Tenable Holdings, Inc.

Greetings and welcome to Tenable Q1 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief 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. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Ms. Erin Carney, Vice President in Mr. Relations. Thank you, Ms. Carney. You may begin.

Thank you, Operator, and thank you all for joining us on today's conference call to discuss Tenable's first quarter 2024 financial results. With me on the call today are Meet Yuran, our Chief Executive Officer, Dave Vince, our Chief Financial Officer, and Jason Merrick, Senior Vice President Product. Prior to this call, we issued a press release announcing our financial results for the quarter. You can find the press release on our IR website at tenable.com. We will make forward-looking statements during the course of this call, including statements relating to our guidance and expectations for the second quarter and full year 2024, 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, including tenable one, planned innovation, and new products and services. The potential benefits and financial impact of our recent acquisition of Aramedic, our expectations regarding the cost savings associated with optimizing our go-to-market efforts, and our expectations regarding long-term profitability and free cash flow. 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 beliefs and assumptions only as of today and should not be considered representative of our views as of any subsequent date. And 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 with the SEC. In addition, all of the financial results we will discuss today are non-GAAP financial measures, with the exception of revenue. 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 press release includes GAAP to non-GAAP reconciliations for these measures. I will now turn the call over to Amit.

Thank you, Erin. We're very pleased with our results in the quarter. CCB, revenue, operating income, and cash flow all came in better than expected. Our leadership and exposure management resulted in strong momentum in Tenable One. In short, we're off to a good start for the year. There are two clear takeaways this quarter. First, exposure management, the category we pioneered over five years ago, is increasingly recognized as a crucial practice for security teams. Tenable is uniquely positioned to identify and mitigate risks across the attack surface, including cloud, identities, operational technology, applications, and IT assets. And second, that the convergence of these categories onto a single platform is the most efficient way to truly understand and reduce risk. And we believe we are the only security vendor in the market providing these capabilities with tenable want. Let me go deeper on the first point. Exploiter management is gaining widespread attention and validation from security practitioners, industry analysts, and vendors. In fact, Gartner predicts that by 2026, organizations prioritizing their security investments based on an exposure management program will suffer two-thirds fewer breaches. We believe there's no company better positioned than Tenable to seize this opportunity, thanks to our early focus and ongoing commitment to delivering innovative exposure management solutions. And our focus is paying off, with these solutions now representing approximately half of our total new sales in the quarter, inclusive of Tenable One. This momentum is a result of customers realizing that managing risks in siloed programs is failing them. Security products for identifying and closing exposures of different types are still very disjointed, forcing security teams to work in isolation, just like their tools. This approach to security makes it extremely difficult to defend against advanced threats or more sophisticated campaigns that leverage multiple attack methods and complex tool sets. For example, an attacker may gain access from an endpoint vulnerability, move laterally to an over-provisioned identity for privilege access, and from there, exploit a misconfigured service running in the cloud. Point solutions simply are not able to identify and remediate these risks across domains. A unified approach that consolidates visibility from assets, identities, and misconfigurations spanning across domains from on-prem to the cloud to critical infrastructure creates leverage and insights previously stovepiped. This is exactly what Tenable One is designed to deliver. A great example of Tenable One's impact involves a multi-billion dollar automotive parts company that selected Tenable One in Q1. they were looking to gain a unified understanding of risk across their tax surface. Recognizing the limitations of separate solutions, they replaced a key incumbent in vulnerability management with Tenable, while also adopting Tenable OT and cloud security to extend their visibility and remediation capabilities. Notably, the customer opted for our cloud security solution because it outperformed several well-known pure play CNAP competitors in uncovering exposures in the cloud and the fact that it integrates with the rest of their staff using Tenable One. We repeatedly encounter scenarios that underscore this new way of thinking. Conversations with customers and prospects often lead them to realize the dangerous limitations of using separate products to manage risk, like using a specific control system security product that has no connection to the rest of their environment. Customers are coming to grips with the fundamental truth. You cannot fully understand the risk of an interconnected environment when your risk management practice is compartmentalized. These scenarios are the reasons why solutions like our OT and our CNAP capabilities are gaining traction with our customers. Given the scope of our coverage, Tenable stands out in our capacity to identify and prioritize risk. We leverage the data lake built around exposure information that encompasses hundreds of billions of aspects of threat, vulnerability, entitlement, and configuration data. This robust foundation underpins all of our products, from CNOT to vulnerability management to identity to OT. Each product is strengthened by the deep insights gleaned from our entire portfolio. Last quarter, we continued to innovate aggressively in exposure management along many fronts, including the integration of more generative AI capabilities into Title I. These new advancements bring to life interactive attack path visualizations and offer an AI assistant that answers queries and delivers specific mitigation advice. This tool gives our customers real-time access to the latest exposure data tailored to their specific environment. In addition, it provides customized guidance for fixing these issues. In an era marked by huge cybersecurity talent shortages, our generative AI-driven enhancements help streamline workflows, enhance security insights, and boost productivity. And once again, position Tenable at the forefront of exposure management innovation. We have demonstrated an ability to differentiate our core products as well as with our broader exposure management platform, whether it's in identity, OT, cloud security, or our unified platform, we are delivering solutions that enable our customers to better understand and remediate risk. And we are doing it in a way that has delivered impressive margin expansion. Finally, on a personal note, thanks to everyone for the well wishes regarding my recent diagnosis. My treatment is going well, but my voice has been temporarily impacted. As a result, I will not be able to fully participate in the Q&A session today and apologize in advance for subjecting you to even more time with Steve. But I do look forward to speaking with you in the upcoming investor events in the near future. I'll now turn the call over to Steve for further commentary on our financial results and outlook.