Sprout Social (SPT) 2 May 242024 Q1 Earnings call transcript

Thank you for standing by. My name is [ Dee ], and I will be your conference operator today. At this time, I would like to welcome everyone to the Sprout Social First Quarter 2024 Earnings Call. [Operator Instructions]

I would now like to turn the call over to Jason Rechel, Vice President, Investor Relations. ahead. go Please

have Welcome With Call. operator. and our Social's Quarter Justyn found Joe today First release presentation, CFO, updated Thank can Howard; are which be to Ryan Sprout discussing President, Earnings be and closed market We'll after our in Preto; released the XXXX Barretto. an issued investor website. you, on the Sprout also me results Del press CEO, announced Social's

expect, pursuant relied statements identified contain to the plan, subsequent at representing fact will statements plans statements our to include, forward-looking views statements our any and objectives These by provisions Reform intend, undertake any are made opportunity among of looking. will. These and safe as call of business update concerning only upon we date, the be today and duty Today's these and expected Private such words should Act statements which statements. harbor of anticipate, or be not other as as historical reflect do seek, Litigation financial Securities future not forward and others, believe, XXXX. views are All can our than performance of

to subject cause and Forward-looking matters that to differ statements address are uncertainties could results that risks actual materially.

of with XXXX, XX, as that we annual on December reports Form report February important discussion the factors the results, our to year as SEC. that on the ended well other a risks and future XX, actual XX-K For refer could file affect any please our filed fiscal XXXX, for

these is financial to in accordance press and release, financial on measures, principles. measures, non-GAAP along website at earnings been directly to are in has quarter with Definitions GAAP available the first call, measures comparable most prepared furnished accounting reconciliations investors.sproutsocial.com. we'll financial are our not the discuss which During SEC with generally the accepted non-GAAP included our of which

turn the Justyn. call let over to that, with me And

Justyn?

thank by to to us. to We him. and today appreciate I'm to you Jason, your on things before CEO everyone promote to Barretto joining over expanding news always Thank you, started excited time. our us handing for get Ryan

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you But want congratulations Ryan. say to thank and first, to I

as leading ever I a member shareholder, and incredible as excited us team I've you this with member, been founder, team. in about Board As am front the of opportunity

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driving an for We known success. to going culture value outsized for bar the team be and the the customers software, of advantages. all focused award-winning raising We competitive most have these shareholders to deliver in along drive in excellence to do the and we #X customer on way. deeply our on intend I'm employees, and product well everything

to lead to front Our the from can here. as work team deliver expect me we

planning. new recognition heavy, a creating enterprise versus half of QX different on which revenue into with weighted our We're After ultimately of didn't walked meet many results. has goals. deeply business. where we a deals focus XXXX, our our our We back record XXXX now a quarter pipeline, the materially the was with linearity business start changed and dimensions, of strong had Let's revenue but closing majority and on affects

our mid-market and our of years our in buying this, QX, the enterprise enterprise accelerating the changing important and We vertical heavily decisions are and heading made customer-facing and more dynamics into prioritizing coverage execution building moves our to headwinds for future, positions of changes traditional long-term teams adjusting each manage term, in and We better cycles. support new for we such thought quarters self-induced. underestimated without believe could now our we quickly teams, magnitude set strategy that customer were months, of weighted us top the Our the shift were mix. On these collectively strategic as several but all promotions they sales in there but account the of model disruption, short enablement teams. Tagger us these back. I

progress to much QX there better was Although own and important expected momentum less year it lot added going where of revenue was us fully I out forward. to QX this new net of we be of last this learning, than process. coming expect be, not and a and

scalable order Our go-to-market growth. positioned is now for better

year. Shifting redraw path and Premium the attach new of Coming parts out, rates to go-to-market over XXXX, optimize business growth overperforming to on watermark clarity is revenue. another is accelerate step efforts low platform annual rapidly unproductive XX% folding Entering each to our teams cycled for low be of with sequential year-over-year. into meaningfully Our will our where deprioritizing added our largely our important very new our and that gross growth XXXX, [indiscernible]. in billion and we the our increase, business. continue end strong planned, and in we ARR the an to CAGR $X and increased have accelerated module took strategic into to with total our ARR strategy. pipeline Sprout QX we retention seamlessly strong And expect positioning performance. that

that growth efficiency, We our best this go-to-market benefits around materialize customer not our believe both believe a is we most powerful know unlock that for and the model will potential, massive our we acquire. the most cohorts is efficient future to to redrawing are While our a overnight. our customers cohorts successful unlock

expansion efficient least of and most the opportunities, cancel each are the by likely to are They magnitude. they orders

of time, time, de-invest benefits parts of can beginning and attributes scale We in NDR we these efficient economic the immediate market where We're efficiency we will and by predict land be organization. don't results across durable, can changes with the will the gross we invest where with this the and being even from in surgical improved higher we believe improved our a to will plan motion. We that market walking cohorts cohorts where prioritizing the aggressively QX ahead to And realize the XXXX believe here. nicely retention our allocate expand revenue. future entire efficiency. At already plan exist, from potential, the get to if upmarket model against away results we economic future same these

compounding with know, all performance does the year models, we our through flow revenue a SaaS As QX perspective. from

pressure inbound we be execute at highly to are from on metrics way model, to QX create business Because go-to-market ensure aligned flowing this business downward is time underlying changes, our the the up to of commitments. The from our customer I current on With of we forecast IPO. now our tighten and as Once completely products linearity the measured enterprise-heavy our orders knew needed constructed magnitude properly at deliver different this, the a that today with of need changing on we're realities the state. you the that business our space we should from of success. different revenue to and through, transactional

trajectory I CEO should that of RPO a As mind. CRPO ARR trends more We to you forward indicators I we performance metrics role, want growth told our to similar transition like for growth, and into that move with have business. are the in ensure revenue while appropriate this

point a single the peer of indicator large With compensated consistent our on approach are be our enterprise including not a measure is set, total a is direct team years SaaS customers. measured been sharing total such, key count on an count. logo priority, total or our than now We're sales ARR As or more a in we'll customer not with being enterprise where consistently performance no disclosing for success smaller our longer is business. don't of in we these enterprise our that at customer go-forward X metrics. logos companies And current basis, hundreds competitors. We've worth that

and we'll the transparency, total customer had count. such, logo no disclosed be As gold members previously disclosing our with contributions from channel. partner we Further, longer

distraction point. helpful more recognize we that than this data a served However, actually a as is of

practice. idea partner contributions our is from won't continuing unfounded. be we that comes So all of The that temporal growth

XXXX revenue roughly and the strong slightly XXXX. and our So a everyone contribution XXXX our a both understanding same may other especially within I in to believe that creating partners, partnership new assumed. we XXXX, less clarity future we for ecosystem. revenue, headwind a which accounted X% all business given Salesforce of in to than are growth growth, including ensure XX% social total in powers for and potential have into We amounts and is through the value previously opportunity more with our data. Salesforce our than less X% has opportunities less actual key partner want studio I many This and nonsocial the business see significantly studio that to

the XX% about on we excited and I'm We're see and us, business the the of market, change driving front aligning to in that and you innovation our of large ongoing deliver can our fastest-growing in opportunity in tremendous our best CRPO. a and growth, goals. and which ACV customer XX% growth growth RPO with have We are cohorts rapid ourselves

both business, delivering social. We defines momentum a as new see operationalize and excited accelerating multiyear I'm founder's of can to over Sprout efficiency expect world-class time accelerating every to our bring life vision in improving as businesses our over customers original build leadership, we're Justyn how expansion product period of going for on our day. to and culture history we

it And to Joe. with turn Joe? that, I'll over

Subscription million, Revenue XX% representing I'll $XX.X up XXX% Ryan. quarter Services and million, was was results XX% financial $XX.X revenue guidance. fourth million, our now up revenue year-over-year. through $X.X [ for year-over-year. ] Thanks, was growth. run year-over-year the

impact the year ago. our $XX,XXX XX% in underperformed contributing underestimating growth ARR The of top customers QX, quartile deliver Ryan growth more SaaS. Despite number outlined in changes more the plan ARR continue from grew we year of in than ago. XX% Ryan approximated earlier, $XX,XXX a in subscription the The than strategic number of reasons customers for from a outlined. revenue contributing growth ARR grew which to

half the the from We early model have with customer back compared with XXXX, benefits losses our consistent of net fewer materially changes.

$XX,XXX, of percentage think ARR about with think of and continue customer even a year-over-year. improving to growth about the XXXX. up QX prior QX should compared was you throughout base should XX% smaller full year rate You of the total ACV be as periods,

and or expenses module grew As our gross continue and QX, Through year care. In $XX.X from new influencer XX% marketing XX.X% my margin a full non-GAAP mix, profit the of a for over shifting XX% up million, non-GAAP sales Non-GAAP term. expect $XX.X quarter again was rates, customer new pricing, basis medium to we XX year revenue, ago. digits points of a were of marketing representing ACV million QX first from ACV we ago. gross down strong year-over-year, premium business enterprise strengthening rapidly growth business double lapped and attach

in to continue We our hire enterprise organizations. and growth aggressively sales

base customer and have enterprise X sales resulted for software. expenses, $X.X and changed in amortization into to an future This peers in we in commission shift away marketing consistent we benefit a with operating our and As enterprise, million from from X reduction all The accounting expect and income in SMB is has our periods. change accounting years years. QX our deferred

year This expenses has no XX% of or and flow non-GAAP and ago. our QX flow, to correlated cash roughly be will that revenue, $XX.X development accounting margins change margins Non-GAAP likely research on it flat are a and moving impact million cash increasingly non-GAAP were forward. operating free for from mean

investments and care and our in invest strong in targeted are to continue and AI returns. delivering ] our [ customer castable social We future

were Non-GAAP from expenses a XX% of XX% down general administrative million and year for revenue, $XX.X ago. or QX

$X.XX as forward. based net share revenue to deliver for non-GAAP XX.X income stock X.X% and share, average percent income of on consistent $X.X expect We non-GAAP compared margin. Non-GAAP per operating G&A million non-GAAP for of million net net income was Non-GAAP to for per ago. common for million weighted QX a $X.X a $X.XX year $X.X income a was QX leverage outstanding of operating of moving million

was at $XX.X quarter ended securities. QX up revenue the end equivalents RPO Turning $XX.X and to at cash year-over-year. unbilled the flow sheet in QX our $XX.X balance QX. is of marketable statement. and cash, down $XXX.X cash contracts, of from looking up from million, both at million, end and We million with $XXX.X billed This and million the million Deferred totaled exiting the XX%

to growth the recognize CRPO as over next expect a We of XX year-over-year. $XXX.X XX% or RPO of months, XX% implying revenue million rate total

up indicators converging a We ago. a up million, million Non-GAAP $XX.X time. free CRPO believe ago. year was record towards cash continue million from to $X.X leading our a that over $XX.X year Operating million, from flow was are QX all a in flow cash $X.X record

Shifting guidance. to formal

more million we second revenue XXXX, rate quarter the the For of fiscal range of than or $XX.X growth in to million expect of XX%. $XX.X

deferred range the estimated X.X% to accounting million. change. expect We million of non-GAAP $X.X the includes margin an non-GAAP benefit are operating of and in income of These at operating our $X.X commission midpoint

common assumes $X.XX net XX.X between non-GAAP average basic a outstanding. expect share We income stock per million weighted and $X.XX. of shares This

the of we growth the For of year the outlined. each and total subscription full assumes changes million. reducing growth $XXX.X incorporates Sprout Tagger organic are and XX% XXXX, This greater to revenue range $XXX.X Million Ryan revenue accelerated than to revenue a

XXX margin year the to For roughly $XX million income raising This are million. the of improvement operating full annual to $XX we of non-GAAP non-GAAP operating XXXX, divides basis points. range

non-GAAP non-GAAP implies accounting the points. of are year-over-year prior now margin Excluding change, reiterating guidance, we basis improvement XXX our operating which operating income

$X.XX, position average our basic of XX.X growth. between net assuming model income increasingly deliver transformed us and share million We durable $X.XX believe increasingly stock business outstanding. shares We efficient common and we've to of non-GAAP expect to per weighted

take With and that, I Operator? Justyn, of questions. to are any happy your

[Operator Instructions] Raimo comes question with the Your first Lenschow line of from Barclays.

of you And had prepared X to kind settle speak can And most question first about that about see to you bit like X software, if X maybe X a like of changes, compared there? for me to follow-up. organization, historically, how specifically then little Ryan, what you changes did down takes remarks, I you like your valid? or . is usually more kind like quarter is quarters that go-to-market if X think you to the the think go-to-market

of things mean, say, through organization. for of I going the kind the of about way we we're would lot Yes. We Thanks, a I Raimo. as those QX. made -- a into things important If market strategically really most did today. heading I where that of some shifts think Yes, those we're

sales in are that things like in team. into investments we we account the a that about doing enablement as coverage the think you vertical If implemented the

factored So the well the changes team ramped. both of our through and of revenue the things think all year of about impact QX. through the getting rest through the been making the QX as guidance those compounding When playing that they've the in all we're as through we're we subscription

And think So factored QX, in they've good it going felt into we been of we're been all really team has in feel I where at. a here. portion with QX and good is our as

is ARR, I judge you for I since judge like away business? we progress since okay, Or of in wait of And here? all is handholding would the maybe QX. to ARR do how Yes. you how of it's And now Joe, kind took do the of for any us trough of Like the give think you? kind like kind then like just the there to with you need -- of kind And need to outcomes? said probably like, want you, you

Yes. start on one. I'll that

I going of customer the of in material our the our has business rationale composition really think been linearity the base back and just to here, changing ways.

As revenue upmarket peers. with consistent loaded, back-end transformation and as RPO we business, indicators we've going been and this more becoming that's the for our our view and best through

going complicated noisy all to and We measure way accurate believe our this to a that less less for be the you, also of and is most business.

of you this is a business is where some the the highlight to and added revenue good lagging that I'd in tonight. change, to we've going So a RPO that you we work the all of the indication are leading going. And sort as indicators realize of give

are will our so level you support your in as make providing that the dial sure right we of team And models.

Bhatia with Arjun from William next question the your of Blair. line And comes

think big about that I full variability operational hasn't year it some number last changes here. I guidance of And really the more over least cushion that years, took an Maybe much strategic on the it now like seems the to for But there historically, Joe, a in guidance. room cut start the or and been think there's for the from And business. coming at in maybe are if pretty we to obviously, couple perspective. just

so can and work yourself the And guidance these course left walk as over of of changes you how just what you much some into baking you've maybe you're cushion us through XXXX? through the

Yes.

there. So things covered, is baked in Ryan of the of that I'll this some kind Arjun, are and but reiterate

that how of flow First of changes kind momentum. still guidance feel QX, changes of in all that those good of we're making that and the go-to-market the the kind about baked kind indicated, we Ryan but into are will really

fact the The then how revenue, our business weighted. becoming on flow-through flows the that the that and here other kind definitely QX of that soft we QX, QX thing we've revenue is in And factored more through. is had

And to confidence we're putting a have like half felt give at we year down full an so the us back and year, the away wanted the take thus half a of weight level we when high changes back to opportunity XXXX. more these that through level a to execute and we revenue to look successful of in of

then, you from it. that in details, for missed that mentioned Okay. but it prepared long some fit the if term. And might you, have immediate -- walk I Ryan, was strategic away revenue Got wasn't remarks, there you the you right is may and it for mentioned something your you

talking that go-to-market customer different you're complexity the maybe what that to your it ideal deprioritizing? flesh or last add the more we've that you reallocate Can that that And try is about into for much profile help you? as transition Is us? does from how to resources over motion been year out so? What you just for the

year our of the identifying our the going step I place so had and the to opportunity it customer part live both of motions, and that, were lot felt we changes outbound investment. it composition customers making for be really profile sophisticated of base. And where a transforming ideal well our to our to getting Yes. maximize one last was most and where greatest current of as through like Thanks that base matched customers the customer mean we question. a the able perfectly really as the opportunity new next where the we our and is biggest our inbound customer

some opportunities our again and our we've and as so looked think marketing we we we and the where the in outbound as and our mid-market as time amazing take really for healthy inbound. some of to data really upmarket about we've base put inbound our the opportunities which all and invest at that the well teams when at cohorts prospecting identified exciting really looked motions we enterprise customer of us where majority our about actions customers, And drive to think of efforts

pockets know we hard higher a has was like commentary just because that opportunity identified compared and opportunity overall longer. that rates so land the it go these really And that of just that they want churn with it the CAC as to cohorts to they different some stay we've metrics bigger, we don't of at faster, convert

got So on a we've the that in data more our business. we've really comment team just it with got focusing areas was of on surgical that some our on these

next your the of Hynes with comes Canaccord question And Genuity. line DJ from

the the Sprout was a if to extrapolate more enterprise? ask I specifically I'd to cycles. Is softness, of right, sales I to just budget love with But had quick on cycles, push hear your seeing? changing you tied it mean function pipeline of always short Maybe Ryan, has less you What talk what sounds I'd that really be goal, weighting. QX, are sales you're it more sales curious QX now bit that's and mean second 'XX. I about seeing? about cycles. right, close from rates generation like in little half and a on cycles. about that shots like of kind comments kind to of QX interpret

seeing for we lengthening larger the composition the expansion. of These they they customer and you're base mean, DJ. Yes, Thanks lands of cycles and larger are are opportunities for Yes. as are sales our larger opportunities, changing. base question, the I have prospect the right. is definitely

it so changing. And is

still see we customers a our feel leverage great more But get effort because to we're before, see the we ever also really the ourselves which that business. we in value great like product is a thing we an a in quickly to Sprout realize today in RFPs than positive and position for did is -- more fit. We've

If been last quarters about American even P&G great talking you likes look for much large the much that we've bigger examples over land some few at quarter, and opportunities and of logos and and of this that expansion us Honda, Pictures the the have companies of Universal bigger later.

So I would say business which that the commentary lengthening dynamic of the a our of of where the in lot cycle the to nature is is around business, back-loaded a our ties transforming.

Yes.

Okay. Any maybe us, love chatter from remind a, regulatory can the as that that today? to And away are material were what be U.S.? TikTok thinking And surrounding a in I'd would go that's standpoint follow-up, helpful. industry then hearing, standpoint b, revenue if a you business how TikTok, with a there the all would then is up how from to about just like, you're pick folks comments any to Like happen this? happening

Yes.

think biggest to specifically highlight don't we the is on network. monetize of really thing any here I the

customer So they against. think if about these of And that about way execute all it they they to social got need holistically. you they've strategy, think about different channels the as just our think that

But a partner of great we really where customer about by alongside us. they that's actually they We're this for products networks community obviously of And been typically them. we've built lean customers, so at base the and at where much and have is, the multiple leveraging. their TikTok that look our they're in. dictated is when time, same excited is their

will traffic goes, And social here heavier perspective the will some their where and other where leaning time. end they mean brand so they up where any a from happen that that changes go just network customers spend in

that we a ton so and sure the for the importance value that have of social And making of that part our products work we of of do a excellent all networks. is us, across add the huge that's partnerships

ecosystem add I'll is Justyn. this the on commentary. And thoughts

partnership here feel there's I stage, a around consumers form this brands at sentiment what -- talked lot and then their It's same not that this a kind customers. broadly, are inevitable and for shift they'll unavailable, happens, that just I ways, think an then characteristic but just What's think and shifting been not for that with That's of kind of sticky TikTok the sort contemplating of point. And I a to we lot about going time the big is and don't at we powerful the TikTok. there. and disruption in there's brands short else something effort something energy see that content. with way in a should while, is that video to become think value unproduced happen about of and very platform that is footprint. And from

is others. Reel one There's example.

the of part it of that social is the of that. But So of of regardless it's and is content landscape the a something be the building part of a network that's where provides. is. itself strategy and of spot in strategy that as the the market part based ecosystem, the this It's to type part engagement it going social on type of the content carrier

comes the of with Lane question from next Parker Stifel. Your line

just earlier. on double maybe one Ryan, to down

is be any sales you go-to-market risk guidance here peak tight that XQ? behind execution disruption going of the You of in additional confident in When look sales place in here not before us that the referenced it year, range, XQ. your the lot level really a to in and it's changes took start QX, we still how happen at of but that lingering are there's

about all to going the for -- this decisions it QX. And just in question, made on of way and sorry, happened for decisions Parker. we've the feel built of and were out the happened execution of Yes. QX rest guide, we year. And the the in in Thanks to the good and those QX guide changes the that clarify, QX the of implementation

that the within actions and take doing we needed the to changes that sales quarter. some happened with the of enablement place were majority the and the The teams of

the being good and feel that, we all about contemplated that's within guide. So

the This coverage, about is type time in about take it's couple around also to this. take and I might like to that account talking go-to-market where decisions changes This spending quarters some hold. of pretty We're a tactical helpful with of think a lower things that. about. than [indiscernible] team layer a in change on talking strategy we're that Tagger enablement context just talk the big here,

spent want So Most different clear us. momentum not I energy enablement, some time to talking kind change, strategic But that large that fairly a the a headwind thing, that, going to tactical radical for in done, is just the things of calorie a things finite. and of that's make it, of change that something while sure going these or or rather after about are created market like and some than binary the QX or we're part stutter cetera, a from like to take it's out. play et a some that's perspective,

appreciate feedback. then I it. that Ryan, more. one And Got

You talked signals here? beyond XX,XXX, are cohorts? best aligning that depth is still your should of From going are a that XX,XXX that Or customer the emphasized XX,XXX to a mean to that your be so providing level go-to-market cohorts. around lot there customers about perspective, our interpret we right under

that But -- is jump so There's sorry, time in this project I'll a of lot Yes. is on, this a here. I Justyn. spent

very about talk customer I next beyond taking we of when think the base. past the step end that that moving low

base things et is better which social so cetera. assuming different are look going than to the And rather There's different any a whole the got BXC, that's approaches economics, similarly, of allows et behaves there's customer that that healthier given is next cetera, unit much customer us performed there, of a like types, similarly, to across okay, say, rest at that, that there now kind layer versus now based we've clearer have able get a enterprise. that recognize to patterns social, BXB to -- variance being industry footprint, in much different different let's segment, on

dramatic a at than brush, under a XX,XXX, early rather at there these growth with even to opportunities similarly companies have broad look let's that where categorize even the Companies sized difference other different XX,XXX in, further size potential very, -- XX,XXX painting we're in and bucket. able -- with it, some if we profile there's where are very call a look to

we potential customers of about groups to out dialed behavior calories, where the our with those on time. spending and in that very, talk different and Within that's and differently should how that market background different we where and some different we our spending of be really we'll how points. groups should is we've show differently very group of the how Thinking and those a figure up those powerful unlock, be kind

Your comes next Adam line of with Goldman the Hotchkiss question from Sachs.

performance that and that direct despite start, guess of productivity how I more through get it there Is is thought reaccelerate can in channels it'd you RFPs record morale to Or your anything we to productivity ramp sales you just mentioned? the before a you of ACV? Great. useful. say fair Just partner has the just think the sales about or below sales force direct your quarter? be to should would was around where be

Yes.

of some part within changing some ramp into latter said full as of QX, QX you we is what actually see go is the and and to this the it we of for some at -- rules we It's ramp then happening forward. your play just folks and that hires here going into new comment. had is natural coming think I expect

there really of and distribution good good half the we well that a the back From the year and about channel saw we perspective, created. partnerships and partnership relative strength have as feel

more more these think of and our model are are focused just playing in more team I our today market. that out natural So is business all things up is

now Okay. we're based bit that exiting the that That's target. your And then XX% a And going on about year. or to prior I'd I going think curious helpful. you be XX% guidance below CAGR. gave, like guidance know revenue long-term billion be a implied you -- the guidance, this that something $X little be how really to just we're that

outlook Are get the today? to this in year? how past stick we about growth think you continuing end should reaccelerating And confidence your with of once that we

small that Sprout insight through this about The when is impact And really and number. billion a to set to and have here QX relatively is focus. much in the target. $X to our small. very to up still number accelerate isolation you It's in think relatively intention relative We Yes.

billion about us. is the And so the finish but next for target certainly line $X milestone, that think we not

will get that just work lines the of Justin our much fast touched so we perspective time even And and just can how actually there. impact a go-to-market on from

So we I'd share future on in And back to this to come definitely as now. right say data no share changes more have quarters, we'll you and that.

line Oliver question the next comes with from Baird Rob Your of

changing is just move base, the part didn't dynamics prepared if I -- get the I to reference Ryan, you I enterprise. it reference correct. Great. Yes. in remarks, your said to customer in And the just quickly assume you made in that paraphrasing exactly think

for you customers anything then one But else the -- is of to telegraphed upmarket know year of that's kind of because from the there you beginning sort guys and well you last year. the lower when if sort I referenced of out through of clearly, wanted got end the as move there's been end of being

dynamics in our call So to just addition that something you and are out? wanted curious what you getting those meant customers hey, by there's to bigger just,

larger, And sales in [indiscernible] have Rob. that that. about the our Yes. have business. And think in a of that highly different of lot a is you small of, models SMB business cycle. transformed, was knew Thanks, about that really front customers It's -- we're we very the transactional opportunity business think it's IPO if us, at front and the type the customers when changed, with that of inbound it, way our more have today, it's we dynamics that these capacity the lot sophisticated customer really the changed. staffing in that from way We we

been a of really we've on was that going through. comment it business changing and more So the that the dynamics

Great.

and or on then referenced remember it I Okay. that, sales That's in there, indicate helpful. to you one the Salesforce. think And I we're seeking I Joe, was think, not that hey, just can't if were dependent you And other, force 'XX. contribution

from of into end coming to around you the surprising down me because think momentum integration. the said the native Plus service, year-over-year customer Salesforce which with was was 'XX, I However, guys it life of Studio Social

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line Piper Your Jeffries with the comes from of next question Clarke Sandler.

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we a the assumption I think into move that's enterprise up as fair business.

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Your line of Oppenheimer. next Schwartz question comes with Brian from the

you on somewhat or all had in the last the and the lots that? wondering like deteriorated you macro just was since Can feel because about that had reported a same tough just with for had transparency Do Ryan, now you first upon all pretty talked deteriorated you QX it's while And on the if quarter? at macro. the it been business. touch bit changed what's feel I little going of a at

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seasonality us expect should for for Joe. expectations for CRPO of But in you that this year? and CRPO can your question on we terms then share RPO. And what The growth for color follow-up my the

Yes.

could those QX that you low way the look QX given should to expect at as of we to watermark increase watermark just business. curve high of those like still in the our kind and metrics, you see part being the with steady continue So year of the the year the be throughout and the way

then So QX. in watermark low watermark and high in QX

closing now over our remarks. conference Justyn turn That concludes I Howard session. the will for Q&A back to

about things tonight. to No a busy quick. talk Thank this one's the appreciate keep some of schedule you. in right. we're opportunity to But got what's I'll about. All really that the you the going on business, excited

something we've years us have in need making the motion, the adjustments strategy a and front top to that X we got we excitement have, foundation the of of on that that kind or QX, to The of that I all of X to it that we've you Ryan opportunity can to that that is with that expectations think energy the of built able has ago. plans that been feels deliver in in I incredibly we've jamming [ be energized. ] make us feels contrary the in backdrop and way changes something to

us more chance some appreciate that out folks year. on of to several the over bit later see You'll from weeks. with check play the across the next a I your

appreciate time with forward up all you to catching I So soon. your and look

all gentlemen, for concludes call. Ladies joining. that today's you Thank and

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