CLDR - Earnings call transcript Q3 2020

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Operator

Good afternoon. My name is Elaine and I will be your conference operator today. Welcome to the Cloudera Third Quarter Fiscal 2020 Quarterly Results Conference Call. All participants' lines have been placed in listen-only mode to prevent background noise. [Operator Instructions] Please note this conference is being recorded.

Vice Development Cook, Investor Kevin host, President, and Corporate Relations. Your may begin you your Kevin, conference.

Kevin Cook

Good welcome afternoon quarter Elaine. you, Thank and XXXX call. of to conference fiscal third Cloudera's

release results We Murthy, discussing are Chief and Jim Martin Interim From announced Frankola, issued and me after Chairman Product Executive in Cloudera will Officer. with market the Arun our Chief be Cole, Chief today. closed Officer; press Officer; Financial

future of this Hortonworks, future call, we performance forward-looking including make company regarding words the are generally identified with course will events by of statements those and believe, expect, that the and the as anticipate, financial statements merged other the future of denote use During as such intend words these events.

the material actual could uncertainties could those factors to risks cause on fully Annual detailed forward-looking Form caption you materially described release We from risk on more the are in results risk These and results materially call. Factors in the and Risk differ in our release consider to XX-K. are this forward-looking cause forward-looking statements. to that press statements under actual those in factors caution These Report are conference that to important press from in our statements the subject differ and the

on other reports filings with Form our quarterly XX-Q and Our the SEC.

prior of a Cloudera's performance. to intangible superior consider Non-GAAP During a numbers presented you for company. since be measures this acquired information call, combined Except reported non-GAAP is not exclude for substitute to standalone the These measures financial measures. compensation and in comparative there our and present basis analyzing all stock-based and on considered we both no year-over-year financial we for when from, intended results of encourage GAAP assets. Cloudera will where measures non-GAAP noted, periods isolation expense amortization financial or GAAP for all to are

a most measures the results. press to quantitative on please figures Form The report information, release GAAP refer regarding release reconciliation complete press been directly of to quarter financial and those also information our third non-GAAP part today's current furnished comparable as has the For of our X-K. SEC the regarding

please addition, are December XXXX call we on forward-looking believe assumptions statements Xth, make any and this of we is the conference that In date. based as this reasonable to date note today that of be

these We statements events. of update as information result undertake new obligation no or a to future

Now Marty Cole, Executive and Chairman Officer. Interim Chief

Martin Cole

Thank I'm momentum quarter we XXXX you Thank our you, very us QX, third execute year for to everyone. to generated fiscal analysts. and we industry in report Platform in as CDP. pleased Kevin well the on and Building operating and discuss the well-received to that hello, financial joining results. which QX. by The the been Data customers, Among results and partners we across-the-board refer launched strong continue has highlights, to delivered launch Cloudera

As in changes. and also licensing we're business is performance. our we previewed our having distribution implementing positive And last on a call, impact earnings this

Over And partner CDP Cloudera Connect. well enhancements we announced the two Data available last to our Center schedule. ahead weeks, program made of

to experiencing for continued XXXX. fiscal flow expectations number And accomplishments performance, leverage dimensions. team of improved represent These ramp across our In good all we're cash business. in the towards its moving field quarter, operating positive and progress exceeding substantial operating a the

answer Describe recap introduced Cloud Strata our any the During the available Data Conference Public Center. session Q&A we've be specific have. may you will and made CDP early this Data help will it CDP announcements during us progress to questions call, CDP major with we Arun the September. in

these XX% $XXX million. With the year-over-year conclusion flow at and quarter revenue of million Subscription was expectations. third the results was regard our of million. to $X cash revenue negative Each million was exceeded financial QX $XXX performance. recurring representing was Annualized Total $XXX organic operating growth. revenue

XX also quarter And ARR, a customers who XXX increase terms We customers. exceed now of more million we of XXX adding of had than greater $X total. to customers have net $XXX,XXX of another QX. had impressive in than ARR in increase in representing good in We an

past Their roadmap. been to and I've largest on ground It I've our had noticeable satisfaction stable with directly perform with to with continue time This gratifying mission-critical our among high to is As CDP the our level their spend over opportunity our few products of use the quarters, significant. engaging customers They the partners. is and and products. remain our particularly enthusiasm customers. for cases gauge is

Enterprise real. that on strategy customers, market with and Cloudera's time I've further my is the been target Cloud For Data is convinced opportunity

going two major now with made September. to Data Strata product and We announced am to progress announcements recent CDP. turn in early I the conference at our

we of securing offerings set Public for Cloud highly These environments. all Hub. a With First, a for Data single Public Cloud. CDP represents managing three and glass differentiation Cloudera self-service a key services. Learning provide Platform competitive Launching all and Data cloud-native cloud-native launched Machine of data and Cloudera access of to Warehouse, enterprise analytics. Cloudera Data services. Cloudera pane easy,

these on offerings governed configuration Cloud multi-cloud management any customers market platform different hybrid us our solutions today hybrid are from a the services any run want than tell data CDP discrete are cases are to CDP that other Although in and prefer. cloud, supporting is made AI. they functional the capable. customers with in Edge any on-premises environment. to CDP comprehensive the analytics of and array multifunction CDP broadest the and and Public distinct enterprise-use and fully capabilities secured offerings, across of is because has multifunction, is

shared unique. source, Open and compute experience, And through open SDX The technology open open. is is storage. data CDP delivered our

told most Amazon are workloads. both these are in Microsoft the they Azure available determining cost to services and on have value that and how optimize us today CDP customers factors Our Cloud AWS. of Public performance

as representing next-generation new significant strongest secure of innovation major Strata CDP platforms, Cloudera Data the and the offering well data management. the The is elements enterprise Data as Center. on-premises at for announcement Center former second was of analytics introduction and Hortonworks CDP our

for compute ten delivered store scalability also that Ozone Data named Center on-premises, and better to as performance. improvement over a for differentiated code object times storage can or that virtual files of more objects private based billions CDP technologies than new It preview scale clusters such a and of includes separate HDFS systems.

first security easy. from governance extensive built providing Cloud, of infrastructure. testing CDP base testing. setup data, Center metal delivering in the hardened and is as Importantly, same security stateful cloud the Public aspects, and also The makes both Data metadata, Private This And in and code platform is clusters on managed testing, Center Data bare benefits analytic the step Cloud. the of CDP by SDX governance CDP all CDP

learning the for became in foundation Cloud. is impressive and containerized traction promised. In seeing of CDP and is Private November earlier experiences Data Center warehousing, more. for for Cloud XXnd pipeline. Private our team. represents for It machine CDP a built metal hybrid than ready cloud, We're on available Center nutshell, effort for CDP for bare already part the Data It on significant it another our optimized engineering

before Cloudera precise Clouds Cloud. strategies. their Now hit response Public waiting CDP see have CDP composition, been the and seems functionality Public Many led of to customers have let's data cementing the performance customer mark. review to to early the CDP

our are QX. Its Just was launched leveraging fiscal who It plans our are as demonstrated confidence Cloud. to renewing Public in for inspired a CDP was results And catalyst infrastructure. has CDP adopt customers Cloud publicly customers reassuring Public QX. these considering for with customers in to

that implementations. well-suited As with customers for hybrid a cloud workloads result, we are have targeted existing

large rollout customers deliberate in very customers. a employed ensure of success Public strategy intentionally early Cloud. expressed have who early interest these for We with to began being XX adopters help CDP We

Cloud. offerings. launched, more limited was XX and waiting there the advanced of XX we list than live XX the of who When testing customers of intend indicated to original of CDP and trial have a interest to Public usage

utilization learn by our customers can As phase. of to for We of the of evaluation we been of large hybrid queue. identify have XX collect to and cases. the have services first today, cloud enterprises concerning and the software We areas control these feedback use want to we from any the like the order everything release number the in multi-cloud a added improvement. especially transitioned chose to And through

received the The pace early following overall studies progress the of Public been representative CDP and encouraging. are has feedback Cloud. of with case we've successes The we're seeing

to financial company. delivered performance provide differentiation. they also permanent multinational and services have as and to data ensure overprovision They provisioned the a They is service have clusters first is customers governance security has been the applications cloud typically capacity. a expect The the their that they

trade-off result, governance As costs. experience against and a they constantly customer

Their have customer lower And security, to by costs. to experience experience. to eliminate CDP's customer they research compromise. is with workload a With SDX, CDP, and biotech With governance customer they CDP's The don't can case an CDP, deliver they and deliver next engineering to need over-provisioning. company. without optimal a is complex genomics management enables sacrifice with queries. them ad data hoc great driven get experience research-based the

CDP for analytics considered alternatives, next-generation became cloud-native choice reasons. they clear As two

use at which down First, infrastructure. need the always has Cloudera up and data and excelled. security cloud at second, what delivers CDP and Cloudera scales only a they pay both CDP's enterprise and governance so service auto warehousing And only for their lower-cost.

to Shifting APAC.

better. have found keeps people applications I'll type by crucial their massive and delivering analytics experiment governance. is to XXX together shadow because ensuring to customers embraces innovative them case innovation provider with that of with and you productive share serve It They a warehouses in major They organization people. data of healthcare scientists while service. The control nearly with global seen data of and is faster analytics native security example have Cloudera telecommunication serve collaborate They over is learning CDP's organization. IT. innovative a it at cloud it machine data a next example and services. better. likes to Our rely data bringing benefits and This IT their on to make more to X,XXX already final promising Their helps

enabled their by and but against and warehousing build running with bursting And they easily applications increased lake their role-based replicate these unique and access control, are existing evaluating expect identity quickly CDPs data to security with They features people more new like and Private and These Public across to existing workloads to federation. cloud data capabilities faster CDP, them compute governance. provisioning Clouds. applications instantly

total is response CDP addition platform or Public major to Hadoop/Spark customers, Industry CDP and three analysts a workloads, on-premises I Clouds. said praised software the have data can that contributor, up infrastructure is stack. and Public as quote, spin Andrew industry do the from Brust and And expert and Cloud. ZDNet positive across down of on and and necessary the scale that a demand. manage as data virtualized cluster well the CDP remake recognized In

Industry Tony of rethinking analysts ground experts his paste up, its simply do the Cloudera with starting the offering. re-factoring new connection credit HDFS. saying, platform Cloudera from Ovum storage between added cut Baer to a didn't with and a compute It of severed and and that ironclad and perspective complete job was

options a noting vendors, pricing is we designed and superior and functionally terms, cloud-native have CDP improvements Finally, established and new we it be to while In AWS, Azure of Center. to introduced is competitive from offerings reflect the basis. performance that with that simple our features worth equivalent cloud-only also on in services performance Data providing comparable substantial pricing

services run security, without drive We analytics Kafka is bursting demanded includes mission-critical by expense. than pricing. competitors governance as-a-service customers unmatched. cloud Data Hybrid services sustained CDP believe used is management of breadth is in personnel Cloud CDP unified expensive we're an All-in-all, both and the our solution costs. to Cloud with and course product delivers our provide and required. strong of in believe integrated pleased additional We execution CDP and introduced growth. enterprises cases. value workload comparable functionality. CDP grade reliably QX cluster analytics, and Cloud offerings we've NiFi Cobbling or and at for direct securely, And enables integrated more Public this as to our also initiatives scaleably, to more considerably enterprise together capabilities order similar In with workloads,

new products, distribution a new new pricing, programs. partner licensing, and We new have new methods

significant. Each we business. initiative believe material a Together, will they have impact is on our

subscribers. were compiled these will accessible, Since in there the their indicated their yet know news freely to self-support to time be elected our we this preferred subscriptions longer we as had instead secure that software assess positive agreements. they to to to of concluded This trajectory binaries convert is their example, intention will who than renew age, take some renew previously some subscription of software our customers QX. Also it expect trend. becoming users will released For and paying their no non-paying customers less reliable,

half with price deal closing. compared consistent our Cloudera the deeply adjusting from at QX to improved levels fiscal as in in Hortonworks QX to a prior In XXXX large first after expectations won for churn that very one addition, discounted merger

effect us deal This in took impacted of in most the XXXX. it QX quarter fiscal as year recent

it turn over want field Jim, work of in QX. organization acknowledge I Before the I to to our

out has of to earlier timely field continued to conversion my of the the accuracy in team. organizations shout to The terms execution addition renewals, In improve pipeline and forecasting. engineering

Let's turn your you. And questions. details. to the over we Jim take to now to review Jim will then

A -JimFrankola

described throughout results From beginning financial Thanks strong Marty. were sustained, Hello, was of the that take better-than-expected a early Marty QX to the organization. execution again while hold. solid everyone. quarter our view, reflecting are a point initiatives

quarter million. Because third and for negative $X quarter comparative merger, the flow of was million these the meaningful. cash on items is the for was revenue Operating $XXX subscription million. information year-over-year $XXX not revenue was Total

year-over-year. concerning trends was the details of be existing up Clouds. QX $XXX for renewing found driven and expanding planned always, agreements fiscal definitions in XX% associated certainty than million, higher Public This with the was supplemental customers and can revenue with on by primarily CDP launch Annualized Investor website. As Relations the recurring Cloudera's materials

QX ARR. concluded XXXX QX, and and large ARR customers benefited we functioning. stronger than started quarter XXX who As QX Dollar-based of QX. increase of case the was more grown have operational renewals last XX fewer previous effect with We In quarter. in to QX, slip was at $XXX,XXX execution or was excluding a and that revenue improved better. had QX, the This in one deal churn the from over net than took field-level

Our offerings. expand continued largest and our consumption customers remain of to stable

$X in million representing than XXX. to ARR more increased QX Marty As highlighted, greater customers than of

remainder issued a earlier and operating the results the in income Historical the review unless on results all stated statement, the that of we reconciled As are release otherwise note GAAP basis. NON-GAAP are results to expenses references press today. non-GAAP

of was from stock-based was gross amortization margin GAAP Total related adjustments driven Our gross subscription in intangibles. to margin are QX expenses XX%. by expenses million quarter XX% fiscal to QX. and an M&A limited QX for merger-related margin compensation Operating level from XXXX. of XX% improvement non-GAAP or spending. QX $XX of of the revenue are of with were $XXX revenue, for of Including in XX% operating million gross

leverage our Excluding a results operating were these cost XX% amounts, synergies of in revenue increased expenses QX. These reflect the merger. rapid operating planned achievement and since of

was weighted to million was loss negative fiscal the quarter negative have expenses, points third margin XXX improvement of from third of X%. share $X.XX been compared operating substantial based $X.XX loss XXX QX operating XXXX. merger-related a Overall, of of Loss per X% a in million QX representing in Excluding the for $X on margin per shares an basis outstanding share operating quarter would the in average operating these which X% includes margin expenses? quarter, of positive

third due the to payments. exited cash $XXX securities with and and down RPO We which expenditures at are QX at sheet third for cash line million were QX. other end quarter continued quarter. end liabilities of restricted revenue of which $XXX better low expected Operating strong was third at the contract from top $X on in marketable Total capital synergies. million of merger-related of with to $X deferred outperformance Cloudera's of the $XXX $X merger-related of quarter, efficiency. levels liabilities than execution was includes equivalent These cost million cash, the and million. Cash conclusion balance million $XXX comprised turning coupled with the flow cash flow indicative the in flow. Capital and the Now million contract million quarter negative were cash expenditures

will guidance I QX for initial by fiscal XXXX. for updated year providing guidance conclude and fiscal

in million subscription and We revenue to million. and the $XXX total $XXX expect of between $XXX million range to revenue million QX $XXX be

our Net rollout to the as on support average will outstanding. We $X.XX based services margin next share we to our $X.XX projected personnel CDP. over weighted and shares to to of the of some is XXX services continue revenue few be use per loss decline million quarters expect

For million the million subscription to now be between total weighted and $XX average cost fiscal expect between of $X.XX to synergies, we we $XXX XXXX million $XX $X.XX loss on million $XXX year and share be revenue year XXXX, expect outstanding. range net for Since per million to and of million be $XXX flow revenue capturing to based to cash $XXX million. be shares ahead fiscal XXX in negative operating and are to plan in we merger

flow million year. we Projected merger positive related market, approximately fiscal and the Adjusting in cash of cash With to merger expected intend placing greater merger the $XX for for flow for build fiscal a on generation XXXX plan. our operating CDP emphasis is cash results on be this these payments. includes XXXX are business in related expenses, complete to end

throughout pipeline first As QX quarter, expected discussed half of and last building to consistent in bookings fiscal XXXX. and yield QX the QX is

As revenue raising such QX. we're our guidance ARR and for subscription

million anticipate to QX we $XXX range million. in the of $XXX ARR Specifically, be to

financial XXXX fiscal adoption. our plans reminder, customer a in not CDP do factor As

our XXXX. occur primarily to fiscal the existing our purchasing for year. impact of and through be the plans expansion CDP the offerings in achieved of The We balance expect revenue fiscal of will

I call Marty. return will to the now

Martin Cole

a CDP results. Center Public is And leadership is team. start into Cloud exceeded Stability, has the for Thanks, execution our that is focus raising QX. We entire for Jim. happy delivery quarter I'm year. report of outlook aloft. the team again our Data plans and executed pleased and the expectations, customers. to for consistency been to tangible with off of We're strong translating our work another straightforward fiscal CDP their

for to delivering the products want engineering I and action-oriented And our want to Public our our all Data again goals to quarter. customers' and team and our across our thank so field and our product quickly I continuing our believe to roadmap. Center after greatly customers business and globe delivering the to commitment its to thank This for for thank want objectives culture. CDP in I recognize business services. employees finally, our disciplined I our and simplifies want thank new our CDP partners meeting for of Cloud. embracing for plans against organization

Let's Q of portion and &A the pause the call. here begin

reminder, has and is let's us Chief joined questions. Arun first Officer available question for please. the a Product Murthy, Operator, have As

Question-and-Answer Session

Instructions] [Operator

Operator

question first Your comes Craig- the from Bennett from of Chad line Hallum.

ChadBennett

Thanks taking really questions. my clean and on Everything for Great. Great good. the job quarter. looks

exceeding in for customers. It like So I over interest or And Center enterprise at Marty, well out. do with questions quickly and and are year. believe CDP was now certainly least that Data you. they maybe with cloud least Center that's at CDP strata where But is quarter into then just of maybe at your Cloud going next actually The as bare a can few you sounds as of CDP Data very impact CDP about maybe think soon CDP, this how today. at bookings customer kind metal function what how

MartinCole

to some Arun start respect So sort have Chad, impact Jim and comments capabilities. I'm with with and and the respect to Arun of Jim probably to I'll bookings here. product features add going both

question. and for you comments thank your So

you're all will and be Hub, it of customers for we Data And is those on used Center Public starting the access as really Machine and The whether very the Public Cloud, throughout have capabilities to what that described. it be of bare under CDP We Cloud the getting the now and working both the at you described is look in the Warehouse at early we with Data in the crossover and think available beautiful and hybrid opportunity have call in as CDP thing to environment. here been those cases metal the product. who CDP to will we are umbrella And Learning market. look have to Data ultimate the both we're are pleased

in can explain in you we've terms to So tell here. respect are of which let described where it will me with past. Jim impacts I He we to the as is, turn expectations

Jim very our a will have design by little bit fiscal We terms little XXXX, maybe see our model. of in we revenue impact in year but fiscal XXXX, more in on you comment And the can current that.

JimFrankola

Center released that at Data the announced CDP our was on on is product The was software. strata. version specifically Very on-prem of Yes. November It XXnd.

through it's in just being now. frameworks. right It's going the So their market evaluated security customers by

will that versions. most be that CDP were anticipate will deals would Hortonworks I formerly So legacy quarter this deals see to that sell this be we targeted Data of But software quarter. the Center Cloudera or on-premise we

this the offering. built past I, we've are planned quarter for quarter's this in current on So bookings as discussed are our

and I of fiscal to think CDP comment. CDP bookings Cloud to additional, be the and Public will benefit year terms our have our primarily of Center next upside plans in Data standalone Arun

ArunMurthy

again for Once Jim. Thanks thanks the question.

Just standpoint want to is way a at we product. reiterate one it's this looked from product the

have offerings, and to We releasing have represents learning just Marty cleanly Private And to which is CDP, we'd data, next then market sort Datacenter as and on Kubernetes, represents Cabernets the attach about the year machine on which completely stateful we Cloud. portion our about layer on. of as so is containers SDX will on-prem customers. prepared Data all and offerings a data, the released in our said daily the and we CDP the CDP like launched on-prem portion Center. for of running on Meta based bring in Cloud CDP so in And and CDP Public

step, the So result Cloud containers. CDP Cloud -- finish and you this executing see the on and we'll next us doing on-prem Public you Data with Enterprise half starting strategy then with Cloud we year we've now as first Kubernetes if this will, have is done what taken a Private on

ChadBennett

without about, expect the but heading And year-end, follow-up could. can Great. assume speaking just the into And of current I just that that generally I quarter anomaly partner's you deal. seasonality visibility you of know of or if churn the around me And improved further I talk kind the you quarter. one quick renewals for maybe improvement Jim, Any I hinted fourth and seasonal in someone this seeing quarter in bookings Thanks. quarter the of bookings and year typically think there. increase churn. it's that would comfort comment IBM, of biggest the or also kind your level expect of

JimFrankola

Yes.

me are unpack that. elements. of There couple a Let different

On like the business past our we two churn started piece, significantly once pre moved or we're merger, to ability and the our of merger. parallel the plan understand what increased first-quarter and

of anticipation that in churn quarter, we're improvements achieve our towards improvements So that we the told you expect we tracking forecast. we that to had last and

we of respect QX. XX% to occur XX% With to seasonality, typically see bookings our in

Our that QX well. as this is looking year like

strong this had So the we've QX to into relative forecasting we're And that's you. to the quarters that built that given guidance year. we've a earlier

MartinCole

as me QX. partner them quarter because And, comment We in just had with they good made a reference very quarter, IBM. we talked a are Chad, And of you let last to very strong ours.

Their QX. is well We important a It do relationship we continue to them. good enjoy, calendar as QX. enjoy well. within quarter to And an them for with continue

doing with collaboration reference Hat there. and work. I'm occurring We've the OpenShift about work and particularly we're Red got the additional Arun excited to Kubernetes made together

with of And momentum IBM. so a lot

Operator

And from Morgan the your from line Sanjit comes next question Singh of Stanley.

MarkRende

like about think driver? XXXk the larger question. which talked longer guess growth term you and you on Cloud over I But Center. I Great. as I taking ARR Thanks Or Mark I bigger think my particularly Public a about for know guess for when just see CDP for enterprise Rende CDP customers. we that of cohort Sanjit do Singh. Data

MartinCole

to our point or the which the offering our bare-metal Data and we're move enterprise Yes. the being it data Cloud. of that also platforms. it's Cloud through Public as consistency we to governance, I'd the we is hybrid we they it say able the this believe flexibility have characterize is, workloads our move But the needs an of that them necessary. into to that's of what is will deliver meet Whether where across to Cloud the the offering, Public whether beauty security, able shared want Center at the experience. beauty gives Private different The offering the

them in the so of we $X our our largest among We where and the give ARR. operate desire So them north customers among to flexibility. they give large million opportunity are customers,

will that with I've and the all to own been in the few Private Cloud want more they customers. likely likely institutions, to be the framework want for delivered Data the out in Public they take flexibility similar the have Cloud Cloud. really their certainly field the that Private the on stay to ones, that them will they're there Public a describe time Among But on-prem financial over workloads the Vision. our flexibility That's use They we've Enterprise we describe last that's in into quarters what as spending largest as Cloud and really Cloud it.

MarkRende

in Great and one one. could then quick sneak if I maybe more

different selling Any like vastly existing it different be motion? like Cloudera selling the motion that is different, very the CDP. color products? would to the salesforce Or for sales Is you. the for motion adapting the from if it is Regarding Thank there helpful. older how

MartinCole

Yes.

a So, to similar targeting product very selling customers. We're a We're selling enterprise at point the this motion audience. market similar. is Mark,

to selling Cloud same cost and we Public sell Private version. a with relates Center product. we're particularly salesforce we're Data And ways we to looking have opportunity with way sell certainly what to our used other so it to the may than the at version. Cloud at respect that as to traditionally market And increase Overtime, the lower

Operator

of from from question Raimo next your Lenschow the line Barclays. And comes

RaimoLenschow

me. from congratulations Hey,

we're you discussion? of that remember do evolution about do optionality see the Center. in feedback you Cloud about the you want What wouldn't you is or in of start customers there, offering If the where CDP you Private Data couple kind terms that's the terms and now think to have that and have like of customer of of Cloud changing go on-premise, broader Because this talking kind to offering and a quarters ago, land? Public

the was That question. first

cetera. Like interest? us the is of The value-add what, you second could most services the et where in higher like what see any terms color you. the do like you Thank warehouses question are give data

ArunMurthy

Raimo, of the for this Arun. A question. Thanks couple things. is

customers to we're early seeing emerge. some patterns talk we As interesting

existing For some I scenario. and the have us capacity larger new maybe of saying, to this is we small The pattern of patter of customers, to want on-prem infrastructure move they I definitely look lot see. run But workloads in my I the of lift and I Burst do they not a and to have sort workloads of one have. and Public want slightly Cloud we shift Cloud that's workloads. And sort might the sort see net

workload, So to and workload, take it down. this where seasonal this once they want shut run

to the and differentiations the want of vendors then the Public Cloud themselves one that different sort of is So take advantage provide. they last just

be on Cloud different Public You certain to better able versus might ones. the workload one do

see we the back. take of they results and capabilities want advantage to available Public where specific in bring hardware one pattern that Cloud sort then So of

important workload. how optionality we're the a seeing that they for profiles, They bringing the as about back, so thing costs the lot cost are you understand key there's want it they arbitrage their is will, understanding The sort have them can emerging do. of of of a if such driver they

huge performance benchmark right? performance. comes at of a the have days, is focus stake us of big lose, now and win when sort real a to they And and And olden that's as payoff. has we'd it why actual being optimization. In optimizing for were sort cost we dollars or wars What that

motion understand of of of towards we're really want embrace fashion also is our native and key interest products. them in part our offering and of offerings they seeing sort containers driver also answer in in has of really data have bringing for of platforms. our gravitate the evaluating offering what warehouse very our what seeing sort Kubernetes barrels been and other really our they this through ML of are Also offerings notion you the sort is when sort particularly in customers a us. sort and all because of is huge for sort ML is They to The

Operator

comes of Murphy question from next Mark Your the line JPMorgan. from

MarkMurphy

discussions yet? finding that companies that data that might early make warehouse machine pulled in or being CDP product have adjustment now, too Marty CDP to is snowflake over the and gone or the previously it a Thank and like Yes. directly are of with and you're Redshift kind you. into Databricks like learning marketplace you to

MartinCole

The conversation in changed you but on-prem dramatically. with competitive has Previously consistency, you bifurcating into Public cetera. offering The competing to We've quick Public is of the governance were improved don't and on-prem. we go are enjoyed terms longer we're We workloads The et have the And security, well say, Cloud. informed like, looking CDP what a and wow, that answer experience now certainly got where Cloud. they're guys have you product to another answer the like like product. customers no guys dynamic find That's really we've We yes. okay, conversation. has for ease-of-use, the here. have

enables shared that can been actually we data that experienced as better an experience take And my SDX occur. referenced has that powerful. prepared into Now and move same Cloud easier to experience the very the remarks, and or Public in I

MarkMurphy

think will little be range sort or on the sequential would quarters that growth think Based I to Okay. it And a of Jim, suggest ranging it in row. it guidance and X% looks year-over-year. I follow-up, seem been between for the Would around XX% settle out will has to in three at like kind of it, as X.X% ARR a that similar it lower. X.X% a

there a really starts coming that as would or CDP of were hold just If to you a out. kind bigger there takes, broadly? expect Is where more be to you that point can you take sequential what trend see

JimFrankola

answer The overtime. is yes

guidance We the should be to market on-prem able grow the who to in you want talk is seasonally through The what's with get is we large growing low-single But rate going QX. teens. the depending out not think of that to to we We yet. give fiscal So see growing CDP cloud market CDP, overtime high prepared teens, in to digits with XXXX on sorry in year to adoption. The for we're high want XX%. to excess of market. the

And we have look the offerings, much So we be new product very to participate specifically our as over several higher think with we'll next quarters, at able product. a new rate. a we

pricing. have new We

a of put distribution that internal place initiatives. We have changes licensing and in the number we've and

those think factors of believe will those So for numbers growth a give excess that we in are us all of to platform overtime.

MarkMurphy

Okay.

growth, you're ARR would clarify, this about in ARR I that's to So it just yet We the to that yet if you growth. think guiding not say X%. be trough don't QX able know

JimFrankola

get again, through us let Once our QX.

Let us see the rate adoption. CDP of

see we guidance then some March. in of traction. how our Let's these give other start And initiatives you to will gain

MarkMurphy

the understand thing, that was wondering one large like majority deal. large not I with one but happened It adjusting the of across churn were what last for deal. could just has the sounds situation. it or guess fully re-explain it vast base, Yes, fair details if And enough. very improved did I you you the I a

JimFrankola

QX QX, very Yes. QX. improvement and reported. for then a churn rates In level transaction that absolute as at specifically in QX were merger-related. the we we an same levels churn roughly QX showed was normalize large general substantial over If that churn improving, But is had

major the So than getting we message disclosed. first better as is churn is half half second

QX, at churn the QX roughly with terms that that we basically As in that And that put dropped were that the performance of looked we QX. the pleased and meant QX things they in place one reported the numbers we our transaction same in were control. could as shoe was rate

MartinCole

where Just volume a to it just particular on to lost. prior a the had rather pricing. Mark, was we this happened Mark. we some customer based customer not customer that what Marty, one merger on is follow-up on the other referenced, it's declined point, But

Jim of churn the said rates. though first than as the second year So half fiscal half the is rate churns better

improvements. pleased the and terms very trajectory we're of in So

Operator

question Turits comes And the of Raymond your from James. Michael from line next

MichaelTurits

discussion quarter. been over and and of Guys, lakes the in congrats on vendors with the years data The last competing couple cloud has solid challenges a applications running.

to You but are or that there's are feel now because we the cloud cloud. better in better don't Do like you're against you okay, we have you're putting cloud solid the actually executing product And providers. in win the rates that's a products like a now new numbers. people path seeing the say, out up you clear that

MartinCole

Yes, Michael, it's Marty.

is question CDP, answer our functionality able conversations having of great it's to the the appreciate of demonstrate leading the has with having the being your availability improved sort question. And the greatly customers. So a roadmap because

the them. year that As We we challenge, of a when. couldn't talked in was them what we show couldn't details about products give the earlier will be available

delivering So we're now we and capability have products. that

So version. Center, customers we've Cloud. got been available Data Public who are using The it. Azure. CDP the and It's AWS on-premises shipped on CDP It's

that. weeks a visibility start a just ago having to that and now weeks of of They're made it couple available shipping We ago. couple

So that we're the down conversation say, have and here's changed our has organization force, sales where and field go empowered sit our has to going.

your journey. Here's

Let's about renewal. the now talk

Let's touch. around very talk a positive it's a They that This expansion. with products roadmap experience. about could customers is they could the real because real conversation see could

be rates win your improving? just CMR are So to against clear, say, actually

JimFrankola

to Arun, are you going take that?

ArunMurthy

Like proof have understand doing it's Yes. a performance the in numbers that we're the and from We we about customers burden The a cost said we sort governance us. standpoint on said eight very a and And talking real engaging very, had security Having don't that are product about from market really like show weeks. with we early. for and to yet. excited of focus particularly now that standpoint. what a optimization we're of we

color us the you and come quarters expect next give you to to So in back there. some more

MichaelTurits

about talk revenue with Is XXXX, can we not our think and you move Mark guidance you next translate the next year? could for asking follow-up I there ARR about Jim, you, see and lag I any ARR. between we into giving move ARR kind the growth. but how as know into I year, you're and if as was into revenue growth of relationship

JimFrankola

numbers high expect largely will but are puts right would puts think at and the will purchase growth in converge. next different level ARR roughly does and growth growth answer accounting. year be as question? Clearly, at your I a to I'm say There I the that Michael, ARR I the much numbers of takes, year because looking this revenue takes offset. and now, the revenue

Operator

of And next Ives from from Securities. the line Wedbush your comes Dan question

StreckerBacke

for Hi, this is Dan. on Strecker

the cycles field? Just one sales you in then Can quick on seeing Thanks. specifically are changing one deals? talk what And here. about you're guys how larger

JimFrankola

remained especially stable most six year. relating slight start we recent that have They're we it announcements Cloud. things I to greater would The our this clarity. in Sales eight to for relatively have typically; seven, head into see of transactions. as would given cycles expect months call for year, the improvement cycles sales a to next Public

Operator

of the Andrew comes question from Your Jack from Needham. next line

KhanhNgo

after what taking Gentlemen, hybrid how Within And this describe enterprise they build filling have percentage is you hybrid gotten tried base for the Khanh my it's in to cloud would has like for afternoon. Ngo your Thanks customers customer maturity these the and level features? customers question. unsuccessfully purchased of Jack of extension developing trying unsuccessfully CDP would themselves.

ArunMurthy

big model basis, how customers us, Great blocker tried governance of the to of consistent past. question. right. we It's many who notion this a a on percentage been having early like security know in comment but it's The for a very and certainly this make several for hard have had them

software and do other their land to one and we migration, glass had was The this you But it. help steps you themselves you problem would if migration of which have around couple of migrate what and workload if data lost set and when our big and pane of dealing really different for sort they either control CDP here data they a or manage cloud one because cost of workloads and products went of kind at like then was at put And data sets consistent where one say, end data. on-prem differently look, So lost sort of scenarios tools of the data in behave CDP have profiles to of or we with of started you a software customers this furthermore, of are and end. is to on. all other the said, formed track see so migrating part are include from strategy workloads to infrastructure as migrating understand what workload helping you're

work to cloud we they actually continue Public we the really also more this themselves to and why And accelerate. to with see well So to is because providers expect drive this us with on-ramp Cloud. the workloads CDP,

KhanhNgo

from of have and Great cloud-based trying and sure it kind the message mostly customers demand kind terms make driven of you customers some you to or organic driving there? to guess understand your Do in do by to envision they calling that I of demand CDP. acquire

ArunMurthy

Yes.

we're part fairly in data we amount So it's and do customers given of that workloads the of strategy, right? present our actually regular conversation of this that not the been have that in have been that we they and in the amount it's fairly actually key see we one-off. Public the have, sense can sense as a organic actually incumbent a overall part sort on-prem, do and of house as go where So as have Cloud in infrastructure organic the the to of and conversation having do this largest roadmap

Operator

And you have a from Citi. question from Tyler Radke

TylerRadke

the on we those related apologies could of this just Hey, and kind around M&A confidence in a side thinking the earnings as about also how synergies just on Maybe synergies as talk talk Maybe the and calls. you levers little dancing thanks as saw your been reach forward. bit revenue breakeven but should XXXX. about quarter. side synergies; those cash inflecting target be we flow you or you the Certainly other in going on and top

JimFrankola

Okay.

on start So him. the And the revenue want to side that. me let with anything end add at Arun if let

ahead to a of big grow less $XXX now independently standalone year. cost structure to Right were So $X than round well cost with we the in million about companies to They had tracking are numbers, this $XXX billion. The merger million. to respect costs we're planning of a over synergies. pre-merger

are had unless all million over the $XXX run to And complete. close off company with of spend. associated cost rate million planned the $XXX the, a Most we've to the synergies taken well out of each what so merger actions

longer get support combining systems just like benefit. items lead-time benefits of Some for starting to and the financial are now the organizations the

So all there the merger, with very pleased. us essentially are but are we're complete of still actions associated some savings and ahead the

In benefits terms now starting what are roadmap. in we're see synergies, those product of the revenue to the

Cloudera the maintained. come that have out a in was have couldn't company CDP was at terms of standalone we schedule if or Hortonworks or come So aggressively least not out standalone company

those and benefits very learning elements found and helped fastest-growing to the our we the of of of will us some So our changes that distribution. of made own then merger Also revenue side licensing be this Either us changes. our the which business. offering. CDP on with terms it one two the make year have associated products, finally, in of of hard would have machine And data-in-motion been the has those cross-selling have and we

Q&A of End

now today's session. concludes Q&A remarks. call the turn back will closing I the That to presenter for

Martin Cole

you. thanks us for everyone today. joining again Thank And

through move you. and all to we family for As our rest now good thank of Goodbye Cloudera season. wishes for sends of month, the holiday this our operator? happy healthy you a and

Operator

you does this conclude Thank call. gentlemen, and participating. conference today's Ladies for

disconnect. now may You

Kevin Cook	VP, Corporate Development, IR
Martin Cole	Chairman and Interim Chief Executive Officer
Jim Frankola	Chief Financial Officer
Arun Murthy	Chief Product Officer
Chad Bennett	Craig Hallum
Mark Rende	Morgan Stanley
Raimo Lenschow	Barclays
Mark Murphy	JPMorgan
Michael Turits	Raymond James
Strecker Backe	Wedbush Securities Inc
Khanh Ngo	Needham & Company
Tyler Radke	Citigroup

Cloudera (CLDR) 5 Dec 192020 Q3 Earnings call transcript