Tenable (TENB) FY Conference Transcript

Summary of Tenable's Earnings Call Company Overview - Company: Tenable, a cyber exposure company focused on understanding and reducing risk through vulnerability management and exposure management platforms [2][3] Key Financial Highlights - Revenue: $239 million, representing an 11% growth, exceeding expectations [3] - Operating Margin: Strong at 20% [4] - Free Cash Flow: Over $80 million of unlevered free cash flow [4] - New Customers: Added over 300 new enterprise platform customers [4] - Record Deals: Achieved a record number of seven-figure deals [4] Guidance and Market Outlook - Cautious Guidance: Revised guidance downwards by approximately $17 million, reflecting potential longer sales cycles, particularly in the U.S. public sector [8][9] - Public Sector Dynamics: 15% of sales come from the U.S. public sector, which is experiencing personnel disruptions affecting sales cycles [7][9] - Strong Demand: Despite cautious guidance, the top of the funnel remains strong with good momentum in demand generation [6][10] Strategic Initiatives - Platform Consolidation: Tenable One is driving 30% to 40% of new business, focusing on consolidating various security solutions into one platform [17][21] - FedRAMP Certification: Achieved certification for Tenable One, enhancing credibility and opportunities in the federal government space [13][19] - AI Integration: Emphasizing AI as a key component for enhancing risk insights and operational efficiency [24][47] Competitive Landscape - Market Position: Tenable is well-positioned in the exposure management market, differentiating itself from competitors who are not as focused on this area [54][55] - Cloud Security Growth: Cloud security is one of the fastest-growing areas, with a 100% growth last year [66] - Challenges from Competitors: Noted pressure from larger platform vendors offering VM features, but Tenable maintains a strong competitive edge due to its established customer base and product offerings [51][56] Future Growth Opportunities - Focus on Innovation: Investing over 20% in R&D to drive product innovation and market expansion [29][78] - Public Sector as a Tailwind: Long-term growth expected from public sector contracts, leveraging past successes in the Department of Defense [80] - Acquisition Strategy: Recent acquisition of Vulcan aimed at accelerating market presence and product offerings [29][78] Conclusion - Optimistic Outlook: Despite short-term challenges, Tenable remains confident in its growth trajectory, driven by strong demand, innovative product offerings, and strategic positioning in the market [80]