Q4 2020 Palantir Technologies Inc Earnings Call
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[music] good morning, welcome to <unk> fourth quarter, 'twenty and 'twenty earnings call, we'll be discussing the results announced in our press release issued prior to the market open and posted on our Investor Relations website during the.
These statements are not promises or guarantees and are subject to risks and uncertainties, which could cause them to differ materially from actual results information concerning those risks is available and our earnings press release distributed prior to market open today and in our SEC filings, we undertake no obligation to update forward looking statements, except as required by law.
Further during the course of today's call, we will refer to certain adjusted financial measures. These non-GAAP financial measures should be considered in addition to and substitute for or in isolation from GAAP measures additional information about these non-GAAP measures, including reconciliation of non-GAAP to comparable GAAP measures is included in our press release and Investor presentation provided today.
Our press release Investor presentation, and our SEC filings are available on our Investor Relations website at investors day talent here Dot com.
Welcome Pallets, you had a very strong year last year and.
And because of the strength of your it it might be worth taking and attacking and asking well what you. The numbers actually mean, obviously on the face of them, they're strong and even curiously strong. We believe I believe that talent yours numbers are a lagging indicator.
Of several macro trends that we got right.
First is the obvious macro trend that is almost become and banality that the world is becoming a software world and institutions that survive and thrive and provide benefits to their citizens. Both in terms of actual output, but also real output meeting output that includes data protection and net and make sure that the data is.
Actually preserved and a way that guarantees its ferocity that gives comfort to us citizens that make sure the citizens arent nearly a product to be monetized.
And second that as diverse as the institutions are that we work and from <unk>.
And S and services to providing a AI in in and in the most sensitive military context to working with our oil and gas companies to airlines to pharmaceutical research to all aspects of of of helping to ameliorate the plague that as Covid, there's one trend.
And.
Institutions countries individuals that can assess the value of software that can work now are the institutions that survive and provide value both in the government commercial and even moral context moral is defined by they increase the legitimacy of institutions.
And of the primary issues, we have in the west is a dearth of legitimacy of commercial and government institutions of experts and this makes it very impossible to navigate issues around how do you rebuild your company internally and externally true too to conform and thrive and in a very <unk>.
Difficult context.
Where there's a there's COVID-19 rebuilding supply chain and political volatility uncertainty and general skepticism about anything you say that is a software problem. How do you actually look at the data understand that the data is actually true understand the veracity of the model.
How do you understand how can you prove to people that their data is not being be abused monetized used to discriminate against them, where the people listening to you have a great deal of skepticism how do people who are on this call, presumably really trying to evaluate the actual value and meaning of our numbers.
It's very hard for them to do free for to understand this without understanding what is the actual background of the numbers are they afford indicator or a lady a lagging indicator of a macro trend that you either got it right or wrong, one of the interesting things about philosophy history.
And software is that.
And when something becomes crucial to our society, absolutely determinative it sets off a dialectic of learning so that the what we understand about what it means to procure software use software.
Integrate into a world that is defined by software.
He is very different and what we would have thought about it when he was a luxury product and that's largely how software has been viewed heretofore. It is something that can augment.
And your enterprise your government it can make your enterprise.
Slightly better than your competitor and a myriad of context. It can make your military slightly more efficacious slightly more transparent or and some context less transparent it can make things more cost effective but that's not the context. We're in now we're in a context, where it is basically binary.
And societies, which implement software effectively will dramatically outperform and it and in every context in the military contacts and the claim deaths and contacts in the Covid context in the context of every day.
Commercial entity that we're involved and and everyone I've ever seen and everyone you've seen and.
And then the real questions like well what does it mean to survive in a in a COVID-19 like context or how do you stop the next pandemic in and it in and western constellation where civil liberties data protection.
Is crucial you you can't just we orchestrate the society and we orchestrate the data and we.
Without having buying from the people that nominally or hopefully completely control the society.
And that those are those are software problems and then the people who are in charge have to or are going to learn and we'll learn over time well what does it mean when someone says that software works what does it mean for software to be implicate input implemented effectively what is the actual alpha is the alpha adjust the output or is it the output.
Also measured against the moral.
Context, the moral imperatives that allow us to unify and of society.
And a very famous quote from victims, China's legal inveigle folding tsuga openness, Nissan and Vegas reform, which means roughly clarifies to believe you're following rules and to fall a rule. There is this typically use to explain our important trend and in language philosophy, but you could also look at this as like a Q T use software it doesn't mean to <unk>.
And actually use software if software is absolutely determined is of the current condition just like language wise, it's like and a philosophical sense you could say we've had a shift from.
The language imperative or language is actually what deferred to determines meaning.
Two a software context, where it's actually software is determining meaning value and legitimacy why do commercial and government institutions struggle with legitimacy.
And many cases, it's very hard to understand what is the output how did it happen under what context, what was paid for what did we get.
And then the structures, we've built are treating software as a cosmetic augmented Ah <unk>.
Attribute when in fact software is the language of our time and we.
And mastery of software will determine what works and what doesn't.
And numbers that you've seen a reflection of our bet that this would happen.
And they are a lagging indicator and we believe that the the transfer.
Transformation, which is happening and the world now will accelerate.
And that the way in which we're providing software both.
Foundry Gotham and our ability to scale this through Apollo will be the way that everyone. At some point, we'll actually try to build software and the way and wished institutions will procure software because of a dialectic of macro and micro conditions of dialectic, which will force change because the winners.
Figure this out.
On today's call, you'll hear from Alex Karp, founder and Chief Executive Officer, Sean <unk>, Our Chief operating Officer, Dave Glaser, Chief Financial Officer, and Kevin Kawasaki Global head of business development.
With that I'll turn it over to Sean.
Thank you Rodney.
First I'd like to congratulate the NHS and the UK for a stunningly successful vaccine rollout. The NHS is truly a national treasure I'd also like to congratulate HHS protect and winning gardeners eye on innovation awards from government and 2020.
And finally, I'd like to congratulate U S space Force is Kobe, Aki Meru, Theyre cutting edge software factory for winning the software innovation team and gears of government Awards.
<unk> to 'twenty and 'twenty results 2020 was a seminal year for talent here and we held 100 commercial organizations and Penn National governments respond to the Covid crisis.
We were able to solve incredibly complex problems and three days and enabled our customers to reinvent themselves amidst these continuous shocks.
But of course, that's not just three days, it's 15 years of product development more than $2 billion on R&D and three days.
And for many of those customers and a short period, we became their default operating system, we became critical to the core functioning of their operations.
And meeting that moment, our business grew significantly in 'twenty and 'twenty, resulting in 47% revenue growth on a full year.
And we created and continue to create substantial opportunities for growth over the next year and beyond.
Last week, we announced a groundbreaking partnership with IBM, where IBM will OEM, a number of foundry modules and it's cloud Pak for data offering enabling commercial customers to easily build AI infused applications, leveraging a trusted data foundation and enterprise AI. This partnership dramatically expand our distribution capabilities.
Virginia, Ibm's data and AI is 2500 and sellers for contact that is a sales force that is larger than all of volunteer.
Along with an already large installed base and clawed back customers.
We're very excited about what this partnership means for our go to market in 'twenty and 'twenty, one and beyond.
The response since the announcement from prospective customers has been incredibly strong there's a lot of momentum a lot of energy.
And we will continue to pursue channel partnerships to enhance our distribution.
The product grade and momentum is clear and building across those segments of our business, we invested and technologies that would help our customers get value fast and create enduring operational value that can bounce continuously delivered upgrade to our software become upgrades to our customers' businesses, our foundry and 21 launch represents the culmination of that work.
And with software defined data integration and we're automating away the complexity of integrating systems with a drag and drop interface frontline business users can build production great AI infused application.
Modularity allows customers to take what they need and build on what they ask.
Archetypes Green point, and click use cases to accelerate outcomes.
And all part of how upgrading our software upgrades their business.
As we move into 'twenty and 'twenty. One these innovations are not only helping our customers generate value much faster and theyre also allowing us to broaden our go to market.
We expect to add triple digit head count to our sales function this year.
And our commercial segment, we generated greater than 100% U S revenue growth and 2020 on the back of investments and our direct sales force and the fourth quarter, we signed several large deals with customers across a variety of sectors, including automotive and energy health care insurance mining and shipping.
We signed a multiyear enterprise agreement with Rio Tinto and the fourth quarter. This partnership is the culmination of several foundry deployments integrating data from across Rio Tinto operations spanning 90, plus system, including machines sensors and instruments.
These initiatives helped Rio Tinto transform borate and to a digital business across the value chain to increase production and enhanced profitability and connect people and Rio Tinto is underground operations with data.
Foundry will be both a single source of truth, combining operational and transactional data and digital twin that will enable Rio tinto as employees to make data driven decisions and take action from headquarters to the mine phase.
We signed a multiyear contract with Pacific gas and electric to help streamline operations across the company P. G and eclipsed 10 billion data points every day spanning both structured and unstructured data, which would be the digital twin a P. G knees network within foundry to enable root cause analysis and upgrade monitoring.
We expect this will allow them to improve their electric operations and asset management, resulting in enhanced safety and grid reliability PGE will have a single integrated platform, providing a complete operating pictures and a fast effective data driven decisions and it's public safety power Shutoff program, which will help mitigate future wildfire risks and.
And this is just the beginning of our joint enterprise vision in.
In addition, we signed a significant expansion with a fortune 50 healthcare company and the fourth quarter across the health care industry. There are increasing market pressures ranging from reimbursements that are becoming tied to value based care, increasing cost of pharmaceuticals, as well as an expanding number of competitors.
Managing unit profitability at a granular level becomes much more important in this environment and this customer was facing the inability to model their complex contract and pricing models in order to make actionable decisions, where the negotiations and payment management.
Issue is wildly complex as it involves managing the balance between revenue and cost of goods sold models that are managing the network of suppliers and supply chain labor payers and regulatory coefficient by integrating these disparate sources into foundry and the <unk>.
Customer now has a contract management solution that automates the way, there's complexity, allowing the company and focus on operational decision, making and outcomes and this has already led to $50 million and annualized value.
We continue to deepen our partnership with BP and and the fourth quarter, we signed a five year nine figure enterprise renewal.
We have worked with BP since 2014, our software is the backbone of Bp's digital twin applications, which has generated over $1 billion of value and 2020 as part of our ongoing partnership our software will help <unk> continue its transformation as they work towards their net zero ambition. These applications will accelerate P. Pes initiatives and wind power electric charging network solar power generation and.
And other initiatives to deliver energy more safely and efficiently for years to come.
We're also deepening our work with the Fortune 200, industrials manufacturing customer and a relationship rapidly evolved over the course of 'twenty and 'twenty to incorporate several use cases within foundry.
As a manufacturer of personal protective equipment, this customer and faced substantial supply and demand shocks into the onset of Covid accentuating the need to re imagine the firm's supply chain management and order processing practices and.
Through integrating its baseline supply chain performance models and order fulfillment records and the customer was able to move away from its first and first out order fulfillment and deliver PPE to those who are most in dire need all and under a couple of weeks.
The customer is using our software to address enduring challenges, including modeling supply chain scenarios and conducting forecasting and demand sensing to alert users to future bottlenecks and inventory risks and.
And net result is a decision making engine at the intersection of a connected supply chain with connected manufacturing.
Turning to our government segment are goth from 'twenty, one launch underscores both our ongoing vision to provide the central operating platform from government as well as our focus on the near beer fight and the defense context, we made extraordinary progress on these initiatives in 2020 overall the full year government revenue rose, 77% led by ongoing momentum and the U S which grew 91%.
As tremendous of a year and 2020 was from the government segment. We believe we are just at the tip of the iceberg and we're well positioned to capture significant new opportunities in 'twenty and 'twenty, one and beyond.
And our intensive product investments and developing and end to end sensor and the shooter and based and mud capability are paying off and we're creating unique opportunities to enable the warfighter with AI superiority and that technology is starting to create large program of record opportunities across the services.
Our partnership with the U S. Army continues to expand vantage is a critical asset for the army to support both readiness and financial management and should help the army free up $3 $3 billion for reinvestment.
In December the army exercised its first option year and we are excited to continue this work with army vantage.
We recently won a pair of new contracts with the army to accelerate its modernization efforts and November passenger was selected to provide a prototype for the army's comm and data fabric and data security solution to support capabilities at 23.
This is yet another opportunity for our software to be used and the mission command space operating at the intersection of Intelligence mission planning and execution. It is a true honor to have the opportunity to aid the army and its efforts to provide an integrated solution that will ultimately improve access to critical data for commanders and soldiers deliver efficient use of networks and denied integrated environment.
And increased the collaboration with joint and Allied partners.
And January we were down selected to deliver a prototype as part of the Army's ground station modernization and supported the tightened program under the $8 $5 million phase one contract Poucher will collaborate with the army to demonstrate a solution that integrates space high out aerial and terrestrial sensors for use and intelligence command and control the overall solution, which carries a <unk>.
Total potential contract value of a quarter of $1 billion across all phases will provide operators down range and shorten targeting timelines by incorporating data integration sensor fusion and advanced analytic capabilities using AI.
We were built for this those user product investments I was just mentioning that today we.
We are looking forward to continuing our work in this area with the army as well as pursuing similar programs with other services.
And while a lot of new 'twenty and 'twenty U S defense opportunities started as crisis response to Covid.
Almost all of it is relevant and to enduring problems and needs. For example, we started working with the Air Force in May of 'twenty and 'twenty to support their Covid response. The engagement has supported COVID-19 testing PPE availability and helping plan vaccine distribution and personnel availability.
But it's also clear to the Air force, how it can fail to fleet availability combat readiness and equipment readiness.
And the U K pound share software is powering three of the country's most important national priorities PPE vaccines, and managing trade post Brexit and December we signed a two year contract with the NHS worth up to $31 million were foundry will serve as a core platform for secure reliable and timely data processing to any.
Decision makers to efficiently plan and distribute resources improve patient care and protect patient privacy. Additionally, the highly successful U K vaccines program ordered allocated tracked and delivered their vaccines in boundary.
While we continue to partner with the world's leading health care institutions to combat COVID-19, we closed deals that are focused on supporting their ongoing transformation and a post COVID-19 world.
And the fourth quarter, we expanded our relationship with the FDA with a three year $44 million contract our partnership with the FDA began in 2017 to aid the oncology center of excellence and regulatory research across clinical trial data.
Our relationship evolved over time to include the center for drug evaluation and research Cedar, which we assisted in the fight against the opioid crisis and supported regulatory review activities. This new agreement. We will continue our work with the FDA and mission critical enduring workflows, such as ensuring manufacturers are complying with agency rules and regulations and enhancing drug reviews and speed.
Time to market, while maintaining the highest safety standards and there is significant opportunity for further expansion and our work today touches on just two of 16 centers and offices at the FDA.
We closed out the year with strong momentum and the fourth quarter. We signed many significant deals 21 deals worth $5 billion or more including 12 deals each worth 10 million or more and aggregate will generated 47% annual revenue growth, we saw customer concentration and revenue concentration decreased even as the number of significant deals grew our pipeline and.
Tangible and growing.
These deals they start in the acquired base of our three phased model and with new customers, who are acquired in year that have yet to even join a face.
Both of these groups performed exceptionally a very positive forward looking indicator.
Additionally, the intensive growth of existing customers continued with average revenue per customer growing 41% to $7 9 million.
We grew the number of accounts with $10 million of annual revenue or more by 50%.
We're continuing to demonstrate our ability to grow customer relationships at scale as we add ever increasing value to our customers enterprises.
And it's still very clear that we're just at the beginning our customers include only eight of the Fortune 112 of the global 100, and only 24 of the global 300, and the opportunity in front of us is immense and growing.
And finally I'd like to thank each and every habit for their exceptional efforts in 2020.
You weren't where you were needed most from the front lines and the vaccine to the factory floors and PPE manufacturers.
From the breathing room to prime ministers to the war rooms, where the Nitty gritty work actually got done you built the products that met their moment and you did all of this while driving the operational changes and support functions and executed the business you supported each other through the ongoing trials and tribulations of the pandemic.
You are all a constant reminder, that not all who wonder are lost.
I am proud of what you've accomplished and I'm, so very honored to call you and co workers.
And I'm, very grateful and often and disbelief for the joint opportunities that we have for impact.
This truly is only the beginning.
Thank you.
To kick off the discussion on our financial results I'll now pass it off to carpet there are many insights and indeed, some secrets that are powered talent here and got us from a company that and the beginning no and believe would would succeed because we were heavily focused on strengthening the west through.
And your fanatical fixation on data integration and data protection when we transferred to the commercial World people didn't believe that would succeed because theres no history of anybody going from government commercial and when we went when we became a global company people didn't believe that would succeed because.
The global it typically companies that started with it and the American government or and America do not succeed or thrive abroad.
When we when we went and did our D. P. O people thought we should IPO because that is the best and quickest way to transfer.
And money too.
Wall Street.
But we believe we should be focused on allowing the average person to participate and therefore absorb that risk.
And now as we've had a pretty simple lime year based on any conventional metric.
And as you've seen the results we want to underscore this relentless focus what you could call and insights secret, which should be of banality of business have a long term focused on the health of what we believe is and will continue to be one of and will become the most important software business and the world and to do that we're providing long term guidance.
Pretty pretty radical and the sense that we are where we are committing to keeping our growth threshold of above 30% for the next five years, but not focus on the day to day quarter to quarter, our near term focus that quite frankly destroys businesses is one of the main reasons why so many of our business, especially and tech are actually only serve.
And wall Street, and not serving their clients and not serving everyday and every day investor and and generate suboptimal returns over time, because they too are a lagging indicator of the suboptimal performance near term my my offices and of of of running a business and a pound share obviously, we have rejected.
And every way both from the way we produce <unk>.
We're from the way, we interact with clients from the best we've made that tend to be about to come to fruition years. After a very very significant investment and in case, we hope those of you on this call.
Who are our current investors.
And stay with us and those of you who prefer a more short term.
Focus that you choose companies that are more appropriate for you.
I'll review, our fourth quarter and full year 2020 performance followed by our outlook.
Full year 2020 revenue was $1.093 billion of 47% year over year.
Fourth quarter revenue was $322 million of 40% year over year, and roughly $21 million above the high end of our prior guidance range and.
In addition for the full year 2020 average revenue per customer was $7 9 million up 41% year over year.
Average revenue per top 20 customer was $33 million up 34% year over year with our top 20 customers representing roughly 61% of our total 2020 revenue down from roughly 67% in 2019, as we continue to broaden our revenue and customer base.
For the full year 2020, 43% of our revenue was generated from new customers and 2018 or later exemplifying, our improving ability to rapidly onboard customers towards software and realized compounding value as their data assets grow and use cases develop.
We see this scaling taking place across our customer base.
In 2020, the number of customers generating more than 1 million and revenue annually grew 32% year over year customers generating more than $5 million annually grew 54% year over year and customers generating more than $10 million annually grew 50% year over year.
And the fourth quarter alone, we closed 21 deals of 5 million or more and total contract value, including 12 deals were $10 million or more.
Looking at revenue by segment government revenue accelerated in the fourth quarter growing 85% year over year to $190 million.
We signed several large deals and the quarter, including a three year $44 million expansion with the U S food and drug administration and a two year 31 million agreement with the NHS.
In addition, we announced that the U S Army executed its first option year with approximately $114 million as part of our partnership on the Army Vantage program.
For the full year 2020 government segment revenue grew 77% year over year to $610 million and represented roughly 56% of our total revenue.
Fourth quarter commercial segment revenue totaled $132 million, a 4% year over year, while full year commercial segment revenue grew 22% year over year to $482 million and we continue to see strong momentum and our U S commercial business heading into 2021.
U S commercial revenue rose, 107% year over year and fiscal 2020, aided by our ongoing investments and our account based sales force and channel partnerships.
And the fourth quarter, we signed several large deals, including a nine figure renewal with BP exemplifying our software is enduring impact and value even in a sector that has been fundamentally challenged as of late.
Also in the fourth quarter, we signed eight additional deals where that leaves $10 million and our commercial segment.
I'll next discuss our margins and expenses on an adjusted basis, which excludes stock based compensation.
Fourth quarter adjusted gross margin was 84% of 200 basis points versus a year ago period and full year adjusted gross margin was 81%.
1000 basis points compared with full year 2019 day.
Year over year improvement and gross margin was driven by increased automation and efficiency and the delivery of our software.
Contribution margin was 62% and the fourth quarter nearly double the contribution margin of 33% and the year ago quarter, which highlights the efficiencies, we have generated and customer acquisition and contract execution.
Turning to operating expenses total fourth quarter adjusted operating expenses were $186 million, which includes approximately $19 million and employer payroll taxes related to stock based compensation. Excluding these expenses total fourth quarter adjusted operating expenses would have been $167 million.
Fourth quarter operating income, excluding stock based compensation and related employer payroll taxes was $104 million, representing an adjusted operating margin of 32%.
The outperformance and adjusted operating income was primarily driven by higher than expected revenue and quarter continued inefficiencies and our go to market and delivery and me and server software as well as reductions and cloud hosting costs full.
Full year, 'twenty and 'twenty, adjusted operating income, which excludes stock based compensation related employer payroll taxes and non recurring expenses related to our direct listing was $190 million, representing a margin of 17%.
As we noted last quarter, we have historically pursued multiyear upfront payments from our customers, which has led to significant growth and contract liabilities and prior periods, such that billings and cash questions often exceeded revenue.
Over the course of 'twenty and 'twenty, we've moved away from a practice of collecting multiple years of upfront payments, which has led to lower 2020 cash collections and a greater portion of our revenue coming from the recognition of such contract liabilities.
We expect this to begin to normalize over the course of 2021 with cash collections and revenue moving more and parallel overtime, which will drive positive cash flow from operations for the year.
We measure revenue visibility across several metrics.
First we ended 2020 with total deal value across the business of $2 8 billion, while year and dollar weighted average contract duration was three six years.
This growth rate is particularly strong when considering government customers entered into shorter than usual contracts and 2022 accelerate procurement as he responded to the Covid crisis and move quickly on various monetization efforts across both defense and civilian agencies.
We expect a tailwind for government as these customers renew and expand.
Second our remaining performance obligations as of December 31, and 2020 was $597 million up 124% year over year, while current RVO increased a 114% year over year.
Although RVO provides a limited view into our business as many of our contracts across our government and commercial segments feature termination for convenience causes the growth and these metrics is representative of the ongoing and momentum, we're seeing and our business.
Third we look at annual contract value booked and year on a dollar weighted duration basis and <unk>.
2020, the dollar weighted annualized contract value, we closed increased 49% year over year, providing a strong foundation for fueling growth in 'twenty and 'twenty, one and beyond across both our commercial and government segments.
Looking at the business through the lens of our three phased model. We ended the year with strong performance across all three cohorts.
Our required for these customers and to 2020 generating $77 million and revenue was 17% contribution margin with nearly half of the revenue from these customers coming in the fourth quarter.
This rapid scaling and expanding contribution margin demonstrates the increasing efficiency of our customer acquisition and Onboarding process, which we believe low fuel and expanding pipeline into 2021 and beyond.
And phase customers continue to see increasing value and our software platforms fueling consistent upsell and cross sell opportunities.
These customers generated $360 million and revenue for the full year, 'twenty and 'twenty with a contribution margin of 47%.
This represents over 100% year over year growth for this customer cohort and this growth was extremely efficient and these customers generated contribution margin of negative 43% and fiscal year 2019.
Finally, our scale for these customers continue to demonstrate a strong combination of growth and profitability as these customers generated $613 million and revenue and 70% contribution margin and 2020, representing 8% year over year growth and a 500 basis point expansion and contribution margin compared with the same customer.
<unk> and fiscal year 2019.
In addition for the full year 2020, we generated $42 million and revenue from new customers, we acquired and year of which $19 million was recognized in the fourth quarter.
This compares with $4 million and the fourth quarter of fiscal year, 2019, and represents 375% growth year over year.
You heard from carb about our long term orientation.
As we move into the future. We believe our investments will help us sustain elevated growth rates for the next five years and beyond as you pursue a broad range of opportunities across our commercial and government segments.
For our five year outlook, we expect greater than $4 billion and revenue in 2025.
Starting in 2021, we expect greater than 30% annual revenue growth each year for the next five years.
And in Q1 of this year, we expect revenue growth of 45% or $332 million at the midpoint.
And we expect adjusted operating margin of 23% for the quarter.
With that I will turn the call over to Rodney to open up Q&A.
Thanks, Dave, Sean and Dave and Kevin will join me for Q&A today, and will begin with some shareholder questions from say.
And I'll start with you on this first question.
Alan here is guiding for double digit percentage growth this year and counter sustain such a compound growth rate barring any unforeseen negative economic impacts or should investors expect choppy yearly growth numbers can you comment on our long term expected growth rate.
I'll build on what Karp said earlier and the call and long term guidance. We are very much at the beginning here. We just did 45% growth and 2020, we expect to do so.
37% growth and 2020, we expected to be 45% growth and Q1 of 2021.
And we are only in 24 of the global 300, but I think looking at that kind of misses the point around the Tam expansion and Thats currently happening look at the channel partnership with Fujitsu and IBM amongst others, where we're not just distributing to the top 300 or the top 1000, but really we have the ability now to distribute to the entire market potentially tens of.
Thousands of customers and.
And with our investments and the end to end and third a shooter workflows from state and mud, we're not just going after the roughly $60 billion of government it and anymore, we're talking about the quarter trillion dollars.
Of USD <unk> weapon systems and 2020.
And our product investment that we are uniquely positioned to seize those opportunities broadening the market is not about <unk> light, it's about pound share automated it's about the power of the Apollo <unk> got software that manages itself.
And our architects and investments like this meeting with a few clicks you can deploy and Joe and powerful use case use cases that would have cost millions of dollars and taken many months can now be deployed and minutes. It's.
It's about software defined data integration and modularity that means that you get 100% of the power of volunteer but with the ease of self managing software and these are examples of why we're confident in our long term growth of being greater than $4 billion and 2025.
Great. So the next question is on dental day, and I'll stick with you.