SolarWinds Corp (SWI) This autumn 2023 Earnings Name Transcript

SolarWinds Corp (NYSE:SWI) This autumn 2023 Earnings Convention Name February 8, 2024 8:30 AM ET

Firm Individuals

Tim Karaca – Vice President, Strategic Finance and Investor Relations

Sudhakar Ramakrishna – President and Chief Government Officer

Barton Kalsu – Government Vice President, Chief Monetary Officer and Treasurer

Convention Name Individuals

Robert Oliver – Baird

Matthew Hedberg – RBC Capital Markets

Jaiden Patel – JPMorgan

Erik Suppiger – JMP Securities

Operator

Good morning. My title is Jeannie and I will probably be your operator right now. All traces have been positioned on mute to stop any background noise. After the audio system’ remarks, there will probably be a question-and-answer session. [Operator Instructions] Thanks.

I might now like to show the decision over to Tim Karaca, Group Vice President of Finance. Mr. Karaca, it’s possible you’ll start your feedback.

Tim Karaca

Thanks. Good morning, everybody, and welcome to the SolarWinds Fourth Quarter 2023 Earnings Name. With me right now are Sudhakar Ramakrishna, our President and CEO; and Bart Kalsu, our CFO. Following our ready remarks, we may have a question-and-answer session. This name is being concurrently webcast on our Investor Relations web site at traders.solarwinds.com.

You may also discover our earnings press launch and the summer season slide deck, which is meant to complement our ready remarks throughout right now’s name. Please keep in mind that sure statements made throughout this name are forward-looking statements, together with these regarding our monetary outlook, our market alternatives, our expectations relating to buyer retention, our continued evolution to a subscription-first mentality and timing of the phases of such evolution.

Our expectations relating to our associate ecosystem, the SEC enforcement motion, the affect of the worldwide financial and geopolitical setting on our enterprise, and our gross stage of debt. These statements are based mostly on present out there info and assumptions, and we undertake no obligation to replace this info besides as required by regulation.

These statements are topic to numerous dangers and uncertainties, together with the quite a few dangers and uncertainties highlighted in right now’s earnings launch and our filings with the SEC.

Copies can be found from the SEC on our Investor Relations web site. We are going to talk about numerous non-GAAP monetary measures on right now’s name, except in any other case specified after we confer with monetary measures we will probably be referring to non-GAAP monetary measures.

A reconciliation of the variations between GAAP and non-GAAP monetary measures and definition of different monetary metrics mentioned on right now’s name can be found in our earnings press launch and abstract slide deck on the Investor Relations web page of our web site.

Lastly, we notice that the monetary outcomes mentioned on right now’s name and in our earnings launch are preliminary and pending remaining assessment by us and our exterior auditors and can solely be remaining as soon as we file our annual report on Type 10-Okay.

With that, I’ll now flip the decision over to Sudhakar.

Sudhakar Ramakrishna

Thanks, Tim, and good morning, everybody. I hope you are off to a fantastic begin in 2024. As at all times, I would prefer to thank our staff, prospects, companions and shareholders for his or her ongoing dedication to SolarWinds.

I am happy to report that we delivered one other robust quarter, as soon as once more exceeding our steering throughout all key metrics ending the 12 months on a excessive notice and including to the momentum we constructed all through 2023. We consider our efficiency continues to display not solely the resiliency of our enterprise mannequin, but in addition the compelling worth we ship to our prospects.

Now turning to enterprise highlights from this quarter. First, robust subscription income and general ARR development demonstrating the continued success of our subscription-first technique. Second, continued development and adoption of our observability resolution. Third, robust buyer retention, which was a crucial precedence of ours in 2023.

Fourth, vital enhancements we delivered on our SolarWinds platform, because it continues to be the inspiration that fuels innovation for our self-hosted and SaaS options so prospects can consolidate instruments and expertise hybrid visibility, simplicity and cost-effective productiveness throughout multi-cloud environments.

Lastly, continued adjusted EBIT development and one other quarter of reaching the Rule of fifty. I’ll now talk about a few of our fourth quarter monetary highlights earlier than turning the decision over to Bart, who will present extra element on the quarter, our monetary efficiency in 2023 and our monetary outlook for 2024.

In This autumn 2023, we noticed whole income of $198 million above the excessive finish of the vary we supplied and representing a year-over-year development price of 6%. With the continuing success of our subscription-first technique, within the fourth quarter, we delivered subscription income development of 36% and subscription ARR development of 34%.

We delivered fourth quarter adjusted EBITDA of $87 million, above the excessive finish of the vary we supplied and representing development of 17% year-over-year. Our fourth quarter in-quarter upkeep renewal price was 95% and our trailing 12-month upkeep renewal price on the year-end was 96%, a rise from 95% as of the tip of the third quarter and 93% as of the year-end 2022. And we delivered fourth quarter whole ARR development of 8% year-over-year with continued execution of our subscription-first and platform technique.

Shifting to our product portfolio. We consider that SolarWinds offers essentially the most complete AI-powered full stack observability options within the business throughout networks, infrastructure, functions and databases.

Our multifaceted product portfolio presents observability, database efficiency and repair administration options throughout on-premises, cloud and hybrid setting, enabling prospects to speed up their enterprise transformation in an more and more multi-cloud world.

We assist scale back prospects’ complexity and value by eliminating software sprawl assist quickly detect and remediate points, improve time to worth and enhance productiveness. We consider that SolarWinds hybrid cloud observability contributes to elevated retention and conversion charges and that our prospects are having fun with elevated worth, as we proceed to evolve and lengthen the capabilities of our options.

Throughout observability, service administration and database efficiency administration, our groups are persevering with to ship buyer crucial capabilities. We consider our broad spectrum of self-hosted to SaaS options most successfully permits our prospects to speed up their enterprise transformation with deployment flexibility.

Some current enhancements embody, in November, we introduced SolarWinds database observability, a brand new providing that delivers complete visibility into databases to extend the efficiency, scalability and effectivity of digital companies and functions.

Mixed with our software observability capabilities, we will scale back prospects’ time to detect issues of their multi-cloud setting. At AWS re:Invent 2023, we unveiled the most recent enhancements to our SaaS delivered observability resolution, serving to prospects speed up their cloud journeys and together with help for OpenTelemetry and new Kubernetes software intelligence in addition to the addition of cloud-enabled open supply and NoSQL database observability capabilities.

We proceed to boost our self-hosted observability options with new machine help to supply elevated protection for our prospects. We additionally proceed to evolve our community infrastructure and cloud observability options and had a number of prospects leverage the facility of our options to achieve hybrid visibility.

I am happy to share that simply this week, we introduced that collection of transformative AI-powered enhancements throughout our SaaS-based observability options, most notably to our confirmed community infrastructure and cloud choices.

Constructing upon our networking heritage, we now supply full visibility throughout on-premises and cloud networks together with on-premises and cloud community gadgets, digital machines, hypervisors, containers and infrastructure as a service assets.

We invite you all to study extra about our newest improvements at our subsequent SolarWinds Day on Wednesday, February twenty eighth. Layered by all sides of our choices is secured by design, our customary for safe software program growth and infrastructure safety. We developed the safe by design initiative to deal with the ever-changing risk panorama and for instance how safety is part of our group’s cloth.

We consider our initiative not solely delivers enhanced safety for our prospects, but in addition advances cyber security for SolarWinds and for our business at massive and establishes a brand new customary for safe software program growth.

Turning now to our associate ecosystem. As you have heard me talk about in current quarters, our companions, together with international system Integrators and hyperscalers are more and more essential for our increasing go-to-market motions and might help us develop our attain to prospects in a scalable, environment friendly and cost-effective method.

The SolarWinds mannequin of inside and velocity gross sales is the inspiration upon which we’re constructing these further go-to-market motions. In August 2023, we introduced enhancements to our channel associate program designed to speed up development and income with and for our companions, these updates present higher flexibility for our companions to realize their targets, new alternatives for channel providing enhancements and specialised choices for database and ITSM product.

We are going to proceed to spice up our rework associate summit with a number of thrilling occasions deliberate for 2024, together with our EMEA Summit in Lisbon, our APJ Summit in Bali and our Americas Summit in Miami. I stay up for assembly our companions and sharing our 2024 plans. I consider that companions which are drive multiplier and collectively, we might help our prospects additional speed up their enterprise transformation.

2023 was a robust 12 months throughout a number of dimensions, and I am going to present a fast recap. First, we efficiently drove subscription adoption throughout our companies, which is seen in our robust subscription income and ARR development outcomes. We consider that is per how our prospects need to eat our merchandise and that a rise in our subscription base offers an much more strong basis for our income and margin growth efforts.

Second, we demonstrated rigorous expense self-discipline in a difficult macro setting by investing selectively, whereas managing prices and enhancing our working margins as mirrored in our 17% adjusted EBITDA year-over-year development in 2023.

Third, we proceed to prioritize buyer success and retention and efficiently improved our upkeep renewal price to 96% on a trailing 12-month foundation. And fourth, we delivered on our innovation agenda by extending and enhancing the AI-powered capabilities of our options whereas additionally increasing our ecosystem to deliver even higher worth to our prospects.

It’s my perception that we constructed a robust basis and profitable technique that is a direct results of our give attention to our transformational efforts throughout all facets of our enterprise during the last three years.

With that, I’ll flip it over to Bart to develop on our monetary efficiency and supply a full 12 months 2024 outlook. Bart?

Barton Kalsu

Thanks, Sudhakar, and because of everybody for becoming a member of us. 2023 was a profitable 12 months for us as we began to see returns on lots of the investments that we’ve got revamped the previous few years.

We’ve grown in whole income and vital acceleration in our subscription income and subscription ARR. Margins have been one other space of focus for us, and we improved our adjusted EBITDA by $48 million or 17% year-over-year. And our adjusted EBITDA margin is again to the mid-40s.

The fourth quarter was per the primary three, as we beat steering throughout all key metrics. We’re happy with the monetary outcomes we delivered in 2023. We’ve elevated the combo of predictable recurring income, delivered double-digit adjusted EBITDA development and made substantial progress in enhancing our leverage profile.

Turning to the numbers. We completed the fourth quarter with whole income of $198 million, a 6% improve in comparison with the prior 12 months and above the excessive finish of $192.5 million of outlook for whole income that we supplied final quarter. On a full 12 months foundation, whole income completed at $759 million, above the excessive finish of outlook of $753 million and nicely above the excessive finish of the vary of $725 million to $740 million that we supplied initially of the 12 months.

We ended the fourth quarter with whole ARR of $684 million, up 8% year-over-year. Our subscription ARR on the finish of the fourth quarter was $233 million, a rise of 34% year-over-year. This development continues to be pushed by the execution of our subscription-first technique. We’ve traditionally supplied the variety of prospects, who’ve spent greater than $100,000 with us over the previous 12 months. That quantity was 945 as of December thirty first, which was a 6% improve over the prior 12 months.

Shifting ahead, as an alternative of that metric and per our subscription transition, we are going to now be offering the variety of prospects who’ve annual recurring income, or ARR, of higher than $100,000. We consider that whole ARR from prospects is a greater indicator of the well being of the enterprise, since annual recurring income offers perception into the standard and repeatability of the enterprise.

We had 979 prospects with over $100,000 of whole ARR, representing a 15% development over the prior 12 months. Digging into the income particulars, our fourth quarter subscription income was $68 million, up 36% year-over-year with full 12 months subscription income of $234 million, a rise of 40% year-over-year. The rise in subscription income displays the success of our subscription-first technique. Upkeep income was $115 million within the fourth quarter, roughly flat in comparison with the prior 12 months.

Full 12 months upkeep income was $462 million, up 1% year-over-year. As we’ve got beforehand mentioned, the conversion of a portion of our upkeep prospects to subscriptions has impacted upkeep income, and we anticipate that it’ll proceed to take action as we proceed our subscription-first transition.

Our upkeep renewal price is 96% on a trailing 12-month foundation and was 95% for the fourth quarter. The advance in our renewal price in 2023 was a testomony to the loyalty of our buyer base and the worth of our options.

As we convert upkeep prospects to subscription, we exclude these prospects from this renewal price calculation. On account of the subscription income development and powerful upkeep renewal charges, we now have 92% of our whole income as recurring income.

For the fourth quarter, license income was $15 million, down 31% from $22 million within the fourth quarter of 2022. And full 12 months license income was $62 million, down 33% year-over-year. As a reminder, our subscription-first focus has affected and can proceed to have an effect on our license gross sales efficiency.

Our give attention to working self-discipline delivered one other quarter of robust non-GAAP profitability. Fourth quarter adjusted EBITDA was $87 million, rising 17% year-over-year, representing an adjusted EBITDA margin of 44% and coming in $4.5 million above the excessive finish of the $80.5 million to $82.5 million outlook we gave for the quarter.

Full 12 months adjusted EBITDA was $328.6 million, rising 17% from the prior 12 months, representing an adjusted EBITDA margin of 43% and coming in $4.6 million above the $322 million to $324 million steering we gave final quarter.

As we have mentioned in prior quarters, we’re centered on our capital allocation, disciplined expense administration and driving operational efficiencies throughout our enterprise whereas specializing in development in our broader subscription transition. Given the unsure macro outlook for 2023, we took measures to optimize our expense construction as a part of our ongoing give attention to enhancing working margins within the first half of the 12 months.

Throughout 2023, these measures resulted in $20 million of restructuring fees, primarily related to $14 million of lease impairments for sure workplace areas and prices associated to headcount reductions. Trying forward, we are going to proceed to watch the setting carefully and we plan to rent selectively and handle our value in a disciplined method.

Turning to our steadiness sheet. We considerably improved our leverage place in 2023. Our internet leverage ratio at December thirty first was roughly 2.9 occasions, our trailing 12 months adjusted EBITDA. This compares to three.9 occasions on the finish of final 12 months.

As well as, in January of 2024, we refinanced our time period mortgage, lowering the rate of interest by 50 foundation factors from SOFR plus 375 to SOFR plus 325, making the most of the most recent rate of interest setting. We proceed to generate robust money stream with $183 million in money stream from operations in 2023.

Our money and money equivalents and short-term funding steadiness was $289 million at year-end, bringing our internet debt to below $1 billion. Our money place and constructive money stream give us the power to fund future development in addition to flexibility on capital allocation options transferring ahead. I’ll now stroll you thru our outlook earlier than turning it over to Sudhakar for remaining ideas.

I’ll begin with our first quarter steering after which talk about our outlook for the total 12 months. For the primary quarter, we anticipate whole income to be within the vary of $187 million to $192 million, representing 2% development on the midpoint.

Adjusted EBITDA for the primary quarter is predicted to be roughly $81.5 million to $84.5 million, representing 7% development on the midpoint. Non-GAAP absolutely diluted earnings per share are projected to be $0.20 to $0.22 per share, assuming an estimated 171.3 million absolutely diluted shares excellent.

And at last, our outlook for the primary quarter assumes a non-GAAP tax price of 26%, and we anticipate to pay roughly $12 million in money taxes in the course of the first quarter. For the total 12 months, we anticipate whole income to be within the vary of $771 million to $786 million, representing 3% development year-over-year on the midpoint. Adjusted EBITDA for the 12 months is predicted to be roughly $350 million to $360 million, representing 8% year-over-year development on the midpoint.

Non-GAAP absolutely diluted earnings per share are projected to be $0.95 to $1 per share, assuming an estimated 173.2 million absolutely diluted shares excellent. Our full 12 months and first quarter steering assumes a euro to greenback trade price of 1.08 to 1.

With that, I am going to return the decision to Sudhakar for his closing remarks.

Sudhakar Ramakrishna

Thanks, Bart. As you possibly can see, the outlook Bart shared represents a continuation of prime line development and adjusted EBITDA development. This approaching the heels of our robust 2023 efficiency displays our perception within the growing relevance of our broad array of product choices, mixed with our capacity to execute and innovate.

Buyer environments proceed to grow to be extra complicated, as they tackle the challenges and alternatives of their respective companies. Equally, their budgets stay constrained, particularly on this macro setting.

Clients wish to consolidate to and to enhance safety whereas decreasing alert fatigue, all whereas searching for options which are easier to obtain and use cloud prepared to assist them rework on the tempo of their enterprise, value efficient whereas enhancing productiveness. We consider we’re ideally suited to ship these options to our prospects. We take our obligation to ship buyer success very significantly, whereas being excited and disciplined concerning the alternative forward.

Seeking to 2024, we are going to proceed to increase our SolarWinds platform and ship efficient options, construct to assist prospects, handle their hybrid and multi-cloud environments, make investments selectively whereas persevering with to train expense self-discipline and search to develop profitability, give attention to subscription and ARR development, buyer success and retention, rising profitability and money stream and creating extra worth for our shareholders.

Though many unknowns across the macro setting persist we stay centered on the issues we will management. I am happy with all of the work our groups have completed to assist us cap 2023 with a robust fourth quarter, and I am as assured as ever within the path of our enterprise. I couldn’t be prouder of our crew’s dedication to prospects’ success.

Once more, I thank our staff, companions, prospects and shareholders for his or her dedication to SolarWinds.

Bart and I are actually comfortable to deal with your questions.

Query-and-Reply Session

Operator

[Operator Instructions] Your first query comes from the road of Rob Oliver with Baird. Your line is open.

Robert Oliver

Hello. Good morning, guys. Thanks very a lot for taking my query I had two. And the primary — and this may very well be for Sudhakar or for you, Bart. I simply needed to ask for a bit extra colour across the 2024 prime line information. There is a pretty vital divergence between the This autumn exit price development of 5.9% and what you guys have guided for the total 12 months. And given a few of the success you guys are seeing within the transfer to subscription and the platform sale, simply need to higher contextualize that steering for ’24? After which I had a fast follow-up.

Sudhakar Ramakrishna

Thanks, Rob. Initially, I hope you’re doing great. Let me put some context across the 2024 information, and I am going to ask Bart so as to add any feedback he has at that time. First, as you famous, and as you noticed from our outcomes, we’ve got been executing nicely to our plan and our priorities as evidenced within the 2023 outcomes. We aren’t anticipating vital adjustments to the macro setting in 2024. However on the similar time, we’re assured in our resolution set, the boldness that the purchasers have in us and our capacity to execute. So we balanced a bunch of issues, together with if there are any macro unexpected circumstances and appropriately created our steering, with the purpose that we proceed to carry out and carry out nicely associated to it going ahead.

Barton Kalsu

Sure. And Rob, I might simply reiterate, there’s nonetheless a bit of little bit of uncertainty on the market within the setting and macro. And so we simply need to — after we set steering, we’re simply taking that into consideration. We’ve not seen any noticeable adjustments in shopping for patterns, as we go into ’24. We’re simply attempting to be prudent.

Robert Oliver

Bought it. Okay. Nice. That is useful. After which my follow-up was across the associate program, Sudhakar, undoubtedly one of many adjustments that you have made right here in placing your fingerprints on the corporate. And it actually sounds such as you guys are making progress. I do know it has been a variety of effort to sort of construct this associate community, construct belief with the companions in a enterprise that wasn’t historically associate centered. May you assist us — you talked about a variety of the occasions you may have this 12 months. Are you able to simply assist us perceive different with numbers or with sort of parameters, what would represent success? Like how ought to we take into consideration the contributions to the enterprise from companions later this 12 months? What would you prefer to see? Thanks.

Sudhakar Ramakrishna

Completely, Rob. Whereas we’ve got made nice strides with our associate program, I’ll say that we’re nonetheless within the early innings of our transformation in direction of leveraging companions globally. And once I discuss companions, I discuss, name it, conventional resellers and distributors, international system integrators, cloud service suppliers and MSPs in addition to the hyperscalers. So we’ve got motions in all of those dimensions, however at numerous ranges of maturity. We take a reasonably holistic method to companions the place we actually consider that there are extensions to us. We have already seen outcomes from companions producing demand, figuring out new alternatives and shutting them. So I am very optimistic that we will work very carefully collectively and actually construct a drive multiplier, whereas on the similar time, doing it affordably. That is a basis of how we function at SolarWinds and that can proceed. So the place you are going to see a few of the results of it as we transfer ahead is, particularly with the GSIs. We’re having access to bigger accounts and profitable a variety of these massive enterprise accounts as nicely. This isn’t to say that we’ve got a broad gross sales drive within the area, which is dear and speculative. It is vitally focused on a solution-by-solution foundation working with the GSIs, and that provides us vital leverage from a value of gross sales standpoint. After which from there, it trickles on all the way down to conventional resellers, MSPs that proceed to drive MSPs and CSPs that proceed to drive our subscription options and so forth. In order that’s the place I see the leverage. We’re probably not breaking down any financials there, however hopefully, you may proceed to see that in our general financials, Rob.

Robert Oliver

Nice. Useful. Thanks very a lot.

Operator

Your subsequent query comes from the road of Matt Hedberg with RBC Capital Markets. Your line is open.

Matthew Hedberg

Nice, guys. Thanks for taking my query. I suppose a follow-up on sort of the steering, but in addition the 4Q outcomes. You had a extremely robust beat this quarter, actually good efficiency. You are sort of saying the macro setting stays unsure. However I suppose at a excessive stage, did issues get higher for you in 4Q versus 3Q? Or was perhaps just a bit bit extra funds flush that you just deliberate on as a result of the expansion was significantly robust this quarter.

Sudhakar Ramakrishna

Matt, I might say it was easy — merely a continued give attention to our execution. So we didn’t see any, I might say, anomalies both to the constructive or the detrimental, because it pertains to This autumn. This autumn, as you understand, is a seasonally larger quarter for many enterprise software program firms. We aren’t any exception. So we did get pleasure from that impact. However outdoors of that, there was nothing, name it, unnatural.

Matthew Hedberg

Bought it. Okay. After which on the upkeep conversion, I feel traditionally, you have mentioned that you just’re changing these prospects on a better — at a better greenback worth. I am questioning if in case you have any metrics that you can share on a few of the conversion efforts.

Sudhakar Ramakrishna

So the conversion metrics have stayed strong all by 2023, however I additionally need to present some context as to why that’s the case. As I’ve mentioned in earlier calls, it isn’t merely a matter of changing a upkeep greenback to a subscription greenback. As a lot as after we are doing it, we’re doing it from usually a single level product or a small variety of level merchandise to our observability suite. That offers prospects higher entry to our full performance permits them to do software consolidation. So a few of it’s plain conversion. And in most offers, there may be vital growth as nicely. So after we discuss conversion components, it is a blended price of these two issues.

Matthew Hedberg

Bought it. Thanks, Sudhakar.

Sudhakar Ramakrishna

Thanks.

Operator

[Operator Instructions] Your subsequent query comes from the road of Pinjalim Bora with JPMorgan. Your line is open.

Jaiden Patel

Hey, guys. Jaiden Patel on for Pinjalim. One fast query on our finish. What’s assumed within the information in relation to the authorized proceedings? Are you assuming any disruption there? And what are you assuming for upkeep conversion going into ’24. Thanks.

Sudhakar Ramakrishna

Thanks, Pinjalim. On the authorized proceedings, I can say that, due to the main focus of our groups, we actually haven’t had any distractions associated to that from an operational standpoint. We’ve a really competent crew that’s managing that. And all of us and together with me, are in a position to give attention to our prospects and our staff and on rising our enterprise. Our prospects have vital belief in us. We do not take that evenly, and we proceed to earn their belief each single day. And I am positive you have seen that in our buyer retention charges, development charges, even after a few of the newer bulletins across the authorized proceedings have come by. It’s my perception that as we proceed to work with the authorities, the info will come out and we really feel very assured in our info.

Jaiden Patel

Bought it. Thanks for taking the questions.

Operator

Your subsequent query comes from the road of Erik Suppiger with JMP Securities. Your line is open.

Erik Suppiger

Yeah, thanks for taking the query. So certainly one of your opponents out this morning is that they speak extra about how there is a rising demand for software consolidation or there’s an acceleration in that demand. And when the client is making a software consolidation choice, it is prolonged the gross sales cycle as a result of it is a extra complicated choice. There’s extra log out and issues of that nature. I am curious if in case you have seen something alongside these traces.

Sudhakar Ramakrishna

Erik, to begin with, it’s true that prospects wish to consolidate instruments. In truth, our hybrid cloud observability options, one of many categorical worth proposition of that, is to assist prospects simplify and consolidate. The one distinguishing issue, I might say, relative to a few of the different opponents is we’re in a position to get the consolidation and the deployment in an very simple trend. Time to worth is certainly one of our key drivers, and that has at all times been the case for SolarWinds. So that allows us to proceed to drive velocity. That is primary. Quantity two is that we’ve got very low buyer focus with a really massive mid-market buyer base. And due to this fact, we’re in a position to keep the speed of our enterprise at the same time as we compete and win bigger offers, which are inclined to have naturally longer gross sales cycles as nicely. So we aren’t concentrated like a few of the prospects in like, as an instance, solely the enterprise phase and never should take care of the implications of elongated gross sales cycles. However do I see it in deal to deal, Sure. However is it impacting our enterprise? No.

Erik Suppiger

Superb. Thanks.

Operator

There aren’t any additional questions right now. I’ll now flip the decision again over to Sudhakar Ramakrishna for closing remarks.

Sudhakar Ramakrishna

Thanks, once more, and thanks all on your help of SolarWinds. We are going to proceed to work in direction of our strategic priorities, execute and stay up for sharing our outcomes on an ongoing foundation.

Operator

This concludes right now’s name. You might now disconnect.