Tenable Holdings, Inc.

Greetings. Welcome to the Q1 2022 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Aaron Carney, Senior Director in Investor Relations. You may begin.

Thank you, Operator, and thank you all for joining us on today's conference call to discuss Tenable's first quarter 2022 financial results. With me on the call today are Amit Yuran, our Chief Executive Officer, and Steve Vince, our Chief Financial Officer. Prior to this call, we issued a press release announcing our financial results for the quarter. You can find the press release on the IR website at tenable.com. Before we begin, let me remind you that we will make forward-looking statements during the course of this call. including statements relating to our guidance and expectations for the second quarter of full year 2022, growth and drivers in our business, changes in the threat landscape in the security industry and our competitive position in the market, growth in our customer demand for and adoption of our solutions, the potential benefits and financial impact of our acquisitions, including our recent acquisition of Symptom and the expected acquisition of Fit Discovery. planned innovation and new products and services, our expectations regarding long-term profitability, and our ability to attract and retain employees and its impact on our business. These forward-looking statements involve risks and uncertainties, some of which are beyond our control, which could cause actual results to differ materially from those anticipated by these statements. You should not rely upon forward-looking statements as a prediction of future events. Forward-looking statements represent our management's beliefs and assumptions only as of today and should not be considered representative of our views as of any subsequent date. We disclaim any obligation to update any forward-looking statements or outlook. For further discussion of the material risks and other important factors that could affect our actual results, please refer to those contained in our most recent annual report on Form 10-K and subsequent reports that we file at the FTC. which are available on the FCC website at fcc.gov. In addition, during today's call, we will discuss non-GAAP financial measures. These non-GAAP financial measures are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP financial measures versus their closest GAAP equivalent. Our earnings release that we issued today includes gap to non-gap reconciliations for these measures and is also available on the investor relations section of our website. I'll now turn the call over to Amit.

Thank you, Erin. Today I'll discuss our outstanding financial performance in Q1, our accelerated momentum, exciting product enhancements, including our agreement to acquire BitDiscovery, and the continued progress of our cyber exposure management platform. With that, let me first touch on our Q1 results. We saw tremendous strength in the first quarter, driven by contributions from all products and theaters. Our CCB growth for the quarter was 31%, which we believe positions us well for a strong 2022. Additionally, the health of our market and the durability of our business provides us with the confidence to continue to invest in our products and our people. Momentum across cybersecurity is accelerating as increased threats are driving a healthy spending environment. The need for customers to understand their true exposure and risk is at an all-time high. We're seeing that momentum translate across our entire portfolio, core VM and exposure solutions, particularly in our identity and cloud security offerings. We're leveraging this momentum and have plans to add significant new capabilities to our cloud offerings, as well as create unique differentiation for our VM customers. These enhancements include expanding our exposure platform, Tenable EP, to include Tenable AD and Tenable CS. EP customers can deploy these new capabilities immediately and take advantage of our single unified licensing model to secure their cloud environments and active directory. Launching our cloud native application security platform, Tenable CS, to address cyber risks from build through run time. we delivered seamlessly integrated cloud-native web application and container exposure data into Tenable.io. This allows organizations to analyze cloud and web app exposures alongside other assets and take advantage of the rich platform's capabilities, such as advanced search, streamlined reporting, comprehensive role-based access controls, and a single sign-on for easy access, unified APIs, and other capabilities. We also delivered important updates to Tenable AD and Tenable OT to detect new indicators of attack used to escalate privileges in ransomware and nation state exploits and attempts to exploit OT devices. Our investments in product development over the last few years highlight our commitment to best in class security assessment across a customer's attack surface. We think our timing couldn't be better with increased threats, larger consequences for business, and a helping spending environment for cyber, we believe we're moving into the golden age of VM. More than ever, customers must understand every aspect of their digital footprint so they can reduce their cyber exposure, and this is reflected in a larger TAM that we discussed on our Investor Day. In conjunction with earnings, we announced that we've reached an agreement to acquire BitDiscovery, an external attack surface management leader with a differentiated internet-facing asset discovery, attribution, and monitoring capability. The problem for many organizations is that they're largely blind to the full and ever-changing scope of their internet-facing assets and services. These systems serve as high-priority exposure points for attackers and important starting points for attack paths into critical systems. Discovering and gaining insight into every part of a business's digital footprint are essential steps for any effective cybersecurity program. In concert with our attack pathway assessment technology, this new capability will allow us to tie the artificially fragmented parts of security into one view that shows how attackers from the Internet can ultimately gain access to any specific high-value system, regardless of where it sits. For CISOs, this analysis is a knockout punch of what is top priority. Once integrated, the automated discovery of external attack surface will be native in the new and upgraded version of Nessus. Automated attack surface discovery will also be included in many of our enterprise products, including Tenable SE, Tenable IO, Tenable EP, and our cloud security solution. This insight will drive great value for our customers and increase adoption of our cyber exposure solutions. Beyond this basic discovery offered to many of our existing customers, we will also have a new SKU with advanced attribution functionality that will help customers understand the broader set of contexts and exposure of these assets. We're incredibly excited about adding these new capabilities, and bit discovery is a very natural and tightly aligned motion for our go-to-market team. Attack surface management data is absolutely critical exposure data. ASM has the same buyer and the same go-to-market motion as the VM buyer with a highly compatible messaging, which will provide very fast time to value for our customers. Let me talk a little bit about Tenable EP. During the quarter, we extended Tenable EP beyond vulnerability management, web application security, and Lumen by adding assets and security findings across identity, and cloud via the inclusion of Tenable AD and Tenable CS. Cloud assets include systems and software vulnerabilities and cloud security posture management across workloads, but also Kubernetes clusters and containers. EP now offers customers a comprehensive cyber exposure management platform that assesses hybrid IT, the full lifecycle of cloud and cloud native environments, Active Directory, And following closing of the acquisition and integration of bit discovery and internet-facing assets such as web applications, cloud resources, open gateways, bringing these solutions into one unified platform enables us to identify, evaluate, and prioritize risk across the entire digital footprint for our customers. In addition, we saw continued traction in the quarter for Tenable EP and it's quickly becoming a rapidly growing portion of our new sales. We're leading with Tenable EP in the commercial sector where sales cycles are shorter and we're seeing dramatic adoption also occurring in large enterprises as they embrace EP as well. For years, we've been pioneering cyber exposure and the role Tenable plays and it's an incredibly important and emerging discipline. When we introduced this category, it was a new concept to many investors, despite its rather than mating with the CISOs. Since then, we've expanded exposure beyond traditional assets to include cloud assets, cloud infrastructures, and cloud-native architectures into identities and operational technologies and web applications. And more importantly, we've expanded analytic insights between these data sets in the form of attack pathways, benchmarking, and other methods to prioritize risk. We believe Gartner's recent recommendation that organizations need to look beyond vulnerability patching and to manage a wider set of security exposures is spot on. Further, we see Gartner's newly defined discipline of exposure management, which includes some mature markets, like vulnerability management, and emerging markets, such as cloud native security and attack surface management, as very well aligned with the definition of cyber exposure and the strategy that we have been pursuing and talking about for years. We believe strongly in this opportunity and that we are an early market leader as it continues to mature and grow. We'll continue to invest, including the planned acquisition of BitDiscovery, to deliver on our vision for an exposure management platform that enables our customers to better assess and manage risk. Now, before I hand the call over to Steve, I want to talk a bit about the people side of our business. As a software company, our greatest long-term asset is our people. It's an area that we spend a lot of time and effort on. Coming out of the pandemic, many investors asked about our ability to continue the hiring necessary to fuel growth, and candidly, how we will fare in the great resignation. We always strive to nurture a culture of innovation and transparency, while building a diverse, thriving workforce. Our investments in our people continue to pay off, and I'm happy to report that in Q1, we had exceptional results in our recruiting efforts, hiring and onboarding. We're also seeing strong retention levels this year. People want to work at Tenable. New talent and lower attrition will translate directly into increased efficiency and an increased pace of innovation. Tenable has become a market-recognized destination employer of choice with a great culture and compelling products in a very exciting market. I'll now turn the call over to Steve for further commentary on our financial results.