Avaya CEO Jim Chirico On ‘Landmark’ 2021 And ‘Reshaping’ To A Cloud-First Company Bent On Breaking Records

‘We grew full-year revenue by $100 million, which is a first. I think equally as important is how we’ve been able to reshape the company; really becoming a cloud first company,’ Avaya CEO Jim Chirico tells CRN.

Avaya spent 2021 shattering records in cloud, partner, and subscription revenue. In the process, the formerly UC hardware giant has reversed more than a decade of annual revenue declines and has come out the other side as a formidable software and services company, Jim Chirico president and CEO of Avaya, told CRN.

“We’re having a year of many firsts for the company,” Chirico said. “We grew full-year revenue by $100 million, which is a first,” Chirico (pictured), said following the company’s Q4 2021 earnings call. “I think equally as important is how we’ve been able to reshape the company, really becoming a cloud-first company, along with continuing the leadership in large enterprise communications.”

Avaya’s cloud annual recurring revenue metric, OneCloud ARR, grew a whopping 177 percent to $530 million in the final fiscal quarter of 2021. “We expect that number will basically double as we go through 2022 to $1 billion and then double again to $2 billion by 2024. The company has been very clear and purposeful journey, and one that is customer-led and will leverage the vast ecosystem of channel and technology partners,” Chirico said.

About 20 percent of OneCloud ARR came from customers generating $5 million or more in ARR, according to the company. More than 95 percent of the company’s ARR is from its Enterprise segment.

[Related: Avaya CEO Jim Chirico: ‘We Are A Software And Services Company’]​

Avaya’s Cloud, Alliance Partner and Subscription (CAPS) revenue, which has climbed all year, hit a record 44 percent during the final fiscal quarter of the year compared to 33 percent in Q4 2020 and 40 percent for the entire fiscal 2021.

The company in Q4 2021 signed 119 deals with total contract value greater than $1 million, 18 deals more than $5 million and 7 deals worth more than $10 million. Avaya added approximately 1,600 new logos during the fourth quarter.

“Those numbers speaks to not only how far we’ve come, but how quickly we’ve been able to get there,” Chirico said.

For the full year, recurring revenue was 66 percent, up from 63 percent a year ago. The company’s goal is to grow its recurring revenue to account for more than 70 percent of its business and is on-track to hit that goal by the end of 2022, Chirico said.

Software and services, on the other hand, accounted for 88 percent of revenue, which remained flat year over year.

Avaya in August acquired CTIntegrations, a contact center software development specialist and systems integration technology partner, to supercharge its Avaya OneCloud Contact-Center-as-a-Service offering. The company has been seeing significant growth in the cloud contact center space, a “huge” area of opportunity for channel partners, Chirico said.

About 60 percent of Avaya’s OneCloud ARR, was generated by contact center customers during the company’s fourth quarter, the company said.

Avaya has about 160 North American-based channel partners that are now that are positioned to sell the company’s CCaaS solution alongside UCaaS. Chirico expects a “significant” uptick in CCaaS volume through the channel headed into 2022.

For the quarter that ended on Sept. 30, Avaya posted revenue of $760 million, up 6.2 percent compared with Q4 2020, marking its sixth consecutive quarter of year-over-year revenue growth.

The Durham, N.C.-based company’s non-GAAP net income was $74 million, or 77 cents a share.