Mimecast (MIME) 4 Aug 212022 Q1 Earnings call transcript

Good morning and welcome to Mimecast's earnings call for the Fiscal First Quarter 2022. I'm Robert Sanders, Director of Investor Relations. With me on the call this morning are Peter Bauer, our Co-Founder, Chairman and CEO; and Rafe Brown, our CFO. Today's conference call is being broadcast live. A replay of this call will be available after the live call has ended.

statements the events company. forward-looking financial the make of performance will regarding and future future We materially the These pandemic. and uncertainties the cause differ ongoing uncertainties statements related that those forward-looking are security the could actual subject to our impact results incident risks of statements, including forward-looking to recent risks from and in and to COVID-XX global contained in actual consider today's statements We risk cause differ important and to release this in could the call. results caution the from on those you that factors to forward-looking press conference recent These XX-Q Exchange further risk factors defined are with in and Mimecast's Securities most Form the filed Commission.

found statements can believe of information this forward-looking The result is or are Any non-GAAP 'XX. in our be release, a are we We on or as and date. new August obligation superior During representation non-GAAP measures no not and intended A to these GAAP to our to of our substitute undertake the for, update statements GAAP X, in assumptions this as website. included which reasonable present section date based that of of today's make of measures this we is call or non-GAAP call, be results. GAAP be to to both from, the non-GAAP financial press of measures. reconciliation for in today These we Investor considered Relations information the a events. reasons will future isolation

the to like Bauer. turn I'd over call Peter to Now,

appointments us on the environment our Product markets. some and And new to doing some our improving hope the great families joining then and help our Rafe you our Chief and And you that address and key new Both us quarter our Marketing well. landscape execute through I'll in thank macro Officer. continued underscore begin organization are the the capabilities talents results. everyone. progress Technology I'll morning, of on our I which to financial and will highlight Chief take with Officer of also for touched bring takeaways from Good and threat your new strategy. detailed us.

to pleased end results in all in up that generated XX% across our We metrics. revenues, high exceed of constant million guidance currency the $XXX.X which are We quarter report is this year-over-year, terms.

increase a approximately services drove is prior of of X% up order year rate, also up sequential we We constant And importantly, $XX,XXX, last the is revenue an And X.X, to in currency. in which customer in over improvement net our XXX% which quarter. delivered year. to the from we average the in retention increased value number retention per X.X with

existing results had our we multi-product these new to customers. suggest, success portfolio As selling great and

continue of with coming growth seats more. our organizations including across the or XX% from have We revenue we Enterprise, all where segments XXXX

number of In their amongst a better saw Mimecast, our place an set, We the win. strengthen we particular markets. As larger two now to organizations positioning XX,XXX UK, our brand strength milestone. Mimecast reputation over into new trust this to net We continue family North customers serves growing the quarter. customers. achieved in Mimecast and us XXX in to America this we brought total, continue important largest customer

recovery of some our international lagged. in While markets, has

line margin, bring grow. our base a flow, customer growing free free bottom platform, million XX% Our continue generated expansion cash and scale in we will as our and flow we to $XX.X cash

strategy. advance to our continue We three-pronged growth

create and to engagements in our we and As partners. the for automate our multi-product our use easier our to stronger we even channel SMB customers we expand sell Enterprise market, footprint and platform

quarter. Let me share some highlights from the

professional protection A awareness XXXX new subscription me organization share based product, their medical product also UK purchased employees, animal X Enterprise secure Security. recovery with X our messaging and some and anecdotes our in employees A Zone for in of Web based Zone signs X, our here. showed offerings wellness selected UK Zone business XX,XXX Analyzer, recent their firm XXXX UK wins let Zone training of services Zone and for Our provider a and in included our X of in technology added more the and global DMARC two X EU purchased employees. based

provider African years. based the to deploy now all defense noted a based financial across customer We three services well now a X, governance services on quarter, vendors cyber with across and well our consolidate seats This multi-service services now upselling Mimecast X, added Zones Large largest that's and to Then for we our for employees Mimecast as earlier, too. for Zone XX,XXX deal been XX,XXX X, and following healthcare and relies As and Mimecast in of Messaging South they upsell our an security employees. our Continuity, service. File data have five acquisition services with X customers as messaging their Sending, use zones onto across added significant their chose employees a X all Secure UK figure And services And offering. company secure protect as with this as and XX,XXX existing a success seven services they to achieved us Services. ever firm several platform financial US

services We to also selling new bundle customers. had success

XXXX provide of medical For this Exploit example, us customer. Brand to comprehensive Internal employees manufacturer to offerings, products CyberGraph, enabling with newest Protect, and a our Isolation X, Zone Browser Email and purchased of protection Continuity, Protect, US two

who our Zone also X And few their Internal and government XXXX US We of for a significant for employees. suite, XXXX municipal products County their purchased Protect nearly the customer Email products, wins XX a the US including large sector new had entire public government US employees. in a purchased

a We customers with Information in certification selecting CJIS Missouri customer employees. milestone Additionally, lead we XXXX Criminal win the could in to future. additional sector public an to important CJIS Justice achieved QX new Mimecast Services or in and over believe led is certification that

supports our multi-product and enterprise As these both strategy. public examples our in highlight, the our expanding sector footprint

products, the In DMARC service terms contributing subscription popular be Analyzer among continues customers, to our quarter. our revenue to new of in

strong customers. based support And CyberGraph this email a uses product module engagement quarter, Protect, which in X.X of and particular And Training innovating consistent machine and and Awareness successes strength mitigate customers, our new AI to most saw net We new and with believe we're counteract we Underpinning this the error launched with leading and with XXX our learning on our Email CyberGraph, our focus Resilience and advanced Cyber and market Internal Security expanding position. Email continued also is seeing for will platform, early attacks. all our respectively. XXX strategy human

also orchestrates with over this growth API supporting their Humio, with integrations fastest allow already. partners IP company that alerts us and XXX partnerships joint technology CrowdStrike Alliance help And quarter. security program And they one API CrowdStrike The to of [estate]. Mimecast a customers and launched this continue an relationships. deepen capabilities into Among partnerships our this quarter across the we enterprise organizations Our incorporate new pioneer strategy. our win new was integration organization's automation ecosystem. broader intelligence and also to with existing threat security customers integrations growing These and actions partnership is is

customers company. using largest including global it, Some of XXX,XXX our person beverage

threat landscape. to turning the Now

That's food XXXX. profile as year before over that heard June over targeting more files increase as attackers malicious we me last energy networks, and capitalized resilience from may than companies larger to more million XXXX. a that and world US important on the say hospitals more Emboldened You we attackers moving high XXX the the and attacks from are XXXX, several across ever, January companies from months. ransomware than transportation than remote XX% more And is we and the through supply, work. disrupted a saw nearly increase the saw cyber XX% have in blocked

impersonation the more provide targeted Importantly, all attacks, strongest products believe of integrated and of progress. the XX% April from to with platform resilience against on helping stakes protect available detection attacker's Email early to the all We determined XX% mitigate their the security reevaluate and of have an ownership. attacks cost Mimecast companies X.X with with of recent attackers believe together seriously, these our today, prevention companies companies security most June to ransomware access as high security our them email. help system privileged cyber of attacks and more threats, total market and works have made systems the and including targeting and that email and and originate We even budgets illustrating systems. lowest take is multi-product employees nature at organizations cyber through approximately risks campaigns. than Security information via From were

to new Leger quarters Officer, led David now taken that We through us And and product the And and our we've Chief several over transform our investments are to and turn generally go-to-market and our we new accelerated strengthen Technology Product it with I'll help platform, our in continue to of the with integrated an creation Chief marketing actions last organization, over our led momentum. by expand teams, continue Marketing engineering confident Raissipour. our progress Rafe. to that, Bernd the Officer, by

to we the and flow revenue, of adjusted our cash for you, free Thank Peter. EBITDA guidance the report I'm first of for that quarter pleased exceeded XXXX. fiscal end high

see And to now I selling both UK bounce performance like economic particularly turned see largest markets. back to of they begin, note pleased recovery of I would our were signs we strong improving in in to continue are America QX. As environment. we that seeing as North the an

smaller of While of two recovery approximately America some regions and improvement particularly in signs as UK remains the our COVID-XX encouraging, geographies, these in first are dynamic, of of North continued our in revenue. the the impact the comprise XX%

first currency year turn dollar revenue million, XX% in million revenue foreign tailwind, absolute the generated for which since impacted over In prior the $XXX.X the positively that to rate improvement our quarter $X.X our providing Adjusting the Note first was of by for $XXX,XXX. guidance a fluctuations growth represents our currency quarter. currency now results constant prior results. we Let's terms. of XX% in quarter, year over May,

that rates, customers continued driven X.X last base or in compared customers $XX,XXX, to up in new XX stands as X% average results total currency smaller added customers by saw The in in the segments, the order X.X sequential customer within our XX,XXX. but constant quarter, improvement line customer a per to XXX services of fourth XX, we Our noted at XXX% Calculated base particular, we the ending our stood higher retention at count but average to Net for were seat over our count first customers they the building terms, among as customers our prior with services year-on-year noticeable metric this all new seen top AOV. increases customer new per a of June in of new expansion was approximately July at year improvement added off for all well rising stabilization customer We revenue employees. period bringing values decreased across quarter. churn. helped year, net last as services FX sequentially this number and time AOV quarter customer net

feel As and calculate it important a to trailing a we as it on customer this dollar basis is four based opposed particularly reminder, purely count quarter metric is based. as

based Looking where totaled as XXX% strength components, we price well upsell as and its seat upsell at product upsell. saw in based both

On saw side, the and our in quarter as Training in solution. fourth with X% totaled first CyberGraph the DMARC the period. Awareness product and well our Downsell interest newly for good solutions, released turn strong churn traction as quarter

macroeconomic rates It the churn evidence of improving began further business. We noting since retention improving this net stabilization and seeing first that seen improvement downsell signs are is quarter and the the anticipate worth will this trend. an our revenue that providing metric an continued strength of pandemic the of we've is environment in on further

$XX.X improvements a XX.X% year, quarter We XX.X% the long continue basis achieving points prior In good an basis towards of same quarter the quarter to point XX% the million from margin to recognize margin, in drive we in the the non-GAAP XXX of up an our for step compared quarter, non-GAAP EBITDA a gross term margins. goal first gross XXX a prior improvement. year, gross representing EBITDA Adjusted first margin. the XX.X% totaled adjusted

average basis bottom $XX.X $X.XX for the per profit the operating XXX to first million net fully quarter, share, reported based of of weighted our line, profit XX.X from income turning or of We was points an $XX.X million, GAAP Now of or year. outstanding. diluted a for the the first non-GAAP on million prior XX.X% quarter revenue, diluted improvement shares

tax first expenses $XXX,XXX million. of which GAAP quarter, totaled discrete included a Our windfall in $X.X stock the benefit

to $X.X recent million. Given GAAP we expect full approximately windfall benefits, a year tax tax expense be

a such, a share. quarter in We've rate Consistent other It note like I approach cash as in $X.XX non-GAAP non-GAAP To starting periods, tax financial fiscal pay. which long this income would projected is well tax non-GAAP first the an per our our GAAP non-GAAP This the million, the XX%. to non-GAAP is long we're figures the presents tax was a applied change for table profitability methodology, tax note making methodology SEC's the for non-GAAP we no applying income term consistency calculating a this I reconciliation the notional on income. diluted technology tax rate provided that of estimated of in last of our would we've quarter. included tax summary year. by note This adopted pre-tax for Financial pre-tax effect important with our income earnings. press solely term XX% release, reporting these Interpretations to as income, also better And recast purposes was taxes guidance level number net rate of net of tax non-GAAP expense our impact rate. net with we've made today's using or non-GAAP rate and this effective that consistent across of non-GAAP non-GAAP non-GAAP rate or Under consolidated Our Measures as change have statements projected tax we the to prior $XX.X Compliance our commensurate non-GAAP successful is with interim an XXX.XX. to a provide accordance businesses, adjustments. tax to a non-GAAP with calculated followed Disclosure quarter, excludes

Turning flow. cash to

flows Free the cash XX.X% operating for quarter of cash or quarter XX.X% of First total million million $XX.X revenue. revenue. total flow or $XX.X

June stands Net XX, balance the sheet. of of cash As of debt, $XXX million. had on $XXX our Mimecast current balance million at cash

now turn guidance. to Let me

currency revenue For is be in the to XX% XXXX, million $XXX.X expected terms. and to second growth quarter million constant XX% of $XXX.X fiscal between or

expected from $XX.X Our as guidance quarter includes rates of is to million EBITDA Adjusted XX, resulting positive July estimated weakening expected the the exchange of compared be the the XXXX, year. impact million, and and is of based on between for dollar to million an US midpoint at cash prior second $X.X be the the EBITDA $XX.X from an margin XX.X%, basis points year. reflects at flow for of $XX.X XX.X%. and margin $XX.X second which midpoint between QX of cash quarter XX adjusted of flow last up is reflects free Free which the to million a million,

estimated to was prior Turning to terms. in effect fluctuations the are or between million and compared rate guidance provided the this in exchange full XX% fiscal growth currency to fiscal the year, the fiscal guidance foreign for XXXX the revenue positively impacting at $XXX.X an constant million The in May $XX.X in rates XX% is details, million to be expected $XXX.X million prior $XXX.X year. XXXX by midpoint. Adding

used raise full This year leading of the terms. by our us increase to negatively $X QX is $X.X million currency overachievement of by headwind million. exchange arisen of full foreign million million resulting a year net $XXX.X has our $XXX.X guidance in midpoint our call, midpoint since moving terms rates absolute a up the dollar of in from strength Our million impacted of million is midpoint guidance in we've with in constant that seen in to in coupled $X the being by business the May our midpoint $X.X

year. between points for prior million XX%, the raising XXXX XXX full are $XXX to year. adjusted margin of year our guidance million, up adjusted an which Despite our free a EBITDA reflect from this guidance improvement given the revenue is $XXX.X cash EBITDA as be full $XXX midpoint, has a demonstrating midpoint UK Mimecast resilience. At the of at would improvement $X.X America basis To prior This We to noted guidance. $XXX.X million million confidence a and year, midpoint improvement margin to North of basis XX% The the midpoint, over us of of over a million of to our this free full point fiscal XXXX associated the guidance. in fiscal the over conclude, year of look cash prior with expectations the forward year. at strength range raising our million, the we at We're also and flow is a in-person anticipated prior business the guidance. reflecting remainder costs travel represents represents and $X.X our the flow XXX the events we its return of

customers As focus safe business. our our and continue on teams keeping our to growing

our some and fiscal to their pleased strong I'll for it with Peter are XXXX. start remarks. to turn With back closing We execution that,

Rafe. Thanks,

retention, XX% differentiated revenue, a business leading and and have We recurring a margin. durable high with model industry gross platform

demonstrate quarter profitably. work, customers, expanding of our hard against to innovating innovative to employees capabilities and on this thank results business running the strong threat in advancing thinking to our an landscape and efficiently Our all customers close for want staying our I execution. protect success and our and resilience, best our your

operator, the for questions. Question-and-Answer you Now, line would Session please if open

Instructions]. Thank you. [Operator

Kalia with first Barclays. Our from comes Saket question

Your line is open.

Hey great. Okay, questions for here. my guys, thanks you? taking are How

Yeah, good. Saket. Thanks,

you. thank Fine,

whether any of competitively Hey, great kind bit, recent Does little a competitive out change Microsoft as result bit that you, on love commentary the a offer the with seen stuff zooming quarter. to to the you've on lot Peter, well And proof environment, levels. sense? Maybe I'd a talk just maybe as anything to you about of a changes, points, start of little make competitively. just just particularly would as in touch

Saket. Absolutely,

- to built and obviously franchise. I area has strong progress an that's continue good with, market made where up Proofpoint a begin think we've really So, to make

over structure space, Look, ownership space time, minimum, always creating and Bravo. Thoma yielded think private looked customers. an opportunity, they for have back I respect our in opportunity we've M&A think with opportunities represents with additional further in at to a changes always Mimecast. And conversations I as typically they've to almost us M&A, their at take with prospective our deal M&A for

stories think cyber pans it'll with also threat being landscape. Microsoft heavily the being take what to that out. is some we've the the obviously, lately. Microsoft, I'm I of exploited. vulnerabilities anecdotes and Both an and So there familiar very out how seen of targeted layer targeted time end to been as but identified the all users, Microsoft platform has sure with And how human respect the you're intensifying new

really driving and is these this Microsoft homogenous so scalable mitigate fast out surface top that breed from in we've And And flavor appetite of against of there. a brought threats get some attack on of security so that independent, security depth best organizations defense layered, an single for and highly we able approach. are spreading to really a seen away

Office share our and layer cyber XXX nicely. to the continuing security of platform of resilience certainly we on grow from are top XXX So benefiting customers is Office that that

Meaning, churn Rafe, a net little sort better? for is more of Or helpful. upsell, driving cross talk the Can really up about color which is sell? follow you to bit of perhaps of, improvement? It what's it. maybe revenue retention area driving that sequential Got just a sort was just kind it - That's maybe getting improvement? that great any, see start to again. is sequential Just you. on increase any

of the that, is encouraging. focused on work speaks doing is were with companies thanks on think that sides And seats, from is lines. products and here of equation. And customers. is it so came company split it's in quarter and customers. and customers, extremely our in things XXX% to improved upsell for year Saket. as rate, just actually this taking count The the front pleased seeing there. incredibly coming There's up with those a new both churn XXX% we're buying. the in then last The last we've we churn stronger you're been obviously, our because great seat almost important great of to I some getting with decreased obviously and We we're improvement downsell on good quarter the the that evenly and back also adding to to downsell side, it Yeah, think saw the But us in result, very of really I and seeing they're our along there value some out which that renewals news

signs by helped least our of there. I think that's in obviously paying at macro biggest seeing we're an off And improving markets. environment,

Thanks it. I'll guys. helpful. a in get That's very lot, back queue. Got

you. Thank

Thank you.

from comes Steve question SMBC Koenig next Our with Nikko.

line open. is Your

quarter landscape I architectures, more bit zero Good how you're to trust network I Office wondering with morning. the strong, tangential Or does my integrated for what view changing Thanks broader curious, landscape as want here. as other threat not the and appreciate selling I moving on customers, very - start things security beyond going to motions? of with was the taking guys your as on they little actually, are that the was I security migration question, the you cloud terms cyber affect to well. on is the look seeing recovering the XXX, move at, that. Looks a its vectors? etc., with. to how the also - and you're of Congrats and in changing that, and clouds? Just be curious architectures just

great a that's Yeah, question.

about it So in ways. think I two

security platform, that of And putting us and together? my huge architecture in integrations. the our customer broader a our with fit does area this is how API a with investment costs Firstly, for been has

things integrating and that out incident capabilities organizations workflow customers Compliance uses, as products, improve SOC by our today, products a with by help architecture, our that over box use certain with build E-Discovery. that and of automation, security leading And have also that other environments. really gather, technology. other intelligence connecting threat as the They response like of capabilities products these we they So actual our industry we SIEM security with and as stronger as with direction integrations tools them these XX, intelligence well gather, threat security a well variety and for

we're conjunction robust security the XDR the partnership architecture, in with customers of a And, our just a in of with build new So announcing them. and their Exabeam us rest Black at Alliance in up formulation with to integration today connecting we're Hat, and fact, conjunction product. increasingly seeing the

really exciting. that's So

I the think sort trust and that. way messaging email second in of is through a what's the cuts of architecture, interesting sort thing really zero that all

So to the can by trust approaches attack communicate reduce definition, that zero network use open while world. you surface, email messaging systems and secure can to must and the remain you with outside access so

for And technology tracking messages inside make layers important bring so of and organization sure an that threats way internal traffic, be email organization, is clean we not if messaging for those the the have really that moving trusting and organizations it inside interrogate historically, is might that today. like, used looking email, essentially to to then might you laterally one and safe how and are the

the solution and must because to it communicate problem, be simple with no there's networking open security email an to outside messaging port world. So simply the

Great. Thanks congrats for again. and the color Peter,

you. Thank

you. Thank

Hedberg Our Markets. question Capital RBC with comes from Matt next

open. is line Your

can start are impacted verticals historically? to Hedberg. from buying those specifically start heavily those seeing more deal from or seen that Matt the for pandemic? year customers talking the versus out with you've overall And Are this customers environment about what modules you growth. emerged on for demand the trends group strong COVID, initial Peter, on of were by coming as how the pandemic? adopting Anushka fiscal is by Congratulations you accelerating this Hey, the

great Yeah, question.

buying with number X.X, much factors growth customer customers but upsell very of perspective value, per - the as an increase products, our average purchasing So in a well that as of products existing more quarter X.X, and had customers, from average which from we've see up additional can in customers to order really our strong of reflects modules. couple a

seeing, economic recovery the those pandemic. some particularly been particularly - impacted I think are by that and UK the sectors, we all during COVID US across across confidence in have

base customers so we're not that our good feel to hire rebound the from and buy aggregate, and in We with really entirely little in continuing off bit it products from more side us. and more now XX,XXX lagging. recovery other and of modules adopt our to some of of Obviously, And a represents there. markets, the the staff they pandemic seeing strong a coming back is demand are continue additional a customers, us. as And we're

Very helpful. you. Thank

you. Thank

comes Jonathan Our Ruykhaver next Baird. with question from

is open. line Your

Yes. Good morning.

could wondering what talk about little noting? So Mimecast just how platform? else you worth I'm and to if thinking exactly be anything that a monetization more And should CyberGraph, bit brings the about we

Yeah, Jonathan. Thanks, great.

which leverages CyberGraph, graph way good communication is essentially, So what of the many, looks learning. in normal in technology it communication. baselines it that many sense and of a works using machine CyberGraph database variables like, different builds rich quite And traffic

the abnormalities the as messages, we baseline. Looking leverage we as deep well that as that, inside evolves make as and patterns, decisions. deviations those metadata, - see the of normal to occur then And to sort in in security

dynamically the with share informed One across contextual pieces help and clients, those information mobile user decisions. inside of message, the desktop them the cool can some things mail end It about it is it of insights. can make share and of across those

with. may feel someone even person be for know, them display with before, communicated the never example, same name familiar as they're Let if - person that this they they've that using

in can with appears blocked in know. particular how, details, a We communication a making change that may a an out some let place, flag let them them we have would the changed, they email if and around involve chain, and out imagine you but as may example, flag blocked of know. first So well bank we - that as and payment,

message. with potential this You with a problem is this this this - know, is

From X% maybe a under module. I billable of highly depth AOV, phishing is of of may business customers provides Today payload, new gone a today. our in some $XX,XXX see very brand strategy really module one seeing introduced attack. additionally it. to of for that advanced the particular it. for think which is to attacks customers. these a this up up kind at email paying our you looking really are is it and view, that And we've compromise not a of it year-over-year, still so it We're can or to additional a initially or monetization development, interest targeted but and The growth contain monetization lot some point it been, contributors in has And malware has

we'll like And towards contribute with overall, as more that customer the so what with deeply is, base CyberGraph, our in see continue CyberGraph and it - penetrate to what coming quarters. we motion modules the the potential

which Peter, Is just be you premium broad something version it suggested? potentially drive current has I across it module, offerings offerings applicability provide. or it of the different a sounds what can you that one your like think this will is

early question. yeah, with great It's that's the product. a So,

So look of approached of introduction price get new initially to the premium we the to that And and of then way of that capabilities product. edition value, customer motion over adjacent module, we've we've sort it release. modules time, of it. introduction around discrete common a sort premium And as a typically sense a points over time reasonably is that a with we followed of of into the our incorporate that's may highly sort offer

how question. a how how So at the yeah, that's adoption. things about drive think we travel through And look time, greater that's these we it, and exactly right and

helpful. Thanks, That's Peter.

Thank you.

Terry with Our Tillman next question Truist. comes from

open. is line Your

much so this taking Milligan Terry. the for is Thanks guys, question. Hey John for

benefits the from organization. as in marketing in bit the the there product the into well from release, team, point more delve coming building out these more of an You've strengthening And the about press integrated efforts? the you benefits areas? from both vantage little well prepared as mentioned as this quarters is as remarks Could a

right. That's absolutely. Yeah,

inside So organization. changes new our evolutions brand and are these

looking to benefits going the So forward. we're

a from leading enterprise. strong enterprise. our revenues organizations the from space at, the think, behind to I started and build security to marketing build of in organization seats. in above opportunity that market to we've on base a for in mid-market. resilience franchise brand perspective, we of and and really a an the market real provider end market So as some we're higher the is who have and that or a benefits that strong cyber And built our we perception the referenceable represents, of XXXX that a - thinking capitalize see, And the SMB And with positioning you starting strength in emerging the really if look XX% of now the changes, Mimecast enterprise

and think there's on upside team us marketing the focused there real that. for I So is

into cyber continue innovation, all handful obviously, well leading scale, industry how at we our has of channel defenses impact the joined their and for bring can global to on just product of marketing together. operations is our for perspective, usual and engineering organization, our a more we marketing capitalizing perspective, product and even building super and new capabilities as that our spoken And customers, organization. accelerate and quite and about closer architecture, customers true from his to a David an looking team the how digital from experience into organization we some looking through that that And this And shape really we've to multi-product a leverage That weeks improving better future. and at those too, how better new about growth a security the those marketing us dimensions into organization. capabilities out at synergies excited platform of the support As brought out behind built. as - groups we the of role, even we're perspective, integrated and create and thinking we've terrific multi-tenant, this a our bit

Thanks so much.

Thank you.

from with comes Nehal question next Northland Chokshi Our Capital.

open. is line Your

to cost the results. for put what's curve? rate being That in the is quarter Thank effect down quarter, guidance a you getting growth you. up on year-over-year in for effective largest Congratulations that explanation growth currency rate. and XX% on year-over-year of the of thank said, XX% and cost currency here XX% strong on next the you sort step And did you're same to the that

question. for you thank the Yeah,

think, things last the know, way I the that is one about, of talked is quarters, largely because our the of XX% over So, recognized, revenue couple of we our deferred. is you revenue remember,

a contract revenue we have be when that around even going year. So recognized over life, typically to a is quarter, the great

delay. And so you this get

out, the So full this Again, perfectly we our with at is that the guidance where of year is first quarter play, our would aligned quarter point really XX% U-shape talked next we come XX%. that about both guidance. recovery. see few to last I And into

execute us really U about reacceleration. to shaped we're So recovery talking and we as for I think continue that establishing positioning

is I of your of that, question. one part so Now, all think,

QX actually me, in importing implementations we how that Another in part just, is really this we of look bit. kinds And quite the it quite happened happened quarter. lot was a That my to of the on quarter, as enough look a QX actually those we're quarter. prepared excuse quarter doing a we or in came good early quarter, couple QX. of is and from earlier in where helped we archiving The a And about the of it UK. of things next prior data the solution, forward, saw mentioned as also, in things in strength into linearity there's strong, I it and remarks helpful, the

And it's perhaps of the few that of normally year, a so a makes only little of higher X% bit a kind of one-off Even some full we expect though than had, that, of $XXX,XXX difference. you'd income.

a number of million So things is here real million raised important of quarter. That's recall, coming $X.X recognition, raise. the constant for came $X but back we up we had, where strong our a got that us thing a the year. I bookings currency good QX of I really think, forth, constant that last revenue the rest performance, on in the set currency

So it's where had its business row just we the hoped. out two And like, playing that's, strengthen. it's in you're seeing the I think quarters as

you. thank Right,

mean trended QX? got business fiscal Does that you has here. as current to follow the a up that in somewhere in what Just the QX strengthen

Yeah.

close a to about So we're North take one we're to seeing strong doing yeah, in feel - into did we up again, guidance. UK, the for we're something Obviously, that's month QX. good quarter. we America, we're for that But in particularly strong account, and start the our the the strength, it, that as start

helped $X that million raise. also that currency So constant confidence with that for

thank congrats you quarter. and great very on much, Great,

you. Thank

you. Thank

Trebnick with Our next Colliers. comes question Catharine from

open. Your is line

you on talked staff expertise were up of were about level had get I replace I of to higher that reiterate, last it, was if to - a looking and and you congratulations SMB. re-staffing about quarter on bringing couple more you last focused but the talking - I quarter, the a Oh, you're missed Could quarter. just how nice the for sales a call client in

plan question. are doing part place have How's staffing what you up you better you're the maintain type place to at I to believe and So And of you still in to even in do have the or new it's how your a after come guys do going staffing getting two market, though are to automation then go of put moving automation. looking put Thanks. to you market, or it in, gals? or SMB part a job in trying through

thanks, Catherine. Yeah,

spot You're everyone's making sure alive. and on just

we that that did our initiatives investing we've focused of to We're that that We're growth strategic a in make our shared. number that a on restructuring strength with in trying focused the opportunity. out where much strategic have in job in really seeing very, see talk has deploying know, there sure people openings out actually for on line if You the we're also investing called as about to economy, we're shift that go - very with increased. a you'll to resources initiatives. we you are website, And we're line

I say I front. on So we're would making happening. are both that think things good progress

out talented many getting, does And excited how is job competitive America, case. I people about the companies protects pure story. excited now. that's it some Definitely the like But also think, Mimecast think they're really but being we're I and market the of North Mimecast certainly of customers, part about right us. joining there, what in

there, we So great progress have those do openings.

people that referrals have. any welcome we might So

are can And is, second a Now, but number have where projects question them on of can we and of dear areas to to one improve and already about guy's finance really efficiency. of the we the first automate of in produce we we're part near how the channel heart of MSPs. starting vis-à-vis our the course and automation focused your underway, benefit the and some is drive particular,

making I transact the and think us, lot drive reach a that's a it for to it further making with automated. so easier ecosystem Mimecast, of which around them will great growth, to enable more the opportunity customers

We the - at we as the to we growth to drive really not that you now. are efforts primary go dollars. a if how billion with reflect about do in have start can those the of launch kind in them into we, frankly, that. larger top upgrade and everything this in channel detailed the we think of we list but we the easier to modernize much where just cycle, where of end will, All and it, in our looking organization quote-to-cash we're make long a systems are And

All right, thank you.

you. Thank

Needham question with and Henderson from Our comes next Alex Company.

Your line open. is

really very I to go you thank was that earlier, architectural question Great, think wanted to back much. the I it's raised critical.

strategically of against become platform landscape Can in differentiation that looming that your competitive to a of my and platform of we building become talk world, wars, as any the go. strategy, opinion, API's more about get your you more competitive resilient this base out characteristic much lot move spent calling the you It time is, to - the native we've your three years, than important, competitors. a of You've for It from in the truly like seems been integration of platform architecture. micro-services defining your cloud context? the the your

Yeah, key point. it's a

called quite us we breadth these that can So, all and architecture integrations of of have. the own use and and to product really across where provide us we're is at our obviously, accelerate developers, to developers, able of experience, deliver easily where easy to helped features a this products, with integration does developers to that's our be build the advantages because do other And functions integrations. by consistent, partners vendors, really

without customers. having think, find either build can competitors that provide to to that, competitive from standpoint, or themselves additional I other acquire a to have they solutions

opposed to customers choice, value is which our down limited products other get the customers landscape. much and interoperate have, So choice, to as threat security the of with choosing, of sort products that and are strategy messaging less that platforms or out the the email expand and really they work

a is strengthen of several an sort security, opportunity something fence and that going enable of an attack just and products or of that plugging if additional strategic messaging think you out their consumed translate security of intense it's or a email, intelligence of contributor And the to architecture. to and attack other other what the on to up into extract really, as So that or gap about not telemetry overall that can parts putting a value can aspect. of hole way sort But email in and think about architecture, be starts interesting to environment, be over their other such threat surface that surface. and really parts can by a customers plugging it's

being which really of XX,XXX at to the today. having and that really and, bring architecture kind so expensive of do really to out to handcraft can able to an scale, approach integrations, does for that require this reach instantly, available the in strategy technically, organizations that's perhaps so customers as opposed is majority consultancy And of be

and provides designed quick out and So easy providing and yeah. really what making this is really we of the for, it box the architecture what

the customers quarter has I is a accelerated as forth, the course it the that and headlights opposed to words, that starting and highest slide transition of a actually rearview you it's is not I to - of so course the mirror? month, the If over a demand, In thing to in see that the it in actually, rehire has the month quarter? linear could over rebound of other assume second the the rate as in month that improved question, you're to mentioned

- I think are that it case. think improving goes the picking up along. I as Yeah, is It's things like, absolutely as that that

of quarter. one the the there, business out the company do third month of software like, to the bulk should is, in every our just think I unfortunately, tend we caution we thing

opportunities renewals to that and have So you tends big that. be for where

out seeing hiring, to going right? lot that a drives that data, seats that it's companies that, across And quarter. I we're there that's But of skew to mean, additional the my and say So that certainly, might that out retention us help around be net that story revenue of the moving and steam beyond metric. up see part will as continue big rate a hopefully picking America, world, the and we North that improving to especially on

you. thank Great,

you. Thank

with Our comes Essex question from Brian Goldman next Sachs.

line open. Your is

taking for little up sort Great, how Peter, in follow with Vimeo Exabeam. And question. terms thank dig Maybe of you're if partnering bit. some commentary on, of you and we that a you. XDR could that just morning, thank Good around And and is had platforms, to into the little technically the relationships, does into much those require those background there And raw more platforms? on evolving? work a nature complex how this are something than ingestion maybe how providing data of your relationships better for understand you end? those

a that's question. great Yeah,

of to a then terms is part it. there And component exchange data of there the automation are that also and So solution. are hooks in

And so, time. evolve and developed and over these things

right we've And by So now. first got the our obviously, CrowdStrike out integration Humio integration in This owned family. another CrowdStrike. is

channel we our too. on based partners, little a How and with more quite customers, our this is with really it's bit capitalize how - this CrowdStrike interesting, broad So, too.

these from different talk activities, to customers, many sales our of to partners in go-to-market have sell quite between integrations, go-to-market solutions interesting one and really with building our then we're and to vendors. other work that channel perspective, with organizations cases, these the educational channel partners in see that joint together each take have and available and our the So collaborations we're field, that a customers able helps solutions to events, think organizations And activity them. the sales these promotional I do of stronger that are and

continue these the use brings bring we'll into get the and So them initially support them we value cases the bullish evolve partnerships develop deployed different that and customers. we're to as And field. together, they that to technology on very these that

it, And up for a quick follow Rafe. maybe just Got helpful. that's

Just spike noticed the in R&D.

the little a for the about on the initiatives there think and I spending but a development of of side, you terms talked detail year. more in expectations bit bit little maybe remainder

Yeah, now, that's out. a call good

pandemic the to of around prioritizing our be begin side. investment just one the things with, throughout product we So, to have continued

transition of almost, in has ago, executives with it. on But quarter you accelerate next But year, there, joining there. that an GAAP that advisory that capacity. frankly, until that's of be on April a executive see are taken both is that out. for advisory costs calling accounting in all they're you'll in So the of the capacity. this that's responsibility think, terms, primary side, David for you're conservatively back know, And this in really the one-time worth some the would some also, this, into there I of transitioning the two that into quarter. item with over and that the going as announced quarter a part seeing That's particularly retained hiring in we And

it's so the the out accelerated you compensation then of that of have about see it's into is QX. been that non-GAAP, piece million about spread of accelerates side, on otherwise year there. it, would OpEx which that of stock-based And $XXX,XXX $X.X And

in down up costs or on it'll if normalize full drop without pump So those a it'll normalized. you're you it look QX, seeing but well at year quite basis, that it's

very follow you Thank helpful. much the super the up That's for and congrats on results.

Yeah, thank you.

from Jefferies. comes question next with Our Brent Phil

is line Your open.

driven you then proxy guys, going cross Hey, the appreciate we or Really AOV more Brent. could Rafe think the as it you starting is the you, up can digits? should digits, how talk if we by maybe And get Joe double about seats on for have sell? you or forward the with move single high levers, about question. up is market

good very a yeah, Oh, question.

a nailing we is out. of big you're our look think This story, part I it. as

digits, deals double driving internally, that biggest a that up really tell that now year. move $XX,XXX, where a components initiatives number a key we it with pleased XX obviously So exciting. that a also on of about you of build I is will so think both X% that's piece is. with are for maturity, our up door it. adds on you say we're to is designed just or up But up. number there. I corporate our opportunities, which easy well AOV and showing that knocking whether pushing last new the both as benefits a customers, as All upsell have the market, fact But as quite And have from products out to bigger to of AOV customer bigger multitude we're right? taken then At constant of that I lot increases sales, of currency We're and we're think notice, bigger we

like East maybe And traffic open for to in West great teams ever lot you've that up then the year acquired category? Mimecast And help kind of we products that a Does network. you've hear. talked anything internal defending see That's in and messaging Does that kind into about capacity? you, last opportunity the more for today, Peter, in slack? that of would weave

interrogate Yeah, Obviously, interrogate emerging with within we got connections, and that do as remediate environments covers, from and systems. see help under and the API the we threads, that those threats technology as an do lot can can email, opportunity. we've of those using a

there's we've a compliance that in an and think I about. also, that that space opportunity spoken archiving

the that some yeah, So out be things of look quarters for the we'll in there. and I would months coming doing

Great to hear. Thanks, guys.

Keith Bank from Montreal. comes question with next Our Bachman of

open. Your line is

two Good questions. morning,

Peter. think you gets that what bit XXX% So do I'd of the follow trends end just in for be? about to kind year? a Rafe ask on could time, talk will First, up XXX%, you a And of interest you you to you a retention is, by back it the my little think level did of

you're about XX new what the You you're technology you moving understand trying a outcomes of talked your to I'm now, products leadership, expanding that. think architecture. be may to

be of at of been per could it if And services, about things. But services? of grown does if a about in materially the different think the services, particular, you to you steady fairly increase use number think tend I few so a number the thought And number it clip. customer, it's

these of quarter, of X.X. changes will it number think said up do which itself investors rate you and I me. the how think of X.X technology That's he this for is how of it? services? adoption you. Or it manifest growth Does change will those Thank all view

Yeah, thanks, Keith.

we're quarter tend pleased probably the retention So that best does side, re-accelerate. to building it to and see starting say slowly. really on four Remembering move stabilized trailing to metric, number is it. the the back way start it revenue now They're to is net

I from and has to exactly economies - I in global everything arc back that But can recover give taught us variables how in all the one on predict right is the because, really are towards XXX% we think the to don't that key is doing right put think when, numbers the some number. in believe So, improving we to we're that on drive based continuing really to economy, up on used be number XXX% that And the building there. products, I'm that will to and, direction. us, on sales really part, going back and guidance us this COVID more And situation focused is the that number. for build thing, opportunities successful, it's an to focused upsell providing hard to us. back the historic been we team we it's

to number doing. I coming up. proud more is work customers think taking really that building value our the continuing and And the that we're care recipe team to for the of So of of is offer, have together, all right

built value this also so multi-tenant of for sum but for on the Yeah, that go your creating get architecture, this question, has us parts to as customers. equation we some use, the obviously a simpler, we obviously, operational from Keith easier built just And benefits a to the considerable foundation platform. than multi-product, touch greater

we about that's XX the talk expanded portfolio in products steadily. and Now

about products. we years was public I came when five and ago, bit seven a think it

added during we've added, those products we've that So time.

to whereas one and But it's that don't contribute tend always up increase value. order as may an modules specific towards products things be in the think be modules those additional thing of that, some will now now I it's we've some XX, capabilities “Okay, is introduced to say, additional additional of average the these and XX.” increment note monetizable, sort of

supported So year-over-year the by the not you that additional AOV monetization within to in base opportunity is may constant see Year-over-year shift. $XX,XXX, X% X.X to growth that necessarily X.X currency that

more about stay customers with products stickier. also become products, the platform we the today, I but is that we've actually products, I also retention products more of seen using customers - asked you and of second interesting customers really so longer tend ago more four our to other think our as it's of rate, they're than because of they're have, they nature accretive. as XX% with us have rates, have think And the with margin more a customers consuming, we thing using

five is, three And delivering gross more have as marginally over six our margins costs platform or climbed with different. so two, of very you've seen as products time that the customers underlying effect or well, because products, adopting

of of key this a - customer part as and is that economic scale nicely we've so base seen and the engine And strategy, we've out. the that play business our built and we as out

team. Thanks, great. Okay,

I'd Thank closing to to at you, further there and this the are like remarks. for Peter back Bauer no time, questions turn call

presenting Well, our about first a the terrific us you. thanks hope and time. day we for QX you We results rest call. to you have forward of our for joining again three earnings in look Thank to around months'

This concludes today's conference call. Thank you for participating.

may You now disconnect.