Varonis Systems, Inc.

Greetings and welcome to the Verona Systems Incorporated First Quarter 2022 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, James Areschia, Vice President of Investor Relations. Thank you, James. You may begin.

Thank you, operator. Good afternoon. Thank you for joining us today to review Varonis' first quarter 2022 financial results. With me on the call today are Yaki Feidelson, Chief Executive Officer, and Guy Melamed, Chief Financial Officer and Chief Operating Officer of Varonis. After preliminary remarks, we will open the call to a question and answer session. During this call, we may make statements related to our business that would be considered forward-looking statements under federal security laws, including projections of future operating results for our second quarter and full year ending December 31st, 2022. Due to a number of factors, actual results may differ materially from those set forth in such statements. These factors are set forth in the earnings press release that we issued today under the section captioned forward-looking statements, and these and other important risk factors are described more fully in our reports filed with the Securities and Exchange Commission. We encourage all investors to read our SEC filing. These statements reflect our views only as of today and should not be relied upon as representing our views as of any subsequent date. Varonis expressly disclaims any application or undertaking to release publicly any updates or revisions to any forward-looking statements made herein. Additionally, non-GAAP financial measures will be discussed on this conference call. A reconciliation for the most directly comparable GAAP financial measures is also available in our first quarter 2022 earnings press release, which can be found at www.barones.com in the investor relations section. Lastly, please note that an updated investor presentation, as well as a webcast of today's call, are available on our website in the investor relations section. With that, I'd like to turn the call over to our Chief Executive Officer, Yaki Feidelson. Yaki?

Thank you, Jamie, and good afternoon, everyone. Thanks for joining us today. Driven by 32% year-over-year ARR growth and a record quarterly operating cash flow, 2022 is off to a solid start for warrants, even with the steps we have taken stemming from the war in the Ukraine, which Guy will discuss in more detail. Our thoughts are with our employees, customers, partners, and all of those impacted by the war, and we are hoping for a peaceful resolution soon. Our mission of protecting sensitive data has never been more important as we continue to see a threat landscape that becomes more dangerous by the day. As a result, our pipeline is healthy and the demand environment is strong. I will discuss these trends and how we are well positioned to capitalize on them. So let's jump in. As we have been saying for many quarters, we believe that the current environment underscores the need for a platform To remind you, Varonis addresses three premium use cases that our customer view is increasingly interconnected. These are data protection, threat detection and response, and privacy and compliance. Given the current threat landscape, I want to focus today on our threat detection capabilities, data growth, The dependence on critical data and the increased profitability of stolen data has led to threat actors continuing to refine and sharpen their strategies. And as cyber attacks continue to increase in frequency, sophistication, and severity, the need for companies around the world to protect their sensitive data only becomes more urgent. Between state actors and commercial groups, Cyber attacks are in the headlines on a constant basis, and the target is always sensitive data. As a result, our data-first approach continue to resonate, validating most of strategy and what we have been saying for many years, that the perimeter is essential but isn't enough. A risk assessment show that once perimeter defenses are bypassed, critical data stores are wide open to attackers and insiders, and insiders can be the biggest threats of all. In short, any system, account, or person can be a potential attack vector, and all it takes is one. Companies need to assume attackers will breach at least one vector if they haven't done so already. And once, their attackers will go straight for critical data stores to maximize their profits. Specifically, we see them establish remote control, exploit any weakness they can find, go after accounts with higher level access, and use these accounts to steal data. Unfortunately, unless Veronikis is in place, attackers rarely counter any resistance once they are inside. This is why we say that every cybersecurity leader and company should assume breach. It's not a question of if, but when they will be compromised. When you assume breach, the first step is to assess the blast radius, all the data that an attacker could steal if one employee or vector is compromised, and then make the blast radius as small as possible. A smaller blast radius makes the attacker's job harder and gives our detective controls more chances to catch them as they work to overcome stiffer resistance. Our unparalleled ability to reduce the blast radius, to take inventory of sensitive data, to ensure that only the right people have access, and to put go-forward detective and corrective controls in place to keep it locked down is why customers continue to describe our platform as a must-have. Before I turn the call to Guy, I want to briefly discuss some key customers in the first quarter. A multinational media conglomerate with 35,000 employees became a new Voronis customer in Q1. They had massive amount of sensitive information in Microsoft 365 and no way to accurately classify it, see whether it was at risk and understand who was using it. After proving that we could provide these abilities for their data in Microsoft 365 and help them mediate critical open access issues, they purchased seven Voronis licenses and we are already discussing additional licenses to further protect their data on-prem and in AWS. At the same time, the opportunity to get our existing customers to double-digit number of licenses is clear, and the team had another strong quarter closing significant expansion deals. One of the largest toy companies in the world significantly broadened their Voronis deployment in Q1. Originally a perpetual customer with a more tactical view of data protection, they needed classification and alerting across multiple on-prem and cloud environments. The ability to clean up stale and risky data from acquisitions and automation to help them maintain a secure state. Today, we utilize more than 20 Varonis licenses, and we are discussing how our newer DA cloud offering can address risks stemming from their data in AWS. These are just two examples of how we are helping our customers solve their biggest data protection challenges, which has been our mission since we founded Voronis in 2004. We are focused on continuous execution and capitalizing on the enormous market opportunity before us. And we are excited for another strong year. With that, let me turn the call over to Guy.