Dropbox, Inc.

And thank you for standing by. Welcome to Dropbox's third quarter 2025 earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please note that today's conference is being recorded. I will now hand the conference over to your speaker host. Peter Sabler, please go ahead.

Good afternoon and welcome to Dropbox's third quarter 2025 earnings call. As a reminder, we will disclose non-GAAP financial measures on this call. Definitions and reconciliations between our GAAP and non-GAAP results can be found in our earnings release and our earnings presentation posted on our IR website at investors.dropbox.com. We will also make forward-looking statements on this call, including statements about our future outlook for our fourth quarter and fiscal year 2025, as well as our expectations regarding our business, assets, strategies, and the macroeconomic environment. Such statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those described. Many of those risks and uncertainties are described in our SEC filings. including our most recent and forthcoming reports on Form 10Q. Forward-looking statements represent our beliefs and assumptions only as of the date such statements are made. We disclaim any obligation to update any forward-looking statements except as required by law. I will now turn the call over to Dropbox's CEO and co-founder, Drew Houston.

Thanks, Peter, and good afternoon, everyone. Welcome to our Q3 2025 earnings call, and I'm here with Tim Regan, our CFO. I'll walk through our business and product highlights, and then Tim will cover our Q3 results and our outlook for the rest of the year. Our teams executed well this quarter. Constant currency revenue came in comfortably ahead of guidance, driven primarily by better-than-expected retention across our individual and self-serve teams plans. Non-gap operating margin was up meaningfully year over year, reflecting our focus on operational efficiency, along with some timing-related spending shifts that Tim will cover. Now let's dive into our two strategic priorities, which are scaling Dash and simplifying and strengthening our core FSS business. We'll start with Dash. Our industry is spending trillions of dollars on AI models that can explain quantum physics but can't find your Q2 board deck. This is the problem that we're solving with Dash. Specifically, the issue with today's tools is that they don't understand your context at work. Consumer AI tools don't know about your company. Copilot can't see your Slack. Gemini can't see your Salesforce. You're always starting from zero, cutting and pasting and uploading documents one at a time. Meanwhile, SMBs are either overlooked by enterprise search tools or are stuck using consumer tools that weren't built for business and create real security risks around data leakage. Dash solves this by connecting to all your work apps from Microsoft, Google, Slack, Notion, everything you use. You get one search box instead of 10. You get AI that actually sees your full picture, not just one ecosystem slice. And unlike consumer AI, Dash is built for business from the ground up with the security and admin controls that IT teams actually need. In Q3, we made the Dash product significantly better. Search latency dropped by 75% while quality actually improved. For creative professionals, a core segment for us, Dash now transcribes videos, lets you chat with them, and can search text within images and scans. We also brought on the Mobius Labs team to push our multimodal capabilities even further. They're building AI models that are optimized for large-scale multimedia processing, opening up entirely new workflows for teams working with video. And we upgraded Stacks, our intelligent content collections, with ranked answers and simpler sharing. Dash is the only AI tool for SMBs that goes beyond search and chat to actually help organize and share content across your entire company. We're seeing strong early engagement, so 60% of our managed Dash weekly active users are now using Dash at least two days a week, which tells us that the product is becoming part of their daily workflow. And security remains critical. IT admins need to protect their company's content, so this quarter we shipped automated protection for high-risk sharing. Admins can now enforce policies that automatically detect and fix issues like public links or inappropriate external access. And finally, we made two important announcements during our fall launch a couple weeks ago. First, we launched the self-serve version of Dash in the U.S., so you can now go to dropbox.com slash dash and get your team up and running. No multi-month deployments, no 50K setup fees, just sign in with your work email, connect your apps, and go. This lets us reach the many SMB customers that enterprise-focused companies can't. We're starting by pricing it at $19 per user per month, and current and advanced FileThink and SharePlan customers are eligible for a 50% first-year discount. Second, for our Dropbox business customers, we started rolling out native Dash integration inside of the Dropbox app. This brings Dash's search, chat, and stacks directly into the FSS experience our customers already know. You can ask questions of your files in natural language, get summaries, and find related content. Trial users also get the standalone version of Dash for deeper capabilities and the ability to connect all of the rest of your work apps beyond your files. Dash within Dropbox is starting to roll out to Dropbox FSS teams on the web, with mobile and desktop coming in the next few months. And to ensure a great experience, we're rolling it out in stages over the coming quarters, starting with a wait list for U.S.-based FSS customers. This launch represents a significant milestone. It broadens access and introduces Dash to our massive FSS user base and to new SMB customers. Early cohorts are showing good engagement, particularly with search, and we're gathering feedback, improving the product daily, and laying the groundwork to convert trials to paid licenses. turning to core FSS, where our focus remains on simplifying and strengthening the user experience while driving efficiency. We continue to make progress on retention and downsell, driven by better value communication and better optimizing our cancellation flows. And with improved sharing, sync, and storage management tools, our individuals business just posted our highest ever CSAT scores. We're also focused on trial conversions. This quarter, we started testing better localization with region-specific value messaging and landing pages, expecting conversion gains over time. We're also testing a low-friction import tool for Google Drive and OneDrive users, making it easier to switch providers right in the sign-up flow. Our new unified checkout brings FSS, Dash, and add-ons into a single streamlined purchase flow for team trials, including an Apple Pay option coming later this quarter. Early results show conversion gains, and we'll extend this to individual trials later this quarter. For IT admins, we launched a storage management dashboard showing team data usage and trends, which addresses a top customer request and helps drive our highest ever IT admin CSAT score. DocSend had another solid quarter with double-digit revenue growth driven by 17% increase in total account creations and strong engagement. The DocSend team is applying learnings from core FSS to drive retention gains. And Sign and Form Swift modestly exceeded expectations. It's been an eventful quarter. And just like we took the cloud the last mile in 2007 by giving you a folder that synced everywhere, with Dash, we're taking AI the last mile by connecting it to your actual work. With Dash Self-Serve Live and Dash and Dropbox rolling out, we're building awareness, driving trials, and turning early users into advocates. Our core team is making real progress, strengthening and simplifying FSS while operating more efficiently. The momentum is energizing, and we look forward to updating you on our progress in the coming months. I want to thank everyone on the Dropbox team for all their hard work this quarter. I'll now turn it over to Tim to cover our Q3 financial performance and Q4 outlook.