Splunk (SPLK) 21 Aug 192020 Q2 Earnings call transcript

Company Profile

Participants

Ken Tinsley	Corporate Treasurer & Vice President of Investor Relations
Doug Merritt	President & Chief Executive Officer
Jason Child	Chief Financial Officer
Brad Zelnick	Credit Suisse
Raimo Lenschow	Barclays
John DiFucci	Jefferies
Keith Weiss	Morgan Stanley
Fatima Boolani	UBS
Kash Rangan	Merrill Lynch
Walter Pritchard	Citi
Keith Bachman	BMO
Matt Swanson	RBC Capital Markets
Michael Turits	Raymond James
Brad Reback	Stifel
Gregg Moskowitz	Mizuho
Andrew Nowinski	Piper Jaffray

Call transcript

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Operator

Good day, ladies and gentlemen, and welcome to the Splunk Inc.

Second Quarter 2020 Financial Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions] As a reminder, this conference call is being recorded.

to host like Mr. today’s now would introduce for your conference, I Tinsley, President Vice Treasurer Investor Ken and of Corporate Relations. Mr. Tinsley, you may begin.

Ken Tinsley

available Josh replay are being via the Jason on our Great. the webcast press release today, live you, and This will also With a an on afternoon. call, Thank posted is me we call the issued today following After conference Doug webcast Child. and website. be and which Merritt website. audio market closed good on call is

also note materials supplemental that our Investor have on We been Relations' posted page.

and making On regarding cash products, and statements, announced quarter our close today’s call, customary the of flow, second margin we improvements; operating subject industry. which approval; trends of regulatory and customers, recently and we will our XXXX, closing our fiscal financial in be SignalFx, including and our to efficiency, third expect and fiscal forecasts technologies, expectations expectations of for XXXX, forward-looking expectations, strategy, to statements half market, regarding and operating conditions guidance mix, benefits year full and regarding acquisition including revenue our

actual risks materially. we other actual the on These to our forward-looking refer and known judgment to and may may filed with from events results X-K our Please Form statements. differ Those file documents differ contain statements factors or release. based facts to with documents us the results those including reflect contained best our currently SEC, cause press in today’s that

is these or being not the information to any accurate. statements. are call this current may this of disclaim call presented obligation after today, forward-looking and or made today as reviewed during statements revise we be If update These

which historical on and press discuss accordance also and not release the Accepted of results Accounting our We non-GAAP in measures, website. Principles. non-GAAP GAAP is will in reconciliation A provided prepared financial with Generally are

So, to over Doug. with that, let me turn it

Doug Merritt

and you, Hello welcome. everyone Ken. Thank

growth QX at XX% our XX% continued growth, growth. results revenue scale, growth, revenue of and hyper overall our software our cloud proud extremely are We particularly XX% and

cloud it our and of few to XX% expect years. quarter, this XX% business we fact, grow In was over the next will

tell I'm that SignalFx also today. you acquisition eager of we about the to announced

know, you deals troubled transactions; and acceleration in growth categories market of kinds in consolidation two M&A deals there As are categories.

we the positioning a for value strategic world's mistake proactively no short Splunk on nothing and enterprises. savvy creation. of most to long-term partner Make to are growth technology is become mission data Splunk the

the empathically I Before now where we a acquisition, clear. of be sense get are into give want the we to going. to we're where details you like I'd and

at Our all firing and business on cylinders executing is the highest levels.

little a enterprise in VMware, growth, this the fiscal only year. in is and by to Splunk companies data-driven greater billion shortlist revenue, likes Oracle, the end For context, obtaining $X Salesforce, history than handful XX% while of track Workday. join have on Microsoft, hit the ServiceNow, revenue a of software of

Not a Splunk on and we've model joining done full concurrently, these is technology making business change. elite only while investments executing cloud of massive it in new on the cusp companies,

service. a As you as to consume want know, today software customers

customers a model by just easier percentage XX than terminal business than more do our business fact, it in makes increasing adopted quarter And renewable XX%. newer from in Our expected, to one points mix faster to have with. cloud stunning

data. approach Splunk to We've more easier for also much pricing customers it evolved make our to their of

enterprise meaningfully our worldwide. pricing, pricing big difference to new expands, and Splunkable And making are customers. the data opportunity for contracting Our changes a

grow their IT connect from faster empower favorite such of analytics earn DoorDash as partners merchants merchants it’s dashers is to restaurants, experience their and through with enhance consumers Splunk consumers money users to business team business. Splunk example, all able ops more an a to to DoorDash For dashers Cloud DevOps, to to provide and expansion. to help across

Splunk global global expanded ABB Splunk through entire action program. Group, across ES a digital will who security, take business software technology predictable of new for business to have the significantly Splunk industries, Splunk center. pricing driving with ABB IT security on is leader, of a and transformation selected their large at on use a data A company Cloud and multi-billion security dollar ops, cases. DevSecOps emerging the operation heart

to our Splunk data I'm pricing QX. with also that limits. this throughout much is them utilize Stay gives of that customer pleased tuned predictable no pricing very new from program pricing able for a more

ecosystem global expanded strategic bring will on list. the relationship Splunk differentiated platform our on Cisco global rapidly with flourish. capitalizing kickoff solution that to with integrations to to market which available will and built continues endpoint security week. new newly Cisco's from A sold Also, security is our analytics internal recently Splunk on solutions to Cisco, We relationship, is sales generated featured Cisco's price orderable next be now this be

and Financial incorporates threats. Advisory. now security Offerings also expansion to provides Managed with Fusion relationship clients announced We cyber strategic just response Phantom, evolving jointly Deloitte's Risk address of an automated monitoring Deloitte and Services capabilities our which help

by times of but there less person XXX than be zettabytes will will interact day. device actually with of data, per XX% of half this will security, XXXX, data will require than secure. some connected the and times be Further, According to IDC, today, five a average level nearly more X,XXX

businesses, the strategy to data represents and biggest biggest everything. and governments and is to humanity. simple the Data is to bring threat clear. to future frankly powerful The Splunk's opportunity

source outcomes and we format, from question, new to data to produce action, the at ferocious in every scale. of data stop approaches technology bringing connect and required enabling massive the committed every decision and speed required delivering By most importantly every platform instantly all security threats, data instantly to any forms to are any all

our their in real-time observability centric and application a cloud leader scalable monitoring of is part a As best-in-class, ambitious we massively applications. business at of growth that organizations gives micro-services today and for in SignalFx, us acquire monitoring cloud SignalFx believe, a we metrics performance journey. cloud announced our and us agenda, monitoring SaaS every stage leader cloud and for intent infrastructure, makes to

a combination them matter experience. give order SignalFx in customer data scale, infrastructure data The IT that cut improve and to the or no and unified absorb platform departments costs, monitor developers real-time, in to and and boost the Splunk allows of will revenue application

not our This product growth from of match. them look just impressed for to success company I as We CEO fit lens a our and strategy. team. forward are share SignalFx and though, their is strong and We cultures cloud having team, accelerating the a Rau, customer Founder am Karthik Splunk a part passion incredibly the with

of very are we conclusion, In proud our QX.

cloud. the are We executing in

We are executing on SaaS.

importantly, measurable economic our on delivering and over real for XX,XXX our agenda. customers. Most we executing are technology product are value We global

right approaches to a outcomes, produce data. is the Splunk right delivering new the at all the company make things happen with right the time to

a companies enterprise by we're on of that growing while to As fiscal become result, the $X of XX% of software billion revenue, in in track handful end one a hit of just excess year. our

to in and you thank our your personally to importantly of all our working seeing at most partnership. I .confXX and Las customers, reality. for future forward hard our partners, time to for investors We attention look turn into and Thank people, our want promise the Vegas. you data the

the take to you And to through now, turn I'll Jason quarter. it over

Jason Child

good joining and Appreciate everyone. Doug, afternoon, you us today. Thanks,

especially a we it you indicators our new out site. are best readout for renewable was anticipated. point than Our the be of a IR detailed on QX I line-by-line few thought financials, execution key transition Rather slide a highlighted the than faster would the strong, to that by provide of best which reference that those published highlights, business, on growth can deck a

that note XX QX to it's compared report, results months a of today's to constant important QX reflect duration TCV virtually all year. For last on basis about

up $XX up QX were XX% software the Cloud over revenue XX% and which year-over-year. XX% cloud was total were $XXX of Second million, revenues, And last quarter up $XXX revenues up license is year-over-year. million, year. million,

term Doug were faster In than customers cloud term software are cloud. is or either bookings renewable adopting anticipated and As to XX% transition than planned. tracking our of discussed, faster QX, and

for XX% full We and perpetual renewable will the expect the to year. sales of mix QX elimination high license in XXs accelerate

we shift has cash quarter, timing on the a to accelerated As collections. last previewed renewable impact

negative, translates cloud term more of As as this paid given our cash drag flow expected, are the multi-year year, operating of more This greater contracts and cash flow a ratably. was QX contracts. to rapid growth

and expecting are now flow fiscal cash operating negative XXXX year We negative $XXX net operating expect with cash million current of balance for the the flow.

drivers To this be clear, reduction. are behind two there new

mix to XX% deals First, that FY second paid XX% upfront and And our paid term cloud half XXXX XXXX. upfront to for first XXXX FY the invoicing the of QX second upfront of in significantly expected half reducing XX% by renewable an complete estimated XX% is go our in -- to in from QX. we with essentially and are cash transformation the at

this about all is Again timing.

our the yield the cash long-term levels cloud to there mid-XX% the dependent to expect timing we on years. mix get next term few While, over return to is

the mix been business is expect half introducing will our momentum X years. from much it likely so our to increase of $XXX next just within cloud cloud of adoption currently. accelerate Underlying service. million uptick represent that ago, rapidly constant has overall will increasing Since the Customer grown in cloud for and five of from so we substantial here, million the few ARR cloud years has over

intended new next is QX revenue XX% over of and This year. last RPO RPO XX% we granularity RPO billion quarter last is We a with $XXX XX% up greater to up recognize next disclosure at quarter quarters. which portion up was provide to months from revenue four over XX the its $XXX million, end, over ended total was to expect year-over-year. the of $X.XXX conversion bookings the RPO of QX The of year. million

due XX new Just million about percentage last we and to added greater year. to was customers. understated adjustments orders to X growth XXX In XXX-related QX by recorded rate points bookings RPO than this note, $X

cloud, a gross are XX% XX% up which on growth operating non-GAAP, points than the X% and topline target notably we're margin year-over-year way rapid scale important in performance better investment With which is an optimizations. business. margin was over milestone more. our QX, gross QX plan, margins basis. and our On solid such the our X anticipated cloud in driven long-term XX% QX to that delivered on margin efficiencies overall In realizing was of by or some

$XXX of trajectory million should operating a approximately Turning revenue to with non-GAAP guidance, to margin QX growth XX%. expect reach we continue. high our

the of maintain and acquired year, SignalFx. expense expecting XX%; of our margin For run $X.XX from revenues will confirm, operating to we target $X.X of which non-GAAP total up billion the full are include rate billion we now operating

priority. top was even first myself branding market the rush, about this, of for massive half in a in energized have first here penetrate dynamics and strong our it in and our My understanding with In to quarter complete of transition renewable completion model addition finish and an the the excellent set front the full With the the more outlook about business position we I'm I'm adrenaline us enhanced the the unique been a has closing, here of have excellent. we're year. up been from is to opportunity enthusiastic it, and SignalFx.

questions. With open it that, let's for up

Operator

Thank from Zelnick you. Our first Suisse. [Operator comes Brad Credit question Instructions] with

You may question. your with proceed

Brad Zelnick

you guidance double-click and Great. us And cash make little just for the company a it back from back into heard your deeper I perhaps so bridge cash and given? guidance so Can congrats flow that year? has go you correctly. full much sure the flow just prior over Thank it on great I bit Jason, the quarter.

Jason Child

Sure.

million previously cash full $XXX actually $XXX for have million. positive The we year. is guided So, minus flow guidance to new the

and is -- this why websites reason reduction, slide on happening. a of we included for overview helpful the that so just the of And kind

XX% our what's about X% previously end total of is going is anticipated But said, year. business to at one, previous go be guidance. now was business. which saying to of That to happening was renewable We're We the XX%. perpetual renewables by the

Doug Merritt

Perpetual.

Jason Child

I'm will the end by X% be perpetual sorry year. of

up So, is -- know, in front. is cash that as you the may perpetual, paid

just shy TCV, year going So, billion, on a if million that is take couple lose of just you're you of that second half the that change. which reduction to $X to apply and hundred

invoicing customers, that, now such duration so basis, invoiced of invoicing the invoicing for effectively changing that's ratable annually. upfront are or we Second, TCV percentage on we're a

typically, So, are our deals three years.

months. XX.X Our now about average is duration

building we're a-third; a-third, year one upfront, and a-third year after So, after a-third two. a-third, a-third

combined half had a year, about XX%. in And collection previously -- the higher -- this was on first of we closer we basis it so

combined a second to or we The on basis on think combined, half, project a be to XX%. going is we closer

roughly second $XXX reduction of half if you the That's paid of on a add the kind up, all it's year. million So, of that about roughly in XX% in cash TCV $X reduction. upfront billion

And again, it's all timing.

We will an upfront. annual cash of an less really now of on that or instead be invoicing basis upfront,

be of year. back for get So But next balance year. that the cash headwinds we there will will this

Brad Zelnick

so from SignalFx. I Thanks. you by just versus you if with SignalFx? that have know. really explored? ask on much a Doug, what the what company you Congrats partnership had And Thank It's And do other we But What just why for now? could the that. follow-up. the to into alternatives bringing high-quality company full can you might already

Doug Merritt

in question. are that number you're I of can't Thanks have, since debt We the segment can't of joint and/or spend different producing -- we've Brad. time of founding I we with really met APM and company customers There -- Good all And next-gen haven't the investigated overall yes, deeply. customers. in a IT business. a of you lot been We of are the segment this in think right. segment. we as they in -- personally an the of this alternatives And expect, the

as we leaning asset As which as ephemeral architecture around observability is try our next-gen you everybody get application to velocity just high suggested, high, into and GCP, is metrics and view across as the that top-tier matter to cloud Azure this accuracy customers, OpenShift. very well scale, things the SignalFx AWS, in that incredible to

out SignalFx that instrument best-in-class, big see has best in world-class plane, you're the that two flight is capability metrics this deck proven super a more use between extraction and with to, not understand as root SignalFx you metrics or you're log it whether number to SignalFx with that aggregation, is is, position you're in, very signals trying high-speed The these we of complemented direction, it streaming combined companies be the to have scale, accurately. which make to and in real-time deck the that remediate quickly our the is what When able right capability. and attention investigative sure going management paying the dive a should actually high then world-class able cause something, to a

the systems, really And enterprise the it metrics this critical which with to done high, that three highly incredible features companies are so whole great helps as at if about portfolio. that this need and elements having backbone IT and to suite, core of the across the accuracy, think addition all be feel is logs, you tracing us generating that's so and a high we generation strategic to scale data important

Brad Zelnick

Very exciting the on Thanks. all success. and congrats

Doug Merritt

Thank you.

Jason Child

Thanks Brad.

Operator

you. Thank

from Lenschow Our Barclays. with Raimo next comes question

You question. may proceed with your

Raimo Lenschow

stay Hi, Doug, think SignalFx. -- well sorry. think integration? are perfect, stoned you products having work you. Congrats like together? else on thank you product bring side-by-side? from how I me about as it, to do on together? do you And if a how come then Thanks. Like does the I can How And the you this? they about Like, have to Or follow-up, do how this

Doug Merritt

Hey Raimo, the thanks for question.

we that these again, spend of time handful customers So with.

very over we customer As centric. say success over, and first and we're customer

listening I'll consumer are doing you investigations great the all give a helps retailer doing, and and they're that to they a to example a when backbone we for effectively working side-by-side lot. now. expensive we've customers uses Fortune there's And world-class are addition their you're in online everything as doing our right So, an as been XX And having, Splunk well. across portfolio SignalFx uses very

and dive both of get they're with right the reality bot customer then is of can think being make side to human keep they job SignalFx that greater there to you Splunk instrumentation, of direction. these they what right situation and about when pay and a an you activity. one anything in really does nice the any to know activity attention need and understand, online, them revenue trying with And want by introduction if the when revenue in to its sure to is big should drive that what so unquenched is help they go experience consumer anything signaled optimize that as reductions. do they SignalFx, and the providing anything

is The between we integration that goes pillars guys tighter framework, and been data the believe and traces that there landscape. far and there's metrics some logs, you that benefits two. -- the this do we've to happens those as be to learning back significant obviously I as of about next on between going transposition constant talking believe with to generation acquisition --

have a have got those action an -- that sensory approach. and analytics working capabilities their We've ability pillar, respond and in the effective concert to to investigative organizations monitoring, set of four provide real-time

get detailed full like and Development see some very the Tully, to, anticipates between for CTO and Tim we'll rapid products. Head interesting and acquisition being actually market the I start and at we the So integrations I'd our that two the together as fully to working team level developed delivered approval and of anticipate can

Raimo Lenschow

that a the Jason, extra so before. And just is current definition want you for all clarification, from in right one XX so had wanted to Perfect. The just I disclosure. to which step direction. the XX thanks good then make because you app on, very sure to I thing different months, -- you said a of current the kind so the months, that's moved that XX double-click

Jason Child

That's right.

Raimo Lenschow

Well done.

helpful. you. Thank Well That’s really you. Okay. Thank done.

Doug Merritt

Raimo. Thanks,

Jason Child

Raimo. Thanks,

Doug Merritt

key are guidance. you on Raimo, Hey, that

So well. the year thank early us as feedback you giving that in for

Raimo Lenschow

you. Thank Perfect.

Jason Child

Thanks.

Operator

our Jefferies. you. John comes And from DiFucci next Thank question with

may with You proceed your question.

John DiFucci

you. Thank

the going a for important. a But, for So, expand that's Doug new data. remarks, Doug, expense you the Splunk Can pricing details there, opening because -- your in said and that made cash little bit? you through comment is thanks, Jason, flow really you on

community, probably expand the the more little on this talked that, that's new community. in But Is with that so just as is even would great? than there we and a in customer you could Splunk, know that bit, because if always new, about I be investment out you don't things some of know, one recently pricing the there see as

Doug Merritt

Yes. Absolutely, John.

broadcasting So we the teams over of release of this we're internally much our more pricing course that to be loudly did to going quarter.

So There we've are everybody dimensions understands what shifted. to how -- two pricing.

dollar or One my and And multi-billion We've they're understand volume they with piece. have like they got I it whether was contracts is was there, data the one comfortable it company the the other. and ABB people went large when through examples software that it. for not, digested

much and We've much that to there unlimited quickly. to their bands. very looks clearly them like crafted what the core any them unlimited we to illustrates to for more framework And a pricing we're value that organization terminal coarse-grained footprint of get people box. What terabyte predictive moves size sized is show more is enterprise a Splunk trying

that in know And being so I we offerings of and that them. a and with mean, there's value, by many years, they and we business budget we after X-percent know understand only data business functions, them terminal a that software for not mitigated logical want and what for know we're is today's that features that, to

stop they worrying filtering about data. So can

they want they as been we they They no separately data. core therefore, to. just thing want, metric, Alternatively, allows also compute unlimited type as that's Splunk of, infrastructure-based infrastructure can storage customer a amounts pay use has of to and it rolling that data the virtual can virtual add process And all. at for then or delete much kind and out to a CPU,

The only response. the speed difference is of

with So system. the people overall that the interface have

response. infrastructure add you get faster You more

need be loud to But less, less thoughtful a response. clear that pricing, little more we you pricing. and we've on bit add the through You heard years get

-- iterations, what will no We've work and of perfect. what been And customers, those piece I've of really learning pricing for that, seat. years the in iterating iterating customers a is the three-and-a-half through we're been

continue to The the is, other expand of beyond portfolio that the index. piece

portfolio, our past and at meetings I of and look quarters. lot the that with the in a during really you your couple of we've said peers had this you If

price product, only priced of in And metrics Enterprise, metrics. the products the and infrastructure-based alternative now with any a index out The priced Enterprise to else is the we on on the ITSI three Security, everything volume as only corner or data different stack metric for the well. with that are came just version portfolio index-based, Splunk

customers. our customers. responsible So very see saw important very we it rolled some I'm internally out QX, the in I And move as think for from predicting we response positive we'll it becomes and it little QX in even more positive the and more external same, probably well-known with it as reps bit conversant with as more are we well. a response go

the same in their leaning them are time that. with are customers that reps helping So

John DiFucci

follow-up. you question. interesting. and follow-up -- The that great. the of And SignalFx That's too. really Thank look had to product a right? I'd that's another like mentioned That couple is I'm you just listen thank detail, And for Phantom those. a guess, as quick you And going really But I Doug. you. good, numbers a

are needed and the have think to enterprise orchestration, everything products to And Check you Palo in you know like just, and use customers trying that Phantom put world all overwhelmed companies the Point as and security of I to Alto roof. that protect they the by are security one under

best-of-breed towards -- go like Phantom the in broadly together some that like, say, roof. used within entire have best-of-breed, I across this working like of But neutral companies of should how still guess kind own nirvana in that enterprise being an most to brings close portfolio? thing of -- product be a the and always nirvana? it they your of you ones Like to that that are your those use is guess, everything how I is, their And choose is Phantom security question I've as that my you thought sort that that even is would a and

Doug Merritt

Great. John. question, Great

department, as matter to what the platform, of cases the manufacturing Phantom elegance no is marketing. an automation important what So be architecture entering approach one, part overall That more about whether sales org critical the to the as is from SNUR department, maybe part the – are. security able org orchestration department, the or of the of SOAR an IT which is whether Tim part into which loved than is automation you’re you’re orchestration to use you're of the leaning part we right Phantom, and are important to extend the

we makes see really security that that completely And it an the product orchestration security and love that agree I about in you also, is in other I the landscape security content think much automation go response use a really all come will framework. you're with The we changing quickly are security going to volatility. so the old lot a in, on but There that to out a not continuous products products IT basis. of have where so case new can't

it's now Splunk the and index next Phantom, whether generation are tracing And or exclude stores. Splunk Phantom metrics or increasingly

layer job critical be the Our that abstraction elements to detecting is try transactional and the manage to security and and trying across at framework be that of to that those that allows all preventing both the landscape control customer. are

They to is stuff the brain and in sure an existing correlation work continue what and new and they is there routine there automation to framework and ties can and do. will nerve we out decision that in those orchestration effective to that tell whenever stuff to system swap that want make that swap of

of And a the which is core cetera Phantom the the is all actually center. portfolio landscape And is virus still acceleration to the products they're them. control in et firewall like that of those muscles it the ton feel entire a really the from that and need brain. leader Splunk landscape and to part endpoint protection, need helps of security nerve of the -- view isn't in are you products control think But security of do the work. different I

John DiFucci

lot, the it Thanks Jason. in and sounds really Doug process is that like here. Okay. journey Well, a

Doug Merritt

John. Thanks

Ken Tinsley

It's good been great your working with gig. and John next on you. luck Thanks

John DiFucci

Same here Ken.

Ken Tinsley

Thanks John.

Operator

Thank you.

Keith Weiss question with next Morgan Our from Stanley. comes

You your proceed may with question.

Keith Weiss

to of to that's is environment? is you other place on view makes consolidating case, that get going whether monitoring sort that platform seems in of on to consolidating monitoring Excellent with the SignalFx. guys. of this you, Thank acquisition infrastructure puzzle APM, a in Excellent. and in one the really there into be guys to nice of me acquisition, needed lot acquisition. portfolio. complete you monitoring sense quarter debate this put It are log that pieces It weighing the any with into monitoring, the If

Doug Merritt

monitor, very of Yeah, Good Keith. about, four fed -- data. them of question, the the data-centric talked one Investigate, three pillars are is the on and act. them and by we analyze,

think index the is covers investigative purpose-built. the an need one platform an in that is as way because think I the built, interesting, the that I Splunk framework if example, it's don't

high-speed, flow. need that's where so a is effective category architecture truly that list, flattened you that you've many got many, that high different need cardinality in again data to set the multidimensional of defined, but investigative you to instead purpose-built is very you suite of same monitoring, of random a out rich we're Why what points a drive. that That framework. one, got a be scale in of kind logs, of for schema world-class many, well of all metric And different then more for

and real guys excitement been be was So, Facebook's that of best-in-class. highest common part monitor the one in back organization before you it scaled the hard has to And these the buzzword, of learned of what world, these a Twitter's. inside wind walls Google's up to of and ephemeral And want Facebook SignalFx. that was talked with takes outside different technologies environments the of across pillars, that the about in if the observability way really the you

a have They've of they've So, framework. world-class lot a experience. built truly

make I The Data Tracing Data think that app And like little Fabric that Search. it of skills. I is the -- data of interface point a that the I you tough, data to core advantage that next-generation whole third-party, a mean, still technologies specialty of choose whether Because that metrics. can different is journey. for wherever really for bit in at end happier sure and are still user warehousing That's area our a still compete those things expansion to important much we're Search be look area excited about architecture, to us Fabric all set pillars really then we data that's or a the really as -- well. good take lives. with there

some other help make and let's solution best-in-class or platforms company, think got still whether best-in-class in some we've Splunk, like SignalFx value. we sure that we customers extract can other that So, our is whether now the solution

Keith Weiss

That sense. to been ton laid adds. that new KPI you it. customer one the of coming follow-up to makes customers then us on hasn't talk Can you the about of you Got in targets ramp-up kind one if out had of And will? that door hitting efforts sort new into a place That's previously.

Doug Merritt

quarter. the absolutely. guys this us We year We had you this X,XXX XX,XXX to Analyst mark track at year we had Day. exceed on which we're XXX forecasted at and that Yes, that new for customers ago gets half think

to lean a activities can get at low make that end, their the in is usually that and But point infrastructure of products a We Splunk critical footprint. but critical tag. the immediate virality we make usually some if a different have strength the done it are so properly, infrastructure. ASM, set that set decision journey carries you've of time, now rapid at in bunch to the it spends it on sure entire companies most price to at the continue of becomes organization, of viral of That our higher

accounts convert plus Splunk there and with effective important touches cloud touch across our probably why perspective. to to within going X,XXX so is those pervasive the to ideals, we year is portfolio which more list, be those the is and always The downloads and constant important And X,XXX of the and still share motion continue revenue trials overall important entire going be per enterprise-wide making sure yang conversion yen element and is wallet of existing that to the growth go and from we which happening for that up is lightweight ASPs overall get mark have us.

Keith Weiss

on Excellent. guys. quarter Nice the job

Doug Merritt

Keith. Thanks

Jason Child

Thanks Keith.

Operator

you. Thank

UBS. Fatima Boolani comes Our next with from question

with proceed may your You question.

Fatima Boolani

Good you. question. to maybe Thank taking the for start Doug, afternoon. you with

to IT of bigger of developers. enterprise procurement you As trends of procurement, gravity to about around a the picture think lot kind we started shift center see on

weren't So, as optimally? the feel that well. have up do you could I acquisition, you buying as it follow-up then And relates necessarily open to how SignalFx maybe this into it tapping a audience a

Doug Merritt

Yeah.

And going back around Keith's has to net And footprint. certainly the that think We maintaining to question, are news addition developer many That's parts consistency year still attraction touch and the did we much viral, that for I on more true core that SignalFx buy an one low the products. that's estimate about is net VictorOps news a centric to trying VictorOps us. and Splunk exciting the fold. be ago. roughly of helped

footprint But the SignalFx, developer ops with gives a more IT much tied But think that has now interesting back approach. I us combined then ultimately, team for development team. direct

to work Someone divide or next there's -- DevOps CICD got true the and a two classic and it's activities a generation, ops together. has IT Those world. whether opt in SRE a

IT core the to end-to-end with of Head development and Splunk team, Head with ITSI or a Engineering all give up or coverage, really manager way developer us combined VictorOps, interesting SignalFx the back think whether infrastructure complex and ops I So of across of leading we're individual the landscape.

Fatima Boolani

points that helpful? power and super with newer sense. gesturing XQ the maybe pricing we some the makes compares specific out the and versus that flexible capacity-based perspective that model? infrastructure and investors the change maybe into Because the underlying the pricing that the of the just based I so data have, word maybe things in of more delta an of anchored maybe on the infrastructure Thank think indexing some some front, would and think dovetailing you to of pricing to, you around metrics if That you’re should And comment can data base you. from you on things and pricing trying data coming comment traditional how about as that, very that you just that being some be down how your is a perception your with customer pricing

Doug Merritt

attention in We've I'm that because its volume ops trying into Splunk, because almost X,XXX more exist what the When to advantage customer since -- here. got know say, metric. me years, five good and actions super now past have years any pay data have that even I judicious to could heard most I I the Sure. put of been Fatima. customer metric, should to told X,XXX I only thoughtful data over That's -- that take one of. question, which you've six once that account that And never I a problem, based be at no I've pricing data is

that with number going people to that being guidelines we to data the around seen what then as that we've really serve data clear for X% their to do, think XX% data this we pricing volume are with penetrated So one trying -- heads put we Splunk within so peace can a people focus to success what customer volume organizations. the customers that we predictive why wrap areas believe our would like back we're important, and still company. are through is to unlimited is that we and And relax piece, if

what amount element. is dramatically I think and backbone. because we pieces that on see what go the see of So this the we see -- through internally, up appropriate the volumes one is will And we out people data, volume Splunk scary in saw data that really we roll take the we'll QX,

Just update. as quick a

data largest petabytes less real petabytes XX day, is time day, data Our year. the ingesting the per than streaming of from beginning over customer of X at per up

So almost we view possibility an data. infinite of

flowing Now based, non-data only SignalFx, their our advantage amount or from that from those from Phantom, with of with The Stream or data from goes from with storage those either Data data all take Data you in pipes through VictorOps, up Processor, non-data Search, DSP, landing value from pricing elements. Fabric different deal combine products.

of Splunk. want as just we everybody. you you a can so where right it, manage that worrying about the you finally through the amount just framework put you either yourself, you but in clean cost govern infrastructure stop data. with data applying to for get with infrastructure, So as was move charging that the we'll whole -- of an give to or much data, and data come the again, infrastructure Hey, cost, not And

Fatima Boolani

Doug. you, Thank helpful. Super

Doug Merritt

Fatima. Thanks,

Operator

Thank And Lynch. from you. our Merrill next question Rangan comes with Kash

may Your question. proceed your with

Kash Rangan

very guidance on year? the of also the I'm second And half impact acquisition. for here -- of curious, if is just congrats your in going the how SignalFx on revenue Hi. the have Thank included be much the to the based call much. you you to Karthik

we've from we've a kind cash mid-XXs mid and timeframe about XXXX shift financial talked respect What you of And yield. Jason, flow cash like there with looks mostly talking done, are we is secondly, it perspective, about a to XXs somewhere gone flow be it drop. between yield? Could worse calendar calendar endured through of the or flow that shift cash kind the XXXX, because case so

the on I as positive revision side, would So sharp the downside, equally sharp as on been it cash be up swing right? expect it's the should also flow has

Doug Merritt

Yes.

the it's off you cash. rush if lead saying, still by to quote, okay start me want with Let

Kash Rangan

I'm on rush. a not

Doug Merritt

as We're not hard-core like Karthik we rushing. still

Jason Child

state, in did I got the I rush adrenaline job so.

Doug Merritt

part, That's We right. got the rush signal.

Jason Child

Okay.

didn't we in the first, So revenue question include guidance. on about in effectively their embedded SignalFx revenue guidance,

what And be just did because to so, cost -- we cost know it we incurring. going include we're

we'll In complete acquisition. update of the when revenue, or the terms we completion when that

the of cash In cash. kind terms the the snapback of question second one on tougher on on --

billing kind The issue the every on of you -- So business. annually, is so recognize $X here's take do cash, which gone, in the receiving but deal you I issue. durability if term, perpetual since on three better for much is it long-term downside the think the most on revenue, now in -- The we're of revenue cash, -- the term $X term the we upfront. your years get hard recognized of but average in revenue for

a booking low as has it. yield it relatively So you're cash

that get the course you benefit Of the in later as comes. years

percentage upfront have problem headwind of the the deals you're were to cash almost booking receiving cash higher – year as well. so a higher the the through now up Now is through year this we the of recently, really next or effect the balance until that of and feel three-year two-thirds -- percentage term because the that a definitely will going of very

will dollar have to business you have as $X you revenue, is, move a aspect The for every where you'll cash. ratable cloud there of -- second you

that's cash yield high So a business.

So quicker to and expected. been moving project we mix have the is, that -- had that we mix it's reality than

to And committing so timeframe that is hard.

mid-XXs those point, see monitor But your businesses that's see as next you question? it's the we Does at this until between something obviously will that over coming two of I XXXX. likely we'll answer not mix quarters. the that that impact So after think the

Kash Rangan

part. cash flow the mean, to perpetual that mean, I I the and that's does. is worst I down the It detractor mean, to is Yeah. your one. biggest

today would that So manageable mid-XXs. talk it back. be cloud, some little as months kind having as have year, you that range to say it is should broad granted implore you albeit a had not great for going cash going don't definitive I'm a That's… you surprised have than can I imagine, you're because term of and would that I be, between give three But we XXXX. after news right, which be next to more be flow more more That's to some

Jason Child

full say guidance, would I year happen Yeah. we which QX… as give will in

Kash Rangan

Yeah.

Jason Child

ready be -- about Then we'll it probably then. talk to

Kash Rangan

All it. Thanks Got right. Cool. guys.

Doug Merritt

so everyone the we're more with trying what be and And to and much Kash aggressive as needs saw at you -- Ken visibility visuals, included Jason get dial. that transparency with to

everything we you answer as no year what effects the with really that why pretty feel on is is, understand that confident closer bit have we matter little to so less answer the to answer clarity will now, get of And a next I motion the opaqueness. we're and putting right in the

Kash Rangan

.conf. you Wonderful. guys We'll at see

Doug Merritt

you. good. Sounds Thank

Jason Child

Kash. Thanks

Operator

you. Thank

comes question with Our Citi. from next Walter Pritchard

question. your with proceed may Your

Walter Pritchard

information Question us for calculate you’d I of I you. number could CRPO, an measure gave bit RPO CRPO of Thank that's to a constant bookings you be Hi. that bookings think growth? that and Jason XX%. all the give Is able don't number. you we to the a like something standard of on little more think duration, if have

Jason Child

sorry, for RPO, current I'm -- metrics? historical you're So asking

Walter Pritchard

bookings, Yeah. The Yeah. CRPO

Jason Child

no. No,

Walter Pritchard

given can calculate don’t this we QX to that we a calculate or QX. something don't the bookings have because quarter have You I think

Jason Child

slides RPO website shows back five actually slides we links provided, on quarters. current The the the going

Walter Pritchard

Okay. Got it.

was quickly unofficially something rolled Perfect. know pretty of there it transition, And Okay. the it seems quarter wondering like in happened pricing sort out. been Perfect. then it's I'm seems renewable, on Doug, I the to like the

it. shift that probably of there a time with driving such in Is with that -- in the significant drive you terms didn't renewable? -- attribute short something amount of So,

Doug Merritt

with had Yes, I do don't price anything think to the it.

incentives put cloud. we've We half half -- in starting leaning make we year more ago now, on both year place been attractive think and for perpetual. to and term and I and

to and half or focus on I cloud. determinate not, with were time leading the first like the tends ago it think we So, commission our And team year for sales plan. a reps whether,

paid when per leading So, with more perp. they were

And as one companies going cloud and there no be stuff, category, cloud. help. you shifted simple And with that million bigger are which and their spend you so their budgeting trend OpEx that for on times how secular a guys head a heck the can and me both with to infrastructure are our that SaaS shift think SaaS handful now some and how need is IT actually I my There of now the into the to has more people anyway except giving OpEx leading please entire less the rate continued day -- limited and matter they that is heads way. are we is report applications for you that a can industries is opposite, made I asking a is for because capability, I around just wrapping spend my platform-as-a-service doing term much attractive a all it today we're

now to there with a these and I'm the make just is it a lot more really can other, us. that trend just and bigger other was business because debating offer one and customers it pricing because to of versus it And course, CFO the do you easier. term make of and think away it harder, took he we now is you just different bit So, constructs friendly and caring little piece primarily if just back cloud as with know, even my try guys I going having making that long, saying, that again perpetuals job a

Walter Pritchard

XQ RPO, issue. the the of Great. on last have the is Jason don't just then think I just year And we

know that's don't would something can but if provide, I that be So, you great.

QX stopped last quarters year. at of think the I five

Doug Merritt

the then it. year infer this can growth you XX% you’ve There's And Yes. got QX.

Jason Child

with XXXX Yes, from that growth of get can you to rate the RPO. QX each element

Walter Pritchard

Got back cable it. it. I’ll into

Okay. you. Thank

Doug Merritt

Walter. Got you, it. Thank

Operator

Thank you.

Bachman question BMO. with comes Keith from next Our

your question. You may proceed with

Keith Bachman

much. I questions. ask very two you Thank to Hi. wanted

as if year? million perpetual one to make a year headwind a cash it first to At back to that is a for zero, just flow benefit it starting minimum, versus flow year. the facing this cash for a X, is your second on your The point, next next $XXX XX from is that you're gone

Doug Merritt

it's is it -- is it's box doing a the collected you're perpetual. is upfront. occurrence you booking you're assume repeat No, And so because all determine going to one-time cash of that you when that it, perpetual cloud -- yes, if -- much booked -- to that be one-third perpetual for flip XXX% perpetual yeah, -- not have a

Keith Bachman

this $XXX if Yes, move comment. previous year I you Anyway, headwind a it's in million. Kash's philosophically have and right? I mean, agree it you I mean, next with year,

get the be I think to guidance it of and beneficial. perpetual it just again some would be around elimination should headwind for helpful on year, comments more cash flow next

the to RPO transition I'll bookings.

a to going So, speak bit to the the from on get just wanted is. I slide. what narrative am of little help I

look metrics all So, good. the

little going RPO your of from XX% QX, growth were a Your in in XXXX, XXXX down QX, terms bit to growth. was XX% bookings

why anything might you bit. just to the is it slowing -- and there So a is it has that that relates RPO comment particular want in bookings or lumpy? slowed to it be as Is

Jason Child

related an certainly it. we adjustment XXX, the I'd you implemented some was is to But say thing there year. really So if prior when lumpiness so be take is, to out -- XX% the should first there the -- that

If adjustment growth you The XXX absent normalize XX%. year-on-year it's is that points. basis that,

it is So, being XX% of really on a you a comparable on think basis. should

say… would I Now

Doug Merritt

Which not number. a is still sterling

Jason Child

number. sterling still not …which a is

So you bookings cloud, this XX%, software revenue is revenue, metrics, you so XX%, other growth see look billings so potpourri you growth at probably is then adjusted RPO was our XX%, have XX%, XX% of metrics. and if

I like it, So to what than other it's I And XX we've trying in to those roughly looking I’ve been about said of high know focus as days. is that well number? metric talked software looked Why I've number And at been growth past, right and XX%. the revenue out the here I a at figure is really on. the right

it's maintenance are and move it, look it and is kind two Well, to the see because services of are slowing cloud. limited reasons. at that the reason we as One, and is maintenance I unpack the one, growth into slowing cloud, for services when embedded I those

So as revenue. it's recorded cloud all

those more partners relying high and It's It's for we're us. professional business. Second, to them services on to margin for a not provide better more do.

is think the underlying is So software if you core on revenue. want to focus about really It to the growth to what's say right really what rate growth?

Keith Bachman

Okay.

Jason Child

think see the are There's So, I will there bookings. lumpiness -- RPO impacts. you in

when this at key Again bookings. was revenue will and adjustment it the look little think bit bit because will and fact you I probably deal I But But should RPO a probably see move that that move around we the can lumpy numbers stuff the make hits TCV all you large of little think and a that in a it lower is be timing quarter. bit. driver. software of a have

Keith Bachman

great. Okay,

slide I think the on deal makes perfect Much appreciated. sense. Congratulations on that. deck. thanks much And very the

Jason Child

You bet. Thanks.

Operator

you. Thank

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

with proceed may You your question.

Matt Swanson

for Swanson actually Matt. This Matt Thanks. is on

you comments how implementation those talking from kind of gone? teams. an have just update know it's last the of quarter, I pretty probably did some Following-up still. Could about early solution we on the field give vertical us

Doug Merritt

Matt. question, Great Yes.

President vertical that verticals people flushing vertical so handful people to services, hired retail, now for and in the healthcare, Ledger, who St. verticals cases the remember, just about are as financial -- -- manufacturing, what out that specific team last on seven telecommunications, public focused the talked our ahead I sector, So verticals. we XX to quarter has Susan use of

mostly financial published more based. sure are use on technical setters, that But sales think vertical on and found the non-security are told quarter, of that sales by actually working sales XX I more good side. specialist we've beyond those highlights account guys the Dev who we that that everybody They an the sales non-security teams They different last journalists, making not or independent RSM. doing security different is got it's an services evangelist those security the e-book have guide IT that I with -- really you the team. they're when you'll some based, being direction accounts, published IT as books have IT deal see can focused really recipes help IT. XX% move been are work. specialist the and probably those within and secure They certainly than and And an and cases

somebody, potential Ultimately, and what or understanding an we're it. they the a enough that for sees of hoping cases that actually gets us around use craft those application is market partner,

to for way the market a seed the trying eventually based non-security, turn we're use it's So applications. that non-IT, non-dev into cases

us And it's continue earnings we to multitude Splunk verticals different tell customers that them every cases people kind And make think, been make is and talk the and a really use our and in helpful, sure to of I with for visualize call anecdotal. recipe not this whole those is attempt down. that there cookbook about SplunkLive! an to written guidebook they're anecdotal for in less to

Matt Swanson

talk environment. containerized you just Could then, technology for That's if one through get I SignalFx. it really how more pervasive helpful. It's like, And well-suited your really seems install about on base? is that

Doug Merritt

they're with, Kubernetes, containers, very in native I think And cloud, it not obviously as there services met development the cetera. do few have through activities was I that cloud. customers are that in active the micro-services using et up the

it -- that's it So I think is incredibly undeniable is wave happening.

total boxes servers. or Linux back or on workload. When it's integrating that data still the wind are with center. of lot applications A back being signaling a mainframe at you of Windows and the applications workloads up small in They're driven, percentage the back still core go look the

Microsoft But Google -- the landscape been around our our on that's think to and of everybody continue, and to that the I with very participating. been environments, clear coupled providing we has that team visibility wave rest its very been team else that expect is customer has important as those the clear something Amazon And them. on, and

Matt Swanson

All right. Thanks.

Ken Tinsley

Matt. Thanks,

Operator

you. Thank

Raymond Turits with question James. next Michael Our comes from

with question. proceed may You your

Michael Turits

evening great Hey, wonderful this deal, really broadening way. branching guys. and and to really out see Good

questions. So financial a of couple

a and just First clarification. also

all Is billings? we Just -- rule annual Jason, that now are you are the annual XXX% invoiced? or annual are at deals to invoicing confirm

Jason Child

average very -- I very, mean, we have XXX%, to We're close XX.X-month is a which Yes. duration.

call slides. understand look is annual think, three-year if So works. website tried at, basically, saying, I basically And I annual are we to basically And term. folks which that how XX help a you billings. slide it a XX% it at this of basically shows the invoicing,

but few correct. average on billing exceptions, annual very So is

Doug Merritt

to will to And give pay them not we if wants don't We the money. to ship us that it someone money, back. give want

Jason Child

is every I'm all one look, used from mean, services to them. write I a SaaS And, a from buy all one I've big going and yes, upfront Splunk to providers unless they who of bought check of the CFO got a the massive no discount.

And why slows negotiation and it so, down -- that's much or takes just longer.

what makes this that's doing So and it the is been sense. market has why

Michael Turits

Okay.

was are was the think and one, able Walter into through bookings adjustment on And for tell the Another this. what you regarding the just to RPO backing noise a year-over-year for RPO on year basis? XXX. ago asking current cut I us

Ken Tinsley

Yeah. This is Ken.

Let that. me clarify

down. rate So is deck. slide the broken growth -- he's right. from you get But The the total the on current in RPO can not X

is. it So here

-- million So $XXX $XXX total million long-term, million current. was we've of XXXX of million $XXX already $XXX disclosed short-term. million QX sorry, -- our million was total, long-term, that $XXX million was in $XXX as XXX current RPO $XXX

Doug Merritt

then for Jason And answer that. the Okay. can RPO adjustment,

Michael Turits

Right.

not I have too don’t times. you back know mean, can… forth I many it, if you and Okay. going

Jason Child

Yeah.

So.

Michael Turits

get RPO, actually for but to numbers, bookings going we’re lot adjusted A so. of current

Jason Child

Right.

Michael Turits

you've can got So we be that maybe it offline? if otherwise do would illustrated great,

Jason Child

Yeah.

were were you same you XXX XXXX would X, by if would down RPO bookings, points. see basis adjust to QX, you go to if go slide So basically

into XX from XX it, up And to of call go So instead XX. XX. QX would

Michael Turits

cash do to outlook. can at know sneak if for We’ll to flow another I a right. just I I'm in. just more year. one next going get could offline. the All And And Okay. I’m range try take shot to going we more

are after calendar flow XXXX target. positive? you at get I from cash to we, you for fiscal when is think XXXX, But ops back said least

Jason Child

fiscal say, I'd fiscal XXXX. right, yeah, sorry, after I'm XXXX, you're

shift. again, depends -- on the mix it's Now it

to want very it's And tricky. so I sure is just this make clear, because

and before, was a someone to Again, want headwind on very So be I I it's or Keith it make I sure Perpetual. clear. headwind how there about think wouldn't think asked

you're basically the upfront. On three collecting of years perpetual, cash

one-third to of So I'm when switch cash term collecting I upfronts. that following year, the

when is it headwind of a So that two-thirds happens.

on the XX% for year. perpetual. headwind So collecting on about on roughly go average that for That's XX% of then just were And that's term, going you this to see first we lapping next the half year.

going have confusing $X recognizing meantime, more the look term gets least if then at in When one, license of yield, those one-for-one it you’re it's -- then get are portion. three to the of And years to you both because $X for effectively cash. and at upfront, on of perpetual you cloud, revenue revenue, are

have you one. just dependent look variables all not three to or So three dimensions to all -- at

Michael Turits

that question My fiscal just looking in you guys terms of ops forward, positive? can XXXX, from Understood. will was at be say cash we least flow

Jason Child

XXXX, will I'm just full cash year to what -- there's this I'm ready -- that because, going not forecast of flow two -- be we be ready some end year, not but quarters. the say to to say now ready it that variables. -- again, after positive But I'm it it's depends is mean, in not to it I'll yet. yet. to I both do do do by have to just the I

Michael Turits

All the right. very acquisition. and much on Thanks congrats

Doug Merritt

Thank you, Michael

Jason Child

Thank you.

Operator

you. Thank

Our Stifel. next with question comes Reback from Brad

with may proceed question. your You

Brad Reback

Great. Thanks on a paying be very much. that you upon on will certainly more renewal you change, basis? confident Doug people back are like-for-like the pricing

Doug Merritt

mean do What like-for-like basis? on you

Brad Reback

customer have that So, bigger? -- model? unlimited this of to can pricing is renew so sort an Or this of get idea to existing only they

Doug Merritt

we now, only a have very contracts. right few unlimited So,

and even say, we've roll be back and an because type CPI unlimited increase customers. that from that and but for adding awesome payment DSP unlimited SignalFx has some there Enterprise those limited expansion there expansion. be all will and current big Enterprise, of unlimited, of we'll with So, is And Phantom, usually is DFS and their are and existing read a modern move got uplift other let's is framework add Splunk that to hopefully, portfolio. it more adjustments to of and those time unlimited this current and to forward We've for for over new in got unlimited to their for come Splunk But stream people those a the you’ve got products.

much I've in with in years buy. hold When you I more I career met buy look and -- from part model that at upward why the our frustrated think Splunk. are installed there my exploding account more saying ever data our with you knows you're people And I this everyone so just want I'm to pricing is is entire the more -- to me not pressure going ransom. of base, at two is single is every like which the

will working And a really, That's much on this structure with that more ransom. to really, not got including we I aggressive you been hold we've who we we Oracle. really not not formats multitude just think EAA are. say We're different

a a company And are what know making to focusing and value that on exchange productive want we happy. we guys providing are you give fair us. that is between We what sure we and here make there's you

what of to make like I'd we've portfolio So, index. they irrespective the our accounts to attractive within well, that expansion as our upward pressure continues and expansion Enterprise the Splunk got to looks within sure as be expand them expect

Brad Reback

last the Can then And unbilled million? us I give about but or was was $XX what impact Great. follow-up. contracted you one quick quarter know the Jason,

Jason Child

unbilled. but Contract

Doug Merritt

XXX?

Jason Child

XXX.

Brad Reback

very Thanks Great. much.

Operator

Thank you.

comes Mizuho. Moskowitz from Our next question Gregg with

your with question. proceed may You

Doug Merritt

Okay. please. let's going keep Josh,

Gregg Moskowitz

on was I sorry, mute. Hey,

So, good afternoon guys.

along couple with of commend a Just disclosures. want others Jason any of additional to

a first I So, if clarification may.

this represent So, million about previously $XXX you in $XXX had talked you a and appear two dynamics that million, now so million year ops guided $XXX cash And in to minus swing. delta. $XXX total it's million flow the

prior XX from been mix constant that, not mean days you so case? or ops expected your ago invoicing had what and we were does about fiscal or that that would with the higher your that than So, hold the XXXX flow renewables if duration million guidance have cash $XXX is

Jason Child

Okay.

let the statements. of clean up First, some me

million $XXX minus not to $XXX guided we So million.

now the XX% second and times, reduction. to because at collecting that's $XXX website reduction upfront from headwind. $XXX million-ish billion a previously. from it’s more the XX% SignalFx attached is we you a adjust said that's couple So a look shows the of million XX acquisition, went -- slide $XXX adjusted which the so guidance the million we that $X little TCV, XX% -- half slide also that little mix that the things. XX%, I'd if roughly the collecting There's that had about of

the So get million. how that's to you $XXX

again you I'm of sorry. Now question second was? your me what the Can ask part

Gregg Moskowitz

been move with… seen Would and higher shorten we've perpetual if we duration hadn't the we if hadn't

Jason Child

Yeah.

So It shows from went from to is. impact adjustment mix perpetual slide X%. a XX XX% what the

see could of thing then cloud. the and the X% for two that could other you do XXX. And times same So you buckets term

Gregg Moskowitz

And on mix. invoicing renewables it appear based for would Correct. at gone and have a that Okay. apples-to-apples up least duration math, does higher if not again my again

Jason Child

Absolutely. Yes Yes. definitely.

Doug Merritt

for Yeah sure.

Gregg Moskowitz

Okay.

wanted Just wanted follow-up on also in so and data revenue if pricing, each volumes hold about secondly, increases well. the clear to guys, But under ask not a that. drive you've And And increases so the still true to confirm I every then obviously, that is will historically plus as one. spoken pricing how correlation in year. predictive

Doug Merritt

can every get Yeah. where pricing It there's I path band and are they sitting predictive unlimited license. X at It before that those should and unlimited. much grant been more provides see N have -- a coarse-grained I'm now customers bands -- existing doesn't to the

data price if control So high point have visibility and what we're for data currently much at the potentially and the will future. we the least that of in more have be they'll

I their as terabytes in platform as expect realize, that still going consume five or and past jump or holy unlimited. we’d few much band. start when going get cohort They're the much out terabyte a can to to eventually So I value with that cow, gigs and prove people then one the like upper in want of we right come, very XXX showed to in our are

including half that on couple organically And with year and piece. Phantom and products out many we've then cohort Enterprise the past the that core have Splunk over that discussion in whole the VictorOps complement come that added that like you products

sure complement make on that it Splunk So Enterprise people on to that bring what technologies even craft we've to side consume there more and Enterprise top of new life well Make or clear has pushing. the and to we're levers Splunk it been been for that to easier two does Splunk Enterprise.

Gregg Moskowitz

Thank Okay. That’s you. great.

Doug Merritt

Gregg. Thanks

Operator

you. Thank

next Our Piper question Jaffray. comes with from Andrew Nowinski

question. You proceed may your with

Andrew Nowinski

start impacts Okay. Good licenses. perpetual a on to would from I end with the of the clarification the afternoon. like

flow are consider? we should revenue impact customer factoring any you that the So, that decision potential I from impact. in churn understand cash But any or

Doug Merritt

some indicators Yeah. chunk X.X. working forecast the the was guidance to In pricing going we're the is decide, yet. perpetual, if from just of be takes. the to of on anymore. that me forecast drove, raise that that the offer will not A to chunk our puts that happen overall and want that not I is people business with, don't understanding both what the going There we’re we done early we do I've you're pipeline that

not any November perpetual we're new of and have retiring sales until X. had occurrences broadly it's those known We but yet, not not

sales to in force the sent an investor our and we've made to checks some and internal the out over memo So its guys. channel you way through world partners partner

we what driving So will the want us in insights, way gives feel It us enables Splunk it's think we both positive We to Enterprise. guidance -- for data-driven QX. to confident a actions, from the and immediate with data-driven -- for and we're but believe be been the them there's which customers. that thing, And very starting element, for asking general, that happening it's in an they more outcomes data-driven want that, more it they've in is more serve not that and that them still

Andrew Nowinski

I could your how if specifically then, just models you. was you. All on And have new competitive your rates? Thank comment the against impacted perhaps landscape wondering Elastic Thank pricing you win and right.

Doug Merritt

Yes.

exposed win north out and for me to I think against pretty there. me also consistent but been the rates of rates like win means that Elastic very a XX%, excited, and your pause opportunities our reporting high. that said look are they give makes over is just that what competitors not in we've you're being the one concern of are remain I've all when things that over average against

I afraid people is things really the are the back, that's that of price of holding think us about one Splunk.

data-driven quantity for again, I you worried value metric. a they're It's of euros about the whatever to meet that customer a fair Because, dollars I've says, not or the or heck with price, not so I'm am shipping yet this getting much the exchange is. the

fact know, data They're saying, that up. out going of the like because we control, the don't the volumes all feel are I I to go

hope that super accelerate would to I continue rates that this and substantiate win So I will The anticipate rates. or those see win are consistent.

future, resiliency my next-gen high the important data scale, with I the deal to with my population or enterprise it, is of to my that my very playing critical with externally large is features around internally corporation absolutely based something I and or on to allow my I been right Splunk. and and critical how bunch is need a functions with me resiliency, this need different infrastructure with and future, I've and things of cyber to critical realize future is

the the enterprise that try has ultimately, journey a it many very so our we license way understand we're of data. all XX that very to doing data for years. understand that bread-and-butter make better, more complex Companies through power quote. really few but X, which are those is and the We The first from can able of XX, these the really -- Splunk landscapes day, per petabytes are been

Andrew Nowinski

you. Thank Great.

Doug Merritt

you. Thank

Operator

call Doug now would like I back the remarks. further you. to for Thank turn to over any

Doug Merritt

I really great questions appreciate on the call. the

certainly our said, but picking to just We recorded very team listening I on may I that not proud are, of out to wanted And be the call, as the QX. SignalFx reach basis. a to

have We Splunk team. join you overall incredibly to the are excited

for I of we be every that have, so that the think customers. day. extremely consumer two our single combination powerful appreciate the centricity guys I much you would live us the

fantastic of people And And customers joining way an organizations Splunk you thank to new to lot folks, at you're we're their It's excited that A constant customer other end the group coming And for October. and going up our show. and a out to all share. there, support. out a of of through of cases see at everybody natively to like be in found stories the that .confXX you really acquisition. run use motivated

Thank get So, please find have a there. a day. you. great way And to

Operator

have This gentlemen. disconnect. and conclude wonderful in Thank and Thank today's participating a you ladies day. all Everyone you may conference. does for today's you, program

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