INST - Earnings call transcript Q2 2018 | Instructure Holdings, Inc.

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Operator

Good day, and welcome to the Instructure Q2 2018 Earnings Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Erin Kasenchak. Please go ahead.

Erin Kasenchak

Thank you, operator. thank call. joining and quarterly on everyone, conference earnings afternoon, you us for today's Good is hosted call CFO. Today's being Steve CEO, Kaminsky, and by Josh Coates,

we a the actual materially. Company's you expectations. These and to will Before our are results forward-looking significant current would subject risks statements conference uncertainties, to include on differ today's of call remind based statements forward-looking I begin, number may that like and

except business, please update transcribed a other by obligation prior Instructure's future as as and Commission. For made may assume no based are call of financial today's such with in today's Exchange be could factors any reports time-to-time we our reproduced required Securities or the without us we the today, of information to and available our law, affect to refer earnings on discussion that The and filings cannot is file to and conference disclosure our from content statements. statements All property of and consent. the today as written results of release and

we call, non-GAAP both GAAP also measures. the During refer financial may to and

the our press of can included Relations our You to posted release, Investor website. of to non-GAAP which reconciliation GAAP section in is measures find our a

non-revenue we measures All state of a the today measure. unless discuss financial that we is are non-GAAP, will GAAP the measure

the to CEO, Instructure's over Josh turn call like to Now, I'd Coates.

Josh Coates

us customer capabilities. a glad XXXX came year-over-year and teams him us. short countries. in and on to a We're our the dug Thank call. Board, QX since It's across had we on revenue with into everyone XX join and across am XX% joining visits time he's weeks We customers up XXXX he our surpassed multiple with have with locations have QX call. were solid you, Erin, eight made met product Dan thrilled today that but us thank for you I earnings on to been

was busy Canvas a Group. quarter the usual quarter our second As for

Let by for school serve some universities learners Canvas State to is is of faculty great support to wins Canvas in with ASU of Schools and for LMS, our in to K-XX but Higher Hamilton to market largest as highly Arizona one quarter. districts in XX,XXX XX,XXX the selected County for almost recognized the only students chose Blackboard. students XX,XXX me largest replace Public both their one the public their selected County, their Arc Florida help the country, share not Tennessee one Blackboard. Collier their and also Ed and the U.S. initiatives. of University, over STEM Canvas number replace ranked and in

Law great learning Chancellor and innovative Canvas to Cooley in our prepare a And customer. Exam deal Virginia for the to Vice the the Academic using row. at strong at Blackboard's was product Higher LMS Gauge our Higher the students World is finally, and chose centered first with case although Canvas Western Gauge most this student for of Community Research incidentally use, Gauge to directed in School; digital for focus market foundation content remarked. course the be to maximizes of switched and WMU-Cooley Cornell student ships K-XX University ease platform and Ed new first had help schools would Ed. role year we simply due the our Services Gauge learning the our on and Michigan University replace Arc use managing at product Bar third serving from environment XX Sharon Blackboard. school XXX,XXX Cornell With to Report success. News BCCS Morrissey, the the of students in College America for as of system a in

markets. had we quarter our international second the during International, to solid with Moving another performance

a Canvas you Toronto, wins replace with pilot Canada's with students for Canvas. ranked top Blackboard. conducted selected University The share university few of XX,XXX a to me After in of the XXXX, successful Let

We over XX,XXX also first had Ireland learners. with Institute with our Technology higher in the of Cork education win

mentioned XXX,XXX districts And all in almost over to Canvas students last in the to Norway using learning K-XX inroads students we XX,XXX universities the Ed in quarter its year over faculty we equivalent are this we replace as municipalities selected different As their in LMS. make of have Canvas. Two Norway. and continued market Higher school which representing

senior also as enablement and partner for training of Qualtrics selected Taleo suite corporate the Learn, well our and Missouri largest as Perform Practice, They their Bridge Learn domestic for U.S. Oracles will second as in selected will Learn, of full and Practice, well cyber our Bridge Arc full and awareness provider of their to utilize living Retirement, sales XX,XXX use Bridge market, to Perform Bridge for Turning sales State learners the for their the our Holiday Arc. the employees. Arc security team. XX,XXX global of training. as suite replace for

last extended quarter continue see to increased mentioned penetration the As market. in we enterprise

development. of suite loyalty Bridge our training on well including the of program. the Kelley quarter as offering ability robust Learn Perform, selected for internationally. Bridge to orientation is focused starting some to training Arc bootcamp employee and offer new to and a and by chosen Bridge as Cox Automotive, was products Blue traction to Bridge make employee the training, help development Book, and During also of and Snider like because comprehensive Learn Autotrader.com second Solutions a owner Fleet manager increase customer

connect with listeners employee chose MARTINI for Let some our Bridge Arc onboarding. radio to use in million Radio It me and of was on and week, Colorado. for our Global Learn user replace us as and The leading an UK the you employees. Learn conference with service. to company week in event wins. is with replace X,XXX Bacardi exciting employee The training great year, opportunity with share international Bridge SumTotal selected add their LMS X,XXX This global to Bridge of to attendees. into global long-term with to particular Last their a as over a will of half-day annual kit customer to development engagement customers. well almost and Learn and distributed deeper pleased company users workforce as we meal bridge InstructureCon, day for a conference our do and a investors products and Bridge emphasis largest Litmos Europe's for And a HelloFresh, we strategy. Arc our always analysts employees, a held dedicated dive session for two XX were sales

have person, Investor If you weren't able still you an to view the to analyst session on in our opportunity the website. attend presentations

of strong quarter and year. the in Instructure was half a for our with we're first pleased quarter Our XXXX second performance the of

Steve turn over I'll the Now to it take numbers. you through to

Steven Kaminsky

XX% grew million. $XX.X up $XX.X revenue Thanks, XX% year-over-year Josh. to million, And from last year. In was revenue subscription QX,

revenue for XX-month XX-month second As calls, XXX% net quarter the than guidance XX% and million, were at by rolling you've heard last $XXX.X primarily QX for retention, also versus revenue of strong last on early billings starts been end a several rolling has contracts. me calculated year, our the greater which basis. outperformance the be quarter new remark up our to of from earnings on the driven continues

in all giving calculate billings well. XX-month a before, more for highlight this you billings the perspective growth provides manner a rolling which business, I'd of basis, seasonality on me to growth, consistent heard you view of as encourage As our we and

commentary, and noted, for unless a are basis. will of all was margin remainder numbers For the per XX% just otherwise share EPS discuss shy my QX. in I non-GAAP common results Gross of

our in expect on margin I closer improvements to several gross last the as we to continue XX%. mentioned calls, As target forward long-term of moderate going we get will

to loss for was from operating Net per loss million. same quarter for was $XX.X $X.X million in the million year, quarter share. calculations share. QX Turning $X.X or operating GAAP up quarter million, net $X.XX operating expenses, the the the $X.XX $XX.X EPS in our and prior expenses non-GAAP or per for loss total second were was XX%

Turning million. securities $XXX.X cash to June and cash ending and XX $XX.X sheet, for was for million balance negative equivalents was the marketable flow our free of cash balance

season is and a QX heading As a large historically we cash our reminder, quarter. generating are into busy

As total will We due last total clarity, in alluded investments includes we we from the flow towards Day negative flow to likely look full-year, dip for slightly our week. cash Investor increased financing activities. products to as cash and in anticipate cash new out our

quarter Let me the full-year XXXX. conclude third with and for a discussion our around expectations

of For quarter, loss $XX.X net revenue range third of of $X.X $X.XX. the share million to and the expect $X $X.XX million, we $XX.X loss in common million per non-GAAP to non-GAAP net million to

sales expansion it opportunities takes from the that full-year contributions we into take like XXXX, million, included within we to the long, of $XXX.X revenue taking the these new pipelines do guidance For term you markets introduce are think I'd around expectation multiple Gauge, expect these Perform represent, to we we as are as in to and encourage are newer the everyone our judicious build and range approach million to remind topline. products about the months cycles products that time like note, all of On this near-term the $XXX.X is to generated products I excited a to about Practice. time where revenue same.

of loss per to common $X.XX. non-GAAP non-GAAP loss million expect of net million We share $XX.X $XX.X to $X.XX net and

with look the For Josh progress we our for our million we're to I third forward to updating quarter on conclusion, next quarter questions. your with that, expect and happy be and and I full-year. million to $XX.X the for shares our calculating pleased $XX.X are And performance take second EPS, In quarter. you

Operator

go with [Operator first We to Stanley. Morgan Essex Instructions] Brian

Brian Essex

and afternoon the Good for Thank results. taking Hi. on congrats the you question.

Josh Coates

Brian. Thanks

Brian Essex

Where in you seat sweet you to talk What And if maybe could XX,XXX that see Bridge. you're market? initiatives that getting getting It's are traction of migrating? about Is win. your what are kind that traction that if Josh within efforts any? spot? nice deal is seeing

Josh Coates

Well the making talk Bridge, modules in you're one the offering. in of if just that's about thing going addition difference the the to it's a I think - really

adding customers, with we're that with disclosed warrant And going enabling I to from of them and kind especially and larger larger Perform, these see starting overall of to to weight, Practice allow that roadmap just more really have vision us Bridge. think Going it's also our the to and enterprises. we where those

So to of think that. I we're because traction, starting primarily see

course, to getting and in of relatively Secondarily, Bridge. sales of been at better time, amount a ropes. little take around in market the learn it we're a time We've the does short general just

those what's to I that. are that's - really contributing think So

Brian Essex

should the has models our think fine-tune in And do side? academic in more been on into the or the conservative XQ, - guidance? might you have visibility given that that guidance? guess how the context we as think the in seasonality it your we that particularly past? I the And less about to How you than it Great. much follow-up do Is you pipeline your and how has characterize

Steven Kaminsky

Hi This is Brian. Steve.

Instructure. guidance, guidance. at than visibility So pretty And that our time those quarter. all, into based show little I first obviously in XXXX, level typical. to think of pipeline, By on get usual pretty starts it's is there big its have QX getting see our XQ perspective Obviously, stuff up This of getting a hazy, We pretty as a clear respect nothing from unusual visibility give little starts our we the a of bit numbers. pretty With the really other it's the to cash guidance achieving there. starting pipe, QX we're but business foggy. by on is we too confidence it's

Brian Essex

next into one terms pulled taking relative growth deals we quarter context look as Is of at year-over-year? in the anything particularly there the the getting versus rates around

Steven Kaminsky

mean, of deals where not are in showing up. unusual I behaving terms we're

So going on strange there. I think there's don't anything

Brian Essex

Got it. much. Thank you very

Operator

go Terry And with next Tillman SunTrust. we'll to

Terry Tillman

taking you question. for Can Thanks my hear me gentlemen. Hey okay.

Josh Coates

fine. Yes,

Steven Kaminsky

We sure can.

Terry Tillman

you're And like, the where mean could commentary, could now you than of range? question year? in investments - about could first the of the little you year dynamic debt you earlier a cash a is a you flow bit couple notable for give provide the little Okay. talk the what in us that bit maybe more just or talking a terms dipping make Steve about are for earmarked a more different little

Steven Kaminsky

Sure.

low relatively a about talking number. we're yes, So

of something or like We operating expense have $XXX an so. plan million

at more to a investments about. be things of Bridge, on So still like interesting Meeting spirit What that small to that Day. going think the going or with come Canvas going interesting The lot Analyst the they some a became side. lot into investments there's from months, we had three we would are we've Analyst last to the and but and We've seen four over product it's also people to pretty that exactly engineering They're Wednesday here relative further the entrepreneurial of side activity our us doing ideas is and number. that are up lately. it's - in on on what talked a about

ideas And along are pushing Wednesday. of worth very we we some in areas. we on those so But it's about those the of pursuing, are think and talked lines envelope things the

Terry Tillman

Could that of mean could mean new idea a entrepreneurial But the regularly? more potentially products spirit, that greater though I the appreciate volume that. of

Josh Coates

Well, XX historically probably - I to about you'll don't we first more every new than the released think products I we and mean revenue year. next of see generating I know, have XX months, half talk

So of clustering there's sort tell like last a see you sort that compounding going the little over there's energy XX just year. been we'll yes, half of can It a and months. I'd fruits the first bit next just of of But on. of qualitatively I say seems innovative

more than yes, say you usual. able might to So be

Terry Tillman

of up terms I'm on is, Practice. garner from it you. was about what and you deal them a wedge to one can sizes was Perform the picked ideas Learn? like Thank it's - the get important interest costumers to and in there we a curious in buy is conference And Okay. similarly things What of more

Josh Coates

immediately really it's improve. Practice is tip people of human enterprises. invested for the like in. understand spear that Terry, an very capital it's dramatically intriguing Yes, they've larger can these The product, how sharp they the innovative

I doors, get of yes, so in And larger a especially enterprises. this lot these

of just the actually is isn't size us in really because get Practice enterprise Bridge with the as the that larger with something getting pushing deals as sales their Now alone numbers on selling we're door, Because it that we're we're deal is what Practice follow rest longer. goes on. to far hard they really long-term it that's not cycle to And of but out doors been get in the it's of what's vision. Practice our the the us line, able value see we're seeing whole near-term the Practice definitely to we're In really see the of the would into the get us that see Bridge, But bottom into. Roadmap, will they contribute normally near-term. they seeing the course we be start

Terry Tillman

Thank you.

Operator

Furby next go we'll to Company. William & with And Justin Blair

Justin Furby

you And really maybe a on? guys how a necessarily tell the business new first Can couple number of can things Education there education the how called the the what's maybe then side that's a first what and you and update XX% and a business still this on both give a doesn't the Thanks. tracking broader just wins of of half guys. you'd of you're sense, give just international? on you hoped? going full and standpoint you to an to So on year out can from Bridge quarter you're versus billings sort give trending nice whether And Thanks of XX% domestic number the the target? just sense

Josh Coates

new as seem Sure. to with qualitatively Yes, far business things Canvas tell of as with I I you be side goes. deals academic the track mean can on

and Our normal is as domestically. an high seeing increase especially in which unusual wins win opposed rates this not we're market to are in very deal very steady

goes. So yes, steady as she

of bookings we On Bridge that side told are tracking the XX% XX% we about to time. new last that you to

other any yes, questions. So

Justin Furby

Thank you.

exchange Steve the Can Foreign back Thanks. what is? just guide for any there your for half exposure impact remind the is you of us the year.

Steven Kaminsky

No.

but unusual. don't, to you we we I guidance estimating so impact, any forecast exchange give So don't we foreign or are not anything tell can

Justin Furby

it. Thank Got Okay. you.

Operator

Needham. Next up is Scott Berg,

Scott Berg

actually deal you've target one follow-up, Higher Ed. my for have, look that a Gauge is before? tell the Hi, what Can That's first opportunity mentioned Thanks And Josh exact it K-XX? not than the heard maybe case from in taking a I then guys. us market do product, probably different that there you how use the guess then at for really questions. have one, first you with is help you I've as I perspective. TAM

Josh Coates

Ed is targeting Yes, we're that Gauge not for the Higher win unusual specifically market.

you for Bar Bar know the using course Law Of School it Exam for the is practicing this Exam.

a certainly case. that's So use

Higher specifically sale. I going Cooley. the still for Higher of of we're know you the not think It's match it's not K-XX. professional generally But you're like programs, was an specifically mature for type case can - not focused in we'll very things to And mean schools, still targeting market, like to Ed core think Ed as to Gauge it I when WMU opportunistic more we but be of more have a nursing Gauge. cases much not in going especially on We're that. tell no, I around we're use clear the use say really with is we're

Scott Berg

professional my year? in actually the don't for least the of one question were That's some Okay, at my should know around or from is How and That of of services work then Steve rest about by got shifting follow-up it. model if to we And kind maybe X%. revenues the year-over-year services. completion down think anomaly just I the that's period helpful. next?

Steven Kaminsky

forecast so our see And anything earning we Scott. don't do in we non-recurring not We out usual on it break particular. revenue. Yes, didn't

have on So would about range more less, range. little to there's the XX% typical year, a it's year was give or and for normalized, I in and in this about is professional talked we significant that unusual not year did total, of I say always amount XX% that's but of XX% but a going services normal. we take not that the meaningful. the and that K-XX Last talked think it's anything bit This if we've of about

forward think going it. that's to think I So way about the best

Scott Berg

taking questions. my for Thanks helpful. That's

Josh Coates

Scott. thanks Yes,

Operator

Peterson, Brian We'll have James. from Raymond

Brian Peterson

Hi, thanks question. taking the for

into in commonality competitive how dynamics, I any wanted traditional Learn. So pipeline? use there these extended cases? there case opportunities enterprise the more to versus hit are use LMS on about if coming differences any And are I the Is Bridge think for

Steven Kaminsky

awareness. something the a - that one have security a is enterprise less it's mean works other Bridge. But recent of educating but it's This Learn. less the case use - modules question. well we for in State a use win I Learn. for for really Bridge with Missouri big that's great works the mix on Yes, that of a large great customers good case we're with the extended it's particularly It with employees well for suite, state and

we're so opportunities. to to target extended And enterprise going continue

Brian Peterson

out upside. XXXX, maybe and you the terms it, think that - back a thousand base schedules Steve, in outlook Thanks Has changed anything incorporated driver Got for and the as two of called just implementation how of into one we guys. implementation for and as really activity XXXX? you to or thousand two customer early the guys across have

Steven Kaminsky

don't it. Again it's We forecast a variable.

So not beat two we're not was typical early so to when don't. anything faster But news had quarter, It's and timeframe. the than happening this we're happen. bad that. seeing they driven it news, with when implementations no, good unusual by we a largely implementation, three-month totally okay That's they and

Operator

to Greendale First next go Corey We'll Analysis. with

Corey Greendale

good lower want to and the question, the my to Quick including Hi, afternoon. but altitude. Good you cash Steve taking to on dumb question. you activities. down be change verified, really question, I at cash talk you Thanks finance say that for to it's expect in when

of and not the the including that correct? You're proceeds secondary

Steven Kaminsky

cash through think $XXX we'd to be No. Yes, I bring pressed Corey. of million hard incremental

had happened correct. that if as XX. December on So, That's

Corey Greendale

Yes. have why heard it's a but companies. dumb other That's question, I

Steven Kaminsky

That confusion. was asked. No, no there to you make is sure I'm glad

Josh Coates

know. never know. You We

Steven Kaminsky

good. it, Got

since did that, heard decision invest thinking on the that you sales. sales people, from it feedback, incremental getting you in more versus the to dollar investing are and - related requests product product you our incremental, I pretty why sales make based for that are I've you're from international like the to just from about groups in is if sounds but. some So incremental know change

Josh Coates

- hear jump we great why Dan Hey, question? on a from opportunity don't to Dan Do you that in. we is have want

Corey Greendale

Yes. Hey Dan.

Dan Goldsmith

and that's as in and picking introduce the more at now investing on of and Hey, suite international there's sales that. example, of as on scale lot sell organization of and and products we'll sales Obviously, and investments, new question. I've working sort start our sort the products the same we extend launch our on to needed. go announcements. is grow Bridge always upsell for of for Right search a for to working can sort launch teams. markets predict you the look of our products that Yes, of as the programs and a on observations things sales team the to good people domestic when cycles people. terms and things both of and we with both important in model, case our field strategy an both doing new That's continue sales and investment teams to in current been the sort logos and

Corey Greendale

Great. you as I jump more [indiscernible] And you actually Dan, have in. as ask can one long I

Dan Goldsmith

and Josh are I that. filtering all

Josh Coates

Yes.

Corey Greendale

right. All

if needs haven't up but look growth that guidance the of growth to going you look is are rates seeing kind overall question of - the maintain as rates, in The that's kind to So similar are support needed sort growth given you of you just, sort someone you. that as I term growth in would to muzzle, particularly but earlier realize pipeline longer rates pipeline the on forward? Bridge, rapid you the of on

Josh Coates

let Dan we that? Should answer

Steven Kaminsky

pretty tough That's question. a

Dan Goldsmith

Bridge buying is into of of cycle and tell great Bridge, we're sort At has weeks experienced a perspective with here going an of in eight Bridge. from what and you Practice speed, is implementation I and positive where of still a hose. I've new seeing sales is very sort early the we've of that. a and just how the which end cadence of to growth and to overall goes mentioned, as customers drinking sales a from relatively and been sort cycle the Yes. fire customers vision more of well we're it's more day, companies organizations and existing example are as absorb Canvas, in then as different mean up that obviously coming

incremental the of the taking product that sort Some of by Bridge. of At others organizations sort are and with approach outset suite an Bridge more story journey into product. are extended buying

don't quarters, we sales, continue over couple that like. way So we'll what there's to down. or with I cycles I serve the indicator then normalize think sort of of slowing storm and another think sort one looks an methodology are will to things regards accelerated into next sales

Corey Greendale

Excellent a Thanks answer for only week. so much.

Dan Goldsmith

you. Thank

Operator

next Oppenheimer. Schwartz Brian with [Operator to go Instructions] We'll

Brian Schwartz

thanks and Yes. investment questions follow-up. for and my the one this afternoon, got My I is taking Hi, in half. cycle question one the products question on first second

have So we the understanding.

just linearity have how would the trended follow-up. this my hold. expect improvements that similar I the year. this kind your investment operating business products year for those when expectation take going it last? just It's of the will duration of cycle the improvements the how investment maybe model the I'm this think is do wondering then Is products for this to of So long I opposite you the expectation it trying the along with for a that linearity year? to - the understand of about look next to to in think cycle look be And will of or lines you how long it

Josh Coates

the product that question the our know strategically critical half products implications. on making just making, we'll Brian, currently to putting is level give Yes. into we kind you. and developing the kind then because new about his Steve answer demand sense quantitative if that investments say And some first are difficult I'll of that to we we we let excited of that overall we'll of see corporate It's give - I'll and question see the continue of we them market opportunity, sit back, it. of strategy. and get we

we're So not about shy jumping in.

on seen several into And we've deals have opportunity see we just The and corporate the of think feeds now broader end historically. customers we're the over on closing more kind we market, more it higher opportunity and of I with across builds more think I itself. it the just market, the last than quarters, more itself. international expanding

with to And next new tell I that can't going year, balance love opportunities the be this the But we bias you a you little that. building tell judicious you bit oh, on products, try towards products can that We growth. those so we so about the and decisions. a continue and is growth that. love I love we'll tell expenditure out these I have internal year hey, to of we and costs mellow high can't and

towards tell we'll a bit to And - yes, tough in. bunch And continue I little a but I It's but a tough. it's have bit position to - have, the Steve It's a that, think mean the problem on so there's have. a I know, you a a good topic. to problem about of just for bias brain of whole it's there's dump a little of don't can be good to numbers. you little more kind it's

Steven Kaminsky

Yes.

what we've saying But said is very too Brian, with as been about it's So of detail. all along. obviously way early to talking consistent start XXXX and kind any Josh

down believe marketing most G&A, very big We R&D and and right. look front slowly. And of at it's we the very look R&D P&L us. will reason we As the we sales for and and have in markets that lever

that completely believers, true in Again, bias. this, investment organic. good smart. on is that's are be growing so but a and TAM It's binary doesn't always not also to organically it We our completely although rollout going

We will probably want. we we always if possibility, be much to we exactly that can very and rule don't probably we'll faster as Hey what a about be closer careful out towards. it, build to the it bias get it market have and we but we'll

three. is XXXX, G&A XXXX, of about think sales So and and going fastest marketing G&A's as slowly more as we'll XXXX, leverage to you quickly, R&D the lever more

to the about But to from think just lot it. Obviously, about by the that's I XXXX that's And perspective, way to color it. to a more so think now, for about best a think we'll detail. the probably QX, you in have probably for way time get

Brian Schwartz

comments reason can follow-up Thank I a that balance the any And the the stuff to either I if the question look you've the any there here tech. in color beat saying ed for that But your are in And all if you're had, growth Justin since the to the XX sounds kind those of quarter, business on is, can guidance he one the sheet, general commentary XQ the that much XXXX had. alluding because backlog. the on growth quarter of then starts there's wondering trailing earlier, if and make really off at we was at you. at from beat mixed that revenue that you was kind the that lower early billings bookings was in deferred and on of had then backlog asked of on see it wanted in that a numbers, just in it's looking thought lowest guys you good. the it kind you

commentary business, share today? can of bookings Thanks. stuff some the overall positive because the or So on that commentary see backlog, don't on your I sounds you the the any we maybe very think

Steven Kaminsky

Yes.

short the answer really. is not So

couple starts, have of and We which quarter. is other have early which a non-recurring, did performance did then drive outsized components not is can beats. one we One of that occur, the

X%. and a than XX%, was little last was quarter it was quarter, fact, what lower it bit In last this quarter

and feel comfortable again, that's year a the been the XX% the non-recurring, had quarter, doing. have a where of We're could or so is beat And XX% catch then catch we lot how last with quarter been it as the so very it's K-XX that with for business very we can, and happy arguably and that had larger. results and this

commentary prospects right. the favorable is about commentary way I think that especially more talk and is when about the of the the Bridge, it's you about range would long - Instructure in think I

that of more XXXX deeply this kind to are We XXXX XXXX we products starting and and one see move forward of we selling expect in deals, much client, the see into traction as the more multiple combo market. to penetrate and

So would about that's we as results. way what much it, the probably was current I provide think hearing you're probably that's if about detail quarter as and I regarding hearing can

Josh Coates

months. product months tailwinds I I or long-term generally of to respect privy just we're and We're Yes, the anticipate just and that aren't things to you six XX XX the - to think we guess of are business. the open out the optimistic guys the pipeline with position sometimes those in development or know course you

commentary. that think years out and got in - sit do we to at build to I are things working But yes, company, strategy well. your your so numbers. back of across in strategy we three the when But you and guys overall the comes And five the models look

Some ourselves. about things But slower following little it's generally pretty than so ahead we're working things speaking are working the a of plan a and we're like happy things. we'd are some and little

Brian Schwartz

Thank you very much.

Josh Coates

Thanks Brian.

Operator

Jaluria A. Davidson. to next D. go We'll with Rishi

Unidentified Analyst

you it to about you'll the when could for Hi, you expanding guys. was And Gauge? help, the contribute have Rishi. you product with will you Hannah the This planned is think when meaningfully timeline I talk maybe international be for and wondering on into market revenue?

Josh Coates

that for Gauge domestic, may a on opportunistic have Gauge. Gauge done good hit fit needs with for near really be think… we'll plans take in so XXX% start when deals be is In domestic like to up, the so so be hit, few we we've had of with Gauge. any internationally Yes, something Gauge, steps going good. K-XX market, feel And to stride we that to not International a hit but still that we've it future. the have have have really additional domestically, to with I be our features far And able most there's might but to internationally. opportunities work come There some we

Steven Kaminsky

going that it point… Yes, to is be the the was we a take, domestic market International another mean and analog but have for testing product I step understanding to Josh's really design will for

Josh Coates

there. Yes, get we will

Steven Kaminsky

thing first is first. But

Josh Coates

Yes.

Unidentified Analyst

Okay. education product? the Perfect. if differ between targeting wondering speaking, versus generally any there currently regions you're how the and more I just they specific a are corporate follow-up, And just then

Steven Kaminsky

about really, we've so this. Northeast nationally. our how products, this - Southwest like mean we roll not out instead in are been for about pretty We I start we open Obviously and focused We're out sell things market, and all on let's the of it U.S. pretty judicious with. internationally. to roll the the of we don't

is English-speaking our we're campus an Iberia, market. region. them available then as and the did a one of into newer The example. just to slowly out And with to roll of first a based more then likely with is speaking effort with we Spain on as lot push start Canvas we we some non-English doing tactics out regions, will new countries where countries, the Bridge,

process, international how thoughtful pretty about time that's a offline it. but probably it's generally should talking you about, expansion, you where think more spend So to approach we we how

Unidentified Analyst

Okay, for quarter. perfect. Thanks congrats taking my question, the and on

Josh Coates

Thanks.

Operator

would additional over time, Josh to any the hand for or I remarks. closing call this At back like Coates to

Josh Coates

for their talk in listeners that you XXXX. call guys and Thanks. home Well, called we next concludes QX of appreciate our those earnings We and questions, the to All at that quarter. with right. will

Operator

participation. conclude does today's That thank for you We your conference.

Instructure (INST) 31 Jul 182018 Q2 Earnings call transcript