GTLB - Earnings call transcript Q1 2025

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings, and welcome to the GitLab First Quarter Fiscal Year 2025 Earnings Conference Call. [Operator Instructions].

As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Kelsey Turcotte, Vice President of Investor Relations. may you Kelsey, you, begin. Thank

Kelsey Turcotte

GitLab's joining Thank the Quarter and quarter for Brian and First and guidance fiscal today Year you CEO, will XXXX year. on Sijbrandij; Co-Founder for Fiscal GitLab's Financial GitLab's Call. Officer, the us Results commentary Financial Chief for Sytse Robins, Conference

presentation of earnings begin, we direct safe forward-looking our and discussion other and on to issued within cautionary the the of the statements those results X Litigation you available which forward-looking release Page assumptions of I are statements our could that statement. include Relations under from Before harbor cause our cover the and Act. meaning of website. a The today, Securities presentation factors earlier the our to Private uncertainties, statement any release section I'll certain to would in regarding Reform in risks, both like Investor differ earnings expressed

content and is of As today's be the presentation governed this call customary, language. by will

be Please release certain for non-GAAP the today's GAAP measures. measures information financial In addition, items directly non-GAAP These our to measures periods we financial exclude materials the financial non-GAAP comparable discussing measure. or the referenced. of management the call, and believes most certain comparability that and nonrecurring impact these presentation to refer earnings unusual during additional will regarding reconciliations

Executive Officer, Sid? I will Sijbrandij. Chief now turn to Sid and the call Co-Founder over GitLab's

Sytse Sijbrandij

also best-in-class top not Thank had of The our retention year-over-year margin derive expansion. XXX%. comes from net in line customers with growth our you strong significant only for and us dollar-based growth XX% joining today. We rate through revenue quarter a in value but first GitLab

expanding the is software our in total compliance We AI our personas. cases we platform software addressable quickly continue also with throughout way is transforming security continue life delivered. for market use cycle to new and development AI and differentiate the

and we Both and because AMB, customers, leverage platform, uniquely and financial AI cycle. security beyond company, like the productivity we our without NASA, to our customers in value well extends have and believe With by enable improves the the the platform Carrefour, unmatched operations. the our new coding and existing development development life sacrificing end-to-end understand Artemis, the improved that planning, of quality across Indeed, It GitLab, speed. software are also security for and enables end-to-end FBI We services customers a market. benefits approach broadest delivered AI

this decreased for outages of productivity and leveraging in also A GitLab delivered thousands offering, GitLab, pipeline great a and year. every deploying is Duo GitLab in Duo already example AI that our since by in financial has XX% this increases of are that company translated has They services leading of savings Pro dollars Pro hundreds customer.

customers adoption We're excited who the are teams. bringing seeing Duo benefits GitLab about their it's by to

a in faster example, provider GitLab for communications more help the and global leading securely. purchased For go teams QX to engineering industry duo

conversational This productivity. released easy-to-use QX, capabilities transforms and without code AI optimizes AI suggested status, software duo understand Chat customers quickly I'm all about into with boosts of explanations interface chat texts, because language Chat We availability. add to by a GitLab natural contact chat to GitLab single a configuration, switching. new and generate helps through general we is help workflows excited receive and In DevSecOps integrating continue it It seamlessly planning for development interface. Duo. Duo. get GitLab project

risks enable manage reduce that organizations controls at adoption. of security project and privacy to new sensitive introduced group data the the helps subgroup compliance levels. also We This and AI

faster Duo developer-focused together. Pro with help Dua Enterprise Duo to enterprise-focused is add-on AI features GitLab enterprise. collaborate AI features Gitlab next GitLab of teams the combines Our

as Duo resolution. part coming Our explanation Enterprise, cause security along as customers root such and are particularly of analysis, vulnerability excited GitLab tools the with about

AI to air the gap also customers will further environments. models market. in allow This Duo Enterprise GitLab future, differentiate Duo GitLab the In in deploy feature will

like capabilities business to integrate are These turn security to our they platform be need to GitLab us. and compliance. for continue to process. turn drivers I'd the in to because core and big earlier security Customers to Now development

removed and example, For technology solutions company platform. the major when they point U.S. a GitLab contractor government X on consolidated different

chain doing XXx security faster scans savings administration. they are tool are XX% and seeing Now in

driving advanced in and With closed a total bring a only logo ultimate into sooner. upgrades cycle that SaaS left software their shift across with and deal a a security single and They a At analysis, the services tool are to time, option financial platform. vulnerability for the X-figure integrated is can new would the security global increasing In we capabilities, composition GitLab same and tier. company, life the address was our supply QX, DevSecOps them chain. security reducing our looking cost improve DAS GitLab's software ownership visibility to GitLab. security were they consolidating company of the chain, let

build our Oxeye. for SaaS technology. remediation robust Oxeye with streamline In their for management This and vulnerability will continue capabilities to acquired QX, security We GitLab customers. on we help of our acquisition

vulnerability help acquisitions code of Together, detection auto and will GitLabs intended which run-time vulnerabilities as efficiently these property and this intellectual capabilities capabilities and run-time. the are organizations acquired through will well extend resolve quickly. data to remediation our more And Rezilion, risk also as remediation reachability. vulnerability We enrich from

Oxeye integrating the next into We be over will several GitLab Rezilion technologies quarters. and

Turning to compliance.

with which our single-tenant our GitLab solution, provides of residency. One big differentiators is and here customers data isolation Dedicated, SaaS

QX largest help organization's requirements. public silos the collaboration strict Dedicated build to Europe break while adopted down landscape and across in in maintaining culture a GitLab of departments service them hybrid the of compliance One

strategy. Now I'd like discuss go-to-market our to

We're its Ally just customer partner. past As evolving is more million vendor, a and our scale recently and value are to resilient and recognize revenue, from a customers year billion and Ally $X won to helping Customers for Velocity in we as follows we last quickly. deliver we. Excellence Financial $XXX us so with We move profile for driving customers. than Ally's Financial's Award Operational Technology when Quality Ally won This Award solutions for simplified

integration. In addition, Cloud benefit with application At across contact and for cloud In for helps announced and wider and year. in XXXX AWS experience Google GitLab our Year GitLab the customers distribution. migration Google we fourth the development Technology switching and received of April, our from developer Award Google we accelerate Google category them, consecutive Cloud the decrease the This partnerships Google improve our Next, Cloud. Cloud console Partner

to AWS The GitLab interface, unified our working GitLab GitLab. integration customers, joint or our they the Duo also have in Q. AWS and We're versa. and GitLab vice integration excited gives can about Amazon whether are [indiscernible] using AWS with customers opt in

investing help we of us the $XX market a initiatives. To penetrate estimated are in of ahead number billion us, opportunity

field adding First, to our are message and suite. to global more value we CTOs amplify our articulate executive help the

more Second, also we ensure are to solution in offering our post success. architects services and sales expanding bringing

with compliance we global sharpening fourth, requirements are meet our we such financial presence regions services. security the and markets. on increasing focus specific Third, theater are needs industries complex and to our closely of as And more

During global a firm. the banking GitLab history we U.S.-based second investment deal with quarter, largest closed in the

and our seats. our capabilities compliance Given their significantly upgraded to with success and they GitLab capabilities, core expanded Ultimate security for

of our availability and next catalog. enhanced leaders on as event. of forward part XX, invite and XX. CICD controls information product governance to GitLab looking We Finally, us on on to you website. general We business can be found anticipated we'll join Registration month's GitLab Tour. security planned on launch Many the scanning then DevSecOps innovations including GitLab XX be and XX our are June practitioners. World taking the GitLab the road focused we're for Then

personal as for CEO I'm remain support. of need again responsibilities recent learned like and full during disease last of our in routine the on and scan, time note, thank I cancer Directors Board I'd a the finding the Chair making metastasized. original for that my for unchanged. such, part team is treated that as form I XXXX. working and this osteosarcoma, and a GitLabs My not executive On as scope was recovery to that the their believes treatment the of lesion a undergo doctor to is I same

In closing, to and quarter. market win continue and large team our of focus thank forward for opportunity to confident look shareholders with I many want for your I to like this on support, customers the for we members and their I'm with us. us. our in will thank our I'd you success front partners speaking of customer trusting

turn Brian. I'll that, to it With over

Brian Robbins

XXXX delivered you, our for today. as us start strong team line and growth. top I FY the again thank joining Thank you everyone am with pleased Sid, to

adjusted year-over-year time, operating significant positive the generated cash free a flow. increase operating QX achieved We also for and and margin, first in

objective #X but responsibly. is grow, Our that to continue do we to

clear annual our even from tool cycle, XX% X in were their It that from business to is deliver them quickly. more Customers platform our spend, value lock-in the end-to-end avoid to to able consolidate of report our that customers vendor outcomes to that the DevSecOps allows results and us platform, in competitiveness. budgets software our for savings. our life improvements maximizing accelerate These move release chain increasing they see by Xx cycles and customers outcomes anywhere needle XX the the their realize and to solutions development consolidate into

numbers. the to Turning

of QX Oxeye prior represents of $XXX Please the acquisition revenue our not note of from year. XX% to did an quarter First contribute that QX revenue. million increase

completed QX revenue. or reminder, guided upfront we determines for for when annual a XXXX we which selling FY SSP, and price recognition As stand-alone our license our rate revenue analysis had not

in million we had XXXX approximately XXXX is of million result, That complete a approximately used for guidance. decrease to XXXX $X rates guidance. in $X and by effect FY relative revenue decrease and QX evaluation now As our revenue FY the expected FY

increase the revenue an allocation, XX% million, new Excluding year-over-year. of the was of impact SSP $XXX QX

Going includes forward, SSP guidance for our allocation. FY updated XXXX

approximately DBNRR with net or a DBNRR ended of XXX%. approximately rate, XX% at approximately retention our QX and first priced tier dollar-based at was at seat We quarter XX%. by driven expansion a combination XX% of

than Over this reflective pleased the has see to are growth customers' the last we very DBNRR been our in X expansion in quarters, adoption. platform greater commitment of seat and to XX% expanding

our security of increase now XX%. total We with over with to QX. XX% a previous a is of Consistent we ARR XX% more X,XXX with the an ARR, approximately of large than is invest where of at contributed increase momentum continue our customers ARR and and plus of XXXX, per the of FY X,XXX ARR cohort, Expanding in total improve. the average customers to customer customer our mentioned, additional an importance continues we'll to quarters, in $X,XXX, year-over-year. unit compliance At of of our had resources greater and go-to-market Sid focus cohort ARR $X,XXX larger quarter ARR testament continue customers. for than $XXX,XXX, end of team over ARR in this performance customers. absolute first of have these these to least customers in both number and particular, of as increase monitor drive $XXX,XXX In across we economics This to with

quarter saw allows This now leverage. total represents over that a million CRPO last XX% margins to XX% quarter, $XX $XXX total XX% continues $X.X non-GAAP team loss grew a gross $XXX QX gross the of non-GAAP grew to million were XX% we was XX% margins. again, first million, Non-GAAP of to grew efficiencies and us operating loss while SaaS year-over-year year. in maintain year-over-year improvement million. operating revenue compared in Once for year-over-year. RPO The to to identify quarter. the best-in-class

the As member a than focus team global I'm on margin continued Summit, QX, a execution team's in resulted this really gathering. non-GAAP operating our points million loss a of year-over-year. in more $XX investment reminder, with our in non-GAAP XXX expansion basis pleased which included

in quarter to in FY activities last an quarter of of compared the of cash was Adjusted activities the in million compared $XX of use of use to of $XX.X quarter an in Cash $XX.X million from million year. operating same first free same first last million year. the $XX.X the cash in operating quarter XXXX was XXXX flow FY cash

start I'd few guidance. like a to with on Turning to guidance. comments

First, million line quarter as and SSP updated mentioned I FY guidance with FY net top XXXX revenue XXXX $X our analysis. headwind in revenue already, for line guidance the raises approximately outperformance. our SSP first includes includes

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

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

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

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

update QX of China related to to non-GAAP an QX XXXX, Separately, JiHu expenses to compared joint I'd million like million provide in $X on were our last venture. JiHu, year. $X.X FY

Our JiHu. goal remains deconsolidate to

predict we to million cannot the when FY forecast expenses approximately of XXXX. or JiHu occur. compared in FY Thus, million modeling purposes, with XXXX may we However, related potentially timing $XX this likelihood for $XX

for all In and us cycle. large value the market closing, software our model. a front of opportunity afternoon. The about start was development of a life power our this entire us. AI to our for deliver you DevSecOps QX customers across in of the significant the joining Thank financial highlighting we We're of platform year, strong and the the excited differentiation introduction

that, Q&A. moderate over who turn With it the I'll will Kelsey to

Operator

Thank time joining for us this Instructions]. it's [Operator for and you everyone. very questions. afternoon, much Hello,

from our RBC. We will take first at Matt question

Matthew Hedberg

Great. Thanks, Kelsey.

software more just with of thoughts lot a of Sid, all, lens little the from in environment, you you a you're obviously just you it and there. couple to Maybe our of in the prayers -- maybe thoughts had perspective Certainly, [indiscernible], a looked pull But earnings start weeks. say, on kind I'd an just bit little you, prayers. like past quarter just and out back just bit I results. First what demand volatility Can about here. to good off the this talk and been you're seeing over journey of there's guess, you. continue as

Brian Robbins

procurement QX cycles and for to QX. I they were what cautious, Brian. the in commit Matt, the thanks say, being I'll would any to There question. start they're how This The from macro weren't on macro is discounting from in. Sales changes be to. consistent. major departments thoughtful continues

of you be If business, new our GitLab to to quarter get look at first, first strong. though, specific if I continues business

And a indicator. so great that's

rate what And expansion, second, of better more retention then XX% customers, we we at proxy by which is net for year-over-year. then of and the was reported I enterprise customers, yield than customer than look up that XXX%. as cohort increased modeled. so $XXX,XXX, and a and seat tiering by This existing followed we the view dollar-based led grew The

GitLab you gives look we on the so quarter. macro then specific and what the within some And hopefully context it also at from

Matthew Hedberg

maybe just a That's for follow-up Okay. And great, then you. Brian.

sounded headwind, On feels which want it $X want I is to because that you and just million, But year. provide on but think, I headwind you you headwind. like $X make can million the the call. think, that's raising takes if understand you're sure I want by, that. pushing I SSP about, by, I to through, $X talked full I million talked kind you about a, maybe basically It beat just to right QX like, just to just you more the bit $X QX, be but my the on year sure like math full it color make and to just alluded a you're a feels puts million, you not the clear, SSP this of just said

Brian Robbins

and there Yes, that allocation. on million thanks was -- the reported quarter, QX. SSP it We when absolutely. the XXXX impact guidance analysis, And The based in for the for was completed last we $X question.

beat of includes $X the to the gave the includes guidance And for million so headwind. the $X.XX $X.X million $X The full impact. $X.XX million we year

numbers. would be added that those so And into

that we've numbers we those in So provided. absorbed the

Operator

for Thanks Great. that question.

from coming at Next Barclays. is question Ryan

Ryan MacWilliams

last this are year. guide fiscal to And this increase this update million $XX guide? Just at in on seeing differences in your guide that offered for additional usually quarter, year you any for Any benefit the renewal pricing you you incremental the macro. price

Brian Robbins

year's range is This a out with the Brian. a because quarters Yes. to such there that on Thanks, gave ago wide help couple was this range Ryan. calibrating We models revenue. of

Our that. base go-forward included guidance includes assumptions in gave out, that a our on we

model. internally And report better doing in we're of than I'm happy to we what what modeled internally so sort that and we

Ryan MacWilliams

I for just demand ultimate you're for terms initial did about X Duo that the And the remarks, thinking of as of housekeeping provide item. ARR. Appreciate then of maybe Duo it Sid. I love uptake color. on but a kind Perfect. you one hear how to prepared maybe percentage Maybe for And demand Pro and about Enterprise. other in missed any

Brian Robbins

from all of do quarter. XX% I'll from XX% total quickly. real ARR, up That's last

Sytse Sijbrandij

and Pro the enterprise. for thanks Duo about question And Duo

a So seeing great result the it. major productivity We services financial a developer a of power a in in XX% coding, company on there company telecommunications we've got we're major initial that Duo momentum as capabilities, with sell but infrastructure security a to got stages, Americas for XX% Pro, not reported all and APAC AI deal have made results using to major some wanted great company. to we just

features really is features ones analysis. and Duo for and they the the explanation As like And around like security cause vulnerability, root Enterprise, they security resolution. are the

And So models to to to Enterprise that. deploy gap in air they're looking looking forward that. will forward customers the customers lot our are allow of also future, environments. AI And in Duo a

Operator

Jason question Blair. at to Next goes William

Jason Ader

Especially just in seem have you that know any for both the be was would can model? perceive business, pricing. peers Yes. like and where explored are usage-based most for using the to pricing form of Thank your pricing you. for you self-managed the you I of the changes the cards recently SaaS. some SaaS could I wondering, guys. It

on great. thinking would forward be going pricing comments any about you're Just how

Sytse Sijbrandij

people value we On Yes, charge on example, work important same how the the productive. faster getting more for add cycle more but storage, for it's our is is big based there GitLab productive, XXx The in is part, benefit you as make done. the in make we also we pricing we more SaaS, time most users. -- said, people

costs storage not the example, are For high. very

XX%. is that solutions that's we our not for. kind It's Another indicator with that like making compute and the of margins replacing cost AI, like indicates there's people of with charge what of a ton point that efficient things more we the drive and It gross a down. platform

Jason Ader

then kind road But maybe terms year, follow-up you you priority GitLab think map. just capabilities, is we of on the as this fiscal about in product just Great. would what kind road of say X capabilities. the product's applications the Sid. for Okay. And top quick your of the And

Sytse Sijbrandij

focus, A our ability that's is we the easier Pro, than we point Duo the customers going planning keep in all the but have. solutions GitLab, replace sure can Duo also continue to -- other other security just close, replace pretty point we're of and AI, to Enterprise, X making solutions they replace can our everything better, our companies for solutions. more planning make any that to excited other including the security in driving customers our getting And invest security, compliance, course, to our Really all sectors, and Yes. And make top in with way, think else. their replace acquisition capabilities. all it also solutions. I point of about the our Currently, we'll but our want to investing storage point and binary customers offering of

Jason Ader

Thank Best with of you. you. luck

Operator

Next question please. Nick from goes to Scotiabank,

Nicholas Altmann

a duration anything to year. bit pull that from we've go years on renewal of as XQ historically smaller and to signing there shorter X QX? renewals sequential is seen. to Are mechanically Is is I customers is RPO. activity call from why the there wanted there sort out question, a The the little XQ bit smaller? change a more than to little Was X deals? -- And to into change a the just ask Brian,

out anything why sequential smaller? RPO to Just that change that is call number bit else on a little and

Brian Robbins

is I was Thanks, there the And them growth year-over-year. the quarter. seasonally Yes. is with our in We've QX RPO, being talked QX our some with about quarter. and XX% a CRPO revenue bit is Nick. That line QX, QX somewhat lowest with little within strongest at quarter. billings happy seasonality. a to of XX%. noisy was

strong real finish the And to so we had year. a

as and have So I'm in visibility little that well. impacts where at a we're But it that we the the pleased model.

Nicholas Altmann

that as self-managed million so, to Awesome. support just contract And license be quick Is license post should any headwind. goal follow-up related to how a for the on revenues year? just $X all we this thinking and for if then about

Brian Robbins

that. we to We We down level. for forecast because between Thanks break don't don't going compensation targets Yes. ones that or set self-managed we're don't sales that host.

it's the to it's causes so license, through go of the we and what a over value on versus what when allocation, SSP when time received that's And deliver deem we value the switch. based

over And get so eventually the upfront, the don't recognize headwind we of contract. the period we we recognize because

been $X year, and million what would our out And guidance so we've that. in our included lower the that is absorb last called that we but than have recognition

Operator

question from is at Karl Next UBS.

Karl Keirstead

Okay. talked disclosures being talk growth, is Great. even you a seat one bit stable stable specifically about seat contribution correct the XQ to or to that macro we of lead NRR and would improved. Is in that to the growth assumption? relative reasonably little QX seat believe both slightly Brian, the your about either XQ. Could

Brian Robbins

net seats quarters, I the the averaged back last over X look rate to contribution When dollar retention from a over XX%. it's at

obviously, and been Ultimate contributor. both in, #X that's so Premium. That's the And

Karl Keirstead

Okay.

than it not. more stable So sounds

on guidance, are fiscal Pro including you Enterprise minimal and then anything there, contribution, 'XX add just the of some And color Okay. maybe the Duo there. to contribution in maybe amount, assumed a to Brian, the

Brian Robbins

we going, early. sales calls, Like provided. some process previous our but with on said in the Yes. it's that. included that Thanks time. takes we for It it's Happy guidance it's as

Karl Keirstead

numbers. the Congrats on Okay. nice

Operator

Great.

question next comes from Our Fishbein Truist. of Joel

Joel Fishbein

I Brian. just [indiscernible]

First, congrats [indiscernible].

Operator

fix that. to breaking up a if little. don't Joel, I know there's you're a way

Joel Fishbein

me hear Can better you now?

Operator

Yes.

Joel Fishbein

Yes.

to here, a would you're and I about [indiscernible] So [indiscernible]. scaling Congrats get a Brian, you. to going margin see versus you how growth love talked with you reiteration about [indiscernible] thinking I lot prayers and congrats the forward?

Brian Robbins

that our messaging but of very Yes. that in the Thanks, do growth, We've responsibly. goal Joel. we'll the been company's consistent #X

that we $XX incremental what added cost revenue, onetime added of this of an with $XX and of which million quarter, million that roughly sort the done was million. expense. of in was about at expense $XX we increase Summit, incremental But incremental look was you If of

And so profit. grew did with good quarter-over-quarter, we we that XX% and incremental

Operator

Our Sachs. Goldman comes question from next Kash from

Kasthuri Rangan

describe versus of in months ago wanted qualitative your generative to especially X how features a from light product and today you've know you Chat thing, would competitor, Agile you. GitLab's introduced competitiveness Dedicated. versus also with Duo How and the that I say, just but is AI things leading gap that other like it's I versus, Duo, get that perspective

effect other to one rough gear, reported vectors Agile, this And the price growth. for do you, when additive into effect these Dedicated So in is to vectors Brian, your growth those Duo, that current the reported quarter? of much be will the increases kick of in what full words, in have how contribution your

Sytse Sijbrandij

Yes. that Thanks question. for

a we I -- are have main features, offering the our you But AI competitive we look I with we if think now. think where at later Duo than competitor. Pro were

namely We more the costs reported. customers security can the Duo can more integration at, have broadest our because the time, at only have most look you integrating more deprecate a very that that and use have to relevant well. If we not faster to really platform. them, And features then as leads in save because old for Dev and AI That have use the strong on platform more comes not and of those because we Enterprise, make GitLab, a cycle but they that's have features. can replace tools offering And AI solutions more important It point all to contacts pay they we have also will available. customers. And only in we're we really where for strong Ops.

really think I'm can and offer we and I to exciting, that's forward customers I think help to leading security we're there. with the looking all So AI, our

me really So excited. makes that

Brian Robbins

your mentioned, And Kash around what's Duo and rough all that of number the the on you question contribution. things

On it's that [indiscernible] price the launched, is on new products times that. we've a quantity

the that sold prices sell in we additive of would the month on for so today number in be that business. we'd what that seats sell we given what that the be the would And or based recognize to currently quarter a base revenue and

Kasthuri Rangan

that. from when to I the it, Incremental those the P&L? is appreciate benefiting reported behind I just to vectors, I'm right, all of math today's the much it but because the heart looking quantify process, roughly which growth appreciate the would my And is Brian, contribute how math, growth question. hits the not but

Brian Robbins

We've our that's and separately. broken in included correct. we Yes, guidance, haven't that out

Kasthuri Rangan

Okay.

Operator

Great. very Thank you much.

comes Our at Rob next Piper. question from

Ethan Drake Weeks

This Rob. Great. for on Ethan is

customers to Just customer of resumption ask X for kind any migrations AI gen seeing any me. developers. I initiatives invest for around or behind, wanted as intentions around Are specifically up sort trends hiring half you cloud how the in conversations second they to of look at of step hiring the of this point?

Brian Robbins

Ethan. Thanks, Yes.

tensions I broadly are macro major weren't run just changes per actually that see to there hiring you base. customer would of more QX what As can we the se -- there's not QX. that within the can and the about little the report rate, net And seat from approximately I a earlier And net spoke -- XX%. is bit it retention expansion consistent. that's in rate. I think was fairly retention first and a that then dollar the And order say reflected dollar

Operator

Great.

Next question at Koji comes of from Bank America.

Koji Ikeda

are all for Sid, rooting here. we you us. of couple questions A from

big Sid. for First question, one, picture maybe

generative very lot on only world So DevSecOps code. of is really, quickly. sliver workflows. focus of But a the a DevSecOps And there is AI evolving that's very,

teams focused IT on the today demand and and going ops teams on ops for So that most really out security GitLab? developer teams are on What is driving what's there? is question

Sytse Sijbrandij

Thanks that. Yes. for

of even that's example, You're spend where most help a spend generative their totally right. AI time well. Helping they developers as people And of their issues. code is lot only interpreting the part It's of don't the Helping coding. They time, and for can equation.

bar you tighter security the And address code, up, like to have things produce for is if going have you then -- you've it. have a to then to And coming you quicker. profile, still secure security got

help features out the So Duo generative about Enterprise help AI in a lot. where Super all that coming that. that's excited can with

having only that a and you completely up with AI forecast everything enterprise research something. keeping the incidents, agile people. helps when And planning, to augmenting But have It deliver operations, allocation. also both you're respond can like of with things better going we're has security it's with AI, platform managers then And even faster integrated. to

the really AI to can going we the in for the the do the So we're more better is platform, point have are it throughout the and solutions broader a feed position you platforms more contacts the to better that think have life and the great cycle, and AI you. more AI to replace to excited work

Koji Ikeda

Brian. Got follow-up here for it. And a

Just the quarter performance the thinking about guidance methodology. first the in and

beat midpoint guidance, just right the guidance be X.X%. think by is thinking drivers to upside quarter how from You If methodology potential this if same, is we the not, that? the about guidance the And upside about first revenue should the way

Brian Robbins

that Yes. that guidance in that we talked the various for about we gave that, Thanks Koji. we products The includes have. out the upsides

earlier, so didn't And break that I -- spoke are we we and on as separately. out that reporting

Operator

you to from is mentioned. the what quarter, X.X%, in $X Great. the headwind would have the up the X.X% as thing to Koji, just that you note referred beat revenue with actually first the -- one million to been

Next at question will Wells Michael come from Fargo.

Michael Turrin

It's On margin. what's XX% seasonally me. for cash the one period. Just lighter free generally flow,

to So flow the year? was you Brian, or how of outperformance seasonality of progression course of there. about should the the can speak throughout the just free cash think I And coming hoping drivers we

Brian Robbins

strong very We quarter. Michael. had fourth a absolutely, Yes,

And quarter happen quarter. so first collections fourth in

better side. So spent less we and we the the on side did bottom top on

and on was was some basically some associated And not total. there of X/X performance fourth the was strong spending. the timing, with but timing it that. so But there collections less Timing is about based much, quarter

Michael Turrin

for to mean, far as fair onetime Or us if within more contemplate sort sort QX it between we was free where it in as the operating assume is today, carefully we least something a progression guidance is forward, similar of at look on cash should of assumptions change -- at the sit income of go that QX? things flow? just I benefit and a And

Brian Robbins

because XQ standpoint collection stronger of XQ. a cash is Yes. from

on And it prior some so has really dependency quarter. the

that. at And so I'll it leave

Operator

we if of the on. can get everyone Thank Great. interest see In to you. time

If would yourself you could be X to great. please, limit question, that

coming JPMorgan. is question Pinjalim, from Next

Pinjalim Bora

Brian. you rapid question recovery. for a Wishing One

You assumptions guidance. assumption as Is to on that Does on a of understand raise? said better the the pricing you're include way well? little uptick doing that embedded a is in that there the bit

Brian Robbins

Yes.

I we -- It's that ago don't broke with guidance to we our calibrating We models. a go-forward help like said, be that out. couple quarters won't the basis. out, of a So in break included on

we so year. internally. just full to it's modeled what better And we'll guide And than the

Operator

Raymond Next question from is Adam at James.

Adam Tindle

just it It's Duo. they to differently. bit They ago. Microsoft a want you're Feel Developer in the the to subs you return about initial years launches can Duo -- Copilot, I for to XX back of compare going million than what's ask if it you had guys And into see just million. I to of time. from ] to what I talking little different X paid if ARR XXX,XXX is tens stopes can that the X.X you're I it millions early. announced the ARR platform But wonder next compare might than Brian, to conversations more that know, and months? versus Okay. take like launched but if $XXX in of [ XX that them. seeing versus scale you contrast for

Sytse Sijbrandij

the more of sale question. to numbers more a giving Typically, bottoms-up Thanks where it's we're versus top-down Yes, enterprises, for out approach. not a we the specific on adoption. see

with So also I it the bit Duo takes a were little think later. we coding, longer. with Pro

with Enterprise, think else. Duo I the everything

time. on more we're think I

of We is expectations. excited enterprise AI estimated we're the high do year. GitLab what for fiscal this But is in in foresee years, want majority very not our guidance. impact in also very have they we about our choose have We they Ultimate the What the they security GitLab, of that choose features, customers, Duo CD the security customer and productivity effect coming features.

we've develops think offering got to I rest fiscal really So the Really other see excited in how the of and there. compelling year that a years.

Operator

Great.

Next Derrick Cowen. TD at question is from coming

James Wood

it Brian. by $X for go just went I guide Sid, to to absorbing to million. $X the treatment with up midpoint, we're wanted just back in good At change luck get and more also million. an clarification. next your incremental

it by apples-to-apples, million. So you're like $XX raising seems

the about you're that us was drive half year relative could to thinking at that. how of in back is looks confirm year. of just through raise, walk and second Can the a mix like more be where to stronger And the wanted seasonal a least seen to course Just the lot it what [Streak] over expected of you then half?

Brian Robbins

Yes, absolutely, Derrick.

Your math correct. is almost

so beat by million we And $X.X million. included headwind. That a $X

by what would revenue the $XX total. that to for consistent is expecting add raised so additional the for SSP, million has then $XX but And million million And been. remaining you we're we spread will headwind with close, million, quarter X $XX if quarterly get not the be it's so ramp that And you $X the $X million.

weakest, is and our quarter first quarter so about same. second relatively strongest is is fourth quarter our third seasonally the seasonally And and

Operator

Next KeyBanc. question from coming Jason is at

Jason Celino

new, why? was time one enterprise Great. see already out announcement Maybe And come if planned still the frame to or Sid. for Duo able quarter. just if but accelerate to so, always if around in the Pro, this pretty Curious this surprised were to it? you

Sytse Sijbrandij

Yes, thanks for that.

what is like I frequently the we that teams. we not -- a AI, But think of have we're AI teams with can AI thing, few implementation is the not on rely it's individual seeing help that overall.

an life-cycle have AI not we that R&D team -- we're going in DevSecOps it's IT So the aspect. our change people team, is individual the our and to AI apply just enabling in members, to whole

it going just It's you help going cool the to wrong, what to comments write you It's plan to wrong. going not for summary you XXX you is what of give goes something the AI what next line from have really thing. should you gives code. went cause customers if you root coded. a you the it build, if you kind example, help of helps like help describe it's also actually see for So also and and to And you of

the will some a these security helps automatically. there's fix And of it that. to write the issues it warning, start security solving future, code in you If

very broadness able which going we're relatively as we AI that excited the with I'm [indiscernible] AI after Enterprise to fast apply can Pro, Duo the apply about does super report So and broadly shows show. I think Duo

lot opportunity throughout customers AI our the of a using in ultimate future get great So life-cycle. to software the

Operator

from is Needham. at Mike question Next

Michael Cikos

here. ask have the to full wanted about profitability for profit the and the just rate I year we that operating

size to the to about out? And me I'd just the architects. outlook help scope? that field Sid's comments and expectation longer Can potentially a think how that coming marry a magnitude. investments trying prepared can if much like get from the setting Just regarding sense we of is in in term solution you up fiscal Or or CTOs with raised Is event? a profitability remarks initiatives 'XX moving also spending this earlier up bit in little is

Sytse Sijbrandij

Brian the people. we're talk this go-to-market going already impact for happening to to about we're fiscal to changes leave happening this certainly are is but now, No, I'll these hiring -- it in year. financial Brian? these

Brian Robbins

as Yes. financial is it -- results. we included our in included That's and everything what earlier said

amount do for that based As out we we grow, gave is forecasting objective mentioned, the is on to of as forecast, the operating #X where and the income at looking out at guidance. we're what that but to we're responsibly. year And the

Operator

of for Mike. Thank time. your have out we question. Great, Unfortunately, run you

afternoon's participation. this We appreciate conclude does this your call. So

a you. this time, You to can Thank at talk we'll little later. and disconnect you

GitLab (GTLB) 3 Jun 242025 Q1 Earnings call transcript