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President Matt Mills stated that they are seeing an acceleration in migrations from legacy systems, as the current threat landscape exposes the flaws of older, heavily customized solutions. CFO Brian Carolan reinforced this by citing a recent Gartner report showing SailPoint gaining market share at a rate of 5x its nearest competitor, validating its success in displacements.

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CFO Brian Carolan noted that Q4 had positive cash flow from operations despite significant interest payments. He confirmed all debt was paid off in Q1. After final one-time payments in Q1 related to the IPO and debt, he expects a 'very clean' cash flow profile from Q2 onward. Over the next one to two years, he anticipates the free cash flow margin will approach the adjusted operating margin.

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Co-CEO and CFO Stephen Vintz clarified that the full-year CCB outlook is consistent with prior directional comments, though it includes incremental caution on U.S. Federal. He noted the Vulcan acquisition will add about 0.5 point of CCB growth, primarily in the second half of the year. Otherwise, the typical seasonal flow is expected to remain the same.

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CEO Amit Yoran noted no impact on commercial or international clients from election uncertainty but acknowledged caution in the federal space is factored into guidance. CFO Steve Vintz clarified that 'sales,' as in '35% of total sales,' refers to internal bookings.

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CEO Corey Thomas stated that he does not believe the acquisition significantly changes the competitive dynamics, as the MDR market is large and highly fragmented. He emphasized that Rapid7's success will depend on its own execution, including delivering a high-quality service and more effectively communicating its story and capabilities to the market, noting the opportunity is massive for many providers.

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CEO Corey Thomas confirmed that some deals that had slipped from March did close in April, suggesting some stabilization. However, he characterized the environment as still being volatile with a wide range of potential outcomes. While not overly pessimistic and feeling that the 'worst of the worst' may be over, he stated it is not yet a stable macro environment, which is why the company widened its guidance range.

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CEO Corey Thomas clarified that the company had deliberately reduced pipeline generation for its risk management business while retooling the strategy. He stated that the 70% growth signifies that the risk business pipeline is now returning to levels seen in mid-2023. More importantly, it has helped the total company pipeline recover from a Q2 deceleration and is now steadily rising.

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President, CEO & Board Chair Dhrupad Trivedi stated that the product revenue growth reflects successful penetration of large enterprise customers and a partial return to normal spending patterns for some North American service providers. He noted this is a positive leading indicator for future growth. Trivedi also confirmed that Q2 linearity was normal, without a back-end loaded skew, and that July trends did not alter the company's outlook.

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Executive Dhrupad Trivedi explained that the net impact of tariff uncertainty is currently neutral, as some customers delay orders while others procure ahead. He noted broad caution, especially on large, long-term service provider projects. Regarding AI, Trivedi stated A10 has reasonably good visibility into the first wave of build-outs by major cloud and enterprise companies. He believes the larger, more durable opportunity will emerge in one to two years as enterprise customers build out on-premise inference models, particularly outside the U.S.

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CEO Dhrupad Trivedi stated that Q4 seasonality was consistent with prior years but with less of a 'budget flush' phenomenon due to increased spending scrutiny. He outlined that new security products are expected within a 6- to 12-month window, while AI-related data center solutions should positively impact results in the second half of 2025, leveraging A10's advantages in throughput and latency. CFO Brian Becker confirmed the seasonal pattern was in line with their typical 48% front-half, 52% back-half revenue split.

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CFO Brian Robbins confirmed that Q1 is a seasonally strong collections quarter following strong Q4 billings. He stated there was nothing anomalous or one-time in nature that contributed to the record free cash flow, attributing it to normal business operations and ongoing improvements in operating leverage.

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CFO Brian Robbins reported that the demand environment has been consistent, with no major changes from the previous quarter. He noted that while spending remains cautious, the pipeline provided enough confidence to raise the full-year guidance after the Q3 revenue beat.

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CEO Jay Chaudhry stated that customers generally dislike ELAs due to the risk of shelfware, and Zscaler avoids that model. Instead, Zscaler focuses on demonstrating a clear journey to improved security and cost savings by replacing legacy products. He emphasized that a key internal focus is ensuring high deployment and usage of their solutions, which aligns with delivering long-term customer value.

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CEO Jay Chaudhry identified the Zero Trust branch solution as the key to capitalizing on the refresh cycle. He explained that marketing is highly targeted through account-based teams, webinars, and executive summits. He highlighted that 57% of Zero Trust branch customers are new logos, indicating the strategy is already helping to expand their customer base, suggesting an immediate impact.

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CEO Todd McKinnon focused on the significant opportunity in the large enterprise segment, evidenced by 20% growth in customers with over $1M in ARR. He cited cloud migration, security, and AI as key catalysts. CFO Brett Tighe declined to comment on future exit rates, stating it was too early in the fiscal year to provide that level of detail.

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CEO Todd McKinnon stated that an upgrade to OIG can increase a customer's ACV by 30% to 40% or more, representing a significant upsell opportunity across the entire Workforce Identity customer base. CFO Brett Tighe added that the new specialized sales force is designed specifically to drive these types of advanced capability upsells, helping customers solve more use cases and demonstrating the value of the platform.

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CEO Todd McKinnon attributed the solid Q3 to stronger deal execution, suggesting the fiscal year is more back-end loaded than initially thought. He pointed to momentum from large deals and new products, which constituted 15% of bookings. CFO Brett Tighe added that healthy contract durations and a strong U.S. federal year-end also contributed positively to the results.

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Tomer Weingarten (CEO) responded, stating that the guidance represents a reasonable starting point for the year based on pipeline activity, new product contributions, and conversion rates. He noted that while the macro environment remains volatile, the company believes the guidance is appropriate.

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CEO Tomer Weingarten explained the outperformance was due to a combination of two main factors: strong leverage from emerging products like Purple AI, Cloud, and Data, and customer migrations resulting from the July 19th competitor outage. He affirmed that based on the current pipeline, this trend appears sustainable.

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CEO Tomer Weingarten stated that the company has not devised specific takeout programs, as they don't feel it's warranted. The focus is on educating the market about architectural differences through literature and collateral. He emphasized that their strategy is to be present for customers and partners, staying true to facts and avoiding aggressive or opportunistic marketing tactics, letting the technology's superiority speak for itself.

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CEO Victor Limongelli stated the company is in a 'tremendously better shape' due to cost structure improvements and growth opportunities in Security and Digital Agreements. He and CFO Jorge Martell explained the guidance difference is due to the ongoing, expected decline in hardware revenue, the revenue recognition mechanics of multiyear term licenses, the impact of end-of-life products on revenue, and a cautious stance on the euro-dollar exchange rate, which affects about 40% of revenue.

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CFO Dipak Golechha and CEO Nikesh Arora addressed the question. Dipak explained that the year-ago quarter included a one-time reclassification of advanced firewall subscriptions into the NGS ARR metric, creating a difficult comparison. Nikesh added that the QRadar contribution was a one-time inorganic benefit and no further inorganic ARR is expected in the fiscal year.

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CFO Keith Jensen noted the high penetration of SD-WAN in their large enterprise base (around 65-70%) and stated that future growth will come from winning new whitespace accounts. He anticipates a renewal cycle for early SD-WAN adopters in 2025-2026, creating an opportunity to displace incumbents. CEO Ken Xie added that Fortinet's internally developed solution has a technology and cost advantage over competitors who relied on acquisitions, positioning them well to win replacement deals as the fragmented market consolidates.

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CEO Olivier Pomel explained that while the product was initially built for a fully integrated experience within the Datadog platform, the customer response has been exceptionally strong. This has created high demand for integrations with external tools, which the company now plans to build. He emphasized the strategic goal is full incident automation, not just paging.

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