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Hello and welcome to the Yext Inc. First Quarter Fiscal 2024 Financial Results Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask a question. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Nils Erdmann, Senior Vice President, Investor Relations. Please go ahead.

Thank you, operator, and good afternoon everyone. Welcome to Yext's Fiscal First Quarter 2024 Earnings Conference Call. With me today are CEO and Chair of the Board, Mike Walrath; President and COO, Marc Ferrentino; and CFO, Darryl Bond. During this call, we will make forward-looking statements, including statements related to our future financial performance, expectations regarding the growth of our business, our outlook for the second quarter and fiscal year 2024, our strategy and estimates of financial and operating metrics, capital expenditures and other indications of future opportunities, as further described in our first quarter earnings press release. These forward-looking statements are subject to certain risks, uncertainties and assumptions, including those related to Yext's growth, the evolution of our industry, our product development and success, our management performance and general economic and business conditions. These forward-looking statements represent our beliefs and assumptions only as of the date made and we undertake no obligation to revise or update any statements to reflect changes that occur after this call. Further information on factors and other risks that could cause actual results to materially differ from these forward-looking statements, is included in our reports filed with the SEC, including in the sections titled Special Note Regarding Forward-Looking Statements and Risk Factors in our most recent Form 10-K for the fiscal year ended January 31st, 2023, and our press release that was issued this afternoon. During the call, we also refer to certain metrics, including non-GAAP financial measures, reconciliations to the most comparable historical GAAP measures are available in the earnings press release which is available at investors.yext.com. We also provide definitions of these metrics in the earnings press release. I will now turn the call over to Mike.

Thanks, Nils, and thanks everyone for joining us today. We are pleased to report solid Q1 results and a strong start to the year. We generated revenue of $99.5 million. Non-GAAP earnings per share of $0.09 and over $14 million of adjusted EBITDA. Our non-GAAP EPS and adjusted EBITDA were the highest in Yext history, and we continue to hit new peak levels of efficiency and profitability. Our performance in the first quarter was a direct result of our continued execution on our priorities, creating value for our customers and improving productivity across the organization. Last year was a turning point for Yext, and we spent the better part of fiscal '23 reorganizing our team, reorienting ourselves around our customers to deliver the highest value and delivering tremendous product innovation. Our first quarter total non-GAAP cost of revenue and operating expenses totaled $89.7 million, down from $106.2 million last year, a 16% decrease. We've hit the ground running in fiscal 2024 and in the first quarter we continued to build awareness for the power of Yext Answers platform and its ability to deliver and generate trusted answers across the full spectrum of digital experiences. Both new and existing customers are realizing how much our platform can enhance their digital transformation by reducing friction, streamlining operations, addressing customer pain points, and driving increased value. Our launches of Content Generation Studio and Yext Chat in beta have been catalysts for more in-depth discussions around Generative AI. As Yext becomes increasingly engaged in strategic discussions about the end-to-end customer journey through the digital experience, our conviction in the long-term opportunity of our platform grow stronger. In the last couple of weeks, we launched two new global campaigns focused on the importance of having a modern, composable best-in-breed architecture that shows the possibilities of what customers can do with our AI-led DXP. Our go-to-market executive team has been in place for six months and we're pleased with the progress we are making. While the full transformation of our go-to-market will take a couple more quarters, we are beginning to see increases in pipeline production and conversions, particularly with smaller enterprise customers. Our mid-market team benefits from shorter sales cycles and less complex integrations and the uptake is a good indicator of how our value proposition is landing with customers. So while it is still early, we believe this momentum will eventually carry over to the larger enterprises as well. Our first quarter performance delivered against the goals we laid out in March and again in April during our Investor Day. We streamlined our operations and demonstrated even greater efficiency and profitability. And in spite of macroeconomic headwinds, we exceeded our revenue, adjusted EBITDA, and non-GAAP EPS targets for the quarter. We generated significant year-over-year profit growth and as Darryl will describe in more detail, we are raising all of our top and bottom-line targets for the year. During our previous earnings call, we mentioned our multi-year plan to transition a portion of our services business to our systems integrator and partner ecosystem. As part of our restructuring plan, we reduced the size of our professional services organization. As expected, the shift in our services strategy had a modest impact on our retention and bookings in Q1. And we expect this to continue as we work through the renewals and build more partnerships throughout the year. The upside to this was felt immediately, and the margin profile of our business has increased significantly. This resulted in non-GAAP gross margin of 79.2% for the quarter, which exceeded our expectations and contributed to our bottom line beat. Overall, we experienced business conditions in Q1 that were similar to the previous several quarters. Our net retention rate for direct on the basis of ARR was consistent with the fourth quarter. We achieved year-over-year growth with a smaller sales organization, which indicates that our emphasis on productivity is having the desired effect. We've made steady progress in Q1, despite a continuing cost conscious demand environment. And as our go-to-market and demand gen engines begin to ramp, we're looking forward to picking up momentum. At the same time our team remains committed to growing our business profitably and managing efficiently. I'm grateful for the commitment and efforts of our entire global team, who are performing well in a challenging environment and staying focused on the significant opportunities ahead of us. With that, I'd now like to turn the call over to Marc.

Thanks, Mike. Back in March, we announced the strengthening of our Answers Platform with new AI-enabled features as part of our Spring '23 release. Our innovative AI-driven solutions and our digital experience platform are driving considerable interest from new and existing customers. We launched a beta version of Yext Chat in February, based on significant demand for Chat from our customers. And we expect that Chat will soon be included in our general release. Our recently launched Studio and Content Generation features have also been well received. And we believe there is significant opportunity for us and our partners with these products. From our conversations with prospective and existing clients, it's clear that Yext is at the center of a massive transformation taking place that can help businesses leverage the power of AI. Our innovations across natural language processing, analytics, and security as well as our leading technology integrations are driving competitive wins in the marketplace and setting the table for sustainable long-term growth. Our innovative composable product platform makes it easier for businesses to enhance their digital experiences, and we have some great customer examples from Q1. During the quarter we expanded our position and added customer wins within the healthcare, financial services, technology, and consumer product sectors. Here are just a few examples. Our go-to-market team executed an impressive win back with a large healthcare provider. This provider was a pre-week Yext customer that churned in 2020. They replaced Yext with another listings provider. And since then has suffered from inaccuracies on Google, a lack of customer support, and an absence of analytics data. They were already familiar with our best-in-class listing solution and further impressed with the new features of our platform such as Verifier, Direct API integrations, and new Apple Map integrations, which won them back in Q1. Another boomerang customer with TGI Friday's. After leaving Yext, they were in talks and close to signing with another listings provider, but after demonstrating the benefits of our composable platform in a head-to-head against a competitor, we were able to win them back. A few months ago, Yext was evaluated against several search providers and selected by Netgear to power the search experiences across all of their global sites, including e-commerce, support community, and documentation. We're looking forward to a great partnership. One of the largest regional banks in the US became another great example of a customer visualizing Yext as a platform, as opposed to a point solution. By showcasing how Yext could not only replace an existing listing provider but also enhance and improve their entire digital experience. We were able to engage with the customer across several branches, loan officers, products and FAQs of the organization. Our team provided quantitative analysis of their digital experience and provided examples of the incremental value that our platform could add relative to their in-house and third-party providers. As a result, the customer chose our platform and our suite of products to work with their existing systems and to manage their experiences across channels and different modalities. Beltone was a competitive win where we were able to demonstrate the advantages of our platform over various point solutions. Beltone had been using in-house tools at a competing listing solution. And they needed a platform that could streamline their existing process and manage the scope of their extensive network. The Yext direct integrations and extensive publisher network helped earn us their listings business and they regarded our other products as compelling opportunities for us to scale in the future. Mathnasium needed a platform that could help them automate their existing highly manual listing process and scale across more than one thousand franchise locations. We were able to win the business over several competitors because of our platform benefits, strong analytics, and superior technology. And finally, one of the world's largest producers of premium [indiscernible] was looking for ways to leverage AI-generated content as part of its marketing effort. Consistent with what we have heard from numerous consumer brands, this customer wanted to explore cost conscious ways to generate content, without having to devote significant internal or external resources. By meeting with several of the company's C-level executives, we were able to showcase how Yext AI-based products and platform capabilities could provide better digital experiences to their customers. Yext is in a strong position, particularly at this moment in time, to help businesses leverage AI-based technology and improve their digital experiences through our composable digital experience platform. I couldn't be more excited about the buzz around AI, that's helping drive awareness amongst C-level executives and helping our teams demonstrate how powerful a partner Yext can be to businesses, particularly in today's environment. Now I'll turn the call over to Darryl.

Thanks, Marc. As our financial results demonstrate, the first quarter highlighted our continued operating efficiency and profitability. Our Q1 revenue of $99.5 million exceeded the high end of our guidance range. Revenue growth was approximately 2% in constant currency and 1% on as reported basis. This represented a year-over-year negative impact of approximately $1.3 million due to FX. While still facing uncertainty in the macro environment, our newly reorganized sales and marketing teams are executing on a prudent and productivity-led growth strategy. We achieved year-over-year growth to sales organization that is much leaner than it was a year ago, which indicates that our emphasis on productivity and accountability is delivering the desired outcome. Our growth in Q1 was driven by continued demand in our direct business. Our customer count for direct excluding SMB increased 5% year-over-year to over 2,970. Annual recurring revenue or ARR was $398.3 million, up 3% year-over-year in constant currency as well as on an as reported basis. Direct customers represented 82% of total ARR. Direct ARR at the end of Q1 totaled $326.1 million, an increase of 5% year-over-year in constant currency as well as on an as reported basis. Third-party resellers which represented 18% of total ARR at the end of Q1 delivered ARR of $72.2 million, a decrease of 6% year-over-year in constant currency, as well as on an as reported basis. As of the end of Q1, our net retention rate was 97% for our direct customers and 92% for our third-party resellers. These rates were consistent with our rates as of the end of Q4, and we're pleased with the level of stabilization that's occurring due to the efforts of our sales and customer success team. Turning to non-GAAP results, which are reconciled to GAAP in our earnings press release, Q1 gross profit was $78.7 million, representing gross margin of 79.2% compared to 76.4% in the year ago quarter. The positive impact to our gross margin was result of the changes we described in Q4, related to the shifting of some of our lower-margin services to our SI and partner ecosystem. These changes as well as continued improvements in our operating efficiency contributed to margin improvements that were better than anticipated. At the time of our Q4 earnings report in March, we expected gross margin improvement throughout the rest of the year that would eventually put us at the high end of our 75% to 80% range. However, we were able to implement organizational changes and recognize cost savings earlier than anticipated. We expect our gross margins for the remainder of our fiscal year to remain at the high end of this range. Our operating expenses in Q1 were $69 million or 69% of revenue compared to $82.9 million or 84% of revenue in the year-ago quarter. The key part of our operating expense discipline has been the realignment of our sales and marketing team and our sales and marketing costs as a percentage of revenue were 40% in Q1 compared to 55% in the first quarter last year. Our Q1 net income was $10.6 million compared to a net loss of $7.8 million in the year-ago quarter. Our Q1 net income per basic share was $0.09 compared to a net loss of $0.06 per basic share in the first quarter of last year. Cash and cash equivalents were $217 million at the end of Q1 compared to $190 million at the end of the fourth quarter. The increase in our cash balance was driven primarily by collections, partially offset by continued share repurchases in Q1, which totaled $4.6 million or 600,000 shares. Since the commencement of the program or share repurchases have totaled $82 million or 14.4 million shares. We intend to continue to maintain a strong balance sheet and cash position going forward and will remain open to buying back our stock at attractive prices. Net cash provided by operating activities for Q1 was $26.7 million compared to $17.9 million in the year-ago quarter and our CapEx was 900,000 compared to $1.6 million in Q1 last year. Turning to our outlook for the second quarter and full fiscal year '24, the macro environment remains challenging and customer behavior across all businesses suggests continued uncertainty. Longer sales cycles, tighter budgets, and additional approval layers are common and our guidance assumes that these weaker macro conditions and their effects will persist throughout this year. As of today, for the second quarter, we expect revenue in the range of $101.5 million to $102.5 million. Adjusted EBITDA in the range of $11 million to $12 million and non-GAAP EPS in the range of $0.06 to $0.07, which assumes a weighted average basic share count of approximately 124.6 million shares. For the full year fiscal '24, we expect revenue in the range of $404 million to $407 million. Adjusted EBITDA in the range of $49 million to $51 million, and non-GAAP EPS in the range of $0.28 to $0.29, which assumes a weighted average basic share count of approximately 125.1 million shares. We are now ready to open up the line for questions.

Thank you. We will now begin the question-and-answer session. [Operator Instructions] Today's first question comes from Tom White with D.A. Davidson. Please go ahead.

Great. Thanks for taking my question guys. Nice start to the year. Two, if I could. Mike, maybe you could elaborate a bit more on kind of how you're progressing on some of the initiatives around sales productivity and building pipeline in some novel ways? And curious sort of where that stands and how you're currently thinking about potentially adding quota-carrying reps this year? And then second question on net retention for direct, same as last quarter, 97%, I think historically it's been sort of 110%, 112% range. Can you kind of refresh our memory or maybe like is the market for an offering like yours today kind of meaningfully different in any way versus when you had retention in that higher range? Just kind of curious whether maybe the offerings were penetrated or anything like that. Any color you can share there would be helpful? Thanks.

Sure. Hey, Tom. So let me take the first one. I'll try to remember the second one while we do that, but you can refresh it for me. So progress on the sales and marketing side, I mentioned this in my comments. We've got an executive team now with Tom and Raianne, who are together have been on in the seat for a little over half the year. And we're clearly seeing progress, I mean, we saw increased productivity in Q1, we saw growth with obviously a smaller expense on sales and marketing, that tells me that, we're getting more from the machine. But I want to be careful that, not to indicate that the machine is -- the work is done there. So the work is clearly ongoing and it takes as I've said before, it takes more than a couple of quarters to not just decide what you're going to fix, but then go ahead and fix it. And then obviously we have the sales cycles to think through as well. So the long-range view on this is, if it takes six to 12 months to fix it, and six to nine month sales cycles, then you kind of hit full steam you know a few quarters down the road clearly. As far as the productivity goes and the quota-carrying reps and we've talked about this at Investor Day, this is the critical analysis for us. So we're doing, we're clearly doing with fewer reps today, similar numbers that we've done historically. And the path to accelerating growth is obviously more sales capacity, but you really want to gate that by seeing the qualified pipeline building. And as I've said before, we're going to be cautious about that because of the macro environment, because of these extensions that we're seeing. But also because we have a lot of -- there's a lot of new things being built here and we really want to make sure we have clear view to the quality of the pipeline that we're seeing. So -- but things are moving, the campaigns that we launched just in the last few weeks are part of a demand-generation strategy, that's highly analytical and geared towards building more demand. And as we see the demand build and we look that pretty granularly, we'll be able to decide where do you -- where we'll increase sales capacity convert into more ARR. Is that make sense? I don't know if we lost, Tom. But I think the second question was on net retention rate and whether anything had fundamentally changed with the business from when we were in the 110% plus range. The short answer to the question for me is, no. That's we want to be there or better. Clearly we're taking, as we've said, we're taking some headwinds on here, with defocusing of certain types of revenue that we talked about last quarter and during Investor Day. So it's having a really positive impact on our gross margins, but we're -- it's not going to help the net retention metric or the gross retention metric in the near term as we make sort of these decisions around revenue that's far less efficient than we wanted to. And I think that's part of the story. But I don't think there is anything structural about the business, if anything with the breadth of our product and the product innovation that we're seeing, there should be more upsell opportunity ultimately and cross-sell opportunity that would drive that number back to and above 110% in the long-run.

That's great. Thanks. I was on mute before, but I appreciate the color.

No problem.

The next question comes from Ryan MacDonald with Needham. Please go ahead.

Hi. Thanks for taking my questions. Congrats and nice quarter. Michael, maybe just to start on the chat -- Yext Chat and some of the new sort of AI-enhanced offerings that are in beta right now. It's great to see, obviously, the early progress there and interest. But as you kind of go through the conversations, are you seeing more demand from sort of net new customers prospective customers? DX or more with the existing, and I guess based on the conversations you've had thus far, is there an opportunity here to sort of buck the broader macro trends of maybe tightening spend to sort of see shorter sales cycles for sort of a hot investment area?

Yeah. So, I think it's early to comment too much on the specific products, Yext Chat is still in beta, Content Generation we just launched, and we feel there's a lot to come in that area. But clearly, these are areas that companies are focused on, figuring out how to make use of generative AI. And as we've said, we've been in that business for -- we've been heavily investing in that business for last five years. And so, what I'm seeing in my conversations with customers is a tremendous amount of interest. And the right amount of reticence also, enterprises need to be careful with how they deploy these technologies. There is a lot of generative stuff showing up and smart management teams are thinking really carefully about this technology because we've all seen there is downside to it. So when you talk about outrunning the headwinds, I do think there are a number of opportunities for us there. One is, we have not had, and I think this is well understood. We've not had a highly tuned and highly efficient demand generation machine or machine that converts qualified demand as effectively as we like to bookings and that's been the source of some of our frustrations on that side. So as we build that versus companies who have had -- really have finely-tuned go-to-market machines, we should have the ability to begin to outrun some of the macro headwinds. But we're staying really conservative on how we project that given our beyond next quarter it's -- we obviously have limited visibility into how the market is going to be and what those uncertainties are going to look like. So, we're a funny mix of optimistic and seeing progress, but at the same time being I think very conservative about what the environment might bring to us.

It's a tricky balance, I get it. But sounds great. Maybe on the second question, I noticed in the prepared remarks there was sort of a heightened level of focus may be on the customer call-outs of a number of win-backs that you had during the quarter. And I'm just curious as you think about sort of the go-to-market strategy, are you placing an increased level of emphasis on winning back previously lost customers and maybe what you're doing there? And then is this really being driven by anything, any dynamics or evolving dynamics within the competitive landscape at all? Thanks.

Yeah. So I'll say some stuff about that and Marc may want to add. So what I'm seeing is a couple of things. So I think when we recommitted ourselves to communicating better about the innovation that was happening through the listings and reviews products in particular, I think we've gotten better at talking about the innovation that's happening there. For a little while I think we lost that thread. Maybe as importantly or more importantly, I think this environment makes it much harder on some of our smaller competitors to do deals that are uneconomic to -- and to service their customers. And so smaller private companies who have been attempting to compete with us here, they are living in a very different capital environment, and they were living in a couple of years ago and even last year. And I think they have a lot less scale on their business. And so, I suspect that one of the things we're seeing is that, where some of these companies where they don't have technological parity, we're competing on services are in a very different financial position now. And so we're going to continue to go after winning back customers and proving to these customers that we have the best set of solutions. And I think the other thing that's happening is in this environment, the consolidation play becomes really important. So being able to offer multiple and package and bundle together, multiple services can help a lot in an environment where a lot of companies are looking for cost savings. And so I'd highlight those three things, and say that, that's driving it. Marc?

Yeah. The only thing that's just really piling on top of what Mike said is that, we saw a few years ago a flight to low-cost, low-quality providers during the sort of some of the economic downturn that happened around COVID. And feel that you get what you pay for. And so a lot of these customers are starting to recognize that the sort of promises made for the price points that were made are just that -- they were -- maybe false promises in some cases. So we're starting to see that recognition, and the recognition of the quality of our products and what that quality does. And so ultimately you start to see that -- you start to see those boomerangs coming back. In addition to that, because we are -- we have expanded our product set and really moves a lot of the existing products forward while adding new products, they see Yext, not just as a point solution for a single product, but actually seeing us as a partner for multiple different areas. As Mike said, the consolidation of the single vendor that can help them in multiple areas. And that was some of the driving reasons behind some of those win backs, as we talked about in the script.

Awesome. Appreciate the color. Congrats again.

Thanks.

The next question comes from Rohit Kulkarni with ROTH MKM. Please go ahead.

Hey, thanks. Couple of questions and a nice quarter. One is on just AI and where are you with getting the products to market and how -- any feedback that you may have heard from customers, that may be looking at demos. I thought the demo that you had at the Investor Day were pretty impressive and very flushed out. So would love to get an update on anything new, with regards to getting real products and real customers' hands from an AI perspective. And then again the follow up on the boomerang customers that was very interesting and thanks for all the color. Maybe talk about how much of an opportunity do you have in terms of getting those boomerang customers back-end versus upsell versus new net new customer wins? As in where, if you have to choose or prioritize over the next six months your renewed go-to-market strategy, how would you prioritize that boomerang versus upsells or cross-sells versus net new wins?

Yeah. So, Marc, can -- we got a -- we lost a little bit of the first question, but I think it was around momentum of the AI products in the market and what we're hearing from customers around some of the newer products like Chat and Content Generation. And Marc can give you, provide some more color on that?

Yeah. It's been really amazing with what's been happening in market right now. I mean we are being helped by an overall interest in AI and overall interest in what Generative AI can do for organizations. What I think is, we're in a really special position, is that what we bring to the market right now is not just hype, it's not just a story, it's actually tangible products, tangible ways that they can leverage Generative AI inside of their enterprise, inside of their companies. And so that has definitely given us an advantage in these conversations, where maybe the initial interest in understanding what AI can do for the enterprise or maybe what got us in the door. But then we quickly turn that into something tactical or something real, as we show them actual product. And we show them how their lives and how the lives of their -- of the teams will be enhanced and increased in productivity that we're seeing across the Board. We will see across the Board by leveraging some of our products. And then on the Chat side, this is very new and natural customer experience is really what's captivating a lot of the imagination of some of the folks that we're talking to about this. And it's such a demonstrable product and it's such a demonstrable set of products. The AI you can show it, you can see it, it's not the sort of a hypothetical. And that has really spurred on a ton of interest. And ultimately when we're in the room though, we of course share the broader set of products that we have, so it becomes a gateway or an entryway for us to have a larger conversation around the entire platform. And there's a lot more on that front coming. We've been doing this for a long time and we've got a really robust product roadmap. So we're -- it's super energizing to have these conversations with customers. I think on the -- your question about focus on boomerang customers versus upsell versus new, it's all of the above, and it's basically prioritizing the customer opportunity. Interestingly, one of the things I think I was engaged with the customer just this week who had been one of our listings only customers who had left us. And one of the customers I talked to were in those early discussions where it became clear that service had been an issue and focus had felt like an issue. This customer opportunity showed up as an opportunity to do everything but listings. And I think somewhat tentatively and as we updated this has been a few years so as we updated the set of products and solutions, I think as we're open with respect to the opportunity to consolidate functions and how far the platform had advanced over the last two or three years. And what was initially a discussion about the non-listing products became a full platform has become a full platform discussion around what would ultimately be a boomerang customer on listings. And so it underscores, I think, what we're seeing anecdotally in the market, which is broadly and you know everybody is talking about it, how can I -- and we're doing it inside our own business, how can I have less software contracts and less shelfware and less things that I'm not using well and instead of focusing on a broader platform of services that work really well together and are built to be integrated with my other systems. And so -- but we will continue to pursue all qualified demand across all those different categories as aggressively as we can.

Great. Thanks, Mike. Thanks, Marc.

[Operator Instructions] The next question comes from Arjun Bhatia with William Blair. Please go ahead.

Hi. Thank you. This is Chris on for Arjun. So the first thing I wanted to talk about was, obviously, the Generative AI space in general is evolving very quickly. Have you seen much buyer hesitation due to just how quickly the space is moving and maybe some of the larger customers wanting to wait kind of let things settle down a bit before making long-term commitments or purchasing decisions. And if so, what's the right message to get past that adoption barrier?

Yes. So Marc will talk about the detail. I'll give you this color. I think keep in mind that ChatGPT, the sort of lightning bolt that changed the market was six months ago, right? And so in normal course, we talked about enterprise cycles in six to nine months. Everyone's talking about the elongation, I think that that's clearly being seen. So we're probably still three months from like the deal cycle is three to six months from the deal cycles in the industry that might have started around Generative AI from actually getting the end of the road. And so I think it's really early to opine on the willingness or reluctance of enterprises to kind of dive into these things. I do think every business in the world has this problem, which is if you fear it too much, you're going to be left behind and your competitors are going to use it. If you don't fear it enough, you're going to make mistakes and you're going to be embarrassed or worse in regulated industries and things like that. And so it's a little bit of the Goldilocks thing where you should have a healthy fear about how to bring these things to your business, but it shouldn't paralyze you from making use of them because if you -- companies who refuse to take advantage of these technologies are going to have a really hard time competing with companies who are modernizing their digital experience platforms. And really focusing on delivering a consumer-grade digital experience. So that's my high-level view and Marc may have specific customer stuff.

Yes. I mean anecdotally, everything that Mike said is backed up by what we're seeing in market right now. There's not -- I'm not seeing a hesitation. I'm not seeing a sort of fear of new technology. What I'm seeing is this the normal sort of buying cycle that you would expect for any piece of technology. We were talking about something like chat specifically, I mean, that is a major channel for digital experience. The cycles on those types of products, they should be thoughtful, they should be sort of span the normal set of steps and piloting phase and the rest of the processes that you need to go through when you're changing in many cases, we're adding a dominant digital experience channel to your line-up. So in many cases, actually, it's quite the opposite is that this technology is now opening up new use cases that maybe before the previous version of chat technology would have never been considered, which is I still think is one of the cooler parts of this that we're seeing is that there's new use cases that are coming up that had really never been considered before.

Okay. So you have another one, Chris?

Yes Thank you. That's really helpful color. One other one was, so it seems like nearly every company that we're talking to -- we're hearing about how quickly product road maps are kind of evolving and shifting to meet the surging demand for Generative AI, even that you've had a bit of a head start in this space? Are you seeing much of that dynamic kind of play out internally for you as well? Just generally, how are you thinking about product strategy in the current market?

Yes. I mean, I think the beauty of being too far ahead of this curve is that it's created probably a lot less disruption internally in terms of having to reprioritize the whole road map and catch up. We're seeing this every day. We're -- everybody seems to have their generative -- lots of companies have never talked about generative until a couple of quarters ago or now have strategies built around it. And we think that's good and we think that, that's drawing attention to it. But we've been at this for a really long time. And we've been able to keep our heads down and deliver really significant product innovation without getting distracted or having to -- I mean we're all -- I think we're always reacting our prioritization around what our customers want and where the market is going. And every good product company does that, but we just have the benefit of having been, I think, trying to break this well down for a number of years that lets us feel really confident that the prioritization we have is good.

Yes. I think the foresight that we had in heading down this path a few years ago is definitely paying dividends right now. So the sort of ebbs and flows of our product road map are mostly driven by customer needs in general. That's been our orientation around product road map for a while. Let's look at the set of things that are -- set of customer problems that are out there that we can help them with, then we will. We have had multiple forms of different types of AI generative AI, different transformer-based models that have been things we've built on part of our road map and [Technical Difficulty] for quite some time. So there hasn't been a lot of radical knee-jerk change because in a lot of ways to sort of the market is coming to us, which has been terrific.