NICE's (NICE) longer-term AI opportunity remains incrementally constructive, though near-term conviction depends on visible execution, as strategic renewal J-curves are still playing out and AI adoption has yet to be reflected in financials, RBC Capital Markets said in a note emailed Thursday, following meetings with company executives.

Management believes AI agent proliferation will boost total contact center interactions, reframing the "fewer seats" bear case, the firm noted. The brokerage does not believe upside from personal agents is reflected in current financial estimates, according to the note.

NICE proactively secured AI commitments with its top customers ahead of upcoming renewals, offering product discounts in exchange for waiving competitive bids, driving the Q1-to-Q2 cloud deceleration, the note added.

Management highlighted a step-change in win rates following the close of the Cognigy acquisition, including securing a recent new deal against key AI-native and legacy vendors, the brokerage said.

The brokerage said the company is moving to interaction-based pricing with minimum contractual commitments and flexibility between human seats and AI interactions, which creates multiple annual recurring revenue growth paths.

RBC kept an outperform rating on NICE and raised its price target to $145 from $130.

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