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spk_0: ladies and gentlemen thank you for standing by and welcome to the cyber arc the third quarter twenty twenty earnings conference call at this time all participants are in a listen only mode after the speakers presentation there will be a question and answer session to ask a question during the session you will need to press star one on your telephone please be advised that today's conferences being recorded if you require any further assistance please press door zero i would now like down the conference over to your speaker today eric smith with investor relations thank you please go ahead madam
spk_1: they do sunday morning thank you for joining us today to reduce seibert third quarter two thousand and twenty financial results with me on the call today are redeemable party chairman and chief executive officer and just below chief financial officer after the bread remarks we will open the call up or a question and answer session before we begin let me remind you oh that certain statements made on the call today may be considered forward looking statements which reflect management best judgment based on currently available information i refer specifically to the discussion of our expectations and beliefs regarding are projected result of operations for the fourth quarter or actual results might differ materially from those projected and leans forward looking statement i direct your attention to the risk factors contained in the company's annual report on form twentieth bad with us securities and exchange commission and those referenced in today's press release that are posted to say works website as well as befits bit getting our ability to actively begin transitioning to visit to a subscription model and twenty twenty one and the duration and scope of the coven nineteen pandemic it's related impact on global economy and our ability to egypt in response to the pandemic seibert expressly disclaims any application or undertaking to release any a public updates or revisions to any for the good statements made here in additionally non gap financial measures will be discussed on this conference call a reconciliation for the most directly comparable get financial measures are also available in today's press release as well as in an updated investor presentation that outlines the financial discussion into today's call this information can be found at www dot fiber that farm in the quarterly results section under investors
spk_2: lesion also a webcast of today's call will be available on our website in the irish section with that i'd like to turn the call over to our chairman and chief executive officer will be more body really vector ago and thanks everyone for joining the it we percival we hope you and your families are all will while the global pandemic has had a profound did back then all of our lives or community or for of customers for burgers and employees have adjusted to the new normal this is reflected in our third quarter business performance record levels of customer prospect engagement and business barghuti games i am very excited to discuss a strategy to begin actively transitioning to subscription model into a when one but first i will dutch on third quarter highlights and industry trends
spk_3: for the third quarter we reported on and seven million dollars in revenue
spk_2: thirty million dollars in non job operating and gum and not get a be as of thirty one sense for sure we are pleased with our execution and the momentum in our business and therefore our mix a recurring revenue bookies accelerated driven by increase demand for says solutions this impact and are reported revenue profitability which josh will discuss literally school as we move deeper into our subscription transition it will be important in the near term to look beyond the headline piano as it is a lagging indicator of our true success we believe annual recurring revenue or a or are which grew forty percent in the third quarter reaching two hundred fifty million dollars provides increase visibility into the overall strength and a long term growth of our business this metric demonstrates that we are building a rapidly growing base of high value more predictable recurring revenue industry tell compared to underpin our business and contribute to our record by by growth and remains at the top of cia oh and see so priority was delivering a critical layer of protection against hacker innovation while enabling regulatory compliance did transformation and cloud migration escalating privileges is the most frequent pathway for attackers were more aggressive with expanded a tax service and work from anywhere environment to manage that risk organizations georgia cyborg as the clear market leader and industry innovator there's also a long list of ever changing compliance requirements that are solutions help address as an example the national institute of standards and technology or knit recently introduced and is for secure zero trust architecture way specify that the pam privilege access management is critical to comprehensive zero just security frameworks when it comes to digital transformation a club migration strategies customers can implement these programs faster smarter and more securely by leveraging pam these programs have created highly distributed i environments and increased automation an application development and business processes resulting in the proliferation of privileges almost all identities including users machines applications and tools can be privileged under certain conditions our customers have increasingly asked us to secure additional identity use cases which is significantly expanding our total addressable market our vision find any security is taking a says delivered security first approached with a foundation and pan to provide users with the right level of access and privileges depending on the activity transitioning to a subscription company accelerate this long term vision by aligning cyborgs business to these trends we have always focused on our customers and delivering a meaningful layer of security that evolved at the base of their ip environments that included be ready for when enterprises demand shifted to sas and subscription and twenty twenty years have changed have happened in a matter of months covered nineteen and work from anywhere have accelerated digital transformation he cloud migration and significantly increase as adoption because of our strong execution and business agility we are in a great position as we begin to actively transition our business next year and fact we will enter twenty twenty one quarters ahead of most technology companies with gone through similar transitions or financial results show that customers are embracing recurring revenue consumption mouth without making any changes target market approach year to date more than thirty five percent of our new license bookings were from sat and subscription in the third quarter this makes reach over forty five percent of our new license buildings including seven of our top them license next vices deal this dramatic increase in subscription makes was driven predominantly by record set the man we have the broadest most feature rich club or for you to secure rouge axis and i day security in the market our ongoing innovation the breadth of awkward for you and a maturity of our cloud offerings will be a key driver of outrun subscription transition program adding incredibly valuable sas recurring revenue and deeper long lasting customer relationships we have been working on a comprehensive readiness for back to ensure long execution strong seclusion throughout this transition a dedicated cross functional team is also working to ensure we execute the transition with rigor and focus we also conducted internal research and engage one of the leading independent consulting firms who validated the durability of the man for on forever subscription well beyond covenant covered my team and the current economic environment we will adjust our go to market approach that will holistically nurture our customer relationships putting their success at the centre of everything we do go and is taking on an expanded role and the newly created position of chief operating officer he will can do that had the global sales organization and is adding all those sales engagement including services support and customers success this organizational structure will support long term sustainable growth by accelerating customer adoption expansion and the same time and sure that we deliver best in class customer satisfaction and strong renewals matt has deep operational experience and will be an integral part of our subscription transition success the field he has done a great job selling status of ships and year to date dealt accelerate the pace of our tradition we will not only rollout comprehensive sales and channel and a woman programs but also shift our compensation plan in favor of sad and subscription sales versus perpetual licensee beginning and twenty twenty one we will be rolling out attractive new solution packages to incentivize customers to adopt their assess and subscription offerings i'm confident that this transition will reduce friction in the sales process increase crops cell activity and build enduring relationships with our customers by delivering deeper value and stronger security moving into a few the it builds on the third quarter we are seeing unprecedented activity with existing customers were increasingly turning to cyber as a trusted advisor following our prescriptive pam bluebird methodology as examples a large uk consumer manufacturing company is building it's long term security programs on for pat an application access manager for develops to protect it's fast growing global multi cloud environment we're seeing increase traction for am as organizations increasingly shift left integrating security into devolves earlier to drive down costs and improves beat the market our largest i doubt that when the day is an existing cyborg enterprise this organization understand the power of multifactor single sign on life cycle management integrated with path which is the foundation of our identity security strategy in a third quarter new business activity and by by progression continue to pick up we added more than a hundred ninety new logos including a fortune five hundred company and a global one fifty technology company while we're seeing increase demand for a new cloud solutions are are premise offerings including corporate data security continue to meet the rick mormons have many large enterprises a few new in his highlights include in a seven figure rip replace when a large regional bank is modernizing and security program with core pass for operational efficiency with automatic financial on boring across it's eight of us and on premises violence and will also benefit from our extensive seek you've integrations including still point quo alice and prison as part of a digital transformation program a fortune five hundred company is rolling out cyber privilege cloud this new chief information security officer wanted to maximize controlled environment while benefiting from the efficiency and tremendous kind of value of sas delivering a large healthcare system in the u s landed with privilege cloud and point for those measure and application at his magic hospitals are frequently attack by wrestler and we provided a customer with peace of mind given that endpoint privilege manager has been tested against and successfully block over three million types of ransom innovation in the foundational pillar of us tragic and strengthens our leadership position the market we were pleased to be named a leader in the gardiner august twenty twenty magic water for project management position both highs and ability to execute and further in completeness of vision for the second time in row we can hear to make ongoing foundational investments in our core architecture that are enabling us to release major innovation functionality more quickly yesterday introduction of cyber clouded talents manager and ai power sas solution that enhances club security is a prime example of the innovation engine of from our sidebar collapsing as our as new environments and cloud services are deployed thousands of permissions are created that provide a pathway for attackers to gain privilege axis we can now health organizations to take back control of cloud security by transforming how these permissions are secured and managed with continues visibility indepth analysis and real time and mediation finally i want to provide a bit of color or what we're seeing from customers and partners after crisis planning and business continuity in early twenty twenty organizations are deep into strategic planning they recognize that long term success is dependent on the speed of the digital transformation programs this is increasing the sense of urgency to not only implement strong security controls to mitigate risk but also incorporate technology that will enable the or in addition to move forward faster in every quarter of points way our new pipeline generation across all of our solutions as reach another record demonstrate that we are capitalizing on these trends we are well our way to transforming cyber into a high growing recurring revenue company with significant contribution from ourselves solutions i am confident that this subscription transition program will further solidify our position as the market leader accelerates out adoption build a base of high value recurring revenue and position as to deliver sustainable growth and profitability
spk_4: josh will now discuss our financials and more detail of subscription transition and outlook for the fourth quarter josh ot a boy that that the details of the quarter a lighter a minute that we both inside and the wet died this morning that will be helpful as they walk through our though as would imagine we have played with them i met them in a bit that federation about that of it's good job growth is beginning to impact i report a revenue profitability making it a now in the near term more are lagging indicator that that the ship in a bookings resulted in total revenue of one hundred and seven million dollars or third quarter compared to one hundred and eight million dollars and third quarter last year while items revenue in the third call i was forty six million dollars compared with it the eight million dollars and a third quarter last year the recurring portion of the like was revenue at thirteen million dollars that's an increase from four million dollars that year given by even faster a guy like was booking got year today
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