BOX - NYSE

Ladies and gentlemen, good afternoon, and thank you for standing by. My name is Abby, and I will be your conference operator today. At this time, I would like to welcome everyone to the Box Third Quarter Fiscal 2025 Earnings Conference Call. [Operator Instructions] Thank you. And I would now like to turn the conference over to Cynthia Hiponia, Vice President of Investor Relations. You may begin.

Good afternoon, and welcome to Box's third quarter fiscal 2025 earnings conference call. I'm Cynthia Hiponia, Vice President, Investor Relations. On the call today, we have Aaron Levie, Box Co-Founder and CEO; and Dylan Smith, Box Co-Founder and CFO. Following our prepared remarks, we will take your questions. Today's call is being webcast and will also be available for replay on our Investor Relations website at boxinvestorrelations.com. Our webcast will be audio only. However, supplemental slides are now available for download from our website. On this call, we will be making forward-looking statements, including: our fourth quarter and full-year fiscal 2025 financial guidance and our expectations regarding our financial performance for fiscal 2025 and future periods, including gross margins, operating margins, operating leverage, future profitability, net retention rates, remaining performance obligations, revenue and billings and the impact of foreign currency exchange rates and deferred tax expenses; and our expectations regarding the size of our market opportunity, our planned investments, future product offerings and growth strategies, our ability to achieve our revenue, operating margins and other operating model targets, the timing and market adoption of and benefits from our new products, pricing models and partnerships, the proceeds from the sale of our data center equipment, our ability to address enterprise challenges and deliver cost savings for our customers, the impact of the macro-environment on our business and operating results and our capital allocation strategies, including potential repurchase of our common stock. These statements reflect our best judgment based on the factors currently known to us and actual events or results may differ materially. Please refer to our earnings press release filed today and the risk factors in documents we file with the Securities and Exchange Commission, including our most recent quarterly report on Form 10-Q for information on the risks and uncertainties that may cause actual results to differ materially from statements made on this earnings call. These forward-looking statements are being made as of today, December 3, 2024, and we disclaim any obligation to update or revise them should they change or cease to be up-to-date. In addition, during today's call, we will discuss non-GAAP financial measures. These non-GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from, our GAAP results. You can find additional disclosures regarding these non-GAAP measures, including reconciliations and comparable GAAP results in our earnings press release and in the related supplemental slides, which can be found on the IR page of our website. Unless otherwise indicated, all references to financial measures are on a non-GAAP basis. With that, let me turn the call over to Aaron.

Thank you, Cynthia, and thanks, everyone, for joining us today. It has been an exciting period for Box. For the past several quarters, I have talked about our intense focus at Box on embedding AI into our platform to revolutionize our customers' ability to create value from their content. Our strong financial results in Q3 reflects continued growth in customer demand for Box AI. In Q3, our revenue grew 5% year-over-year or 6% in constant-currency and RPO growth of 13% year-over-year. We delivered record gross margin of 82% and our focus on operational discipline drove record operating margin of 29%, up 440 basis points from a year ago. Box AI and Enterprise Plus drove strong customer demand in Q3. Examples of customers who chose Enterprise Plus to gain access to Box AI include one of the largest advertising agency groups in the world expanded their use of Enterprise Plus within the company as they rolled-out Box AI and Hubs company-wide. With Box AI, they are able to summarize documents quickly, sharing valuable insights with clients, and they are able to create hubs for each department of the business to better organize and get value for their critical business data. A U.S. federal agency upgraded to Enterprise Plus to support secure collaboration with Box Shield and to support hubs and AI use cases related to internal and external collaboration around inspections. And an American digital marketing and media company that has been a Box customer for 10 years upgraded to Enterprise Plus, driven by our innovation with Box AI and Hubs. With Hubs/AI, they are now able to provide their sales teams with quick and easy access to resources as well as enable marketing to streamline their content creation process. We had a strong quarter overall and executed well on both the top- and bottom-lines, proving that our disciplined approach to profitable growth creates value for both our customers and our shareholders. And what I'm most excited about is the journey that now lies in front of us. At BoxWorks, we rolled-out key elements in our drive to create a new era of Intelligent Content Management, which will be a major driver for growth going forward. First, we unveiled the most transformational product line-up in Box history. Second, we launched Enterprise Advanced, a higher tier Suites plan for customers to address even more complex and powerful enterprise use cases. And finally, we announced deeper integrations and relationships with key technology partners like Anthropic, OpenAI, Google, and we hosted hundreds of partners from all of our key regions who came to spend time with our customers and teams and dove into learning about how to build on Box and leverage Box AI. With Intelligent Content Management, businesses of all sizes are able to unleash the full value of their content and leverage the data within it to drive innovation, automate content-based processes to accelerate their businesses and secure their most important information, both more easily and at a lower cost compared to legacy ECM systems. To deliver on the full potential of Intelligent Content Management, at BoxWorks, we announced ground-breaking intelligent workflow automation capabilities, including Box Apps to enable customers to create no-code apps for any content-based business process inside of Box, leveraging AI-powered metadata views, custom dashboards and more. Prior to having Box Apps, any enterprise that wanted to customize their Box user experience to power a critical workflow had to do this through our APIs. Now, building on the technology we acquired from Crooze earlier this year, Box Apps offers an additional way for customers and partners to rapidly customize and automate content-based workflows for any line of business or industry-specific use case, like contract management, digital asset management, invoice processing, loan document management and more. Further, we announced Box Forms, which extends our workflow capabilities and allows customers to collect structured data in any workflow around content; Box Doc Gen for the ability to automatically generate documents, such as invoices or contracts; and Box Metadata Extract and APIs to help intelligently extract and create structured data from documents to help power Box Apps as well as link data from Box to other systems tied to these critical workflows. This is the precursor functionality to our integrated Alphamoon technology that we plan to launch in FY '26. When combined, these workflow automation capabilities tied to our advanced data security and compliance, open platform and world-class end user experience allow enterprises to power a wide range of complex content-based workflows on Box with little customization or developer experience necessary. This dramatically expands the market opportunity for Box and lets us more successfully create value across more and more software categories. In addition to these intelligent workflow capabilities, Box also announced major features to further our leadership in Intelligent Content Management. These include new advancements with AI to help customers interact with their content in new ways through hubs and multi-document querying inside its folders and the ability to create custom AI agents that can be tuned to the specific needs of an enterprise or team through Box AI Studio, which also lets you manage and create these agents with many more third-party AI model providers, including the GPT family, the Gemini family and the Anthropic family of models, with additional models coming in the future. And we announced Box Archive, which allows customers to manage large amounts of content, think petabytes and hundreds of millions or billions of files that don't need to be actively engaged by end users for compliance, regulatory or data governance purposes. And with Box Archive, we can handle more of our customers' most important compliance and security use cases without trading off performance or user experience. At BoxWorks, we were also honored to have as keynote speakers the CEOs of Anthropic, Google Cloud, Slack and

Thanks, Aaron. Good afternoon, everyone, and thank you for joining us today. Q3 was a strong quarter for Box, with revenue, operating margin and EPS landing at or above the high-end of our guidance. We achieved record gross and operating margins this quarter, which has enabled us to continue making targeted investments in our Intelligent Content Management platform, while also returning capital to shareholders. In Q3, we delivered revenue of $276 million at the high-end of our guidance, up 5% year-over-year and 6% in constant-currency. We now have approximately 1,900 total customers paying us at least $100,000 annually, up 8% year-over-year. Our Q3 Suites attach rate in large deals was 83%, an improvement from 79% in Q3 of last year. Suites customers now represent 59% of our revenue, up considerably from 51% a year ago. As Aaron discussed, launching Enterprise Advanced next month will enable all of our customers to power intelligent content workflows across their businesses. We ended Q3 with remaining performance obligations, or RPO, of $1.3 billion, a 13% year-over-year increase and 14% in constant-currency. Our strong RPO growth was driven by continued improvement in customer contract durations. Consistent with prior quarters, we expect to recognize roughly 60% of our RPO over the next 12 months. Q3 billings of $265 million were up 4% year-over-year and up 3% year-over-year in constant-currency. Q3 billings were impacted by a roughly 100 basis points or $3 million headwind from FX versus our prior expectations. We ended Q3 with a net retention rate of 102%, in-line with our expectations and consistent with our prior quarter. Our annualized full churn rate continues to remain strong and stable at 3%, demonstrating that the full value of Box's platform is driving customer stickiness. We continue to anticipate exiting FY '25 with a net retention rate of roughly 102%. In Q3, we delivered record gross margin of 81.9%, up 560 basis points year-over-year. In Q3, we completed the sale of the remaining data center assets that we noted on our last earnings call, which benefited Q3 gross margin by approximately 70 basis points. Q3 gross profit of $226 million was up 13% year-over-year, substantially greater than our revenue growth rate. This past quarter, we continued to generate leverage across the business, delivering record operating income of $80 million, up 24% year-over-year. Q3 operating margin of 29.1% was up 440 basis points versus a year ago, even as we absorbed a negative impact from FX of roughly 90 basis points. The upside in our operating margin relative to our expectations was due in-part to the pacing of H2 expenses. This includes a shift in sales and marketing expenses to Q4 to support our first in-person BoxWorks in several years and the timing of hiring being more back-end loaded. As a result, we delivered another record EPS result of $0.45 in Q3, despite absorbing a negative impact from FX of approximately $0.02. EPS was up $0.09 year-over-year and above the high-end of our guidance of $0.42. I'll now turn to our cash flow and balance sheet. In Q3, we generated free cash flow of $57 million, down 2% from Q3 of FY '24. We generated cash flow from operations of $63 million, down 13% year-over-year. We ended the quarter with $699 million in cash and equivalents. In September, we successfully raised $460 million through a convertible debt offering. A portion of these proceeds were used to pay for fees associated with this transaction to purchase a capped call and to repurchase approximately $140 million of the outstanding convertible notes due in calendar 2026. As a result, net proceeds from this offering were approximately $205 million. Additionally, in the third quarter, we repurchased 1 million shares for approximately $30 million. As of October 31, 2024, we had approximately $95 million of remaining buyback capacity under our current share repurchase plan. In addition to our robust stock repurchase program, we will continue to leverage our strong balance sheet and consistent cash flow generation to invest in key growth initiatives and to fund strategic tuck-in M&A opportunities, enhancing and accelerating our Intelligent Content Management platform product roadmap. With that, let me now turn to our Q4 and full-year guidance. As a reminder, approximately one-third of our revenue is generated outside of the U.S., with roughly 65% of our international revenue coming from Japan. Since we last provided guidance, the U.S. dollar has strengthened versus the yen and the following guidance includes the expected impact of FX, assuming current exchange rates. As a reminder, the seasonality of our Q4 expenses will differ from the past few years due to BoxWorks held in-person in November. This event will impact Q4 sales and marketing expenses by approximately $3 million. For the fourth quarter of fiscal 2025, we expect Q4 revenue to be approximately $279 million, representing 6% year-over-year growth. This includes an expected headwind from FX of approximately 90 basis points, representing an impact of roughly $2 million versus our previous expectations. We anticipate our Q4 billings growth rate to be in the low-single-digit range. This includes an expected tailwind from FX of approximately 80 basis points. We expect our Q4 non-GAAP operating margin to be approximately 27.5%, which includes the previously mentioned BoxWorks expenses as well as an expected negative impact of approximately 100 basis points due to FX. This represents an 80 basis-point improvement year-over-year and a 180 basis-point improvement in constant-currency. We expect our Q4 non-GAAP EPS to be approximately $0.41 as compared to $0.42 a year ago. This includes an expected headwind of approximately $0.02 from FX and $0.01 from non-cash deferred tax expenses. Weighted average diluted shares are expected to be approximately 151 million. For the full fiscal year ending January 31, 2025, we anticipate revenue to be approximately $1.09 billion, representing approximately 5% year-over-year growth and 7% growth in constant-currency. We now expect an FX headwind of roughly 190 basis points versus our previous expectations of 170 basis points. We now expect our FY '25 billings growth rate to be approximately 4%. We now expect FX to have a negative impact of approximately 140 basis points on this year's billings growth versus our previous expectations of approximately 30 basis points. This represents an incremental $12 million in FX headwinds since we last provided guidance. Our FY '25 gross margin expectations remain approximately 81%, a year-over-year improvement of 360 basis points. We are raising our FY '25 non-GAAP operating margin guidance by 50 basis points to be approximately 28%, representing a 330 basis-point improvement year-over-year. We now expect FX to have a negative impact on operating margin of roughly 140 basis points versus our previous expectations of 130 basis points. We are raising our EPS expectations for the full year. We now expect FY '25 non-GAAP EPS to be approximately $1.70, representing a 16% increase versus $1.46 in the prior year. This includes the $0.05 headwind from the deferred tax expenses that I noted previously as well as an expected FX headwind of $0.13, which is $0.01 higher than our previous expectations. Weighted average diluted shares are now expected to be approximately 149 million. We are proud of the strong results we delivered in Q3, including record gross and operating margins and sustaining a double-digit RPO growth rate. Going forward, we're excited to roll-out the innovative new products that we unveiled at BoxWorks, enabling enterprises to realize the full value of their content and transform how they work. Our proven cost discipline and operational excellence, allow us to strategically invest in the massive opportunity ahead of us, as we remain focused on delivering long-term shareholder value. With that, Aaron and I will be happy to take your questions. Operator?

Thank you. [Operator Instructions] And so, we will take our first question from Steve Enders.

Folks, we got accidentally cut-off. So, hi, Steve.

Oh, I apologize. I haven't opened Steve's line yet. Our first question comes from Steve Enders with Citi. Your line is open.

Okay. Great. Thanks. Can everyone hear me?

Yes.

Okay. Perfect. I guess, I just want to start on, I guess, the AI solutions that have come out and just kind of get a better sense for kind of what the earlier - the early feedback has been on the potential contribution for that, and maybe how that maybe changes some of the legacy ECM footprint potentially moving to the cloud? Like, is there a view for the ability to maybe capture some of those legacy use cases out there?

Yes. So there's sort of two big categories right now that we are talking about publicly. The first is the core Box AI interactions that we've already launched with single documents or hubs. So this is where you can really kind of talk to your data for the first time ever, get summarization of information quickly, get insights from leading AI models around your content. So this is a breakthrough capability for end user productivity. It just makes it easier to work with your content and then with hubs, lets you really kind of search across and ask questions of a large amount of data. So that's been the initial catalyst of growth with Enterprise Plus, because those capabilities are included on an unlimited basis for Enterprise Plus. And that's been certainly encouraging customers to double down more, with Box and move from legacy systems. I think the biggest kind of breakthrough in terms of replacing legacy enterprise content management environments will be some of the initial announcements that we had at BoxWorks, where you can begin to extract metadata from your documents using AI. And then once you have that metadata, or structured data in our system, you can begin to automate workflows within Box much more easily and more seamlessly. So being able to, for the first time ever, at really kind of any kind of scale, extract any type of structured data from contracts, or invoices or digital assets or loan agreements - all of that data going into Box's, metadata store. Then lets you either turn those into Box Apps, which gives you custom metadata views, or automated workflows, or even embedding that data into third-party applications, like Salesforce or other systems. So that really kind of goes at the heart of traditional enterprise content management, because you have so many of these environments where customers need to be able to manage their documents in a compliant way. Tied to a workflow and the legacy approaches, to getting the metadata out of those documents, either was through traditional RPA systems, OCR technology, or you had to do a lot of it by hand. So AI really is the first time that we can do that at scale in a much more accelerated fashion. And I think that will drive much more growth of these kind of traditional ECM takeouts.

Okay. Great. That's great to hear. And then maybe shifting gears a little bit just on the billings outlook for Q4. I guess are there any things that we should be keeping in mind as we think about that low single-digit growth rate that we're talking about now for Q4? And I guess, secondarily, as we think about that potentially flowing through into fiscal '26. Can you just kind of help us maybe think about the moving parts there between maybe that low single-digit growth rate you're talking about there, versus the mid-single-digit revenue growth we're at today versus the RPO growth. And more in like the mid-teens range, and how we should kind of think about all that for next year?

Sure. So I would say that the Q4 billings expectations that we have are less a function, of anything unusual that we expect to see this quarter, and more a function of a pretty difficult comparison from a year ago. So as a reminder, Q4 of last year, we delivered 10% constant currency billings growth, which included both strong early renewals and an impact from a couple of multiyear customer prepayments. So that creates a bit of a just challenging side from a comparison point of view, if you think about the overall trajectory both with Q3. And then Q4 is expectations, our expectations for the business really haven't changed over the last few months, and kind of in constant currency, reiterating that billings outlook that we had on our last call. So I feel good that when you look at both the growth in short-term RPO overall RPO growth, with kind of demonstrate the underlying momentum and adjusting for some of those factors a bit better, feel confident in the trajectory that we're on.

Perfect. Thanks for taking the question.

And your next question comes from the line of Brian Peterson. I apologize - yes, Brian Peterson with Raymond James. Your line is open.

All right, thanks guys. I will take the question. Aaron, it's great to hear about the positive early feedback from BoxWorks. I'm curious on how we should be thinking about that as you head into a big business and renewal period in the fourth quarter, you have some products launching in January. Does that change the seasonality of how some customers may be buying or expanding? Obviously, the functionality is much better, but just curious how we should be thinking about that potentially impacting purchases or renewals in the fourth quarter?

Yes. So I'd say maybe two things that we're focused on. One, because obviously, Q4 is really a period where there's been a lot of pipeline built throughout the year. A lot of those deals are going to be Enterprise Plus just given the momentum that we've had with many of these customer conversations. So - that will be certainly the bulk of the revenue, or new bookings that come in, in Q4 will continue to be on Enterprise Plus. Enterprise Advanced gives us another ad back for customers where we have had use cases come up, around more structured metadata extraction, or custom applications and even the archive functionality is. We're having a lot of conversations around. And so to the extent that our sellers can fit those into conversations, and we can ensure that we can get those deals done in Q4. I think we'll see that in a number of cases. But as we've kind of called out Enterprise Advanced is much more of a driver for next year's revenue growth rate. And I think you'll still see most of the focus on Enterprise Plus in Q4. We didn't want to get too much distraction on that. But based on the early signals that we're seeing from customers, there's certainly a lot of energy on Enterprise Advanced. It's absolutely the most amount of value and functionality we've ever packed into a plan at once. So as you'll recall from Enterprise Plus, it was sort of incrementally a build over a multiyear period. And so Enterprise Advanced, really right out of the gate, is going to have just a tremendous amount of advanced capabilities. That really let us go and accelerate the move off of legacy enterprise content management systems, and get into more categories. So again, you'll see some of this in Q4. But really, the focus is going to be for next year's driving your growth.

No, that makes sense. And Dylan, maybe a follow-up for you. The NRR, 102%, the last two quarters, you're guiding for something similar in the fourth quarter. Is it fair to say that we've seen the bottom of that metric? Or any color you could add there? Thanks guys.

Yes. So as we said on our last call, we still expect that to be a bottom out. And then over time, both we see the impact of our newer offerings start to flow through the model. And then at some point, kind of macro headwinds subsiding, both of those should benefit NRR, and then our overall growth rate over time. So, we do expect from this level at the bottom here, to trend gradually upward over time going forward.

Thanks.

And your next question comes from the line of Pinjalim Bora with JPMorgan. Your line is open.

This is [Jaydon] on for Pinjalim. Thanks for taking the question. With the new SKU, how broadly applicable might it be within your customer base?

Yes. So we're - with the new SKU, there's actually sort of something for everyone at the moment. I think each customer will sort of value the capabilities a little bit differently. So it's sort of hard to peg a particular percentage on the functionality. But between AI Studio for anybody who's really pushing their AI efforts internally, and AI transformation within their enterprise. The AI Studio and the ability to change your models and incorporate them in your workflows more deeply, that's going to be incredibly important. For customers that for years have asked us for contract management or digital asset management or invoice processing or quality management systems, or more advanced document management, the Box Apps functionality is going to really cover all of the bases around that. And then finally, we have a number of advanced security, compliance and governance features with Box Archive and other capabilities that we're working on. So when you kind of take that collection, there will be some customers that want all of that and our - we'll jump right in. Some customers will sort of value one or two of those capabilities as well, and that will be relevant for them. So not calling out a specific percentage, but this plan is certainly intended to be broad-based and really, again, getting our customer base into the future with Intelligent Content Management. Now they'll still take a couple of years to - as that works through the system. But we expect to see really strong outcomes as that even rolls out in the near term. But I think you've seen how these products roll out to work with Enterprise Plus. And again, this is going to be a core focus for us over time.

Great, thanks. And do we know anything incremental about pricing yet?

Yes. So we do expect to achieve somewhere between a 20% to 40% uplift for E-Advanced relative to where Enterprise Plus is priced, on kind of a like-for-like volume basis. So certainly not yet generally available. But based on the conversations we've been having with customers, some of that early feedback and the analysis we've done, that's where we expect to land. And then over time, we'll share more in terms of what we're seeing in the market.

Thanks for taking the questions.

And your next question comes from the line of Josh Baer with Morgan Stanley. Your line is open.

Thanks for the question. So the list of new products and capabilities quite compelling from a platform perspective, very dynamic like transformational period of time. I guess, Aaron, wondering what are you most excited about, specifically from the business impact or opportunity perspective? And then a follow-up for Dylan, like based on Aaron's answer, how do you map that over to the financial impact? And does that align with what could have the most impact on the model? Thanks.

I feel like I want to give a new answer just to throw Dylan off. But I will - a little bit of it is redundant to what I just kind of spoke about in the prepared remarks. But I think the best way to think about it is, Box has really since we started the company, the core foundational capability set was secure collaboration, content management, end user productivity. Super powerful, obviously got us to $1 billion plus in revenue. And then the moment you wanted really advanced customization, we have a set of really powerful APIs that you can embed into your applications and your workflows, and that's incredibly powerful and that will remain a major driver for us going forward. But we had this CASM in between those two things, which is customers coming to us and say, I don't want to just manage my documents inside of folders. And have to go kind of peruse those folders or search through those folders for a contract management workflow, or I have 1 million digital assets for a marketing campaign, and all of my retail stores. I don't want to just have to go and click through all of those folders and places to find the content that I'm looking for, or an invoice process where you have hundreds or thousands of documents coming in. People don't want to have to just go and work through that in a manual way. And so unfortunately, we've had this sort of dichotomy where we have a really simple end user application or really powerful APIs, but that requires time and customization. With Box Apps and the reason we acquired Crooze was we said, well, wait a second, if you look at, let's say, Salesforce with Force.com and then the app exchange and then Lightning. Customers and partners can quickly build any type of CRM application, or with ServiceNow, you have the App Engine Studio, where you can quickly build any kind of workflow technology, or with Workday Extend you can build applications within the HRIS environment. And so we sort of sat around and said, well, where is our version of that where a customer comes in and they say. I want to be able to quickly build an experience within Box that, powers the business processes for every line of business that I have that deal with content. And again, Crooze had been building up in our ecosystem kind of delivering that type of capability for our customer base. And between the Crooze acquisition and the timing around that, as well as coupled with really the advancements in AI. We said, okay, this is the moment where we can finally deliver that type of solution. We can have an AI-powered, no code application builder to power workflows in the enterprise, backed by the security, compliance, data governance, unlimited storage platform capabilities that we have that, give us really kind of a superior offering. So that's what I'm most excited about. Obviously, this is all kind of culminating in this idea of Intelligent Content Management and BoxWorks for us was just the milestone event to put a flag in the ground and say, the world we are going to be the most transformational platform for working with your content. But for us, it opens up hundreds or thousands of new use cases that we can go after. So certainly, over the next couple of quarters, we'll share some updates around how this is going to evolve. But as you can imagine, internally, our plans for this are quite ambitious.

Yes. And then in terms of impact on the model, I think I'm going to share Aaron's excitement didn't throw me off too much on that. But I think the answer, is there's really no single component just as today, we talk about impact of suites and Enterprise Plus versus - or rather than any single component. So I would say that it's really just about the overall impact. I mean, certainly, based on the expectations that we laid out. We do expect this to be a key contributor, and kind of reason that we're confident in seeing a higher growth rate over time, as well as just as we've seen with Enterprise Plus the opportunity to further improve our customer economics, both in terms of the stickiness and with the higher price, flowing through to the bottom line. And so, do you expect it from a business point of view, to be probably the biggest driver of the overall growth that we expect to see in the coming years, but it's hard to parse out what Aaron is most excited about and map that directly to a specific growth number.

Yes. Let me just say one more thing just kind of a fun anecdote. We studied the customers that had leveraged Crooze and the metrics and KPIs on these customers were just incredibly powerful, as compared to any other kind of cohort we have. So the retention rate of these customers, their overall ACVs. So these were customers prior to Box owning the technology that we're embedding Box even more deeply into their business processes. Because the Crooze technology let them construct these custom dashboards and workflows and metadata views. And so, now we're very excited about the ability to now bring this out to all of our customers at a very different scale, and level of seamlessness. So that's what Enterprise Advanced is all about.

Great. Thank you.

And ladies and gentlemen, that concludes our question-and-answer session. I will now turn the conference back over to Cynthia Hiponia for closing remarks.

Thank you, operator. Thank you, everyone, for joining us here today, and we look forward to chatting with you again, on our next earnings call.