Earnings call transcript Q2 2023

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Operator

Hello, and welcome to the N-able Second Quarter Earnings Call. My name is Elliot, and I will be coordinating your call today. [Operator Instructions]

I'd now like to hand over to Griffin Gyr, Investor Relations. The floor is yours. ahead. go Please

Griffin Gyr

welcome, call. and President N-able's quarter CFO. second CEO; Thanks, me everyone, today earnings and EVP With Tim N-able's are XXXX and operator, O'Brien, to John and Pagliuca,

call. we our call to press website release, our This simultaneously at will Following There, being during our remarks, open line prepared can question-and-answer is Investor for our on intended earnings you which supplement the remarks webcast investors.n-able.com. is session. a Relations today's find prepared also

made and are call our release our also based uncertainties, to those opportunities, risks information no the except this including statements impact in on undertake those concerning information this global of earnings the environment our in our assumptions, following of including duty Certain subject forward-looking statements, statements required the economic and business update on currently during by are expectations These XXXX our highlighted filings financial and as market with spin-off available are our we and the statements SEC. a July business. number outlook, law. of continued These to and today's

Additional information uncertainties in with our Investor our and earnings the concerning and highlighted available in SEC. is filings SEC these release and the Copies or on risks today's with them are associated the statements from Relations website.

website. to earnings call will referring our call. on specified, when GAAP discussed available release otherwise be Unless we is certain non-GAAP financial will we Relations today's reconciliation financial financial financial various measures in discuss measures, to on Furthermore, our Investor at to measures. today's of we measures non-GAAP refer press A non-GAAP

over call And now turn John. I will to the

John Pagliuca

you, Griffin. Thank

tailored a trusted the believed us you began to thank a address the for and spin-off, passion growing their driven by partner customer that grow sustainable offering and and winning market business purpose partners. a for we our we and we customers N-able From workforce rapidly help formula who we can a them today. in a everyone, the Welcome, base call understands joining to looking moment serve opportunity, and had discussing

Our relationships business formula. grow, beneficial built model, partners And appreciate we with mutually we grow our on tell capitalizes have this us the them. our partners they MSP as

we anniversary publicly company, track. our second as further as is right pass results today, the second that And quarter our independent our traded an record-breaking prove on strategy

our XX% a growth $XXX the revenue quarterly million of in milestone revenue time Our first strongest $XXX and for standalone million was company. year-over-year became we currency of exceeded our company's since the the constant history,

bottom $XX our initiatives adjusted results strong with strategic adjusted we of are XX%, our and an our with EBITDA an executing approximately original promise. EBITDA fulfilling line of Along million, margin representing approximately

and I'll market. seeing we milestones, but the talk later on upcoming about in our to minute are I what a spend execution wanted

First, the healthy. demand environment is

and XXX,XXX Our education MSP law, worldwide enterprises care, medium health of across small over and partners a including variety serve sectors, finance.

market with on analysts modern-day software And fastest with earlier by employees and the growth the X,XXX as any the SME are also that segment Gartner SMEs desk these year, than help forecasting these through show project strength of data IT spending protection, monitoring, mission-critical to the XXXX. services other migration enterprises. security, rely fewer cloud will Industry of this such organizations

use larger resource Co-managed knowledge, or set a organizations seeing increasingly of are IT as organization to services managing or we allow the MSPs department providers. upmarket, a fill Second, to that IT MSPs acting are going deficiencies. co-managed skill

offering. on management of value great the reports consuming, Overseeing how XX% with to-do co-managed overly complex IT internal of many patch of some and their spend is professionals their add of patch list. just time everything For example, find MSPs managing most patch IT top that examples stating resources management time else through of one a on

and trusted these powering a organizations, which demand software. playing vital turn are in for role for N-able is MSPs

technology meet of market enterprise-grade strategy partners MSP this with empower to demand needs capture simple, their the is SME our to Our customer base.

multi-tenanted features security been one functionality in and this. platform, each R&D is busy, purpose-built our teams for which have data management, offerings bringing And these and dashboard Our protection integrates and of categories. monitoring new across

in We flagship the further by continue capability for to platforms, which received three honors our CRN best of have RMM RMM row. years a

customers differentiate powerful Advanced in offerings. and to provides visualize their enhances explore, to deliver order the they Analytics, that report launched value which ability to MSP's We functionality their

tools, and device one and profitability. Linux in management, pointing the Apple business in Windows, devices, us macro Apple device to fall value With dashboard. we giving manage believe devices This the we reduces differentiate this their trends Apple towards proposition. mobile monitoring and centrally tools helps integrated MSPs our growth discovery, ability increases

In resources in partners a with as are addition, Azure enables discover limited manage Azure such Resource preview we machines and which Cloud Microsoft to and storage. Management, virtual

on-premise into manage As MSPs cloud from the cloud, we unified now SMEs are helping and moving are a management closets experience. of out assets resources and IT server

$XXX,XXX engaged where An proposition the scripting second our using signed powerful automation and ability support and value solutions deal RMM of capability quarter the example us. demonstrating customer customer a a to we our the a in more deal well-known ARR macOS, RMM a is competitor. with than After

for of the complicated SMEs, managing management why are IT the proud are MSPs enables often technicians services efficiently effectively. the infrastructure is task. IT these we And believe our within critical MSPs. charged is to MSPs and of which crucial the RMM we different and depth functionality to that where We matter many our offering say provide messiest a it's at most

with total Demand outpacing well, growth. revenue in for business company security strong our as revenue our from offerings growth security remain

and advanced in we which first quarter, is long for debuted see traction, Our gaining EDR the managed offering this a runway offering.

remains which contributors our product, password Meanwhile, Assure, robust. EDR business. Mail launched XXXX security solution, Also, mail to growth in our and are our management in solution, Passportal, we security steady our

We the reason said customers their conducted landscape. and managed evolving adopting is this are a compliance. regulatory poll security than MSPs more compliance which recently Underlying top demand that services in the X,XXX is

teams their well. as Our daily in this hearing partner are engagements

at the directly highly we of XX-plus discussing the industry For event our spent some compliance heard same customers. and how Business from by thing our example, of we partners, elite attended two rated shapes largest days Security

bright once outpacing protection our company Data revenue again product in suite, is growth. also spot a total

New are customers on year-over-year Cove, our protection powerful data XX% a in up service as product, QX

do tailwinds a enterprises one XX% most intend been outlook we macro into as back, of disaster and Cove The to our critical favorable innovation, recovery a we continue we through at assets, word, one data. for CAGR to with have IDC XXXX. strong of protector category projecting service market of through With build trusted a this delivering. is And

in We've giving standby backups for much recovery flexibility as to XXx. manner MSPs on-demand spin Microsoft than vendors. image OneDrive We and recently introduced by restore much disaster backup as on to demand up accelerates resources more cost-effective a legacy released Azure, functionality incremental the that

we the Microsoft our capabilities Teams, suite, continue Exchange And OneDrive preview. and to including Microsoft extend now Online. Teams covers SharePoint with ecosystem the in external now XXX Cove in

go-to-market innovation focus this Our ears team, our our and on ensuring of eyes reaches all partners. the

partners online calculator marketing recovery on the of our to understand proposition live help now the an including campaign, service for Cove. cost ownership value of total are disaster of the website We

in Cove's TCO to we for that of a released excited about versus future value powerful for Cove Cove durable customers, product shows outcomes that delivers is the a tool customers which up proposition. potential growth. are XX% superior other use savings our market This validates newly options, for and Cove

to and market appeal And sales internal is solutions focus our these is where customers opportunistic Cove area taking overriding share. also while our IT to we market on departments an partners, are MSP believe

mission want our provide Our tools technologies to we to for teams speak about these is our approach our particularly IT harnessing to And and new generative I MSPs that deliver efficiently enable are effectively. Along seeing within products, lines, services with the delivering. are opportunity AI. to them

company. technology a are We

deliver is the part technology strive to of pursuit, employed this We is our Innovation in today. to offerings And in market. AI DNA. our technology SME enterprise-grade

our AI tangible This advanced and and tasks threat monitoring a troubleshooting more technology block leverages for solution and bad identify solutions and and threats. technician and actors. detection automate stops to automated management benefit scripting, For save customers, time, use has to patching AI our our EDR mail AI example,

Looking offerings, innovations forward, the are value. product ladder in cases, including Use working latest the another elevate to productizing our further AI few. technician to AI greater generative protection and of and and we on progress, integrating increase but capability the name of rung technological learning and as we enhance strategy customer offering, developments see solutions in deliver even our a machine of efficiency data our RMM security the effectiveness our in

create monetizable allow needs. we advantage models unique XX,XXX to we have train our approximately meet more insights and algorithmic As from our gained MSPs believe the innovate, competitive effective will a us to and that customers' solutions we

of ethical using of productive are As and earned the is while external risk. socially responsible finally, my an our and always, of manner we of recognition. by which all a globe, the work mitigating this positive across fellow efforts has N-ablites mindful culture driven result in technology And

XXXX our our the our call year, American received for want outlined the high-achieving Awards product, the of have to four in but those and Business at awards half We throughout efforts teams, releases press I community internal Stevies out first we people. that

Best rewards from We Growth. received and Career Global Culture for Company Company Best also Comparably

to the & This CEO is largest focus A over ago, Diversity couple this business our to to X,XXX reinforce this great and months with inclusion commitment pledge. always and the N-able, prioritized our step honored have diversity, signatories. diversity advancing was and of sign CEO-driven the journey workplace I to equality another in was Action Inclusion belonging, At in commitment area. we for

I results And Tim? discuss to back to call financial some and over the With remarks. for would circle closing Tim then that, outlook. like I'll to turn our

Tim O'Brien

Thank you, today. us thank all you and for John, joining

this go-to-market exciting SME more organization, to just a by two demand development testament our of R&D globe. also IT intentionally broadly, of for achieved building value a more creating global product as innovation and bring quarter team of for a quarter, is and teams, the our services the innovation the John a It customers, our company we across culmination celebrated execution over $XXX made including for investments It's was brand our the in year the and X,XXX the in the the over years success milestones. MSP market. to across culture mentioned, N-ablites public customer revenue efforts our momentous N-able. of than our have to both We anniversary As million

from was XX% basis. total second approximately on representing our licenses For perpetual million, and historical of approximately year-over-year or a $XXX.X was maintenance revenue constant associated $XXX.X services XX% results, XX% primarily sales million, XX% year-over-year growth growth approximately currency million, revenue or on constant revenue a representing quarter approximately XX% Subscription year-over-year. professional up revenue, consists the was sale the of revenue from basis. $X.X which Other of currency services with

We up XX% now is Partners our ended $XX,XXX ago. quarter or more of with partners ARR, represent X,XXX of with that from of XX% total over approximately ARR, year-over-year. contribute the approximately ARR which XX% approximately a year up $XX,XXX

second was approximately a basis, Looking at the is net quarter, XXX% or currency a for calculated retention dollar-based constant trailing basis. retention XX-month revenue on on net which XXX%

to measures unless Note and profit basis items release. and calculated expenses are the all and in profit margins. that to press references to stated, provided in outlined non-GAAP Turning non-GAAP otherwise reconciliations today's exclude a GAAP the on

same Second quarter gross period XX.X% the in compared XX.X% in margin XXXX. was to

up $XX.X approximately representing EBITDA XX% Second was approximately year-over-year, EBITDA adjusted quarter million, margin. adjusted XX%

Approximately per ended representing X.X% million quarter flow of diluted of and the We revenue million, America or Unlevered was $XXX on of $XX.X of leverage average million loan was North in quarter $X.XX of XX% in balance share second million free outside of the in earnings net $XXX the XXX cash our principal based million weighted outstanding an the with shares. quarter was was CapEx revenue. X.Xx. approximately Non-GAAP approximately approximately cash quarter. $X and

earnings call, our our the As to and we align cadence of timing year pre-COVID. pricing this closer last forward I packaging stated pulled on annual to our changes

we of to we While contribute for on these expect the growth. X% previous sure we year, the we the to to usually relative reiterate, do impact to comparisons. wanted highlighted year-over-year years packaging To changes, year-over-year magnitude QX and out make pricing X.X% on not about call changes full

contributing competitive quarter, pricing the Given of year-over-year inflation. into a account the X% We as packaging growth. the evaluate change, factors impact the carefully, more to enhancements, and product range taking such second timing was environment pronounced in and decisions about

continues proposition look our we market across to we value As and offerings, the our attractive. be believe

our financial to outlook. Turning

a expect XXXX, the total approximately constant For XX% third of quarter to $XXX basis. year-over-year currency of growth XX% $XXX.X on revenue the in we to million million or range approximately XX% representing

range the EBITDA at an in XX% quarter adjusted and margin $XX.X up adjusted third midpoint approximately of expect We year-over-year million, of XX% million EBITDA to XX%. to representing $XX the

representing revenue now we year-over-year expect raising and XX% $XXX.X currency full constant to year of growth million both total outlook our XXXX, revenue reported For a basis. are the approximately million, $XXX and on

We also outlook EBITDA to million raising XX% are $XXX.X of representing expect adjusted midpoint up EBITDA XX% margin. now full and approximately EBITDA approximately year-over-year at our adjusted the XX% $XXX adjusted year and to million, an

Regarding for the X.XX CapEx X% revenue for FX are assuming we of the and for total remainder We XXXX. rates the foreign we that the of pound. exchange for rates, euro approximately expect reiterate of X.XX will be year

XX% to expect cash also free EBITDA adjusted conversion the be approximately flow We year. to unlevered for full

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

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

we the advance environment while MSPs, on executing are of to will focus back half the the deliver to ensuring strategy enterprise-grade to macro while As technology that initiatives with year, growth. we enter our we monitor aligned costs all efficiently continue our

focused line growth market these as also are from key returns the medium accelerating term. driving brought top we offerings are strategy our in have the of to We our to new to long on

balanced goal. revenue year Rule assessment full and strategic pursue dynamics reflect we EBITDA raised of path Our operational of and a guide adjusted operating as XX sustained our toward our these

to turn closing I'll remarks. Now over it for John

John Pagliuca

higher more level traded thesis when and would ago, A allow our operations little potential. a reach straightforward. true an independent than focus the unlock Thanks. Independent to years of N-able publicly became company, us was two

benefits business. seen enhanced of have the across this We focus our

leadership filled time positions out X,XXX have the have organization from the of spin to We across today. and at company our over X,XXX grown the employees employees

MSPs features Our our our win. R&D core scale empower and team a product depth have categories delivered that within of to

our built with have the events relationships N-able established at teams globe, the MSPs customers. connected has and meaningful and customer go-to-market with organization Our our brand across success

a The new spinoff management, and a writing. data and suite integrated the remains to in continue for protection monitoring and marked organizations healthy security priority demand N-able our keep journey, two chapter years ago solutions. of see market spending we we for and IT

the the macro durability long-term of the the we SME of mindful are of we While spending in of IT. IT secular environment, and believe strongly trend growth outsourcing

provide ahead of initiatives ready with strategic and by customers are they are opportunity and to that, behalf MSP operator, are innovate mission-critical tools We on with invigorated executing them important the services. the to our we And empower need for questions.

Operator

first Our Mike Needham. from comes [Operator Instructions] question Cikos with

Your line is open.

MikeCikos

basis, taking is really wanted Can out for price we quarter And to you going the Thanks out model? a that this And guidance just And think changes. guys. Hi, I more here. I'm around. just anything we more us in annual appreciate, here. seeing the benefit you a at guide, we at trying those questions And revenue those I those tease to And QX I look to pricing changes pricing price is with changes? the all QX? shouldn't how wouldn't back given to to have calling there QX, constructed? year-over-year Tim, just where the through guidance circle on be is I'm benefit good continue this help expect the from least why changes to of if subscription

TimO'Brien

take happy Mike, to it. Yes,

is of the usage not at price of of business well month-to-month is on of And it the that price the some clearly and a increase, realize the of due components components more QX majority the the XX-month time just probably how increases nature the acutely we the pretty I we spelled the the out some period. over as think business of impact as the to felt year. of

that's So I just the QX the say, in what packaging And your pricing more skewing year view done of would the acutely versus of impact probably on timeframe. think I to June QX. historically, changes we've timing, and rest and the reiterate in

we and just months couple the year perspective. earlier in April was Before timing COVID into from a that it in a year, this pulled of

MikeCikos

I'd Got see when guess, 'XX to beat the and calendar it. color. here, obvious I at I then like the again, in I the Got the appreciate then guide. follow-up look so it. And raise -- the QX

to at to where the we're Your is the just cost EBITDA savings a the calendar these EBITDA north that we're dollars, seeing incremental volume I just us 'XX, -- better sense. of you in of EBITDA, on want on the dollar raise I'm guide on I them raise dollar rates seeing on if to How from that just do where get I revenues. about improved you company or certain trying don't for the raise out, And guess, on the model. the think pure if because, know ahead coming we postponing look I it -- guide EBITDA wanted determine discipline? Can Is that's frame term revenue. is is again, help projects.

TimO'Brien

Happy Yes. to - touch John. go Thanks, Mike. ahead, there

John Pagliuca

Mike, it -- I you -- to can I'd in. start, continuing back. in was Yes. we're Tim, or can going cover the then philosophically, and to I say Strategically lean say

could there. stopping going question the making the your In side. product slowing the prepared I'd continue to on on hear to on we So we're you R&D Hopefully, or to to we the We're remarks, momentum back, continue say focus or during are advancements. feel particular, in lean no.

decile lowest of sales now sales saying, efficient? what more have marketing build that brand. you every we're is able marketing. not we've looking at to had years, hey, is lot spend to that and and public and what were being brand and And But sales a said, In in efficient your beginning and and bit to been little that establish for do on now probably the we we a company, two and marketing in

marketing revenue-generating areas and little are sales to harder look bit in not a generating on and of a but return, we're headcount So in we're continuing R&D. in the best that of lean taking

MikeCikos

Thanks again And Tim, for color, Appreciate the comments, over it. turn thanks. Awesome, it thank you I'll well. John. the to my for as colleagues.

John Pagliuca

Mike. Thanks

Operator

Our RBC. Matt next with from Hedberg question comes

is line Your open.

MattHedberg

my for guys me thanks, well. you. well. Congrats Great, start to with as for me want as congrats well, questions from I as John,

of enterprise. found at The larger that are prepared really the to up remarks move something into interesting. said starting I the You start MSPs your

you of I really just sort TAM a be long-term think that? ongoing, kind of the here. this And after. you certainly what that curious, been do big going that's trend Because brought sort are trend achievable it guys is been has could up bullish ultimately a but I'm actual driving of think that you for

John Pagliuca

Yes. X XX Thanks, and for Sure. I X They XX years other this of we're and will, seeing XX in if dipping And right? necessarily a the been question. MSPs Y focusing it's years. were Look, desk. is help Matt, those security. have maybe increase really toe great They and -- And some by dimension, stuff. ago, in and BI on dimension, space helping the their an Tim years, in weren't you were on TAM

out other also of but MSPs bits, like bits a and Now backup disaster bunch fully seeing risk with we're recovery. desk the help helping security, management, compliance,

SMEs when And I about ago, our adding is partner. that true they was out that. companies. a areas, XX than they business MSPs SMEs for XXXX dimension XX MSPs it's they're employees were showing lot to service that down. as to other reasons because we years TAM for that are When trusted you're are -- out average, this two years really XX ago. on Fortune That's the So That's They're started calling servicing up not But so more there's were speak. upstream. adding doing helping anymore. did in going on

one, overall. we're IT seeing in labor Number shortages

remarks. and has now all XXXX a VP up, at that cost-effective an else, maybe IT industry why So they need do of called management patch a so that your something done, at an mature. bit out a Fortune if look more the or MSP the a prepared way can CIO much at more enterprise-grade we work at MSP leverage in the you're example you're more you strategic. become to get now a team that The tools looking can are company and you little go because grown That's

we're MSP. IT professionals labor So one. leveraging the number seeing, That's because are shortages, of

MSPs industry what that the help there, The is front. tools second has have have like MSPs about of I scale. The reason now good before bigger. out to matured. front, surface area, think talking on a help in can gotten disaster in security the I'd these was we recovery The amount allowing

$X And MSPs now we revenue. are in have that -- are MSPs billion

And able bigger now, maturity their these at service so to companies. level, they're

So can TAM, bigger to so this the and they're of well and MSPs company services recurring It's as them expansion Fortune a as we're XXXX mid-market charge speak. X for getting stream for Y it's for afford. or continue to upstream. a a us, they on And benefit go the able a our to are that better revenue company client,

MattHedberg

Or to you, Obviously, I sort there's And good your much curious, did a you Was components for well. really as you just of kind the feels that built vis-à-vis you you a thought? called remarks? Tim, sort QX guidance, the curious That's how hear. on more substantial a like X% mean on QX just kind your then, that. for for of potential the prepared in when sort of beat. benefit what I'm the contemplate increase than of it price of of benefit beat. out question a I long-term kind it benefit of certainly had

TimO'Brien

to for conservative say guidance But we And little QX probably baked the a our bit I say, quarter. I had in to approach the just a QX say would guide. took it more Yes. would generally, we would a lending than general conservative I was to came guidance. into approach higher

MattHedberg

Well Thanks. done, guys. it. Got

Operator

Jason now with William [Operator to We Blair. turn Ader Instructions]

is line Your open.

Jason Ader

morning, you. Good Thank Yes. guys.

is seeing Is new on be But the it at for what Just macro changing impact as not. be Maybe type you're economy from all how it maybe of now. a right noticeable? sense on customers? it's something been. it's the wanted that or to of sort is would it's get helpful. macro. or might like color Do love any some trending commentary guess, cautiousness, other? still same Just macro new would this a But feel is just way the Is one I you projects? pervading comments Just

John Pagliuca

question. term term a from a it is and a relates evaluate demand long what of customers take short different macro fronts, teams of their Jason, we our b, and, new and right, at and look dimensions. in great couple on sales at rate and as Look, success couple one, look the different Number on marketing and trends a SKUs. to, a, new

on would geographies. were And all I say in front, in, things I'd year last so performing better that than say,

demand Europe has our Pac, North it been but performance all whether a little EMEA Asia we're seeing softer, year. by better last than or sales bit America, still accounts, be and

that's good. So

So particular our and security data protection the in is our for strong, demand there offerings.

or that's their been the at The telling moderate a they way moderating. the folks what market little small, by health are services necessarily a you Part enterprises? say, bunch too because -- their bit quarters we've and goal MSPs couple we that shortage. is their expanding a of of can demand I'd medium adding on profit And in reach are is goal look what's labor customers and MSPs adding because revenue with of having and is last not both of going second been, MSP -- the of

quarters. been medium other So small, it continue having add say enterprises, MSPs bit but and seeing what I'd consistent. a that. been We'd monitoring to consistent to see it's love we're I'd stronger been little say in to it's we've

Jason Ader

you. Got

Okay.

more tailwind. So year, few you a if new forward view are adding MSPs fast we customers, quarters, as whatever, would a a and that

John Pagliuca

That's That's right. correct.

Jason Ader

Yes.

can I on And other right. that a clear you I give that All comments had of detail immediate pricing wasn't having more more the terms be. just question just impact. of why change. little this Tim, on in I then would us about an the on Okay. quite guess you talked

TimO'Brien

Yes.

from Just just usage-based for that model. our of a contractual is portion business a are in a customers month-to-month nature good either or standpoint

of the more on But over that in in that past. But is I to realization think impact real that good touched a more QX. on period the and the time consistent we've drove annually. generally, that a what timing for it's business portion of just XX-month versus year-over-year, the acute

So the call gave on the timing outside of there and X.X color about impact points we call -- point on year. to last X of that this of impact

it just immediate of kind I stops timing nature. impact the the without think if and annually, it you look at

Jason Ader

I have was a fairly you changes? And that from typical? to normally X.X-point do tailwind mean X- price

TimO'Brien

I there say changes of what the on Generally, in we've compared Pricing and would part the we -- That's last 'XX is no. our impact impact leaned always to done bit of enhancements months more equation. are packaging out a inflationary little as that due the historically. for XXXX. well some some XX over we've to the as seen past the product we've environment made of

Jason Ader

Got you. Got you.

up? are XX I months changing priorities six for you because front of Do Just would everyone recovery those helpful. to, is becoming it, relative any that everybody. don't bubbling at to feel Obviously, less security top Okay. And -- already know, of on other that ago? all doing you, and there's I don't there and then last for just sort Disaster like be work-from-home, customer John. just question mind comments know, are like center priorities is

John Pagliuca

not, bit or Board that a it's be seeing Sure. with specific whatever X of their what a sharpening. the would is MSPs right coming The I in be, market I'd say definitely industry agency customers little noise regulatory how compliant different. say, might governing -- their and I'd to around is their compliance lot government help the work-from-home That's quarters. lowered, say, can especially top their Really, or or we're and every in COVID the definitely now. is focus MSP, out

be help can MSPs pieces, then, to make sure more the we're to compliant, number And data offerings, and So seeing customers different make that squarely for with sure the that their right? number to one. the compliant. they are protection lands our offerings security two, that looking But us the security of advanced

was risk Security land way, of around So from of SME more gray and or a to game. couple MSPs more by this the or ago us, like -- goes one years the binary security was. Compliance tailwind. of I'd a more type a tolerance a zero for the say what of is

compliant need and And and business, MSPs for for which conduct that, or those you're them around enterprises the be is focus either are driving You there. in security compliant the layers trusted of to on their security partner not. hygiene order helping that them small, they medium that be to to up-level must

been that's It's mind. consistent, in and So has positive also steady. the industry been us. MSP top really M&A not for a uptick. sign it of that's good I've seen

the to upmarket go they're larger, healthier as continue able to get As they're well. MSPs they consolidate, and

Jason Ader

very Good much. Thanks luck.

Operator

you. Thank

Our next Bank of from Keith Bachman question comes Montreal. with

line open. Your is

Keith Bachman

you. you thank I the about how scenario? about organic are as partner Or On thinking level about development a how through you the basis, versus Hi, partner couple. ongoing M&A. portfolio be versus offering, even had of build broader thinking diversification IP think your you'll that add a the investors of versus track just should

that a couple how expands If over the over you that and that offering, years? robust next unfolding do you but you does In other think just words, diversification very of next have do few -- years? how could see the you how

John Pagliuca

just And our a strategy. is on question. great what of some And is reminder, Keith to quick audience, core as product just touching for Keith. Sure, the -- our

integrate with to the it's course, effectively that couple at a from technology leg is there. experience third for here our and IP areas, do better-together the to into believe go because different of we of we But MSP platform of in build amount choose we And So jobs N-able, efficiently, and ourselves. companies, M&A. enterprise-grade significant a we their a the partner

thoughtful through the R&D and A Keith, we're offering times, the make look, as and our through. chosen, mission know with you give we that need an for security. have so from with conversations, Why? Well, the landscape research have with to partnership level solution, we be earlier it that to our MSPs, of fit So what want believe we'd profile, with of -- sure to that's best best do very like we lot doesn't MSPs to as our the go has best to necessarily of think example, the our our the SentinelOne to path SentinelOne. a right? would EDR and partner in development honor And to we've and we we can the competitive type I and

our we we platform now in do can a manage into and policy. is it way efficient in And monitor, and remote integrate with a what MSPs secure monitoring there one dashboard really

that. can I N-able, partner, for do the lagging And need and this we're a R&D look small, leading the of what of be the that, in win we're not investment long-term would make space at call we win, a win get lot the what that SentinelOne; that and competitive, that for that a we a win MSP; medium win times, level in we the space. sure wherever that a to quad enterprise; for we for would case, So in

to look typically and security, or OEM acquire Looking Resource to an usually we We vector monitoring cloud are talked good where it's ahead, a security, in DNA management. there. in our Management. Where about is capabilities. to Apple future. Azure partner DNA, the and depending where IP core about fits our our the and we That's profile. about We'll be in talked more the to And our capabilities either potentially it we'll continue deliver enterprise build where core on we'll look if use is around talking management we

MSP each to of RMM leverage to the right cornerstone. MSPs as first about continues because it's and be our an always putting and can approach, three-pronged I'd strategy it one as bringing that that you integrated opportunity. platform say that's using market an them all So of the something the in And outlined, have the we're a goal

Keith Bachman

to percent just then me. surprised back carryover wouldn't least there quarters for I wanted on clarification benefit, your one go And month-to-month of that are What little pricing. something the to a the for just I'm next of longer? be Great. Because at Okay. contracts a versus couple pricing.

TimO'Brien

business. the combination two-third usage month-to-month a I'd Keith, say are about of across or

over and good of through that of XX to of X.X a other one-third is points X months. the next coming the it's the driven to So portion fruition course impact kind

Keith Bachman

Many Great. Okay. thanks.

Operator

will closing This to our any CEO, concludes Q&A. hand remarks. Pagliuca, back now John for I

John Pagliuca

sure. Thank you, operator. Yes,

a the about interest N-able N-ablites Just and world, your to all quarter's ongoing across thank for of on you in to behalf in you forward talking looking X,XXX time.

Operator

has this for participation. like Ladies and thank gentlemen, you call now to concluded. your We'd

lines. your disconnect now may You

N-able (NABL) 10 Aug 232023 Q2 Earnings call transcript