CyberArk Software Ltd.

during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. I would now like to turn the call over to Erica Smith, Senior Vice President of Finance and Investor Relations. Please go ahead.

Thank you, Kat. Good morning. Thank you for joining us today to review CyberArk's strong first quarter 2024 financial results. With me on the call today are Matt Cohen, our Chief Executive Officer, and Josh Siegel, our Chief Financial Officer. After prepared remarks, we will open up the call to a question and answer session. Before we begin, let me remind you that certain statements made on the call today may be considered forward-looking statements, which reflect management's best judgment based on currently available information. I refer specifically to the discussion of our expectations and beliefs regarding our projected results of operations for the second quarter, full year 2024, and beyond. Our actual results might differ materially from those projected in these forward-looking statements. I direct your attention to the risk factors contained in the company's annual report on Form 20F filed with the U.S. Securities and Exchange Commission and those referenced in today's press release that are posted to CyberArk's website. We expressly disclaim any application or undertaking to release publicly any statements or revisions to any forward-looking statements made today. Additionally, non-GAAP financial measures will be discussed on today's call. Reconciliations to the most directly comparable GAAP financial measures are also available in today's press release, as well as in an updated investor presentation that outlines the financial discussion in today's call. A webcast of today's call is also available on our website in the investor relations section. With that, I'd like to turn the call over to our CEO, Matt Cohen. Matt?

Thanks, Erica. And thanks, everyone, for joining the call today. I want to start by acknowledging CyberArk's 25th anniversary, which we celebrated just a few weeks ago. Udi Makati, CyberArk's founder and executive chair, is a visionary who, along with the founding team, identified a market need and set out to secure the most valuable information within the world's most complex global organizations. Along the way, CyberArk pioneered the privilege access management market, a segment of identity that has become a critical security layer and consistently moved up the CISO's priority list. Since its founding, SideWork has grown and evolved in many ways. Our success was driven by an unwavering commitment to our mission of securing the world against cyber threats, so together we can move fearlessly forward. To execute our mission, we consistently delivered a cutting-edge innovation and transformative value to all our customers. Perhaps most importantly, in a world of constantly escalating threats, we have been relentlessly focused on a security-first mindset in every decision we make since day one of our founding. As a result of our strong execution and the trust that our security-first mindset has created with customers and partners, 25 years later, we are broadly recognized as the leader in identity security. Today, our unique value proposition to secure all identities with the right level of privilege controls on our identity security platform is resonating with customers. I am confident that we are only scratching the surface of this large and rapidly growing market opportunity. Our strong first quarter results demonstrate that we built on the momentum we experienced throughout 2023. The durability of demand for our solutions and our execution is highlighted by Subscription ARR of $621 million, growing 54% year-over-year. Total ARR of $811 million, growing 34% year-over-year. And Q1 results significantly exceeded guidance across revenue, operating income, and EPS. Total revenue growth accelerated to 37%, reaching approximately $222 million. Non-GAAP operating income came in at $33 million, a big improvement from a loss of $12.6 million in the first quarter of 2023, highlighting the operating leverage in our business model. Non-GAAP earnings per share was $0.75, up significantly from a loss of $0.17 in the year-ago period. We are thrilled to report $67 million in free cash flow for the quarter, significantly up from $4 million in Q1 of last year and a proof point of our commitment to profitable growth. The strength of our results and business momentum gives us the confidence to raise our guidance for the full year 2024 on all metrics, which Josh will talk about later. Our ongoing success is fueled by a number of secular tailwinds, including the pace of attacker innovation, digital transformation, ongoing migration to the cloud, and exponential increases in human and machine identities. Identity is the common denominator in every major cybersecurity breach. Our research has shown that over 90% of organizations have suffered from an identity-related cyber attack, a significant increase from about 60% in the prior year. Last quarter we discussed the extensive security challenges faced by CIOs and CISOs in safeguarding the entire spectrum of identities across IT, developers, workforce, and machines. In today's severe threat landscape, customers recognize that merely managing identities without privileged security controls is a risk they cannot afford. The security risks are further exasperated by the rise of AI, proliferation of machine identities, and increased elevation of access for human identities. As a result, organizations need to undergo a paradigm shift in identity security. They can no longer rely on yesterday's solutions and approaches to address today's problems. We at CyberArk are helping customers secure all identities, human and machine, as they access all environments, including hybrid and multi-cloud environments. Our differentiation comes from our deep domain expertise in privilege access, and we tailor privilege controls for each identity group to mitigate risk effectively. We discover, secure, and manage across the entire lifecycle of each identity group. We are the vendor best positioned to apply comprehensive, intelligent privilege controls across standing access, just-in-time access, and a zero standing privilege approach, all from a unified identity security platform. Our land and expand motion and the subscription flywheel continues to gain momentum. It all begins with new logos, and we signed nearly 200 customers in the first quarter. While the majority of customers land with PAM, approximately half of these new logos bought two or more solutions, with many choosing to secure multiple identity groups from day one. This speaks volumes about the power of our platform and the importance of identity security. A few exciting new logo examples from the quarter included a deal that perfectly showcases our platform selling motion and new routes to market, which was a financial services company that landed with PAM, EPM for workstations and servers, Conjure Cloud, and Identity Flows in a large seven-figure ACP deal that closed to the Azure marketplace. The PAM market has evolved well beyond securing only high-risk IT personnel. Today, modern PAM programs protect a much broader group of privileged users, including developers, shadow IT, and database and cloud administrators. As an example, we have great customers in the government and healthcare verticals. And this quarter, we are excited about our new relationship with NHS Resolution, a body of the UK Department of Health and Social Care. They kicked off their relationship with CyberArk with privileged cloud and secure cloud access and are planning to grow their footprint in the future. Each workforce identity is more powerful today than ever. and traditional MFA and SSO solutions are easily circumvented. We reimagined workforce identity by wrapping MFA and SSO with more controls to our secure web sessions, workforce password manager, EPM, and our new secure browser. This quarter, a large logistics company picked CyberArk for PAM and workforce identity after a head-to-head competition with a leading IDAS vendor. Our best-in-class security and breadth of our platform were the deciding factors in winning this amazing new logo. Our customer base is also an important growth factor for CyberArk, and our platform selling motion is accelerating expansion deals. Overall, we had a strong quarter of expansion within our base across all our solutions with particular strength in our secrets management business. The world of securing machine identities is changing rapidly. Organizations are grappling with a larger variety and an ever-growing number of machines, from applications to bots to workloads to IoT devices. Each one of these machines needs to be secured and managed across the lifecycle of multiple identity components, from secrets to digital keys to certificates. The proliferation of AI is further accelerating the growth and complexity of machine identities. This is becoming a top security challenge. Traditionally, managing machines often sits outside the security team's remit of control. However, this practice exponentially increases risk and is unsustainable in today's threat landscape. Customers increasingly realize they need to scale their machine identity security programs beyond local vaults, loosely enforced policies, and open source tools. They need an enterprise-ready machine identity security approach that can scale and is tied into their human identity security program through a single platform. One great win that exhibited all I am describing was with a CyberArk customer who has been with us since 2018. We expanded our long-standing relationship with the Department for Works and Pensions in the UK with an expanded program while kicking off a robust secrets management program. With CyberArk as a key strategic partner, they are focused on aligning their identity security roadmap for human and machine identities, supporting the UK government's focus on a stronger cybersecurity posture. We talked earlier about how we are protecting the workforce using a reimagined approach that goes beyond SSO and MFA, and for this approach, It needs to extend also to the endpoint, the most common entry point for attackers. By removing local administration rights and enforcing least privilege and detecting identity-based threats targeting the workstations and servers, organizations can reduce the endpoint attack surface. This strategy also protects organizations from attackers who turn off EDR agents and proceed quietly without being detected. which is one of the main reasons a multinational food company in LATAM signed a high six-figure ACV EPM deal in the first quarter. This customer is looking to deploy CyberArk everywhere as part of its broader identity strategy. During the past few years, EPM experienced strong growth and recently surpassed $100 million in ARR. This achievement is a testament to the solution's ability to extend identity security and zero trust to workstations and servers. We are excited about the potential for further growth in our EPM business, both with new and existing customers. We also talked, though, about the exploding population of developers and the need to start securing them as privileged identities without interfering with their speed of innovation. Our secure cloud access solution, or SCA, provides best-in-class privilege controls to hybrid and multi-cloud environments. It applies the principle of least privilege access by granting just enough permissions with zero standing privileges while still allowing developers, data scientists, and cloud engineers to work natively and efficiently without having to change their preferred workflows. We are incredibly excited about this solution, and in the first quarter, we continue to see excellent traction with the offering. In a deal with a major retailer, the customer broadly deployed CyberArk SaaS solutions in a continued move to the cloud, but they cited secure cloud access as the most important differentiator and signed a high six-figure ACV deal that also included privileged cloud, secrets, and workforce identity. Q1 was an exciting quarter for our focus on innovation and new releases. Last year, we discussed our plans to expand our routes to market and increase our market reach through MSPs. According to Gartner, 40% of security customers are expected to consume solutions through a managed service by 2026. To accelerate this channel, we recently launched the CyberArk MSP Console. By providing MSPs with a single command center, this console is a key step in helping our MSP partners build managed services that secure their customers' human and non-human identities. We are also very excited about the general availability of CyberArk Secure Browser, the industry's first identity-centric secure browser. It is purpose-built for a cloud-first world and protects our customers against emerging threats while enabling productivity and ease of use across all CyberArk solutions. Secure Browser is designed to help protect customers from fast-growing attack methods like cookie harvesting and browser-based attacks, both at and beyond login. It is natively integrated with our workforce solutions, providing a seamless unified user experience, and serves also as a direct access portal to our entire platform. We believe Secure Browser will not only enhance security for our customers, but also drive adoption of our solutions. Lastly, CyberArk has recently received FedRAMP high authorization for two of its SaaS solutions, Endpoint Privilege Manager and Workforce Identity. Our investment in FedRAMP High highlights CyberArk's commitment to help the public sector implement strategies that adhere to zero trust principles and move to a more secure and efficient future. As excited as I am to talk about all these great developments, I'm even more excited by what we have in store for our customers and all of you at impact in Nashville in just a few weeks. We have a tremendous lineup of truly innovative developments to talk about, so please tune in, and we look forward to seeing many of you there. Josh will go deeper into the P&L in just a moment, but I wanted to emphasize that although most of my comments this morning focused on the potential for tremendous growth, we remain equally committed to delivering profitability and cash flow. This was evident in our Q1 results, and we remain well on track to deliver on the long-term targets we introduced last year. In summary, our momentum from 2023 continued in the first quarter, and we kicked off the year with a strong first quarter. I will leave you with four main takeaways. First, demand for our solutions remains strong, and identity security is at the top of CISO's priority list. Second, our unified identity security platform is meeting a clear customer requirement to apply the right level of privilege controls to every identity, human and machine. Third, our security first approach is a clear differentiator for cyber arc in the market, helping us win deals. And fourth, we have a long runway for growth and are making disciplined investments to capture a bigger share of the large and growing market opportunity. Josh, I'll turn the call over to you.