product revenue for the fourth quarter of fiscal 2019 was $3.8 million, up 25% year-over-year primarily due to higher sales of security cameras in the fourth quarter. With that, I’ll now provide details on some of our key customer metrics. Our total core users increased from 929,000 core users at the end of fiscal 2018 to 976,000 core users at the end of fiscal 2019, driven primarily by growth of Ooma Business. The end of the fourth quarter of fiscal 2019, our business users now account for 16% of total core users compared to 13% at the end of the prior year period. As a result of the mix shift towards the business customers, our blended average subscription and services revenue per month or ARPU increased to $10.17 in the fourth quarter of fiscal 2017 – fiscal 2019 compared to $9.24 in the prior year period. Annualized exit recurring revenue was approximately $119 million, at the end of fourth quarter of fiscal 2019, a 16% year-over-year increase. We achieved 99% net dollar subscription retention rate for the fourth quarter of fiscal 2019 compared to 101% for the fourth quarter of fiscal 2018 driven by growth in ARPU for Ooma Business offset by lower growth of residential business. With that, let me add some color to our gross margins. Product and other gross margin was negative 36% for the fourth quarter, compared to negative 19% for the same period last year. This negative product gross margin was impacted due to tariffs, which were imposed recently as well as due to additional freight charges incurred during the holiday period to fulfill higher than expected product demand. We have since increased our inventory levels, which should help us reduce some freight charges. However, product margins may fluctuate, including due to further changes in tariffs. Subscription and services gross margins of approximately 70% were in line with our expectations as we continue to grow and invest in the business. As a result of higher negative product margins and because – product revenue was a larger portion of our overall revenue, our overall gross margins were 58% for the fourth quarter, down from 61% in the prior year quarter. However, overall gross profit dollars for the fourth quarter of fiscal 2019 increased to $20.1 million compared to $18.6 million for the same period last year, driven by increased subscription and services revenue. Now on to operating expenses. Fourth quarter operating expenses were $21.1 million, an increase of $1.9 million or 10% on a year-over-year basis. Overall, sales and marketing expenses for the fourth quarter of fiscal 2019 increased year-over-year by approximately $800,000 to $10.2 million as we increased marketing programs to support the growth of Ooma Business offset in part by lower residential spending. Research and development expenses were $7.4 million, an increase of approximately $200,000 year-over-year. As we have already completed a number of enhancements to Ooma Business, we expect to see some leverage from R&D starting in fiscal 2020. G&A expenses were $3.6 million compared to $2.7 million for the prior year quarter to support the growth of business. We have excluded certain legal expenses of approximately $100,000 from our non-GAAP results that relates to certain lawsuits, primarily securities and litigation. Given these expenses do not directly correlated to our regular business operations, we believe it is useful to exclude these expenses from non-GAAP results going forward. Our net loss in the fourth quarter of fiscal 2019 was $669,000 or $0.03 loss per share compared to a loss of $508,000 or $0.03 loss per share in the fourth quarter of fiscal 2018. Adjusted EBITDA loss was $455,000 in the fourth quarter of fiscal 2019 versus a loss of $176,000 for the same period last year. Now turning to the balance sheet and other metrics. We had cash and investments of $42.6 million with no debt at the end of the fourth quarter of fiscal 2019, as we invest in the business for growth and due to increasing our inventory position at the end of fiscal 2019. For the fourth quarter of fiscal 2019, cash used in operations was $2.1 million compared to cash generation of approximately $800,000 in the prior year quarter. We ended the quarter with 684 full-time employees and contractors, up from 619 in the prior year quarter. I’ll now provide outlook for our first quarter and full-year fiscal 2020. Once again, our guidance is non-GAAP and has been adjusted for expenses such as stock based compensation, certain litigation charges and amortization of intangibles. The first quarter of fiscal 2020, as there is some seasonality in the first quarter relative to the fourth quarter, total revenue is expected to be in the range of $33.5 million to $34 million. We have assumed $1 million of revenue from Talkatone for the quarter. We expect non-GAAP net loss to be in the range of $900,000 to $1.3 million. Non-GAAP net loss per share is expected to be in the range of $0.04 to $0.06, we have assumed 20.5 million weighted average shares outstanding for Q1. For full year fiscal 2020, revenue is expected to be in the range of $140 million to $143 million. We have assumed $4 million of revenue from Talkatone for the year. We expect non-GAAP net loss to be in the range of $3 million to $5 million as we continue to invest in the sales and marketing channels to grow Ooma business, as well as in R&D for expansion of smart security solutions. We believe these investments should help us with our longer-term growth goals. Non-GAAP net loss per share is expected to be in the range $0.14 to $0.24. We have assumed approximately 21 million weighted average shares outstanding for fiscal 2020. In summary, we are pleased with our fiscal 2019 results, driven by continued growth of Ooma business and believe our efforts in fiscal 2019 positions us well going into this year. With that, I’ll pass it back to Eric for some closing remarks. Eric?

Thanks, Ravi. We’re pleased to finish our FY 2019 year on a high note with growth exiting our guidance and we now look forward to FY 2020 with excitement. Ooma’s increasing its differentiation as we leverage our platform to target segments and pioneer new solutions. We’re also exploiting the full scope of our business to drive customer recognition and optimize growth synergies. In FY 2020, we will start to transition to a greater focus and spend on sales and marketing to bring our solutions to more customers. Our primary focus remains the business market, but we’re also innovating for the residential market and see great potential. Over time, we expect to introduce new services across our business and drive more revenue per customer. Given the large market opportunity before us and our unique solutions, we feel we are still in the early innings of developing Ooma into a large and highly successful enterprise. With that, let me say thank you. We’re now happy to take questions.

[Operator Instructions] Your first question comes from the line of Bhavan Suri from William Blair. Please go ahead, your line is open.

Hey, guys. Congrats. Nice job there on the year, and thanks for taking my question. I guess I just wanted to touch first on sort of the strategic pieces here, largely Voxter, as you think about it and obviously, the smart security, but Voxter first, it’s still early days obviously, but if you think about how revenue contribution will sort of graduate over time, I’d love to get a little more color there of how traction going, how the ramps progressing and sort of, if I had to look up three years, what does that offering look like as a percentage of revenue? I’d love to get a little more on Boston and then a quick follow-up. Thank you.

Sure. Hi, Bhavan. I’ll start and then let Ravi take the end of the question. We’re pretty excited about what we see in that space, larger UCaaS solutions for generally larger-sized businesses. As you know, we take very specific strategy in that segment where we’re offering a platform that’s very API-based and able to customize for unique needs of our customers. We’re also using that customization capability to be very flexible in working with channel partners. We did spend much of FY 2019, I think, putting the systems in place to be able to work with our channel partners more seamlessly. And really, FY 2020 now is where we’re going to turn up the whip a little bit on the sales and marketing to drive the growth. I do expect enterprise will be the largest – well, the fastest-growing part of Ooma on a percentage basis although, obviously, it’s growing off a small base to begin with. We see certain verticals we’re in today, where we bring in a unique solution to that vertical segment and believe that we can expand that capability to other players in those verticals. And one of our key goals this year is to grow our channel partner base and to really drive the leverage and the growth that we talked about. So we’re pretty excited about the opportunity, but I think the first half of this year will be an important time for us to demonstrate that increased sales marketing momentum. Ravi?

Yes, just one more small thing to add to Eric’s point, Bhavan. Today business, overall business, which is Ooma Office and Ooma Voxter Enterprise is equal to roughly 30% of our overall revenue and in three plus years, we expect Ooma business to contribute more than 50% of the overall revenues, and I believe Voxter will play a key role in that growth trajectory.

Got it. That’s helpful. And then one quick follow-up for me. Just on ARPU, core user ARPU these are little bit more important is continue to just grow nicely year-over-year. I guess if you look at the improvement in the metric there, if you want to help quantify sort of what would be the key drivers and I know you could say all of the ones that I mentioned, but specifically have you seen any change in either the upsell expansion? Or are the initial deals getting bigger with new customers? Or is it both sort of equally playing into? Some color would be great. Thank you.

Let me take it. Initially, Bhavan, I believe the biggest reason for the growth in ARPU is because of the mix shift as business gets bigger we will – and we get a much higher revenue ARPU from a business users than from a residential users, it’s a mix of both business and residential. So the mix of business gets bigger, we are going to continue to see the ARPU growth happening from that perspective. But to Eric’s point earlier when as we bring in new services, whether it’s 4G or other services, I think that could also in future increase ARPU even more compared to what we are seeing right now. So right now it’s because of the mix shift between business to business, but in the longer term could be for additional services also.

Yes, just to reiterate a couple of themes that I said in my opening remarks.

Sure.

We’ve invested heavily in Ooma Office over several years now, but we are getting to a point where we’ve got the feature set. We really want to have for that small business customer and it’s a very curated carefully done very easy to use and set up solution and we are able to now look forward to additional things we can do on the Office platform that we would charge extra for. And to degree that we’re going to be investing in R&D, you’ll see a shift more toward those kinds of investments, which is exciting for us as we look forward. We also talked about though being measured in our growth of R&D spend, so that we can steer more of our dollars in the sales and marketing, and that’s also a key theme for us as we look forward because we know we have the best solution in the marketplace, we convinced of it and we need to do more to expand the customer engagement for it. So that’s kind of how we look at all at this point in time for us.

Got it. Helpful guys. Nice job. Thank you.

Thank you.

Thanks, Bhavan.

Your next question comes from the line of Patrick Walravens from JMP. Please go ahead, your line is open.

Great, thank you. And I drop for a minute, so – if I’m missing the answer to this, forgive me. But I’m pretty happy with my Butterfleye camera and they don’t call that anymore. But what else can I expect from that in terms of sort of features and functionality?

Oh, boy – I’m –

I know –

Mine as well by the way, and I’m thrilled to hear you say that the customers who have got the smart cam have been giving us very good reviews. If you look at Amazon, for instance, and we’ve been happy with our take rate of additional subscription services on that platform. Obviously, we always like to be higher, but it’s gotten off to a good start, let me put it that way. But the new Ooma Smart Cam is a big step forward for us on several fronts. One is it’s both outdoor as well as indoor. You can put it out in the elements, it has full night vision at 1080p and it has longer battery life, and all the other great features of Ooma Smart Cam that we already have today like facial recognition, geo-fencing so it automatically turns on and off as you come and go just by your presence, et cetera. It also integrates more and more seamlessly into the overall Ooma Home Security Smart Security platform. When we look at what the Ooma Smart Cam, the new one that we’re just in beta now, but when we look at what that camera can do versus competition and the price point we’ve announced for $14,999, we think it beats all competition and we are thrilled by that. We just got to get it shipping and get it distributed throughout our retail channels. We also have visions to add more capabilities into the camera. We want to make the facial recognition work even better. We want to do other things and that’ll come with time because we can download the new firmware into these cameras anytime we want and upgrade them just like we can in the core Ooma platform. So we’ve got a platform for the future as well. But, yes, if you want to put cameras all around the outside of your house and let it run for a long time on batteries, and work even if you’re Internet goes down, which most competitors products won’t do, Ooma Smart Cam is the choice.

Awesome, thank you.

Thanks for letting me do a sales pitch.

Your next question comes from the line of Mike Latimore from Northland Capital Markets. Please go ahead, your line is open.

Hi, this is Vijay Devar for Mike Latimore. I guess most of my questions are answered, but I would take this one. So, how the gross margins on business relative to the overall corporate margins?

Vijay, this is Ravi here. We do not breakout gross margins between business and residential separately. But just to give you some color on that, my ARPU from a business user is around $20 per user on the business side and from a residential user is around $7 or $8 per month. So there’s a big difference between average revenue we get from our business user. And the cost is also slightly higher to service our business users, but not that much. So generally speaking from a color – high level color perspective, my business – our overall subscription services margin for the company is around 70% and just from a higher ARPU of business users the gross margins are more than our residential customer ARPU – gross margin. So, hopefully that will help you understand, but we don’t – since we have similar data centers and lot of other infrastructure, which is common. We don’t have very specific gross margins for the two businesses.

Got it, got it. Though this comment be around on the new features to be added on the smart security side and – but curious to kind of hear something more on the Enterprise version of the business. And do you expect to launch new features there, because I guess on the small business, it’s kind of a pretty much down with your R&D investments maybe on the enterprise side and the customization side, you plan to launch any new features?

Yes, we got new things planned in every area of our business. I’m excited that on the small business side, the things we’re largely working on now are new things that we can – which we charge extra for monetize our customers in new ways. On the Enterprise side, we tend to drive our development by the needs of the customers that we encounter. One of the unique things we do is ask our customers, if you wanted your phone system to integrate your business in a particular way, what would that be. And usually, we can do that for them, fairly, quickly and easily, whether it’s custom analytics or some unique call flows or doing other integrations into other platforms they may be using or what have you. So, we tend to let the market dictate a little bit where we go with that although there are certain verticals that we’re increasingly targeting and in those areas, we are thinking more generally about what to do for those verticals. We will continue an investment in R&D on new features for enterprise, but it’s – in our overall spend as a company, it’s not real big and it will be paced largely by the rate at which we add additional customers.

Got it. Thank you.

Sure.

Your next question comes your line of Josh Nichols from B. Riley FBR. Please go ahead, your line is open.

Yes, thanks for taking my question, strong finish to the fiscal year. I did want to ask, how long you think until expanding the VAR reseller channel and some potential white label solutions could really start acting as a force multiplier to the company’s existing sales force and we could see a nice ramp even further in business services revenue?

Yes, that’s a steady developing area of the company. We’ve already reached the level of 100’s of VARs involved with our Ooma Office small business solution, these VARs tend to be pretty small entities, maybe one or two people opt in that, that maybe more IT professionals that are now also going to offer phone service to the small businesses they consult to. On the enterprise side, we have a smaller number of VARs today, but we have plans to grow that significantly through the year. We do anticipate that when you bring on a new VAR, it’s going to take several months to get them train and facile with the solution. And then also some time for their sales folks to bring the solution to their leads and drive those through to closure. So it’s not a real fast ramp but within several months a new VAR can be productive and contributing and we have programs in place and people dedicated to growing the VARs, both on the office side and on the enterprise side. You’re right, it is a force multiplier. If – when an enterprise VAR brings several sales people or even a larger number than that, it can be quite impactful. And that’s the way we’re thinking about that since, in our minds, there aren’t many players like us that are willing to work with the VARs, the way we are and support full white label solutions, allow them to keep a closer relationship with their customer, do more value add and just being a sales channel. And we think that’s one of our strategic advantages, the way our platform works, the way we’ve built the system to enable that. And now where we are, as I’ve said here, working to grow that channel. So, I think – like I think, I said earlier, the first half of this fiscal year is going to be important time for us to show some real sales and marketing progress, now that we are ready to kind of take it on.

And then as a follow-up to a previous question, it sounds like on the office space, you’re pretty close to having the setup you want and there’s only a couple more things to add early on in the year before you can add some new offerings to upsell the existing base. Is that do you think going to be more of a driver like this year or do you think the selling opportunity lies more next fiscal year and beyond?

There will be some things this year, possibly around mid-year and then more things that come late in the year. We have couple different things we’re trying to do and I don’t want to predict precisely or anything, but – yes, our small businesses – well, what we provide them today and with the exception a few things they ask about. We try to give them more and make this more complex. It’s not going to be a DIY type solution that they can do themselves and that’s the whole power of the platform, in fact that’s the power of our business strategy focusing on small business with a solution that is custom designed for their needs. We don’t think we have any competitor that’s done that and our ability to set it up yourself, do it without running any wiring in your company, do it with great voice quality even on an Internet solution that they need more consumer-grade, than business grade. Those are real advantage as we bring to the segments. So yes, we’re going to push hard growing and as I said, in the middle and the back half of the year, hopefully bring out some additional things that we can take further.

Thanks. And then last question from me, you’ve laid out a pretty good roadmap as far as office and enterprise, were some of the expectations for this year and the push to increase sales and marketing, but could you spend just a minute going over at a high level with some of the assumptions are for this year regarding Ooma Telo, the home business as well as the security offering?

Sure. We’ve talked for many quarters now about how we have steered more and more of our sales and marketing on to the business side of what we do. And really have reduced to a much lower level, the amount of sales and marketing we put on Ooma Telo for residential. That platform is still growing, but we don’t expect significant growth from it with what we’re spending and doing. So, growth on the order of what we achieved in Q4, it’s kind of how we look at things going forward. And now the question becomes, can we expand on the residential space with the additional capabilities we’re adding to that platform? Ooma Smart Cam standalone – it’s fantastic video solution for the residential space, and that’s something that we believe will have out in the market quite soon and will be able to start driving from a growth perspective early here in FY 2020. On smart security is out and available. We have many happy customers, but there are still components for that solution that aren’t available yet that we’d like to do and I think it will take us a while through the year to bring out all of those things. So, we are not putting as much emphasis on smart security at least in the first half of the year. When we get to mid-year, we’ll give you more of an update on smart security and what we intend to do on a broader basis with that, but anyway, we couldn’t be more thrilled though to be powering ahead on all these fronts and we’re putting a lot of work into some of these areas for a while, and I think were we can see, we’re getting there.

Great, thanks for taking my questions and look forward to see you. The story continue to progress as we move through the fiscal year.

Thank you.

Your next question comes from the line of Nikolay Beliov from Bank of America Merrill Lynch. Please go ahead, your line is open.

Hi, this is actually Jacqueline Cheong on for Nikolay. Thanks for taking my question. First of all, I realize there is no official guide for subscription revenue. But can you talk a bit about how we should think of subscription revenue growth going into next year?

Hey, Jacqueline. This is Ravi here. Happy to – so, if you look at our product revenues. Generally speaking, has been consistent around $12 million or $13 million per year and it may go up slightly or not, but we are expecting our product revenue to be close to flat from fiscal 2019 to fiscal 2020, there may be a small uptick, but not too much. So all the growth which you are seeing is largely speaking coming from subscription services revenue. And one more point, at Talkatone, I’ve assumed in my guidance roughly $4 million for the year and in fiscal 2019 it did close to $5 billion, $4.7 million. So I think the growth in subscription services revenue driven by growth of Ooma Business and some small growth from Ooma Residential, Ooma Telo also. And as Eric said, smart security is something which we are working on developing it. So that is more – we have been – we have not assume too much growth from smart security just because it’s not out there in our fiscal 2020 revenue guidance, we are investing in to, we are very optimistic about this, but at the same time we want to make sure we are managing the expectations along with as how the results come out. So most of the growth is going to come from Ooma Business, as well as some from residential growth.

Awesome. Thank you. Good color. And can you also talk on what you’re seeing in the competitive environment? How has Voxter changed your positioning and are you seeing improvement in your win rates?

The biggest thing we’ve seen so far having we called Ooma Enterprise now and having it in conjunction with Ooma Office, we’re finding when we run our marketing programs and bring leads into follow-up on, but we’re able to close more of the leads, because we have a solution for just about everybody now. We are also finding that some of the companies may be bigger, but they only need the capabilities that are in Ooma Office. So a company we might not have targeted is now becoming an Ooma Office user and we are thrilled by that. We have customers today, who are hundreds of users, in using the Ooma Office. On the flip side, we see customers sometimes who have more of a full UCaaS set of needs and they may be smaller when we post recently is about 10 users, you think that is an Ooma Office customer but they needed some things that are Ooma Enterprise does they become a great Ooma Enterprise customer and that’s great example to what makes Ooma special, we did a relatively unique interface customization for them between how they use sales force in their business and what they want Ooma Enterprise to do. So, we are seeing the sales and marketing synergy between the two and so – and that’s made a stronger. So I guess, sort of answer is, yes.

Got it, got it. And then maybe one last one on the topic of ARPU, besides the mix shift have you seen any ARPU uplift due to Ooma Enterprise and any color on the customer split between Ooma Office and Ooma Enterprise?

Jacqueline, this is Ravi again. So let me answer those two questions. Yes, the Ooma Enterprise ARPU is higher than Ooma Office – Ooma Office customer ARPU. But since Ooma Enterprise is so small it is helping with, improves ARPU, but not much because it’s from a very, very small base. Is that helpful?

Got it. Thanks. Yeah, that helps. Thank you.

I’m sorry, what was the second question?

There is no further questions at this time. I will now turn the call back to Eric Stang for closing comments.

Well, thank you everyone for listening to our call today. We couldn’t be more thrilled to be ranked number one by Consumer Reports and number one by PC Magazine because we do the business we want to make sure we have the solutions out in the marketplace that customers most value and it’s very heartening to see those results from users telling us that, and it gives us heart that is we can steer more of our investment in the sales and marketing that we can continue to drive nice growth for the company, which is ultimately what we’re trying to do for all of you. So thank you for your time today and we will look forward to, next time we can talk to you. Bye, bye.

This concludes today’s conference call. You may now disconnect.