Joe Vandrick

Joe Vandrick from Scotiabank observed a decline in the Control Suite's percentage of total ARR from 28% to 26% year-over-year, asking why its net new ARR might have been weaker than expected despite AI tailwinds, and why Modernization and Resilience performed stronger.

Answer

Jim Caci, Chief Financial Officer, attributed the shift to increased customer focus on data migration in Q4 and the second half of 2025, impacting the Control Suite's percentage of total ARR. TJ Jiang, Chief Executive Officer, added that while Control Suite deal sizes are typically lower, it's a high-margin product crucial for AI governance and platform robustness. Both executives emphasized that the percentages are part of a bundled platform approach and not indicative of long-term challenges, noting the Control Suite still grew at roughly 20% year-over-year.

Joe Vandrick from Scotiabank inquired about the decline in the Control Suite's percentage of total ARR from Q4 last year to Q4 2025, asking why its net new ARR might be weaker than expected given AI tailwinds, and why Modernization and Resilience performed stronger.

Answer

CFO Jim Cassie attributed the shift to increased data movement and migration projects in the second half of 2025, which boosted Modernization. CEO TJ Jiang added that while Control has robust demand for AI governance and is a high-margin product, its average deal size is lower than other modules. Both emphasized that the percentages vary quarter-to-quarter and that the platform's combined offerings drive value, with Control Suite still growing at roughly 20% year-over-year.

Joe Vandrick from Scotiabank asked about the primary theme driving customer conversations—whether it's AI readiness, CoPilot governance, or cyber resilience—and questioned the discrepancy between the unchanged constant currency ARR guide and the increased revenue guide.

Answer

CEO Tianyi Jiang identified security threats and AI deployment as the consistent top themes in customer discussions, noting that data governance is central to enterprise strategy. CFO Jim Caci clarified that the constant currency ARR guidance was operationally raised but appeared unchanged due to FX headwinds and rounding. He added that while services contributed to the Q2 beat, SaaS performance was also very strong.

Joe Vandrick inquired about Qualys's strategy to drive customer adoption of prioritization and patch management beyond basic vulnerability management, and the percentage of the customer base using only basic VM functionality. He also asked for clarification on the Q-Flex beta testing and whether Qualys plans a customer-wide rollout or will continue with select partners.

Answer

Sumedh Thakar, President and CEO of Qualys, explained that Qualys focuses on providing customers with capabilities like average exposure window and business impact quantification (dollar value loss) to prioritize effectively. He highlighted the increasing adoption of integrated patching and mitigation solutions, citing 140 million patches in the last year, as customers seek to reduce risk quickly. He also mentioned expanding ETM with TotalCloud, ISPM, Policy Audit, and TotalAI. Joo Mi Kim, CFO of Qualys, stated that Q-Flex is currently in beta and rolled out on a case-by-case basis to create win-win scenarios, with plans for a broader GA rollout with a potentially tweaked structure in the longer term.

Joe Vandrick asked about Qualys's strategy to encourage customers to adopt prioritization and patch management beyond basic vulnerability management, and inquired about the percentage of the customer base currently using only basic VM functionality. He also asked if Q-Flex, currently in beta, is planned for a customer-wide rollout or will remain for select partners.

Answer

Sumedh Thakar (President and CEO, Qualys) explained that Qualys drives adoption by providing customers with business context, such as dollar value loss quantification, which reorients prioritization. He highlighted the impact of integrated patching and mitigation solutions, citing 140 million patches deployed in the last year and the innovation of "patchless patching." Joo Mi Kim (CFO, Qualys) stated that Q-Flex is currently in beta and rolled out on a case-by-case basis to ensure a win-win scenario, with plans for a broader GA rollout in the longer term, potentially with a tweaked structure.

Joe Vandrick from Scotiabank asked about the frequency of multi-product platform deals versus single-module sales and inquired about the drivers behind the improvement in gross and net retention rates.

Answer

CEO Sumedh Thakar explained that customers often pursue a hybrid approach, and Qualys's ETM module is key to providing a unified risk view by ingesting both Qualys and third-party data. CFO Joo Mi Kim attributed the improved retention to a combination of a stabilizing macro environment and better execution in communicating the value of new products to renewing customers.

Joe Vandrick inquired about the surge in inbound interest for managing agents, asking which solution (Auth0 or workforce side) is gaining more traction and which represents the larger opportunity.

Answer

CEO Todd McKinnon indicated that both Auth0 for AI Agents (targeting developers with an online, self-service motion) and Okta for AI Agents (targeting IT and security with an enterprise architecture focus) are receiving similar levels of interest. He noted that it is still very early days for both, and the company is focused on iterating quickly to define the market and serve both personas effectively.

On behalf of Patrick Colville, Joe Vandrick from Scotiabank asked about the opportunity within Global 2000 (G2K) accounts, the percentage of million-dollar customers that are G2K, and how the sales team communicates value to these large enterprises.

Answer

CFO Mike Scarpelli stated that the average G2K customer could easily spend $10 million or more annually on Snowflake. He estimated that roughly 50% of their $1M+ customers are G2K companies. He added that the sales approach is heavily focused on enablement and articulating the business value of Snowflake, rather than just its cost.

Joe Vandrick of Scotiabank questioned if the low MDR adoption among MSPs was true for N-able's base and asked about the drivers behind the strong growth in customers with over $50k in ARR.

Answer

CEO John Pagliuca confirmed low MDR adoption is a significant opportunity and that N-able is educating MSPs on its differentiated, AI-powered XDR solution. He attributed the growth in large customers to a strategic focus on larger MSPs, successful cross-selling of products like AdLumen and Cove, and landing larger new deals, particularly within the MSP market in Q2.

Joe Vandrick, on behalf of Patrick Colville at Scotiabank, asked about Tenable's strategy for securing generative AI, the role of the Apex Security acquisition, and the company's right to win in this emerging market.

Answer

CFO and Co-CEO Steve Vintz outlined a multi-layered AI security strategy, with Apex adding a critical governance and enforcement layer to existing discovery (AI-aware) and posture management (AI-SPM) capabilities. Co-CEO Mark Thurmond added that the Apex acquisition was met with significant customer interest, serves as a key market differentiator, and will be integrated into the Tenable One platform.