Couchbase (BASE) 4 Sep 242025 Q2 Earnings call transcript

Greetings, and welcome to the Couchbase Second Quarter 2025 Earnings Conference Call. [Operator Instructions].

As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Edward Parker at ICR. Thank you.

begin. may You

welcome and Second XXXX Quarter Good to Call. Earnings afternoon, Couchbase

announced discussing closed press be will in today. the market We the results our after release issued

With Matt and Henry. me Chair, CFO, and Greg CEO, are Couchbase's Cain; President

call representing financial and trends our condition, guidance financial expected and Today's statements be our business and product as future views at market of only relied business our upon contain and reflect not our which as and forward-looking include update will these financial date, undertake concerning statements These size, subsequent statements. periods. future not any views to strategies, and capabilities, statements, any performance for today do and should we duty

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

discussion on XX-K, of to please results, factors SEC. release and recent risks our with filed and our in press material on refer affect could the the today's Form other most that quarterly report For report important Form actual XX-Q the discussed risks a annual

Relations the to GAAP well releases, discuss how of financial are in non-GAAP not we measures these which press which are other A directly website. most with Investor certain in as available accounting these we also accordance During measures, prepared reconciliation generally earnings and metrics metrics financial non-GAAP financial accepted will measures on comparable our the call, principles. included define as our is

me let turn over Matt. that, With call to the

business, our Capella ARR customer continued logo on full-year efficiency, we delivering new Thank I'm the strong to and across on made organization. new you, leverage pleased QX, that strong report and progress meaningful mix, objectives, consumption Edward, in our and progress everyone. in good excellent growth, and growth growth, afternoon,

range. XX% and high high constant midpoint above the guidance $XX.X range. end of $X.X also up XX% Annual negative in operating of million, points guidance our implied recurring Revenue XX% Non-GAAP representing second the was a our or operating margin $XXX was end currency. million, operating and in quarter above the year-over-year million, in at of ARR, year-over-year of up was percentage revenue, loss above QX margin the guidance X.X X%,

in logos, XX our and customer points last added additional on-demand net sequentially. XX QX from new include change total not of made and added XX now our of XXXX in up including ARR, our to second quarter, XX X fiscal quarter represents XX% the XX.X% customers in from due to up of customers. Capella methodology We base both the

I've year-over-year. aspects macroeconomic Driving the all go-to-market, of XXXX. for will operations our to priorities our highest one continue QX I'm Over discussed points the XX of operational what challenging a a the several building efficiency rigor continues of balance this R&D, of with quarter team execution fiscal be the on we've improving across be proud strong in entire quarters, of environment. Couchbase second efficiency. our front XX efforts in that progress score leverage Rule made across improve result seen We past our the and further business our to and of to as of

We a we to retail, ARR strong QX, our manufacturing, and technology industries, continue Capella and and services, consumption history. and across a mid-X-figure care, health new in largest uptake land, migrations nicely. customers Customer new Capella including In financial existing and new and the Capella and travel logo wins of new grow additions, of growth across saw including variety hospitality. communications, strong customer saw gross

slipped our hard half closed from of work significant thanks the deals of strategic have the all successfully Our continues strong pipeline of are teams, large the And to we to expand, a go-to-market very of that and to opportunities we well-positioned QX. year. second

quarters ARR quarter, in We to delivered new disproportionately of toward strong as an ARR is a one discussed so down-sell, and which, a weighted company best our the the performance we pool, headwind I were do in the last to renewal able history, of despite the unanticipated back and QX. year. resulted execution of Offsetting half which was in customer higher loss level gross

experienced and we quarter, in we down-sell any QX to While given some was what normally more concentrated experience. the higher and churn impact than

to progress however, outlook was next of applications. of generation gives diversity we a across this and the participating will in in accounts reflected confidence multiyear moments, where have full-year support these strong we our more strategic to detail achieve a Not in making discuss are quarter's large in enterprise in objectives. Greg our we our opportunities results, us the of visibility scale, number significant initiatives size, few are but with ability the the

Our continue growing to platform. commitment customers to the demonstrate Couchbase a

application building solutions and clear their to next And AI to data participating As across in projects strategic long-term we value demands rich, our base, the an to meet focused of that are application becoming are enterprises of the our the failing number demand on and hyper-personalized, for support requirements. and infrastructure and alternative proposition looking witnessing to AI increasing many of our applications we're evaluating, becoming customers' real-time tenets accelerates, core of phase their more the relevant. parallel, believe architecting, roadmap. customer In scale it's support infrastructure approaches only next-generation and

applications, on-premise Capella, at platform was our while so the to the between. easy-to-use to way foundation time, cloud with an for to the to deployment the platform combine familiar and same rapidly edge of uncompromising services. most new enhancing do our models modern and the intentionally delivering and be We've and deliberately in built mission-critical with flexibility of everything from in and And with Couchbase the performance scalable flexible architected usage we introduction database. world's performance

build endeavor connected Internet siloed proprietary in we way. data and more data the are disparate applications, structured from ever-increasing enterprises the a enterprise it's will seeing or data unstructured broad-based low This highly data, become combine only volumes extremely sources, performant As to need to and or latency adaptive next need urgent. of generation the of traditionally whether with

by this a to other continues developers, architectural strategy go-to-market by by focused architects, system low enabled that our on stakeholders broad complemented market. and target across large motion Our and our foundation driven Capella cases range be on focused supports and use It's of key workloads enterprise the TCO of moment. our seizing

Now product specifics. turning to

continuously extending to are and We that purposely features services developers capabilities of to with advance next-generation our platform the applications. new designed build are

in general and mobile availability quarter, at This the businesses applications on which it announced search, offer search the possible to Couchbase with Vector hybrid makes of similarity their mobile and edge. for we

free environment, evaluate to have developer products and access, learn, without they which empowers into and new tier, time simplicity Couchbase. features production-ready We now the as and also next-generation production. perpetual applications free introduced Developers developers deploy on Capella to develop develop explore applications and Capella test convenience a on constraints

of This GA the platform. to during quarter. Capella and on innovation operational of a unify all top we single our Columnar empowers this, powerful customers On analytical workloads

lowers accelerates journeys. Our positioning their approach foundation a market, strong with customers reduces to complexity, our time and transformation TCO, in AI-driven

rigid As flow due architectural and teams latency, growing introduces scale by This IT on obstacles severely the modern rigid legacy write-backs, real-time which at critical and aiming being performance real-time data-driven environments. Overcoming tasks these limitations Couchbase harness semi-structured the organizations The potential inefficiencies of productivity columnar; impacts the and real-time. application ETL for to systems. is like in formats JSON, operations, architected of higher-performance constrained is applications data challenges. and organizations eliminates relational these format, face to built in today's of of full through its their is to and crucial are systems. disrupting innovative increasingly operational complicated intentionally solve impedes data challenges data outdated

for real-time agile, enabling for is We customers personalized, applications enterprises seamlessly the believe and cost-effective deliver strategy strongly of more the to to Our operational application approach paves data rapidly the accelerating. real-time where insights AI-driven way with demand this aligns our AI-powered agendas with analytics, integrate solutions.

Columnar advanced achievement various from our Capella integrating QX with simplify in early developers and further to by significant we enterprises across environments. a for Capella operational directly us, the fast the share and underscores effortlessly strong adoption see the combining both market from operational in the positive search saw customers I Vector users This thrilled industries. and analytics enable feedback am unified And that cloud that value reliable is to response their adaptive with cloud costs, directly edge. to put to with create of hands and Columnar capabilities power advanced reduce scale operations, analytical database platform, transformative applications

inner-day with A resonate company in transparency to reporting ability strategy and hub. service their were to its it confidence customer We clients, data base. full new is including Capella commercial providing in in enable customer client that detail financial selected service us QX our see gives to What power transaction reporting precision reporting greater to that growing we is availability. because of chose a and continue our our its Capella

edge was this entertainment selected database would compelling of aviation This power an and and requiring logo company component business-critical content capabilities. solutions new provide Another a mobile Capella aerospace and provides system. at flexibility entertainment to management airlines, the performance that with Couchbase in-flight that offering to communication the scale its quarter in-flight manufacturing because customer of

expansion. to Turning

retail in migrating Capella system, to global Aptos operational Capella infrastructure This for in and easier deployment reduce commerce selected to mobile improve continue its of while able invest Couchbase and was first point-of-sale for expanded supporting originally has database administration. and Capella in capabilities offline reducing its its to to a by products unified new costs features solutions, ONE. continued leader quarter, Aptos, Aptos and investment efficiencies cloud-native and

is This to in and application deliver expand Toyota's automobile expansion needs. its advantage. customer clients' to Capella to trading because comprehensive its of Capella Motor. experience from Astra an customer Capella came investment an leveraging mobile decided serve performance will of company, Another This application Toyota all end-to-end improve

application capabilities, off-line needing solution offline leader by representatives, also expanded this and again global a to convenience beverages its database customer with flexibility, in Couchbase foods space quarter. and of functionality for Initially process superior expanded field a available The investment the transactions. of high Couchbase our because used first ability sales this database's their number with

bring ISV, an with that to of large force strategy a had be new sales to we logos component significant of We also ISVs proposition motion relationship continue the the multiplier customers. a in be our a can important reinforces and number contributed existing a Partner-led to which and our quarter. value new go-to-market key

I'm strong of XX and and Finally, our software demonstrated Josh welcome a his technology as both at Herbert years new Marketing Officer. has companies, roles Chief in he to marketing track excited public private of Over record and of strategy outcomes. aspects be team. have will in and instrumental achieving all Josh world-class marketing thrilled part as leading our execution. to We're strategic our accelerating growth experience Josh's

growth, meaningfully second have pleased across teams and continue across strong in In executed Capella to progress our our delivered model. responded efficiency customer mix, increased how our made with conclusion, priorities, drive and I'm We the Columnar, Capella new strategic launched successfully quarter. our

adaptive increasingly customers are data building growing the addressing and of focused world. prospects Our AI-powered generation on applications next of challenges while an the

foundation this helping customers a applications, mission-critical Couchbase Our architected rests purpose-built strategic is upon a serving partner, platform, to I'm as that honored enable carefully these and navigate journey.

ability accounts our the and key of a business, long-term inclusive substantial exciting the in strategic We fully wins not performance we're provider. our us are forward. pipeline That going where expansions year. opportunities emerging half to operational the are we gives This said, with platform as of net first critical several in new and confidence across making of strategic robust rapid drive ARR satisfied progress

our important other with reinforces in taken delivering dynamic the in levers the business, year. This confidence

enhance work and extend will with do technology trajectory. and tirelessly and support will capabilities leadership, manner increased rule and new new so a efficient of ones, drive dedicated customers and our in We and Capella acquire focus a deliver on our to more adoption a services, XX

to times, problems the we discuss detail. by With I hand our that, to outcomes. said Greg? As hard results over many I'll at Greg driven have customer now attack in more Couchbase, call

our our the business bottom business. for for Matt, Despite new to generation, strong continue quarter, our demand before and strong pleased add, more in ongoing us. aspects platform third at trajectory our financial we line and out all results we macroeconomic confident Thanks, walk Day. achieve detail the the now Analyst quarter and through we I'll XXXX year. our progress thanks, execution see headwinds, logo and across our goals everyone, you made ability remain second our and I'm including top providing joining guidance fiscal quarter of and to performance, our in the for and with objectives laid in

sequentially Total representing ARR range. of $XXX XX% was of and midpoint our million, growth year-over-year at X% guidance the

$XX.X XX.X% million representing our rate. growth a the from XX.X% ARR, our X quarter points second ARR up Foreign ARR, Capella and currency fluctuations XX% of approximately last quarter. headwind added sequentially We to total X-point of with ended up

from business few which among perspective, QX loss strongest As unexpected ending we a quarters Matt mentioned, experienced large balance. a down-sell our was our customers, while ARR from and new impacted

of While a our a the to larger commonality no operations moment, expand of more one confident outlook in specifically, ceasing more and discuss of its these, there is customers. base we that and but to largest following any losses acquisition customer in I'll due our ability entity. note remain detail our by to retain we was our in

Turning to revenue.

year-over-year revenue quarter. was and total quarter last XX% X% Second from million, $XX.X up

remaining year-over-year came professional software sequentially. quarter and also up XX% year-over-year revenue sequentially. revenue was $X.X up The flat million X% Second X% $XX.X million, and from services

additions and driven XXXX logo Our $XXX,XXX down $XXX,XXX, largely the ARR quarter. by per first from our in from QX was the new quarter, second in strong quarter customer down

per our Capella As continues grow decline a or reminder, moderate to as could contribution. ARR customer mix in growth

retention dollar-based to or with net customers customers, increase rate, XXX%. from quarter. We the net exceed Our continues of new NRR, quarter XXX last an exited XX

customer to consistently encouraged our by Our solid XX retention by new logos. growth, count to ability I quarter. logo Capella strong expand continue in ARR grew and be the metrics, Capella

outlook. please our In on count business. We growing of income outperformance on expenses, remainder with discussing statement, and loss are stated, pleased our operating on remain focused once in resulting a basis. efforts the against operations, references non-GAAP of share results front, all otherwise this I'm the that efficiently note unless our again, to

XX.X%. benefiting mix, carries Our was quarter, lower Capella to lower a second-quarter margin This profit services mix, margin. margin and XX.X% gross offset strength which of year XX.X% from last sustained compares from enterprise last gross by inherently QX revenue growing gross and

Exercising priority. continues cost for expense discipline a to and be finding efficiencies opportunities

$XX.X QX. development year. of a fiscal last were Research revenue. ago. XX% from $X.X or million of revenue, marketing were XX% and million is General XX% down efficiency was Like revenue of year This administrative XX% XX% and compared revenue sales QX ours $XX marketing of expenses quarter of in of down Second in sales last to QX increasing expenses and from revenue of XXXX. and XX% or a quarter, or were from expenses million priority of

Operating million stockholders to second year. in was a or was QX negative loss a attributable margin. million negative This XX% compares $X.X for loss per loss of or $X.X $X.X margin last the Net quarter X% common negative million or operating share. operating to of $X.XX

cash, Turning to the balance equivalents investments. sheet. We ended the second quarter with and $XXX.X cash million in short-term

well capitalized We executing against remain long-term continue our to for strategy.

obligations, performance end up XX% QX, million RPO, remaining of Our year-over-year. was $XXX.X or at the

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

negative for average a million negative As $X.X XX.X% factors, cash a flow the second renewal RPO to free was $X.X well fluctuations million. cash experienced was of margin. including a flow Free reminder, our we timing balances in quarter due as changes as cash flow in duration. host negative Operating contract or

free committed cash XXXX. to flow positive for being We fiscal remain

will provide full QX the year guidance XXXX. I our and Now fiscal for

and pleased the As discussed, our we execution strong momentum Matt business QX saw our across are teams. with of in

We Capella growth capabilities, be driver in and our business, continue product expect to important to motion. complemented enhancing for go-to-market our by partner an ecosystem investments

of the and predict. of applications renewals, important previously many on our support have difficult have Capella due As quarterly is the and of we sensitivities and that we ARR, our of timing including an base our sometimes nature large customer reporting enterprises, to to business migrations mission-critical our always element metrics, discussed, the upsells

growth new back and the our to expect opportunities, the pipeline renewal such, given and of year As continue ARR disproportionately be of of towards large net the particular weighted pool to in our half we composition QX.

impact In a I'd ARR to is pronounced addition, on specific prior like having that relative years. our to dynamic mention a outlook more

ARR contribute visibility. the relatively our to deals ARR On have engagements, ARR, pre-contracted can which is our future a of any our nature modest. occasion, given quarter strategic where customer in increasing contracted Typically, we include

which currently both weighting with above. contributing our ARR visibility discussed normal contracted in than ARR new larger and is greater QX, strong of start we to amount have dates net However, a than normal substantially of second-half

carefully Finally, headwinds outlook to and we continue remain on mindful macroeconomic monitor business. the of our their

outlook a visibility a to service variables timing our impact conservatism such, of trends of for as as emerging into as how degree consistent assumes macroeconomic these migration As lack environment as our may account and well as well the for offering. upsell consumption

of $XX.X mind, we year-over-year revenue We million, growth $XXX.X growth in third of ARR the midpoint. at million representing in the expect to $XX.X XX% of total midpoint. year-over-year fiscal for quarter in XXXX, or anticipate to the range XX% factors the million range million these of at $XXX.X With the

non-GAAP $X.X in range expect We million. million negative to the negative loss operating of $X.X

XXXX, For fiscal loss we of overall by year. guidance. outlook while the are momentum our pipeline second revenue and the maintaining year decreasing heading and half the raising full our the operating guidance into ARR business opportunities of We're encouraged our

such, remain our the full-year total at $XXX.X growth XX% the to As in of to We ARR of revenue midpoint. in range confident million expect million $XXX.X we or our achieve ability now guidance. year-over-year

million representing in We in continue ARR range the the that, a and we to loss Operator? I $XXX.X of expect million questions. are at happy $XXX.X range take your to to midpoint. non-GAAP expect XX% million. operating With million, finally, And growth of negative Matt negative to the $XX.X $XX.X

we Matthew -- Instructions] this question Thank RBC. one the [Operator you. from we'll please first time, question-and-answer moment gentlemen, comes And while with questions poll at Hedberg our ladies conduct session and for

said about. talked ARR? I It guess commonality to wanted that. down that to way new wasn't is that sounds kind there net a wanted unexpected like of the to on with the click start I of magnitude think the And I your those. about a you double you really Greg, on Maybe there so and to churn QX

we're we Matt, one went a on because see different down we few and was the a end, particular, at out more surprise than of of sell. is they where Greg. we them, it's little said, a within negotiations, tight direction, knew like just again, bit commonality, called there pretty we pronounced Yes, in Yes, sort there no one little range it -- got, and I it's in we a but were laws we a and call, would look, about very

If X outside. best why one being wanted the And add bit is gross of was of I that little color, go years little we which to to add public, was back offset net than that's a sell in last the the about in. quarter a we how bit ARR good one the down the our and of just ARR loss noted is we company history. Otherwise, which sort slightly felt had we expected, for what by impacted pretty It higher of quarter.

that look lot of about a focus why a is little some like success guys? Matt, And mean, partners. had pipeline wondering, customer sounds seeing and talk how called on have partners seemingly Could then repeatable on on you success the what it some I'm had half of bit especially a you new increasing that from a guys was as I focus like partner highlight, out. And there? the strong That's you the a second we maybe perspective ad and towards helpful. sounded you guess I quite sales adds of for marketing real bit you're you

highlight strategic is And side, logo of dividends. the adds quarter. go-to-market our net several a I'd of on Yes, with the it's paying Matt, aligned initiatives say certainly, XX

to partner Capella we're cover and, course, across business new our of entirety logo pace of made talked motion our is increasing we've and say investments strategic adoption. I'd about, pervasive the we with customers. of and the As that the momentum extends strategic ensure relevance reach increasing accounts, particular

realize partners And to channel providers that types continues think to the differentiated partner I from our has service a and and important hyperscalers with role really the be us. for of our types unique we play platform. ISVs range different

speaks with think We're partners applications. it of the nature new unlocking and next-generation aligning opportunity really strategic I excited about exciting platform, land our with this to strategic

drive time. to I the So benefits to of the with that. from that we increase over think fully And quite only and expect platform we frankly, have the business, it's to momentum continue going

from Our Kasthuri Sachs. comes with Goldman next Rangan question

you're of it. Matt, more this to you always have unstructured I things. data. a play your talked database. explain hearing about databases thoughts I'm can the customers? role with Obviously, was thought your expanded the on But -- get is huge on curious AI Gen to from that columnar structured the side you something

columnar new of understand database doing -- your proactively enablement Gen you customers. still from the the driving about broader from little columnar platform? the with the one Is to Capella net expect you this Because within AI talk or And exactly for bit switch you then ARR growth want QX how base? I a that is Are the database? you, What can the upcoming core that customer that?

source data. and unstructured highlights color in talked structured, quarter let part advancing be me for Kash, enabling developer single the store we columnar and about big announcement are opportunity AI semi-structured that let the me have strategy. play our reach, but platform start of is the and the productivity index of a search that developer talk to in on The our very database, to an role to about of first the view -- truth high-level kind with we

If application relational perspective that definition. by and an JSON you think from about capabilities a JSON ETL analytics surrounding application, are the

us have shattered the write-back have ingest allows complement developers operational and importantly, barrier up for a native data open for application built side. set. to JSON, X analytics JSON analytics ETL provide and to We operational essentially on the This do set for that sources, conversational we critically multiple what

embed an to of into that service application single platform the really truth is and attributes level. really And up strategy technology and of take in AI ingest, that next very but so source bring extension the much be of our is the advancement columnar the AI opens and these capabilities capabilities data applications that it's those to to

getting AI us world GA in customer for reasons, we're since in. feedback the we're for feature those that And as with exceedingly tremendous platform. already pursuit uptake So of living a of the data rest the alongside platform and the strategic the

your question. ARR QX on Kash,

on So been we obviously, QX guided deals, want we've to we will. you contract. giving these for and this where time you QX guide, implied to out build large full doing is guidance, based in years call the year growth is the And and have what within first an now strategic do time we a these we've if over

for couple So a if because we nice last of RPO a Those you we example, like recall, did large had deals. jump very QX, big were multiyear deals.

So there. XX third time. some time want what's the second that on pulled to cases, months -- this in ARR, and of get some in look will is, we context forward, this we is QX the definition resides plus some or our end from getting year quarter based that at give now the kicking and where into have at to of We of

give confidence because have to is we healthy ARR some that the of quarters, in given Some We want that's half particular guidance that can confidence already deliver it's this QX particularly a that that case contracted call there a QX bit to modest implied specifically. X, a it's and outsized. see out is QX that second we amount now that QX in of some the with quarters, amount. the you

with question comes Bracelin next Sandler. Our Piper Brent from

just walk existing through there Obviously, Just a sounds it a new Net of from what this to there into there us through were ever also the like Could migrations drove I of new wanted I that? doubled follow-up. Capella. walk outside more than it a double-click seen. you was some sequentially, you've highest what given Matt, contribution customers? quick customers. lot have drove so strong And just momentum, quarter? ARR, Was

Capella, migrations. well had which and now balanced we've where customer quarter increased are Look, aspects which we And to about. talked XX%. increased now a proving XX.X%. expectations ARR a think you applications as up That's it's We is mix, say all We is I'd Yes. the new out. those of count, as high net combination for have I across that

about talked the single had. also that Capella land We largest ever we've

of developers we're value that And to Capella and quite sizes, for applications so a a the all on the in seeing Couchbase, Customers significant want growth focus lot continues accounts be service, across of world. vector offloading great frankly, building geographies to across management to all and out play us. data

So we anticipate continue. that to this is going

for a Some growth levers migrations. on dependent a normalizing be kind seeing time, us across leading and we significant of positive track indicators expect basis to how going are this nothing those of go-forward aspects lever to of over for be Capella. but pace of we But the of on are all

half what color as what of remind churn be years? in additional color can so of Any year? say, has into you're back turning And the logic been down, then Greg, you about elevated there. just basis? slightly more gross assumption the helpful. think through just last, you're baking there maybe Helpful there then, us walk a X you let's of on the the baking over the go-forward retention would Do And the you business think might be a X,

Brent.

it's additional sell down experienced public levels a company. retention. We in been disclose and that we've anticipating we normalizes. retention really not growth growth don't since a are healthy elevated loss be to you we I enterprise yes, level So the we've ever can And second half. of think tell it

We obviously, renewal closely through very macro, in second gone think what's up what's and and going but looked QX watching closely, at the on with the is in half anomalous, evaluate we've back we're the down healthy and gross that sell of get going -- loss have seeing we've be, retention to there's do been again, anomalous not see that, should rates to we renewal where historically. for

Needham Company. from & Cikos Your Mike next question with comes

if churn customer all they the hoping Couchbase been is I can have see bit know color. customers way just of to kind into we're for a base? any discuss more and these around Or I a were cohorts while? there could around But newer down we get was sell. potentially little the you circling

search, really, is and innovation question from bit with the velocity just you the just the this whether anomaly that as appropriate of a sell. And Vector columnar churn standpoint, sure announced reason counterintuitive this for the and it's an want and recently thinking have down that far just you guys striking at It's just in or GA guys is look as hear product if I about momentum now. to about this And make here to a mobile we're QX.

Matt. this Mike, out. you appreciate this I calling is

take base the we renewal renewal specific Any year health for Let's are the they the base. how account, the database, the renewal many a renewal at enter customer, significant period, how many a have looking study with our Shape, respect time services of our renewal strategic time fiscal up do And that with deployed. for whether with leveraging health with shape deployment our are and really we driver the being the of how applications and base is this. to we obviously, financial accounts a base. we

accounts, just land in strategic accounts. were about with as referred into allocated to sitting give And healthy as often the this seemingly And large and explode to renewal the business coming year, that the is be we've some to perspective model. half true disproportionately on these is half. second about we've to strategic the we a what talked back talking is What large our is proving year's also also base relative upside

course natural quarter accounts of of ARR sell. disproportionate but the predict business, and as in loss that can multiyear that there are meaningful norm be strategic called loss have we which sell. What that certain and is deliver amount more sell, of normal point the of growth. the down accounts of to a the out outside These X-figure business, part our kind we to Offsetting up down a potential couple that transaction of is were very at ARR really as delivered down kind is the in second

the those down was them we we a and have an where that would accounts the for they shut in came quarter What is completely figures were the one strategic of acquisition didn't that offset of that One have late. transact one business into prepared seven that little the that.

at we the year. accounts the accounts And rates, frankly, is the back which execute accounts. And is, of best the we of accounts, at can terms of the size the seen the we're ever derived lose we and number the of on of health of quite confidence our again What the the we look rates, Now quarter and year, renewal as further half upside that our progression has expect enterprise in often the look -- investments. we is in I pipeline big distribution, the reflected year look the those made strategic all expansion of continue. the at come the predictability underpins how to of confidence strategic with of sight fiscal as expansion that our fully the for kind can't that of the of reinforces with one we've makeup business, for our and in The again, geographic entirety, part we've year. kind that that opportunity that in the isn't highlighting strategic

which in math kind So, over by lots and full offset down picture. the good sell, more of we the half, have one-offs strategic and isolated second we believe, visibility the time, completes very converges those opportunities,

And I on. follow-up, just I the if guess could for tack

great next cash positive. hear will the the year be flow that view First, reiteration free to on

the to board line the Just across on shown there. discipline OpEx, every expense in the really check item wanted was double QX in

go-to-market obviously engaging think whether have tapping heavily into with these And to them I'm more you offering incentives. it's guys trying partners, initiatives,

a the Where scale the about contribution to behalf port So, to we guess, over give can deals the should to? the of does just of on think the -- remainder this reminder we I us versus where I partners drum the how is guess, to of beat continuing couch year, base? what today expect you

Look, investments and business, scaled persistent of invested say to I'd has been not has us, It called the outsized and part other we've the ISV our a of and as which spend. What grown align partners activity talked we're But the drive growth level as of investments out Look, but lot on partner efficiency. about a I we out the this we've to. addition. think Capella new on there for we our to slope with because that it's the a haven't foundation logo continues the company. to lead adequate our be an if ability important lever is having out going get committed built point an already Mike, in been to I appropriate great would to a about I more to to more getting or an lot getting leverage. inflection, We of think is is

level Our up, through a the customer on going increasing have from a funnel. teams go-to-market with with as Capella amount them finding that appropriate offering at to never sophistication ability that prospects that, getting is of efficiently market and firing is their they do innovation frankly, and the team quite new platform, our more value efficiently extract

and flow platform in, So, cash frankly, of we're of to for we investing our us. dynamics more efficient by free XX committed extremely market on and matures that able attractive remain And kind do progress. remain as a way rule quite

say factor that. partners the those all into one things I'd being part financial commitments So, and of of

Morgan Our question next with Sanjit comes Stanley. from Singh

go with into dynamics mean of had the churn one with I base. some start question. Maybe the downtown obviously you've higher-level new let

opportunity of of buying also for and source AI. spoken the truth You've about that single

the buying You're AI clearly, for obviously are new a hyperscalers company big not that. And playing the in role applications. only

contextualize could partnership or call your of that meaningful you seeing in just Are terms competitive hyperscalers? out? you're the sort rates your any your win of there also in shift you intensity with So, would what competition but in

on And your then flow. and free second of the question billings cash sort

to highlight as [street] that it to below the expected your deals flow slightly can well. the kind Anything spoke you that You your closing? of from billings QX cash what on -- where slip and Yes, seems free like was drove be.

core have are at architecture then we database build which the Couchbase. for customers and are be than increasingly a find been the with and driven enhanced you'd put going performance, to if that flexibility, and more the opinion, that step I a back need our And relevant. I'll from one moment high are a cloud better start, and very make building we And native point enterprise if and platform it of attributes architecture, hard-pressed enterprise for be what to this AI. I'll the for been define what over attributes, data our they're SQL here my edge never to we've applications, look starting level, turn core in JSON, going compatibility future, we to scale, Look, a about us great: to Greg. myself in think experience, going shoes and and to at the to

And and our enable solve teams out in to to we're other wake to services way up a problems doing and ensure customers have that these applications. be that, we'll customer some in with the cloud cloud, that in providers. And includes from have hybrid it we're of to to going include and enterprise which our relative that's doing some that pride core way with building differentiated successful problems differentiated we solutions with are say compelling the a for been and unique services next offering. there, If we're capabilities we've and enterprise at solving but generation a I'd capabilities that dynamic native deal ourselves that hyperscalers their and edge the don't time, dealing deployments,

other we in same At services cloud, and we their value to relationships within time, and the with market those Capella partner stack. go as their we deploy we really

say an I'd is dynamic. this And so, ongoing

partnership And we to a on the margin, that's say development, level that momentum geographies on particularly the of and is take I'd kind positive. the emerging very competitive I a and day. were dynamics coopetition platform competitive say comment dynamic, every On would I dynamic remains in unchanged, on if

lean appreciate, So, scale, one their that I it's on but that for a it's complicated relationship into we the reasons as you mentioned. just based can

on billings following up free just and flow. Yes, cash the

-- means. business. less are have can the it lumpy. activity, there rebuy than in far measure particularly particular, very business would say, be guided the And we, And we any Capella, side to subscription billings recognize frequent of is metrics, our on can with those. of by with we not the very never It important While best the be less

we've So, we bit cash of can key ones billings metrics. a that's as focus one good to be also people free look us. have revenue lumpy I'd to really RPO and been on But say for our and -- why trying are ARR flow little obviously at.

free minus million. million say will side, I flow, and ago free we of flow a on this $XX $X Although year, at cash were year point, this minus the we're cash

progress the we're feel good about do making there. I So,

comes from Ittai Your Oppenheimer next with & Company. question Kidron

is churn. not customer Not down. to down part comfort? be cases on That's that I the here What of rather that division and What way understand mean other happens. the makes comfortable a execution this decision? coincidence shut sales customer there any associate gives the for execution? got you than I of to dead a of that what this the acquired Is is sales were But you clearly, sales. there issue it just that horse

a I came thing imagine we ones, study big talking about hard. the would doing from detail, were we into account Without the can we one one getting a little of go-to-market were this Ittai, you two leading with pretty we're perspective. appreciate, right indicator that that for that on Well, a that bit prepared -- and that too surprise. The much suggested

talked the call. on yet haven't about We macro

not I cost as we are frankly, some quite where, strategically think pressures play were healthy within deployed account, were there accounts. the in at as we

we're proved not ARR a our thought one have of where happened we it pretty them studied minority hard, of very of beyond to it aware we and we're represents vulnerability, This very, the base. were where And vulnerable. Now true. that be small we to be

that tighten not business stretch that's at see the And of we're And and dynamic any anything a indicative going do by to But so up. the it's we to we I deal there's something think this rest quarterly with look basis. whatsoever. if on need of

time it. These out, why offset the to X just, is a which without of the spending we're strategic played on again, quarter kind deal in them

We I'm we again, from talked QX. don't changes We sales for so year. in with lot about execution. anything learned a think And that. pleased that the it

strategic with And up frankly, things account. the well of were quarter Some us the remains sets into strong year in we're intact. accounts in all the year, really taken strong. fiscal And a from highlights fiscal quite confidence making the really my progress for

delivering to things And from that And us what just gross if just we that's nonissue. one also nearly Yes. the closed it highest of that's on all we that Ittai, achievement was add led is to ARR Matt's out company the why could point, the to QX third slipped, history. a deals I in call

deals was again, ability and our very the So strong. close demand to

As it expecting down away we feel higher range. through middle move what we It's one Matt or have which deal signature quarter... the as versus that good. obviously, net guidance of number being deliver, right closer one the unfortunately, talked we than still we're were about, the But we to where from is we expectations

are $XXX,XXX-plus by clearly, So, close? several a strategic of you long-term way, is a you're mentioned, Is I us your you what deals business, the as you're number projects hope is chasing clearly look qualify this Is also understand -- parameters guess why deals? the of you a potential time such and you as land? contracted us And to to what we're but project? QX, the into near-term of the have the it. definition on What we impact so this that help such large is spending such strategic Can of projects. around much

had us biggest mix world going to for very customers drives are partner, of a be the benefits can multiyear quite exciting us we work how license it going is these us what some -- QX, frankly, for one are many a They so at lot are business. invest of to us the between they're when that mentioned These like call but many, of about decisions We few level, platform companies These say which the projects. transactions complicated, and figuring felt a work across time. exactly the I'd to making in we really hard drive ARR Capella be these, are strategic can talk Ittai, strategic worthwhile. some is And are in a become X-figure we to that to And where plus so and there aligned over out for they financials for our the build of structure as time. and, I've well enterprise them. to strategies. these increases. think X-figure that for true land ARR out

and were those well making of progress beyond on many strategic where planning technical of and So, negotiations kind great and set it's we're that customer accounts up discussions wins.

But strategic be And so, a us back if in them for spend very critical robust and on of didn't because we the we would time they have be are the they remiss we can half. significant how the these in unlock understand us the remind was into potential because us. year that's front I'll which of everyone we of accounts, pipeline value and emphasis coming for have they point of the a

that another thing renewal I'll compelling. renewals because are is one the right to potentially renewals event compelling they deals those Yes. these same point a 'XX strategic in even of our few the category now. majority have large about us the exact deals majority talking fiscal are more early in compelling are don't just call about And getting add that the wouldn't talking talking done. But a of of a renewal I again, large There or Ittai, either have half second that are we're are event. a

or in deals half 'XX fiscal already about the of are something us Some 'XX. doing talk second starting potentially customers to to

Jason question next with Blair. from comes William Ader Our

just year? breakeven think guess the know maybe but possible that you point, Do free on line, year? some you could next could positive but of turn operating operating next flow question next be is, end non-GAAP first I you cash breakeven it's -- think at the could about you by you've I operating income. year, talked positive or that do be late

But at driving committed to flat be we hard I'm do asked, towards can year. no, to you though, really and non-GAAP or op in are for But that. doing see year. to piece the see Day than quarter commitment their full cash that a the Greg. committing Could I'd fiscal for maybe. was Investor to I we're Jason, mean, it's again, certainly we you this that income glad not not flow know. going 'XX you the that positive 'XX free fiscal the expect other back time.

are think questions like their I because what the the people derisked. guidance then heads on feel of it scratching it's And my ARR other some doesn't just I is from just think observation

doesn't new I you didn't And for that QX, also half first feel feel the you about it challenging a year. good why derisked. ARR now had on the you've of the but guidance change explained it's ARR year Just basically think like you

lowering versus guidance was is? it what debate internally on the where keeping So, ARR it

having we've amount Well, I'll analysis always state this that have. comfortable guidance do in information that that predictable multi-quarter approached time. have The and the to look to provided. out which on of a very is boundary over with with happened account feel that the basis. of business, I'd that utmost as the some we've a we Jason, and offset we big we every we we're say accounts that have at expect model the trend we studying fundamentals the fully around the lumpiness out quarterly enterprise leading And very indicator on quarter, of that play in we plays discussion a and When

have layer we which business, don't mirror, of benefits financials throughout we're rearview we that, in have but Capella that On driving on top financial that the is the the top talking highlights about of the it.

And so, Greg we sit understand contracted which material. the which articulated has where is these QX, levers and in ARR,

of wood a wood strategic after, which about. well-earned the don't a feel in of that we cover is of to that look everything conversion unique normal to back calling great have we half the to to all But provides well the chop if we're result. us So, pipeline is within the very seasonality, that pipeline and ranges at quarterly confidence lot balance we opportunities back half, execution, have great gives get have where we the what and of

contracted rates, of entirety So, set we of have kind from again, confidence build enterprise we up rates, when Capella, the the number the back ARR, with fiscal half expansion the layer and business in renewal year. on

just I'd talked weighted pool, in the second add renewal have disproportionately it's we Jason, the obviously, visibility, too, And half. we've and the again, Yes. what's in about,

take of base, of terms together as momentum we from that saying, Capella it back take it internally sort you If for ARR can contracted like of if you renewal well. us we the the expanding The was generating what see can Matt in math of, you ARR and take holds as in again, and -- you fact, out. all well see do as terms from population the the that that

gives So, think very again, ARR we much mass it's the because it could would of confidence contracted that, out. this bit delivered to without that, within looks what we've a how I the And outside historically. call that's that want what amount for but us norm it see the that from why, someone little us, out outsized, that's

that Could you contract, give growth contract? the us of that ARR magnitude in

but we specifically, again, why significant quarter, say out. And we're would in much several calling million dollars. see historical any more I'll than Not again, it which is, it's

next question Barclays. from Our comes Raimo Lenschow with

Two quick questions.

a activity The like first is how that under at with the doesn't sell? one what's seems the it's customers of It Was the kind economic you it's of had is now. rightsizing? of together something I what's overcommitted staying driving But control. all together. So kind driving you deal of they kind about on that it, kind now Like and function and down coming customer, loss, can And also of working then changing all subject, of then commitments? sells we having customer that? what's driving the that future like structure that mention these talked kind just get it down ARR you came and that look QX that's and your

Yes.

how again, timing. this the first flows do based of on This to our business. we it Let me ebbs and structure part ARR. we No, always haven't question. changed generate in deals answer is contracted And

quarters, modest others be be I amount. will will said, a X, like Some

built is I transactions substantial multiyear amounts our Couchbase. the experiencing investment think the are and in into to willing that what's last were with QX, largest of make they're customers they of this X driving we in of that with because growth renewed that just particular, growth

of the those large QX. it's in So that's really only much were the X we extremely accounts had dynamic. last pretty line, Otherwise, driver but

reasons the talked of the that within respect the is was I'd grow. situational one-off feel exception nature of to our don't everything predictable We we've business. very call we've big think with reasons the being But say Raimo, base, our and to and the things strategic for down comfortable norms with those need I much with sell, there's our all it out ability our compete ARR X to the We those that one about. the for talked platform, more of to one planned we've talked than accounts, that about, about.

kind to feel respect is beyond with so There those multi-period we outliers. nothing outlook, confident changed, has in big pattern And no a and year. broader of the X

loss outliers down spin would but will significant. time up I And And sells, in calling the It's the an ones spin and app that that or X customers just X the or were your just are Yes. it. again, ones from very really losses they're large are or sell, We're something losses, were an which Raimo, that they down environment those add to changes that not app was time question, and with the were the this down where driver. the to driving happen losses those quarter. the typically,

question. time one have we And for last

comes next Howard Securities. with Guggenheim question Our Ma from

your point drive for based Greg, just contracted I that thought ARR. is I have back ARR ARR. to you, home on on a question half the definition

higher ARR normal QX, into you reported I but that's than today? the mean, be your in talk mistaken, that start could to be amount I when about back of wouldn't already So ARR contracted

weighted, from new about And you of new, are paid expansions? as that's right, a a AAR related or well. on would talking in the just are net note, there logos, you at expansions, back Or talk amount quickly, is half it the half just being good you back

Howard, start your second Yes. first. I'll with question

back So what's renewals. is half the towards the weighted

than significantly half in larger about into the first talked have We We've in the previously. that that pool we coming half. year. renewal second did the We knew

opportunity an new business. upsell a better that's And at period, to range. plus again, gives experienced, that take rates, that out new quarter. forward. to of the in the us anything the is this we're tend assuming we not just because We But upsell yes, of But within at end why this from a we've ARR XX months higher time upsell we calling are is higher perspective renewal. everything material logos contracted drive It

get deal, years X-year year year beginning year you multiyear have you a do then get the into look you sign and XX may you if So these of values. But during deal, and first X all then when into value. X year X, out months, end And to X, X. take when it look the year that again, of you'll you contracts, different

$X can be So year million. X

be can $X million. X Your

have you deal, you from that $X to and of million growth following still You can know be $X million the up which you the get the signing million depending you're year, at on $X as and pick but well. year million $X in, might you'll

That is the dynamic happening. that's

obviously have So XXX% to It these deals even [indiscernible]. are done. what's impact contracted immediately, going happen. but from in to QX or the sometimes do coming no a more has revenue It's ARR we year

you Thank Matt closing to concludes the comments. and session. now floor Cain hand back for our Q&A that I'll

to forward with operator. you Thank all Thanks, again day. for us. soon. great you speaking joining all Have We look a

may Thank All you. call. This concludes today's parties disconnect. Have good a day.