Financial Data and Key Metrics Changes - First quarter ARR grew 11% year over year in constant currency, with total ARR reaching $492.7 million, reflecting a 10% year-over-year growth on a reported basis [24][26] - First quarter revenue was $118.2 million, exceeding guidance by $2.2 million, representing approximately 4% year-over-year growth on a reported basis [25][26] - Adjusted EBITDA for the first quarter was $31.6 million, reflecting a 27% margin, which was above the high end of guidance [27][30] - Gross margin for the first quarter was 80.6%, down from 84.7% in the same period in 2024 [27] Business Line Data and Key Metrics Changes - Subscription revenue was $116.8 million, representing approximately 5% year-over-year growth on a reported basis [26] - The company ended the quarter with 2,398 customers contributing $50,000 or more of ARR, up approximately 10% year over year [26] - Dollar-based net revenue retention was approximately 101% on both a reported and constant currency basis [26] Market Data and Key Metrics Changes - Approximately 43% of revenue was generated outside of North America during the quarter [28] - The company is targeting to reach $750 million in ARR by 2028, driven by security success, scaling go-to-market efforts, and boosting customer expansion [8][24] Company Strategy and Development Direction - The company is focused on enhancing its cyber resiliency platform to address the growing demand for security solutions among small and mid-market businesses [7][8] - Key growth pillars include expanding the go-to-market strategy to capture a broader range of channel providers, including resellers and system integrators [18][19] - The company is committed to CMMC 2.0 readiness to enhance its appeal in regulated sectors [20] Management's Comments on Operating Environment and Future Outlook - Management noted that while there is some elongation in deal cycles, overall demand for cyber resiliency solutions remains strong [42][68] - The company is raising its full-year revenue and ARR guidance based on strong first-quarter results and updated foreign exchange rates [29][31] - Management expressed confidence in the growth potential driven by new product launches and channel expansion efforts [30][31] Other Important Information - The company announced a $75 million share repurchase authorization program, indicating confidence in its business [24] - The adjusted EBITDA outlook for the full year is raised to $134 million to $139 million, representing a margin of 27% to 28% [31] Q&A Session Summary Question: Contribution of AdLumin acquisition to revenue growth - The AdLumin acquisition contributed approximately $21 million of ARR, which should help in calculating the organic growth rate [36] Question: Considerations for seasonality in ARR - Management expects ARR growth to be consistent throughout the year with slight improvements [37] Question: Market spending environment and customer feedback - Demand for cyber resiliency remains strong, although some deals are taking longer to close [42][68] Question: Dollar-based net retention dynamics - Management expects the current retention rate to be a trough, with improvements driven by cross-sell opportunities [46] Question: Reseller traction and growth potential - The company is in the early stages of expanding its reseller network, with expectations for more significant impacts in 2026 [55][57] Question: Impact of FX on revenue guidance - The increase in revenue guidance is primarily related to FX, with constant currency outlook held steady [66] Question: EBITDA margin expectations - The focus for 2025 is on growth acceleration, with expectations to return to low 30s EBITDA margins in 2026 [71]

Financial Data and Key Metrics Changes - First quarter ARR grew 11% year over year in constant currency, with total ARR reaching $492.7 million, reflecting a 10% year-over-year growth on a reported basis [24][25] - First quarter revenue was $118.2 million, exceeding guidance by $2.2 million, representing approximately 4% year-over-year growth on a reported basis [25][26] - Adjusted EBITDA for the first quarter was $31.6 million, reflecting a 27% margin, which was above the high end of guidance [26][27] - Gross margin for the first quarter was 80.6%, down from 84.7% in the same period in 2024 [26] Business Line Data and Key Metrics Changes - Subscription revenue was $116.8 million, representing approximately 5% year-over-year growth on a reported basis [25] - The company ended the quarter with 2,398 customers contributing $50,000 or more of ARR, up approximately 10% year over year [25] - Dollar-based net revenue retention was approximately 101% on both a reported and constant currency basis [25] Market Data and Key Metrics Changes - Approximately 43% of revenue was generated outside of North America during the quarter [28] - The company is targeting $750 million in ARR by 2028, driven by three growth pillars: driving security success, scaling go-to-market efforts, and boosting customer expansion [7][8] Company Strategy and Development Direction - The company is focused on expanding its go-to-market strategy by partnering with a broader range of channel providers, including resellers and system integrators [18][19] - The launch of new security capabilities and the growth of channel partners are seen as key components of the company's innovation and growth strategy [33] - The company is committed to CMMC 2.0 readiness to enhance its appeal in regulated sectors [20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the demand for cybersecurity solutions, noting that the need for cyber resiliency is a must for businesses [42] - Despite some anecdotal evidence of longer sales cycles, the overall demand remains strong, and the pipeline is robust [42][70] - The company raised its revenue and ARR guidance for the full year, reflecting strong first-quarter results and updated foreign exchange rates [29][30] Other Important Information - The company announced a $75 million share repurchase authorization program, indicating confidence in its business [24] - The adjusted EBITDA guidance for the full year was raised, with expectations of $134 million to $139 million, representing a margin of 27% to 28% [31] Q&A Session Summary Question: Contribution of AdLumin acquisition to revenue growth - The AdLumin acquisition contributed approximately $21 million of ARR at the time of acquisition, which should help in calculating organic growth rates [36][37] Question: Considerations for seasonality in ARR - Management expects ARR growth to be consistent throughout the year, with slight improvements as the year progresses [38] Question: Market spending environment and customer feedback - Demand for cybersecurity solutions remains strong, with no significant changes in metrics, although some deals are taking longer to close [42][70] Question: Dollar-based net revenue retention dynamics - Management expects the current retention rate to be a trough, with improvements driven by cross-selling opportunities [45][47] Question: Reseller traction and growth potential - The company is in the early stages of expanding its reseller network, with expectations for more significant impacts in 2026 [56][58] Question: Integration of offerings into a single platform - The company is focused on automating workflows and integrating its offerings to enhance efficiency and security for customers [96][100]

Financial Data and Key Metrics Changes - Fourth quarter revenue grew 7% year-over-year in constant currency, with full year 2024 revenue growing 10% at constant currency [8][39] - Adjusted EBITDA for the fourth quarter was $38.1 million, reflecting a 32.7% margin, while full year adjusted EBITDA was $169.4 million, reflecting a 36.3% margin [9][43] - Annual recurring revenue (ARR) as of December 31, 2024, was $482 million, growing 10% at constant currency [8][42] Business Line Data and Key Metrics Changes - Cove Data Protection remains the largest revenue-generating product, protecting over 180,000 businesses and outpacing total company growth [17][30] - The acquisition of Adlumin has positioned it as one of the two highest booking products since its acquisition [15][16] Market Data and Key Metrics Changes - Approximately 45% of revenue was generated outside of North America in the fourth quarter, and 46% for the full year [46] - The company is focusing on expanding its presence in the North American reseller channel and international markets such as the U.K., DACH, and Australia [33][34] Company Strategy and Development Direction - The company aims to expand its security leadership, scale its go-to-market strategy, and elevate customer experience in 2025 [22][34] - The strategic acquisition of Adlumin is expected to enhance the product suite and create new growth avenues in the high-demand security market [38][39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's position for growth in 2025, citing strong demand in the market and a robust business model [58][61] - The company anticipates some headwinds in the first half of 2025 due to long-term contract commitments but expects acceleration in the second half [108][110] Other Important Information - The company transitioned from less than 10% of revenue from annual contracts to over 50% in 2024, which is expected to improve customer retention [19][20] - The company is investing in technology and partnerships to enhance its serviceable addressable market and unlock significant growth potential [21][22] Q&A Session Summary Question: What was the revenue contribution from Adlumin in Q4? - The revenue contribution from Adlumin in Q4 was approximately $2.5 million from the acquisition date of November 20 through the end of the year [65] Question: Is there an expected headwind or benefit from moving customers to annual contracts? - The initiative will continue, with expectations for a natural blend up over time, but no significant uptick like in 2024 is anticipated [68] Question: How has engagement been on the partner side for Adlumin? - Resellers have been enthusiastic about the acquisition, seeing it as a partnership that provides a one-stop shop for various offerings [74] Question: What competitive landscape does Adlumin face? - Adlumin is seen as a strong competitor due to its cloud-native, AI-driven technology and endpoint-agnostic capabilities, which differentiate it from larger competitors [80][82] Question: What is the expected organic growth rate for 2025? - The company expects higher single-digit growth rates, with a focus on scaling new customer acquisition motions and leveraging the Adlumin acquisition [112] Question: How is the company exposed to the U.S. federal government market? - The company does not have direct visibility into the end customers of MSPs but expects to remain diversified and not significantly impacted by government market dynamics [127][128]