ZEN - Earnings call transcript Q3 2017

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Operator

Good afternoon. My name is Kelly and I will be your conference operator today. At this time, I would like to welcome everyone to the Third Quarter 2017 Zendesk’s Earnings Conference Call. All participants are in a listen-only mode. After the presentation, there will be a question-and-answer session. you. Thank Instructions] [Operator Mr. may conference. you begin Cabi, your Marc

Marc Cabi

Thank our third and good Welcome to afternoon, everyone. quarter you, Kelly, XXXX earnings call.

report to pleased solid for results We’re this financial quarter.

and are on our Gomez, Officer. Svane, call me Financial the today Joining Founder, and the Chief CEO Chair Elena of Board; Mikkel

Before into let the me few along a we get reminders. results, pass

full commentary. Our is at available and shareholder investor.zendesk.com, results letter which details our

Securities development, statements, factors effectively. The in assumptions, growth statements could prior these of today’s and or actual risks ability law. to our financial our release of call, including such and results forward-looking and in Form our are except and today’s to to as course Form earnings subsequent section results presentation conform information after forward-looking Quarterly XX-Q Report to in statements. make earnings future press Report ability We statements that contained today’s our filings recent our by refer the update undertake the and to Factors During Risk on most regarding as on upcoming Please performance, the no obligation affect attract may for to expectations, Quarterly statements product more with prospects, to and XX-Q. Exchange and retain required changes our our release these regarding we Commission, or actual customers compete

financial The our as call, GAAP should we a measures. from in non-GAAP non-GAAP considered measures or information. GAAP isolation this in During will both to substitute present be financial financial addition not and

this of of to I earnings those introduction, Mikkel. shareholder and financial comparable measures financial over investor press including disclosures for the reconciliations which You would earnings With certain financial website. the press letter non-GAAP non-GAAP all and today’s in in periods available to like it additional on measures, could prior find turn our are release periods, results GAAP regarding these for prior releases with

Mikkel Svane

continued we to growth And in made the sales welcome, during much, year quarter. revenue We continued end monthly A a Thank our enterprise key plus we achieved quarter versus revenue of you third and are made seat the from second activities rate results of advances. our XX% very strives of business upmarket class teams that productivity, percentage metrics measure our to so our as everybody. Marc, The strong ago. the to XX% recurring through proud from rose support reaccelerated mature. the at improve We our this year. XXX XX% customers

ago. organizations. annual deals larger in pipeline of our value expand a our We also compared contract signed recognizable and in to stronger with organization go-to-market and we as and $XX,XXX at more a come more and business as in larger least brands demand many see year These traditional position is improvements

our our advanced we of versions front, product offerings the and On with chat upmarket talk products. enterprise

for launched Our our chat marks channel serve group guide, to in we reached customers. has product a October, customers an as we growing released Within product conversations. recently self-service which messaging More includes internal now sending from of their milestone. for a customer message used Answer high serve adopting received number Bot, important to recently

We are employees X,XXX now worldwide.

an inclusion company using efforts global as and redouble our across diversity are to milestone opportunity this offices. We our as a

and $X improving this in deliver to business for far in confident so progress grow. makes plan XXXX outlook the our Our objective rest as to we us billion year year continued our revenue manage our for reach the and to of margins to order

to Koplow-McAdams with software Hilarie success Hilarie questions, Year. the I acknowledge expertise extensive and with member Fenton, we enterprise our continued our XXXX, feel we and share attract of before New look Salesforce, and within us in once. from our customers, with at the to who new your more business we portfolio, first grow leaving service confident nearly forward take welcome board. end brings our our Director advance our expanding new of And and and sales As leadership Oracle. ability product Intuit I while you want is foremost the Relic, with board Peter her now long-time to executive New positions past existing

are have very joining So we Thank Hilarie happy Hilarie. on much board. the so us, for to you

the helped a from helped he ones very XXXX. worst me some and Benchmark best us the be He big always Peter in my You company has learn me as and company. me and make resource already to of my made importantly been since the good back of helped incredible the the me bad our and earlier keep both difference. some to sales decisions, joined company let of forward. and more an stage pushing and very the Peter

your everything, leaving continued are you the keeping So to we friendship. know though touch forward and Thanks even thanks where for for Peter. and in support tenure And the here continued you you. your look on we We really your Board live. Board, appreciate with

thank So so back With you. note, that to on Marc, Peter. much, you that

Marc Cabi

we for Kelly, questions. Thanks, will it up Mikkel. open

Operator

Instructions] first Blair. William question Suri comes Bhavan [Operator of Your from the line from

open. line is Your

Bhavan Suri

to seeing. I just you on that sort touch the wanted are cases of use

outside the cases of conference have interesting and support So some seeing the of you the enterprise use of sort helpdesk cases. past customer sort at in we attraction, really solid down are of type use traditional sort guys internal user topped you and heard

customer cases, in uses piece And seeing areas? and that growth? Is outbound the sales Just still you of wondering you to other think predominantly driving what's than and more on starting that sort are use of are support see about the Or broad very customer internally? of marketing sort focused as more you non-typical a then are you view? support

Mikkel Svane

This is Mikkel.

definitely it's to And together almost like fair customer customer internal is and and traditional use really experience to where associated let it engagement IT marketing, in expertise staff, IT relation. we cases appreciate but I have experience. and help traditionally providing becomes the roles, we that world also where changing. help think it’s is can we sales, you changing definitely engagement and customer on cases is when had And a all. external sales some what service used focus really use sometimes more some sales the kind use more cases, to on management more really the internal management are can that is things infrastructure their so then the interesting about interesting we interesting and cases, internal from for think see proactive about at our service-like success do and thinking share If about But they really is transform the those. of account managing a for some larger almost anything being cases as for assets use more that them we've we employee and our and work -- These service customer these like products your how employee your we product always them can strides like or our more shy we like website. of can that not and Like, their cases managing much internal then try them. how inflations service are really other use more use and all them there of cases, away are with through we forward-looking, some used we provide and things that affecting are through tremendously yes, to -- employees organization do our from as

Bhavan Suri

from me. quick And follow-up Mikkel. a guess just I helpful, That’s

management that to. customer touch expand sort think AI So bots of talked of But the be built sales be product. given and management, how move of is - they appropriate you the as does for think sort points sort would We Any customer ticket account product. should a the Thank which some answered, you. support, self-support-type and you you are Bot guys of thinking in of of just technology color which drive? into you in about like think frequently, some some Answer sort how the sense great customer how sort AI of about to using area about That’s bots how responded account or touch are I helpful. end, a should - using of guys be

Mikkel Svane

is the to as customer helping Well, I the principle for that the same anything basically are goes there. to think possible we that information trying services, information -- customer-related I as think get the on that easy collective them guide customers the own wide do to their using

that and Bot you powered product, what and with customers are time be see we more there like more more by information acquisition, like stuff and in Also, and and much with outreach that will the learning bullish about collective by So are lot really preemptive would our proactive in to doing also outbound to our model. using machine with connect of very do we also products. stuff can recent powered more Answer a we that be a

investments board. believe the we experiences all better to So used be will that be customer across -- can these provide much used

Operator

line question of next the comes from Your MacMillan Ross of RBC.

open. is Your line

Robert Simmon

Simmon Ross. maybe wondering significant in pretty some This some for down there cut QX helps? is one-off down - Thanks. were was that was there Robert a if in That’s I growth.

Elena Gomez

to is full Ross? up guide question, Our year

Robert Simmon

XQ. No,

Elena Gomez

For XQ, yes.

continuing complete our to for So still still is we business, confidence There year. strong. to QX. to definitely the close guide some aspects actually improve and the in we position our sales well our confidence in have full have productivity QX We raised seasonal us but

Mikkel Svane

quarter. set just close that we transactions move Yes. larger when guides remind predictability each everyone and upmarket linear to kind a probability represented throughout whereas we around I assign very quarter, business, guidance, our which how And the as high that’s convenience Robert, of have our less in and would set transactional we those to business

Operator

next the Morgan from Your Stanley. of from line question Stan comes Zlotsky

open. is line Your

Stan Zlotsky

certainly big excited year-on-year specifically big So going QX into fourth enterprise shareholder the listening and to out and very reading of productivity pipeline you Mikkel are it into call the your going pipeline. seeing confidence this you in -- the this sales as quarter? new that’s force sound as well certainly just you this the opening just important sounds letter, giving What about

Elena Gomez

that the of So numbers of in around about talk obviously the we we you back hiring and talked -- some little half remember don’t a productivity, have this QX. specific did we year but last about part Stan, early we last bit if quarter, seen

to out begin and focus we pretty were are force QX to we We the a of in execute able it that change will over have the consistently quarter. would continue quarter. our given the continue sales to begin QX, was had some Our to in of throughout see really some we proud expectation and productivity which that that leadership play

obviously, basis year of in to. a business, a consistent bit little to our half probability challenging were little I've a of consistent and pin as household In is those on that for The to on that alluded in why basis names. more household more see close, it's over and we’re Mark showing more but which names terms when pipeline, predictability the thrilled pipeline starting that a been pipeline company a at to lower we’ve see us put is in exactly, point more

Stan Zlotsky

And something in guys you maybe newsletter. that dig mentioned shareholder to into the

Or you unified So future? of start are offerings on omni-channel you touch would the make for channel What us basis, to offerings. the address could the review? communications the going Can in that press representative unpack you in to our that major all you products opportunities future kind products that little into collective there us? for you omni-channel that to could you be in and a mentioned big have until offering a be bit the hold that these daily bundle letter customer service

Mikkel Svane

next into and definitely internally products, like the -- really year, experience. is we of a ease about the excited seamless - there customer seeing a providing you a and with experience extending omni-channel tremendous are perspective something from to the that to we customer it's is both -- these of can told seamlessly amount these but want we from together we’re providing this do very of much by just build lot and work believe products use how And we about kind like more just

and are a talk better and attach something customers to up products we with going about see and some different for the experience to everybody. that's of new opportunities go also provide for for So it gives much more rate some us type conversations

companies. like So of think lot for that we've I doing been

think and streamlining mainstreaming going that more much I are we at looking forward.

Operator

Wood Derrick question comes Company. line next & Your from of the of Cowen

Your line open. is

Derrick Wood

and you've to are then what that you sounds maybe or year see you made It this for like investments you so? territory-based build sales laying over as next foundation give in strategy guys us expect much color up on progress the the of fruits starting how to teams. the a a the sense just as to Could little

Elena Gomez

Sure.

which change have upmarket we sales a right, we as customers. are conversation view finding customers, organization were their longer we out, you little seeing needs to So solve about our territory-based helping engage they made move as to allows with year ago sales over them a a deeper build how is us taking leaders what are a our are have relationships a with their those and and

So that’s have definitely seen. see out we productivity the improvements translating enough where is playing that we -- and

we often enterprise times model We Especially very those keep that change are to just as the have future. consistency upmarket, but with are consistent going trying are with we base organizations not future. for for foreseeable and the it’s in customers we that really territory to we territories foreseeable to sales continue as only years territories our committed move transitioning important

So executive to we often. customer very out not relationships changing are

to trying hold are We that steady.

Derrick Wood

as then to early going to and more is a deals? solution land-and-expand guys and the what come back can multichannel deal for much? shift maybe And so us sales after you guess change towards give how expecting takes but this more And I expansion into are sales you a between an cycles you looks I Great. too cadence model, sense a mean it like model long tell, environment, sales initial

Elena Gomez

earlier enablement expanding your our move But sales -- part is you that if sales have much. in priority our not as we have guide. So sales extend cycles and to the year we a engagement don’t consistent as conversation right, anticipate wholesale upmarket, we do that sell so can lot we’re about beauty that with are making we we to territory big you of manage sure of model the customer, so a have next we We that’s are the for solutions to engagement, cycles. invest begin predictable, those products. you to as sales try are selling know, -- will But new that and a we expect not in we less have cycles customer you a change will but going us to our in that in factor expecting

products. fact, hoping we are just that adjacencies we have natural In are flagship what products additional is really the our support to

Operator

Jesse Goldman comes Hulsing Sachs. next question line from the of Your from

Your line is open.

Jesse Hulsing

if in like the more second am you seems enterprise bit of customers is is a going Elena, that realigned kind I enterprise guess kind up? and the you floodgates sort it I the having you. quarter than well, the look force it changed inflection of thank this of there Yes, that something there mentioned the so I business? that win to opened pipeline of to up we in the totally and less sales function what’s rates the far household as and changing little extent dense Is nice in and think I of just in wondering an I in are Are quarter enterprise segment, the there. Or trying technologies that’s types to thing? other and unpack the rather in seeing am bringing market and vendors? Zendesk are they’re attrition adopt as looking just as

Elena Gomez

Yes, things. of a think couple I

territory-based at that -- a disruption, I year and definitely bit helped think little model to translated. recall, one we last change if has that we so a had of made we have and a you thing that point the

also think translating over around think all us. is really our I BPs. the strong helping turned into globe, think which have and I regional we consistency I that strong have had that’s They in not leadership

continue of we is and success enterprise evolving to little and our into as as cases, As next customers that product that But install starting think use get starting I adding a more it’s support think early our we their will are to -- see not and well. of product to are I bit evolve see year both. we to we

as Our is stable for been almost good now a improving sales our well has product year. as

Mikkel Svane

about Without of that, we expected. kind Jess, throughout kind of of Yes. have and of is one like the year, increased our talked -- just seasonality to I And we that any like so add that. diminishing business

that Some end off them to by deals the of enterprise the this have that and of we seeing year. more the like we’re used

Jesse Hulsing

that products stands like it pretty product at out number I new Where And other know you within quarters of of support adds -- each most there? I it couple seeing looks if last Or your base, outside of look of broad-based? is the but and that are just the chat, you've net their a small increase line. attraction it's quarter

Mikkel Svane

you we very our for as lot our as looking selling know, Help kind that features upgraded It's some product monetize has of has version to self-service. efforts is of an of It So Guide professional their efforts seen Guide a Jesse, Center, customers adoption. the and good around part with version a customers. now support of of are

talk that But some sell very our on cross strong chat is are and very good uptick. now. right also So seeing

adoption And our nicely for is rates and third so growing well. the existing products of customers as second

Operator

next comes Zukin the line question of Piper from Your Alex Jaffray. from

open. line Your is

Alex Zukin

I competitors’? pipelines any competitive wanted mid-market certain if the to or the side and discontinuation you sub-selling about are the environment from enterprise on or seeing either products first side to your boost to the your specifically of ask

Mikkel Svane

and days really period to a in have up might to always that really a for does product and well provide their weeks. on not and customers those competitors’ for a receiving investment had be running We've way. our very a can really of replacement that customers offering We are for. Zendesk customers the fit strong the We looking the for our mid-market so and of transition nice quick products ability

feel grow transition to we continue And nice that are is transition going for they with also a the to them. them. secure So

We are cases customers of have our a started they or with of thousands agents. agents now and multiple lot where X use and hundreds XX

scale a small have to mid-market lot enterprise. a ability the of So for demonstrated we and customers in

Alex Zukin

And be those some maybe that… a XQ, you little of then products letter mentioned maybe one for bit and referenced the specific In increased just for are that investments some is to about you guys maybe a shareholder that investments going earlier can you areas more Elena. what

Mikkel Svane

where referencing we we invest I to continue see it to success. is categories in is that success, what to as have think those are going we continue

know, you model built what upmarket reinvested well territory to solutions we letter. us is as we've to lot the solutions as investments the as selling that's work So you are and for that being move in in placed arounds our emphasis consultants more on we added a there. referring things move our as are towards we We've shareholder starting

Operator

next of Kash Merrill comes Bank Lynch. America the of Your line from question of Rangan

line Your open. is

Mikkel Svane

there of other I re-pull couple let’s put in Operator, are back the We’ll Kash? know calle. him. a queue. them

Operator

Certainly.

of line Your Hynes question from the next David Canaccord from comes Genuity.

open. Your line is

David Hynes

to of bots be a can helpful help that Can thinking the take? kind be some you is or Hey Bot populated shakes related base? populate really product, thanks, questions that guys. thinking on Answer about what does there. that that would of burden ramp about prepared does results. scale? the in how of long How to a bot? in color really color How them then need was base so on needed remarks. guide It is probably any knowledge leverage Probably I And the that an couple and customer interesting And dollar seem guess that knowledge automated?

Mikkel Svane

has information our that Like, bots. to be can be navigated there well-structured by

auto So this is knowledge it’s none of created.

much part and our with different bots. helps offerings That source have also guide we and auto is from that productive producing products. We knowledge have these agents tools our of new more be guide

the distance very, creating So published between having them very is they actually -- articles and small. kind

an and all most we tools and build and helps make structured ratings what’s publishing to So the out with these it it et there thing content what’s just super make way in used kind et efforts put structure try most of easy popular to minimal cetera. and cetera, that of easy

Answer our Answer we all even that on knowledge some to base and trying will Bot et which we parts it customers and Bot have, of knowledge customers how knowledge model much volume, of Answer kind can though collective with react make work. means easy level content data possible, most ask to need So -- kind should Bot of up that based of for and put make is as comes without be structure easier some we efficient. the they to. that cetera, about cannot Bot Answer the some kind like as of job work et But consumption a level some customer creation But to it are how question, cetera of you also needs

put that’s algorithms the why to customers. and of it our think and I and easily most more it machines we’ll more relevant more to time and and you then production You can we we’ll for should and confident more also like low and feel help beauty set when more and get in and And there and and efficient like asset customers’ in learn how time customers step over for we about be the into that and more content the the it’s that’s learn will it more the answers. new more more more threshold be kind be over where confident and these more relatively provide of can of

David Hynes

Any Yes, International, on efforts of about it I in a quarter. guys in. color think Japan, internationally? that’s helpful. take you kind you Maybe and can address one Australia more talked what any lot are sneak Brazil, question seeing you one. Open-ended if last could new-ish I

Mikkel Svane

make internationally time. So incremental investments we all the

have smaller over we we a of subset XXX as a those countries customers in and a they weren’t in larger know, invest investment. you As

grown our can we we that what India, each a see Brazil year this of investment, ago, markets. as years success demonstrate we Japan past those in So is couple and has of

works. We're our really team from seeing good Japan. in the We have new output that model

move we are us because as we upmarket. create And critical market, for those so relationships exciting in is which

Operator

Redstone. of comes next from Your question Summit Kees Jonathan from line the

Your line is open.

Jonathan Kees

can they I gross question an in up sequentially. if of guess picked terms incrementally is, get have margins, I first my update

your under And in still your your continue doing about what work your network? sells format, of terms think I with to with AWS into be or own consideration AWS buildup are hit of to we off in of development there XXXX? you terms with should guess Or So what is margins under how terms in be gross that going plan that's is?

Mikkel Svane

So stated the as bill continue colo have we early in to we infrastructure at pass cloud point. and year, a this both

letter, As good and we will are we customers we you'll to way February commitment proper be with see the more the that to we and be through we in a you our in infrastructure. work tell will in shareholder infrastructure -- able QX we next. a moving cloud making how the a cloud timing transition when about outcome, of do meet But quickly to in we

Jonathan Kees

as are even question terms what have them you pushback products your and partners in to are from Or early have out any my that tell? getting think to I last some of out still you you of now, overlapped is, terms it like you currently roll rolling of work And too referrals? new you in with is

Marc Cabi

our take to our things it. in now to and we our continue but own like we and even in partners partner really duration it's kind we we like that going are natural we have also really and really that offerings. of bump can though and guess believe to that And I support we take the are going our offerings we partner offerings, as It's natural will into believe that believe evolve

if products, product that our Like, with can make example own with our it, also a XX for our product. chat the a we are that different experience same provide our so we top product. partner in we you product thing use seamless chat so maintain you and same the So addition using

that also If want make have you to be as with to sure give for on our like to then seamless is as ourselves. we We want try that and we to amazing course products our always so you chose also as dual -- augment our as be try also do, and build it some time make in really where products product to build amazing at off to use can we possible want as good investment the instead, our we we But our reasons partners partners as are to possible. strategy platform platform we try choosing going products. a inclusive the partner same we customers the experience successful,

Mikkel Svane

part I customers. to want it's say to our great transition go answer my Jonathan, to When my just to sure experience quickly, as cloud there. infrastructure in our as is move of for back want just terms we that quickly possible make I of and our

Operator

of comes Brent question Markets. from next of Your the line Bracelin KeyBanc Capital

Your line is open.

Unidentified Analyst

of you This is Brent. the inflexion going large on Is there something like is kind had [Selasa] it new really kind causes strengthen that if in and math I on something new where around deals? you that about really did attribute all subscription revenue. around, to kind , some on else talking from looks My of was new we your customers? Or your question of side are subscriber

Mikkel Svane

and we on to our extension quarter, or always a had our product I new in quarter. Matthew customer in especially We as product. guide fairly good have am but say looking mix this of support additions each

are new you balanced and determination. with. how model probably expansion making the that’s have a that So fairly we we bounds that’s But feel of within what comfortable

Operator

next your question Kirk of from from the Evercore. And line comes Materne

line open. Your is

Kirk Materne

continue sort partnerships more as with that and portfolio system offer customers, how broader company of you to curious was service forward all I evolution. integrators products your transition selling a of broader of to to I I as to factors guess into have sort when and solution a look

them need, was more Some own actually of customers digital more bigger was with transformation with your interest bigger competitors a system integrators evolve. partnering but more There need is there in there help or through their more the get journey. to

color has your portfolio am SIs would has any just just up I curious your on kind with I that bigger great? of So picked broadened, product dialogue as if be guess

Mikkel Svane

model yes, increasingly with I part picture say bigger make becomes what can of of as we engagement Well, that. of increasingly last our upmarket them an part the years, bigger Like, over our couple have successful. the it and to customers moved

continued So easy upmarket high of being to continue want part really, implement to to that important to and quickly. to product as increasingly in I an grade really it’s ours. going we it’s a do become move roll out say

some provide So the more can the of large definitely joint we come that of very of that it kind can is of projects with. a with and we But projects important towards it’s that joint organizations needs we offering set kind different becomes these as big. nevertheless, and engagement of it customer into a provide these is much a partners

Kirk Materne

sort color things Okay. laying be getting And is addbacks. a about the you fast staying from you in just the are great? hit I your terms of were can if can on deal getting through. that add it longer think being front on the they there right the there sort pipeline everything would way around I how the just people of two you addbacks seats on improving, to in just any that moving or of take that rate front to Any efficient terms out in that is was of wondering of in end assume Thanks. on of amount one productivity the versus of your much direction. just, those more are there extra is in sort commentary sort any of

Elena Gomez

we mean rates I disclose anything like don’t obviously we close or Yes, haven’t -- that.

there. shift major any seen haven’t We

of also the all us and proven sales in our are better seeing customers really for powerful tenure I just force to be qualifying regions. more we think is ramp has more what productive but

motions heavily we to our is we have that’s that in as landing our very a did go I think expansion, net rate, out of think balance really the back played expand too for of do new but tell I territory really kind you QX, and other well and pretty can from model working the a thing expansion testament us.

Operator

question of next Your Philip from Fargo. the comes Winslow of line Wells

Your open. line is

Philip Winslow

forward? provide you as see additions. don’t behind us the this told sort release say, about benefits just just of the was and kind just of guess things how the to you drop you repackaging I talk, and you of chat and why you going shareholder and enterprise One of think what we color what and that in do Then more in for the

Marc Cabi

excited small and a earlier, where products larger talk continue case. a can chat our base, small of customers our well to future goes to and the Mikkel an close where of be that off of times each lot or all intended from larger gaps. into efforts able all point going address products talked else of the enterprise our based And and agents. close are overtime going of to now with especially a customers sure to sets they sit are we're broader there our said with side-by-side were to our a And we this kit so we’ve are capabilities. started other for used work to certainly have segment larger over very were base be small partner required products, they with past our year all someone can as and making customers And two our are future for customers to o that of of and features that products R&D So enterprise-like about the together gaps serve these

we want customers to So able be served. way the end be the serve to to want they

Philip Winslow

the are saw on provide trends And if just international this about can you versus also quarter just some and color how that you thinking the domestic just you QX?

Mikkel Svane

across changes pretty the even make to Board. wanted I

Elena Gomez

today. mean notable. America, successful to is that's continue Maybe we there part I Latin have nothing small still of our it's but business

Marc Cabi

large are growing are that are or is them regions But model market, joined the European nicely. expanded You'll working we we all that happy very territory did our highlight us see letter customers for that in we shareholder some now. either the recently the that in have so

Mikkel Svane

from in just number visits and guess in I of and and quickly. and and back do a really Brazil is really continue continue performance by our there to growing seeing Yes, be LATAM more came to I it inspiring

really coming I still nicely out have up, grow really, us. Europe APAC Americas some seen because also We North of last great quarter. the for continue met things too, to but

we in to international love our are So our and all children grow. see approach we

Operator

Tom Rodriguez line Your of next the from question comes of Stifel.

open. is line Your

Parker Lane

It’s in Parker for Tom. Lane actually

strengthen customers can little that's term with longer of guys with how largest and You to about was opportunities you. talk. your sort more resonating their Guide if chat Explore and the wanted talk customers? wondering you to the Thank and business that and what Pro up-sell of a I velocity

Mikkel Svane

Explore have a still to how acquisition the do. broader will way. BIME taken as out in and about through is that we've to a on We’ll Year getting create talk we process So our going of that the market more to New enter

next really products demand within customers are and understand our Explore more version customers in very Zendesk have for on the from outside. explore to heavily like insides high will step. not acquired to about that Today to products GA do have We that February. in want talk customers our lot used BIME. we as that that both their that the that what to our Explore yet new A But use to from We’ll is of take own fits and we by product.

Parker Lane

really agents you this nice some Should expect we that per have going points Or support see quarter a more. you we in or for given Then or back it. figure to customers in you that MRR from to trend it basis XXX strength? quarter. think the strength with continue that XXX maybe would said Got come a a two expect

Mikkel Svane

don’t see for are always have -- think we we to So of are sustainable, those our and we a what’s a And about basis I commentary. a rate in if us. ahead bit more change so see movement would sustainable of performing going year. have forward, to quarters XXX our great that’s reason for that the and been little you may QX XXX should comments oriented, enterprise Generally a QX more points growth

Operator

from Stephens. the question next of Samana your line of And Samad comes

open. Your line is

Samad Samana

a are million support attach like? if could what those for seats I I understand customers think seats growth year-over-year? approaching the Adrian that us those additional customer was in that of rate products support the help mentioned what curious looks seats. guys And you you looks like million

Mikkel Svane

a good next have really metrics. for we disclosed on of to we year. some next So and Right It about into in cross-sell that now are the year that publicly opportunity it’s metric something is we for potential you average attach our rates. we see looks how allow haven’t guys terms cross-sell how more activity working but happening,

agent -- growing as are ASP we move slightly. we of upmarket, are terms our growth, In we

per more Our enterprise a a starter customers is. agents are than account worth little

seat probably that. growth our is we disclosed And slower but so haven’t revenue for the you growth, than the on full amount

Samad Samana

just as to And that. maybe a then follow-up

a seats, may that the just size to us understand to is big I based company think our what for has market opportunity. Could models? frame be able on help market the pretty you

Mikkel Svane

would it’s from I annually high to our a and I on not I there use the know high but we I of sector, reliance put of industry We do analyst market premise and growing legacy and reliable from amount have an seen -- number which spends single out is that have never on. that that about would benefiting numbers, is a billion put conversion seat a what seen not cloud, our digits on $XX today. kind to large are opportunity a

Operator

America Lynch. of Bank another we from the have question of Merrill of Rangan Kash And line

line Your open. is

Kash Rangan

in sales attract first any do market, going you. gear changes They do get see all it’s your better end goal? How out billion evolution do your thoughts and these million become are playing be on to to and to and business about Thank goal you curious how you revenue and XXXX. every for you am I go of what s are company mix broadly front update in always process. get have see learning making to leadership steps the go to that you because larger. through billion you How things dollar you the you strategy move growth toward as XXXX, changes go-to-market series on change see to of

Mikkel Svane

wolf. the for fighting all are We

Elena Gomez

a so, point. has I good mean, think Kash, I

so organization, reevaluating grow the we're everyone it. always think you success is right and now for seeing sales I us in as is territory

to We are continue that. with going

are We of news and model doesn’t but are the to for we as we find we where replace stick least to and won't continue that I are may may more on mean we we suggest forcible as think Brain we're hopefully the to future, looking you deals. our getting to in move probably are stick focus going change we meantime that a obviously well sales the to It in it with because right improved on for meeting at have. have and going market evolve ahead soon. our productivity to will position But larger we that need now we

Operator

time. be And there seems at this to no further questions

Marc Cabi

for quarter. you to we great you well. will your in Have And interest evening. a next right, talk Again, Zendesk. thank All we

Operator

This concludes conference today’s call.

disconnect. You may now

Zendesk (ZEN) 2 Nov 172017 Q3 Earnings call transcript