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spk03: Good day. My name is Savannah, and I will be your conference operator for today. At this time, I'd like to welcome everyone to the AnnaPlan fourth quarter fiscal 2022 earnings conference call. Today's call is being recorded. Please be advised that the IR website vendor is experiencing intermittent website access issues, and we are aware of that and apologize for any inconvenience. All lines have been placed on mute to prevent any background noise. And after the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, please press star one on your telephone keypad. Thank you. I would now like to turn the conference over to Vikram Khosla. Please go ahead.
spk11: Good afternoon, and thank you for joining us on today's conference call to discuss Anaplan's fourth quarter fiscal year 2022 financial results. Joining me on the call are Frank Calderoni, our Chief Executive Officer, and Vikas Mehta, our Chief Financial Officer. On today's call, we will review our fourth quarter and full fiscal year 2022 financial results and discuss our financial guidance for the first quarter and fiscal year 2023. Please note that some of the information discussed on the call Particularly, our guidance is based on the information as of March 2nd, 2022, and contains forward-looking statements that involve risks, uncertainties, and assumptions, including those related to the continued impact of COVID-19 on our business and global economic and geopolitical conditions. The guidance we will provide today is based on our assumptions as to the macroeconomic environment in which we will be operating. Those are today. Many of these assumptions relate to matters that are beyond our control and changing rapidly, including but not limited, to the scope and effectiveness of precautionary measures designed to contain and prevent the spread of COVID-19, the continued impact of COVID-19 on customers' purchasing decisions, and the length of a sales cycle, particularly for customers in certain geographies. Please refer to documents we filed with the SEC, including the Form 8K file with today's press release. Those documents contained risks and other factors that may cause our actual results to differ from those contained in our forward-looking statements. These forward-looking statements are being made as of today, and we disclaim any obligation to update or revise these statements. When this call is reviewed after today, the information presented during this call may not be current or accurate. We will also discuss non-GAAP financial measures, which are not prepared in the current generally accepted accounting principles. Unless otherwise stated during the call, all references to our gross margins, expenses, and operating results are on a non-GAAP basis. For historical periods, a reconciliation of GAAP and non-GAAP results is provided in the press release and in supplemental financial information on our website. And with that, I will turn the call over to Frank.
spk04: Good afternoon, everyone. Thank you, Vikram, and a warm welcome to AnaPlans. Vikram is our new VP of Corporate Finance, and we are very happy to have him join the team. Before we begin, I would like to take a moment to acknowledge what is happening in the Ukraine. We are devastated by the events unfolding, and we support those who are personally impacted by this heartbreaking situation. Now turning to our results. Anaplan delivered a very strong fourth quarter. We finished the year with over 1,900 customers and we had the highest ACV and net new ACV growth in three years. I am proud that our RPO this quarter grew 34 percent year over year, resulting in an RPO balance of over $1 billion. As we start the new fiscal year, we remain confident in the large opportunity ahead and our ability to execute. A Q4 highlight was the record number of deals over $1 million. which demonstrates the strong demand for connected planning, especially with the Office of the CFO, where software spend remains a high priority. In fact, in Q4 alone, the number of million-dollar deals equaled what we had in all of fiscal year 2021. This was driven by outstanding expansions, contributing to 78% of new bookings mixed. We also had the highest land bookings growth in the last two years. We continue to experience increasing demand for use cases within finance, supply chain, and sales performance management. This is a clear indication of how today's challenges are being solved by connected planning for some of our largest customers. Last month, we held our annual sales kickoff to drive our FY23 go-to-market strategy, and the energy was inspiring. We have grown our sales capacity through fiscal year 22, and we brought in exceptional new sales talent. We have also elevated longtime high-performing sales leaders. We feel good about our pace of hiring and ability to meet the increasing demand in FY23. Bill Hsu and his team are driving four pillars of excellence. First, by elevating the go-to-market motion. Second, by building a scalable and efficient land motion. Third, by creating a world-class adoption and delivery model. And fourth, by investing in key partnerships. Our first pillar is elevating our go-to-market motion. This is where we engage with C-suite executives to drive strategic digital transformations. As I speak to these executives on a regular basis, they need an all-in-one planning solution. The latest disruptions, whether it's continued supply chain challenges or massive talent turnover, are causing unprecedented shifts that need to be planned quickly with agility. Our elevated go-to-market motion is highlighted with our transformative land with ODP Solutions, also known as Office Depot. This customer is undergoing a strategic transformation, leveraging its B2B assets to support an increasingly dynamic end market. This requires constant evolution to drive performance, and they are modernizing their sales compensation management to be prepared for these changes. ODP Solutions selected Anaplan for the ability to scale and meet the future needs of the business. Our second pillar of building a scalable and efficient land motion is geared to accelerate new logo acquisitions. We welcome Manchester University NHS Foundation Trust, Vitality Health Limited, TwinStar Homes, and Europecar International SASU. Our platform provides critical scenario planning to enable smarter decisions for a variety of customers and industries. An exciting land this quarter was the largest deal in Canada with the Government of Ontario. We will support the financial community in the overall management of Ontario's fiscal plan. Ministry plans, budgets, and forecasts will be developed and managed within Anaplan, which is expected to lead to better financial management outcomes. Advanced Pharma is another good example of a scalable land. This customer is a specialty pharmaceutical company which supplies to over 90 countries with more than 200 types of medicines across the multiple therapy areas. They wanted to broaden their access to complex medicines while maintaining agile and efficient operations. This customer set out to optimize their supply chain operations, selecting our data-driven platform to help bring greater resilience to the company's network. Our ability to interconnect demand signals with supply chain outcomes in real time and to model various what-if scenarios were deciding factors in selecting Anaplan. We also landed an S&OP win with Bobst. This company is one of the world's leading suppliers of substrate processing, printing, and converting equipment and services to the packaging industry. The company selected Anaplan as its global sales and operations planning solution to enhance collaboration between sales, supply chain, and service teams. With a scalable and flexible platform, this customer will have a dynamic and integrated view of customer demand. BOPS can adjust resources, evaluate financial impacts of changes to demand and capacity, and reduce manufacturing and resource costs to help drive increased revenue. Our third pillar of creating a world-class adoption and delivery model was driven by our expansion metrics of strong customer health and natural expansion opportunities. This quarter, by delivering strategic value, we are deepening our relationship with existing customers such as Autodesk, Bayer, Adobe, Jaguar Land Rover, Nomura, Ricoh, and L'Oreal. These customers span across multiple industries and geographies to help further the digital transformations. Solvay, a global leader in materials, Chemicals and Chemical Solutions is undergoing a finance transformation to break down silos, increase efficiency, and enable a customer-centric approach. The company expanded their use of Anaplan from zero-based budgeting to integrate workforce cost planning and budget consolidation and planning. This enables end-to-end financial planning on a single platform. Sleep Number also expanded with Anaplan with PlanIQ this quarter. They use Anaplan for demand planning and has expanded to include use cases in sales and operations, workforce, and supply chain. The company is furthering its connected planning journey with PlanIQ to deliver greater accuracy across top line, product level, and market level sales forecasting. Sleep Number can forecast daily across sales planning demand planning and store staffing to get deeper insights and run multiple scenarios related to its seasonal promotions. Finally, our fourth pillar is investing in key partnerships. Our partner ecosystem provides opportunities to further differentiate our market-leading solutions and to drive more demand for our offerings. This quarter, Partners participated in 18 out of 20 of the largest Net New ACV deals worldwide. And Net New ACV, sourced by GSIs, was more than any quarter since Q1 fiscal 21. Our partners continue to invest and hire Anaplan skilled resources, which is a testament to the level of customer interest they're seeing in the market for enterprise-grade planning solutions. Major partners see opportunities to gain a larger footprint with customers by working with Anaplan. We recently expanded our long-term strategic collaboration with Microsoft. This brings together the predictive intelligence and advanced modeling capabilities of our sales solutions with planning, incentives, and insights with Microsoft Dynamics 365. With Anaplan and Microsoft, Sales leaders can build a data-driven go-to-market strategy by leveraging company and third-party insights to model market scenarios and create accurate revenue forecasts. These insights can also help leaders design cost-effective sales incentive programs. I think this relationship is going to make a major impact to our customers who have large, expansive go-to-market teams. Our partner ecosystem also helps us go deeper with our customers in strategic ways. One great example is through our partnership with Deloitte, who has successfully delivered differentiated ESG solutions to Anaplan customers. These sustainability models are critical to supporting their ESG vision through environmental and social-related planning and reporting. We also partner with BCG to bring similar solutions for our mutual customers. In fact, I was recently speaking to a CFO of a $7 billion global consumer product company who is interested to learn more about our carbon emissions management and other ESG-related initiatives with our solution. Our industry-leading platform is helping mitigate risk, allowing customers to plan ahead and predict what is needed. Another lever within our growth strategy is our cloud partnership with GCP and AWS. These relationships have been instrumental for us to scale quickly and broaden our reach. We closed several deals on GCP Cloud, both in the U.S. and Japan. We also launched on AWS Cloud in November, and we have started to make progress, closing our first deals this quarter, one of which was over $1 million. And finally, with the increased usage of our platform solutions, there is a constant need for more skilled Anaplant experts. Our ecosystem of talent continues to grow with the total number of certified model builders increasing over 90% year-over-year. From a customer perspective, over one-third of them currently have a center of excellence with the number of COEs up over 65% year-over-year. To recap, our four go-to-market pillars of excellence drive both growth and efficiency, and we are confident in our ability to increase demand for our solutions to our customers. Now onto our innovation. We know that one of the biggest drivers behind our growth and continued customer adoption is our relentless focus on innovation. As I mentioned last quarter, we are committed to the next level of connected planning. and remain leaders in this space, outpacing our competition. We introduced the concept of the autonomous enterprise to extend our platform with embedded intelligence capabilities and simplify complex problems across large enterprises. Our strategy is to help our customers plan, analyze, and act in an autonomous system that is unified to drive AI and ML intelligence. With this investment in the next stage of planning, we can further our customer success with greater agility, intelligence, and automation within one sophisticated platform. In summary, Anaplan delivered a very strong finish to the fiscal year in Q4, adding over 100 customers, closing a record number of million-dollar deals, and achieving our highest ACV and net new ACV growth in three years. I am proud of our performance. We are well positioned within our growth strategy, strategic partnerships, talented employees, and the next level of innovation to take advantage of the opportunities ahead. Moving into FY23, we feel confident as leaders in our space to focus on investments in our go-to-market motions and build upon our platform differentiators. We offer immense value to our customers, and we are committed to delivering the most innovative planning solution. I'd like to take a moment to thank our employees for their continued tenacity and commitment. You are the reason for our results, and I appreciate what you bring every day. Now let me turn over the call to Vikas, who will discuss our fourth quarter and full fiscal year financials and provide our outlook for the first quarter and fiscal year FY23. Vikas? Thank you, Frank.
spk02: I would also like to welcome Vikram to Anaplan. I'm pleased to report our fourth quarter and full fiscal year 2022 results. We exceeded the high end of our guide across all our guidance metrics for the quarter and the fiscal year. Total revenue for the fourth quarter was $163 million, up 33% year over year. Within this, subscription revenue grew 32% and comprised 91% of total revenue. Service revenue of $15 million was 9% of the total revenue. Total revenue for the fiscal 2022 was $592 million, up 32% year over year. From a geographic perspective, international operations, which we define as EMEA and APAC businesses, represented approximately 45% of total revenue. We saw broad-based year-over-year growth across all regions, with Americas and MER revenue of 32% and APAC of 36%. As Frank mentioned, we closed a record number of million-dollar deals this quarter. We now have 555 customers with ARR over $250,000. representing 23% year-over-year growth. Additionally, the number of customers with ARR over 500,000 and 1 million increased 28% and 45% year-over-year, respectively. Dollar-based net expansion rate, or NRR, was 118%. Adjusting for FX, NRR would be 120%. This is a testament to upsell success in the install base as well as market validation of the need to extend planning to other areas. Looking at our performance metrics, for the fourth quarter, our billings on a constant currency basis was $224 million and calculated billings was $221 million. Calculated billings growth for the quarter was 28%. As you may recall, last year Q4 included a multi-year billing and FX tailwind. Adjusting for this one-time multi-year billing and current FX headwind, billing's growth was 32%. Remaining performance obligations, or RPO exiting the fourth quarter, was $1.1 billion, up 34% over last year. Driven by the strong CRPO bookings growth rate of 36%, the current portion of RPO that is expected to be recognized as revenue over the next 12 months is 545 million, up 30% year-over-year. Overall, RPO performance reflects long-term customer commitments, the execution of our field, and strength of the platform. As discussed last quarter, we expect to see continued variability in calculated billings and CRPO bookings growth rates based on differences in the timing of large deals, timing of billing versus booking, early renewals, and off-cycle renewals. We recommend looking at trailing 12-month billings and CRPO bookings metrics, which will help normalize for these timing differences. On a trailing 12-month basis, billings grew 30% and CRPO bookings grew 32% year-over-year and is a clearer indicator of the underlying growth in our business. Turning to margins, fourth quarter total non-GAAP gross margin was 75%. Within this, subscription gross margin was 82% and services gross margin was approximately 1%. For the year, total non-GAAP gross margin was 76%. As we have said previously, over the near term, our gross margin will include the initial impact of a gradual increase in the cost of hosted services as we ramp our public cloud usage on AWS and GCP. As Frank mentioned earlier, we are beginning to see good traction from our cloud partnerships. Non-GAAP operating margin for the fourth quarter was negative 6.5%, reflecting an over 100 basis point improvement compared to negative 7.7% in the same period last year, reflecting better sales productivity. For the full fiscal year, non-GAAP operating margin was negative 6.9%, representing improvement from negative 8.6% in the prior year and demonstrating progress towards our financial objectives of improved productivity and profitability. Non-GAAP net loss per share in the fourth quarter was negative 11 cents, based on 148 million weighted average shares. Turning to the balance sheet and cash flow, free cash flow for the quarter was negative 22 million and we exited the quarter with approximately 300 million in cash and cash equivalents. Moving to our outlook, we expect first quarter fiscal 2023 revenue in the range of 164.5 to 165.5 million. Within this, we expect services revenue to be in the range of $14 million to $15 million. This is within our target range of approximately 10% of total revenue. Non-GAAP operating margin for the first quarter is expected to be in the range of negative 7.5% to negative 6.5%. As a reminder, our Q2 spend is seasonally higher, reflecting investment in marketing, return to travel, and in-person events, including our annual user conference in June. Turning to CRPO, we expect first quarter growth of 26% year-over-year and increasing growth rates in the second half of the fiscal year. Keep in mind that the two primary drivers of growth are net new bookings and the timing of renewals. For the full fiscal year 2023, we are increasing revenue guidance to $745 million, up from $730 million. We have a high level of confidence in our FY23 outlook, as we already have 73% of our FY23 revenue guide in CRPO. We expect non-GAAP operating margin for the full year to be in the range of negative 3.5 to negative 4.5% as we drive improved operating leverage and a path to break even in Q4. Finally, weighted average share count for the first quarter and full fiscal year is expected to be approximately 150 million shares and 152 million shares, respectively. Demand for connected planning remains strong. Our customers are choosing Anaplan to address their most complex needs in today's volatile environment. With that, let's now open it up for questions.
spk03: Thank you. And as a reminder, we have a star one to ask a question. And we do ask that you please limit yourself to one question. We will pause for a moment to compile the Q&A roster. And our first question will come from Ramo Lenshow with Marclays. Please go ahead. As a reminder, please unmute before you ask your question.
spk11: to move to the next question.
spk03: And we'll move to Terry Tillman with Truth Security. Please go ahead.
spk06: Yeah, thanks for taking my questions. Welcome aboard, Vikram. Hi, Frank and Vikas. Hi, Terry. My question and follow-up is this following. It's great to hear about the record million-dollar-plus deals. I think last quarter, It was definitely light. I don't think you had much activity there. But I think you were indicating you had a good pipeline. So kind of what was the tipping point? What was the catalyst for the improvement in million-dollar deals? And how does that feel as we move into the first half of the year in terms of that pipeline? And then the follow-up question for Vikas is, could you give us a little bit more specificity on, I think you said CRPO could actually accelerate in the second half, which is good to hear from the 26%. But any more color there? Thank you.
spk04: Yeah, good question, Terry. So first, very pleased, as I said, about the performance in the Q4. Nice way to end the year and also the overall performance of FY22. I think we've been talking now for a while about the importance of, let's say, some of the large transactions that we're seeing in the market. And I would say they continue to improve. And I think they're continuing to improve primarily because of some of the secular trends that are happening. If you look at... really what's going on as far as the data modernization, some of the transformation. I think that's increasing, and I think that's going to be here to stay for a while. I think, secondly, with all the, I'd say, disruption that we've all seen in the last two years, when you think about how leaders are looking to manage a lot of this disruption, this change, and have the agility, they're looking to transform their business. And I think when you look at million-dollar deals, it's an indication of an organization really sponsored by one of the executives that is moving forward with some of these transformations. And we've seen them, you know, as I said, continue to improve throughout this past year and increase both in those that we closed in Q4 as well as even pipeline that we came into fiscal 23. Again, I see those trends continuing. I think, you know, I pulled some information even just getting ready for this call, looking at some of the financial trends transformations back to this past fiscal year where CFOs or heads of FP&A have been working with Anaplan to drive those transformations, driving a lot of those larger transactions, specifically with Expand. And the number of those transactions in 22 was up substantially from where they were in 21. And again, as I said before, a healthy pipeline going into 23. So I feel good about the trends. the macro trends, the secular trends that are driving this in the right direction.
spk02: Terry, let me add to Frank's comments. Let me start by saying that, first of all, we feel great about shifting to the CRPO guidance metric. Clearly, this helps reduce the duration and timing noise that is there in billing. As you think about CRTO going forward, there are two factors that are important to understand. First is renewal, and second is the new bookings. As we have shared last quarter, we had in H1 FY21 an impact on the renewal base because of And given our two-year renewal cycles, our H1 will overlap and have the impact from that. As you look beyond H1, as we shared, the CRPO is expected to increase and will be more normalized going forward.
spk03: And our next question will come from Alex Zukin with Wolf Research. Please go ahead.
spk07: Thanks for taking the question. I guess just to start, could you talk a little bit about what you're seeing both out of the demand and competitive environment as we exit COVID here? If you think about, you know, returning to a pre-COVID type pipeline from an execution standpoint and, you know, just talk about the competitive environment, what you're seeing from opportunities that you're seeing and where the difficulties are.
spk04: So, Alex, I think, you know, I'll reiterate what I just mentioned as far as the demand. I think the demand signals are strong. And as I said, you know, driven by really the back office modernization, the digital transformation trend, seeing that accelerate, let's say, over the last few quarters and position for, you know, going forward over the next few years. And then the macro with the volatility that's going on and the change in businesses really driving the need for agile planning. So when I step back and look at the demand signals, they continue to improve. And as I said, I think they're going to be here to stay. When I put that in the framework of the competition, first, before I get there, I'll say that I believe that in order to go after that demand from an Anaplan perspective, we have the go-to-market capacity for some of the growth priorities I mentioned earlier and how those are gaining traction to be able to continue to go after that opportunity. that demand. And I think that from a differentiation perspective, our platform, which has been pretty much a leading platform now for a number of years that we're continuing to invest in and innovate as we think about the next phase beyond connected planning, I think allows us to really position the platform and our go-to-market very strongly to address any competitive situation out there. On the competition, as you would expect, we want to make sure that we're obsessed and also inspired by competition. We want to be aware of what's happening at all levels and use that as a vehicle to push ourselves, both in going after the opportunity, as I said, as well as making sure we continue to innovate the platform. And I think there's a lot of proof points out there by a lot of the – industry research analysts that look at the different, whether you look at finance or supply chain or sales performance management, with an identified and applying clearly as that leader, you know, pioneering where we were with connected planning and then continue to develop. So I feel really good about our competitive position, and we want to make sure we continue to push ourselves to do even better.
spk03: Our next question will come from Remo Lynch. How was Barclays?
spk10: Thanks for squeezing me back in. Thank you very much. Frankie, in the past, we talked a lot about kind of renewal portfolios. And, you know, you're going now against like cohorts from the pandemic where you back then didn't have a lot of kind of new customers. So looking at your comments and your guidance, et cetera, it looks like the new customer business is really kind of picking up and pipeline is building here. Can you kind of talk a little bit about that dynamic, you know, what we saw in Q4 a little bit because you went into that Q4-19, but then also for Q1, Q2 in the new year? Thank you.
spk04: Raymond, a really good question. I can answer it in a couple of different ways. So, first, I would say that, you know, if I go back and look at the – The situation that we've had here, we've continued to kind of look at new customers as a top priority. And I think it's proven when you start to think about the ability for us to expand with customers. And you can't expand unless you continue to get new customers. This quarter, we have been very focused. We've made some additional investment. You heard that I made some statements earlier. about continuing that investment into FY23, one of Bill's initiatives as far as making sure that we have scalable land. Any land that we get, regardless of the size, including small, allows us to start to demonstrate the value that the platform can provide. And we've seen time and time again, especially over the last couple of years, that the expansion, once we get that, is huge. And so we are focused. We're making the investment. We've aligned the team for FY23 to be able to do that in our geographies. And I expect, you know, the performance in Q4, having over 100 customers and quality customers, allows us to take that even to the next level.
spk03: And our next question will come from Jeff Hickey with UBS. Please go ahead.
spk00: Hi, yeah, this is Taylor McGinnis. Thanks so much for taking the question. Frank, maybe going off what you just last said, so obviously a strong year for new land. So can you talk about how that sets up dollar basement expansion rate and that trajectory as we look ahead? And maybe as a part, you know, to this question, when we think about the outperformance in 4Q, how much of that was driven by deals, you know, becoming unstuck over this past year versus maybe, you know, net new deals coming into the pipeline?
spk04: Yeah. So, Taylor, as far as the ability for the expansion, as I said, it's one of our great strengths with the platform that we have and the ability to not only finance but also to address the connectedness of our platform across the different functions. And, you know, especially with what we've seen more recently, as I said, with the disruption that's occurring, I think, and if I even just stay on finance and focus on the comment I mentioned before about the long list of impressive finance transformation deals that we've had this year where it's truly identified as finance transformation, the ability for us to upsell the platform, not only in finance, but to allow finance professionals to leverage information throughout the supply chain from a planning standpoint or leverage information into and out of the sales organizations makes the CFO and the finance team much more effective in what they need to do to help not only report but help analyze and manage the business. And then it allows the other end standpoint in the process to really participate effectively. And so when I look down, I've got the list in front of me of the quality expansion finance transformation deals that have, you know, extended within finance but also have touch points into other parts of the function, it's quite impressive. And I'll repeat what I said before. The growth in those transactions from an ACV perspective and even from a number of customers is up substantially year on year. So I think that's a good point to really kind of demonstrate the potential going forward for these types of expands. Now, the lands, as I said before, are critical, right, as we think about not necessarily the next year, but let's say two years out, three years out, which is why we want to make sure we emphasize. And I think, you know, throughout the early part of COVID, in those quarters, you know, we did have like a pullback in spend from various customers. And the pullback in spend was really on new transactions. And so what we did is we emphasized working with existing customers on the expansion, and that really proved out well. Now we have the ability to do both, and we want to make sure that we continue to leverage. And that's why there's two key pillars of Bill's, you know, go-to-market growth initiatives for FY23 and going forward.
spk03: And our next question will come from Brent Till with Jeffrey. Please go ahead.
spk05: Good afternoon. Just on the number of million-dollar deals, I think in Q3 you had a few deals that kind of slipped out. Did you close all those deals in Q4 or are some of those deals still remaining?
spk04: It's always an ongoing. You know, it's hard to really say. That's why I never really say about flipped deals. When you're dealing with large transformation deals, right, and, you know, there's a good side of it, like for what I just said in the last two or three responses to the questions. because it allows us to really make a difference providing value to customers, and it becomes sticky for us, right? They're making big investments. Those big investments take time, especially when you're dealing with enterprise and G2K customers. I was there myself several years ago. You've got various parts of the organization that need to weigh in. And as I said before, those transactions or those deal cycles can go from six months to 12 months. And it's hard to gauge because sometimes you think you have a closed deal, and at the last minute, someone from legal or someone from procurement comes in and raises an issue, and that could add a couple of weeks to the schedule. So it's a constant ebb and flow. And so that's why I kind of step back. And now that we closed the fiscal year, and I look back over the year, and I'm quite pleased with the number of deals that we were able to close and feel good about the ability to kind of continue that going forward.
spk02: Yeah, I'll quickly jump in as well, Brent. And the key thing that we look in those big transformation deals is to getting the right deal done, right deal done for the customer, right deal done for Anaplan as well as our shareholders. So we really don't try to forecast, you know, large deals by quarter. Rather, we really want to make sure that they drive value for the customer as well as Anaplan.
spk04: I want to add one more thing I was going to say before Vikas came in. You know, the other thing which I will say, which I think is a positive also, when you have these large transactions with enterprise accounts, and this also addresses the competitive question earlier, these companies run RFPs, and we're seeing RFPs. And that's where we're competing. One, RFPs can be a lengthy process. And two, they usually have a large number of participants. And that's why it makes me feel good that despite the number of participants in those RFPs, we've been successful from a competitive standpoint for all the reasons I said before to win these deals.
spk03: And our next question will come from Stan Blosky with Morgan Stanley. Please go ahead.
spk09: Perfect. Good afternoon, guys, and congratulations on a good end to the fiscal year. I wanted to dig into two quick areas. One is, you mentioned on the call and we also heard in our channel chat that you guys went through some reshuffling on the sales organization side. What precipitated the change? You've had a lot of stability in the sales organization. Why making the changes and what was the overall spirit behind the changes? And then just on the CRPO guidance, the way we should think about CRPO guidance, is the methodology and the framework they used for setting CRPO guidance similar to the framework they used for billings in terms of the goal to deliver upside and setting conservative targets? Thanks, guys.
spk04: So, Stan, I'll start with the first part of your question. I'll say this, and having been around for so many years, and especially working very closely with sales organizations, I think every sales organization at the start of the fiscal year goes through some change, and there are different levels of change. And so part of starting FY23 and finishing FY22 on a high note allows us to start to raise the bar, right? And I would expect all of you would want us to do that. Bill's been with us now over a year. And as I mentioned when we announced Bill back in Q4 of last year, that we want to hold, you know, the organization was running pretty well, and Bill was going to continue to keep that moving, but also have an ability to influence, learn, see what areas that needed some additional focus and attention and investment. And Bill has done a great job over this past year doing that. And that's why in the prepared remarks earlier, I felt important to lay out the four pillars of his excellence plan going forward, some of which he's already put in place over the past quarter or two. And that's making sure that we are selling outcomes up to the highest level in the organization of our customers, a la the ability to drive large transformational deals. Secondly, to look for opportunities to accelerate sales. new logos so that we have the base to expand later. Third, to make sure that we keep that fantastic engine that we have with our CS organization, our partners, and others, the sales team, on the expands and working with our customers to continue that moving in the right direction and getting even more focused on some of the data and metrics that drive even more effectiveness there. And then last, and this continues to, you know, in the five years I've been part of Anaplan, I think about the partner ecosystem, where it was five years ago to where it is right now. It continues to evolve and grow and expand, and Bill's doing even more of that. One, bringing in some of the talent to head up some of these efforts, but also making sure that the processes, the focus, the attention is there for us to take things to the next level.
spk02: And I'll jump in, Stan, for your second part question on CRPO. No change in the guidance philosophy.
spk03: And our next question will come from Scott Berg with MeTAM.
spk08: Hey, everyone. This is Michael Rackers on for Scott. Thanks for taking my question. Could you give us a bit more color on the partner involvement in the quarter and then maybe what this looks like internationally as well?
spk04: Partners, so, you know, we usually have a very healthy participation with our partners. So when I first talk about our partners, let me just start with the, let's say, the GSIs and the various other, you know, go-to-market partners that we have that have been, you know, successful working with us. We continue to see strong alignment with them where they're driving more than 50% or participating in 50%. I gave some stats earlier as far as even the top deals, 18 out of the top 20 were participating in those large transactions. So they continue to help us, support us, support their clients, their customers, to be able to effectively consult with them to drive a lot of these projects and transformations further along the way. They're investing. They've been investing substantially. I have a little bit more time. I know that various programs that we are doing along with our partners to make sure that we enhance the Anaplan skills resources at partners, at Anaplan, but also at customers. efforts that we're doing there, and I think we're showing progress. I gave some of the stats as far as the number of COEs that we have and the growth year-on-year, over 65%. So that all, I think, is moving in a very healthy, positive direction. The other area of partners is the cloud partners. I talked about both GCP and AWS. You know, it took us a while to that they port our platform onto the cloud. We successfully have been able to do that. Now we're starting to leverage that from a go-to-market perspective with GCP and AWS, where their sales teams are now selling the platform jointly with Anaplan. And I mentioned some of the transactions in the quarter, both with GCP and AWS, nice ones, sizable ones, that we feel good about allowing us a good start for FY23, and that is part of our plan, especially as we go further into the year for FY23 of opportunity. The concentration with those partners primarily right now is in the U.S., Canada, and Japan, and we'll continue to evaluate other geographies as things unfold. So really feel good about that.
spk03: Then our final question will come from Daniel Jester with VMO Capital Markets.
spk01: Thanks for squeezing in. Can we just expand on the public cloud comments you just made there, Frank? Are you seeing specific strengths in regions or use cases or, like, type of clients? Can you just help us think about, like, what that could be in the year ahead now that you're through a lot of the technical heavy lifting? Thanks.
spk04: So the regions are, as I mentioned, so U.S. We just moved into Canada at the end of the year, and we had some transactions, let's say, middle end of year in Japan. So those three regions are the focus at the moment. In those regions, you know, the initial leverage, so some of the deals that we've had have been with existing, I'll take GCP as an example, where there were existing Google customers. that were able to bring, they brought Anaplan into those customers who were working on transformational initiatives around planning. And so together, also with the GSI, GCP, and Anaplan, we were effective in working through that. I think in the previous calls, I was able to mention some. You know, we had Ford Credit was a great one with GCP. I'm trying to make sure in my head. I'm trying to remember which ones we have approvals to talk about. But there are some other impressive ones that we had. With AWS, as I said, we just started with them in November, December, so it's early. But even early, we got a pretty nice deal with a retailer. That was a very beneficial, a finance transformation deal that is going to allow us now several years of enhancement and also expansion. An existing customer of Amazon or AWS, that also was able to bring Anaplan in on the planning side to leverage some of their activities.
spk03: And that will conclude today's question and answer session. I would now like to turn the call back to Frank Calderoni for any additional closing remarks.
spk04: Thank you, everyone. I appreciate your support of ANAPLAN on the call, but also throughout the quarter. And we look forward to connecting with you again next quarter. Thank you.
spk03: And this will conclude today's conference. Thank you for your participation, and you may now disconnect.
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