Sumo Logic (SUMO) 9 Mar 222022 Q4 Earnings call transcript

Hello. And welcome to the Sumo Logic Fourth Quarter and Full Year Fiscal 2022 Earnings Call and Webcast. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. to Investor call Relations. pleasure Liberator, to my of Director now turn over the Bryan It's Please ahead. go

Thank you. Conference Good Fourth Quarter afternoon. And welcome Full Fiscal to Year XXXX Earnings Call. and Sumo Logic's

today Joining me Lynne President Chief Worldwide of Ramin Grierson, President Operations; Stewart Officer. and Dougherty, and are Field Financial on CEO; Sayar, call the

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

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

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

a guidance on certain the in With [ph] financial non-GAAP Investor guidance, our release me that, posted available Relations Ramin. the forward-looking GAAP For is let reconciliation website. call over corresponding the now as earnings discussed our detail measure of on to to turn

for everyone and fourth today call. year us Thanks, joining on quarter our full earnings

executed results to We our we fourth of exceeded XX% the half and strong reaccelerate saw plan year, quarter delivered we XXXX. in We are guided in fiscal with pleased our which, high fiscal the revenue this the growth end on of metrics. the back again and quarter, all of

several fiscal initial As a XX% ahead year-over-year, guidance. result, we our finished which growth was points with the XXXX of

and and Additionally, and and priority contribution initiatives we digital strong billings saw migration we across greater we than annual drivers ARR, the cloud saw customers markets transformation the customer key quarter. were serve, growth base In this high a remain of XXXk. across our strength

surprises new new with contract licensing having start space broader their allows worry Increasingly, As secure and credit address in packaging, expand use and customers leading SecOps our of helps applications, reliable without to journeys, observability SaaS to flexible them negotiate a and will challenges platform for a others, cloud and address the to billing. requirements taking both native which case, advantage desk one ultimately our evaluate on needs customer analytics security. cloud which embark and their for then helps or modules about features

XX to of of largest the and $XX customers XX%. customers our of ended $XXX,XXX platform. guidance over in high ARR, We year-over-year of representing than year ARR, increase million more Turning to than We increase more their our with again customer came with a our a with $X end XX%. We million, adoption our base highlights. year-over-year XXX customers above Total increase financial with saw usage in representing across ended revenue healthy the continuing original in range. of distribution quarter a with the

customers. X,XXX ended we year total addition, In the with

highlighted, innings, vertical. the happening the and And year. This exponential early across digital is the think the geography amounts both architectures, is to which and make in data each new acceleration creation is of is vision of transformation we our experiences, reliable are infrastructure transformation, applications, new multi-cloud creating we of every modern adoption world's machine and As driving secure. of still which digital

IDC estimates grow apps at XXXX. apps million of XX% a XXX of fact, that will In by or the CAGR number approximately

applications CIO survey, a to of being However, monitored. less XX% currently than recent are according

So this is unique market growth, not the a opportunity at platform. Ultimately, massive than growing a is means also but only this rate our data a rapidly data increasing faster budgets. the for

differentiated licensing ingestion data on our solution costs tiered of by However, flexible credit-based model. type the analytics our usage based lowers supplemented and

makes has and this customers differentiated believe fact, solutions doubled valuable the on more as allows customers realize platform our In scale. more have We value continued growth a year-over-year. to benefits and grow and they our this overall stickier our than economics data as

we a our capabilities log platform and analytics complex of expanded observability stack to operational data other and our and and cloud to order a performance machine broader a have from native purpose-built log applications cloud address in issues to was reminder, ensure infrastructure requirements. set investigate to full unstructured As analyze platform security threats. solution ingest optimal and Overtime,

multi-cloud cloud structured data suited traces log We are both particularly native metrics well which and across generate run dynamic, unstructured applications, and and are environments. for

and like supply our security threat solutions. organization. and our and security more offer outside analytics, as investigation these rapid This cloud solutions monitoring more modern remediation. provides which as are, security security of cloud for through to solutions continuous therefore, causing required event orchestration with and intelligence-based an originating and has Log issues security cloud offerings, solutions. cloud rethink their to Additionally, consistent within identification, well the from dynamic We source SIM And of as companies such forms new chain threats, Xj recent landscape the software

transformation, cloud need security the and DevSecOps adopt of security the this modernization operations Given collectively created also to application has pace approach. teams for teams and development a accelerated application

initiatives these things: in for customers specifically, uniquely of security modern maturity and infrastructure. third, from suited large native sizes well stages all first, gain and is enterprise our helps insights to More customers do startups, transformation. application ensure platform three cloud cloud against digital protect of Our second, platform cloud-native undergoing organizations all reliability; cloud secure into threats;

wins tech often highlights solution. adopters a turn let complexity financial of architectural several quarter. to I'll best-in-class with new are Now analytics start key the me demands and and customers and services who whose technology some this earliest

of as well as digitally selected organizations. that disruptive types digitally highly advanced by proud transforming are We Sumo is Logic being these

a collect, in get per growing having sets than collect. The first and With to value single analyze which is prohibitive prior they wallet is their previous data both deal logo drastically And a capabilities, tier, without their make provide data their infrequent platform gigabyte, crypto win, ingest vendor. data compromise our a The platform, which ingest and times to it a budget. to faster them data needed economical with could company alone all I'll for partner cost the XX security. XX% highlight new reducing fast-growing tiering They were cases with and couldn't allows our tool of and the their on data that in let flexible was right afford from single ROI. their to cost and additional retain use their to or licensing observability model a analyze pricing

to that And out-of-the-box becoming we easier with Next, six-figure minister, case easily proprietary store more benefits as made well new of DevSecOps is a ad deal retail it our for integrations. our leading using as land them a to address of expand issues. and and to identify their was operations and the security more security as to customers security a analytics time We're analytics initial were our company also to were insights they with lastly, able because We solution offered the recognize to observability logo quick and selected initiatives. platform and with value teams data, to allowed see challenges collect our variety easier solution of security engineering, continuing hoc investigate use digital.

with several decision now to analytics and For for solution started better XXX gain example, also for critical are use to as and XXX This a analytics troubleshooting needed log using cross-sell their America. performance firm and applications. large them North six-figure in Sumo monitoring, security with a a expanded then ago they availability customer we a of for customer-facing Fortune services years This and observability. case full had financial top into was stack visibility

cross-sell are with as and we that's for strong has full to of strong This upgrade highly also required an solution, migrating for global observability, a them. and posture. another sophisticated them just strategy. a reliable, for chose observability seamless part the security modernization customer our use landed APAC, because applications their technology Given Sumo we cloud security a this also we logging not log stack a and this quarter six-figure and foundation their with and their but to had And was a business both value decision analytics analytics easy In bank a initially our that provide application Similar comprehensive to monitoring case. the allowing modernize they cloud last to ensure and troubleshooting single solution secure. example, them and to

our are channel about investments. For like to the seeing the talk last win, I'd we on benefits

one with response our we This who of and detection MDR provides a dollar MSSPs its expansion or multimillion had managed to customers. quarter, multiyear

hours. results, count. delivered experts more time As to journeys. platform initially MSSP prospects the XXX environment our strong because rapid customers using landed our their and are of and has platform. scalability portfolio within shortage have in value, leading specifically, selected SaaS growth.More our in and investments our continuing the can as we accelerated to as investments for With share proud well an and for more ARR underway. of to opportunity that Sumo summary, on go-to-market as companies growing which it as customers. remains to digital sell some Field spend as Worldwide some attacks large more and Xx exceeding and Since our outside like over these we security everything our and our over go-to-market continue so the continuing are she enhancements and expand Lynne team Operations, that have the additional continues transformation while than This drive observability of the yielding year increased optimize of MDR not customer them growth, now early metrics. to provide and to and their security President as perspectives total on some resulted of that, such expands are more are that grow, delivers customers her Doherty, I'm In as accomplished ability our by for Together, security, I'd customer allowing turn further to customers are execution them, We sophisticated commitment of onboard and they further well efforts. drive becoming our included to migration have context cloud already analytics these to demand this Sumo adoption and guidance and revenue our our

a truly now Logic I'm product Sumo to XX for necessary Sumo have Thanks, about my the in just and Ramin. large very differentiated quarter help The Logic love. is excited first I came And market to with I've and the And to have and solve that completed plays that. Sumo, our fantastic compelling problems. a at growing. a company customers in opportunity customers we first help because growth at that of market my accelerate seen future. a product truly days, I

more revenue. hiring. offerings rigor more growth platform. customer more to motion, discipline first case to our accelerate as focused three and even strong operational drive areas a enablement market with I'm is our allow best-in-class can as us base expanded in opportunity, product of drive To are into have which build and and customer well to new will building adoption capitalize a ultimately go-to-market this accomplish organization, this: and on multiuse to sales leverage growth We customers we we our

structure, added our with journey and process. metrics this in on discipline underway are We

our I have that teams focus that account and expansion Second, sales implementing renewals. frankly, is new on have resegment to or force align model dedicated I'm this was and to experienced is the results year. it changes as overdue. fiscal will These scale longer-term began change implemented us already to and strategic allow we will as And been confident yield focus organization. and This our a customer either acquisition proven have new

international path will expansion We also our continue key areas. our team as build we for in out

the and with strong our Third, able and By there AWS. customers' and we together Year. with is still strategic transactions digital on do most with renamed channel, continue Partner we had we partners this partnerships. are to strategic migration will or global can focus more Even provide our as through AWS increase I ISV align on accelerate our co-fill our progress, of strategic market embark a AWS, leaning we We cloud very customers year journey. going the with a to motion in think partnerships transformation into

including partners. bars a we for organizations. Additionally, plan focus strategic as increased with our sales drive -- and partners bigger other to our strategic MSSP focus

our QX pleasure Officer, provide With We to will to Chief who momentum it's details for new forward markets. our partners and will success our fiscal results that, internationally bringing and XXXX. on in partners grow also have leverage Financial investors. looking my presence more and through team, our now year to Grierson, in next outlook Stewart financial to our continue this more to our I'm continuing and

Thanks, call. be of highlights I'm on a topic. go at with like the on here joining to financial quarter Lynn. excited And the Sumo. thanks, to the more each brief detail us and I'd everyone, then into start for for summary

fiscal of in XX% with as performance full year-over-year strong revenue growth revenue growth the First, resulted in we mentioned, finish XX%. year-over-year saw to for Ramin year This strong QX the year.

QX with spend grew a that us, continued was than driven year customers more with customers XX% $XXX,XXX Our traction these revenue year-over-year. as growth our by

analytics while shared, we our customer cloud-native cross-selling platform reliable applications. cases As customers successfully the cloud enable use to highlighted secure benefits observability and security as are by winning our deliver of both new in the entire the customers we we and markets also

representing further evidence ARR year-over-year value customers, than with our ended As more we growth. provide the of XX million, XX% year than with we customers the $X greater

that and best was to on is acceleration introduce in each metric on investors with which ARR the like of ARR. leading metrics provide growth reflects will year going XX% We moving transparency business representing growth million, believe metric current other be providing I'd is business of a greater we basis, a prior some new ended quarters, will Before in of spirit growth to also We is to the dollar-based indicator year-over-year we the quarterly it have and calculated the way report our trajectory. our average ARR SaaS an a net the to as a of which calculate four XX%. year retention. we trailing have we the ARR transparency, This from using on and this change of Historically, we of prior growth. $XXX In quarters. significant are similar shared

trailing trends methodology Going our forward, this align metric with use simple provide reporting net we our better will into a in and to dollar-based business. better to visibility current ARR calculate four-quarter retention

both and was trailing expected. four-quarter view, ARR. previously of taking ARR below The XX-month numbers. dollar-based the retention this than share to customers of the sequentially means quarters, I'll XXX%. the the average Using prior comparing net remained and communicated period the from clarity, our cohort beginning four as QX current the higher it their trailing period For XXX% of while this at call, On simple

new higher FY our our in customer growth ARR fairly expect And be of our FY retention customers realignment new The by a by that customers growth net with the in 'XX. result, our as we we sales 'XX ARR this of XX%, added Taken year. stable acquisition next in result use last driven was conjunction existing on the a of our XX likely over relatively force means to the focus expanding will the our and platform. months in equally dollar-based

billings year-over-year. timing period over million, can period metric billings our XX% we up this Calculated that and trailing for at the the a quarter-to-quarter as trailing billings. duration to XX-month look customers. $XXX.X billings fluctuate to Recall due XX-month was for from calculated Turning renewals of larger

customer and strength contract RPO. RPO of or obligations extensions. year was million. ended on believe in performance early to Current perspective RPO remaining of with by to RPO. be indicator can or the RPO positively future $XXX.X CRPO growth. provides committed renewals Moving opposed and being impacted We revenue $XXX.X an the as We Both contracts million

an revenue the the and While indicator is this the is it best company, for platform our future growth. not value customers from in year-over-year confidence our get proxy of

For be basis, a will longer will on RPO reason, disclose go-forward but this we disclosing to no continue CRPO.

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

reminder, unless release A As a our on are and all in website. measures otherwise non-GAAP. non-GAAP to noted, is GAAP metrics posted included reconciliation earnings of and our

up year-over-year. revenue QX million, total $XX stated, previously XX% As increased to

customer, QX $XX.X was up million, largest XX% Excluding our year-over-year. revenue

more to become overall this Fourth As the XX% we breakout is customer our gross to activity margin relevant. quarter business, with was period. largest previously compared ago because out quarter signaled, our that this less has in year aligned plan last we the their making break XX%

gross annual Our was margin XX%.

This onto data ingest than our year. last encouraging to has our customers strategy of the in doubled Our more consumption data reflects more platform.

of than their perfect to faster Ramin As company a customers example, continues the by shared grow business. required crypto example take data earlier can our The data architecture capture budgets, data to this. tiered advantage of is

creates While is in value-added more we margins, future. us gross downward believe cross-sell this some a it pressure upsell the differentiator that to unique will features and our on strategy allow

remain in adoption strategy forward, execute as to Looking in we drive on order expect XX% gross the continue the margins range to low of we to our further platform.

marketing same the as and $XX.X revenue, Sales it expense or XX% of expenses. period. ago operating in to was on year Moving was million the

in XX% year security and a 'XX. The and markets in period. the opportunity to revenue and of FY revenue In expense development public to ago to go-to-market coverage, growth company. are period. million was take FY the million $XX.X invest as year expense continue ahead, and of our so sales marketing a XX% expansion revenue to are new 'XX, operate of advantage to revenue the compared and $XX.X in in observability G&A growing of front capacity to or XX% was make markets, we will we required ago will market and expect revenue platform in percentage large Research Given opportunities increase of to continuing us. to invest as investments compared of or continue the in XX% expense of we

which our margin in operating end driven than range negative by outperformance revenue guidance was the quarter. high XX%, the QX of Our better was

share shares negative operating annual Net the quarter Our million million was outstanding. weighted or $XX.X diluted $XXX.X diluted margin average XX%. in negative on loss per approximately $X.XX was based

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

A For revenue. from free was year. cash flow year, the the prior XX% of significant full negative improvement

We improvements expect drive of to continue flow modest percentage a cash to FY free in as 'XX. in revenue

quarterly guidance, to growth relevant rates. basis, on potential volatility believe that is full judge Turning the we more our growth to in of it year business a given

the earlier. In addition, described takes guidance force our recent into Lynne consideration changes sales

$XXX year full total For weighted shares expect Non-GAAP to and share XX% growth. loss average the negative fiscal to approximately operating on $XXX negative we non-GAAP year-over-year XX% margin outstanding. XX% of million, negative to XX% XXXX, revenue representing per of to million million $X.XX of XXX.X $X.XX

drive in our of Non-GAAP shares in and approximately negative finished For sales and XXX of gives the the second marketing to average total outstanding. integrations. In confidence of the the growth to to both representing share and million, increase we million revenue XX% XX%. half of to This reaccelerating delivered XX% of and per summary, execution $XX.X the extend year-over-year investments our platform year. goal negative engineering million fiscal our to on $XX.X weighted technology on we growth. us expect loss functionality year strong revenue to first $X.XX quarter, non-GAAP negative operating And margin XX%

With questions. and early are and We of Lynne of cloud believe uniquely migration. Operator? deliver and any your transformation analytics the cloud to that, enable take cloud I And our applications. in companies platform reliable are to Ramin, to is digital happy innings positioned secure

question is be today now & We [Operator you. Cowen from from session. Our Thank a Wood Derrick first conducting coming Company. question-and-answer Instructions]

line Your live. now is

of a strong guys. go-to-market on congrats And year. strategy for to nice, the team the finish questions to Thanks. A Great. you couple

like it case, more I'm me first, focus there's The going if be wrong, resegmentation sounds about if with but talk in that's to customer new generation. can the sales, bit Correct you a after how the are your of versus how on get just the for to and you do grew year? sales in mid-market capacity And guys what in sense rep in growth the you're of investing enterprise? thinking capacity year next maybe looking a going

Yeah. Really set questions. of good

So proven realignment the me let resegmentation with model. sales at is moving here SaaS us a really Sumo to start

both as well focus does so in expansion new customers. on on it bringing logos focus And us renewals give and as of

our and getting initiative international we're business account go-to-market And diversifying accelerating investments. so mid-market and really is The which important. enterprise our clarity aligns focus primary with in expansion. And managers’ roles and roles, and again, both with growth our of

to do We see we continue the every year where evaluate to investment that quarter, say every growth opportunity. in the

And look the something and at trade-offs accelerate to we right we'll optimize and so so make that's that growth. continue

tight asked labor It's a about capacity. also the market. You

enablement. We got making continue have both we've we around the made focus investments also And the compensation out we talent. effort talent can to the of a to retain we then there, best We've have new that competitive best attract in lot and so recruiting sure hire.

and do the of we that's So have we're market. we people summary them in how the that there? doing bring So best make what some go in to out of the

will of That's you the is certainly of color. a business stat about segmentation did Yeah. be multiuse multiproduct. your say renewals saying with on you flip I Thanks, that, maybe and XX% helpful think Ramin, or cross-sell. side the I remember And Lynne. focus And onetime the on

you can cross-selling? What you terms trying kind kind other expect if what to see of You've technology the personas, uplift different that maybe ASP ops, to of quite Sec invested of of in and target products, devs, and cross-sell bit portfolio pros, the kind and the success we typically platform. a have expand in

then developers hand. two SOC on the to type Sure. and CISO teams second X it's being platform Well, guess I to centers, on and more to And teams. the Sumo X sell buying new hand, engineering primary not

been I So massive alone let that broader on. base analytics, effort to and security observability, been able to has back SOAR. question, installed us your into go and be sell something full we've for SIM But guess opportunity focused to a our stack there's

there's advantage coverage, with the into hunter be base, of So model a transactions. new cross-sell, on on take drive realignment drive great particularly now the the able opportunity us back upsell, versus to installed go for farmer let to to logo

Great. Great. Good luck. Thanks.

Derrick. Thanks,

Thank you.

coming Your from Hedberg Markets. from RBC Matt next question Capital is

Your line is now live.

Great, guys. Thanks for a acceleration follow-up had taking my questions. looks Congrats for on a 'XX. the like I question fiscal Lynne. acceleration on further what in

conversations to or one out you in both what and things why call, Ramin customers. On Sumo the is there great to some and still of deals. a two given those is Sumo why expansions stands new and differentiated both with new the examples having you're existing new versus company, a gave Is peers But customer competitive lot wins that to won you're reason of market? obviously

customers. I I'm having and with Absolutely. right, And team differentiated we And us. market with of you're I have customers lots love came conversations in a growth product a because mean Yeah. our and here

a when go-to-market. that's so to And great be leading you're place

and single that single security, to reliability and for a I platform. It's that customers want customers trend and a platform why want scale think question winning. we be want to also continues customers the that platform who are of to a a move of cloud-native

then growing anybody. about And budgets. keep than talking around we data is I that faster than probably that the so better And And economics. is lastly we do think

data product way to cost-effective way. a customers is real differentiator. the do we but they allows do the and so of And licensing tearing that to our get in access it It a need,

Thank for And you Stewart that. then, That's great. you. for

working to And there the the you're to well with ARR, thanks for forward net the welcome aware But guess I at about disclosure a all, company. there we ARR also, given for retention. you anything not I should -- of new metric that of quarterly dollar-based as ARR, looking guiding again. of to be as this think should a is is First you look ARR guys? we rework fiscal 'XX for revenue a obviously, seasonality that perspective more is from in newer revenue guide.

again. to Sure, talking be to Matt. And you nice

perspective. And so from I annual think we an on ARR really focus

And would just the so revenue in had why I you look that's if at think historic it. business about you seasonality trends. encourage We've to

so And which kind of sort we not an why annual no, this. to to of is will be And we're pointing number. guiding

your to today, best to SaaS gives from think XX% which do a meaningful business for in obviously, ago chose point, business around the the that year why the XX% last visibility reacceleration happening what's ARR year. and in is we a I to

Thanks, guys.

from Your is question coming William Kamil Mielczarek Blair. from next

Your line is now live.

year. strong taking on And Hi. Congrats into for the thanks my question.

starting just So maybe research on side. investment the

Can next the years, opportunity where add differentiation? announced balance to new products to enhancements over you number do functionality year. and most over further provide you across You a see drive color few how more feature of R&D the the the today? spend on last you product portfolio out And looking

Kamil, it's Ramin. Thanks.

at it installed our penetrated observability. first versus and continue required evolve foremost, capabilities. And think from what logging to what's look we market our we're to and opportunity base individual versus pertains to as it security where I an -- in

Secondly, deployed a right? use from how the naturally, then as third, percentage service needs and to cases. the margin And in of rolled various be kind of for revenue and a various out cost regions and

on very the security, summary, observability both. deploy the and or answer the to observability newer think or have a irrespective But of scorecard, tiering security the service. and bit a question it's little and balanced time your is so best in take contribution of as speak, to we more features Now we and way scale I across enhance

a in factored point margin view. of is also that so from And

stack full a Now competitive have think here available market meta the point very is we I solution observability on today.

existing a security and well security store analytics security go analytics, SIM as competitive alone customers similarly, and customers, now cloud after well very have with as Sumo for a non-Sumo opportunity So both alone SIM to let let cloud we as SOAR. customers just

So that MSPs of meaning our indirect, channel direct look us and versus at lot business. with a expanding it with portion that to landing partners, ways gives of

just hit hard could I early saw the in were pandemic. up. verticals follow downgrade if And Ramin. year year, some in the that by customers helpful, particularly you That's or Last

changes macroeconomic are industries changed broader the noticeable Thank year, how where customer quarters? in generally, you. And Given you've there relative over in your have demand change to seen a more the any past conversations positive recent whether or negative? business,

where I digitally I is with native versus win secondly, digitally mean first we customers. or trying being left are foremost, Sure. think, behind. and where to transforming And customers

who faster perspective, digitally transforming gaming, the -- enterprise So seeing means in globally naturally tech, verticals. that as in better well than saw also as mid-market services, APJ we're e-tail, some traction vertical media, where strong other last the strong an that financial quarter the tech retail both are of example. and be a as that's to those from And tend we

That’s helpful. again. Congrats

you. Thank

Your from Stanley. today coming is Singh Sanjit from Morgan next question

line now Your live. is

Logic Hi. It's and quarter strong taking I'd you landscape on Wilson Singh. of the thoughts of our Thank that threats for help you or are kind your of to threat like kind hear ongoing. Matt about of of haven't if they to on of finish changed the Log changed seeing? kind conversations talk come how alleviate to some events customer customers the the questions. on elevated like year. for of congrats to security Xj Sumo Sanjit geopolitical other our they kind some kind how Can And have like and

Sure.

within operations bad the coupled are It to a threat accidents that access The used these when let far challenging, traditional what the more as keys more you the APIs, fact trying even landscape distributed people protect applications and happen way workloads get unfortunately, lot fewer than security to versus with that it nations, very have firewalls moved and bad exposes the attack. just cloud. so are to there's architecture doing. actors, So teams makes alone of And and migrated organizations. and of

So modern DevSecOps to these be a mean able as are result, having alone organizations issues, across adopt value chain collaborate to the proactively. fight to the let approach reactive

we as a the want we else compare? need those from and terms I'm how to internally transform, about tooling doing I I about already three I partners. buckets centers it's to in about talk thinking be move what tend a organizational our customer what digitally to versus One the clear. also that be of technology? And conversations, be processes Two to is, to thinking and and lot do cloud? pretty Now alignment need customers channel three, do So to around

resources. Now because from labor, to that's either shortage them really to in complement where one of bring maturity perspective Sumo superior MSPs, is of technology of customers are great of secondarily, because security here to for partners complement a our of particularly, SaaS the EDR/MDR and a or aspects this important leverage because our the to really opportunity

you. Thank

you. Thank

Gray next from is Your from coming Powell question BTIG.

line live. now Your is

Great. on Thanks and so back taking sales the Yeah, the maybe questions. side. for focusing marketing

sort we And should revenue of and it way least So of like paying incremental of the little how investments you're sounds baked Is the those we invest growth thing? what how there in expected. of of bit layering just more a fiscal 'XX think that guidance? going off? more the it fiscal about then at we from current rate? Or should investments into there in timing through a those aggressively to Is 'XX think much into the

Yeah.

that it's So answer question. I'll Greg, Stewart.

you right? reaccelerate if that started the about telling of XX the we half think year. the just in growth what we we've would months, back So year last the in done So

demonstrated we've that. think I

And at with significant of If comes investment. ARR, you disclosing now look that the pretty reacceleration we're that growth.

we in this Lynne's then marketing. been on and So sales we've invest. of year as continuing And investing some are and the changes board to come there,

guidance, with obviously help capacity. will will guidance the adding year FY we as well. it's revenue 'XX It's into also but So this And the that flow gave enablement. the

And versus that this or revenue or anything That's follow-up we last? differently the realignment billings be on resegmentation, would like just Okay. the should linearity then think with year and about helpful.

so. don't I believe

much. All easy. very Thank right. That’s you

you. Thank

Our next question is today Piper Schmidt coming from from Ben Sandler.

Your now line is live.

Schmidt Ben question. for Owens. Hey. Thanks for on taking my Rob

Lynne, for I one First guess.

beginning change ramp focus? teams any fiscal can you So talk there off I we of -- only expect than time has of any this bit these so you've their initial building year, the about? only mentioned more last but little here at got the you should question, as the you've a traction been sort that made month was here, And like a change know

Yeah.

it's in a with think who ramp, probably on I'm and employees, get we focus them do I mean, sure or we think that's a have if ramp we and big people as the is our they mean of us I jobs, can how new with similar you focus around enablement not but bring of question to how organization. new and part changing employees around quickly effective sales So efficiency go-to-market are answer. time, I as

and and as about. different have But some get into all there in guidance Stuart that's I focused the been we roles. Ramin people doing baked think talked coverage more that changes roles customer both naturally, are

that I think we're shape So that. on good in

care it's sure a for customers that how good been I sure think that of premium we my care of we our focus have real through provide us really as customers take transition to we we been resources that that and of do taking experience on really that. has make make

answers that the think question. I

second I second a question? had think Is you a question. that

related feedback The could give? that, any to or second just you was initial traction

smoothly. say, Any incredibly generally, would Yeah. it's gone traction. I

so what And big been hunter incredibly get smooth to a to really I a us for farmer It's big like change focused. sounds that a and move model know that to an change and really of us. change. in been put us evolution is place started, level on for really really rules. already what's those an of to this already the next evolution focused and get It's is

pay to I start and to So excited the see smoothly incredibly off. results it's gone think I'm

the high-level going for second And like fiscal the I Lynne. here year Thanks, 'XX, gross discussion If Ramin either low-XX%. or Great. Stewart. for around it one understood margin into sounded

that our that that about over assumptions initial or models lower as so? in So that if changing we've last should lower the we had driving year expectation? is lowered the thinking than what's And be

quarter expand margin. bring And new see Well, inorganically of we on we regions, commented hit last as as this. alone acquisitions, our market temporary a the the particularly, we on let organically, gross you'll through some to capabilities

on be volume our to the to second Xx enhancements platform of The we quarter data. made more data of X this and the analyze of commented because was growth volume we times thing able to than persist ingest,

with that's more cross-sell stickiness So kind additional drive features to we've then and use cases. the and been of to ultimately able intention be adoption, signaling

you in well well as our be as deliver part those to as further should of as acceleration. low-XXs So the value conscious benefit strategy expect margins as revenue to economic

Ramin. Great. Thanks,

you. Thank

is next from from question Your Thill coming Brent Jefferies.

now live. line Your is

guys. Bill is Hey, our on This for Brent. taking Thanks for question.

about us your a if organizing how click thinking sales you on an we're in update And Thanks. tap way? markets give that, those channels wondering maybe realigning to you're on could just double theaters? bigger the international how Just you're

continue Yeah. I opportunity. a see International markets we place to be growth can that a think real

that success on And invested, into our there new move already as so markets. investments down as is we really -- double places strategy in we're seeing have some to to strategic where continue down well doubled

So believe or and be I an distribution important MSSPs Partners we can always -- see VARs that's traditional that a whether that's an channels. role, place real our strategic whether continues opportunity to a international play important those part markets in or plan. growth of or that's relationships

internationally those both we're actually make accelerate us, Americas. a And that sure in the focus a so continue and to for investing to year we and market, is be channels rate have the to place that will that this

markets into that to is us strategic leverage relationships a customers vendors accelerate with the of or go-to-market. ones we piece So enable move just move world, across our are to the faster to MDR not leverage make existing focus in lot MSSPs international the channels and sure to their that partnered is are a and making

theaters, across X more India well we and Japan, add some countries more. grew XXX% and contribution that in bookings I'll pretty contribution those international Tier and QX coverage in countries fiscal us from as of to thing capacity at But is APJ particularly for still our and 'XX. we're underpenetrated a international perspective as we for look from as Tier that Only feel X

We in have Fed. LatAm opportunity a great and

we a of to holistically, incrementally add and we're deploying conscious look how partner we as capacity channels versus So choice incrementally drive push footprint.

Great. Thanks.

you. Thank

today from from Our next Rosenblatt is Blair Securities. Abernathy question coming

now is line live. Your

nice here. quarter Thank you. And year ending the

drill to this big just how are some of sounds on in growth -- to I understand overall And bit of you? was wanted on MSSPs. to a rates a opportunity doing you. the sense or comparable is channel Just rate Just just market. I'm really kind like an the And that more well for how it of MSPs wondering the it faster? trying Ramin, growth Can get little for company drive big

to has MDR, that few is providers, tools think MSPs seamlessly. technology first foremost for general able I around Sure. One, to evolved tools from a can dramatically SaaS EDR, deliver point and space changing the more analytics traditional Well, considerably in service pretty the reasons. the be MSPs, MSSPs,

of in VARs a lot Secondly, tastes are becoming addition. the MSPs

are models So business transforming. their

Third, they and and integrate can't build homegrown continue technologies. to

use huge to ability that the allows enhance like So for to the differentiator them. Sumo needs but not only security even left to for SaaS them a and platform addresses and DevOps modern is shift us

make and their the alone the there ultimate friction, is as customer. both more side proportion So the value technology made not to simplify side because that also us, importantly, side only investments as for the no well there's contribution own but even be particularly for on we've of I investments to sure compensation think on it, VAR our reps from larger in let a the delivery MSPs, margin could but to reps,

That's great. markets, to us federal Thank to you. government over or shifting And then that the update in market just anything segment?

FedRAMP year, been government and that enterprise that of Well, more customers building We've continuing the the way Lynne's well and there early Moderate the public of and there legislative feel sector around direct team grown to substantially with logging, innings we're we partners of certification let customers get the list listed. push are there. FedRAMP, we're as requirements coverage We some get last out that did with partners. in to require the some alone as opportunities

in 'XX in be seasonality in able the also year. that's next So more we're only into but something budget, to year and FY quite this fiscal that drive not to investing the

Great. much. very Thanks

turn and of I'd end reached does We back the comments. like teleconference. question-and-answer any you. today's Thank ladies And session. further gentlemen, conclude floor our for or to to closing management that

that for with We we fiscal portfolio, after digital our transformation the side for platform. technology we're happy of believe the underpinning very our in and right we to that and year. made opportunity much. fourth And our investments 'XX you on a conference go that positioned feel the them very with cloud for last we're well let as our we market results continue the massive Thank with migration, go-to-market evolution. and on single Thanks, call. products everyone, joining We're quarter

So we appreciate your talking to support. to soon. And we look you forward

does and you. Thank today's conclude That teleconference webcast.

And time. may for day. a thank your today. You have this your We line participation disconnect at wonderful you