This conference call transcript was computer generated and almost certianly contains errors. This transcript is provided for information purposes only.EarningsCall, LLC makes no representation about the accuracy of the aforementioned transcript, and you are cautioned not to place undue reliance on the information provided by the transcript.
spk_0: good morning good morning welcome to college years third quarter twenty twenty one your earnings by are you running from will be discussing the results and nelson are personally us issue or prior to the market opened want to posted on our investor relations close and during the color and we all make statements regarding our business that may be considered forward looking or within a polygamy securities laws including statements regarding or fourth quarter of fiscal two thousand and twenty one years old management's expectations for future financial or an operational performance supported or and other statements regarding our planet's prospects and expectations these statements are not promises are guarantees and are subject to risks and uncertainties discourage could have caused little tougher material and your naturalism actually information concerning those risks is available in our earnings press release distributed prior to market open today and in our as you see filings we undertake no obligation to update these forward looking statements except
spk_1: as required by law
spk_2: further during the course of today's call we will refer to certain adjusted financial measures these non gaap financial measures should be considered in addition to as a substitute for or and isolation from gap measures additional information about these non gaap measures including reconciliation of non gap to comparable gap measures is included in our press release and investor presentation provided today
spk_1: our press release investor presentation and as you see filings are available on our investor relations website at investors that pelletier dot com
spk_2: joining me on say call or sharm saying our chief operating officer dave glazer chief financial officer and kevin kelly saki global had a business development over the course of the call will refer to various growth rates when discussing our business these rates reflect year over year comparisons unless otherwise stated i'll turn the call of to sharm to get us started thank you rodney it was a fantastic quarter across the board and que three total revenue grew thirty six percent commercial revenue growth has accelerated every quarter over the last year from four percent in queue for twenty twenty two nineteen percent and que one to twenty percent and que to now thirty seven percent in two three at this scale acceleration like this it's gravity defying us commercial revenue growth accelerated once again to one hundred and three percent year over year we added thirty four net new customers and que three to put this in perspective our commercial customer account grew by forty six percent sequentially we have more than doubled our commercial customer accounts as the beginning of the year we close
spk_3: fifty four deals of a million dollars or more thirty three of which were five million or more in eighteen of which are ten million or more adjusted free cash flow was one hundred and nineteen million a margin of thirty percent total deal that you grew fifty percent to three point six billion commercial deal value more than doubled to two point two billion remaining performance obligations increase by hundred and seventy two percent and year today we have grown revenue forty four percent to over one point one billion we have generated just free cash flow margin of twenty nine percent and thirty two percent adjusted operating margin there are so many wins this quarter instead of going through them customer by customers i usually do i wanted to highlight
spk_4: three themes
spk_3: one we are seeing more traction selling into the defense industrial base as a customer boundary has shown that it can help in the production of the a three twenty of ram pickup trucks auto parts pp and tractors you can do it better faster and cheaper and the defense industrial base is seeing that it can have the same impact on the production of fighter jets naval ship
spk_5: inland vehicles
spk_3: we're excited to do more here with l three harris hunting angles and other large primes secondly our work in automotive in more generally mobility is growing we were adding more customers across the mobility value chain from oh he ends and their suppliers all the way they even charging companies and insurers and lastly our work in healthcare is exploding the nh s and the anderson seventy academic medical centers through the in ages and three see the department of veterans affairs and even more regional us providers means that foundries helping to manage over three hundred million patient lives and growing
spk_2: we have a very unique opportunity and a diverse footprint that we believe continues to uniquely positioned us deliver on the necessary transformation in healthcare delivery from operational excellent the complex clinical care
spk_3: cutting edge products and continued innovation and distribution for of these exceptional results and que three in you couldn't really see that in the consistently accelerating commercial business we are seeing a profound poll on foundry in the market as organisations digest and synthesize lessons from the shocks of cool the in subsequent events there is a canonical spa
spk_2: a foundry the enterprise architecture that the market is synthesized foundries the nervous system and the cardiovascular system of the enterprise it is the connective tissue they can actually your analytics to your operational systems such an architecture marries a digital twin of the enterprise with actually p i said allow you to first model and simulate and second orchestrate and execute
spk_3: complex cross functional transactions as the coded nineteen crisis pulled the tide out that's exactly what was revealed is missing companies needed to move beyond visibility beyond the analytical insights to having the technical infrastructure to translate that into coordinated orchestrated actions in the operations of their business in one of the coup coolest places to see this working is with our days you're a companies these companies have enormous ambition in deeply value the step change in speed in the reduction of expenses foundry delivers when consumed as infrastructure is the service we do it was able to develop market ready applications and as little as six weeks on foundry sarkozys integrating half a trillion data points per month to accelerate design maintenance and commercialization of their iron man suits william is flying through ground and flight testing wielding the vast data generated by every censor streaming from the aircraft i'd like to introduce some of our days you're of founders to unpack this a little bit more
spk_6: these companies have a strong engineering culture and they've been able to very quickly take on the platform and make it a core part of their tech infrastructure
spk_7: and third generation manufacturer grew up in detroit from my earliest days was inspired by the importance of manufacturer is industry a festering is believe the impact of five manufacturing will be as profound on the physical world as cloud computing has been in the digital world wieters igniting leading the mobility revolution or locking device i've connected vehicle data an autonomous vehicle day
spk_8: so how also foundry super charges are distribution to thousands and thousands new supplies new solutions and into string theory of locks
spk_9: the news potential for you we found ourselves first we we try to twist or business to fit inside someone elses perspective of how businesses work method
spk_10: were they they've been using foundry as their data operating system so and to and from cloud hosting to the rack and of integration from different sources to using a lot of the out in the box and actress that we have the platform as from their harmonizing the data using open source languages take python sequel
spk_6: using spike as a distributed can compute engine
spk_7: we're collecting data on every part that will make today they about the design day about how that part is made in our factories data about how when that is moved over to our customers
spk_8: speed is all superpower speeds me means real time processing of have a seventeen billion data points day fact we've processed in real time if twelve trillion dice points our businesses crevice to put on high quality data in the understanding of their data on the port of people would say have to see it as and and they've have been just starting a number of opera
spk_6: for applications mostly for their internal operations to help like supercharged sad but also for even get an external third party users as part of their kind of tank now offering
spk_8: foundry enables us to build solutions fast and i'm lucky unique intelligence for industry for we joe a polish accounts it was the obvious choice if you're using founder you
spk_9: bitter think about what your position in the company as because everybody will be using
spk_3: a big thanks to our builders who shared more about their ambition and the transformative impact of foundry on their operations we started this program to supercharge earlier stage companies enabling them to create a central operating system for their data and to scale rapidly from days era these companies they're not just managing their data and their operations they are wielding them to blitz scale and when we announced our second cohort of builders in october there are seven companies from a diverse set of industries and we continue to partner with innovative companies across industries such as automotive biotech healthcare media in more turning more broadly do the commercial business the scope of our impact is expanding foundry as infrastructure is a big theme we're excited about customers are building their software on top of our platform and now we have yet another way to power that with a major product innovation that extends the openness and flexibility of our infrastructure for developers that were calling operational apia guys are opie eyes for short this liberates the ontology to serve as a nervous system the cardiovascular system the enterprise as a unified action and orchestration layer this a p i tools that allows for third parties in customer developers to programatic medically interact with foundries ontology in this headless mode id can leverage the power of the until allergy in all of their enterprise applications via this open architecture what's uniquely powerful about the ontology it's not the nouns it's not the things in the business it's the representation of the verbs the actions that can be taken to those things in the business the fact that inventory can be allocated production can be scheduled orders can be fulfilled the accomplish these deceptively simple actions requires you to read and write to potentially tens of source systems transactional a boundary let you orchestrate complex cross system decisions to win in turn market disruption into to your competitive gory for example a large industry partner is unlocking value by integrating microsoft power apps with the foundry ontology power apps through our opie eyes can affect business decision powering work flips and writing data back to external operational in transactional systems like your p m e s warehouse management systems and more this is the modern operating system in action
spk_2: we launched apollo this past week has a commercial offering nibbling any software company to leverage are deployment infrastructure to take their sas were no sas has gone before on prep classified clouds air gap networks and to the edge here tell us more is greg the army the mad scientist behind the conception and launch of apollo
spk_11: follows that orchestration engine for the enterprise revealing continues deployment configuration management and central software operations across use mini cloud and on from environments hello employees a number of different concurrent processes including version management advanced role strategies release promotion to ensure platform stay up to date and operational twenty four seven with apollo you can release new capabilities forty them and scale composed them into novel platforms the risk releases and rapidly resolve problems as they arise having deployment health and continuity on a single pane of glass gives engineers common interface to handle risk management concerns unique teach mark different environments have different risk tolerance is when it comes to software updates for instance your once roy a new features to canary environments first before moving those same updates declassified networks that are critical edge hardware that are harder to operate them follow facilities software stability across these different environments are using a concept called police champs environments can subscribe to release channel and accordance with their individual risk tolerance appetite for new features once push for your release channel apollo enables the evaluation and roll out through a powerful sweet of tools to help operators understand the risks associated with each pipeline surface problems and ship code better politics the possible take the same approach to continuous delivery across different security classification boundaries by enabling you to deploy and apollo hub with in each network down each network hub is responsible for managing the environments on that network this compliance aware change management people's hollow to centrally managed services and environments across different compliance regimes powering seamless operations across highly regulated business barnes polo effectively removes the deployment environment as a constraint enabling engineers to focus on velocity and application code that are a ones that works for all customer parts
spk_3: and we continue to push the envelope of apollo capability by enabling streaming processing at the edge once again we are building five years ahead of the market software sharm and building technology that will meet it's moment with our latest investments you will be able to develop streaming pipelines in foundry that you then package up verge in and continuously deploy to edge compute infrastructure be the one hum be a satellite of by g e bay station to enable real time processing of large amounts of data in a decentralized efficient manner these pipelines they'll be version to upgrade manage an orchestrated by apollo imagine you'll be able to blue green upgrade your streaming pipeline across submarines factory floor lawyers five and sixteen networks this is a revolutionary capability that will give our customers the edge against their competition
spk_2: there are two modular offering that we have taken a market that we were really quite excited about carbon emissions management and ml for crypto and finn tax starting with carbon emissions management there was a huge need to not simply account for carbon and more broadly emissions but what are you going to do about it day to day month a month how do you manage tradeoffs between
spk_3: production on time and for revenue march and in emissions targets how do you understand the levers you have to pull in the implications of each leopard do you have the ability to understand the consequences of changing a supplier or setting a different delivery routes or changing a production location on your emissions can you put that information into a single pane of glass the same pay a that your company uses to manage production or revenue or margin because until you do emissions management will only be a source of beta for you something that you do so that you're not left behind but once you do you'll be able to use it to be your competition and when in the market these work clothes or tailor made for foundry and leverage our digital twin in supply chain capabilities to present a single pane of glass to view revenue margin production and all emissions can not just see but to manage the outcome this is an area that we are seeing growing momentum in no small part because of the obvious charisma of alpha of developing a competitive edge customers across disparate industries are building carbon focused common and operating pictures to track live emissions to simulate emissions impacts of the changes to for example suppliers to technologies and right you'll asians and to make a real time changes to their business the other offering we're really excited about his foundry for crypto we have found a unique fit with fast growing crypto companies that need industrialize compliance solutions we are leveraging our deep anti money laundering and know your customer expertise developed over years helping governments find compliance issues with the world's largest banks in helping those banks respond and hardened their compliance programs i mentioned last quarter how one of europe's largest retail banks has deployed are ml solution in today's today's the cost speed and performances unmatchable these crypto exchanges in fact disruptors are actually technical and can eat easily discern what legacy banks struggled to that legacy compliance solutions are often two or more decades behind we believe there are no alternatives that can compete on costs speed and performance and we're really excited to put more weight behind this in the market turning to government we continue to advance our mission of becoming the us government's central operating system as we extend our footprint across defense healthcare and civilian agencies in the third quarter we say new deals with the department of health and human services the airforce the nih and more i'm proud to say that the met a constellation which we featured in last quarter earnings call net it's moment when called upon by uk and modi to enable noncombatant evacuation operations in afghanistan as a reminder emetic constellation is radically changing how satellites are tasked the latency of collection and it's creating a fundamental link in the ai enabled kill chain we are orchestrating a medic constellation of more than three hundred satellites by working with an array of commercial space companies these companies have been deploying constellations of hyper spectral radar and elan sensors into orbit and we're putting all that
spk_2: power directly into the hands of the frontlines empowering the edge and to end gotham and foundry infrastructure including met a consolation provided unparalleled capability and was stood up and less than a day for uk and modi operations in addition met a consolation was also used to great effect that last month scarlett dragon us military exercises were provided timely and effective targeting information this is all made possible because of apollo for edgy i
spk_3: we were recently down selected by the us army to be the sole provider of the army's intelligence data fabric and analytics foundation for the capability drop to program the army will deploy gotham to support intelligence workflows worldwide with a globally federated intelligence data fabric and analytics platform spanning multiple security classifications our work on cd to is just one of many initiatives of which we are engaging with the army including city one and titan that will accelerate the decision chain and provide decisive it vantage for armed forces in the near purified we have a motivating set of customers in growing pipeline for big pursuits and twenty two and beyond
spk_2: and it is growing every quarter or not just competing for programs our unique capabilities are creating their own opportunities our work in healthcare continues to expand and we recently signed a four year eighty seven million dollar contract with the department of veterans affairs this department serves nine million veterans and their family members and spends
spk_3: nearly a quarter trillion dollars per year
spk_2: after supporting them in the eggs didn't see during kuwait nineteen response we want an unrestricted competition to help our their data transformation efforts are software is going to enable to be a to integrate data across it's large i t landscape and ultimately to deliver better care and services for veterans it is a privilege to serve our veterans and warfighter earth both on the battlefield and in their period after service our collaboration with the nih continues in the fight against kobe nineteen as and three see deepens it's partnership with counter leveraging foundry as the research backbone this two year award carries a total potential value of sixty million dollars and the entry see data enclave represents one of the largest collections of code nineteen health records in the world additionally our work with and cats expanded with an increase in total potential value of twenty four million dollars zooming out a bit from my to space big picture and the government segment we are seeing an emerging opportunity to help define the next wave of disruption one thing perhaps the one thing we have demonstrated to the market is that it is possible to sell software at school
spk_3: hail to the government for programs of record where the government might have historically otherwise bought labor and services and of course in doing so we have radically transform the margin profile of these big government contracts there is an immense opportunity in this sector to partner with existing government contractors to product guys their solutions that they are delivering services today in it doing so to transform the iba that they generate against their existing revenue with our platforms we have proven we can do this with our business and we are exploring opportunities to partner with firms that have a disruptive vision and realize that they can stand on our shoulders the fifteen years and nearly three billion dollars of already that we have done to product ties in scale their own offerings before turning over today i wanted to give a quick shout out to every hobbit and just reflect on our journey as much over the last two decades as over the last year a year ago we gave our first results as a public company we should be proud of those five quarters a result but even prouder of the collective effort and passion that be got those results we pivoted the whole company to respond to the asian events of coded for governments a commercial entities around the world but of course that happened before we went public and we all had their question will we preserve the cultural essence of powder after the listing will we have the radical ability to organize and reorganize around the problem at hand while capturing the integral of our innovation
spk_2: well and que three we could answer that question definitively yes when the bat signal was put up in the night sky the motley crew of hobbits answered the call for america and her allies five quarters down at least five hundred more to go over to you dave
spk_11: being shown all review or third quarter performance followed by your outlook we had a record breaking que three as continued product innovation and are ongoing investments in distribution but to accelerating customer account growth and strong free cash flow
spk_2: we generate revenue growth of thirty six percent in the quarter bring que three revenue to three hundred ninety two million a year to date revenue to more than one point one billion of forty four percent person the first nine months of last year or business continues to demonstrate very strong cash generation third quarter cash from operations
spk_11: was one hundred and one million and improvement of one hundred and fifty three million versus the prior year period
spk_2: we delivered one hundred and nineteen million in it just for free cash flow in the third quarter representing a margin of thirty percent the strength of or third quarter performance brings your to date adjusted free cash flow to three hundred and twenty million representing a free cash flow margin of twenty nine percent and six hundred and five million dollar improvement from the prior year period third quarter adjusted operating income increased to one hundred and sixteen million representing a margin of thirty percent or fourth consecutive quarter with adjusted operating margin of thirty percent or greater we added thirty four net new customers in the third quarter and our total customer accounts for twenty percent quarter over quarter or commercial customer can't increase forty six percent quarter over quarter and it is more than doubled since the end of twenty twenty our new customers are scaling faster and more efficiently than ever before usually revenue from new customers acquired in year is up sixty six percent to thirty eight million and these customers are already generating contribution margin of thirty six percent this compares with just twenty three million in revenue and a negative twenty six percent contribution margin for new customers are really comparable period in two thousand and twenty drilling down into our third
spk_7: quarter revenue total revenue grew thirty six percent year over year ahead of or prior guidance of thirty three percent or us business continues to demonstrate strong growth with revenue increasing forty five percent new every year and que three
spk_2: looking at our que three revenue year over year by segment we continue to see broad based momentum in our commercial business total commercial revenue was one hundred and seventy four million or thirty seven percent and representing our third string quarter of accelerating commercial revenue growth our investments in product and distribution continue to drive growth particularly in the us were commercial revenue increased a hundred and three percent in que three and our international business continues to gain momentum as well with international commercial revenue growth accelerating for the third string quarter as economies continue to reopen and recover government revenue increased thirty four percent as we sign new deals with the air force hhs and in age and we were recently down selected by the us army to provide it's intelligence data fabric analytics solution under cd to in the third quarter we close fifty four deals of a million or more in total contract value including thirty three meals or five million or more and eighteen deals of ten million or more third quarter billings increase fifty six percent year over year and remaining performance obligation increase to one hundred and seventy two percent year over year as you continue to improve contracting push out or remove termination for comedians causes and move to shorter duration building cycles
spk_11: total remain jew value increase fifty percent new every year to three point six billion with commercial remaining deal that you increasing one hundred and one percent third quarter trilling twelve month revenue per customer with seven million down sequentially and reflecting continued acceleration in customer acquisition as we get it thirty four net new customers in the quarter
spk_2: we continue to expect rapid expansion in our customer base moving forward as you invest in our sales teams and channel partners and we'd expect average revenue per customer to continue to taper as a result of are growing customer ago when excluding and customers added in the quarter average revenue per customer was a point eight million of twenty six percent year over year and we continue to generate
spk_11: strong growth with our larger customers trailing twelve month revenue per top twenty customers which forty one point three million of thirty five percent year over year
spk_3: next i'll discuss our third quarter margins and expenses on an adjusted basis which excludes stock based compensation
spk_2: adjusted gross margin was eighty two percent up from eighty one percent in the year ago period contribution margin was fifty seven percent up from fifty six percent in the year ago period
spk_7: third quarter income for operations excluding stock based compensation and related employer payroll taxes was one hundred and sixteen million representing interested operating margin of thirty percent or fourth consecutive quarter with adjusted operating margin at or above thirty percent third quarter adjusted expenses were two hundred and seventy six million or two percent
spk_11: your rear and twenty percent while adjusting for one time to reckless seeing expenses incurred and que three twenty twenty
spk_2: the bulk of expense growth is driven by continued investments in product development in sales to support durable long term growth marketing expenses were up on hundred and forty four percent quarter over quarter as we continue to fuel demand generation in the third quarter we generated one hundred and nineteen million in adjusted free cash flow representing a margin of thirty percent through the first nine months of twenty twenty one adjusted because she was three hundred and twenty million representing an improvement of six hundred and five million versus a prior year period we entered the third quarter with over two point three billion in cash and know that turning to our outlook for a cure for revenue guidance respect revenue of four hundred and eighteen million in respect to just it operating margin of twenty two percent or queue for reading guidance and place for year twenty twenty one revenue of one point five to seven billion which represents another year revenue growth of forty percent or higher additionally for the four hundred twenty twenty one we are raising our annual just had free cash flow guidance to an excess of four hundred million an increase of one hundred million from our prior guidance continuing to execute the guy didn't strategy set forth by or ceo alex carp in our year and twenty twenty earnings call with regard to long term revenue guidance we are providing and will continue to provide guidance of thirty percent or greater revenue growth for this year and the next four years at each earnings call
spk_3: with that altering the colorado to roddy to open up tonight
spk_12: i think there will be given question from our shareholders and eight be effect found it hurts one for you actually and be and jacob p ask how interview any other ai company that competitors if so what make out your platform better choice
spk_13: our topic
spk_14: any other company really competition
spk_15: we are acting
spk_12: a department and their desire to build around and you know what it's not even really their fault army
spk_11: ah provider to peddle completely okay yeah white market they're never going to work a truck and nearly three nine argued development and we continue to innovate everyday
spk_12: jetpack week we had a meeting with fortune two hundred guy who would go the powdery here to whack three years trying unsuccessfully at all
spk_14: problem
spk_12: aggravating three years
spk_14: and they aren't the only one eat our favorite congregate having tried and failed because
spk_12: aqui how valuable it a buyer working day at scale not really what better choice work better choice could we focus groups on how we interact and capability and enable accompanied uniquely their strategy where it part enterprise or make are more similar to the application our product they are dying and morty morty friendship great job another one for you out a and yeah he asked are you planning to investigate any crypto currency yeah we are you worried about how we we he week which back growing industry like compliance either highly technical bikes and they're highly motivated disruptors we are leveraging our keep anti money laundering you know your expertise equity we've developed over here helping govern i'm compliant issue at all world large and helping go to and turn on and in a combined program how about the large and on reputation in the world or powered by powder vote on the department got your guy and everything and go we think we're going to be a mac protect our company we're going to get them credible and platform to enable them to go toe to toe and beyond the like where we're going to deliver compliance with they can focus on disruption and at court they are walking to and crypto great a sham date one for you have yeah
spk_11: do you tend to focus on profitability in the near term are you still focused on expansion a hobby though we're delivering stronger it with strong caution
spk_0: we collect revenue growth of forty percent for the full year
spk_11: if your second in a row of forty percent or higher growth the researchers to be costly thy to an excess of one hundred million dollars richer
spk_0: and three quarter written our guy
spk_11: and he applies in over six hundred seventy million dollar year over year pregnant
spk_0: stepping back we are continuing to deliver high group with very strong castle result and really focused on
spk_11: and so pivoting to feature we have more pilots today than at any time in our history we had a thirty four net new customers a few three we thank fifty four deals and three of a million or more were still your investments in aren't cheap hiring as in that finished product offerings for crypto the made constellation and the commercial direction
spk_12: apollo that one hundred fifty feels as if you're not to mention building infrastructure to support them and future years and we're continuing to build out and invest in marketing jewel it's early days later markets and is up a hundred and forty four percent quarter over quarter
spk_0: thanks dave sham another one for you daniel que asks gotham and foundry can be used and personal computers tablets and smartphones can count your platforms for you'd an augmented reality and virtual reality devices how impactful a are vr and the metaphors be for county here it's clients and big data analytics
spk_12: daniel we've been doing augmented and virtual reality for a long time more than a decade we have worked on pushing mission information to mark the in augmented reality beacon old up your phone and view mission planned route a tell the helicopter landing gun pointed interests way point overlaid while you're on mission we have worked out augmenting imagery and whole notion video with a i did you can contact real time to drive operational decision making at a recent military exercise or apollo for educate ability with you the caught the airlock your second unmanned aerial vehicle defend target the fighter jet those targets pop up in the pilots augmented reality heads up display we are at the edge we are integrating with edited by night vision goggles the heads up display from augmented reality and cockpit the emulation ai enabling to kill chain require pushing context to the decision making at the wifi a art the art an integral part of everything that we do create a in sharm kevin one for you does dennard jack and k and others have asked key talk about the opportunity for pelletier and small businesses and consumer use down the line thank you captain thank you jackson our as and be offering delivers the full power of foundry through apollo and to be adopted in game and we either with country for builders and other day zero companies not only our companies using foundry as their internal infrastructure are pioneering the youth of foundry and apollo as a platform to build that offerings and consumer software products as well with boundary they're doing companies and mobility building entire data ecosystem in foundry for connected vehicles and economists vehicles a renewable energy company using foundry not just for advanced physics model but also using foundry to create a software offering for their customers a be software company building in e r p for construction the founder told us that foundry is making it possible for him to build orders of magnitude bigger and with less effort and we've got a lot of questions about when pound you're going to have a consumer product available well
spk_11: something i can say is that day zero companies are building their consumer products on top of foundry take companies like chapter who helped in role customers in the right medicare plan
spk_12: by foundry and delivered through apollo we expect to see more of this and it's exciting part of archer
spk_11: mercil revenue up twenty one percent sequentially into three quarter of a quarter the numbers are especially strong in the united states where the us commercial business has accelerated from seventy two percent revenue growth grover into one that
spk_12: ninety percent growth rate and you to know a hundred and three percent revenue growth in two three that's more than doubling year over year and it's driven by continued product innovation and more efficiencies in distribution like
spk_0: the acquisition of new customers is accelerate we mention can that new customers and one twenty and two to thirty four and two three more than triple commercial revenue has accelerated every quarter over the last year from four percent and you for of last
spk_12: you're nineteen and que one twenty eight and you to and thirty seven into three total commercial deal value is up two point two billion that's more than doubling since last year or are kill remaining performed obligations to create a hundred and seventy two percent at eight hundred and seventy four million and a coke coverage and distribution channels bring us to great companies like apache a large hospital system in florida a large it health insurance provider in the united states kinda morgan a ladle dave and busters just to name a few great a cabin sean the patience for you more sell it asks what is it that will keep pelletier ahead of the competition for the next ten years marcel it well that that trillion our question courts joined arctic well short of our nature of next ten years we always have and will always continue to focus on building cutting edge product that the world meet anticipating that future operating with prescient we are stop for sean and building towards needed obvious always ready commute moment as was true with ideas and iraq and afghanistan the global financial crisis i think the cackling europe or more recently with coded supply disruptions in afghan noncombatant evacuation operation i've got them we are focused like canoeing to build the a naval kill chain across every cancer and every shooter covering older me from speak the much our plans are moderate operating systems for the enterprise
spk_14: with foundry we're creating the nervous and the cardiovascular and of the enterprise with opie i you can expose complex crockett them actions and repeatable matter that enables you to go from sensing visits or suction before they even happen
spk_12: changing your business to seamlessly response organizing and reorganizing your business around reality at peace and we just launched apollo commercial the athlete we have already used to college accomplished so much in the world from edgy i'm a real time comes with weapons than to running our global software delivery free taking gotham and foundry to were no thakur gone before and today i talked about apollo for streaming it feels like every quarter we're creating things
spk_11: we could not have defeat of art bell just a couple course before central to our value creation engine that we are focused on folding hard problem we're focused on creating fundamental value most software company makes offered that easy to fill in overtime that corrupt the value of the product we make thought for that has profound leave valuable cutting edge product and an innovator and distribution thanks sharm they one for you or james can reveal w ask the company's chief executive officer else car has been filling a large amount of share this year why didn't think so much and will be failed continue
spk_12: james or will be for the question as you mentioned on fire recalls part was great options decade ago which are set to expire on research
spk_11: typically as a reporter it was killed sixteen point nine million options that were set to fire detractors from the and of the options are more than a billion dollars it's a jones years along the way to generate revise
spk_0: of eight point nine million exploring options
spk_11: i'll exercise ninety four percent of the remaining six for probably half for and point million of them will be sold by get me
spk_12: the other half size and as a result old and year term exploring options look think they've shown for you antonio asks being a nurse myself i see great potential for counter in a pandemic times health care workers of the new defense the county have a plan to create a product that can help health care institutions on how to assign us thank you and tonio it can take you for all that you and your fellow have a culture where are the done for us over the pandemic my mother's a nurse and i've been living alongside so many not yet you but all over the world i made reference in my earlier remarked that and for growth of our healthcare work the nature and the anderson seven the academic medical center city and aged and treat the the be a somber nursing home thirty in japan and or more regional us providers boundary it's healthy to manage over three hundred million patient lives and growing we have a very unique and diverse footprint that i believe positions of to deliver on the net theory transformation and healthcare and yet we are absolutely doing the work at the cutting edge of both research and conflict clinical care but we are also doing the work and operational won the world over kobe and cause or severely exacerbated procedure backlog there are people that need right saving pier waiting to be thing and at the same time many fertility that spare capacity there's a complex operational problem and maximizing the utilization of scared healthcare your capacity to save lives but the challenge is multifaceted tapping operating theatre management patient management the management and more but as you highlight one of the most acute challenges and we're gauge on in the us and japan in the nursing shortage in staffing optimization i was recently visiting whatever hospital customers sitting with their nurses watching they are being trained on county for the first time you could feel the excitement they were buzzing and how they could transform patient schedule and care delivery and ultimately how it would empower them to do still much more so much faster
spk_0: need it was like what it felt like when i was watching marine being trained on powder the for the first time in kandahar a decade or more ago there were still excited so generally the iron man suit it with them like a glove as these modern day superhero save our friends in our family
spk_12: reach i'm one more for before he opened the call air and obvious what the future of counters public sector business including if there are any billion dollar contracts with the latest us army wins in the pipeline and you air and a naughty we are still excited about the government didn't it is where are cutting edge product meeting at the moment it was incredibly strong quarter the weaned on t to a truly map the program my record us needy in the okay calm the you page in australian navy i could be a with a four year eighty seven million dollar contract at the an age sixty million dollar to your contract feel that and they pepfar at the department of justice department of energy the state department and more cd to a date substantial when it build and another program record that we already won fifty one it was an enormous amount of work were so proud of the outcome and we believe that seating
spk_0: one pt two together uniquely positioned done for future you and army programs a record
spk_12: but that's just the aren't we have incredible opportunity to be forced into the airforce plated that we are investing a lot we are building on project brown hair and in the are fortunate workhorse towards workweek eat the domain awareness bottle of beer unique position we have many independent opportunities to ten the work that we have gone hundred under us the i in nj into the combat command and fell to directly take on your pure bred and deterred the enemy maintaining dominant beyond defend with the immense opportunity in our point across help from the and they check and the v a to the nih in a teacher with the new opportunities within the defense industry will be in it's own right and customers help them with their own manufacturing but also and being a strategic partner helping them capture new revenue stream by ai enabling their hardware platform the pipeline and aggregated be and building and all that is happening despite the macro headwind that we've all heard about across government services covert impact on delaying the paperwork and we are competing for known opportunities our capability to sell unique we're creating our own opportunities
spk_14: the macro back to hear a big big deal with work clear content is under threat from an aggressive atp not only in terms of impact on demand in the us but also japan korea austria the uk the west in her allied broadly the infrastructure bill and are fit on the program in a word there are that are being driven their carbon
spk_12: emissions management edi charging infrastructure building on are incredible commercial momentum in the a bit mobility value chain delivery of nature project on time and on budget and more broadly the opportunity for advice and primed on infrastructure project to partner with challenger develop their own high margin software stream and plate that historically low margin non recurring services on our platform
spk_16: we are just at the beginning of dig that trendier trend that we anticipated in have invested in for year we are uniquely positioned cutting edge product ready to meet a moment
spk_11: the sham operator movement the culprit unit
spk_12: you have to constantly of the phone you'll need a pet store wanting to join your question has the pound key your first question will come from brand do with jeffries please proceed a good morning and on our a and a really nice improvement on a backlog and conservative you could just commenting on what's riley not that dog and in any his fault her for some just as you look at why the go to market on commercial to be get it's not good and drug sales a build out and partnership opportunities there thanks a friend
spk_11: actually question
spk_12: great you three revenue great year with our you fork i'd worked to forty percent brand revenue girl from a full year and this is to region by continued product innovation also more efficiencies in distribution like a county fails distribution channels and we're very excited about the progress of our county the with hired about one hundred fifty people so far this year a lot about it and folks in the us market where we first started and many are just getting started but you can see some of the activity your we mentioned you with more than doubled our commercial customer count this year those numbers are accelerating to growing or installation day is really great because we expand in places where we are if you look at our top twenty customers average over forty million a year revenue that up thirty five percent year over year
spk_0: our average revenue per customer was a point eight nine when excluding new customers so lot of room to expand
spk_12: as we stand our customers
spk_16: another big driver
spk_17: us commercial revenue where we've seen acceleration your we mentioned up to one hundred three percent growth wu three
spk_12: or ford indicators also really strong total deal about you up fifty percent to three point six billion total deal died in commercial doubled the two point two billion or third street quarter of salaried in commercial revenue and you're just wrap up to commercial revenue of twenty one percent decline usually quarter of were your next question will come from line of keith whiteman morgan stanley please proceed
spk_16: oh thank you for taking the question
spk_18: was on those a really nice performance across commercial and governmental strong as well and server or the new administration sort of taking place in terms of the velocity of the deal and getting those deals on any change is deemed as far as in new administration vs on the player on them no meaningful change their and he that the government including it paid i think what's really out there it's a nuclear threat and and that become the real better for not only the us but allied allied countries as well because there's a lot of focus a lot of speed we've worked under fort ministry
spk_12: and have kentucky and continuity across them your next question will come the line of receipt a warrior some rbc capital markets please proceed to the question
spk_11: my wonderful that they for take my questions and a nice as he continues during the commercial side or just get new be available can you help us understand how the how the land and expand into the market motion all the where sighed all have different from from government in new experience in and especially on so far this year and maybe he talks a little bit about
spk_12: how involved you or at the pilot apologies and beyond a new that guy looks like thanks great yeah we talked earlier about module those a year ago that really change how we went to market the module that pindaric the old order we got the the carbon emissions management module and found for crypto but we go back a little bit what we can be a real think that the software defined get integration the at the the i'd and in your case with module where we've been able to really use these modules to me our customers were they are predictable price point it also enable got to to really scale panel and enable our partners help go to market
spk_16: a predictable price point clear problems to go after and in doing so we at this point has developed enough to see that after solving single problem and and understandable way it really up to better expansion and land the full propagation of foundry country and expand the contract over overtime there so we really have a lot of faith in them off module strategy both as a direct they'll force augmentation and channel partners and commercial on on the government die we have been the most dick that we actually want a significant program
spk_19: it on on a module that it based on reading can so we were able to compete for multi million dollar program less than a gay work and effort of course we love our on economic er visit they think the speech alley where customers is really what sets it apart
spk_12: your next question will come from the line of products now that i'm you think please it hello oh brad zelnick your line is open pleased with your question only will move onto the next question and que your next question is the mark for morningstar pleased to keep it a question good morning thanks for the question
spk_16: a multipart one so you know we talked about the recently launched found your module around crypto and i was wondering to a know that was really a press release rather the monsters kind of margins kind of appeared so you know finding news use case great but i was curious you could talk about the size of the crypt an opportunity but it also that strategy of releasing modules
spk_12: finally customers and commercializing a quietly are really does depend on the market size me interest thank you
spk_18: mark
spk_12: but the focus on module it's a really neat because or where they are where do we feel repeatable challenges that we can create a
spk_11: and offering that is very back to deploy a lot or i talked about how we deployed ml at the largest european retail gang and luck and today that the kids are going to get inducted into the performing you know we were are able to integrate with complicated
spk_12: york evolution and unlock that the for customers and our so we were we start with cutting edge product and then where we see the module lead to get the innovated distribution it enabled on those from the draft bill for perspective but also general partners i'd be really careful a penetrating market and we do have one final question time for one final question what i'm even brought some wolf research please proceed with your question hey guys are developed with within broom remove research i just heard many to quit numbers questions rocking if we think about you for guidance how much revenue do expect the come from commercial contracts to the bathroom arrangements are in the quarter and then it is possible to get what percentage of the total arpaio would be recognized the next four months so on the on the get into the program really thought about the opportunity here on to
spk_16: repeat remember think you're from contracts for their que for guys are tacking forty and revenue growth three year it went on one it's over one billion for the year we raise our cash flow got through an actor a four hundred million
Disclaimer