Tufin Software Technologies Ltd. Ordinary Shares

Greetings. Welcome to Tufin's fourth quarter 2021 earnings call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. If anyone today should require operator assistance during the call, please press star zero from your telephone keypad. Please note that this conference is being recorded. At this time, I'll turn the conference over to Jackie Marcus with Investor Relations. Jackie, you may now begin.

Thank you, Operator, and good day, everyone. Tufin released results for the fourth quarter of fiscal 2021, ended December 31st, 2021, earlier this morning. If you did not receive a copy of our earnings press release, you may obtain it from the investor relations section of our website at investors.tufin.com. With me on today's call are Ruvik Attaf, Tufin's co-founder and chief executive officer, and Jack Lekiele, Tufin's chief financial officer. This call is being webcasted and will be archived on the investor relations section of our website. Before we begin, I would like to remind everyone that any statements made in today's webcast that relate to a future event or express a belief, expectation, projection, forecast, anticipation, or intent regarding future events or the company's future performance may be considered forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other applicable securities laws. These forward-looking statements are based on information available to Tufin's management team as of today and involve risks and uncertainties, including those noted in this morning's press release and Tufin's filings with the SEC. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those projected in the forward-looking statements. Tufin specifically disclaims any intent or obligation to update these forward-looking statements except as required by law Please note that a reconciliation of any non-GAAP number to the mostly directly comparable GAAP number can be found in the tables of our earnings press release located in the investor relations section of our website. With that, I'd like to turn the call over to Tufan's CEO and co-founder, Ruvik Kittos. Ruvik?

Thank you, Jackie. Good morning, everyone, and thank you for joining us today. I'm excited to be here with you to review our fourth quarter results, reflect on the last year, and share our outlook for 2022. The end of 2021 marks the completion of year one in our transition to a subscription model, and I'm excited to say that we exceeded our transition targets for the year. Additionally, we surpassed our guidance in both the top and bottom line, and we entered a new year with solid momentum across the business. As I reflect on our fourth quarter in the full year of 2021, we made significant progress, strengthening our sales team, improving our lead generation efforts, signing new logos, and adding subscription-based services. we saw increased awareness of security breaches as corporations are allocating more resources to implement policy-driven automation in order to navigate the security threats of tomorrow. Turning to our fourth quarter performance, I'm pleased to report another strong quarter bolstered by healthy growth in new logos, as well as continued momentum in our land and expand with existing customers. We signed a record number of larger deals, including our most significant deal in the last three years. Our fourth quarter revenues grew 16% year over year, with 27% growth in product revenues. Full year revenues were a record $110.9 million, with subscriptions representing approximately 56% of the new license bookings for the year. In addition, 84% of the bookings from new logos in 2021, excluding hardware and professional services, were subscription. While Jack will discuss this in greater detail in a moment, I'm pleased to share our ARR, as we believe it provides the best reflection for the health of the transition. At the end of 2021, we reached $72 million in ARR, representing growth of 19% year over year. Going forward, we will provide ARR on a quarterly basis. As I mentioned earlier, we're ahead of our stated objectives, and we feel confident going forward about our continued move from perpetual licensing to subscription. Moving to the cloud, we're pleased to report that Tufin Cloud Bookings totaled $3.9 million in 2021, representing 40% year-over-year growth. Tufin Cloud Bookings refers to the combined sales of secure cloud with secure track and secure change cloud licenses. Moving forward, we plan to report Tufin Cloud Bookings on an annual basis. This has been an important year for Tufan as we completed our first chapter as a subscription-based business while also seeing growth in both new logos and expansion of existing accounts. Before I discuss our business in greater detail, I'd like to now turn the call over to Jack for a deeper discussion of our financials. Jack?