Sumo Logic (SUMO) 3 Jun 212022 Q1 Earnings call transcript

Greetings, and welcome to the Sumo Logic First Quarter Fiscal 2022 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to your host, Paul Thomas.

begin. may You

afternoon fiscal Good Thomas, to Logic's Sumo Logic's Thank earnings and conference quarter Relations. Investor XXXX President Paul call. first Vice you. of welcome I Sumo am

Carey, are on me President and the today Chief Joining Ramin Officer. Financial call and Sayar, CEO; Sydney

by today prepared followed format session. Ramin and remarks Our question-and-answer by will Sydney, include a

Form our this Sumo does will except call, assumes the of expected law. efforts, be and filings of XX-K XX-Q filed of with risks our recent regarding guidance, A may the including from the risk statements our statements, our factors and uncertainties by filed report call. on is contain will strategy, forward-looking DFLabs and pandemic, our regarding and our and are expected update and subsequent not made our discussions prospects. differ Securities Sensu; no Some business materially expectations our COVID-XX future to risks benefits obligation or to this to business, and on impact will results the platform that questions statements that expected expectations These the the factors responses Logic performance including the the intend risk acquisitions Commission, Form to comment discussion Actual your on statements. the solutions, of overall results of in Exchange annual with forward-looking in subject our to our statements relating and and most related be impact included future contained forward-looking as and financial to of uncertainties. go-to-market required

SEC regarding a should addition not These will and including filed be Investor furnished to today discussion on Information was in in our the reconciliation our measures Form today financial at earnings as measures. or considered on investor.sumologic.com. non-GAAP financial X-K our in financial for from results, results. include GAAP isolation may to be results, Relations GAAP found website our non-GAAP release, with of and Our non-GAAP historical substitute a our which non-GAAP our

reconciliation on guidance, GAAP a as posted detail forward-looking earnings to With measure the our that, Ramin. Investor release available over me website. financial in Relations certain turn discussed guidance For the our the in of is corresponding let to not call non-GAAP

our Thanks, everyone, today for earnings joining us quarter on call. first

start year strong driven from Intelligence by Continuous our demand global customers Our enterprise our off to for Sumo is a mid-market and Logic's a platform.

to our into are topics. our by transformation of learning. we by results of quarter further we stages to with analytics the increase more see to confidence signs With well to give to billion-plus increase some powered and to and we to machine more this both I stabilization each these market, and migration. normal investments and activity and continue security that capture like in from the in are a with early recovery on pre-pandemic grow our positioned investments highlights to of platform observability opportunity the we capabilities digital would us our return cloud start created as $XX then detail Our Combined go routes and and continue market stabilization, expand demand.

both performance, robust strong delivered customers. multiple we at top of enterprise range, seven-figure platform. differentiated by mid-market revenue saw Continuous guidance our ACV We and the First, for end driven Intelligence demand from our deals

EMEA customers We and theaters. and improvement cloud-first Fortune the Total customer continued Pacific customers customers last eight companies Global added XXX that customers Asia innovative $XXX,XXX-plus and across quarters. metrics. in added Second, we $X to the span of the we SMB million-plus saw most increased, U.S.,

visionary industry attacks chain Cloud and capabilities SIEM well continue an and for customers concern, expand our to breaches and to gain as our increasing cybersecurity be supply solution. as as Third, continue analyst we recognition

or such, our continue threat Security providers. reduce Orchestration, enhance for cloud our expand and offering will help investigations and closing DFLabs Cloud Response, further with joint analysis, the capabilities operations solution accelerate teams. tasks we further and analysts Automation manual service SIEM and and detection incident to and Together, for managed our As response security SOAR to security of hybrid customers forensic

technology, Next, why companies we further a we is Sensu, More monitoring. forces, specifically, of our product strategy one the extended top our suite DevOps. and is great for their team, has and organizations in help being DevOps tools and in to strengthened large announcement large open-source X,XXX active observability of active our the community and OSS all intent Sensu over acquire leader globally code a open-source of which easy-to-use existing is with accelerate leveraged and sizes. by community to grow will used joining monitoring by the open-source and observability a its

sizes accounts. grow designed market our a continue manage to routes our into Finally, Hat AWS, with both powered an that and created help and we signed Logic joint more we partnership and our protection. threat as our allows platform, us with we to to both and deploy continuous maturity be is and on had alignment software and strategic Sumo's our security align of security Red security AWS further to more pulling together from security We integrated on expansion includes IBM Fortune observability modernize XXX running transform solution security for as quarter. and Building security modern strategies. listed OpenShift, hybrid organizations to partnerships important fruitful intelligence address support purchase, a of important further the relationship sizes well expand hybrid customers XXXX challenges. Marketplace, out-of-the-box confidence and significant agreement believe IBM's announced for integration enable opportunity operations. Together, of increasingly the organizations with built key Global This have unique to and of for which focus to Hat Red on require partnership have security and OpenShift is our initiative order Similarly, ties during an their to of long in of strategy strategic all gives support choice, new their a to ecosystem between Logic services even strategy and and which solution, launched to we we multi-cloud recently help deeply by and on Sumo and Sumo joint companies This customers, AWS multi-cloud and partners the top in well us joint launched and a AWS observability IBM easily AWS. is with all as SIEM

revenue this year-over-year. XX% a driven our strong million, total saw improvement growth up quarter in Now customer with of let's $XX.X turn to performance revenue. We Revenue was continued revenue base. by

four-quarter XX% X the And above $XXX,XXX had This ads continue our quarter's accelerating year-over-year more $X the in gross we customer years. best revenue adds or recurring XXX, million-plus than average. be generate who to quarter ARR growth. to Customers in customer to ARR annualized robust, last trailing increased of

of like Now exciting I'd examples wins. customer a share new these to few

in to Cloud we replace signed cloud a X-figure architecture. scale modern or new deal their too our critical cumbersome manage, important expensive legacy quarter, CSE. company to life The become solution This logo with solution supporting and lacked had capabilities to SIEM large Enterprise with legacy SIEM a insurance

automatic one, win enterprise to alert that and demonstrates to fatigue. because the quick CSE their threat enable large migrate helps digital hunting transformation its customers support This value, features want time Our solution, ability our like of reduce and rapidly to to that scalability cloud.

solution observability to Another with they resources internal to legacy and resources. deploy software customer than to Kubernetes-based service able needed open focus in on time built stack Sumo architecture, easy-to-use provided on and in a modernizing was of enterprise cumbersome on amount They had The customer-facing of a With and source. a a to legacy time functionality Sumo, software support source legacy their to X-figure the developing company. significant but were rather company its this planning their the quarter so take top going maintaining and solution. land was was a platform. doing XXX Fortune product enterprise quick Global open their platform modernize

we continue expand we lands, recently a significant Fortune the new enterprise our year, at XX to large In a land addition won. we last announced customer. In have XQ of to customers X-figure

we at subsidiary and the global an we're surface expanded large opportunity international relationship still to beginning this scratch of adding the This just quarter, by customer. that

as We internationally continue drive to add new to well. logos and upgrades increase and adoption usage

This tech quarter, financial delivered new including region X-figure APAC company. global performance, our logo robust a an Asia-based land at

million addition, In in X-figure region. we with had that a upgrade a $X customer

mid-market a segment. in We also our compelling had quarter

an signed observability we matches needs. Flexibility seasonality COVID. expansion surge see business elevated a has that business their they a as this is seen quarter, key with in and e-commerce customer to shipping solution customer an of X-figure their during business This needed that

and fit initial now customer. excellent $X they an from XXx over over for their expansion in was million credit Our this expansion, model ARR With are this land.

microservices tracing past, us customers our Customers and or based able APM of advantage features. XXX% a User ensure past able access our been architecture As distributed multiple have Kubernetes access and moved allows and cloud Similarly, through for production that to had while their to for and further packaged to we ways. customer have or by cloud-native for in highlighted Real their adopt prospects unlimited gain applications. workloads our Kubernetes-based ingest for intelligence. in new early allowing variety to continuous observability. solution by comprehensive observability to migration easily innovative This capabilities RUM are our our and AWS packaging their we volume licensing and existing Take differentiate quarter, leveraging into example collaboration the for large increased Monitoring accelerate a to efforts users more

to out-of-the-box site Our as infrastructure developers importantly, with collection to and dashboards observability, and auto-telemetry more reliability as enable which and easily and auto-instrumentation application and easy-to-use pre-built comes alerting, solution end-to-end reliability. engineers and well gain quickly

and Sensu, and and will will mentioned our we solution. agreement existing the decision a DevOps source Sumo and reinforces definitive second monitoring-as-a-code signing application in portfolio observability solution I which expand is a open provide management. acquisition, developer leader strategic As a affordable, to an close extend and our end-to-end with of accelerate More with strengthen source with of This extensible strategy Sensu deeper Sumo's to acquire our community. and and a open-source customers Sensu XXXX, combining to is fiscal Logic provider drive quarter our for Observability further open also earlier, infrastructure commitment further which to suite. monitoring specifically, by to in observability made scalable engagement suite the expected

to differentiators. accounts. department organically In security continued ability of Sumo manage customers this to intelligence the for and that enhance us and This ease Organizations. enterprise announcement providers this large use, that on we across Sumo we the makes our key multiple customer and quarter solution addition, first with and/or build quarter, out multi-tenant recognize of security and monitor and operational functionality DevOps service managed enables multiple Customers deployments,

to enhance we continue We India and acquisition. Australia with and the also the later availability Japan solution our expand intelligence SIEM solutions expanded And closing to our and summer. further Cloud into expand this will DFLabs of security

market. which to made some further we drive exciting Finally, routes new help partnership announcements,

IBM the Hat previously solutions As we for partnership will Marketplace, our observability and mentioned, Hat listing the Red I our security companies where our Red new OpenShift on platform. cloud-native includes offer on running

from of and As extend OpenShift manage Kubernetes strategy deploy existing we clusters OpenShift its solution Hat's data to Hat our Red the helping multi-cloud. making support customers' it part model, easier operator integration, Kubernetes to to Red extended and OpenShift

hybrid threats. security address is transform a to AWS partnering we security as with by challenges new AWS jointly This protection. the cloud to and detect discussed, multi-cloud, force well deep hybrid security and third-party associated to types respond helps Sumo through tools. Logic long we and are cloud-native, powered threat direct learning significant previously and machine scalable the quickly across solution Logic environments solution This provide with history analytics, which by a through helps also ever-growing to as and of it with the security service SaaS has insights As SIEM collaboration and unified announced for of new and multi-cloud and visibility joint Cloud critical and agreement operators together The have Sumo the time adoption. offers multiple AWS. reduce Powered most on-premises sales selling been called launched, practitioners AWS

and We partnerships with continued and focus major continue described. or just our customers shift I see security as by a change to evidenced traction heightened new like in

you modernize place event for this along The customers and and professionals our of discussing our be is free financial invite expanded on Modern with event IT participate will new ecosystem cloud-native metrics, to looking at and Xth, the to latest we progress well. Summit and We a taking security compelling we security this product security. pleased with partners upcoming better portfolio, how Xth and summary, and with our to demonstrated performance, virtual June SOC understand education improving XXXX. operations are differentiated quarter in the We exciting customer as In partnerships. the the

off to giving a and us confidence levels. long-term for stability Sumo. of cloud is secular continued power year broadly, pre-pandemic a Our start, and activity demand seeing migration more Therefore, looking that more strong recovery are we to transformation the digital continue to tailwinds

stronger Our portfolio product are and investments with and well never has trends. go-to-market these been our secular aligned partnerships

more FY to QX back recover. to for details that, in As macroeconomic continues Sydney, our environment continued position we'll half have invest drive Financial the outlook such, pleasure of on this and continue the us now acceleration XXXX. year my provide results financial Chief to for and to our success growth our in it's Officer, as With

and a brief year our will outlook start today. of like first XXXX. everyone for the and financial Ramin summary I'd financial the Thanks joining our a highlights results provide the for brief I of for quarter. to overview quarter thanks call discuss fiscal with

First, mid-market international including and quarter, new business in the we saw robust segments.

our revenue Next, see to finally, in strong continue growth. we channel delivered excellent performance from contribution execution our operational and business. topline And investments

As drivers add to I'll of with Ramin additional are the quarter. some performance color we our performance. highlighted the earlier, this pleased

robust increased more our than by same as year-over-year business First, demand logo saw we doubled new new and over in the XX% period. more than business platform

had last quarters. business mid-market the American four best North in quarter Our its

over grew outstanding strength region. improvements by reflects we overall our The are in driven go-to-market Our our seeing performance year-over-year, business international in Asia-Pacific XXX% our business in functions.

This than the million-plus average in and number X quarter, best quarters. a a logo substantial last the adds we customers deal This both translated greater increase XXX,XXX of our saw new in transactions into of growth size. reacceleration and customer our eight in

by had over XXX QX, of The increase partners larger number year-over-year. average partners excellent deals In and through was we quarter. both channel again have an our total, channel In driven Our doubled than now business more size. deal channel the globally.

we growth. Additionally, to our to a as AWS the Marketplace contributor see continue strong

This transaction Marketplace than Xx volume by year-over-year. quarter, through AWS more grow saw we the

net retention. dollar-based our to Moving

continue decline each large to were that the there another have renewal our this case, we contracts downgrades of in we due a the these consolidation, million As discussed, we each. pressures. both previously Sumo significant In Sumo to expansion customer But users to consolidation. the one percentage in Sumo it of customer, acquired installed quarter did base quarter, $X slower the XXX%. In below had M&A be continued two with customers over see and Despite transactions due were budget points two to few consolidated. quarter, see of ARR also

customer While expect continue base, rate. volatility retention we strength our our to improving total to see we across see do in net

make larger Looking across to our customers are continue customer seeing to commitments platform. our and base, we longer

the size year-over-year, or expansion This driven by contracts. remaining and XX% of new RPO, and obligations, the our increased performance quarter, duration

length double a two year period. land average is years, approximately agreement from the now ago Our

our of we current this that over and can billings billings XX% Therefore, look $XXX.X Calculated best for fluctuate a reflects also trailing addition, XX-month our metric to of the duration year-over-year. customers. totaled quarter-to-quarter fundamentals measurement million, RPO up XX-month period the as year-over-year. at large timing XX-month In of a period the Recall period we from renewals our billings calculated XX% believe the trailing due business. increased

in the I'll more Now detail. review income statement

delivered non-GAAP increased in in of to posted quarter. $XX.X unless and GAAP financials compelling year-over-year. website. As on We Total the earnings noted, our our XX% is up first reminder performance all reconciliation non-GAAP. a revenue otherwise million, are A included metrics and to release

up million Sales efforts expense was The was decline period. more expense XX% ago from because travel marketing year's revenue the from development was or and by a XX% the revenue of $XX.X excluding of primarily by $X.X variability Recall gross digital year year-over-year. improve a with year quarter in of period. events. as differs percentage XX% customer online we in-person ago R&D quarter compared period. largest percentage and total, that QX, of reduced the break improvements our million events or revenue ago margin, year in associated increased compared expenses count compared we public $XX.X last driven improvements XX% costs gross million, expenses drove a percentage primarily sales our the First were compared revenue, customer, ago XX%, performance. of in expense revenue, and the to In G&A of up and and lower and $XX in out as revenue was of the of our significant XX% business. robust In discretionary our the our driven we driven in marketing favorable expense year as largest that saw lower of margin The of includes revenue, and rest and in spend decline million a XX% as General year-over-year. of saw administrative the with was performance head efficiency over to from strong and revenue period. XX% to a in AWS revenue and in year revenue reduced by to platform marketing revenue, XX% our improvements of operating was costs the company. The and last or Research program spend. operating seasonality

XXX loss XX%, ago period. in or operating diluted weighted million in was loss an per $XX.X quarter loss was from $XX.X year shares improving approximately an share, operating the million $X.XX Net operating Our based XX% of the or outstanding. million of on diluted average loss

flow. flow $XXX.X Free marketable in million of in X% negative and negative in was million revenue with balance $X negative and -ago period cash the securities. our the We XX% cash to period. to the quarter cash sheet year equivalents compared Turning and or ended

share current perspective our environment. to on Before moving on guidance, some I'll

quarter's stages gives confidence recovery. performance of us This are the early that in and stabilization we pre-pandemic

uncertainty geographies growing, transformation is the constraints. offset The we but budget there's near-term in digital and However, markets some some serve. of of tailwind still cases, in by

growth driving are this of made our this of our expect the will dollar-based innovation new we investments in and the second headwinds said, of continue year remainder this productive. becomes capacity marketing, and That net of as half last revenue sales the to year in in we half year, the product improved in through drive tailwinds We second confident retention. mix and volatility in

seen already confidence have We forward. productivity this going giving us improvements quarter,

We will extend broaden year security margins this growth. quarter will our continue our go-to-market on routes invest engine this our and platform. but to These I'll in and to drive long-term and observability our our year With that, to move impact market investments also innovation guidance. operating to second

revenue guidance costs will Sensu, but have Our and primarily both minimal our DFLabs includes in to increase impact R&D. which operating

year-over-year. rate excluding of approximately operating shares loss growth to $XX.X loss $XX.X million XX% revenue rate per loss to $XX.X $XX to Non-GAAP largest to weighted operating expect of XXX.X a of on For million XX% customer our This QX, or Non-GAAP we XX%. million. XX% XX% total $XX.X $X.XX, XX% or million million of an year-over-year, of average share million $XX.X to represents of of to revenue million outstanding. a growth

$XXX.X million $XXX.X XX%. to year-over-year. $XXX million, excluding largest year million growth to representing XX% XX% customer growth to of of total full revenue of rate a the a $XXX rate representing to Revenue For million, XX% XXXX, of fiscal our

success. to a new the mid-market or operating operating As $X.XX, growth summary, accelerate functions, approximately reach. We to stages per second of in invest outstanding. $XX.X positive in on a average to Non-GAAP continue in market are as activity, growth expect seeing and are plan we million million delivered and to is XX% the strong Non-GAAP loss shares With recovery to any expand loss of to levels happy we and the by well robust our believe, go-to-market with In share $XX.X to of that, revenue half of and momentum revenue more XX%. we Operator? We pre-pandemic your weighted to we an $X.XX international loss our to are our and Ramin of year. business capabilities platform believe we supported across early great of off positioned start $XXX.X stabilization I million questions. for year of segments. reminder, take

conducting [Operator with Instructions] At question-and-answer this Derrick we and question Company. Our proceed from a Wood is will Please time, be with first session. Cowen your question.

Andrew on frame What think have are It's on to that XXX%? to getting levers a this? on rev for about should you Great. quarter. Okay. back time Congrats over net over Derrick. do up you about how retention, pull we Sydney, feeling And there? what Thanks. strong

Yes.

we will four-quarter we move feel around. quarters average. going anticipate quarters net out. we last were XXX%, retention be We before is said quarter, As above to average. improvement revenue do see but to take in several our a it's expecting that start We to several the It to sustained four-quarter it get

last And from your half It year, versus to going. ramping they versus productivity maybe Great. Ramin vary any of commentary mid-market? ramp your productivity are enterprise then good, just does is like second sounds pretty that how And Sydney, expectations? either that but for around how how new on or hires

good quarter new business. We for had a

improvements, some XX% over but business new into that only translated productivity and sequentially. year-over-year, was not up Our year-over-year

business. that as out in good as come to of our mid-market remain seeing up saw continues well And we're productivity strong. APAC. We performance North America business So the just enterprise

Great. Thanks guys.

with from Please Hedberg your Matt Capital is RBC Our question question. with Markets. proceed next

have some Could driver? to to it talk that, show that really problem. with a I in be you of has a to Hey, think a of you. customers your see guys. that about starting your with all my aiding have big sort in lot -- threat pipeline? breaches as SIEM, noticeable. I'm Obviously, I pipeline. questions. wanted base, imagine increase prospects And is the data Ramin, up taking Thanks as Because for landscape that that curious, the about do with or to you how think I cloud maybe start -- to some

Matt. to your hear Good Hey, voice.

jointly an thing in like talked sizes. to about come security organizations capabilities able challenges, we've security our to a did really and why core there's partnership to the before, of the sector of think all need and of AWS us in hence, address all we the extend be lot to with I for to we announcement where unfortunate platform together

And so really in point, is partnership to and cost that store a all rate addition the your a persistent important much big we've the really leverages that back to innovations data and around end, SIEM more. lower and at done around Cloud

So integration question, and types important we're activity, But I think more is those do that of to the typically now, out also more in point longer bit to that in continuing a the partnerships, ecosystem enterprise you'll helping SIEM in drive it's deals to your your mid-market, hence are faster. or that Does question? those the either versus those answer transactional see replacement segment, for a sales little co-existence a cycles bit pipeline.

XX%, impressive. trailing even -- you so more then super And That's and super growth XX-month Yes. the Sydney, growth does. say of helpful. CRPO It

into the CRPO think You are improved XX.X%, in we're like looks that about should at the as to -- growth should the rolling talked this I progresses? we the it about half, at mean, is. the but me it growing growth think it about fast how of year year we when as as looking revenue total How midpoint second

Yes.

contracts. renewing in period about early did million. renewal, had larger and We going that CRPO see is when our of $X the to a RPO Our a we're we function also be

rate in billings the CRPO. in in in-period that the see as reflected growth as the You'll well

lumpiness we renew as that, when So of about early rates. those impact deals can growth think will larger those those

Got it. best. Thanks. All the

Matt. Thanks

is Sanjit Stanley. question next with Morgan question. your with proceed Singh from Please Our

take Ramin, of any rebounding across security encouraging or these IT three evenly question. the quickest, on get the Is of are business spread is taking I these for early of some wanted observability. that's your across you Sumo? it Thank trends particular ops, segment out the aspects how playing to and pretty there

Sanjit, hear good your to voice.

to customers patterns see But the then this, it been and that maturity were logging security on sophistication into as think good quarter signs a that was on where saw growing not trend. down for performance, highlighted but past we the terms try and as to that saw in continues of first to result, I those, then segment, packaging. it with lot similarities. A cloud to just the wins products of if licensing and -- think great starting we've we and new more the comes I call. some a We observability, mid-market we've migration this some the attach part are seeing. and of some capabilities be we on put and into extending the enterprise our also And some quarter our of

beta highlighted production out well we access that a new tracing one as using features example of for a distributed we and early customer So large deployment as rolled for APM.

segment, bit and with observability. and threat security extending observability and an landscape, generally, in respect think then starting to I stability little a more and attach issue therefore, So better And to enterprise seeing we're then seeing that we're with in business, the transactional the and for of logging.

lines a here. Ramin, of trying of signs. then it I'm makes think, understand the And I I'm when was to of and in because a I trend just ton Got it. the And guidance, sense. that think just the then some to construct script, full trying understand lot business, year I to try encouraging your map of And that

from like momentum perspective, for in new you're several the sounds some it a quarters. really really, business nice So first time seeing

where and gross expansion, and on that the business, terms about acceleration? two the stand in those business more As pieces expansion, remaining we friction where do three is is seeing churn of of churn the think other So we meaningful aspects? then between new

ACV side think And were up XX% Sanjit, year-over-year. business up the new was greater XXX% on Yeah. we I new I than mean, year-over-year. our of logo our business,

that lands to we've you $X ACV $XXX,XXX and upgrade segment. for the by a there that ads and much logo else? Sydney, and slowed something churn, mixed So been quarters the in go-forward terms as tends -- I net had signs upgrade new And with year, that both that's for do But new by a anything three theater quarters. and great of the logos and quarter. the there's little down. is less we're to to the want sorry, cross to seeing been add how historically we and million well bit two us about because new how the much customers we within propensity better think in or as indicator in upgrades saw downgrades talking hence, last we're adding then But been

that, into side, churn. say and just of I'd the our a was last dollar it seen quarters. of downgrade that we've when churn And Yeah. lowest actual break on look as we in churn, ARR XX one we the at the our percentage positive

seeing last we're from the quarters. standpoint that has over that really turnout four So improved actual

That's data good to much, on And congrats the point. so thank and year. a start the great you

Good your to voice. hear

Good to well. hearing you as

Mielczarek from your question. with is question next Our Kamil proceed William with Blair. Please

wins you Thank quarter. my everyone. on number this for taking question. the Congratulations seven-figure Hi, of large

much lean of opening and momentum So quarter, function driving or about improvements And of strong where go-to-market How the next up accelerate more now you this the over changes is detail year? is the strength? demand. motion? the versus second the of provide the you're into some consecutive this making what to are maintain you're economy even Can enterprise what seeing in

to good voice. Kamil, hear your

I quarters it's in selling what as reminder. model, pretty think that, a of in a direct couple last said a, we're we've So consistent with the

second this capacity improve been focused been and drive to and QX in build ramp and first productivity through through year, we've as that of terms coverage acceleration in on And out of half. half the has QX, so what to you the and start

as we about. So we're to talked plan, performing

international I from good with we as a indications had with we in think strong macro particularly quarter contribution to EMEA theaters, APJ. well. the And perspective, respect from a saw

on also we some well we fact think quarters. as saw few seen the good was best the in large-sized we've in That the commented a I probably there. that transactional mid-market, deals as

right? leading and prioritize cloud, it's security threat use and the starting they're consistent then channel And what deals announced comment we QX increasing, enterprises we a the migration that I use closed is, in strong broadly We and contribution, efforts. aggressively pretty think adding more and that I'll the the more that AWS are adding with and oftentimes moving had make we're observability they security. And then and from Large particularly the seeing. last QX with think we've landscape with seen are partnership. partnership happen starting observability. therefore, case solution with case in perspective, pretty I to around to afterwards,

what also seeing on We and more generally, has of in XXX% the in than a that up channel focus enterprise Red business, been security. Marketplace But we're lot announced partnership. Hat year-over-year. We're the the

majority year. that activities America, home a good at before workforce And so the last to everyone prioritizing are was And types North of or now for of normal people least those are other versus back at indications that, productivity tools.

actually the there. we're seeing seeing So activity, we're and the results

comments the That's some one to on like of international great follow-up color, the you Ramin. made I'd about business.

XX to they're that example. places year, you process said to acceleration some great you to the COVID, levels see you recently have I And that made the provide maybe the that, it's months how of to higher seen know think think markets I do enter can XX in about right I see what's on great existing investments ago, pandemic, you the rates? new called some and XXX% infection more remarks think months you It's out. these in this – that before especially the detail driven prepared you geographies? playing out the relative investments made up just But to year-over-year. for

Yes.

well and to countries In quarters. we've activity, I in where seen of quarters. terms have business, couple to you America. believe the of best theater business our And that a X everything a India, of as a that back to slower portion that's to community and been adds deals. Southern saw international. previous of over Shifting we involvement in But bit of North first the region large the strong, channel still necessarily in workforce, Nordics, seeing both in Benelux adds UK, a in some Shifting particular, that we last We're terms So well Enterprise good in of new good large over saw as as not across that a tends much in in that already terms the as EMEA area. came and little been concern despite look as with be of It had the couple in customers. be is that concentration of like. business country in but We about different strong concentrated activity, transactional I Dock that still. pre we've APAC commented upgrades also. quarter of on as as from EMEA at traction few terms continues QX, lot hadn't million-dollar going as there's A our North good the think the in in to lot from over levels. theater. a we America a well

thank for you Okay. taking question. again my and that’s great

question is with Mark Please proceed your next JPMorgan. from Murphy with question. Our

I Murphy. excellent an is you a mid-market Coss good Hey just of credits Mark model color And or this? factor taking particularly you with observability my new about has you They more customer wins? solution. much been you marketplace it How mentioned expansion This for the model. appreciated? afternoon. Thank the the to provide instrumental that adoption responded a cloud Has seen? an was Ramin, would fit Matt behalf wanted out Any on deciding a to in needed you question. hear X-figure for flex can be them. pointed credit customer. How have

joining for Thanks Sure. us.

to ARR are as those the move we we've just that, of to migrate for come be terms to our up a or clear, of that. to them the And seen upgrade XX% terms customers of waiting subscription lot First comment model. north credit their – on

the new commented model And traction upgrades roughly – seen deals, credit not we more, as as credit deals so, renewals the believe couple model. the And the well. good and last logos to X/X, of we've I on of quarters, in if are the new new

strong really was the credit was terms In happening that base what And packaging tiering seasonality So, customer in view but an and view. solution and from operating example, to that in their expected. continues their in playing and we point also of that's matched easy particular uptick they And that technology model. data. business I needed something licensing that financing it's the out like they of point be -- think flexibility they from of of a economic for them matched had and business needed a model model

to ARR landed over initially $X they they expansion So And of observability _ they're and million now where us. with full-stack grew a is XXx, customer. I believe,

also but announced -- value X-figure of those How land? this deal know sort the an a subsidiary, I scratching of you made QX just Got you or of And low-hanging you added How you sort after opportunities capturing you surface opportunity. international is you that going you making also then sure forward? it. the Thank fruit, see more how are organization make you. do sure mentioned closed – all that of an you're that providing that that do – don't across initial and this

sequenced infrastructure accounts, I modernizing they're Yes. Fortune cloud I they the migrate. and think transformation apps if security for out lot terms out and of which modernize and in larger of mean, they've or apps either or security or areas migration, a – to and which start of global migrating it's already phased

of it's that. so a kind sequencing, of matter And

tiers. sometimes technology And sometimes and or domain regional, it's it's by and

provides. started and to corporate are in mirrors that on to and model the that licensing the needs an other technology that's in So modernized, BUs of center other and that's moving brought open a trillion have technology and needs is model the where the off subsidiaries landscape data indication other be secure in to economic to tools to that and shift think shackled and cloud, and with needs then customer $X be broader They we that good cloud what board. get them Sumo the that migrate and need I some of source particular And case, environments. had some of

Thank you.

Our Crane proceed with next Please question. with Kingsley is your question from Berenberg.

you. thank Hi,

So in to space. I'd like the on check federal

then recent of space? and you you do the February, achieving FedRAMP-Moderate opportunity direct sales? in executive So growth in balancing heels what in Biden's And you partner and see are Fed order incremental how

Hi, Kingsley.

necessarily I anything haven't think impact from legislation we that, to yet. necessary seen

technology in, on and also activity. you in about, resulted the tell efforts as in we've And budgetary can the cycles. organic both I that the However, talked putting has increase hit channel partnership a and side and to have pipeline in the been we've you significant investments

something that's so and get time and great FedRAMP we've it's preparing the for that to attestation been And moderate level, a us for.

in of more back year, originally planned. see And as up now following half the and we're partners the year more and And just after going so opportunities. this out signing playing we that into

Red Okay. to just And Marketplace That's hear. great one the follow-up. hear to partnership. about then Great Hat

dynamics check to with the competitive like would there. any if and there's So QRadar on in IBM changes

Yes.

any various going and and it's vertical, whether continue security of strategy. lot this has IBM by as part through we're with security the this Red going a an to of by partner tools, large to particular different customers tools working actively observability, them fundamentally cloud and initiative. that's invest and that their in already on marketplace We're I and area accounts. to expanding is OpenShift as Fortune part or vehicle. think segments as about migrating customers that providing forward. case, We've well extending Hat identified are security of that own modernizing And a and it's business their and to third-party more

sense. Thank Okay. Makes you.

And with proceed from our Schwarz with Please BTIG. next is question. your Stefan question

QX, in a quarter, revenue mid-teens. is XX% should XX%? metrics this for end could north got revenue XX% of When you I've from above Hey, converge? with guide fiscal current up continue we and see for Stefan in revenue in question. exiting It Greg. looks to those but billings the on grew And Thanks the XXXX question. you my taking like up billings

Yes.

that around billings, basis. our at performance and at a look our we target billings we when on So trailing XX-month look

We it, will slip with make compare renewal that or a lumpy. that is that that pull-in. It pulled in-period have a larger and renewal larger we expansion renewals pull-in. And period. an in In a this future from big a either had will will quarter, bit had a particular

months, our again, So is our growth you at trailing rate look if XX XX%.

ones? Got the new the a quarter, last as M&A it. Thank And clarification. – highlighted you. same those or point are two those Is were ones of you that just then those downgrades,

we about that last ones talked different are quarter. Those

on any this growth or And quarter residual prior billings revenue ones? Okay. those was there from impact

meaning QX? Prior,

Yes.

we as That into QX been factored we QX. provided and entering would that have were guidance exiting any

Thank much. right. All you so

you. Thank

conference. concludes today's this of And end we question-and-answer the have reached session, the and also

lines You Thank you may for your at this participation. time. disconnect your