Financial Data and Key Metrics Changes - Total ARR for the third quarter was $528.1 million, reflecting a 14% year-over-year growth on a reported basis and 13% on a constant currency basis [29] - Total revenue reached $131.7 million, exceeding guidance by $3.7 million, representing approximately 13% year-over-year growth on a reported basis and 12% on a constant currency basis [29] - Adjusted EBITDA margin was approximately 31.4%, with adjusted EBITDA of $41.4 million, which was $4.4 million above the high end of guidance [30] - Dollar-based net revenue retention was approximately 102% on a reported basis, indicating improvement year-over-year and quarter-over-quarter [30][25] Business Line Data and Key Metrics Changes - The data protection solution led net new ARR growth in the quarter, showcasing strong demand for security operations and unified endpoint management (UEM) [20][25] - The company launched anomaly detection as a service, enhancing its data protection capabilities and shifting focus from reactive defense to proactive resilience [19] Market Data and Key Metrics Changes - Approximately 45% of revenue was generated outside of North America, indicating a diversified market presence [31] - The company reported a significant increase in detected threats against small and mid-market businesses, highlighting the growing need for cybersecurity solutions [8] Company Strategy and Development Direction - The company is focused on driving security success, scaling its go-to-market strategy, and boosting customer expansion, with a channel-first model proving effective [19][21] - N-able is embedding AI capabilities across its platform to enhance cybersecurity solutions, positioning itself as a leader in the evolving cybersecurity landscape [10][17] - The company aims to democratize security by providing advanced AI SOC capabilities at a fraction of the cost, targeting small and mid-market businesses [15] Management's Comments on Operating Environment and Future Outlook - Management emphasized the critical role of AI in driving demand for cybersecurity solutions and the importance of embedding AI into their platform [10][26] - The outlook for the fourth quarter includes expected total revenue in the range of $126.5-$127.5 million, representing approximately 9% year-over-year growth [33] - The company raised its full-year ARR outlook to $530-$531 million, reflecting a commitment to balancing profitability with growth [34] Other Important Information - The company executed a share repurchase program, demonstrating confidence in its long-term value [26] - N-able's recent initiatives, such as sponsoring CATNIP, aim to standardize AI language across organizations, enhancing automation and efficiency [11] Q&A Session Summary Question: What are the keys behind the building momentum in ARR revenue? - Management attributed the acceleration to successful execution around the Adlumen acquisition and broadening channel presence [39][46] Question: How confident is management that net revenue retention has bottomed? - Management expressed high confidence that net revenue retention bottomed in the first quarter and has been improving due to successful cross-selling and gross retention efforts [49][50] Question: How is the Adlumen acquisition performing relative to initial expectations? - Management indicated that the acquisition thesis is holding true, with strong demand and successful scaling within the MSP community [70][71] Question: What is the company's approach to investing in AI? - Management confirmed ongoing investments in AI, viewing it as a significant opportunity for both short-term and mid-term growth, while maintaining a focus on achieving 30% EBITDA margins [76][80]