GTLB - Earnings call transcript Q4 2022

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Operator

[Call starts abruptly] [Operator Instructions] This meeting will be recorded. GitLab's Fourth Quarter and Fiscal 2022 Year-End Financial Results Presentation. GitLab's Co-Founder and CEO, Sid Sijbrandij; GitLab's Chief Financial Officer, Brian Robbins, will provide commentary on the quarter and fiscal year. Please note, we will be opening up the call for panelists' questions. [Operator Instructions] Before we begin, I'll cover the Safe Harbor statement.

we federal forward-looking securities call, meaning within conference the of laws. this may statements make the During These statements actual involve and materially unknown assumptions those that are and from that subject uncertainties could or cause discussed results differ risks to anticipated. to known

discussion today complete with associated filings, recent our and business, our risks in to our quarterly these to most Form encourage SEC you of refer statements XX-Q. report earnings our a For forward-looking we release on distributed including

information we currently release to or the reflect upon or to undertake Our us. reliance statements you unanticipated forward-looking based of update any occurrence statements duty caution available not forward-looking events any circumstances on or We are or or any to to events. obligation forward-looking do to to undue revisions future place report statements and not any

financial website. most this financial will release GAAP Officer, and not to discussed be be SEC. our GitLab's release. as of by our with during referred accounting press today's reconciliation in over call A are of measures section Investor for now our posted investors replay addition, turn the reconciliations, available contained substitute Sid comparable Co-Founder call on non-GAAP that is statements A are believe principles management our the earnings be to differ call, supplemental information, our supplemental the with greater Executive website. comparing These detail intended results. Relations U.S. and prepared results of in at certain the will assist Sijbrandij. performance schedules additional in to Exchange Chief comparable I Commission in also the in Securities accordance and the of measures to accepted financial financial these may included submitted measures discussed These In period-to-period as generally the together from measures. earnings performance We measures measures in our a these GAAP non-GAAP that evaluating to and operations non-GAAP non-GAAP financial measures to

Sid Sijbrandij

violence for earnings fourth us begin joining and I'd Ukraine, invasion unjustified before against people a for remain year-end all family like and terrible our GitLab the our it’s members, unprovoked our you discussing including and of sovereign to those We've in the nation region. the fiscal we the horrific contact and by all quarter heartbroken military and friends. with saying and been with And the saddened region, impact XXXX deeply team by constant Thank of acts of Russian I'm concerned in the I'm seeing. quarterly to team what results, presentation. in members

Ukraine, Before had XX of invasion, in members been still we with directly the there. some those impacted. are team We've military whom working

We will and economic provide support. assistance ongoing

excited our had to XXXX revenue today exceeded to we expectations are quarter the quarter XX% that of turning for results. This and own million. great Now of a fiscal year-over-year. revenue the year with represents growth $XX.X fourth a We share of

customers which across additions S-X driven SMB. and existing by believe all the company on broad-based, was more Our we we rate net investment exceeded driven we in sizes: XXX% mid-market strong dollar-based filing users acceleration the return it's in provide. and reported demonstrates enterprise, customer significant primarily by This our growth at retention

market would We to enables of the important platform. DIY DevOps today. to represent composed delivery is organizations will In and that Market demonstrate Ultimate by which Guide addition, we success states our the three advantage. customers signing platforms of remains cover continue switched results upgrading XXXX, their will shift distinct tools to is value to believe to these to growth in This software from market our topics for accelerate competitive a platform of new moving a supports time in that organizations are XXX% tier. applications, we a There most approach. XX% from main view. have providing them XX% both achieve further adoption Gartner XXXX. and This rate different fastest-growing DevOps that stream with The It a

will differentiation. core the aspects First, of explain I product our

Second, how proposition problems. unique how this translating third, Officer, into in profile. into strong our I translates will Robbins, Brian discuss solving the by will critical differentiation summarize marketplace success Financial customer is financial a our And Chief value

the DevOps of problem the do-it-yourself and operations the our that building harder teams responsible DevOps, integrate Their source from juggling cycle, there for into product months allows life more DevOps business-critical call scripts plus operations. it DIY hours. IT something mission. of serve the no chain practices development, are to and approach to is And we applications. shorten is homegrown which can DevOps. are, the teams collaborate But believe that we set solutions platform differentiation our development code development, evolved work software companies First, typically has many to deployment and all. to for tools, integration together is point them tool longer to security a their a these and to different related there's Most engineering

the solution our It innovation. unified user efficiency software only duct efficiently workflow companies to digital and complex one software and replaces switch and which not platform, collaboratively platform model. DIY duct cloud this advantage the enables believe DevOps We applications with to approach tape. manage This single of extremely their the innovate moves to risk. to users product. enables our full application We're to our tool secure multi-cloud This, select need faster teams and one is us any disjointed overreliance provider. DevOps build, important out drive effective benefits in DevOps. plan, to competitive we the environment. point eliminates of chain to these single to customers to able stages to but faster a best disjointed we people provides the maturing multi-cloud at empower avoid and because get allowing That's our with features business customers reduce hundreds the our DevOps you GitLab rapid customers. organizational and this enabled get their for be a from innovation. allows provider believe lock-in will outcomes organization to any constrains companies innovate, deliver it security interface cloud data tape because problem and Every your The single organizations for of deploy vendor and a different super tools, also to chain. the teams GitLab to a come deliver tool quarter, and and the GitLab more call platform-first the our the our the ability customers continue mature from allows on You and contributions our embrace in faster, positive customers. of also us a GitLab, software using digital customers be cut strategy. improvements improve between At and secure our help of entire helps for We application hybrid compliance across will

more call where which contributions a this more We community partner the finish virtuous dual more over We to features to the more that lead are contributions. back contributions our vested innovation the cycle wider also able of increasing with feel to in interest users their increasing the help them get flywheel line, they lead to product. and strategy while creates pace effectively a leading

fast our Iteration delivered piece our of smallest the reason of possible, thing iteration. Another is of work be so scope the for innovation it the fast. reducing value means with next valuable can

allows day To the fourth also every innovation and every January. XXnd This examples we to this of as predictable in from row on areas. we month XXX following rapidly. for benefit is us of in shipped some Our new delivered the innovation, customers it a our enhancements allows provide very to feedback months in as the quarter, of get innovation month

approval a controls empower key software chain everyone teams for as least security be to we is With security mind, change secure. be enabling focus security to their continues better allows this request merge every and people. by This enterprises First, organizations in controls helps by controls and providing that risk. supply fine-grained at this manage critical more two approval software to reviewed be improved

enterprise this Kubernetes continuing and key expand some cloud-native including scanning this, are to improving transformations we agent code support Second, digital quite we a time. for the continue infrastructure capabilities, To and cloud-native see security GitLab adoption to our drive for initiative a user as as for experience capabilities.

costs. scalability continue registry both to made to while GitLab improving also the with Third, start-up or application are we recognize business for thousands enterprise small of a of our to team reducing better critical tens our performance enable that platform. is of in we performance users. storage they container GitLab customers with whether our customers, recently a invest and improvements Thus, We DevOps new

functionality, Additionally, improved geo support management, core worldwide customer we Fourth, better our performance. made investments sure journey. that work These including source seamlessly capabilities and CI/CD our we typical code with security features. our

date, to package customers our then code use with release. tend to source secure in and start to CI, expand As

We this GitLab. also with I'd examples like expand customers two do continue in expansion. to to markets invest can to what adjacent of share

Opstrace, open reduce will increase monitoring to capabilities this is offer endeavor acquisition, and resolution. and example time first The robust we observability rates, observability a our developer enable acquisition incident to that lower pre-revenue organizations of to source mean With solution. productivity

data example this of is include the science. our platform of second to expansion The DevOps

of and AI engineers been well they We our when on today. notebook has are meeting user example the improving This as data this GitLab ML to of ML where and Jupyter rendering file structure teams An experience changes. as challenging. reviews workflows. are are easier the But improvement scientists makes review notebooks substance data key to code makes it Jupiter the and engineer bits. AI focus

this To in software that is a helps faster move remain problems. platform I effectively. addressing Every and to scaling turn, them our regarding innovating retaining believe cloud which, building being to companies to them We customers differentiation serving only their customer DevOps companies market market, will must the XX% translating are solving this company our study, XX% GitLab & are discuss Enterprise small more but the of applications. enables become believes are and modernize asked more how DevOps a $XX is mature. marketplace billion mature stated the a critical recent business' DevOps success by a applications to view companies Bain reality, DevOps competitive. easily according into practices priority cloud-native Company early-stage a faster, their their and businesses company nature support opportunity. in of and practices to is their have Next, vision into translate

Our tens large small DevOps of thousands is business users single geographies platform of range number organizations to spread user of customers, from and GitLab's a verticals. of to for across outcomes Fortune number of positive a a base XXX companies. delivers wide users, very from across wide

expanded growth have customers them successes, usage. a and the of value over of added Ultimate that XXX highlights. into their quarterly new Given evidenced are This GitLab. the achieving compliance adoption six I'm by translated leveraging in years ago. want business quarter, in is the as into cohorts of from over also platform. fourth increase strong our We their customers customers. DevOps a we security continued by built to share saw net base Many number proud continued This capabilities proposition

Army, expansions Some Telekom U.S. of include our Travis new and Perkins. logos are major Deutsche

expansions. continue our perspective, opportunities examples also From at returns forward. of with give in moving which happening pipeline increasing channel customer level qualitative We see Please three pleased to are number let you increasing is we with of me the of strategic C the an resulting conversations a increasing partners.

First, overall Travis cloud building by Travis partner by it. The to Perkins and increased cost their down allowed Perkins consolidating building team the migration chain. focus their accelerated of services managing to instead has on to Doing distributor tool at it GitLab their customer-facing and leading team materials software U.K.'s velocity, construction digital their so XX% the members is the using cut capabilities Premium industry. largest their of to and new

single number GitLab teams This doubled upgraded and from of operations a allow security security platform. they development This of to and on will on to than usage quarter, to collaborate Ultimate system. users more DevOps licenses their Premium expand the and the

is German they competitor automotive X,XXX GitLab library. CI have from it’s experience. customer migrate from creating multinational GitLab now where Second, their of solution XX,XXX complex consistent to a business to Premium seats faced to of unlocked monolithic quarter. customer challenges The pipelines upgrading efficiency These GitLab a chain their modular their by from Starter pipeline on and an this increased their changes corporation to need more as supply scalability world-leading use workloads management improved, developer CI while expanded by CI internal platform. DevOps this consolidating This a

expanded company culture U.S. Ultimate, their the company work together. improve tests security in wanted now the financing the rate mortgage prior expects the address to teams to development security security earlier will the by and anticipates reduce this able With XX% vulnerabilities, immediately frequency quarter. days investment for of in DevOps life of their weeks cycle. XX% in to provider instead in perform leading developers waiting a The approach. failure deployment is Third, that increase well. or development way change deployment's company Ultimate able by The to GitLab The as company be to their GitLab and

look to will we DevOps early market. growing we turn Officer. momentum Robbins, Brian and platform strong feel call continued we customers we our forward, large As are are Chief GitLab's seeing and in I still the Financial adopting over from now a

Brian Robbins

to again us you Thank everyone joining you, and today. Sid thank

Sid. to take I'd what's to in happening I echo begin, like acknowledge Ukraine. like I to moment Before a would

What rate and growth, We operating by strong evaluate DevOps momentum. key what metric terrible a our will our strong and use serves conclude recap net moment revenue financial as a members guidance. want XX% ratable, our and years demand We cohorts believe start and expand is This financial strong who of this, and to of performance this it how financial GitLab also and illustrate gross we're health is from of business impacted cohorts for into cohorts. I'll fourth are our we are Because size benchmark six growing. results by to long our as testament growth supporting period At and is are over customers makes Most value with devastated translates our we adding our constantly still predictable a sustain both key to situation. platform paid a has transparent revenue unique the we time teams. tier. to customers. the are GitLab of spend then quickly I summarizing highlight today. are that across how they a quarter ago I as our To expanding our more expansion increase team our their of with strong they to for in typically with platform. the to then their with organizations just year us as spend Xx expands a our a business. continue our using has GitLab, profile, platform teams first our to small stages increase all their underlying From or revenue upgrade teams how spend adopted over transpired multiple two Customers metrics there, profile, our platform margin one served our to approximately the to dollar-based our how across higher in

at customers. we fourth which effective our we the time our net DevOps is disclosure at of workflows The We in our difficult which provided and quarter dollar-based DevOps from are XXX% that deploy than with exceeding higher becomes result platform replace. S-X rate central sticky the the also IPO. our retention making ended a is a our retaining originate customers their it all it from, platform, to When

tighter Moving fourth on as metric forward, we believe threshold disclosing anticipate for fine-tune each investors quarter an will their models. this to we a annual our allow this basis

strategic Next as quarter, will highly a revert as reporting threshold. metric a back customers. is threshold we our GitLab for to XXX% platform using a this

paid two subscription tiers free call Our and platform Premium version with offered a we and Ultimate. is which

to our compared per tier, the and user Ultimate tier annual different organization representing with increase. of XX% understand. XXXX this recurring costs the in plan with within is XXX%. of XX% transparent keep fourth our helps time, Every becomes the and our hosting XX%. associated paid in an Over business quarter non-GAAP our tiers for offering will fastest-growing model compress Our fourth FY In which now of growing revenue 'XX, as FY priced portion a quarter expect are recurring our The our of tier. is per at and revenue steady same gross features user on excess held annual to SaaS of we business larger margin easy

On investing side, are expense we growth. the to in committed operating

believe this continuing significant investments long-term ultimately are the do We that profitability. revenue will sustain responsibly. the our several us for years we to our improve will making we growth in while to drive to margins enable rates business next However,

Finally, remote expenditures a capital because minimal this have GitLab we which that fully a operates workforce, as cash-efficient business. ensures produces

me let $XX.X Now turn prior organically million year. from to quarter. of Revenue increased the XX% the

to XX%. rate in As year. This per had the customers greater ARR in $X,XXX least approximately of of represents in of the customer end, over growth with X,XXX in of ARR quarter XX% prior X,XXX Currently, represent our than $X,XXX X,XXX approximately and compared customers a quarter prior year-over-year we over over customers customers at ARR.

of in the larger and performance than customers, spending as measure also We $XXX,XXX who define more with us. those ARR our growth we

this customers from XX%. with FY XX at growth we At customers of quarter least XXX of of of had the end XX at XXX over the $X approximately customers growth a end This year-over-year and of and rate to compared least customers over year quarter, rate a represents prior represents XXX at year-over-year compared which year, customers million For of the had we XXXX, prior respectively. XX%. the ARR to fiscal with ARR $XXX,XXX, up

for be impacted do billings As prepaid notably factors, history most believe of comparisons number multiyear you to be good given not a period of know, our our that we deals. by large prior indicator many calculated of business a can

compares the which of fourth billings $XXX grew the as gross immediately Total revenue and to example margins Non-GAAP an saw the we strong for XX% were stronger quarter in growth This XX% even preceding acceleration. to XX% in year. RPO last quarter quarter quarter million. year-over-year and this XX% provided excellent growth acceleration

compared moderate growth revenue SaaS in year-over-year or rapid million loss a we're metric negative in XX% business of of the for last and As and largely and leverage on $XX.X the revenue the set to performed Non-GAAP is revenue last operating the JV was loss quarter, million reduction top during negative million well of includes and operating used same fiscal cash business our QX to to related this saw million improved line strength. rate million the $X.X $X.X QX a XX% Operating was quarter the $X quarter We bottom majority-owned we $XX.X of up in continued subsidiary. year. year. by compared year due of this in move expenses quarter believe We offering. our forward, of the estimating outperformance. driven both our to across or

Now let's turn to guidance.

first For of million, representing to quarter XX% $XX of to of revenue million a expect we total growth rate FY XXXX, $XX XX% year-over-year.

loss non-GAAP $X.XX share outstanding. we to million per non-GAAP $XX.X a net We XXX loss $XX.X $X.XX, to expect a assuming weighted operating expect of average of million million. shares And

of revenue For representing $XXX.X the XXXX, of full total growth we XX% XX% to year million to rate $XXX.X FY year-over-year. million, expect a

non-GAAP million. part expect of non-GAAP new marketing average anticipated recognize customer that XXXX public which, that costs loss and million are be note due we exercise approximately expenses We shares a combined, it's as in FY the net to of resumption and weighted expect our $XXX $XXX to travel We operating million. share $X.XX, approach operating well as per will $X.XX $XX outstanding. anticipate a and disciplined a investments company events in rise in-person And million XXX assuming to loss to of we to important to

in apparent. $XX are Of in $XX despite million $X.X $XX also up and we we of forecasting majority-owned expenses XXXX. believe expect business already Nonetheless, of this to joint approximately unit our we these QX. are becoming improved million million, in our related from FY approximately expenses, expenses addition, In million subsidiary, added economics venture

points FY at of implies basis our the margin XXXX year-over-year annual operating Our almost non-GAAP improvement midpoint of guidance ranges. guidance XXX

feature now that To a chat the for yield unit the continued in question, that, longer to on question first ask to and targeted use questions. initiatives the please and ready growth Kristy, Over a we term, question. improvement the we're move we Q&A. business economics. will directly post focus will believe With your IR scaling further

Operator

JPMorgan. first Our from question at comes Sterling

Sterling Auty

guys. Hi, thanks. Yes,

upsell So give net of CI at us dollar coming more code that modules? greater maybe of you is versus kicked in a get actually to looking off, from can kind much of us and -- users for more than XXX% of that retention, sense products how source

Sid Sijbrandij

Yes, for Auty, thanks that question.

understand pricing stage. per what's that about don't price think is our I to really important we

So what most that exactly by know it. upsell reason driving being of we especially security capabilities. buy the is is the Ultimate don't to do a security is know our We capabilities, driven lot And the advanced Ultimate. common

lot -- Ultimate And that that's driving right of great, now. So revenue year-over-year. over XXX% we is a growth know of It's -- XX% doing our

are growth Create and Apart and secure we in and used so So important packaging they super important. verify from verify heavily; is are too. release. see create, secure,

is So JFrog at your packaging, customers. and more for Does that more example, address question? replacing Artifactory

Sterling Auty

you. Thank does. it. I It appreciate

Operator

next question. from Karl the UBS, you have

Karl Keirstead

of Okay, this for I pose for to that to evidence this that just Is 'XX. lot number and you by the guidance the growth Maybe what you maybe sort on and that look the number us on are to look at think indicator confidence impressed I'll people elaborate extent most of another encourage print give the a as you it to seeing you'd great. And Can listening number? be fiscal would revenue we there is we're are, momentum? think high-end of RPO? good that XX% Brian. leading Brian, what to I can at? a there metric is team in Or

Brian Robbins

think Appreciate driving less our competitors Karl. Us and I is just question. of than the largest business that we're and still really thanks, Yes, X% customers. market have it's market the The our the for early. outcomes still overall

company a become faster to and them and helping company do software And better, so secure. every more it we're today has

had XX%. Cohorts six XXX%. the us the today greater and for we about it. talked I that think is was years still XX% billings than that was so really expanding the are ago quarter RPO of dollar And and sum calculated net with of retention we've

that had put great have. we and guidance out a we the So we quarter

Karl Keirstead

Brian. appreciated, Much Okay.

Operator

Kash Goldman the have you next Sachs, question. from

Kash Rangan

all is [ph]. very hope thank the you much. to year. Hi, on a spectacular finish okay Congratulations I

the So SaaS that that talk advantage as you about curious, role a quantify after your securing of your in you one will how multi-cloud a how Can neutrality great. talked largest customers? have at also, And And business, you a I some could might to percentage had for was play about that beachhead if GitLab be Brian that. of much has. have

Sid Sijbrandij

Yes, thanks for that.

they customers to find of of side important many and clouds. don't productivity, that my So want They our push from more which are on it system cloud great measure irrespective to is they and using. to And saying, of able that reason really partnered they We're already the we're are cloud dependency." What faster that cloud. GitLab. with customers can that also -- second the security, outcomes. with them use drive going neutral move Azure. But really of is Customers integrators a are "Hey, people to we are using a increase AWS first us multiple I I'm hearing certain dependent we're GCP, not party. the is to the then reason

those of together. using those of advantages irrespective people That's coming or both. all exist SaaS are are self-managed; with So whether

Kash Rangan

year. sharply you, the one for Billings I towards longer-term rebounded to contracts from been company moving one QX has QX. Brian. and deemphasizing know very issuing And that

looked which talk you rate how the quite strong surprising? it can again, So was the as shift particularly one billings year as was growth about to considering

Brian Robbins

-- We last because the we not plan. Kash. nature. during going compensation why Analyst it. during reason told focus people sales appreciate Yes. And in the our did billings to the change be Thanks, Day we a in it's lumpy call, is on I and

a deemphasized year, our so change did and billings. we multiyear plan compensation And in we last

it the was of and year billings that. And half is two total XX% of years about last ago, so about

in had larger deals came This well so a single-year as the we why that were across as quarter, sort deals at XX%. multiyear really that's board our and of quarter strong on RPO

Kash Rangan

Thanks so much.

Operator

from Koji of verbalize please question. your Bank America,

Koji Ikeda

pre-revenue source on category questions. Question Yes. a definitely sentiment, observability, thanks Hey here. the now. Opstrace, for guys, topical application great open echo the taking I in right category quarter the of my

for how you maybe could why Sid accelerate maybe process pull does mean the this for the could through this or And process to of acquiring So I walk guess, or Brian, observability Opstrace? platform? What us Dev GitLab? the forward

Sid Sijbrandij

for asking. Yes. Thanks

the let observability close So kind loop. of you

You it plan make roll out and then does. to something, you how you it make you it, see

So and got important, we're DevOps how product it's really because we wanted to Opstrace we so But early. there really of it's already built. team love platform that we element fast and and a important accelerate the a the

So business outcomes. and that our we help acquired loop better them achieve inside to GitLab that that we closing will customers think rebuild

cycle iterative you reduce do you you we'll If get really that feedback faster, outcomes. your time important and it get an better note to it's And in fashion.

with start over beginning, our time. with contributing nonconsumption. and customers expand functionality simple and will from the to much product but solution our we'll compete in the set not work existing so So users and vendors with People haven't up a yet monitoring

Koji Ikeda

could one dig Sid, with if follow-on in just I there.

you with have? this that competition observability going You or the a on you white anticipate becomes might a seeing think you're product did as after. you, do mention there, competitive that this front lot thinking more you're space of space for the you green of more who product But

Sid Sijbrandij

same as for competing DIY the in It's it We're products. Yes. the solutions by integrated customer is all DevOps. the with other that point get

like and the we with product. single But one So monitoring customers do we're make of come mind. competing lot having interface, them vendors to effort easier to any giving by one that regular of a

because but a it's of have platform, of we a that the that more part value not better it's product So out it. customer gets just

Koji Ikeda

Got it. Thanks, guys. Thanks for taking my questions.

Operator

Michael from KeyBanc, have question. you next the

Michael Turits

on Congrats guys. quarter. Thanks, the

like security theme, side. the that ask to very a with keep to maybe similar but I'd So on question

things specific about come where versus do understand think advantages that on static will providing cetera. and application one you you expanding platform think and -- you some commercial that the exclusively or, But you disadvantages building your et application like that will, where technical security? UI, do specifically in when if testing, companies are focused So into and secure, think security advantages I around

Sid Sijbrandij

improve point solutions. your immediately are everything. The it best your to security we it it’s it you're We've better also allows able set to needs solutions, customers happens comply comply over framework We security less, integrated just last On that writing own security the against with for when can the few It's Yes. that the our in the testing our this every allows writing point you can hold invested of These it do do nicely top being you're with you believe GitLab GitLab, also In implications, to project, heavily that something right? done in compliance. not solution with. years. for it but shift compete as to code every is you code. environment is

So comes, at the when you have an auditor ready. that

that's the solution, having of platform. upside of above part point the So DevOps kind it a

Michael Turits

And your for wonder earlier you Brian, I it's in CI mean, think whether -- not the maybe, -- I noncore perhaps able terms of system, then investment stack these on, us priority to rank were I CD. not not and of ancillary the the of and SCM,

rank left in or priority, in ops further in planning? of an would any? has further to whether prevention further to in investment changed you rank priorities? the to how the or So would sort right you that stack it's those stack investment Or How right the

Sid Sijbrandij

secure. in managing investing in much very and create, features of in in sort verify compliance We're Yes.

you are in do of growth in by areas, it's then we'll them early thoughtful very you can all If we'll for the other with very two, we're investing and And driving look of our be see lot the push as there. revenue, there seeing the secure. primarily which release -- it's we'll going more push them growth. Secure and is next by early to we spending but but of package -- That's Ultimate. driven at a also adoption wholly kind are

Michael Turits

Thanks, Brian. Thanks, Sid.

Operator

Next Truist. with from question comes Joel

Joel Fishbein

on congrats maybe I That'd and Brian, afternoon be been good sales quarter. how had sales question how been has growing Hey, a your really helpful. capacity a know around great and efficiency you've us could just running. go-to-market. let you

Brian Robbins

our where We're change success Thanks, in really in Yes. ARR greater makes XX% most There's had investing capacity. of there. of been up we're Enterprise Joel. a investing lot no than enterprise. total we've and sales in

SMB. in mid-market, in is area second little very The then

we're we launched partnered so And some extremely the strong. and different talked just when the albeit We're promising really number an how rates quarter the rates, so channel things standpoint, doing happy with still the a with road, that sales we're of attainment pipeline those, a on Win early, go-to-market and happy we've win new hyperscalers are things. doing productivity so force the really results program. about remain we're And and And coverage. from with looking. are and motions

Joel Fishbein

Thanks.

Brian Robbins

Yes. Thanks, Joel.

Operator

from ask question. please your Piper, Rob

Rob Owens

last quarter quarter. just taking that bit understanding Thank the as was true-ups here Great. my And out a forward? I know Curious comparisons guys any questions. for played a but headwind and around this we're it dynamic little of you difficult looking

Brian Robbins

this Thanks we about Rob. billings bringing for have it talk Glad true-ups or Thanks, quarter. don't to up.

They And were so about are than were decline. they so were ago. a quarter $XXX,XXX true-ups less, year-over-year a year less this they still

actually more the purchased. Just And come to remind we everybody, in actually a that true-up licenses they our happened for it's something than when is use when customers past. up renewal,

be true-ups a so And last where will cloud compare of eventually over process in think tough was quarter there putting like we're in don't the a but licensing time away there go system in I that third will of year.

Rob Owens

And X. think opportunity? on you I little federal Type ago, a Great. the got a touch year bit it SOC X and you can second, about was then Type

terms sales go. Just maybe federal could and you where where on of expand that are in

Brian Robbins

Yes.

take to happy I'm So that.

really invested progress our just So we have ago they've quarters over made. the in about with that two, recently happy team federal three and

pipeline, and a PubSec working and quarter doing at fed is well where to third continuing big is As and quarter sales rent. build we're on you with know, for they're team our happy so

Operator

with question. Cowen, please ask Derrick your

Derrick Wood

I quarter. see particularly, ask hyperscaler strong about tight your you're Good I wanted AWS on to GCP with ramping. a relationships, Congrats Great. know I to guys. and think you is

you can and So thinking a ahead? how sense just the about you're the us past year opportunities in those throughout year give trended this what for

Sid Sijbrandij

us for in building a the a This we very We're see they're risk really that and bring want a bullish at platform the DevOps cloud because the tooling was a they it's to -- They the relationship in -- deal, nonneutral party future. when faster the sense. the and with great because for hyperscalers makes might go year Yes. for moves into believe it party, we to a stronger if it the that customer all DevOps see future. they neutral

sides. investing we in sense the of a So grow and we are And from to it both expect makes lot there it future.

Derrick Wood

I follow-up. the think up a all take you I driving really that sense. hearing Makes interesting, mean the What get quick level, that? engagement to could ingredients engaging is what more that are pretty If at that executive level? are an guys way you the it's do C

Sid Sijbrandij

because company you driving the of radar breached, couple -- it on priority. because make C-level also on If people needs there's Every getting so software in it's that's harder needs stuck the sometimes important, a more become it's in of it's company and realize on the if not working involvement is things. that. company, right? the a something, the to needed. Security DevOps are to it's executives. so you're And newspaper, DIY companies It's higher There's you get

bigger, have as grow an to trying for beyond. time we're been long it. that sometimes We've a but audience easier C get to getting with to successful So And level. it's go do we the at more we

Derrick Wood

That’s great. Thanks.

Operator

then William the so. may from have verbalize, from question like to move question. do would we'll at you right. team from his RBC. next our you Well, someone Blair, All on if Matt to final Or Jason

Matt Hedberg

today? the guys that can GSIs I in curious, might where several thanks including for what you is sort of questions And Hi guys, you to of bunch been I'm on us market, a -- remind curious, partner-influenced years? taking have next And hyperscalers. business and ways question. go several There's your of several guess, my markets I'm go-to-market. percentage

Brian Robbins

X.X give out a Yes. don't of one doing. X.X We -- We've we been sources direct go-to-market Great how the sort primarily is question, and of Matt. motion each about our actually economics. same years quicker ago the motions little different to the we've us ago, all market with implemented helping and go-to-market relatively is so reach and get years that expand actually don't until so a up go-to-market just over

Sid every business software we're earlier, And said really that for so driving company. to become high. company customers has The our is a as outcomes

through REITs through so GSIs, that hyperscalers, trying forth. channel through the to so our the doing we're get, we're and And program that

Matt Hedberg

But not for makes maybe you're obviously precise just then part this that one the last quarter that And that one. was in it, disclosure. going first and numbers I stellar giving basis sense. know Got be on to to thank you directional how NRR embedded of a quarterly XXX%? the your in guidance? computation that sort of Or guide, sort you year. the something about guess, the guide, thought what's you in I any sort of on view closer just in of Brian, before revenue got like

Brian Robbins

Yes.

up to give in So had it was than specifically thought to it you reported to we disclosure sort higher haven't was an to help rate. the that happy disclosure in guided the important model where and a was -- dollar S-X. tighten it's at annual that we We to as say retention what your second net XXX%, we see that of

so we've is And are expanding. all ago years landed the say I can cohorts still six that

quarter, through our second it or relatively and security Our seeing logo about and the contraction in continuing to we are talked up-tiering. with so so customers when management a so back we're as portfolio expansions And Ultimate is such high extremely and our was either seats benefits forth retention, and see of low. lot feature

specific And and a can that's I tell trending. so number the I you can't elements how but been give

Matt Hedberg

of you. Thank Congrats on end a the year. strong

Brian Robbins

appreciate Really Matt. it. Thanks,

Operator

closing back over to for I'll that, things with remarks. And turn Sid

Sid Sijbrandij

like I'd our objectives. for our for to the achieve community you to partners, their Thank trusting help time your customers contributions. like all GitLab them business thank their and team GitLab wider members, thank for to today. I'd

our you. continued You all Thank had a part big success. in

GitLab (GTLB) 15 Mar 222022 Q4 Earnings call transcript