Jamie Reynolds

Jamie Reynolds from Morgan Stanley inquired about the adoption trends for new modules like PagerDuty Advanced and Enterprise Plus. He also asked for additional color on the differing demand trends between the SMB and enterprise segments of the business.

Answer

CEO Jennifer Tejada explained it is 'still early days' for the new modules but noted strong customer interest at events. She highlighted a change to seed AI capabilities across all pricing plans to reduce adoption friction. Tejada also confirmed an improving demand signal from the SMB segment for two consecutive quarters, led by well-funded native AI companies, a trend that is also crossing over into the enterprise.

James Reynolds asked about potential adoption hurdles for newer AI functionalities beyond Draft One and the impact of recent FAA waiver process improvements on the Drone as a First Responder (DFR) business.

Answer

CEO Patrick Smith acknowledged that advanced features like vehicle intelligence might see slower adoption in some jurisdictions but noted strong interest in productivity tools like the real-time translator. Executive Jeffrey Kunins added that the broad AI suite offers a 'palette of choices,' increasing overall value. Regarding DFR, Smith and Kunins called the FAA changes a 'meaningful step forward' and stated that DFR is 'going mainstream,' with growth expected to accelerate in the second half of the year.

Jamie Reynolds of Morgan Stanley asked about the specific factors driving the improved traction and strong bookings performance in Axon's international markets.

Answer

EVP Joshua Isner attributed the international success to improved leadership under the new CRO, Cameron Brooks, which has led to better team quality and execution. He noted that while it's still a "grind" dealing with federal governments, customer momentum is building. CEO Patrick Smith added that new AI capabilities, like real-time translation, are generating significant global interest.

James Reynolds, on behalf of Meta Marshall, inquired about the key drivers behind the continued increase in average revenue per customer and asked about the durability of the strong Q1 gross margin performance throughout the rest of 2025.

Answer

CEO David Morken attributed the growth in average revenue per customer to broad adoption of the Maestro and AI Bridge platforms, which drives increased usage, cross-selling, and upselling. CFO Daryl Raiford stated that while quarterly margins can vary, the full-year guidance implies margins consistent with Q1's performance, keeping Bandwidth on track to meet its medium-term target of 60% or more in 2026.

Jamie Reynolds, on for Meta Marshall, asked for early demand signals and the monetization strategy for the new SVX product and Assist AI feature.

Answer

EVP and COO Jack Molloy described high customer interest, including from competitors' clients, giving an example of a police department upgrading to APX NEXT radios specifically for the SVX. EVP and CFO Jason Winkler explained monetization will be driven by increased APX NEXT adoption and software attachments. EVP and CTO Mahesh Saptharishi highlighted how SVX's superior audio quality and data integration significantly enhance AI-assisted reporting.