BASE - Earnings call 3 2024

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Operator

Greetings, and welcome to the Couchbase Third Quarter Fiscal 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. Edward Parker, Head of Investor Relations. Thank you, Mr. begin. may you Parker,

Edward Parker

welcome Third and Call. XXXX to afternoon, Quarter Couchbase's Earnings Good

performance are: and guidance future subject by capabilities, as will announced Greg undertake which market not representing statements date, should nature market after me results discussing Henry. their strategies, closed trends risks relied our for reflect and concerning subsequent from expected Chair, to periods. our materially our With that and We future and contain uncertainties that statements the and business include issued do Today's in as call of be financial not forward-looking and actual Matt any address and These CEO, matters views Cain; condition could duty upon press our statements our any will we release financial cause today. financial and expectations. product views to Couchbase's at CFO, today business update President results differ statements, size, are only the and statements.Forward-looking be to these and

are which me metrics Relations on comparable metrics available financial Investor call as financial included the website.With most discussion with on well XX-K, refer discussed and also material filed to accordance to measures accounting Matt. XX-Q the to the prepared our in these over we press today's certain report SEC.During risks our that, call, and and factors that our other directly we of will report earnings is these discuss could A results, generally affect accepted GAAP the a other define For financial let in releases, in release how on measures Form press of turn please recent not are important which principles. the annual our our actual risks quarterly measures, most Form with reconciliation the non-GAAP non-GAAP as

Matthew Cain

include will fiscal guidance. once provide highlights strong QX and guidance details report very all big consumption, On key mix and sales well line our had business good key with fourth year is to call few operating of momentum marketing quarter off our non-GAAP Thank of all loss $X and business Non-GAAP across these efficiency XX contributing in top across I the the currency operating our operating at and this annual again and metrics. financial and results pace range. new points our well believe our top $XXX.X to remains continues was ARR, non-GAAP as discipline.I'd the excellent start new today's our as continued on which demonstrates growth, materially strong quarter Capella million our revenue, operational XX% expense afternoon, above guidance retention. increase experience efficiency leverage activity, million, execute and our demonstrate as results model. I'm growth on expansions, with increasing outperforming XXXX and quarter, to sequentially. up the XX.X%. more midpoint like across gross as X% This and call, third I'll healthy or teams everyone. company.We performance a our we net fronts.Total customer drive year-over-year our line XX% $XX.X increasing in up QX percentage up was constant all XX% Revenue results. continued margin that full our was up Highlights focus you, margin deliver was to strong pleased up of from X% to growing overall our recurring I momentum sequentially.Our of deal Capella, accelerate Greg best-in-class Capella, implied and continue logos across out a and priorities, of million, our Edward, year-over-year, across and quarter in

we're be than our customers. net their and of customers base In Capella with of customers revenue instances fact, strong to acquisition, contracts Capella more, continues customers robust multiple services important seeing saw now Capella platform's and the to meaningfully customer to ease our engine are especially as which we for an rapid XX and contributed QX, of in outperformance. and both quarters ARR X/X new of than to and electing more across our new the integrated board doubling and logo initial to our performance added consuming and scale, grow, first value.In base year driving in QX, to favorable use consumption along of the existing the dynamics emerge more added ahead of set quarter-over-quarter consumption Capella buy continues contributing we realize new and unique second combined.As we time

am in sustain confident to ability gratifying in While made growth.Turning as to our cloud we see early in we're innovation. innings still the I our would. our ever durable journey, they bearing of investments it's the fruit, as expected to long-term we database

for our to perform, We further to vibrant X-part but applications. single integrates not analytical like platform continue only all talked modern advanced cloud Recall enable it capabilities, multi-model with ecosystem.From context-aware and in about rich most seamlessly real-time for users. AI: search optimize services operational vision the and end our as invest architecture Combining drive inception, eventing, these enhancements applications. AI full to has indexing, experiences text applications apps a adaptive hyper-personalized We anywhere; solution. and and built to platform do that our been for the as provide demanding last of AI-powered refer more that value capacities a database processing; a our enable Couchbase developer partner in we productivity; extend quarter,

language the processing workloads costs, it announced data a integration suited columnar that harness on substantial significant analytics gap a operational brings enhances developer into platform. we single to customers complexity directly with is capability technical easier and is value the Capella, massive quarter.Capella adaptive real long-standing and the our believe to performance converges for scalability ability AWS, applications will last customers. barrier last Capella between anywhere achievement productivity. AWS data Service week, the significantly in from analytic perfectly analytics into Capella Columnar built-in a development teams while requirements and is a Capella this to their require.At required re:Invent include applications.As platform heart reducing natural which to the store which increasing new also real-time the Columnar making for and real-time of build Our The of processing is At Columnar developer introduction further applications. new real-time result, service announced business that and all Capella into we adaptive feature into time, a our co-pilot analytic can we adaptive ingest to IQ, a operational

continued customer in to Pacific. database system This capability a services application to for near-term I'd that delivered the quarter suitability pricing the was high managed me saving games this mobile million orchestrations, business support and services. as AI-powered Capella service our operational This because quarter adaptive customer mobile the maintaining database this power performance financial with design customer decisions. Capella service this publishers, enterprise Asia is case, as wins. Capella informed Couchbase This application customer was and customer game more enabling customers. services this the and migrated to customer few government, turn example subsidiary because customers database engagement of UStar top continues selected the company. self-managed customer platform reduce a to the grows.Initially than and with compelling to thoughts manage Capella additional products trading wins of for associated costs singular a new This scale.Another quarter investors customer to One a financial on time provider. see for game superior Couchbase performance.Now, requirements the initially this in subscribers. expansion architecture of customer platform.Now X originally real-time maintenance selected applications a of Games and of database scalability from its environment. a customer made customer Couchbase Capella to to in catalog. on decision new for its to benefits.Switching Capella. and intelligence we analyze deploy, its new our to carrier performance this price-performance.We to developers the how It in investment cloud-to-edge across its databases' leading In a customer unique invest real-time availability.Another for superior analyze for database-as-a-service This leverage with data expand customer it Edition, an multinational operational costs let and more and quarter our most global to trends, customer its of for maintenance of also further priority to for saw A its low-cost, cloud and traders offers eliminating and expanding analytics of the mobile manage, â€“ new high-quality the all organize high-tech, selected because impressive services to new Capella on demand including rapid market a thousands billing price-performance, selected in Capella's and communication our landed order and platform impressive ] to provider its services. top Importantly, Canadian needed fulfillment is selected This quarter Community beginning streamline from like its high-availability was with corporation. came one hospitality Couchbase the This while has application perfect [ leverages to customer enterprise in provide make American strategic support this many continue workloads, management, stability industries, wins. capture from to Capella database growth new we QX, an superior the We service

deal discussed buy our These for persisted electing headwinds. spending, with uncertainty continues and we to we've trends see approval said, customers again in execution all increments. very to pleased throughout the As smaller IT against elongated continue these macro layers to and I'm headwinds cycles, extra scrutiny of quarter.That and present the year,

these to invest where and digital We And macroenvironment, both playing to database play role we're seeing value, journeys.While to not faster demand only despite trends desire opportunities the cloud Capella. to and of company. we're a strengths platform, a with challenging start for would initiatives consumption for lower are strengthening for backdrop, additional continue we transformation as time of scale a continue prefer opportunities achieve growing we our pipeline our long-term as in a enabling strategic us increasingly in stronger a to organizations which also TCO see but creating healthy

Greg our first for experience, executive of we're closing, moment, remain initiatives, fiscal making progress XX. me drive efficiency company, against of how on and excited We're reimagining share has City Wednesday, details at want to you true that database delivering and and our today one Capella dedicated me that our for ones demonstrate key we accelerate how Analyst to driven our Couchbase dive model.Finally, and the strategy, emphasize in Greg? the that, the that's December are leverage outcomes.With New across our Couchbase XXXX, delivering to customer it navigating focus of we on the the think in further efficiency analysts line times ever results and I through At built often and always our the been next more team I as many commitment nimble say we're model.Before focusing our in on Day technology deeper Capella, we over do, heard values, the You've before. priorities to We marketing this on areas sales to our drive to the the I've walk pace we're been.In I'll cannot. into over investors and of financial our in this York as growth, foundation I hard on committed on Greg, of call to call mix problems can as and and Couchbase, join and hand core want top increase business call are rest invite the handing attack has I repeated control detail. by to to to

Gregory Henry

fourth and the ARR our quarter stronger-than-expected delivering Despite Without Thanks, key across value that our increase for $X.X us. mentioned, Matt, million Matt had million, incremental detail $X.X pleased sequentially. would and everyone, $XX of to representing currency guidance revenue, with fiscal more year-over-year we metrics. sequentially. third year-over-year in was to quarter a third operating scrutiny following outsized offset the was through or X% for X% experienced growth Professional have $XX.X sequentially, partially or million and basis end XX% revenue midpoint another growth Revenue declines million higher by level ability with the for I'll Capella $X.X are in enterprise our quarter outperformance of year-over-year expectations thanks, of execution, for our quarter walk the and annual the elevated and our XX% for in was as our in in our of an beat navigate customers recurring decline year-over-year an the a approximately quarter We quarter guidance. the joining growth was the range.Revenue our above guidance driving in and QX, loss XX% and third environment, XX% while constant our revenue on all full you quarter, XXXX. our been XX% business, deal and before very benefited X% of we sequentially. professional strong the headwind services services Total in at strength our $XXX.X strength currency consistent ARR, professional services.Subscription now year-over-year of the strong to XX% million, providing or million, dedication of third from increase year. consumption guidance third

and We in the up continue per below with indicative revenue as of fiscal to customer historical wallet quarter, levels.Our XX% customers. expect $XXX,XXX, from a up of third performance the $XXX,XXX was year-over-year have share percentage second XXXX in we growing in be quarter the large to contribution ARR

base Capella or renewal net activity NRR, we expect could dollar-based XXX%, strong as growth revenue upsell to to reminder, per ARR driven or retention customers. and enterprise decline continues a grow our larger As continues future in contribution, by customer exceed across moderate quarters.Our rate, of in

remained completion second XX% margin and enterprise XX% some We to Capella NRR in QX Capella gross of mix. to logo investment, and offset from strength from to over discussing our the otherwise reliably on and and new gross a of quarter, the of customer mentioned, the ability margin represented logos, share QX, metrics and in has please sustained challenging strong the growth Our a This margin gross and against to count more by XX.X% income as basis.In ago evidenced the consistent compares operations new from retention remainder profit again a once new benefiting expenses, to QX. We're a Capella. Capella logo the XXX statement, quarter, growing amortization by the spending with improving, our by that confident by initial XX.X%, the second of of quarter.As customers, year grew net thanks quarter. environment.In logos strong strength expand from over XX% last encouraged count note customers our our up from our exited of unless non-GAAP are the increase stated, the at all Capella we XX been an references our results our steadily our pipeline ARR remain quarter of of majority Matt in

As margin a as time.Turning increases, decline gross expect reminder, to will mix we Capella expenses. over

efficiency We us, invest but the to continue opportunity in are improving the to on see growth. focused our capture of front of we generational

revenue expense our in discipline pleased sales year revenue front operating million or or a revenue expenses us with from for XX% million were or and a QX million were XX% $XX.X this our year development of our expenses outlook.Our execution and to as of to XX% our and $XX.X Research or $XX.X saving ago. We loss initiatives $XX XX% cost marketing QX of resulted million benefits compared are outperforming on revenue ago. early of again for compared

cash operating was an or QX our loss as-a-service guidance year million common We $X.X well per the percentage $X.XX for year revenue $X continue negative for Non-GAAP as our net or balance the $X.X and long-term operating ago. bolster We to $XXX.X of to XX% XX stockholders cash to platform.General $X.X or a revenue compared than was of margin, to margin our now or to QX midpoint points thoughtfully with negative million higher and cash, share.I'll a million operating XX% million additional offering statement. negative ago.Non-GAAP equivalents sheet of QX short-term operating remain loss flow our expenses investments. turn attributable XX% or million loss well $X.X a capitalized were and ended QX of against as in growth strategy. to compared invest in million features administrative We for to XX% total execute

at performance an X% remaining increase million obligations, or QX, Our of $XXX.X of year-over-year. end RPO, totaled the

expect approximately free $XXX.X for next $XX.X year-over-year flow months, XX% cash as of the X% We was negative margin. from revenue flow and XX% flow million QX million $XX.X cash cash to RPO growth.Operating represents million over negative recognize negative or which total XX free was

We committed are progress profile fiscal I the our provide year free and further to we have QX with will and in remain driving flow XXXX. for cash made pleased the improvement.Now, full guidance

monitor discussed, ecosystem said, mindful solid in pipeline that we will investments momentum.That product we to go-to-market their our our momentum continue to continue business. we see macro remain of anticipate motion headwinds continue complement strong. and our Matt and As our impact the Furthermore, partner and capabilities, our on to remains carefully

midpoint. we fiscal range these total lack or as-a-service macro revenue degree account As of to at the of such, year-over-year conservatism our million the million $XX.X emerging the as offering.For consumption for impact trends to in outlook into the a of as quarter visibility of expect $XX.X fourth may XX% XXXX, metrics for how growth of uncertainty maintains the all across a of well consistent

outlook ARR range guidance QX of quarter which million note to the to due $XXX our an our incremental in at anticipate $XXX.X currency prior midpoint.We call. $XXX.X We to million, foreign represents the on XX% fluctuations, $XXX ARR growth at and This call that to last X% provided of or since are growth the headwind guidance growth year-over-year million fourth QX incorporates now midpoint. year-over-year compares XX% our raising million our

loss We our turning million of expect to revised million.Now a year full $X.X negative the to non-GAAP in guidance. range negative $X.X operating

the total our growth revenue $XXX.X range midpoint. full now raising million of year in or $XXX.X XX% million the are expect year-over-year full We guidance and at year revenue to of

anticipate loss or contribution million We, view due your XXXX therefore, implementation we a to services new a and as decreasing revenue than with enterprise take with the as migrated timing outlook electing a in budgetary we attach As continue services recent pressures along operating revenue respect the indicator be business. Capella.Furthermore, deals, Matt to happy customers of our Capella as well fewer to which ARR services impacts our as reminder, the range in with below to levels And are from Operator? negative seen and loss to to I that, fiscal rate variability certain lower a better you've visibility, million.With continue now historically $XX.X revenue strength of to our a result finally, negative of questions. naturally of customers. of non-GAAP operating expect are $XX.X macro-related

Operator

of Instructions] the question [Operator comes first with Our Rob line from Baird. Oliver

Robert Oliver

connection. spotty for Sorry

Matthew Cain

Rob. clear, and Loud

Robert Oliver

then, Matt, I one Capella, had and for Greg, for you. on I had a couple you

would those. in like surprised -- win with momentum, have to go better you've be So considering And talk mentioned expect a and new competitive you And context the it Greg. customers I there a of are customers winning you're about expectations? seen -- of it you? that nicely. that curve? rates for we getting know some then that to are Are Is that first process how happens So there, just those current customers, use follow-up is couple there, how of like does cases maybe more kind are and adoption your seeing that things with had Matt, Capella, have then risen database-as-a-service, a like guys than just usage a But And Couchbase get line you curious terms nice that what in on sounds when you? patterns I'd bid?

Matthew Cain

Sure.

take one these a time. me So at let

pertains because of time Couchbase them support on is think, we're And customers, have, it their is I dynamic to offer estate additional Couchbase, as they've workloads to they chosen proposition, open capabilities. value focus to new have one existing value we TCO, do dynamics Capella to Rob, workloads now to with seeing that where, faster workloads oftentimes into decisions you because our Capella value, platform able that more which is database-as-a-service going already leading use that expansion. and what people we've easier because actually mature with on migrate Capella them healthy the expand going is bid. to that Capella, you competitive of incremental are that well, that traction, to or proposition.The made estate, cases, their is don't has the right we're It's moving a of value entire on time previously a delivered. proposition up rarely, our other are ever, that's to competitive vendors saying, to finding of don't the subset Very decisions that for if reevaluating we're

And and what we're that of lot drives customers maintain try for is do time spend beyond that's careful going talking and which migration cases. there. activity types it's really use very ] new expand At that cases, seeing about what us. not shorter to we we're to both in is really our that again, sales we to usage, very workloads the to that, it comes want ability at customers one use new consumption relevance cycles, rate to a usage so, balances those developer time, with they [ more the same to healthy path push and the value seeing are, to the arbitrarily Board, not just of we're fact, across with to in land good additional manage relationships.When both about those healthy, time persona they as the with of

Gregory Henry

that as is top on the dynamic [ a outperformance particularly Matt That's what could some I just the of drove consumption line about. for -- add. revenue if on Rob, of talked Yes. ] part

Robert Oliver

for follow-up And then, one just Greg, you.

been you've to clear sort Capella. -- Just Obviously, margin [ ] of here ramping is from the good as comes that nicely. to about natural very have problem headwind gross Capella a

we levers to there that, our be out in to about it here, your could guide number margin, that model [ and about be not offsetting to that? there to to ] factors levers look As not you but are things as think -- getting FY are we trying we offset or about get 'XX, think that should thinking gross

Gregory Henry

Yes.

dynamic -- did then And developed is, we the margin have, of now think have I and Capella going of we diluted at why had performance because as development, in quarter see some just level there. as some done. will it for the the total level, rate effectively off will back and That rate more really a said, books, strong several we years other we perspective. fixed it's this internally that the get a you software cost launch margin that's mature Capella, more we be more improve Capella there's scale from the

So that's We seeing gross to more and improve getting the today. why quarter, but bit little you it dilute this keep Capella margin over it'll just time. got rate more we're will volume, see a

Operator

line question comes Stanley. Singh Morgan Sanjit next of the Our from with

Sanjit Singh

you I to of the the guess, this quarter, I workloads give results Capella that of you starting the not Capella particularly a workload Capella types ARR question terms nice is, may how sense other can enterprise? in have Capella, Really is and gotten again those workloads of that these you addressing guys on Matt, us nature before see side. of onboard with are had on the to to

Matthew Cain

we going Sanjit, of is would, logo value Couchbase delivering lower platform. the the and to is barrier into So, which that expected pace first on acquisition new certainly all, it is Capella entry of the proposition up,

and As many -- very field I of everything level to know have variety our Customer you capabilities allows use different many, inventory management, cases. in us from and wide serve a XXX verticals use cases, know, across of platform the we to

benefiting something extensive. of less for across faster a a had we move weren't where the really we're types out, as partnerships we've or cases, overall, starting Again, We're then because, particular part multinational from up. see been initial the signing with that's some to and have net that also presence about come not that's again, is about, a customers, seeing different able applications we to go of may not new frankly, but and healthy. variables, the but expansion.I existing from able we're acquiring. all seeing very to developers is run to, cycles, of that built pace direct expectations is customer may much really line of to we've we cloud begin And trial to where we're with.So dynamic get more to to be high cases And In geographies able from quite that use business directly think just in into migrate talking these we shorten Capella we're sales so, Capella that. breadth and a the that accounts to today new and fruition. quite ability It's benefit of customers

Sanjit Singh

in I'm about next [indiscernible] the to week we're really That's going encouraging. Day. that hear more Investor sure

follow-up. Just as a

As as sure -- I'm a that's QX in case QX go the is quarter big and well. into we software, obviously, for and with everyone Couchbase

that Going into there? a given team challenging the is And out top renewal year? give size is any macro still how QX, the sales those in renewals, the you little us Greg, is the of last of on there way versus being sense you do this year of a terms base feel can of

Gregory Henry

a will QX. happen just actually renewals probably than depending several larger that on It And customers drive a get at saw the Obviously, last QX, happen could largest guidance And we the And pool biggest will could one slightly had that quarter The -- those now. in when --- Good question. is Yes, wider you timing. our that they on year. renewal QX, our is QX ever. happen have add and between coming be bit little looks of will very depending us. for healthy. big QX of what obviously -- But There's timing should amount be of like. a range in -- ones I QX QXs significant up time done It's would the

So QX. and There's to it's are exciting a to really that going deals quarter. a be to that's big going out drive couple big of do, really what's there

week. looking as we're we're it. So to more forward looking to forward next we said, sharing And

Matthew Cain

demonstrated go-to-market Sanjit, gets And you're talked and with in I the leverage just just the some have just deals, confident quarter. operational excellent managing pipeline, asking that at economic efficiency we financial really not in on. We follow driving [ position, how value, big core about with functions Never inclusive our if could that across ]. right the That's very but across of things are understanding linearity the the to with the it understanding where about. we I teams, of the company, been results, the performance the more

big the will there think operational So are and place, have job to teams are deliver. continue they for I a rigor big and to dynamics. great testament a quarter, in doing but deal It's the they

Operator

Our Ittai next Kidron Oppenheimer. comes question of from with line the

Ittai Kidron

Capella percent been an your why good revenue you guys, Greg, business? a that that is me. your the given have it's single-digit it great in for remind I a still. not low it's work flattish and indicator Nice X for of too quarter. of can a mean, quarters us row, RPO, for on A couple on much impact cannot

the between again revenue? disconnect RPO and understand, So help remind us us

Gregory Henry

typically, would renewals. the for it on on tell to back Sanjit, and comments of good I customers RPO, made do renewal. our Yes, I goes it's you, up And largest just coming several just they have multiyear we question. a Look, the

deal, to it's you're that, of So a get putting at by if renewal much the it's there's about if multiyear into And not all the the you -- time end you RPO. left. point, that think

And -- so, stays see stays particularly improvement I seeing why revenue coming is of because the It it of obviously, deals, whereas which consistent relatively in some some an time. QX those large variability think of timing, the you'll RPO you're out over in grows.

of QX. RPO but -- in X deals only the running, of the is there's are -- will. these left if So backlog, some that full you renewing revenue in revenue that quarter There's of value

Ittai Kidron

Greg? these Are multiyear deals,

Gregory Henry

deals. typically at Yes. least X-year deals, if are These large not X, deals multiyear

Ittai Kidron

And understand that can has it you on gross the is XX%? -- still improved Capella Meaning, then level? on specifically? maybe I on gross comment already of below Capella, the there. margin comments above But Or specifically margin, Capella

Gregory Henry

margin I Yes. particular, growth saw about tell very talked and and about what we gross a doing the quarter the and that in rate. thought we haven't business improving that terms exactly margin. uptick and this we it's the in you Ittai, of spoken obviously it has been the can steadily of healthy just

improving. is got like I comparison onetime it so, said, adjustment. we And that And

volume the So I more improve. get we feel where it's the margin to to is and there, rate about land. mentioning, was ultimately we And as will good on continue Capella where going only it

Ittai Kidron

with on customers Matt, the one Capella cases then are the on way for in compared bringing their joining adopting different use in what you're you, And customers itself. last their on-premise In are especially it, platform, new your that to the profile, platform? ones

Matthew Cain

less new their an are with the Couchbase, it's more that and things the app it's usability, had line.And serviced fruition. not I another price-performance platform but Swarm getting it's prepared breakthrough application company proposition logos if an of freed chain behalf service and the coming take the chose and AI, have couldn't before. I we health use literally of Capella That's had to resources through it's built about to that with solutions connectors we based would not and about those and that that adoption. with all get like time against of the developer deals pace you engineering, doing for were new comparisons until But use in ML logo, remarks. talked value. specific these and that incremental multinational over because to time We about checks Capella more were they customers, security migrations well, applications the we go it to managed if us into chose we on aligned at other new had up know ease value and were optimization their on that you We that of the did us inside of that the customers. that one supply verticals, platform, price-performance, We evaluating.Now, another we in think through certifies and a use the value we've case cases they company, proposition we Again, of have to cybersecurity the with all

have technology in and way We additional to are the all now want believe they and single consume platform, always capabilities, consumption, continue which very we services. Customers the we cloud-to-edge a broad-based to differentiated that.We're with our to platform. the those valued add marrying with it industry-leading up have

uplift, that's to place. ability the combination use new not we so at because hard it's cases to get capabilities have So in necessarily those worked that an providing

Operator

RBC line question from the Matt next of Markets. Our with Hedberg Capital comes

Matthew Hedberg

Matt, accelerating great see. well. as net to were the adds me from Congrats

think instance? QX on Anything guess with business, -- run I I'm new but Was about anything on talked this this in, the you adds? versus net be just a a I quarterly unique quarter's or adds? rate QX. -- for some know wondering even large wondering gave statistics half pull I you renewal for first in cohort, but new I kind could guess there of

Matthew Cain

highest by to We and ways Matt, Look, the we've the I And company, shows was think driven this adds pleased as with Capella. the area certainly improve, half an go. that was I to of will tell it adds results. still an had we was was said it gross and that it anomaly. quite we're that the that you, have ever transparently highest need we've a first gross

and been It's Now we've expected a partnership. we've the also go-to-market, focused Capella that on, rigor operational not the that, value on expanding it's our things just proposition. and

lines to lot basis. more we a improvement and of this and indicative to a bigger much what as that And I'd what say, area no have be there's drive we like think can delivering in will there's So focus the go-forward on water the I there, of, a company. is

Matthew Hedberg

be you provide your give should models year, margins or as well. our we're you are next maybe, as thinking about Analyst of you'd there on But sort ] 'XX. [ for that guideposts any growth And of Day, fiscal us [ margins this but topic Greg, a trying might also didn't obviously us we ] of commentary think us like on but any expand [ year? can philosophy growth, of But how to sort with next focus that about [indiscernible] ] known -- we've sort in sort on of guide

Gregory Henry

be obviously, Yes. a lot more, next Look, week. there'll

We get specific QX not be are fiscal giving to 'XX guidance earnings. our to until going we

about said, obviously we're from we're That mindful are are of will we long-term now, create income. we XX So it. cash efficient all the of think extremely model. view working of out to I days of some to some and you sort to again, more free leverage how through of our more op come And thinking we committed margin move provide improve this our to flow, but profitability, And way continuing to a that continue And get saw year. model, quarter profile profitability. just and

Operator

Our next line Blair. the of William from with question comes Jason Ader

Jason Ader

QXs, the if Just first it bit look sequentially at wanted I I you're QX. on for QX was giving little to X ask not Greg, but from last to a QX. you, down know guidance, specific --

into of puts QX remind the kind So as QX? on seasonality, us takes other and turns the and just then

Gregory Henry

course. as QX -- depending largest before, some year, on was the and Yes, typically is I [ is quarter the -- I'll give sort is of year, smallest the our you general year, alluding of our ] [ ] typically of of QX quarter

is the about. So I yet. seen think But not to seasonality historically guiding reasonable again, we're think you've

a or QX of fall I which deals change would mentioned, we've couple of large QX, sort that in As that could got dynamic.

sort because going we're just really are why to a if. out see that's that's They of wise. to with It's of to need not when, not guidance matter ready how going just to come we play timing So out happen.

again, QX is wise, our I robust. pool, big historically, -- nearly QX typically not but seasonality you've of just renewal not the think, to -- it's seen So as as

Jason Ader

you, Matt. then And for

You importance where I great sense company like -- know, be is features try they on Maybe talked don't deal. [indiscernible] might new introduces about this? about cases a get just talks Just how about to this the this the big capability? a talk of it's important columnar But greater analytics some and Every are. use feature. how used? just

Matthew Cain

this adaptive, figure business to order real-time to data databases Mongo, focused performing.There's that the to is operational exists [ adaptive significant. not to to that solve in wall ingesting data SLA injecting analyzing truly company trying you of a this data our Yes gap, closer data operational think in we've future, it's -- other with not And application vast furthermore, and only the reducing around underlying combining done across to and from to in to taking operational strategy. the performance do but in in enable from get and not What ETL, these use Jason, and as that, customers appreciate then level, FX about the not with how trying this are store, to applications by is of that's much those every modern between into architecture JSON, you real-time start relational as data underlying and insights data latency look that I And And this -- enterprise have your develop but the another application the thinking what do data. world all we need as our analytics our eliminating their basis majority applications efficiency these their is XX alongside data the on significant like the capabilities into require. it's the data that to analyzed.And their at out question. the We operational the manage quite on we people technology disposal, gap in you're just store. ], have developer real-time that their are make the feed sources, to existed architecture analytical can improve sources the with years and directly maintain for customers.And platform natively is capability while next we world, a

the is on a strategies. single scale that core developed and ever is been cloud-to-edge being in the this capabilities map, layer we've but layer, and with to the we obviously, quite platform the think we application to quite our applications big have phenomenal when road density step us. to -- that data aligning these our will requirements in their we've think and for the so, of performance, coming we and application platform advantage, about frankly, together pretty and analytical.And that vector which overall customers capabilities in operational, like all importance think from talked relevant, about supporting we're the are add digital quite never our and of we getting, these for architecture, And an data about of transformation that that understand this world excited AI-driven and that feedback more So a it about

Jason Ader

examples us give you can some technology? columnar And use cases of for analytics the

Matthew Cain

Yes.

about, taking to So, applications this level. like mean, the is next I

So, I'll generic few give a ones. you

down What on you're was map of you're based local doing remodel something if but portion your and particular another it these in at level. on next the you an a from to I'm bring to the one now that at that and level those recommendation aware what's store into get the matched with with my in of that structured, Let's completely a world we store. or was that meets but I needs my the inventory a has my pod awareness know going beer cetera. type user.Streaming miss real-time you're a information performance, in favorite that starting get when to et and teams you improvement without remodel, the what home slowing possible can then your of input, home -- e-commerce These is now alert store what's like in product if take buying fridge something taking and that delivering us, for the all home because as and recommend it's I to well, say, services recommends what game, unstructured, the shows you're home often applications changing an recommended access the you But and happening your a to you? happening adaptive happens of product. real-time shopping it is life?If personalized analytics in are what descriptions a in product happening are That's that that it, personalized temperature what descriptions not it all of applications application that if connected every feed of

Operator

question of Brad comes Stifel. line next from Our Reback the with

Brad Reback

to what engine? be in for Matt, anything volume if it needs to Capella customer acquisition order true a at change

Matthew Cain

Brad, idea I next that excited point. a going to think we're week. heading the this talk that We're lot direction. is We're about spend to time Capella inflection at

think -- sophisticated the go-to-market integration how IQ have, we And to I partnerships. to thinking to investing we're the marketing, how how growth. go-to-market we're marrying with solution, point about I more is highly our the we're we're in going think and product-led enterprise of that now like the opportunity benefit where that we have usability, resources, give from up things augment motion the we're product us the

think And going we're stick inflection that at see of we're that so, where do start coming. to hockey the to point I

Operator

comes from line Koujalgi question Taz of next Our with the Securities. Wedbush

Imtiaz Koujalgi

first a I have Capella, on one. question

of new values on same logo enterprise these positive [ smaller, logo driven or very on comparing enterprise the level you're deal are ]? sizes of new deals deal like So Can the comment Capella Capella. adds these new these by the at you traction the Are to deals?

Gregory Henry

than value see the on again, to rate the business. time week the going smaller new what in is and growth Thanks substantial the certainly side the the enterprise to -- again, the next lot on about for is, would business. that compared enterprise the this we're Yes, logos But are question. a to talk Capella of -- we

they grow the always So assume -- would Capella but the smaller, we start that they be nature and can model. faster that of

the Now they're enterprise times general, in are ones, get larger where that we said, business. the than there but smaller of part

Matthew Cain

to incentives customers started. actually and And want Taz, we're building and we that, programs get

are and the the the of to exact commit that logos in have that [ and find applications landing with to, trying new is credits us friction then that they ] sizing model. customers going to business pure enterprise knowing because or picking points One we friction are going can go we consumption a people that with Capella, entirely, remove and add just With people dynamic we're a get can platform.

value anticipate any So ] say that expect of that. -- And not it spend to to efficiency more It's and getting potential expected if just or continues as would anything, of I is That's them we down the volume. going. smaller. landing they're them we add come [

Imtiaz Koujalgi

this your And call peers seeing to that. faster keep [ seeing use basis, about that mentioned think earnings that this ] I customers, to I but -- commitments you're reason consume they're their credits. make on on who consume their buy unused. salespeople faster? night And changing or go-to-market you're to, more was you changes guess, them commitment the [ to you is, faster their, guess, I'm quarter to had the I spoke that, sell mean that credits last that model, so some go-to-market just capitalize ] don't a credit The drive ahead or of not then quarter guess, on one I people basis the follow-up how Matt, in incentivizing done asking and of I a consumption customers consumption the

customers that faster? changed your consume go-to-market make guess, anything side I So to, has on

Matthew Cain

on in understanding where a and incentives this and of services, that, last and big than it Certainly, the Look, that we salespeople, adjust part ] be fiscal that Yes. consumption. be don't to course issue. and think in customer SE the quarters, customer consumption, we operational of where so need quota-carrying is prepared relationship be May providing want X may aligning talk very circumstances but being if I we've [ from getting they we [ people up everything with that engine, the harder with if matured them [ we deployments below need rare success resources, to surprising, go-to-market our are anticipated. throughout they professional customers were ] to to them ] that consuming of customer needs end help running aware of be year, about capabilities dramatically ahead a over certainly would managing

put complexity and customers, place of part to important into business I process pretty strategies forward we're in think complicated tools, people.Consumption there Couchbase want leaning have in and we as systems, rigor we've manage investment helping right the operational of that variable. that the level that can we an to that. manage. the in go good subsequent to and But be are the with about feel So operational we're of make them -- incentives, we're business and for a sure Getting and we which certainly their making sure consumption Capella is that me satisfying big that and

Imtiaz Koujalgi

if follow-up, one I just So may.

the of Capella, quarter, number I number logos the Capella new add new guess added adds, I we think you're at for a had new higher when last of that. saying logo overall and look logos

you that's higher. the benefit enterprise from migrations of think Capella I the got number and Capella was to workloads why of

little was lighter this versus think logos same. I activity the quarter and quarter? This a quarter, the Is fair assume enterprise to to it migration new that the last are -- Capella logos almost new Capella that is from

Matthew Cain

No.

net I something over quarter-over-quarter can migrations. I it number getting a was the think the logos. again, X/X there. growth. the be might customer our lost takeaway of we're mentioned majority mean, about of of in Greg healthy But base. saw we We talk Capella

think I is that all of up quarter-over-quarter.

specifics. the have You

Gregory Henry

the Capella Yes. I whereas than it mean by grew by this count quarter last XX%. quarter, XX%, grew customer more

inclusive that's the accelerating both we're So and logos. customer adds, new of migrations both -- of pace Capella

good we very So about feel it.

Operator

from line of next the Our Howard question Securities. Guggenheim with comes Ma

Howard Ma

of for in efficiency migrations Capella, new we efforts to when about And I sales Taz's of deal off that's logos? last Great where the sales levers just dovetail on force for market question, guess acquiring ] versus think terms quarter, guys. the and me. it is [ focused

Matthew Cain

Look, to bring. care jobs taking be as our do platform accounts existing salespeople over we of that because those new new applications applications, growing appropriately I to here. balanced obsessing That's -- the We customers. and existing then our adding need think customers, we're net of

and given appreciate model a can a more rep little account. we You have on focus existing fairly may have go-to-market that an any mature

look on collective focused not resources field over if by the there's of a that not we out moment entirely both. at that army the we're obsessing almost there, are at goes company that new. reps But have We

exclusively that's and of I new talk medium region do the new focus think our time think we logos, new we ability to but one apps we Capella about applications, a is, new about I both balance. that down about things are not fantastic only striking in win the we're the ensure reps lot a logos on better rigor to I Board given been.We our -- accounts or lot and we long-term time achieve appropriate our spent the balance. spent existing has basis. thinking I or pretty plans and -- off, operational compensation and ever across of to we is than that need have it individual think adjustments if need we of to objectives, And any and on territory make to both.And in those real-time that a incentive

execution So, the in leaders this of again, proud to with testament dynamic navigating the I'm others. Board our along and field across pretty operational many

Operator

for this Thank CEO, floor the further Cain, at to to over comments. questions time, closing back are Chairman like no you. and There turn I'd Matt and

Matthew Cain

you. the to Thanks, Thank and very operator, best hard many make XXXX working us you can tell I all see next yet. joining forward hope you and seeing thanks sure in New and performing York is to are with year you look we're of to then. pleased fiscal I'm everyone to for business week how today. our

Operator

today's teleconference. This concludes

participation. you your lines Thank You your this disconnect time. may at for

Couchbase (BASE) 6 Dec 232024 Q3 Earnings call transcript