Alteryx, Inc.

Greetings and welcome to Alteryx first quarter 2022 earnings conference call. At this time, all participants are in 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. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Ryan Goodman. Head of Investor Relations, Alteryx. Over to you, sir.

Thank you, operator. Good afternoon, and thank you for joining us today for Alteryx's first quarter 2022 earnings conference call. I'm Ryan Goodman, Alteryx's Head of Investor Relations. With me on the call today are Mark Anderson, Chief Executive Officer, and Kevin Rubin, Chief Financial Officer. Additionally, Paula Hansen, our President and Chief Revenue Officer, and Suresh Patel, Our Chief Product Officer will be joining us for the question and answer session after prepared remarks. This afternoon, we issued a press release announcing our results for the first quarter ended March 31st, 2022. If you would like a copy of the release, you can access it online on our Investor Relations website. During this call, we will make forward-looking statements related to our business, including statements about our financial guidance for the second quarter and full year 2022. These statements are not guarantees of future performance. They are subject to a variety of risk and uncertainty, some of which are beyond our control. Our actual results could differ materially from expectations reflected in any forward-looking statement. For discussion of the material risks and other important factors that could affect our actual results, please refer to our SEC filings available on the SEC's website and our investor relations website, as well as the risks and other important factors discussed in today's earnings release. Additionally, non-GAAP financial measures will be discussed on today's call. A reconciliation of these measures to their most directly comparable GAAP financial measures can be found in today's earnings release. With that, I'd like to turn the call over to Chief Executive Officer Mark Anderson. Mark?

Thank you, Ryan. It's great to have you on the team. And thank all of you for joining us on the call today. Q1 was an outstanding quarter across the board for Alteryx and a terrific start to 2022. Key financial metrics all exceeded the high end of our guidance range, driven by increased traction with large enterprise customers. This reflects both global digital transformation tailwinds, coupled with contributions from our enterprise go-to-market initiatives. As of Q1, nearly half of the Global 2000 are now Alteryx customers. We had an exciting quarter on the cloud front with our new product launches and game-changing acquisition of Trifacta. Our entire cloud portfolio is now available as part of our new unified Alteryx Analytics cloud platform. And last but not least, we strengthened our leadership bench. We promoted Paula Hanson to president earlier this year, welcomed Keith Pierce as our new Chief Marketing Officer, and recently added Lucas Moody as our new Chief Information Security Officer. We are committed to our vision of democratizing data analytics for all, and our highly differentiated low-code, no-code, end-to-end analytics platform continues to resonate with our customers and prospects. Our strong results further bolster my confidence in both our go-to-market strategy and our innovation path ahead. I'll begin with some financial highlights, followed by an update on our product innovation momentum and go-to-market strategic initiatives. Annual recurring revenue, or ARR, of $684 million grew 33% year-over-year, reflecting the fourth consecutive quarter of accelerated year-over-year growth. Revenue of $158 million grew 33% year-over-year, a reflection of strong underlying tailwinds from our large customer cohorts. We had a record Q1 in terms of number of $1 million ACV deals, double that of Q1 last year. And as a great early proof point of Paula's enhanced go-to-market motion, I'm delighted to share that we secured another eight-figure TCV win with the Fortune 100 financial services organization that more than doubled its contract value as it expands its Alteryx use to new teams and global markets. We expect more to come as we continue to win with large enterprises across a wider range of personas than ever before. Simply put, the results were fantastic, and I'm so proud of the entire Alteryx organization. Earlier, I highlighted a couple of key additions to the leadership team, and we have seen parallel trends of strengthening the team throughout the organization. The best leaders attract top talent. we're benefiting from a virtuous cycle of high-quality team expansion with employee retention rates at the highest level in over a year. We also welcomed over 200 employees from Trifacta whose deep industry skills continue to strengthen our cloud capabilities. I'm confident that with the right leadership team in place and a rapidly expanding pool of skilled talent, the company is well-positioned to capitalize on the attractive market opportunity ahead of us. And that data analytics market opportunity is massive. According to IDC, there is $65 billion in annual spend today, and that is projected to exceed $110 billion by 2025. This is a market defined in large part by spend on disparate, siloed legacy data engineering and analytic tools. In Q1, we benefited from a continued increase in customer demand for a more comprehensive, unified analytics platform. In addition, a separate study we commissioned with IDC indicated that a significant volume of data analytics is still happening primarily in spreadsheets. This study highlighted that across nearly 80 million advanced spreadsheet users, over 60 billion hours per year are wasted in unsuccessful or repetitive data analytic efforts. Meanwhile, we are beginning to see enterprise digital transformation at a global scale. which is creating incremental opportunities across a range of new personas, including data engineers, business analysts, and often the business executives themselves. Large enterprise companies are embracing digital transformation and are in the early stages of their journey to become data-centric organizations. This generational shift towards data literacy is creating urgency for companies to upskill their workforces to embrace data, extract insights, and unlock new opportunities to drive growth and create value. These dynamics create three key opportunities for Alteryx with respect to the addressable market. One, we can gain share in a tangible $65 billion market that is ripe for modernization. Two, we can expand the addressable market by empowering spreadsheet users with our low-code, no-code analytics platform. And three, We can meet the incremental demand of new personas emerging with this underlying wave of digital transformation. This aligns perfectly with our vision of democratizing analytics for all. Global demand for data analytics is ramping, and we have strategically aligned the company's product innovation and go-to-market motion to meet this meteoric opportunity. It begins with our flagship designer solution, which has long established Alteryx as a leader in the data analytics industry. Our unique offering of rich enterprise analytic capabilities with a low-code, no-code user interface continues to be a key driver of our success. For our customers, the operational efficiencies that Designer provides are transformational. Time and again, our customers leverage our solutions to optimize processes that take multiple hours, if not days, into workflows that execute in a matter of minutes. And the fact that we can empower a business analyst that has no coding expertise with these capabilities is career changing for our users. We take great pride in the level of engagement and enthusiasm across our user community of well over 300,000 users. As we look to the future, we are committed to providing true end-to-end analytics capabilities. This begins with the expansion of our product offerings to include new cloud-based solutions. In Q1, we launched our cloud offerings in North America, Designer Cloud, Alteryx Machine Learning, and Alteryx Auto Insights. And of course, we completed the acquisition of Trifacta, which both expands our data engineering capabilities and enhances our ability to drive meaningful workloads into and within cloud data warehouses. On that note, our journey to unifying analytic apps on the Trifacta platform is progressing very well. We expect to have some milestone updates to share soon. As we are now equipped with a comprehensive breadth of cloud-based offerings, we are excited to have recently launched Alteryx Analytics Cloud Platform. This platform approach will enable customers to access our complete cloud offering portfolio through one unified solution suite. We believe this consistent user experience across our portfolio of solutions will foster cross-team enterprise collaboration as new personas embrace data analytics. In addition, providing access to our complete suite of offerings in a single interface should nurture multi-product engagement and accelerate our customers' ability to upskill their broader workforces. While still early on, we're pleased with the customer interest and initial pipe gen. In fact, we already have one of our larger Global 2000 customers on track to implement multiple cloud solutions this quarter. Demand is ramping, and we have a highly differentiated, expanded product offering that is resonating with our customers. With that in mind, it's important to complement our innovation strategy with a targeted, scalable go-to-market motion. The first key initiative here is amplifying our sales focus on larger enterprise companies. Building off the solid foundation of enterprise business, we've significantly expanded and focused our enterprise sales team over the past year. As these sales reps ramp, we find ourselves engaged with customers at a more executive level and across a broader range of user personas. This top-down strategy complements our land and expand motion of seeding smaller wins to expand over time. Only, we are now seeding fields of opportunities across entire organizations. We're seeing success with this strategy in landing new large-scale wins, as well as with favorable expansion trends within the customer base. In terms of new Global 2000 wins, we had a strong quarter, including several marquee companies such as AES, Boston Properties, Credit Agricole, Investec, and Voya Investments, among others. In fact, our Global 2000 penetration expanded by roughly six points year-over-year to 45% in Q1. In Q1, Lato Hessen, a German-based digital lottery provider, selected Alteryx to empower its marketing team with enhanced customer analytics and visibility. The ease of use, depth of analytic capabilities, and flexibility to integrate with other enterprise workflows were key drivers of this win. We are so excited for Lato Hessen as they begin their journey with Alteryx Designer and Server. We're also seeing success with our enterprise motion via net expansion with our global 2,000 net expansion rate once again at 128% this quarter. Another positive customer journey example is with Optus, one of the largest telecommunication providers in Australia. Optus has broadened its implementation of Alteryx solutions across multiple departments in recent years and is now empowering its network team with rich insights as they plan for 5G infrastructure deployment. Optus has done some amazing work in driving efficiencies with Alteryx and also optimizing customer facing experiences with tangible results. The second key initiative in scaling our go-to-market strategy has been partnerships. We have a thriving ecosystem of partners across solution providers, distributors, and global systems integrators, as well as with technology and OEM partnerships. Earlier this year, we announced an updated partner program that further empowers this community to effectively bring Alteryx solutions to the global markets and elevate user engagement. We had a great partner-led new logo win with a multibillion-dollar Canadian-based information management company. In working with one of our global elite GSI partners, this customer is implementing Designer within its tax organization to unlock significant efficiencies in terms of time and cost savings. And more often than not, our larger partners are customers themselves. In Q1, one of our sizable partners expanded its own Alteryx 1000 Plus license implementation to include new predictive capabilities in greater capacity. What an endorsement it is to see our partners more deeply embrace the Alteryx platform to drive efficiencies within their own businesses, as well as for their customers. Before passing the call over to Kevin, I'd like to take a moment to address the unconscionable war being waged on Ukraine and its citizens. Our focus is on the safety and wellbeing of our employees. We have approximately 40 employees based in Ukraine, and we have actively worked with many on relocation. And while we do not anticipate a meaningful impact to either revenue or operational workflow, we are humbled by the courage and commitment shown by our colleagues and their families. We will continue to support their needs through this difficult time. In closing, we delivered an outstanding first quarter, and we're off to a solid start for FY22. I firmly believe this is just the beginning. We have a massive market opportunity that is very much in need of democratized analytics for all. We have an expanded portfolio of solutions that are now unified in a single cloud-based platform. and we have a scalable, enterprise-focused, global go-to-market motion. I'm so proud of what the team has accomplished, and I'm energized and excited by what's to come. With that, I'll turn the call over to Kevin.