Q2 2022 Domo Inc Earnings Call

Ladies and gentlemen, thank you for standing by and welcome to the Domo second quarter fiscal year 'twenty 'twenty two earnings conference call. At this time, all participants are in listen only mode.

After the speaker presentation.

There will be a question and answer session.

To ask a question. During this time you will need to press star one on your telephone keypad also please be advised that today's conference is being recorded.

Acquire any further assistance. Please press star Zero I would now like to hand, the conference over to your speaker today.

Vice President of Investor Relations Mr. Peter Lowry. Thank you. Please go ahead.

Good afternoon, and welcome on the call today, we have Josh James our founder and CEO, Bruce felt our CFO and Julie Kehoe, Our Chief Communications Officer.

Julie will lead off with our safe.

Safe Harbor statement, and then onto the call Julie.

Thanks Pete.

Our press release was issued after the market close and is posted in the Investor Relations section of our website, where this call is also being webcast.

<unk> made on this call include forward looking statements related to our business under federal Securities laws, including.

Statements about financial projections, the plans and expectations for our go to market strategy, our expectations for our sales and new business initiatives.

Pact of COVID-19 on our business and our <unk>.

Financial condition. These statements are subject to a variety of risks uncertainties and assumptions for a discussion of these risks and uncertainties.

Please refer to documents, we filed with the SEC in particular today's press release, our most recently filed annual report on Form 10-K, and our most recently filed quarterly report on Form 10-Q. These documents contain and identify important risk factors and other information that may cause our actual results to differ materially from those contained.

Contained in our forward looking statements. In addition, during today's call we will discuss non-GAAP financial measures, which we believe are useful as supplemental measures of domo as performance other than revenue unless otherwise stated we will be discussing our results of operations on a non-GAAP basis. These non-GAAP measures should be considered in addition to.

And not as a substitute for or in isolation from GAAP results. Please refer to the tables in our earnings press release for a reconciliation of our non-GAAP financial measures to their most directly comparable GAAP measure with that let me hand, it over to Josh over to you Josh.

Thank you Julie.

Hello, everyone. Thanks for joining.

Turning the call.

As everyone is still dealing with COVID-19 at different levels, depending on the pockets of the country You're world you live in we hope that you and your loved ones remain safe and healthy.

In Q2, our business momentum continued.

As the first cloud native modern bi platform Domo posted 26% billings growth and I hope to see.

He is about this level or higher the next several quarters as we strive towards getting a three handle in front of our growth numbers for the long term.

We posted 23% subscription revenue growth and 22% total revenue growth as well.

Obviously, I'm very pleased with our continued strong execution.

Let me talk about a few things that I think.

At our recent success and why we expect it to continue.

First we see that market forces have been really working in our favor.

Digital transformation initiatives remain a key area of investment and a strategic necessity for organizations of all sizes.

We.

Or behind we're seeing favorable trends because companies are wanting a cloud first open agnostic partner for their data platform.

We are truly benefiting from the building momentum for the breadth of apps that are built on our platform, including those that are powered by our data science.

We are also domo everywhere technologies.

And for all intents and purposes, when we are selling apps or when we're in App assisted deals.

Our traditional head to head competitors effectively dropped to zero.

And to touch on our recent big deal that we closed last quarter, we're already seeing increased revenue and success there as well.

Our ability to deliver bi leverage at cloud scale in record time is is a successful formula.

As a validation of our approach.

In Q1, and the 2021, Gartner magic quadrant for analytics and bi platforms.

Domo moved up to the challenger.

LNG quadrant.

Also in Q2 in the new 2021, Forrester wave for augmented by platforms.

Domo was named a leader and a quote rising star for full stack by Trans Lytic will in no code applications.

This will be a boon to our sales organization I should think.

<unk>.

Now, let me talk about a few of our recent customer wins.

Q2 was a strong new logo quarter with accelerating customer count growth.

Momentum with partners and legacy replacements as customers modernize their systems.

Many of our.

Significant wins. This quarter also included our sales plays targeting I T NPI groups directly as well as line of business leaders.

And we're seeing dramatic accelerating pickup of our apps, especially those derived from our domo everywhere and data science technologies.

One of the new logo wins this quarter.

<unk> was a division of a multinational asset management firm with over one trillion dollars in assets.

This division provides digital wealth management technology solutions to its financial advisor clients.

They created an app leveraging our domo everywhere technology to provide self service analytics for.

For these clients, allowing the sharing of its real time data with a financial advisor customers through its proprietary adviser portal.

Actually in this case, we're serving our customers' customers' customer.

Another new logo win was with a pharmaceutical provider to a long term care facilities to provide.

Analytics to its customers.

They had invested in our legacy data warehouse that was expensive to maintain and could not meet their internal or external data needs.

They required an embedded self service easy to use app for pharmacy, and nurse consultants that only domo can provide through our app framework.

Work and Domo everywhere technology.

One of our significant Upsells. This quarter was a seven figure deal with a European based life Sciences company to measure marketing ROI and to provide a data science app that could deliver marketing insights at a global scale of cost across countries and brands to optimize.

Being spent.

We also had a significant half million dollar upsell with one of our current seven figure customers a diversified technology company, which is continuing to prove up to modernize its customer facing fleet management analytics solution from a legacy on premise offering to a modern cloud based app.

Enabled by our Domo everywhere technology.

This customer is able to provide real time kpis for their transportation customers.

Who can also add data and customize their own reports using domo something to legacy provider could not provide.

Another notable upsell was with a health care.

Company that needed an app for vaccination administration and scheduling for millions of people in a variety of states.

We were able to deliver this highly robust multi layered application in the quarter they needed it.

Using off the shelf components and tools from our dermal application development framework.

Applications.

<unk> built off our data science technology also drove notable upsells in the quarter.

For example, one medical's, one medical technology and professional services company.

Data science application to determine a forecasting model to provider to better predict the likelihood of claims payment in their customer base.

And the luxury retailer created a low code no code app, leveraging our data science technology to help them predict customer churn and lifetime value. So they knew where to focus our resources.

One of the world's leading management Consultancies recently doubled their investment in domo to.

To expand their ability to use domo and more of their client engagements.

They wanted to make sure they have access to a sufficient number of licenses and all the capabilities that domo offers their clients as they continue to identify new use cases, where domo makes sense over the other technologies available in the tool chest.

In addition to these stamps of customer approval.

Industry recognition continues to pour in as you saw in our press release.

And we were highlighted for parity dot Org best companies to work for list for the second consecutive year.

In closing I'm thrilled that as a business we can continue to.

<unk> and the huge opportunity in front of us.

I am excited that we have already added the desired sales capacity in FY 'twenty, two and im confident that our differentiated products and strong execution should enable our growth for a long time to come.

I am very proud of the team for producing accelerating growth this year and given what I'm.

We're seeing in the marketplace I am looking forward to providing you guidance for next year when the time comes and with that I'll hand, it over to Bruce.

Thank you Josh.

I am pleased with our Q2 performance, we continued to execute well and made good progress against our growth initiatives. So.

So let me spend.

A few minutes on those items.

Growth initiatives, we've made good progress on the sales hiring front.

We have met our 20% increased capacity coal and because of the good performance. We have seen from our sales teams. We are building even more capacity through the rest of the year.

On execution, we had higher transaction volumes across both new customers and.

Selling to existing customers in Q2.

In addition to good sales management and adding reps. We believe this is a result of our continued improving position in the market.

As noted by all the industry Acknowledgements, Josh highlighted.

Our North America, corporate business, which focuses on companies with less than $1 billion in annual revenue.

Foreign particularly well.

We attribute this success to excellent sales execution.

A.

Lead generation process that engages well what that target market.

And the Greenfield nature of the opportunity.

Given we provide a full technology stack that it's a superior choice against the tool vendors that offer point solutions in this space.

We delivered Q2 billings of $60 million.

A strong year over year increase of 26% driven by an over 90% gross retention rate.

New customer additions.

And expansion into existing customers.

Net retention remained above 100% it was up slightly from Q1.

And gross retention was also up slightly from Q1.

On a dollar weighted basis, we now have 60% of our customers under multiyear contracts at the end of Q2.

Up from 58% a year ago.

Our remaining performance obligations or RP O with.

Consists of all future revenue under contract.

<unk> 24 per cent compared to the same quarter last year.

And current RP.

P O grew 23% year over year.

Q2, total revenue was $62.8 million a year over year increase of 23% subscription revenue grew 23% year over year and represented 87%.

Of total revenue.

International revenue in the quarter represented 24% of total revenue.

It's up from 23% in Q1.

Our subscription gross margin was 83% up from 80% in Q2 of last year.

Roughly in line with last quarter.

We continue to be successful in managing our data center costs, even as volumes increase.

In Q2 operating expenses increased 16% from last year, primarily as we invest in our sales capacity.

This lag.

Our revenue growth of 23%.

As we are able to get leverage out of our cost structure.

This resulted in an improvement in our operating margin of over 600 basis points from the same quarter of last year.

Our net loss was $9.6 million down from 10.

$10.7 million a year ago, and our net loss per share was <unk> 30 cents.

This is based on 31.9 million weighted average shares outstanding.

Basic and diluted.

In Q2, we reported net cash provided by operations of $2 two.

Yeah.

Our cash balance was approximately $86 million up slightly from last quarter.

Q2 represents the fifth consecutive quarter of greater than 20% billings growth.

And that in turn gives us the confidence to continue to invest in our growth opportunity.

Two minutes as our investments are yielding positive returns.

Now to discuss what we expect in Q3 and the full year FY 'twenty two.

Q3, we're expecting year over year billings growth of approximately 20%.

As we have previously discussed we have many growth drivers in play that could help us achieve an even higher growth rate.

For the current fiscal year.

We expect billings growth of about 21% year over year.

Up from our previous guidance.

Tuning to 18%.

Unexpected we're planning for Q3 operating expenses to increase from Q2 levels as we continue to pursue our growth initiatives we.

We are particularly focused on continuing to invest in sales capacity.

We plan for Q3 and full year adjusted.

Cash provided by operations to be positive.

Now the formal guidance for the third quarter of FY 'twenty, two we expect GAAP revenue to be in the range of $63.5 million to $64.5 million.

We expect non-GAAP net loss per share basic and diluted.

Now 33.

The 37 cents.

This assumes $32.4 million weighted average shares outstanding basic and dilutive.

For the full year of FY 'twenty, two we expect GAAP revenue to be in the range of 252 million to 256.

Representing year over year gross up.

Plenty to 22%.

Non-GAAP net loss per share basic and diluted of $1.31 to $1.39.

This assumes 32 million weighted average shares outstanding.

Basic.

Milly and dilutive.

In closing, we're pleased with our strong performance in Q2, and we believe we remain very well positioned to execute against our growth plans.

With that we'll open up the call for questions.

Operator.

At this time I would like to remind everyone in order to ask your questions. Please press Star then the number one on your telephone keypad.

That is star one on your telephone keypad, we'll pause for just a moment to compile the Q&A roster.

Your first question.

<unk> comes from the line of Sanjay Singh from Morgan Stanley. Your line is open.

Thank you for taking my questions and.

Congrats on the 26% billings growth, which are like accelerated tiny bit off a really difficult comp. So congrats all around there.

Thank Josh.

To pick up on the comment that you can.

Mentioned in her script around trying to get to that 30 handle at the analyst day, Bruce sort of give us the framework on you know the.

The building blocks to get to something like that as we think about over the next 12 months as a sort of related growth just sort of the mid twenty's level what.

Someone like a tactical operational perspective.

That you guys have to sort of execute upon to get to that 30% growth.

Over the next 12 to 18 months.

Yeah, I mean, thanks for that Oh, we're not that far away right.

Put up 26%, we had a 28 earlier this.

Here, we have a couple of 'twenty fives in there.

So I think we're close but.

The one thing that we haven't had as building sales capacity.

And B, we've been adding sales capacity, Bruce Bruce and I, both touched on that but having sales capacity.

And you know the productivity per rep stay in the same ballpark, where it's been.

Ben will definitely put us in that range, where youll see that 30%. So I'm feeling excited and good about that where we've got great managers in place.

The team is performing and we're seeing the deals the marketing organizations generating leads our customer service reps are taking care of customers and.

Seeing the market transform where we went from people not understanding how we're not just.

Visualization or traditional <unk> right now we're modern bi.

And that includes a lot of other things and what that enables all of these apps and that's why I highlighted all those customer examples of the new deals and the Upsells that we got were seeing.

We really have sold into many of our deals.

And we don't have competition, where we're doing that and I think as long as we just do more of that and add some sales heads. So we have more people selling minimal will be seeing a three in front of our growth numbers.

No.

Both are making growth.

Gross easier for John though it sounds like the gross retention rates continue to tick up which is certainly helpful. There. The other thing that sort of caught my ear was the commentary on the corporate market.

It sounds like you've been doing well on winning those strategic accounts you had that big deal that you sort of referenced last quarter, but if.

Seeing corporate market could be kind of that quicker sales cycle and I was wondering in terms of creating that high velocity blocking and tackling business.

Driven by sort of digital lead generation, because that would be sort of a driver going into into calendar 'twenty two.

Because it seems like like lead generation.

If you look like one of the challenges for the company before in terms of investment area, but it seems like that paying off I just wanted to understand like the corporate market opportunity.

Yeah, So we'll continue to.

First in the corporate market you know, it's a it's a good market. Good business. Good average deal size, we are important to those customers.

You know a lot of our customers.

Was.

There may be only have $250 million in revenue, but when you think about companies you know they have $250 million in there, but the real businesses.

And we've become a very important part of their business and we interact with their Ceos and their COO and CFO and CMO, we're an important part of their of that relationship.

Customers I think.

There's plenty of opportunity there for us to continue to grow continue to add reps and it's not just with new logos, which we're seeing the new logo count tick up we you're right are our ability to generate leads has improved.

But the other thing that we've seen a lot of success from is splitting.

And he's out into.

Teams that go out and generate new logos and the teams that worked with our current customers and go out and get up sells and we've been really effective that way. When you look the productivity of those teams it's off the charts.

So we know there's a lot more products and opportunity that we can go in go back in and sell through our current come.

Those.

We have.

Thousands of customers and an opportunity to go back and sell them a lot of products and services. So we feel really good about the opportunities there in the corporate market with.

With Jeff Skiles and running it in his very capable group of managers. So we're pretty excited about that.

Thank you very much.

No.

Your next question comes from the line of Derrick Wood from Cowen Your line is open.

Great. Thanks for taking my questions and congrats another another great quarter.

And a follow up on that new customer generation and I mean, it sounds like you guys have been doing well on your own marketing lead Gen, but Josh.

I know you've talked about.

Some of the bigger deals you've landed recently create you know theres kind of viral market awareness, maybe particularly in the retail vertical.

You know you've got the move that you made up in the Gartner Magic quadrant and so I'm just curious how have those kinds of activities are.

Sliding in and impact of new customer generation and how that's getting you more market awareness.

Yeah, I think it just gives us more credibility with the customer when you go in there we figured out the right way to approach the customer.

And what are the big things that happens people buy from people they like to buy from people that they have confidence in and.

Transaction or walking in to have a lot of confidence because we have a lot of reference customers and we're not just helping one small group, but we're providing apps to these customers that.

Are transforming the way that they run their business and we were just looking at.

A customer that I didn't know a lot about and we delve into a little bit and they're paying.

When are worth a million Bucks a year. They just signed a three year renewal increase their contract by half a million Bucks a year and it's.

We are providing an app to them that help them.

Manage.

All of their employees and they build hours and how to manage all of their employees more effectively and it's through this app that we built for them in this low code.

That's more of a framework that we have so you just hear more and more about those kind of examples.

We had one of the states that we work with that we started out with a COVID-19 relationship and helping them do testing.

And you know it was when something you'd put together over the weekend, we built an app for them over the weekend and we just heard from them two.

Days ago, one of these states we heard that.

Now, we're looking at a multiyear deal with a big upsell and the commentary that they gave to US was we had no idea how easy it was to build apps. There's so many things that we need to accomplish here internally for our state and were starting to look he has a lot more seriously for.

No color applications that we need to build as well.

Theres just a lot of goodness all around we.

We need the extra capacity because we've been limited by the people the number of reps that we've had I think as we build that out we're going to see a lot of goodness accrue.

Fruit of the company.

Great. Thanks, and then maybe on the.

Although I'd just kind of talking about large deal activity and I think the last few quarters, you've highlighted some some nice really big strategic wins and it seems like this quarter was more.

More highlighted around a lot of good <unk>.

<unk> activity, but just and talking about your pipelines and.

Let's see Jan around larger deals how do you feel about your pipeline coverage today versus a year ago on large deals and particularly as we move into the seasonally stronger second half.

Yes, I mean, we'll see what happens in Q4, we got a lot of deals that are cooking, we don't necessarily it's not dominated by large deals.

I guess, maybe a good antibody thing we want to see more large deals out there I think theyre going to accrue to us as we have more success in the enterprise space, but at the same time, when we look at our pipeline.

It's not a big lumpy pipeline it's.

It's a game of numbers here and when there's not big lumpy numbers, then you feel really confident.

But the numbers that youre looking at.

If you look like I'm looking at the top 10 customers that we have right now and just in the last Q.

Quarter, four or five of them, we got Upsells from.

So we're going to continue to see when you look at the average revenue we get from our top 10 customers thats going to continue to grow.

I don't know if there is.

I don't think there's anybody in the top 10, we've maxed out our relationship with them and to the country I'd say most of them.

Maybe have.

110th or.

One may.

Maybe one fifth.

The relationship that we could have with them.

And in some cases 120th.

There's just a lot of upside for us there's a lot of goodness thats going to come.

It's just you know we've got to put it to Bruce to help us figure out what that guidance needs to be in and we're trying to be patient, but we see a lot of goodness coming, especially as we see the sales capacity growing in the productivity, saying it staying in the same ballpark.

Okay, Thanks, well done.

Thank you.

Your next question comes from the line of Jack Andrews from Needham <unk> Company. Your line is open.

Well good afternoon. Thanks for taking my question I was wondering if you could just dig a little bit deeper into the success and differentiation.

So youre seeing in your App business I mean is there way to maybe decouple, what youre doing in apps from the platform itself or is it the power of Domo platform that allows your apps too to be to be really resonating well is there a way to sort of break this apart or is it a combination that's really.

<unk> you.

It's the combination that's helping us I mean every single one of these apps has a data component.

If you want to run a digital business, if you want to run a business and the environment that we're in now that's able to interact with your customers in a digital way interact with your employees in a digital way then you need a data platform first and foremost.

And we have.

The ability to allow you to put all of your data in a location, where we can access at once you can access it and distributed to all the people that need to see that information then our customers buy both start going off like Whoa could I take these components and these elements of data and then create an application and try to distribute this to all.

All of our developers that build on our gaming platform could I distribute this to all of our insurance agents in a way that they interact with their customers can I take this information and distributed to all the citizens there that come in and need services from our state.

And every single one of those apps has a need for data and if you were.

Developers sitting outside and you were tasked with going to do that you would have to start with going to figure out where the data is already happened to know where the data is and.

So when a customer has an opportunity to provide a service or or do something more efficiently.

Something that might cost them 10, or 20 million bucks outside.

They can come to us and Blake.

Can you guys build an app that does this yeah. We got the low code no code environment, you could do it yourself you can have a partner do it we can do it for you and one or 2 million Bucks later.

They've got a fully functioning app, that's customized for their business and that's what we're seeing we talked about a big deal that we closed last year last.

Some ever SEC.

Several million dollar deal that we closed last quarter and the thing that is already moving the dial for them in a dramatic way are the apps that we've been put together for them and they've been helping us put together and it's just taking pieces of data that has never been able to be exposed before.

It's exposing it in <unk>.

Last quarter, and we're already hearing that it's saving it's saving hours of time from everybody that was working on the sales floor across this organization because now instead of them having to go and research data. It's right there on their phone and it's in an app that we put together for them and it's only because they're using our data platform. So it's the combination.

Tie two things the apt framework that we have and then the modern VA platform that allows you to have this be bi leverage at cloud scale and then building. These apps in record time, it's it's really transformational and we were having a conversation earlier today at lunch talking about you know what percentage of the fortune 500, or do you actually think Hasnt has a data platform.

Where they have access to all their data like we do for a couple of really big customers.

Just five.

Six.

That's it right where it's at.

Very beginning of this game, but we have a fully functioning.

<unk> data platform and App framework, and we're going to transform companies.

<unk>.

It's really helpful. Appreciate that maybe just as a follow up question if I may John.

Is there a way to frame the number of strategic C level conversations you are having now versus maybe six to 12 months ago and just how important are those conversations.

For expansion moving forward.

Yeah, I mean that number definitely increases it's not like it's not that dramatic.

<unk> increase because we've always had CX relationships.

A meeting here and we were talking about all the different clouds that are out there and we went around east often raised hands for people that actually log into those applications that.

But the big cloud vendors and some of them not one person on aesop logs into other ones. Maybe one person whoever is direct line responsibility. It was logs into that but you look at our customers, especially like in the corporate market.

Multiple <unk> and almost every single one of our relationships that has access to the data.

Provider in all of our enterprise customers multiple CX those have access and log in and look at that data in many cases multiple times a day. So it's it's an occurrence that doesn't happen anywhere else doesn't happen with any other software vendor that I know of and I.

I think that's why we're excited to be in the position that.

Data.

I don't think the growth profile, yet reflects the opportunity and reflects what we've built because of some of the history.

But we feel really good about where we're getting positioned in and the resources that are coming online with the product that we already have and the customers the customer experiences that we already have.

We're in a good color. Thank you.

Thank you.

Your next question comes from the line of Fats Walraven from JMP Securities. Your line is open.

Oh, great. Thank you and let me add my congratulations.

So Josh what would it take for this business to grow.

I appreciate it much faster.

Well, we'll get into the Thirty's and then we'll tell you.

I think you look at just what Bruce talked about on the analyst day and the growth drivers that are there.

We don't we need like one of those growth drivers to get into the threes and in fact, I don't even know if sales capacity was on there but it.

Grow sales capacity get more sales capacity and were in the threes.

And then you add those growth drivers that Bruce talked about on the analyst day, we get a couple of those things to work and we're faster.

So whether it's.

The partner network I mean, you look at the ecosystem, that's getting created by the App framework that we've built.

There's going to be a real ecosystem around that we have a customer that provides mortgage services and they've built an app that they then go out and sell.

It's not unlike.

<unk> Dot Com and financial force, we have multiple financial forces running around it.

Maybe not your traditional ecosystem.

But they're out there and we look at that and look at the you know the momentum.

They have like we need to see this little more that's a real opportunity we need to go and invest in we have customers that we have products that debt.

In the.

I guess.

And the space that has to do with goal setting and managing an and.

In workflow apps in the workflow space, we have dozens upon dozens of them that have been built and we're taking some of those and turning them into apps ourselves that we're going to sell it and we have been selling into our customer base.

Dozens of times so.

I think you turnaround you're like Oh that did $5 million last quarter of new business, that's a real opportunity and that's we haven't done we're everywhere. We've got 10 more things like that cookie.

And.

We reference Domo everywhere multiple times today and that technology enables so many interesting apps. So I think there's.

Go look at the list from the Analyst day that Bruce gave and those are the things that get us higher than the Three's first want to add anything on that.

I would say were making fantastic progress against a couple of those I mean, one it's certainly sales hiring.

We've really been leaning in sales capacity, we think.

We're in a fantastic position.

To bring reps onboard ramp them and get them to get them to work and.

That's been going extremely well the other thing is certainly just the brand awareness as evidenced by how our position in the market continues to improve and how the market.

The dialogue at the mall.

Market is more around modern b I fast deployment easy adoption flexibility the ability low code no code apps.

That's really moving our way in a big way. So these two alone.

Really put.

Put us in a very good position to keep the growth going and.

And all the other items, which includes partners.

The play running at the office of the CIO marketing effectiveness.

Those were making.

Chrome metal improvements.

So we're seeing improving but any one of those can also I think.

You have a breakout quarter.

And that that would put us in a really good position to kind of keep the growth not only the growth going growing but get more to our aspirational growth rate.

Awesome. Thank you.

Thanks Pat.

Okay.

Question comes from the line of Camille Mills Jarek from William Blair. Your line is open.

Yeah.

Hi, Congrats on the great continued execution and thanks for taking my question.

To better understand your comments around the continued sales capacity investments. So you met your 20% hiring growth targets.

In the quarter and you said you plan to build more capacity through the rest of the year are you still expecting sales head count to be up 20% at the end of the fiscal year or as productivity finally getting to a point, where you can accelerate that pace of ads and how do you decide if that growth should eventually be 25, or maybe even 30%.

Yeah.

So the basic model was to.

On Rep.

Growing but don't count on productivity, increasing in fact, you know.

We kind of model a decrease and we do that for safety reasons, we do that because we.

Our experienced difficulty in the past keeping productivity up with with hiring and we are just going to be very careful about how we come up with our plans and in particularly with our guidance around the plans.

We fully.

I'll put it this way we've charged through 20%.

And it's going to stay that way.

Through the end of the year.

And you heard from Josh the aspirational numbers.

I would say aspirational is even higher than much guidance David.

You can see where we're pointing to and where we want to get the capacity did not have to rely on productivity.

But if we can get both.

If we can get both up and we're really in a good position so.

Keep on going the sales hiring until the point at which we find we're not getting the returns we should be getting and we've yet to find we've yet to find that point.

<unk> that we're going to keep going.

Summer is that.

And we've talked about it before but it's so true and it feels very different we were playing defense there for several years when playing offense. The last 12 months is a lot of fun.

We blew through our sales capacity our initial targets in one quarter.

And.

See that number up 30% 40%.

Depending on where we're at we certainly have the P&L.

Ability to hire more reps and invest in the future. So hopefully that will be able to deal with as we see the numbers play out but it certainly seems like thats going to be the way that's going to be the direction that we're going ahead.

That's.

That's great to hear on the progress.

To hear about those aspirational targets.

If I could just follow up on the partner channel can you just update us on the traction Youre seeing there and who are some of the biggest contributors today and what are the next steps to driving towards our long term target instead of at your Investor day of 15%.

Yeah.

Yeah. So we've we've got.

Our whole group that goes out and works with different partners that we have we talked about a deal that we won.

This this quarter from one of the large.

Consulting organizations without that's out there that might have even bigger bet on domo and those kind of relationships certainly.

Health we had.

More we have more new opportunities in the pipe from snowflake than we've ever had.

And the relationship there continues to evolve where were building relationships with the different managers and sales engineers and sales people on their side.

And we're bringing each other into deals so.

It's good to see that momentum and we'll just keep plugging away at that that's not something that we think that we're going to get a huge benefit out of in terms of our partner ecosystem is going to have a massive impact on our numbers are that we're counting on in the next 12 months, but that's more of the <unk>.

Long play and we're going to keep investing in it we know there's opportunity goodness comes to you as you.

As you get larger in size as you get better rents and recognized by the analyst So.

Dennis is going to accrue to us and we can be patient on that will just continue to invest in it.

That's good to hear thanks, Ken.

Thank you.

There are no more questions.

At this time.

Ladies and gentlemen, this concludes today's conference call.

You for your participation you may now disconnect.

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