Palantir (PLTR) 13 Feb 232022 Q4 Earnings call transcript

Good afternoon. I'm Ana Soro from Palantir's finance team, and I'd like to welcome you to our Fourth Quarter 2022 Earnings Call. We'll be discussing the results announced in our press release issued after the market closed and posted on our Investor Relations website.

During the call, we will make statements regarding our business that may be considered forward-looking within applicable securities laws, including statements regarding our first quarter and fiscal 2023 results, management's expectations for our future financial and operational performance and other statements regarding our plans, prospects and expectations.

These statements are not promises or guarantees and are subject to risks and uncertainties, which would cause them to differ materially from actual results. is market our our closed risks distributed press SEC those the after today concerning available earnings in release filings. Information and in as no by undertake obligation update statements, We to law. except forward-looking required

adjusted addition course isolation of from or measures we to non-GAAP Further, during as financial considered a today's These in the measures. be in not will GAAP call, refer measures. certain to, should for financial substitute

in GAAP our non-GAAP these including of measures, measures, presentation is comparable today. included release Additional information about provided press non-GAAP reconciliation investor and to

Our are press Relations investors.palantir.com. SEC release, investor presentation available website and filings Investor on our at

Over the year-over-year of call, reflect comparisons, discussing when to we will stated. course growth rates various rates the business. unless These our otherwise refer

Chief Officer; Chief Chief Executive Officer; on me Joining Dave and Officer and Taylor, Karp, Financial Chief Legal Revenue Officer. today's call Alex Ryan Glazer, are

Shyam with Technology join could be our lines front as also who You'll call customers. who today's Sankar, from remarks, a not prepared one our hearing of the few on Chief Officer, he's

now for it remarks. I'll to opening over Alex turn

Palantir, talking events be of would There talk about lot have we to philosophy. this a a about macro year. At tradition

the warfare have I of of impact time, role and world. in think Palantir's people seen digitization central for first the the

the Palantir, by to to on big for on this, in brought of world, GAAP to it our with the inside. aside the interactions world talk earnings outside seem time, the you context I Leaving transformations the profitable. would is in be and broader the love the call, about of more the context Palantir of first equally our

thought about if you you be profitable? so in perhaps. product often talk well, good, why market you in discussions, promised XXXX would my of revenue. I, it's in most product, about We profitability which asked, about fit, I'm talk XXXX, And GAAP aren't GAAP occasionally talk

GAAP We year. this to we GAAP are last in plan and the profitable now, profitable, quarter, be in

several profitable become What that no profitable? expected? the does like Company seemingly of around business? it years it how tech What did profitable? our becomes a profitable? mean mean GAAP there's that, ever lot of it questions company for sectors GAAP before our company Obviously, we anyone does made is Why What

supporters world's who those move company for most of important that been you a was of is port in context long-term to and it profitable to the doing perhaps because have strength enormous, big institutions. DPO. producing we're the in march even that gives from is our And continue a power as proud -- Palantir, watchers or products company of most us institutions a support the the our world that But as to the this

you. Thank

decades, As profitability GAAP our company, the quarter. two first after time highlighted, Alex achieved last nearly for

one Our after first And the business company's of in most quarter focus has our the chapter our of investment history. been profitable on durable in in our of significant world. the companies represents beginning software building new and years a

in from In of and from our operations. QX cash $XXX in quarter generated million $XX we consecutive eighth generated XXXX, marking positive we million operations, cash revenue,

operating challenging whole operating adjusted the growth facing line to on top one revenue we deliver While our margin. results, has particular, line our as and most bottom the in environments industry been a in technology years, combined of continue and

business revenue million commercial quarter. of last Our $XXX generated

converted of quarter date the We U.S. the ahead. reaccelerate opportunities set year-over-year, up an customers, program, from to most the XXXX. our and about strategic business business and result pilots ended XX to commercial in slowed While and investment revenue our our U.S. quarter catch-up XX% our fourth we the prior commercial customers U.S. in confident in remain a with as XXX quarter commercial increase revenue the of in quarter contracting momentum

in including health hospitals. sectors. hospital nation's with Clinic, We care, several the supply systems, last automotive utility deals than manufacturing, the in signed of chain, more and The health are in oldest largest care energy, closed including of Cleveland doubled recently strategies, teaching deploying General increasingly year. Tampa number focused the go-to-market the one We of and

recently for-profit care having sites. year, operator XX% the deal a this X,XXX continues four represent an health of entire over American hospital signed of with Together, systems States. hospital momentum United system the in Our nearly these

clinical forklift the customer were pharmaceutical Coca-Cola and ML distributor, products. U.S. of and And learned also Cardinal manufacturer our chain consumption Komatsu. we distributors called supply after sector, Handling, In at recently largest into combine region. with and AI comparable both Health two using the Toyota work supply EMEA to we the and chain real-time purchasing executives deploy began at of and began work the data Material diagnosis bottlers to in for a Foundry and data

business to in helping with including XX% Foundry SOMPO commercial Company, where health quarter, and management, security multimillion work Holdings, long-term a of through a well-being a strategic year-over-year and dollar is with international the improve Our partnership to data-driven expansion risk $XX digital million grew fourth five-year our GardaWorld security, transformation. deliver CrisisXX, and

$XXX XX% we business this overall government million well year-over-year. board the across Our past saw quarter, revenue generated in an as growth as increase of

up continued government the year-over-year, expansion QX, consolidated of events QX. XX% Palantir's part up Digital, year-over-year, systems. software a as pressing XX% saw enterprise effort our U.S. in the activity to military growth the which well of our government Likewise, global as agreement with modernize strong signing contract of British on international in business Defence including Our its reflects work business the supporting was the

Kingdom across our U.K. of intelligence value agreement to the expect overall. defense up GBPXX this United we further million, of business growth as government the With well the and accelerate with as to customers partnerships

while to and our business. ahead through expanding long-term commitment our the acknowledge fiscal growth. challenges This profitability management We illustrates strongly for GAAP and responsibility poised quarter's remain margins

to I'll now turn it over Shyam.

overthrow Foods, of our million the Tyson companies In German to the XXXX, to foiled through delivered energy software plot government, return a empowered $XXX crisis.

that's easier works, sell. to software fact from stems not built the that have momentum software Our that we actually

an product your programmable business X people that We Ontology that The business parts of This compute XX is publicly of announced Foundry our just is But to your is the mean link you ontology. computable. doesn't your to compute at it's insight computable controls, human with requires Con Foundry cornerstone enabling because vision how really it. weeks know matter. ago.

that Foundry, the use the $XXX that XX For a Foods to them. of back centers optimal allocation Tyson's decisions into of for Tyson value million trucks implemented calling determines among model delivers systems, by automatically work inventories example, and This their distribution in delivered ERP the ontology's cases Webhooks. and

doesn't this. Upgrading It make do SX your better. business to doesn't

to pricing each and to don't Your ERP systems each and talk other. planning other. MES tools don't platforms talk

and logic is across understand to or systems. sheets, harder change Excel to your business That scattered improve. and makes escape business employees So to hard yet

need software their customers existing systems. orchestrate and Our to connect

business Your is computable.

and focus on view developments our is This through it. compute to Foundry product our XXXX. driving need a ontology You

Turning to Apollo.

it's Just doesn't because you know your of to mean valuable. how business compute parts

cycle to Not have the need in edge push complete learning. You connected every out your do of deployment to be and the business. to factory the to able development, only to to node floor, you your logic

You be need to it repeatedly. able to do

cloud only critical that also technology Apollo CFO's As but costs seek CTO's reduce not the companies provides to the and problem. the eliminate problem, solves technology enabler headcount, DevOps aggressively

reducing achieve authorization with traction to at of Fed cost. continuing to fraction time and customers record also while DevOps in which see Start, the a Apollo-based FedRAMP We're still enables offering, our cost

fires today already and for Recent of European For and to the AI-driven XXXX, theaters, against the have is both and across events Middle we from domains Gotham superiority and the Gotham AI-driven operating system targeting defense. target the development. Gotham Eastern, are development focused proven detection space on In Pacific of continued mud. all

step versus python for before. a kit model and proud development OX a We're was or possible three A privilege upgrade hours using operation, wrote of units four targeting to Gotham and CX deployed what set. thankful in this of mission Chad recently supporting software the his fires change

Dave I'll through take pass to financials. it us to the

XXXX of was for milestone quarter quarter fourth a us. The

in history, stock-based the This securities narrowing time achieved we've from driven and management discipline, line Company's fiscal and compensation of losses first of bottom a acquisition and the Japan For our top Palantir GAAP marketable by venture. the from of gain our continued line our outperformance, the joint profitability. was

back our years full profitability our XXXX. we the GAAP in profitability strength, be XXXX GAAP first to of of of several year that goal On expect of original ahead full year

XXXX, XXXX, total sequentially. growth we of Turning to We $X.XX in in million XX% generated revenue quarter rate billion of in rate $XXX results. We growth a in of a fourth XXXX, revenue, ago top representing line and our generated $X.XX over up year global X% billion revenue period. representing U.S. the In year-over-year in the year-over-year. XX% XX% generated

Fourth quarter year-over-year of Revenue top existing year-over-year XX% million revenue the XX-month U.S. Overall, XXX%. XX from and our revenue In Customer million. XXXX, $XX customer. increased dollar quarter-over-quarter. was XX% quarter to net $XXX customers to continues expand. to year-over-year per customers from fourth count XX% grew retention X% our trailing grew

segment. compared the million these of million to grew the commercial grew in customers overall strategic between In quarter our Now XXXX, commercial million $XXX first investment the anticipate fourth from contracts to XX% moving $XX to our XXXX on XXXX, first $XX was in our to and revenue revenue revenue of in from $XX of We quarter. fourth XX% year-over-year XXXX. In quarter sequentially. be revenue million. quarter to the Commercial X% year-over-year commercial commercial million $XX

$XX macro U.S. headwinds revenue investment of the quarter quarter million. commercial was the in but from the a well million these catch-up customers. full year-over-year environment XXXX, down as to saw outsized our U.S. decline as from Our to $XXX year commercial of program revenue grew on we revenue given customers fourth XX% year-over-year prior revenue as strategic impact grew in In XX% the sequentially of

marking Europe. XXXX, year-over-year commercial growth. Our In and international XX% sequential new XX% U.S. fourth and quarter grew and the year-over-year customer grew quarter XX% count eighth sequentially the by driven of of deals APAC, quarter-over-quarter, Canada consecutive in business X% our commercial

million government In government revenue In sequential we And sequentially. representing the last year-over-year to segment. driven of quarter business deals to of $X.XX in a U.S. of rate the $XXX million. XX% generated XXXX, of XXXX, generated XX% revenue, government rate growth government quarter million a we government $XXX XX% announced Turning and commencement the government certain quarter. year-over-year. The of to X% in our by U.S. representing business XX% fourth in billion. our was in We year-over-year U.S. fourth XXXX, growth XXXX, year-over-year grew $XXX grew growth our

billion, billings remaining million billion, was fourth We were Fourth bookings total obligations. was $XXX $X.X remaining deal year year $X.X billings in in booked and $XXX billion ended Full performance Full up value TCV $XXX year-over-year. million. quarter with TCV $X.X XX% were year-over-year. in X% the XXXX up quarter million.

for termination our is of an and with clauses, XX reminder, of contracts primarily a common obligations account our into that take business. fall as commercial RPO beyond months in initial not government comprised of than does convenience business As term it less both are which contractual

Both remaining strategic deal remaining from from and the investment on value faced headwinds program. the macroeconomic performance customers impact obligations

result, the our financial the impact quarter condition down remaining these of As the as $XXX contracts total value was progresses. monitor the to as we from deal investment value and continue continue program total We'll year our review a since last to of businesses. strategic million the commercial

employer XX% gross and to and Adjusted which were stock-based was $XXX focus sequentially, and XXXX to the on year quarter X% quarter for the for expense. compensation XX% took Turning excludes billion. roughly and expenses efficiencies. measures when $X.X reflecting excluding related margin, Full year adjusted expenses, stock-based margin compensation spending quarter. expense, were down we our payroll adjusted discretionary taxes, manage in Fourth million,

points significant Full from $XXX $XXX of adjusted adjusted stock-based additions fourth million. operating excludes payroll year on the well guidance margin Fourth XX%, of our related and from net The which was employer our quarter. representing savings headcount R&D income moderated from operations by taxes, driven ahead spend adjusted quarter beat was disciplined as income and million, management prior was income our basis an guidance. operations from compensation cost XXX efforts XXXX adjusted operations, as in

the compensation ago our our a the period becoming with to the move as to $XX million fourth loss overhang macro disciplined compared is stock-based expense ago as the expense in quarter to spending to of $XXX well a This year as an normalization breakeven fourth was of down The compared company. year we down XXXX $XX of public quarter Stock-based ever income GAAP period. amid since and million closer was million. operating operating strongest compensation the our quarter uncertainty testament

spend our to exercise XXXX, As continuing look out continue the invest pace hiring to we building high Company, our ahead we to roles. will discipline product areas, strategy priority technical offerings, in go-to-market including while and across in

operating year income in full our anticipate for the profitability the over GAAP GAAP of margins XXXX, year. to improvement addition In we course

from quarter GAAP million a strong sheet, This million on of our from and to operating the income Japan a marketable in $XX of to Fourth million. of of balance losses joint result acquisition investment GAAP net gain income quarter million $XX was addition $XX securities venture. $XX was our Palantir narrowing a

performance But it's and profitability not that just I'm excited operating our GAAP about.

Our margin Rule the full score quarter year combined and operating XXXX. was fourth revenue of to the adjusted to strive XX third XX% and full consecutive XXXX, throughout of a will excess our in XX% and growth in in that continue achieve we year

earnings GAAP quarter Full $X.XX, share earnings earnings share per of positive Fourth per per year GAAP per earnings share $X.XX. was and $X.XX, quarter marking adjusted EPS. GAAP was negative first our adjusted was was and share $X.XX,

cash and from consecutive positive in million XX% In of operations. the our operations, margin fourth representing eighth quarter $XX a of generated of from quarter we XXXX, cash

year operations, representing flow in XX% the we $XXX For generated margin. from full cash a XXXX, million

the cash revolving term We loan ended in up additional billion cash facility and and both delayed entirely We to credit million our no quarter equivalents, which equity undrawn. access facility, $XXX through retain with $X.X to fourth $XXX of $XXX million remain draw and million debt.

our outlook. Now turning to

we adjusted million. million XXXX, of $XX revenue expect $XX between million from of and and operations million $XXX QX For $XXX to income

and to XXXX, operations year $XXX $X.XX $XXX $X.XX income. revenue between billion net and million we GAAP adjusted from full income For million of of expect billion, between

contributions to our a Jeff to moment to questions, Chief to on has to from opening continuing stepping Buckley, and the ago be weeks to and been of Before public transition. member successes. few after will his he'd of after Heather staying Officer, the the team's leader seamless on for a a a We're filing journey help to like company Jeff Accounting call forward for team up with incredible XX-K, We us Planishek to take the Palantir. on outgoing Jeff's announced down with our that I'd thank an a role a build be private to promote excited our grateful and he and that the we're look both company.

turn over I'll to that, the Ana it to Q&A. start With

to We'll open when question shareholders who up profitable? related questions top from we is Palantir Dave. call. a few with profitability, one our all before the to begin the is number asks, question with Thanks, GAAP Abraham The going become from

year a we profitable, on were we're Well, and profitable this year basis.

and if at because private get anti-terrorism, in questions the we've seen I are and come Europe. the from think the We've especially of just others, products -- us questions we clients gotten context I that in is, in you questions know to one look them the and public well, of in the transformational. main

literally depend Europe. users pandemic the thousands and, think so of for We've at history product the there you realize question lot aren't point, context changing context seen this in of that on took And think than them we on why course Eastern thousands a it's survival. and so in I the countries, now powerful our and of the if good, outside and are this seriously because But profitable? the people more precisely I of in

guaranteed. many financial this and of and are obviously the our dependent people know attenuate depend in our while product want price, watching future highly is have lives to And share stability us that the been on whose on very now to us

been has get this priority this So a much us more to to of place.

supporters be long-term shareholders will this and and in have we we that year. happy I'm interested continue are profitable that this, to

so, a achievement just it's Palantir. major And for

next companies is the because question. underlying With reason question into no question gets that products. GAAP call of the Yes. think And tech become does that, their ever another value profitable. seemingly, asked I

Thanks, Alex.

questions Palantir few How AI a and does received differentiate compete Chat the also solutions software and on clients? and demonstrate GPT potential other for AI. return with investment We on

in There's AI, consumer been bear. brought of technologies and have and lot a talk events been that recent about open to Internet incredible

adversarial basically Palantir the rest interested nonpublic I the was with in at not took time also countries. think battlefield. very military, working the of potentially over Silicon offices the in opening digitalization event the AI is on in actually Valley programs when biggest

AI most bordering purveying joke, of a time, partially fraud. on PowerPoint form At the it a purveying some were and was people

lot last in this that the and The so at AI And a you spent the to five train in would Europe. had the of pudding need core proof we Eastern years and power going infrastructure into algorithms. building is look simply thought events

companies interesting we enterprises, is so networks, five that context AI And in that the the world private in in how to build. every the country will years and But what's allow do super technologies have other institutions take to you it. looking built four will precursor consumer is technologies to or do

do at regulated. and almost our clients, are AI in gas how a regulated. do another. regulated. or regulated. is Manufacturers care Oil regulated they're lot all Health in Look example, you form context? a For Hospitals regulated is one is of

an same run just private network can't non-regulated You way on could network. on a public you algorithm the a

What may is the chain because for do of security the then using the of be context, Under authority? the the AI decision? transparency other decision? product does maintaining working the security, you know side? And responsible? make made conditions you there's the issues, it some issues. How how what is In who if there's do while actually AI war people the Under do

and that are to now There's required just which years to across going consumer our thousands and allies build, of to our thousands world of continue and to software supply customers. here issues years we the

and adversaries. fight excited excited our very the the this, about about we're excited So interest to very, about bringing

SBC? on received hoping We including who questions is what at Christopher, from SBC reduce few asks and Alex. dilution, one a to Thanks, Palantir point

last on been and laser-focused years. we few the SBC We're Christopher. Thanks, have

that XXXX, SBC. quarter had million we of back the QX quarter of go public, we you $XXX to in If that went

was and last it QX six million. quarter down XXXX, You our $XXX just only SBC, versus of quarters, year-over-year. down XX% been to XXXX XXXX go each is sequentially The we've quarter last with back

ultimate is in answer around And the really answer is look And yes SBC now yes. is XXXX, are forward as we Stepping the test as the like, QX. yes back, It's GAAP profitable? you well. to there

we employees in overall, you that are current that of profitability. Equity align see And want sure sort which all in stockholders. resulting make the GAAP and our results, we to

top plan profitable. we keep on to alignment, so to push the the And margin stay improve to and that GAAP line,

is question what next Thanks, for Dave. Zachary goals asks, you, Ryan. Palantir's XXXX? This for primary are

heads doing, which and planning doing delivering critical We're to bottom on delivering growth, profitability, their down, been what and means we've keep customers on an both line means what top Zachary. GAAP with Thanks, growth. revenue to towards specifically laid operating we've out. missions And to keep that our adjusted focus our is continuing our as line, on long-term eye margins

In year-over-year. the space, grew we XX% U.S. commercial

expect highlighted in to we I strong and year, into As another have commercial. momentum a landmark deliver earlier, going of we of lot indicators this year U.S.

one means or defense, that, factors space. In down of such extremely on government our the civil to most we'll not are long-term as backbone might and accelerate outlook timing that seeking obviously, doubling U.S. on whether And important our government of continue there's the customers, space, U.S. continuing intelligence there the of which is strong. our resolution business, affect a but

profitability. health particularly to business owned missions. around to our the most government. care we're over looking that we've and In our world on the while our grow momentum all continue that, important the the about of keep doing the space, allied the countries excited work deliver XX are outside years U.K. the We're looking seek as expertise international civil. in in We're deploy to looking we GAAP to in And U.S. defense to grow

security profitability this networks. to this in will around world in maintain health especially around the A see is in people care. that the discipline our where our contribution see war. see of this We commercial different around We in AI areas. U.S., because embracing GAAP models, We the private technology, AI, especially in We with see version crucial this especially West. we precisely are recognizing is the

continue just that is than they financial of drive our important, there's and Western ability in tethering and we to believe a so the And institutions survive crushing adversarial better between service our discipline institutions. what and

Thank Alex. you, and Ryan

question then to next on turn Brent, Brent camera Our unmute receive and is prompt you'll from your please your line. a with Jefferies.

it if Dr. an update. relates Karp, business, to us curious you government I'm give could the as just

were you I not sure handful ultimately a had pushed last could and there, of got think year, that if transactions what you mentioned happened exactly address there that?

just then things conversation there about you're secondarily, just to and I reporter comments CNBC strategic multiples maybe just this at that just in thinking I'm to curious point. interest was how was And had what if gone recap ultimately a think you can where some you And spoke have that Palantir. about current and you

being reporters The Taking asked motion the you an to the Ukraine asked last government. commercial the proves enterprise from number -- asked in second general look, sales five question and a enterprises since where software enterprise, -- in years, or we first. has Really, in -- a have moved part have the war whether we've general, move in been of me existential this. were the of a

I in in that know pretty crucial It's part this clear this think that people your years entities networks And enterprises commercial of most take to regulated private anywhere allow that of technology America, know build. the we've built this. available and also of enterprise. years a clear outside you do else. It's is that not context proprietary but in this America it to will would not is

-- in in have a Palantir a generates you not that just interest in lot way that didn't of And before.

in winning, Palantir we institutions to focused And this our interest we're basic believe our Because and going we is winning. us. buying view think a there's our stronger. potentially which we're but us, product, buying in pretty to of are in is We so be lot us software West the make I of of on in are

about So very that thinking all. at really much not

Then might on government resolutions. the The that that all people that's has government, want you're speculation these U.S. Gratified U.S. there's continuing about -- really there's over to buy government. been irrelevant. asking us, really but

the number that a in no really large-scale of works. There's contracts update. are have We

going of is coming Washington. is call the seen The people in And only what's with just that level know. historically has year-on-year? regulators, the in on I don't update coming does do we It's CAGR people what from over what been in provide. Washington I because our different on. government XX%. and a have interest there's -- that also just from mean It's Congress this know military U.S.

And support among time there's going in whether people don't thing over the that the be a that's us society. in I East more will I makes open valuable, who think us debate whether future represent wars another the future, past. to the support or in it's our or see every you you would news, balloons Palantir the say

in that This and, is are. world a also years And has XX general, the weaponry. AI-driven that last no this on other on in we for is the dangerous than focused And software-driven company we been are world needs programs. these

short The I'm version the optimistic. version So is is very long no news.

Alex. Thanks,

unmute line. America. Mariana, is question and turn on Bank you'll receive prompt your of camera your to next then Mariana please with a from Our

that So is the Do drivers revenue about my the question into mind describing next are main year. you what make... growth

way, We we what drivers. you. the you lost -- the are your after main By lost

affect what think is our us drivers main the asking are that year? this build revenue I what you're will

All me can you know or still right. if I don't not. hear

to if words you know do to say my... guys -- say I'll want a or on launch I of this Sporadically. you want into couple don't me

Yes.

you. thank think I --

momentum commercial strong. like highlighted, in we as is think U.S. I So

in to government, it our our key critical business. to part a obviously of business. growth U.S. expect our We be

international Now in the on defense-related we of more expect working QX that half it's we're I the continued the initiatives year. later and second to business, in see And then that deliver to on. of coming think

our... will those drivers combined, be think the for I key

that roughly XX% -- more our U.S. one from business of a Maybe the comes answer direct is or

it of a I'm commercial north I met I lot our with that there's that on severe lots may commercial. that, recession, just think to bullish XX%. of There's reasons recession course, -- enough, I of suspect will will fact our team. that. revenue U.S. grow. indicators a positive main the the and continue of the grow that is have will despite in affect for The we

But XX%, lot a XXX enterprise our of a top parts and buy the we our XX% product, which almost last growth. room XX you our like then from growth. product. X,XXX customers something of And the most we U.S., positive all XX% companies in lot only not year. least, have to -- see U.S., means in the It's And the have went of buying importantly, of arguably, for last

So U.S., decision us forcing Company, the outside historically business the product it's is really world. which our CEOs the sold on over we all for

the It's and product, of a buy They cycle something and are doesn't margin. it's they've matter. gives and of many storing having compute the suspectful people. subdivisions, products a Really U.S., it's that just they're gone CEOs. data there's parts through Inside people IT the for seeing enterprise they're a different a to you and also friendly lot that model churning new things, of your are And not results, and actually of expensive. very

it the looks So very U.S., strong.

that business last in government, The about. year. grew our commercial asked U.S. been is weakness we've already just around non-U.S. XX%

It's I clear although protection. to not friendly innovations. they'll react AI AI, of new a do how outside U.S., they're the lot in can we context to less data think the

a have in technology. of just You new to lack of resistivity parts Europe

So the nations larger to macro part the is be of environment over-under by adversarial America business strong is, the will help suspect and XX% our I us. growing largely is our business. is will of driven that a

to very think like are and product And strong to most the looks be it MetaConstellation see way Ukrainian country very willing to likely about because talk international its the your I government, defend allies the cost-effective then world. over time in value. that's And our

already seeing of very the border being a very, product. and we're of -- So on lot in I adversaries, see that countries this interested are

this being the of think business. as the I still part a a real think drag economic is U.S. I a strong. and our would being is U.S. So, possibility events think which way in International just is of of as significant the Europe, government cultural about the -- and

and So that's over the under.

Alex. Thanks,

turn on please is you'll your receive Our prompt Sachs. a to from Gabriela, last Gabriela your line. camera question and then with unmute Goldman

of on Great. follow-ups commercial A your business. couple

little give the detail pipeline you deal any a the of could close on And large macro as in large to Firstly, how specifically? our the ability impacting evolving? deals us is U.S. on deals the

towards in and suggests $X And mix $X deals, large opportunity? your you million seeing about range, to million are are engagement between smaller to your potentially million think the from the to you landing that you half of U.S. that then seeing engagement path date secondly, of are as date dollar customers kind a quota classic deals small the kind

Great.

So I question, obviously think our first are we're one, growing. customers seeing on largest the

If at XX customers top there. we have, growth you we're seeing the look

As the in that's you volume size space. and customers into average on is because customer part we're of of that our to the decreasing, bringing the customers see

think seeing at into convert enterprise the smaller QX, deals in in a momentum I on, both of so, deals, the -- larger we customers growth And but same I think we're longer-term seeing a these within and come space. we're customers number there. particularly quarter, convert and set in saw seeing And customers the of large customers, smaller a broader of number which we're those the time, commercial

lot get point, set a in smaller can think, the there a same broader from price as grow we're ability a across that a of sell range a at seeing we at of way in well. also to I price the then customers smaller started but time,

and million. business our deals, $XX almost that's large are XX% of

that. some -- that love So people

it we're because more means a little I Some people loved recession-proof. don't. it

stories, X.X -- then of two of a two The average you the cities. revenue to size tale have million. from small went just $X over So tale

contracts. $XX It's well It's decreasing customers contracts. don't So They doing million for decreasing U.S. $X buy million exactly U.S. the buy $X it's million, commercial the reason in says. Most decreasing. Ryan we're because

I the on of see of lot see more What there We think our a a people I believe we're lot that. to going to wanting ground our software. are use software. in

So a price point. lower to we're open

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call. Thank you. That Q&A for concludes today's