NABL - Earnings call transcript Q4 2021

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Operator

Good day, and welcome to N-able’s Fourth Quarter 2021 Earnings Call. My name is Brika, and I’ll be today’s event specialist. [Operator Instructions] I would like to hand the call over to Howard Ma, Senior Director of Investor Relations. Sir Howard, please go ahead.

Howard Ma

Thank you, Brika, and welcome, everyone, to N-able’s fourth quarter and full year 2021 earnings call. John and President CFO. are Tim CEO; today EVP O’Brien, me Pagliuca, and N-able’s and With

market except undertake our being our Following SolarWinds on the made of There, question-and-answer based our expectations is the concerning line business uncertainties, spin-off prepared intended including are you forward-looking in related for the webcast call our transaction remarks, environment These and no our by subject a July. session. this business. we can required also July also currently to impact is This available are spin-off of remarks global to earnings law. on economic at Relations our which from this website Investor we outlook, in will find those and open simultaneously a investors.n-able.com. information on statements press update our prepared number continued during risks completed including to are during XXXX those and opportunities, today’s information release, supplement call. statements the following financial as our to Certain our and statements the of statements, These assumptions, call duty

financial on call is I discussed IR we certain call associated concerning filings IR John. now, release website. and risks information available SEC will to with on our non-GAAP measures. of on Copies financial we financial call, today’s to the today’s When GAAP measures or press the our And the turn today’s specified. Additional are earnings website. in Furthermore, them the discuss SEC. we measures and and statements highlighted with uncertainties is financial unless our A non-GAAP to various will these the release earnings in on be otherwise to available over will measures, from our referring refer non-GAAP reconciliation on

John Pagliuca

we kickoff our Howard, all About XXXX six and ago, today. event. for you us weeks had Thanks, thank company-wide joining

of or fans. is market customer, order to important must our just employee execute helping state I growing MSP enhance more the base of experience feel N-able together few forward analysts, the A also more is we therefore, we Earning we’ve include the in future. media, connect our why we because for prospects, partners, year XXXX. useful strategic implications our solve our fan discussed team than better journey and squarely it And kickoff. from themes standalone our XXXX to XXXX, a where is In thought be to and on leadership Our more N-ablites. so, a the we brand in MSP this rallied an for as has what our With turned laid key around and earned company and to fans problems, would about our industry, Fans foundation overall confident accelerating accomplished, success partner our employees objectives their the and mission N-able and call our phrase, cry the a more. investors our partners as focus partners N-ablite became elevating we on do rally recap industry such business. alike.

in As into a continue months the the Two New fan execute, of indicator looks base in success. environment like XXXX. we will lot be a another to XXXX, Year, ways, growing many still

of phase like with going away. doesn’t for cope to learning it’s world what become work COVID, normal the the look new may With an endemic

want as ever. IT As remain I as which such, to increased cyber these. our scarcity into include industry labor each rising of double-click briefly strong and tailwinds, threats complexity,

to SMEs manage public on-prem work across the environments. digital rely from cloud the MSPs First, anywhere and IT hybrid complexity everything. by on identities assets a is best of workloads, concept IT world, and captured In

labor a catalyst struggling a large They MSPs lot their need enterprises surprisingly, are as self-managing of Not from value. less SMEs to to IT Increasingly, Second, scarcity had too. are MSPs do that’s and assets. their limits to security management labor labor. scarcity for and MSPs. seeing own IT And we co-manage outsourcing use where serves their stacks with more we with IT

given year-over-year. a Fourth in in currency the quarter end at high threats, threat end secure grew ended level core XX% function. Third, XXXX and the the high management bookings fourth a stack, by risk is XXXX the security environments. now the management with constant and wherewithal proliferation quarter our of new We to note Empowered have security on our exceeded their cyber highest in MSPs revenue customer of outlook. up

to Our EDR portfolios cloud-to-cloud N-able solutions. data our by demand N-able for robust security continued protection XXX driven and backup continue and deliver growth standout Microsoft

fact, backup offering protects our over on built now X and into is SentinelOne’s seamlessly platform, technology and domains exchange offering, XXX while on XXX,XXX best-in-class our over endpoints, In which integrated EDR end our mailboxes. million sits Microsoft over customer XX,XXX

new leaders as of N-able data from our protection he where was to of an Voss recently and two Owner business. who VP promoted appointed Groot, Chris we Data is Manager General a Protection, Dell Stefan portfolio protection Product of Management. addition most veteran, quarter, us products. fourth Stefan of data to Chief the Data Protection Product of During the joins

customers console We our as we’re TrueDelta our for continues technology. provide unified how cloud market a single of positioned. the toward a endpoint protection servers glass, XXX service shift in infrastructure, excited on solution is native a built to cloud proprietary complete via pane and across Microsoft our about devices, protection As data native

restore restore and priority commitment to a level to and backup enabling service Data storage leadership of solutions, X our for better underscores Our businesses and MSPs both of higher a cost. the their protection up-leveling number protect of And us. is compared lower times less for same competing those customers. helping their allows functionality for points the

last I as I sharing earnings our continue to practice of wins. Now notable want call, the in did customer

MSP RMM, us won two, EDR, vendor, a data protection solution vendors. backup ultimately chose protection customizations integrations their data with this we Despite having separate around tight leading due built deal a chose solutions a from and replacing for easy-to-use our management, N-able that to First, and invested previous interface. in Belgium-based and six-figure password competitive RMM ARR RMM MSP

our Manager too. were While NetPath and big traffic pluses Automation network analyzer

a also RMM, vendors. ARR virtual and deal a we and a while this win, Second, case, multiproduct our competitive RMM included powerful seamless In replacing led protection cost-effective protection, near endpoints, the data sold in EDR data for facilitated that MSP the six-figure integration land. and offering with Connecticut-based machines vendor MXXX our data protection two

deal increasing recognition fully both Australian-based devices believe as international cloud-based our protection a landed portfolio we of to five-figure including Third, as MSP, N-able breadth. data and speaks for data the ARR our protection deal backup. We with this backup an standalone well MXXX

the Finally, quality with quarter, landed as ARR a direct our deal solutions, we of enterprise-grade Fortune testament in a XXX,XXX XXX company. a to the

manager helped topography, solution Not but only us our this Now was tracking, to nonetheless RMM to win. And an secure on looking we get at be one report in departments. endpoint clear, network our But manager requests its we don’t on unified needs, we invited and internal features inbound This in management exceed did like to vendor. times. management out-of-the-box and focus warranty their remote other to automation asset bid this were consolidate case, IT company process. RFP patch control

also We deals in expansion some the had notable quarter.

support. partner as its multiple EDR. management, This of products First, added over hygiene, security with backup four N-able manage integration of solution their platform XXX,XXX our differentiated EDR, our cash an seamless products our and customers decision, that advantage SME promotes of other authentication value the uses a multifactor manage EDR and a differentiated and security-focused pillars solution, long-standing partner success power core to a and making this essential partner part already partner and

Microsoft and us including testing. for partner was portfolio. recovery RMM nodes a had of a cross-sell backup and data was only we the data over a significant prowess protection differentiated this XXX,XXX prior small XXX believe real proposition protection to technological a seeing Second, of value also our We about protection using data solutions. deal testament number to This of ARR expansion N-able

to our solution to acknowledge We cross-sell as upgrade given large also of best-in-class a the risk several EDR had more partners the additional environment. existing need deals heightened

traction program, gave our resources, and MSP partner technical across Our N-able expansion partner boot and XXXX, care has in deals the success to investment of sessions camps Nerds and as one-on-one over In Institute, amplified XX,XXX Head Nerds and campaigns by teams. continued our MarketBuilder partners support Head trainings. been such consultation

have exceed our set over We to goal XX,XXX this consultations year.

months, lead to introduced the through with more last account we’ve engagement, targeted Over new retention quarterly which partner partners, several opportunities. business and to strategic including increased increase reviews efforts

throughout the be they self-guided continue MSPs our address to of augment And hands-off year. for approach, onboarding this PSMs will are pain prefer we more a best to We training more so programs for points. and adoption to and introducing identify MSP that course equipped

product Now highlights. to some I and fourth want turn to quarter go-to-market

XXXX, previews private are focused generally and Earlier of cloud-based, month, filtering a multiple AI-driven, available protection filtering delay to most in started introductions. causing DNS product content products is XXXX. this of product be we we hardening, security platform new a First, which VGA and in on In threat service.

our improve protection capabilities, including MXXX to XX% for increase continue performance virtual and data we Additionally, stores. data a servers

extending this our of to look are in environments. beyond, cloud year and As hybrid the we core to I strength and rest monitoring

easy-to-use with continue capabilities planning will security are native we yet to our data introduce powerful key and We portfolio, to cloud protection introduce additional solutions.

targeting normal return new of cadence launches to per multiple forward. year, year more We are offerings are pleased product to going and a this

versions monitor the to ensure of As operating Windows continue Apple secure system adopt manage, organizations and capabilities portfolio and to new capabilities, the and will new expand solutions, including MSPs broadest XX, can to range of continue that platforms. N-able’s diverse new cloud

to In and globe. security offerings protection addition, technologies and SMEs able our the be the to are will across protection to MSPs latest we provide data enhancing ensure

situations, we our partners the our good to On our we the salespeople. on level website continue support these of our in enabled brand bring dedicated salespeople better seeing rate globe as channel we conversion on as landing with marketing we expansion reflect front, value. that knowledge In our and deeper are pages improved products. distribution And around a upgraded efforts sales the progress the

and primarily the management account is partner distribution the While for care. customer responsible

is call to I sales efforts. now end sequentially back each XX% turn In has generated acquisition XXXX. with we more a we Tim our to and to in believe fact, some over financial will increase at year the And customer quarter-over-quarter improved targeted attributable thoughts. outlook. primarily closing But in total discuss circle overall pipeline, productivity results I our which sales the finally, will

Tim O’Brien

contributions joining of Thank I be by up to in thanks accomplished out the building for XXXX. well significant XXXX, for you on of what and John, proud all investments today. I’m call and start to the off increased functions, the it our made have foundation and whether our you, to of recognizing by G&A us in us team and how laid systems we we have N-able. XXXX and in rebranding success financials sets security want in

revenue currency constant increase. in model currency basis. $XXX.X and X,XXX XXXX versus roughly roughly of gave million, or with discontinued revenue, revenue on We XX% basis. was faster quarter and million, total I our be our ago. Subscription prior on $XX,XXX a reported of XX% of was XX% total XX% XX% basis. for XX% license when representing basis a from constant was and partners consistent from growth outlook $XX.X representing Partners currency primarily percentage a point revenue financial revenue our percentage a our XX% quarter and maintenance of will to that We or on over $XXX.X XX% legacy full of total which Subscription a on ahead Total $XX,XXX $X.X XX% revenue a constant XX% review representing guidance growth Now headwind growth total X just constant November. ARR our reported our revenue financial fourth point year-over-year year outlook then and revenue than million, of basis. year-over-year both out the the ARR, neutral or represents Other of ARR, represents $XX.X was representing up quarter in results with year-over-year approximately million, turned and FX XXXX. we million, with discuss with a XX% currency quarters. year-over-year finished fourth represent year down grew a on year-over-year ended more reported

cloud-to-cloud in solutions Our N-able continued particular, our security be data by and quarterly XXX our protection Microsoft N-able and and to performance solutions. EDR backup driven

year. new bookings mentioned, John were fourth our quarter in best in bookings the As the quarter

don’t quarter, noteworthy we While it’s comment bookings every time. on this

an that QX two surpassed those is calculated XX-month acquisition XXXX. events which into is to was and a bookings Our as revenue previous on This hurt was basis, sign for both net gives of year, move N-able, to QX most of encouraging XXXX. XXX%. of in SolarWinds the the trailing we rebrand and cyber customer us prior retention, the new incident confidence which Dollar-based

been mix well Our expansion range. as balanced by of net device consistent a as and cross-sell rates driven to retention XX% retention services XX% gross has revenue of additional in both the

was date. to the all today’s and measures fourth including represents is which margin profit GAAP stated, million, non-GAAP an reconciliations those quarter our spin-off quarter items at XXXX. adjusted and couple Unlevered was a of SolarWinds. quarter growth references spin-off the representing carve-out XX.X% and CapEx Also the otherwise some free prior fourth were compared cash XX.X% while compared and included transfers the allocation XX.X% $XX.X contains for EBITDA XXXX stand-alone Therefore, Turning exclude year margins. press N-able in methodology was operations using financial XXXX release. to to a acceleration that to not XX% gross Fourth a of year and to comparable $XX.X and was the free range drive are in XXXX was cash-neutral revenue provided Unlevered the year between reflects of stand-alone and calculated XXXX EBITDA margin non-recurring office were are EBITDA to outlook effective adjusted to the of to Full Fourth prepared July Note operating financials that margin our financials cash $XXX.X investments support EBITDA million historical items, unless a and Full effective gross of in date margin expenses and million of elevated non-GAAP build-outs all in beyond. the adjusted in that in of basis part of XXXX. on XX.X%. to and prior XXXX in flow XX.X% midpoint million, expenses flow outlined XXXX prepared quarter. $XX.X note SolarWinds. we full period for still to approximately the profit directly

cash in was adjusted have year XX% unlevered or for full flow been XXXX XX% of these representing XX% items, free or EBITDA. million, revenue from revenue fourth a CapEx $XX $XX.X would $XX.X quarter. Excluding approximately in of the million conversion and the million over

had X% year. diluted $X.XX of shares. principal with based quarter X.X I for average shares earnings per the times. been onetime revenue approximately million leverage in million, the XXX the based on net mentioned, that build-outs million share of fourth Excluding office XXX for just $XXX the weighted $XX full balance and CapEx cash $X.XX million year approximately diluted year on have would loan outstanding average and We Non-GAAP approximately was ended weighted of of an representing full the

first I quarter financial Now for our will the year. provide full and outlook

expected basis. primarily X% in $XX.X deceleration of in constant quarter revenue on a year-over-year approximately $XX.X first total first due of delays incident most to as in expect million, and approximately midpoint. $XX.X XXXX, margin of the to disruptive XXXX. well new at the in $XX million of representing product N-able rebranding the cyber the million range we growth the to in The the a is slowdown approximately in For quarter for adjusted currency representing growth million, range new following we growth XX% introductions acquisition XXXX, Accordingly, expect of in or impact to revenue customer as EBITDA XX% the SolarWinds

year to a full XXXX, $XXX currency to of total million, to growth on expect a reported million constant year-over-year XX% we XX% or revenue the XX% For growth representing basis basis. XX% $XXX on

midpoint. or EBITDA adjusted million year XX% to the million $XXX at full of range expect the in approximately We margin $XXX

to nearly of North of revenue FX provide outside of guidelines impact I some America, want the is generated movements. that around our Given half

X.XX quarter For exchange for we both the assuming X.XX year, first rate full pound. the are British the and of for and euro

about As while $XXX,XXX a of about revenue XXXX. of every pound proxy, year for every cent is impact is the of full euro impact, $XXX,XXX revenue of cent

if outlook appreciating, quarter the rates has million we revenue our the dollar $X approximately fourth been that For would November, example, have gave full guidance in had higher. given used FX been time we at year

outlook, basis, is to With on revenue FX U.S. heavily are expect is throughout the our year year-over-year indexed respect impact in impact year. accelerate profit, a our constant and revenue implied approximately international, Therefore, XX% the growth revenue to FX expenses. to mix full to more expenses our currency offset expenses As while not perfectly to the the we by

in the So based XXXX, primarily euro. on current modest rates, a we by adjusted to will EBITDA net headwind driven experience

quarter first investments expect margin of outlook to reflects year. half back go-to-market hiring of realize adjusted we In on addition, product the we our made in EBITDA ahead that and the returns

and quarter range of improve the second CapEx X% first in revenue. full will year adjusted year. of into will that the year the implies to margin half this Our guidance X% total EBITDA margin normalize of

flow EBITDA unlevered conversion XX% adjusted be in expect free We approximately to to cash XXXX.

weighted and million XXX total first expect average We of full year. approximately approximately million for diluted shares the XXX for outstanding the quarter

first expect to our XX% rate in approximately be full both quarter the the tax we year. and non-GAAP Finally,

turn Now I to closing for over it remarks. will John

John Pagliuca

I areas Tim. bringing market approach, go-to-market faster. three everyone and going XXXX, into to expanding secure partner key you, of our powerful investment products Thank multipronged bolstering to success and want resources, our our remind

While all on are fronts. realizing have horizons, each progress return investments of different we these

have the I But As been expected with industry my product board improvement the last as been variety by for strength a a we’re and head sit, say I alone optimism think uncovering MSP I’m and regular we The indicate couple and we’re N-ablites of I honestly confidence we of to reasons. forward. the our across a we are resilience to our questions. in difficult globe, we’re to partners and execute don’t take can and fans execute With the and of into the operator, years where that year and for from seeing have per noting going XXXX. that, rep overwhelmed to are we tailwinds steady energy, of are earn seeing our productivity, launches for and new success fellow of in result, new sales well more partner multiple managers ready MSPs cadence reinstitute continue happy partners excitement offerings excited XXXX. opportunities, across

Operator

we Instructions] lines Ader phone have [Operator ahead. Jason first question Blair. The the you. William comes of Thank from Jason, please go from

Jason Ader

guys. you. Thank Good morning, Yes.

So just two quick ones.

as this demand? of pre-COVID really just First, we’re the top like What line gets guys of, beyond. let’s to of kind and year are kind back macro. for one or the Does secondly, you it, feel outlook top to on key it that you think levels then And about teens get to type the back call What catalysts mid- a there? line high of growth? you two

John Pagliuca

Nice Look, Sure. you our Thanks, talked a bit again. Jason. in intentionally to little we hear about bookings. from remarks, prepared

– things. For the gave and a us reference also we point incident, other rebrand couple that and it a predates of the cyber

For community indicator back a geos is that it’s good that the demand portfolio our me, our is leading the and across thriving growing. and and product MSP

beyond retained part. along to right? those portfolio, we’ve and level in bookings customer we did of and So what land, view amount have that’s back we think strong do from that a high on demand, from success. in get we To our retain. I continue to across we done entire QX. model to of It’s the We’ve see And we imperative invested business about even three always a execute so and point a NGO, – the dimensions, think us of indicative of progress that for as second and business the level. expand, question, that the And your teens those good

it. part We’re seeing from better and opportunities that gross retention of

So progress. that’s been steady a

our in reasons. year, end brings another the product to new important fact secure. couple that for as we to coupled seeing security expansion teams the that product have new which that higher help should year, an back to different with us I see a push to with a continue belief. to right are we’ll our can continuing motion our SKU think It the gives that for will we new early that success story, up that customers didn’t gate I three as which to our get of customer things you we’re and which that of last of now folks labor have guide partner returned with sales already We we net bit. help think MSPs opportunity growth new with and well. And as it as keep a all And go things our we’re better the those believe the introduction right? in to into that story, the will for sell is of another that will two throughout so – new of introduction, introduce introduction view sell retention level. us offering the that their demand a to key conversation product coupling additional products help out gives That, And

Jason Ader

NRR going? And then where do see you

John Pagliuca

Sorry, that? repeat can you Jason,

Jason Ader

Yes. do Where rates you going for the see net first? retention

John Pagliuca

Sorry, yes.

retention So comprised the of steady net part expand held the and is retained part. we’ve and in

should So net were we’re the products, expect improvement And there. these when will be when new where year. the than really, and steady, better they some slight I we to we part think retention hold this introducing retention numbers that’s see

Jason Ader

Thank you.

Operator

ahead. We of Thank from next line our go on JPMorgan. question Sterling, Sterling please have you. Auty the now

Sterling Auty

guys. Hi, Thanks. Yes.

is for that. of And in the talked turn does much you think you strong. but to take through, thank long and the you dig it for about commentary how strength translate expected need bookings, quarter deceleration hey, that around really lower adds first a because or the reaccelerate how So in throughout little that customer deeper strength XXXX, consistency the in finished to I want in the what to you demand on the I’m strength but strength comments wondering fourth in I quarter, quarter. Plenty the

So happen for growth. the real the terms that of buck revenue multi-quarter get phenomenon bang needs a to is we in this before

John Pagliuca

of decel. on does the more kind over for the quarters the business and the QX talked are couple kind The nature deals the model as happy strong a give some color. for permeate model thanks I’m ramp of Sterling, to a question. Yes. taking to on period. cater lot that – the of hit performance In or business of we of that a bookings of three we to drivers into the the nature it the business of to four-month to set

full So guidance, full that And year of look released part you out top as guide. QX through to NPIs, at on also kind I compared versus you we products think see XXXX. new And is permeating implied line year here no new if look just the in QX that have at a of you guidance do the come acceleration the well. in no QX one as that’s just when

So that’s as going the of story we well to through part the accelerate be year. as

Sterling Auty

then And one it. follow-up other Got question.

your catch fourth what gross I commentary, What more I than gross seasonally. Just quarter, and on weighed margins? in we’ve would than particular the seen in more the down have margins the expected in were didn’t

John Pagliuca

forward. to Yes. steady hold center but gross It a fluctuate expect we was from primarily will costs, time just margin margins time, very we standpoint go to data from those and as

Sterling Auty

Got it. Thank you.

Operator

have question of from now We Markets. go when RBC Please Matt. Matt ready, Hedberg you’re you. the ahead, Thank another Capital line from

Matt Hedberg

MSP some versus questions. to guess have to N-able is – demand we’re guess new much done back the It’s trends, up improving versus bookings sort for how of back but is new is going of it close question. ask I you to hear. I much that I maybe strength probably of which do you getting great for guys in the specific to decipher more John, booking in XQ, specific Thanks sort to the you hard spin what just mean, trends? building I’ll of MSP pre-COVID how to the think

John Pagliuca

Thanks.

we had as the that we SolarWinds some also, to the right? N-able well, And specific so were breach. So headwinds look, – have

the company-specific so what we micro rebrand, have had or brand-specific, call like some last We year. I’d headwinds

up security continue and relationship of, so our the to as I’d brand build the headwinds pick MSP kind the our say, that to And to continue we those micro we of our as community, we’re with to that strength community, performance prove those MSP offering, seeing as and dissipate dissipate. unique of

made automation So across protection continuing that’s the the data in it. offerings, product, our click the So security have continuing our particular getting an in offering, at we but to conversion I increased, the higher in our integration a on more. of improvements into And believe we’ve we’re we’re definitely talked about more also productivity. particular, do our is we’ve winning part of double there we’re of better, advancements see with sales the is Microsoft, level, portfolio development made the hardening, that winning right? end with that The conversion we our market.

efforts strength the in me and the As we are the a where larger, that’s and testament average get development that win rates than they’re more complex, rates, as win done. more MSPs better shine particular, our even really for our our we’ve to there of actually the and is which platform, breadth depth and

demand the pretty consolidation. We’re continuing the the is high in so to see in market end particular, strong. there And market there, Why?

looking see bit companies space. that, they refer getting money when more a do continuing another. sophisticated. tech shine doing a they’re check. what in into the and acquiring people up scalable stack tech stack one check, often And that We’re And a they’re do little right MSPs to that’s the to as and when are rolling smart enough for to They’re that enough robust are time And that’s we capacity. really platform

we’re and in rates. end that particular, the strong demand of market, strong on seeing conversion So

Matt Hedberg

and where is would the It XXXX then was it your about one versus it’s bit focused? like front-end more EBITDA that helpful. Is it more Got be maybe of it. sales loaded it hiring. FX, helpful. also I’m for Tim, color but the R&D? Is wondering guide some it that maybe Street. of That’s on if give pressuring you you spend sounds – bit some A of a some components are there little can is And color talked marketing?

Tim O’Brien

fronts. A little both It’s bit Sure, there. on Yes. Matt. color of

On more sales it’s fashion. our expanding so traditionally had where direct in regions approach front, channel-led really a sold go-to-market the a driving, only from in we some motion

to prior new have that return. year, going in investments there’s on come the of out in the sales side to touched product then for which So QX there we John on bigger the on, year. rest things which the of to one multiple investments here offerings front, R&D drive, the lead are of for slated some others kind the And and product

the of the driving bit second the key we in of margin year the little So year. those see lower where a areas half it compared are in to investment first that the half expect to of are

Matt Hedberg

Thanks Got it. guys. a lot

Operator

Mike now Cikos Thank have you. Company. of Needham and We

ahead go when please Mike, So, ready. you’re

Mike Cikos

ask Hey, the wanted QX. and the to want rebrand, away understandable we’re guys. the that. Thanks solar And with moving deceleration, thought but from about demand the in guess, for the, I taking pause on I would the wins we’ve questions tout and to here. spoken gen I I to have

So help to that for us rates do us but by XXXX? to for level overhang, you calendar And rates think you an should as through walking follow-up set XXXX, quarter articulated just medium-term you revenue for guys help are XX% XXXX to calendar could then Tim, much the XXXX, expectations, the reiterate XX% willing timeframe. growth dissipate that have how you of constant we’re when growth currency about calendar the questions

John Pagliuca

if then and can bit more this Tim, that’s start you maybe is add color Mike, John. little a I’ll okay.

Tim O’Brien

Sure. Yes.

John Pagliuca

right? refer our customer quite time. saying is it’s reconcile in themselves new help strong impact QX for a look, hand, reconciliation, itself growth. other and bookings to probably the And that that business the some the is, are we’re hey, – I quarter. hand, to then some the In in we’re little in two probably business manifest on and because booking then right, begin probably revenue business. statements the customer best And creating of doesn’t the need QX just bookings often happens – one our there new the headwind number in revenue snowball Mike, in into those in that so as themselves The manifest a to really much that cohort. grow bit a reality they saying,

also, acceleration you year. have of see the in great period they of now QX to And and lower that mean better you then we answer that that from what on that can expand in impact you front. And QX And didn’t add is Tim, new so as acquisition here that those really revenue these can bookings help but sense, go last dissipate which off, sorry, a QX performance really lower obviously on bring really, that question. kick in. also manifestation beyond would in you’ll that, second offering the begin some breadth the add build you cut to see growth customer we Mike’s customers, the that we cohorts, opportunity and to and even and that from as and depth present I numbers that cross-sell a

Tim O’Brien

acceleration XX% was then the the to we full QX. of XX% and see quarter, the where that we XX% over that gained constant if you QX first of of and And rest quarter a when Yes. so half QX period to was half of expect just takes some four-quarter growth kind so here grow the about full think constant more in started, currency of where is I the that year that’s bottom would in quarters XX% out the QX, grow in impact And of bit a over growth that the on seeing we’re currency cyber growth, of closer of rate. perspective four kind about year QX impact. to acquisition and but off of was of expect new kind growth, last add first this a in the metric we felt And customer and constant very the currency impact we growth it the the we as back from to where what the front, XXXX, a that impact. on really QX, in QX year rebrand, little kind

Mike Cikos

So then I a incremental? great. great – Thank normal the And introductions last what sale That’s you’ve cadence more for a us is is that more typical about which hardening, to Thank the bit right? you this is know you. give on I would that Anything new introductions, guys probably wrong word, year was part? product flavor, a be you. know your given Can also new spoken you product but hear. towards return platform highlighted little

John Pagliuca

Sure.

talk the the let’s right? first, about And we’ll then So cadence. about areas, talk

important. it’s think I So

MSP digital right? tailwinds, also SMEs, road macro needs, we are in those accordingly. the reference the these the trends the transformation, around and also labor partners and the in demands take continue those take of our our this build community these So but we the cyber. increased our MSPs, So we demands map and And from scarcity, their that’s those we customers, to tailwinds. the are you three – when take risk And

with also management market referenced those particular, of infrastructure management all right? So to we part solutions bring us help the of in in the that and see that offerings the MSPs help cloud. you’ll cloud of prepared and the remarks, areas, in SaaS So

So expect those to along. bring we

for combination, to we MSPs less to and expect their to are to that’s labor them and efficiency help MSPs deploy help important bring living but offerings can customer kind to manage continue so up powerful more drive an scalable will and world these they repeatable in We areas. in And those easy-to-use, a this that their base. way so at security the across in for everything continue an way with we’re automated do scarce of

as few. far to of market. we complexity on be bringing it I – what As of there to depends level a the expect cadence, Mike, we’re

the the the are actually lot also the education, be What things We We go collateral, that a in have help to sell to market. end on customers. do MSPs for the need of We sell-through their the to mean? mindful capacity. I them marketing, the bring offerings with packaging we to

not this as the mindful to and process, be digest MSP to need overwhelm well. community sell need we because So they to

on offerings two demand, couple, on I the be about I right? year, depending four the to depending expect to depending a appetite, think year. per the So there it’s on

Mike Cikos

guys. helpful. Thank Very you,

Operator

Thank you. Berenberg Magi question when a from on Asset Edward, Edward of line go ahead the We please have now Sir, you’re ready final Management.

Edward Magi

taking congrats strong XXXX. and a cap on my questions for Thanks

in today. U.S. First you strategy, wins from give Can for as here, notable why foreign large your key the forward? view MSPs some comes outside could international we total A of a working of strength and it’s revenue Thanks. included based N-able countries. of question portion the moving it deeper why a little

John Pagliuca

original and our our really via had in built presence in but a Right strong company combination both DNA teams partners. also off. Europe kicked in our with we the distribution local these We’ve when of the Sure. UK in the Netherlands, really

with considered lean with MSP months, So a we’re months strong last, somewhat intimate we a is approach, an continuing and really, that we that’s where to really we’ve in our let’s some relationship XX been XX a have and or presence how bit and MSPs we’re bit. question, into better. own go sales deeper bigger the because now a accounts, do coupling say, two to win partners more Y one, our for their little more What have history. in refer as key to distributors hybrid the complex, teams we looking these MSPs of say, done a in things: geos to to complex multipronged to base do my distribution win a are with We when maybe earlier larger

bit then the that expert relates in we who data And security bringing that a distributors the distributors and that combination cover local that know-how coming believe, touch. expertise personally. that they’re leading And it’s that us that might to with larger that the in global data accounts, that we’re been perfect not combination give end protection for, us the languages it expert helping combination customer has are that helping distributor internationally that particular, our in one. that care the with the expert and really, understand as in – solution where market. looking we’re and And MSP with We’re the winning management, more more I to expertise expertise, protection customer really number accounts, two, wants that security, to intimately. our strategic to that little because to our actually those win that’s expertise that talk Number

Edward Magi

just for Really more helpful. one me. And

You’ve of quickly maybe new you acquiring SentinelOne, approach evaluating in out which demonstrated with stuck the weigh you themselves? introductions, Can cross-sell the some versus developing the cases. product through many Thanks. to technologies key and us has strength times partnership companies you how walk partnerships take

John Pagliuca

MSP. we technology can start that And That to earlier, management ourselves the believe we’ll there, North service whether our obviously the management of We complete lot question. a that ourselves, protection own look what e-mail is we three we that And our do. These proprietary are data password demand is then Mike’s I question our right? way right? with the ourselves. Ed, technology best a And be suite. our build to that Great patch we what mentioned that we We suite, build build if security our avenues suite, that’s Star. at have and suite, our and all it then take

the focused behind expect through that into XXXX. we deploy OEM and would tight where more to with the industry SentinelOne, to We MSP manage make use. technology to it accelerating we through with flexibility for we the go in solution options a will for that to both providing path, are And our that, see took easier that evolves, ways a across another if if to their have that it’s amount bit go believe to new platform, and if leader. a – flex brought a them did best and This to but brought the we us, muscle go in look and of tremendous we little know where be now powerful the we not our to we business, XXXX, we’re also are our did now that’s and better And and potential stack, our area on what keep us have at there that always the – there’s more want MSP-friendly, looking leading to vendor. flexibility of open and believe partner. made case we into And believe, an lastly, powerful squarely we elevating integration where partner we easy means. MSPs this is as through, inorganic should it’s spin we that bring of then in that I it muscle now out a work a up, and that partner with it offerings And the navigate you we we technology leverage

Edward Magi

helpful. Very

store with That’s We’re it to just me. Very excited you. behind been XXXX. for see Thanks, new guys. for

Operator

on you and the We Sir now as of go question Company. have line opened that, Needham for from Thank Mike line. Cikos Edward. ahead please your another

Mike Cikos

quick the earlier apologize getting on for so on had know I the for guys, did I work of upfront things I highlight question. the to real that. long-winded I Hey me want and question, a from I this pretty for follow-up. got you thank to one word, But earlier asked

over the wanted to You all guys, revenue but that? know out discussed the calendar And that that there I of earlier, and reiterate to to Thank holding medium-term XX% the asked XX% to the had willing earnings for at I had target everyone we are time the I make sure XXXX, it spin, and you XXXX on you. call.

John Pagliuca

Yes. Hey Mike, just it looks…

Mike Cikos

right. That’s Yes.

John Pagliuca

– – And and nothing front. I didn’t nothing changed that nothing has – on

back kind a into kind think the you you normalized, on of of our to hit we’ve still getting market kind to product of bringing in that those XX% to medium-term. continuing mentioned we of mid-term points of normal back acquisition I retention XX% to that range confident year, on, go in higher rates, in customer the strategy motion some of and the for partner getting invest the introduction our that if per to that number new drive feel new success in couple cadence team

Mike Cikos

you. Thank

Tim O’Brien

we me Mike, accomplished look last on we’re frankly, We’ve the at course, performance wanted and right now, the Yes. to what are to team where – of just the as quarter we right? for we accomplish.

with and exact to be position would business We’re in feel and we’ve to move begin the this what accomplished, pleased we’re we thought accelerate. quite we we in

Mike Cikos

do Great. you I Thank guys. it. appreciate again

John Pagliuca

Mike. the again, appreciate follow-up I

Operator

you. Thank

have to John remarks. for no I’d As back registered, some closing it like we questions to hand further

John Pagliuca

talking days. attending you you, thank this for and again you and to all forward to in XX all operator, conference looking Thank

Operator

does today’s That call. you for conclude again you. joining. Thank Thank

now may lines. You your disconnect

N-able (NABL) 26 Feb 222021 Q4 Earnings call transcript