Q4 2019 Earnings Call
Good day and welcome to the talent fourth quarter 2019 earnings call.
Today's conference is being recorded.
At this time, it's my pleasure to turn the conference over to Lisa Laukkanen. Please go ahead ma'am.
Thank you. This is Lisa Laukkanen Investor relations for talent and I'm pleased to welcome you to talents fourth quarter in fiscal year 2019 conference call with me on the call today, Our challenge CEO, Chris Tovey mine and CFO out in my teacher during the course in today's presentations, our executives will make forward looking statements.
Within the meaning of the federal Securities laws.
Forward looking statements generally relate to future events or future financial or operating performance and involve known and unknown risks uncertainties and other factors that may cause our actual results performance or achievements to differ materially from that was contemplated by these forward looking statements.
Forward looking statements. In this presentation include but are not limited to statements related to our business and financial performance and expectations in guidance for future periods, our expectations regarding our strategic product initiatives and their related benefit.
And our expectations regarding the market our expectations and beliefs regarding these matters may not materialize and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those projected.
These risks include those set forth in the press release, we issued earlier today as well as though is more fully described in our filings with the Securities and Exchange Commission to forward looking statements. In this presentation are based on information available to us as of the date hereof, you should not rely on them as predictions of future events, and we disclaim any obligation to update.
Any forward looking statements, except as required by law, we note that other than revenue or otherwise specifically stated financial measures to be discussed on this call will be on a non-GAAP basis. The non-GAAP financial measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with gap.
We have provided a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measure in our press release.
Alan customers that are referenced by name today do not endorse any vendor product or service and you're not advice any company on selection or use of technology products services or vendors and now let me turn the call over to crystal being on Cowen CEO.
Thanks, Lisa welcome everyone to our call today and thank you for joining us I'm excited to be here today to share with you talents fourth quarter and fiscal year 2019 result, and offer some initial observations based on my first five weeks with talent, it's been an incredible and busy five weeks I've been focused on diving deeply.
We entered the business and getting to know the employees, who have all contributed to growing talent into the company. It is today, we're spending time with the team to understand the priorities and the opportunities and to drive success into the business. Our employees are at the heart of our business and central to our success and I've been impressed by the team and their conviction for cash.
Alan.
In my prior role as Chief revenue Officer at Sep Concur I was responsible for leading worldwide sales and I had the privilege of helping define expand and execute our routes to market in a cloud focused environment.
In doing so I've learned how critical it is for a company to continually a ball as the market shifts and specifically to cloud how critical it is to embrace a disciplined a scale and to provide sustainable growth.
I would concur grew to be a multibillion dollar company. It was on the back of cloud applications and similarly talent has the opportunity through cloud data integration.
Also the role of data became imperative to how companies build their systems and differentiate their products. That's why I'm excited about the opportunity to be here at talent.
And in front of us lives and amazing opportunity as someone moves to the cloud not only providing growth for our business, but it also allows us to meet our clients on their journey to the cloud.
I'll share more on my perspectives on the business and the market in a moment, but first let me provide some highlights from 2019 fourth quarter and here in the fourth quarter. We achieved record total revenue of 66.9 million up 20% year over year for the fiscal year, we achieved record total revenue of 248.
Million up 21% from 204.3 million in fiscal year 2018, we ended 2019 with annual recurring revenue of 243.1 million up 23% year over year.
As of today, we are introducing a new metric cloud air our I'm pleased to report cloudy or our totaled 53.9 million as of December 30, Onest 2019, and grew 179% year over year filed represented 50% as new air are for the fourth quarter achieving the goals.
Established in our Q3 2018 call.
We view cloud error or is the best way for our investors to understand the opportunity in progress of our company. It demonstrates our significant scale and successful shifts to the cloud. We now have over 2250 cloud customers and a total of 4250 customers.
The results of fourth quarter and here are a testament to the successful transition to the cloud and validation that cloud is the catalyst for talents next phase of growth. We're laser focused on ending 2020 with over 100 million in cloud air are nearly doubling our cloud air our by the end of 2020 by winning new account extending cloud.
Into the installed base and helping premise customers begin their cloud data journeys.
We set this goal to hold ourselves accountable and to provide a benchmark to our investors to help measure our progress as we now disclose wild air are on a quarterly basis. This is a tremendous value driver for the company and we will continue to prioritize scaling the rapidly growing cloud business and 2020 and beyond.
Talent is a recognized leader in data integration and data integrity and the company is that a critical juncture as it continues to scale if club business, how long does that an inflection point so what's the world's relationship with data data is at the center of every company strategy as a competitive advantage for companies to Reimagine.
Their own roles in solving problems.
Alan helps ensure all of our customers data is clean compliant and accessible across their organizations. So they can maximize its value as a competitive advantage and draw new deeper insights into their businesses as a firm believer in the importance of reliable data driving business outcomes I'm thrilled about the opportunities.
The scaled the business and extend how its leadership in cloud data integration and data integrity.
Build upon the company's foundation and pave the path to 1 billion in revenue we need to win in the cloud data market. We will continue to make progress on this journey with our focus on our go to market strategy that drives better effectiveness of our field teams and more efficiencies and the processes and systems, who enable scale and velocity.
I'd in our business.
These will be forced multiplier for our growing sales teams. The first step and bolstering. This growth strategy was the appointment of and Crystal Graham as our Chief revenue Officer.
As we deploy this strategy is critical that every decision we make is guided by a customer first mindset, Jamie Kaiser our chief customer officer will be instrumental enhancing the strong customer first culture that already exist here at Cowen.
Both of these skilled individuals have experience in leading multibillion dollar businesses building world class teams and they bring extensive cloud backgrounds to talent.
We've also enhanced our sales and marketing leadership in Europe by adding a new GM of EMEA and a new head of EMEA marketing.
We experienced headwinds in 2019, but we see the potential for our new leadership team to improve performance.
Additionally, we recently announced the appointment of and Hardy two newly created position of Chief Information Security Officer.
And will be instrumental in driving our security strategy and hurt addition to the team is critical as we continue to mature or cloud offering and grow our business across the globe.
We are building the right team with the right mindset in place to be billion dollar ready with the strength of our cloud business and the new leadership, we will move swiftly to implement enhancements and changes that build on a solid foundation enhancing our position in the market and prepare us for a strong future.
As an example, the steps we're taking to expand our routes to market, we announced in Q4 as the availability of Palin cloud in either the U.S. marketplace, along with achieving HW s. retail competency in Amazon redshift ready designation status. We also recently achieved HIPPA and data she'll compliance opening up additional.
Areas to win in the cloud.
With a focus on solving the most complex hybrid and multi cloud scenarios. We increasingly has focused our R&D and go to market resources on the cloud opportunity.
As expected in 2019, we saw slow down in our premise business. This part of our business continues to be stable from the retention perspective, and isn't important asset to us as we migrate customers to the cloud. We continue to believe a vast majority of our on premise customers will migrate to the cloud in coming years. So they can take full advantage of the cloud.
Across their business. It is early days on migrations, but we're encouraged by the opportunity for our customers to expand when moving to the club.
We see this is a tremendous vote of confidence in Palin as customers reaffirmed their partnership with us in the cloud we believe migration to tally cloud will be a natural step for our customers as they shift to new staff technologies and their data integration and data governance needs become increasingly complex.
Our customer growth was fueled by continued strength in telling cloud as well as the contribution from the frictionless motion brought from stitch as it facilitates talent winning customers of all sizes.
Which enables us to capture more market share and sets us up for scale with our growth as a continued part of our growth strategy moving forward.
Let me walk you through a few customer success stories or customer wins demonstrate a commitment to talent as companies continue their data journeys.
A significant Q4 win for talent was with a major U.S. based broadcasting and media organization. We won the business based on our into in cloud Native data suite approach with built in data quality governance and lineage and our ability to run seamlessly in a hybrid multi cloud environment.
This company will use talent to integrate data from multiple sources, including Vertica and Teradata as well as applications hosted on eight of U.S. and Google Cloud. This company is also turning to talent to enable the California consumer privacy, s. compliance and to establish better governance practices and organize data asked.
That's in a simple easy to digest format.
With data protection regulations, such a C.C.P.A. and GDPR on the rise across the globe, we see data governance and data privacy compliance as one area of opportunity for us to capture increasing share of the market.
We also saw continued momentum in APAC region in fourth quarter with new customers like Nissan Motor Company. We were selected because talent is the only platform that can help Nissan create a single view of its data in the cloud the auto manufacturer wants to create a vehicle threesixty.
Providing value to operators and analysts by integrating all sales production shipping inventory and maintenance data as Nissan vehicle. Additionally, the company expanded its footprint with talent within the quarter by adding data catalog capabilities. As a result, Nissan will build a vehicle cloud data warehouse that provides a single source of.
Bruce we're all data is consolidated and easily access bike and analyze customers needs market trends campaigns production management and logistics.
The next success story in EMEA is a great example of customer expanding the use of talent overtime over.
Over the last year, a major French utility company use talent to enrich migrate and create a unified CRM application from 18 separate instances the salesforce operating across the business. This action increased feel sufficiency and save the company money into for the company out his talents data governments capabilities to help you.
Users with a critical task of maintaining data quality within the new CRM applications.
It's an exciting time at talent and I'm thrilled to be here, we're already hard at work driving the next phase of growth and continued to capitalize on the market shifts to the cloud in the past few weeks, we've already identified many areas, where we can capitalize on as well as the opportunities to improve and mature in order to move at a faster clip and laid the.
Proper foundation for growth, we will be making strategic investments in the business. This year as we bolster our go to market strategy in order to improve sales efficiency and effectiveness.
The new leadership, we have on board will bring fresh ideas and valuable strategies to the company with any transition comes calculated risks and well some of the changes we're making will begin to show near term progress. We also know that building a sustainable growth engine will take time to bear fruit, we're taking the time to properly assess and implement choice.
Changes and therefore, we want to be prudent in our growth outlook for the year, we're prioritizing implementing the necessary changes to lay the foundation to scale for long term growth I look forward to give you an update on my initial findings. After my first 90 days in my role and an update on my key strategic initiatives for the company and our next earnings.
Call and now I will turn the call to Adam to review financials and provide outlook for the Q1 in fiscal year 2020.
Thank you Crystal today I'll review, our financial results for the fourth quarter in fiscal year 2019, as well as provide our outlook for the first quarter in fiscal year Twentytwenty.
Annual recurring revenue were error or grew to 243.1 million as of December 31st 2019 up 23% year over year on an actual in constant currency basis, we define error or as the annualized value of all active contracts at the ended the period.
I'll also remind everyone that Q4 was the first quarter, we're lapping the inclusion of stitch for year over year comparisons.
We're also excited to provide a cloud error or today, which represents all active cloud based subscription contracts. We ended the year with $53.9 million Vcloud air or this compares to 41.1 million as at the end of Q3, 2019, and 19.3 million at the end of 2018, representing 100 instead.
Only 9% year over year gross.
We've included a five quarter looked back of cloud error or in the presentation posted on the Investor relations portion of our website.
Cloud represented 50% of new era or for the fourth quarter achieving that goal. We set in November of 2018. This percent mix has been a key measure of our sales and marketing rotation to the cloud during this year.
Our measure of success for 2020 will be overall cloudy, our new cloud customers continued expansion within existing cloud customers and the cross sell to existing premise customers will each be meaningful contributors to growth.
We're pleased with the retention and continued expansion of existing customers for the quarter ending December 30, Onest 2000, a night team. Our dollar base net expansion rate was 113% in constant currency as discussed throughout last year. We expected. This to decrease one to two percentage points each quarter during 2019 as it full.
We reflected the transition to AOCI six of six.
We now have more than 4250 total customers over 2250 of which are in the cloud. We ended the quarter was 593 customers at 100000 or more of a our or compared to 540 in Q3 of 2019 enterprise customers represented 66% annualized Rick.
Current revenue in Q4 versus 65% in Q3 as discussed previously we believe is a or based measure is more accurate reflection of enterprise customer momentum using our previous revenue base methodology. We ended the quarter with 568 enterprise customers.
Total revenue for the fourth quarter was 66.9 billion up 20% year over year subscription revenue for the fourth quarter was 59.1 million up 22% year over year or 23% on a constant currency basis total revenue for the year was 248 million up 21% year over year.
Subscription revenue for the year was 217.2 million up 24% year over year. We're also pleased to report that we achieved the sixmillion revenue target for stitch that we provided in our announcement of the deal in November of 2018.
Professional services revenue was 7.8 million in the fourth quarter, an increase of 8% year over year professional services revenue for the year was 30.8 million an increase of 5% year over year, we've seen professional services slow as cloud sales have required a lower professional services attach compared to on premise sales.
Professional services are an enabler of customer success, and ultimately contribute to growing our subscription base.
As we've discussed in our last two calls we saw softening of demand in Europe, given the macroeconomic backdrop. There total revenue from our EMEA region grew 13% year over year in Q4, we continue to take a cautious outlook for EMEA for Twentytwenty.
Before moving to profit and loss items I'd like to point out that unless otherwise specified all expense and profitability metrics I will be discussing going forward our non-GAAP results.
Full reconciliation between GAAP and non-GAAP results can be found in our earnings press release issued today, which is posted on the Investor relations portion of our website.
Our total gross margin for the fourth quarter was 79% and total gross margin for 2019 was 78%.
Subscription gross margins for the quarter remained at 87% subscription gross margin for the year was 87% compared to 88% last year, we expect a modest further impacted gross margins and twentytwenty as we continue scaling their cloud operations.
Professional services gross margin was 21% this quarter up from 16% last quarter.
We're pleased with the margin performance of professional services, but this quarter was particularly strong giving type utilization.
Operating expenses for the fourth quarter was 54.4 million up 13% year over year operating expenses for the year were 211 dot 8 million up 22% year over year.
Sales and marketing expenses for the quarter were 33 million up 15% year over year, we slowed head count rose slightly in Q4, given the anticipated leadership additions and expect to compensate for that in Q1 in Q2.
Sales and marketing expenses for 2019 were 127 9 million up 20% year over year.
We incurred an operating loss for the quarter of 1.3 million were 2% compared to an operating loss of 4.8 million or 9% in the fourth quarter of 2018.
For fiscal year 2019, we incurred an operating loss of 19.5 million or 8% consistent with 2018.
Net loss for the quarter was 2.2 million compared to a net loss of 3.9 million in the prior year period.
Net loss for the year was 20.9 million compared to a net loss of 15.5 million in 2018.
Free cash flow for the quarter was 1.7 million compared to negative 6.7 million in the prior year period cash and cash equivalents ended at 177.1 million as of December 30, Onest 2019 up 5 million from last quarter.
Coming off of a strong Q4, we're more excited than ever about the cloud opportunity.
Our cloud era has reached significant scale and explosive growth, we expect to end twentytwenty with 100 million of cloud error, including roughly 15 million from cloud migration. This year fully rotating the business to the cloud is our most important strategic imperative and cloudy our our will be the best measure of our progress.
And success this year, we won't be updating this guidance through the year, but we will continue to report out our progress on a quarterly basis.
As we enter fiscal Twentytwenty, we're focused on laying the path to become a 1 billion dollar revenue business first as Christopher mentioned, we're doubling down on or customer first strategy and putting the right team in place to drive or go to market execution at scale.
We believe the appointment of Crystal and the other additions to the executive team as well as the recent hires in sales and marketing leadership in EMEA bring the right experience to lead the next phase of our growth journey.
Second we are focused on building a best in class cloud data integration and data integrity platform for our customers. This year, we will invest more in R&D to strengthen our cloud offering bring new products to market and enabled premise customers to seamlessly move to town cloud.
And finally, we intend to make additional investments in our operations and infrastructure to enable us to skill more efficiently.
With these investments we expect to consume 30 to 35 million a free cash flow in fiscal year Twentytwenty. This target is conservative on duration and includes a few I sleep it impacts, including approximately 3 million of interest expense related to our convertible notes and a few million of expenses in Q1 associated with the management transition and organization.
Total alignment.
We're confident that now is the right time to make these additional investments in our go to market strategy products and infrastructure to capitalize on the immense opportunity we see ahead of us.
As Crystal noted in her remarks. These initiatives will take some time to bear fruit our guidance reflects these expectations and the investments we intend to make Furthermore, our growth outlook incorporates our cautious view of EMEA for the year as well as the impact is continuing towards more ratable revenue in the cloud and lower overall professional services.
Specifically professional services resulted in a few points of drag on revenue growth for 29 team and we expect that trend to continue with 2% to 3% impacts to total revenue growth for Twentytwenty.
We expect professional services to decline sequentially in Q1 and be down to flat for the full year.
Given our strategic push to accelerate our transition to the cloud coupled with a macro and structural impacts described we are being prudent in our growth outlook for this year.
For providing guidance I'll summarize our key metric disclosure framework for Twentytwenty quarterly will provide both total and cloud EMR and year over year growth on an actual and constant currency basis for each.
Constant currency adjusted subscription revenue growth.
Enterprise customers on an EMR basis, and the associated contribution to total in our and our dollar base net expansion rate adjusted for constant currency.
I'll now turn to our outlook for Q1 and full year Twentytwenty.
As a reminder, our guidance assumes similar business conditions and foreign exchange rates as of January 31st 2020.
For the first quarter 2020.
Total revenue is expected to be in the range of 64.9 million to 65.9 million.
Non-GAAP loss from operations is expected to be in the range of 8.6 million to 7.6 million.
Non-GAAP net loss is expected to be in the range of 9.2 million to 8.2 millions.
Non-GAAP net loss per share is expected to be in the range of 30 cents to 26 cents.
This is based on a basic and diluted weighted average share count of 31.2 million shares.
For the full year Twentytwenty total revenue is expected to be in the range of 277 million to 279 million.
Non-GAAP loss from operations is expected to be in the range of 43 million to 41 million.
Non-GAAP net loss is expected to be in the range of 45.5 million to 43.5 million.
Non-GAAP net loss per share is expected to be in the range of one dollar and 44 cents to $1.37 cents.
This is based on a basic and diluted weighted average share count of 31.7 million shares.
We're proud of the skilled high growth business, we've built in the cloud and are excited about twentytwenty as cloud becomes a meaningful driver of long term value to talent and to our shareholders with that we will open the call for questions operator.
Thank you if you would like to ask your question. Please signal by pressing star one on your telephone keypad.
If you are using a speaker phone. Please make sure that your mute function is turned off to a lot of your signal reach our equipment.
And again to ask your question. Please press star one.
And we'll take our first question from Raimo and show with Barclays.
Hey, Thanks for taking my question.
Let's start.
Two questions first on the revenue guidance.
Due to them off like a professional services you gave us a number but it's too seems to imply that on premises and needs to be somewhat down. This year can you maybe talk us through like to on premise.
As cloud deals and how that will play out.
Then on the investments at the second question on the investments.
Talent has a history of kind of moving towards profitability et cetera, I know, we're taking a step down can you talk a little bit through what's kind of CP back period or how do you have to think about it is like a wonderful thing and that's it for like is it Creek snap back or is this like the longer term thing just just help us almost them.
What's the alright. Thank you.
Sure they removed.
Adam here, so I'll take the I'll take both of those so on the guidance looking see very clearly from the the cloud numbers that we gave for last year and what we're guiding to for this year that that cloud business really is the engine of growth for us going forward, we see the premise side of the business as it really strong base that will ultimately.
Fuel the cloud through migrations and that's consistent with the roughly 15 million that we think.
We will contribute to the cloud for this year growth has come down a premise side over the last year and has been kind of mid single digits at this stage and that's something that we solve play out over 2019 that we wouldn't be prudent for where that grows in twentytwenty, just given the market conditions and how fast we see the industry moving.
The base has been very stable from retention perspective, which would be very thoughtful given how fast market is is shifting one other thing I was just note here, we've gotten a lot of questions around and we wanted to address it today of that premise business not really going to break out the two pieces, but we have said in the past that big.
Data retention rate is is slightly above the rest of premise and then in basically that that was going to converge with the rest of the premise business. So big data was about a third of our air or a and that retention rate is very consistent with what it's been with what it has been for the overall premise side. So I hope that gives you a little bit of color for how we're thinking about the guidance and just.
The composition of between premise and cloud.
In terms of the cash flow guide, yes, a lot of this we do think about as important investments to make this year that will allow us to build a much more.
Scalable foundation for the business going forward, So Chris will walk through a couple of those and so did I. It's it's about making sure we're making the right product investments and bringing new cloud products to market note. Obviously continue in future years as well, but there's I think a decent amount of that that we're pushing for 2020.
It's about continuing to invest in the sales and marketing engine that we already have and continue to refine that and then I think a component that is more onetime in nature and really focus. This year is really around the operational and some of the systems investments that we want to be able to make to help us beyond frankly increased the velocity of the business overtime.
Okay. Thank you.
Thank you. Our next question comes from David Garrison with William Blair <unk> Company.
Hey, guys. Thanks for taking the questions.
Two if I could first one for Adam and I guess first off thanks are disclosed in the new cloud Air our metric that's really helpful and I think we have a great go forward disclosure framework here.
As we think about modeling cloud. They are I think it'd be helpful. If you could kind of double click on the underlying drivers of new air our bookings by maybe giving us a sense of what the mix of new versus expansion in upsells looks like maybe over the past few quarters here and what type of net expansion rate has been kind of embedded into the guide.
Sure.
So.
Got it was a couple of drivers for growth.
Obviously, continuing to win new business expansion within the cloud base cross sell of out into the premise base and then actually just migrating premise customers entirely.
We haven't broken out and we won't break out any specific net expansion rate for cloud we have set in the past that they are much higher than the overall average that continues to be true. It is off of a smaller cohort, but that will be an important part and driver of that new cloudy or our growth last year, the vast majority of that.
Cloudy or that we out it was really from new customers and we see that shifting to be much more balanced mix between expansions and new for this year.
Got it that's helpful. And then last quarter, you know you kind of noted the potential for some customers to temporarily pause or slow down expansion activity as they kind of took some time to kick the tires on the new cloud product and.
Evaluate their go forward strategies, given the aggressive pivot here to assess can you just give us a little bit of an update on the extent to which you saw that play out during the quarter or what you're hearing from customers and kind of your expectations around maybe how much of a headwind this could be in 2020.
Yeah, I think we saw that largely resolved itself in Q4 is as indicated by the strong at in terms of enterprise customers.
And so you know deal cycles for cloud aren't materially different than deal cycles overall for us.
And we think that no frankly, as we started the how conversations with customers about what am I Grayson looks like it's an opportunity to have a much more strategic conversation with them about their due to journey and every customer the chooses to either bias in the cloud or shifts in the cloud we really look at that is as a validation.
Of our position going forward and you know really vote of confidence in what we're building here.
Got it thanks for taking my questions.
Thank you. Our next question comes from Tyler Radke with Citi.
Hey, Thank you good afternoon, so I.
Adam I I was wondering if you could talk about the guide for 2020, specifically around.
Cloud, a our and revenue.
At 12% growth I think a lot of investors.
There are trying to understand the kind of gives it the long term kind of framework of reaching a billion dollars with you know the deceleration. This year, maybe just help us understand I'm kind of what are what are the moves the that you're making this year, that's that's causing that.
Sharp deceleration in overall growth in that even if you look at the cloud a our guide with the conversions it implies that kind of the net new and an overall growth in caught a ours is down meaningfully from where it was in 2018 or are starting in 2019. So maybe just help us understand how much.
Just kind of conservatism versus you know specific actions that you're taking thank you.
Yeah of course.
So you can see from the the air our guidance that we're giving that results in about $46 million, New cloud 15 of that you think about as migrations.
Is that starts to help break down.
Exactly how the the cloud guidance is built up that's still we think of really significant add on the base that we have and look if.
If there is upside there, we frankly could see upside across any fronts, whether it's new customers faster migrations or just frankly.
So when customers migrate, but given the kind of capacity we have in the system right now within the pipeline and what we saw in our ability to add to cloud last year.
We wanted to be fairly prudent in our expectations.
And so.
The other implications you can see through and I think I already mentioned in the first in the first question is.
Really this guidance would assume that basically all of the growth in the business is in cloud and that is frankly, a reflection of just the strategic push we're making a and and the orientation. The crystal in the team are bringing to the go to market motions.
Yeah, maybe I can jump in here as well Tyler and just dropped off of what Adam was just talking about you mentioned coupling with how that gets us to 1 billion and I think it's helpful. Just to provide some perspective that wall Adams, absolutely right, we're being prudent about that journey.
Really comes down to in my experience and things that I've done in my prior life as a zero up concur is this is about investing in the right things right now because we see such a massive opportunity in front of us and with the cutting edge Tech that we have in the you see that we're on fire in cloud with our growth.
And now we want to make sure that we're taking every opportunity to put the right processes and systems in place to make sure that we can scale our business and we can have long term profitable and sustainable growth and really get prescriptive with our motions in the field and make sure that were really lined up and that.
We have worked directed at the right market opportunity and that we're really taken advantage of the resources, we have to make sure that there as productive as possible and so I believe and we believe that this is an opportunity to really build a solid foundation to run a fast that 1 billion, but we have some work to do.
Great and if I could ask a follow up to that Crystal. So you know I think one of the one of the interesting things about talons pricing model versus competitors. It's generally been kind of seat based you know based on a due to engineer and integration expert versus something that's.
You know sold on a data throughput basis and I'm I'm. Just curious is as you've thought about your goals in reaching that billing in and you know expanding the share of wallet within some of your large enterprise customers.
You know do you find any you know do you see for C., the need to potentially make any changes to pricing or is it a matter of just getting more kind of integration experts onboard or how do you kind of for see that expansion within the large enterprise accounts that you already have and you know maybe argue.
We have already been selling to for a close close to five to 10 years, just help us understand how you see you know the path forward to expanding those relationships. Thank you.
Yes, Tyler it's a the path forward could contain a number of different lanes and avenues and worked flooring all of those if you just simply look at even the top 2000 or you know you look at the you know even at top 1000 or customers are companies in the in the industry.
Even if we just focus simply on the top 1000 enterprises and we just expand our footprint in our customer base now that's an exceptional business and that would be a massive opportunity for us and so looking at that in a way that as Adam pointed out that looking at helping as say not only moved to the cloud, but then also.
Expanding our footprint in our existing customer base as we've done with Astrazeneca and a number of other customers to solve multiple problem just that alone has a big opportunity for us they had a billion, but there's there's multiple opportunities all the way across our business, including from the bottom up with it and so you will continue to.
Assess those opportunities and our evaluation of.
How fast we can get there will continue as well, but there you know there's a number of different ways that we could run after that.
Thank you.
And we'll take our next question from Marty Tonight.
With JP Morgan.
Hey, this is an ambition on for Mike Murphy with the increased focus on cloud bookings trying to understand that a little bit better what percent of your cloud bookings would you say related to projects with major SaaS providers.
Yes sales force Workdays service now versus what percent of them really tomorrow no modern data warehouse now an extra that it's like Snowflake bakery did it risks.
Hey, it's Adam I'll take that the vast majority.
Of our cloud business is gonna be connected to more of the data warehouse or the platform side. Yeah, we see that that that is really where where theres a.
Oh logical and symbiotic relationship for for cell together those projects often times are kind of tie it up with the broader.
Yes application ecosystem.
And so our connectivity connectivity is critical.
As a big differentiator for us.
And so it's not really one or the either but typically in a deal process, we're going to be mostly tied to someone deciding to shift their warehousing environment.
Okay, Great. That's interesting and then a quick follow up you guys kind of call that strengthen it then the APAC region and named and impressive Nissan like what's the dynamic driving that no strength in that region.
Yeah. So.
Hey, Thats been a a really fast growing market for us.
The Nissan example, the Crystal walk through it is I think really consistent with what we're seeing across all regions and all industries, where data becomes a critical component of the business model and strategy for these businesses and so there their ability to connect what they have in legacy system.
Score operational systems, as well as things like SAS applications and cloud environments to develop a cohesive view in this case around a vehicle Threesixty project.
His that's a very similar dynamic that drives.
A lot of our deals in a lot of our value in both the analytic side as well as operational use cases.
Great. Thank you.
Thank you well take our next question from Jack Andrews with Needham.
Okay.
Hi, good afternoon. Thanks for taking my questions I want to start off with a question for Crystal If I could you know I. Appreciate your comments on the similarities between your previous experience would concur and really as it relates to tell line in terms of cloud and data just wonder if you could drill down a little bit more in can talk about the specifically the the go to market Playbooks.
What do you think worked well the concur that could be specifically apply to travel and maybe what how is how was telling different from from concur as well.
Hi, Jack I'd be happy too so when I think about the similarities if it comes down to a couple of things.
Being extremely prescriptive I see a huge opportunity here at talent, where we have an opportunity to look at swim lanes around how do we go to market, what we choose to focus our energy on how we line up to look at Mark to market opportunity at both the top into the market as I was mentioning before with our with our enterprise customers and.
Addressable market as well as downmarket with some of our frictionless business and so what I've seen really work well is just being very decisive in what you're going to focus on making sure that every single one of your resources are lined up to be as productive as possible and making sure that the rights systems and processes.
As are behind them. So that you can really put the volume and the velocity through two really turn it into them a massive growth engine and I and I see the similarities here and the opportunities that are that are sitting in front of us.
Great. Thanks for that and then if I could just follow up on the.
Migration opportunity for you is this something that you are going to be actively encouraging in incenting. How your sales force to to work on or do you think that this is something that's going to just happen naturally and that's how you are rising up this projected $15 million on that front for for the current here.
We need to taking a little bit of what I, just said a moment ago were being prescriptive about everything and very very intentional. So we'd have a dedicated a group of individuals who are working alongside our existing customers and what we're doing is we're really helping them on their cloud journey. A this is more than just start contemplating talent. This is real.
Looking at all the things that look at news that technologies, and so forth and we believe that being at a good partner and a good evolution of their journey to to work alongside them I think over the next couple of years two to three years, you'll really see that start to uptick even more but we will meet our customers where they're at and make.
Sure that were working alongside them, but we're going to be very intentional and prescriptive about doing that.
Got it thanks for taking my questions.
You bet.
Thank you and we have no further questions in the queue at this time, ladies and gentlemen. This concludes today's conference. We thank you for your attendance and participation and you may now disconnect.
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