Welcome to the Box, Inc. First Quarter Fiscal 2022 Earnings Conference Call. At this time, all participants are in listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker today, Christopher Foley, VP of Finance and Investor Relations. Thank you. Please go ahead. Good afternoon, and welcome to Box's First Quarter Fiscal Year 2022 Earnings Conference Call. On the call today, we have Aaron Levie, our CEO, and Dylan Smith, our CFO. Following our prepared remarks, we will take questions. Today's call is being webcast and will also be available for replay on our investor relations website at www.box.com/investors. Our webcast will be audio only. However, supplemental slides are now available for download from our website. We will also post the highlights of today's call on Twitter at the handle @boxincIR. On this call, we'll be making forward-looking statements, including our Q2 and FY 2022 financial guidance and our expectations regarding our financial performance for fiscal 2022 and future periods, timing of and market adoption of our products, our markets and the size of our market opportunity, and our expectations regarding our free cash flow, gross margins, operating margins, operating leverage, future profitability, unrecognized revenue, remaining performance obligations, and billings, our planned investments and growth strategies, our ability to achieve our long-term revenue and other operating model targets, the timing of and benefits from our new products, pricing, and partnerships, the impact of our acquisitions on future Box product offerings, the impact of the COVID-19 pandemic on our business and operating results, the impact of the KKR-led investment in Box, and any potential repurchase of our common stock. These statements reflect our best judgment based on factors currently known to us, and actual events or results may differ materially. Please refer to the press release and the risk factors in documents we will file with the Securities and Exchange Commission, including our most recent annual report on Form 10-K, for information on risks and uncertainties that may cause actual results to differ materially from statements made on this earnings call. These forward-looking statements are being made as of today, May 27th, 2021, and we disclaim any obligation to update or revise them should they change or cease to be up to date. In addition, during today's call, we will discuss non-GAAP financial measures. These non-GAAP financial measures should be considered in addition to, not as a substitute for or in isolation from, our GAAP results. You can find additional disclosures regarding these non-GAAP measures, including reconciliations with comparable GAAP results, in our earnings press release and in the related PowerPoint presentation, which can be found on the investor relations page of our website. Unless otherwise indicated, all references to financial measures are on a non-GAAP basis. With that, let me hand it over to Aaron. Thanks, Chris, and thanks everyone for joining the call today. I'm incredibly proud of our team at Box and our strong start to FY 2022, delivering a 200 basis point improvement in our revenue growth rate versus the previous quarter, 24% billings growth, and 20% growth in RPO year-over-year. With the strong momentum we're driving, we are confident in our ability to achieve accelerated growth and higher operating margin now and in the years ahead. As a result, we are raising our revenue guidance for the full year. Dylan will go over the financial results and guidance in more detail, but before I hand it over to him, I'd like to talk about our strategy, the value that our Content Cloud brings to our customers, and the positive impact we are seeing in the market as a result of our strong execution. Our strategy is well aligned to three major trends that are driving the future of work. First, work is being defined by hybrid work environments. In a recent Gartner study, more than 80% of company leaders surveyed said they plan to allow employees to continue working remotely at least some of the time. Even as offices open back up, traditional physical boundaries will continue to blur, and enterprises will need to empower collaboration both internally amongst virtual and distributed teams, and externally with partners, customers, and suppliers to get work done from anywhere. Second, we know that the future of business will be cloud and digital first. Customer and partner interaction will increasingly be executed digitally, from the onboarding of employees to automating workflows with partners. These workflows must function using multiple cloud-based applications. Access to content in a single, unified platform across a multi-cloud environment is critical to ensure productivity and business success. Finally, data security, compliance, and privacy remain more important than ever. Governments across the world are enacting new data privacy requirements, and as recent cyber attacks, such as the SolarWinds and Colonial Pipeline events have shown, cybersecurity threats are affecting all enterprises and creating significant business disruption. Content integrity is an absolute requirement. Content is the lifeblood of a company, and any breach that threatens the security of content can cause irreversible damage to the enterprise. At the heart of these challenges is how companies work with their most valuable content. Great content is how the best movies get made, how the best sales pitches are done, how marketing campaigns drive customer engagement, and how the next new product breakthrough is ideated and ultimately delivered to market. Today, enterprises spend tens of billions of dollars every year just to store and manage content in fragmented legacy systems like network storage and document management systems. There is simply no way enterprises can get the value of the content that they have with these approaches. That's where Box comes in. Our platform offers more critical functionality designed for the multi-cloud, hybrid work environment, and a seamless, secure user experience than any other solution in the market today. We are building the leading Content Cloud for enterprises. Our strategy is to power, automate, and integrate the complete content life cycle from the moment content is created through the entire content workflow in a single platform that enables our customers to thrive in a work-from-anywhere, digital-first, highly insecure world. Our Content Cloud moves beyond legacy content management systems by automating workflows between cloud-based applications through integrations with the apps our customers are using to get their work done, like Salesforce and Microsoft Teams. We're building deep functionality in the key areas of the content life cycle, such as our advanced workflow solution with Box Relay and e-signatures with Box Sign. We have natively built advanced security into the platform so that our customers' content stays safe and compliant. Now, we are making it easier than ever for our customers to move content into Box with Box Shuttle. Combined with our cloud-first approach, Box is the only platform that enables customers to work in and across cloud-based applications without fragmented content architectures. Box provides a seamless, simple, and intuitive experience that drives productivity for users every time, wherever they are. Our vision for the Content Cloud is resonating with customers. More and more, our customers are recognizing the strategic importance of consistent content availability and integrity, whether they are collaborating on a project in Zoom, closing a quarter using Salesforce, or building a new product with Autodesk. This is illustrated in Q1 by the 48% year-over-year growth in enterprise deals over $100,000. Additionally, our multi-product suite sales are gaining strength, with our customers adopting and leveraging more of our Content Cloud functionality. As proof of this, we have experienced a record 49% attach rate of our suites this quarter in $100,000-plus deals, and we anticipate the growth of our multi-product plan continuing in the future. In Q1, we continued to build on our leadership position in Content Cloud and transform how enterprises work. First, we expanded our product portfolio with the acquisition of SignRequest, a leading cloud-based electronic signature company, to develop Box Sign. Box Sign is expected to be available this summer. It will be natively embedded into Box and included in all Box business subscription plans, with additional levels of functionality being available in our enterprise plans and suites. This will enable all of our customers to have access to the value of Box Sign, while also enabling us to monetize the higher-end e-signature use cases that leverage advanced functionality and APIs. Another exciting announcement we made in Q1 was the availability of the all-new Box Shuttle. For many organizations, moving to the cloud has been a priority, but the cost and complexity of content migration has been a major impediment to cloud adoption. The new Box Shuttle can migrate some of the most complex and large-scale content management environments at a lower cost and faster than ever. We also announced significant updates to our security products this spring. Box Shield, which helps customers reduce risk and proactively identify potential insider threats or compromised accounts, remains the fastest-growing product in Box's history. We continue to rapidly innovate on Box Shield's advanced machine learning technology to help protect our customers' most important IP. Finally, we announced updated partnerships with both Microsoft and Cisco. We continue to enhance our integrations with Microsoft Teams, Office, and Microsoft's Information Protection suite. As customers adopt a multi-cloud strategy, they need to access and work with content across a range of applications, and Box helps bridge content management between Microsoft and other platforms. Similarly, we've updated our partnership with Cisco Webex to make it even easier for users to create workflows that span our two platforms. Turning to our customers, we have seen some outstanding examples of how organizations are utilizing Box to run their businesses and drive productivity, such as a global leader in the financial sector who embedded Box deeper into its business with a seven-figure expansion in Q1. For this leading enterprise, Box manages its business-critical content and powers encrypted document sharing between clients and financial advisors at scale, while adhering to the highest standards of data privacy, protection, and security. A government agency who selected Box in Q1 to power secure collaboration for their hybrid work environment, as well as drive critical processes for the delivery and sharing of public health research. Over 100,000 customers rely on Box to power secure collaboration and critical business processes across their organizations in Q1, and we closed wins and expansions with leading organizations such as D.A. Davidson Companies, IQVIA, Isuzu Motors, and Penguin Random House. Our strategy is working as demonstrated by our strong results, including the improvement in our revenue growth this quarter, in addition to the very strong billings and RPO growth. We are committed to our FY 2024 targets of delivering a growth rate of 12%-16% and operating margin in the range of 23%-27%. We are going after one of the largest markets in software, attacking a total addressable market of over $55 billion in spend on content management, collaboration, storage, and data security annually. With the addition of e-signature capabilities, our market is only getting larger. We're also confident that we have the right team and board of directors to take full advantage of this opportunity and drive significant shareholder value going forward. With the addition of John Park, who brings significant software growth investing experience and the expertise and resources of KKR, we have eight independent directors who are former or current operators of high growth and highly profitable SaaS and enterprise software companies, including three former or current public software CEOs and two former public CFOs. Throughout this year, we will continue to build out our industry-leading Content Cloud. We will expand data migration and workflow automation, go deeper with our data security and compliance offerings, enable new ways to collaborate and publish content on Box, and enhance insights and analytics so customers can get the most out of their content. With over 100,000 customers on our platform, an exciting roadmap, and a strategy that is already yielding results, we are building on our leadership in cloud content management and driving the next phase of growth. With that, I'll hand it over to Dylan. Thanks, Aaron. Good afternoon, everyone, and thank you for joining us. In Q1, we are pleased to have exceeded our guidance across all key metrics. Our acceleration in revenue growth, billings growth, RPO growth, and operating profit clearly demonstrates the strong trajectory of our business. As a result, we are raising our full year revenue guidance. We delivered revenue of $202 million, up 10% year-over-year, a 200 basis point improvement from the 8% growth we delivered in the previous quarter. Our Content Cloud offerings are increasingly resonating with our customers, as demonstrated by the strong add-on product traction and large deal growth we achieved in Q1. As Aaron mentioned, we're excited by the early customer response and demand for native e-signature capabilities in Box, and we're on track to make Box Sign generally available this summer. As our customers are increasingly adopting products with more advanced capabilities, 60% of our revenue is now attributable to customers who have purchased at least one additional product, up from 54% a year ago. In Q1, we closed 59 deals worth more than $100,000, up 48% year-over-year. Importantly, 49% of these six-figure deals included one of our multi-product suite offerings, a new record for us, and up significantly from 28% a year ago. We ended Q1 with remaining performance obligations, or RPO, of $865 million, up 20% year-over-year, exceeding our revenue growth by 1,000 basis points and an acceleration from the prior quarter's RPO growth rate. Q1's RPO growth is comprised of 15% deferred revenue growth and 23% backlog growth, demonstrating Box's stickiness as we continue to sign longer term agreements to support our customers' content strategies. We expect to recognize more than 60% of our RPO over the next 12 months. Q1 billings of $159 million were up 24% year-over-year and a significant improvement from Q4's growth rate. This result reflects the impact of a few early renewals from customers who had been set to renew in Q2, shifting roughly $5 million in billings from Q2 to Q1. Our net retention rate at the end of Q1 was 103%, up from 102% in Q4. This result was driven by strength in customer expansion and a stable annualized churn rate of 5%. Based on the strong momentum we're seeing in customer expansion and retention, we expect to deliver additional improvements in our net retention rate over the course of this year. Turning to margins. Our non-GAAP gross margin came in at 73.0%, in line with the same period a year ago. Q1 gross profit of $148 million was up 10% year-over-year, consistent with our revenue growth. We expect gross margin to increase over the course of this year and for it to come in at roughly 74% for the full year as we continue to deliver infrastructure efficiencies. Our ongoing efforts to improve profitability are paying off. In Q1, we delivered significant bottom-line improvements through our continued focus on profitable growth and disciplined expense management. Additionally, our investment in building out our engineering center of excellence in Poland will help us drive additional operating leverage and efficiencies over time. Q1 operating income doubled year-over-year to $34 million, which in turn drove a 760 basis point improvement in Q1 operating margin to 17.0%. As a result, in Q1, we delivered $0.18 of non-GAAP EPS above the high end of our guidance and a strong 80% improvement from $0.10 a year ago. I'll now turn to our cash flow and balance sheet. In Q1, we delivered record cash flow from operations of $95 million, up 53% from the year ago period. We also generated record free cash flow of $76 million, a year-over-year improvement of 91%. Capital lease payments, which we include in our free cash flow calculation, were $13 million versus $17 million in Q1 of last year. As a reminder, we expect our capital lease liabilities and payments to continue decreasing steadily in the coming years as we continue to drive infrastructure efficiencies and leverage our public cloud partnerships. For the full year of FY 2022, we continue to expect CapEx and capital lease payments combined to be roughly 7% of revenue. Cash from investing in Q1 reflects $57 million in M&A related payments, primarily driven by the acquisition of SignRequest. As a result, we ended the quarter with $612 million in cash equivalents, and short-term investments. Before I turn to guidance, I'd like to discuss the accounting impact resulting from the preferred stock issuance that we closed earlier this month, combined with our anticipated repurchase of common stock via a self-tender offer, which we expect to launch next week. Due to the required accounting treatment for these transactions, based on our current expectations, this will result in the following EPS impacts. First, on a quarterly basis, until conversion of the preferred stock into common stock, a roughly $0.025 reduction due to the non-cash accounting impact related to the preferred stock dividend, which we anticipate settling in shares of common stock. Second, for Q2 and FY 2022, a $0.02 reduction due to a temporarily elevated share count during the period between our recent preferred stock issuance and the completion of our anticipated share repurchase. Combined, these items will result in a $0.04 reduction to EPS in Q2 and a $0.09 reduction to EPS for the full year. This preferred stock dividend will appear below the net income line in our P&L and in the earnings per share note accompanying Box's financial statements. Note that this will have no impact on net income. With that, I would like to turn to our guidance for Q2 and fiscal FY 2022. Based on our strong Q1 results and forecast, we are raising our full year revenue guidance. Our underlying profitability expectations for FY 2022 are also now higher than our initial expectations. For the second quarter of fiscal 2022, we anticipate revenue of $211 million-$212 million, representing 10% year-over-year growth. We expect non-GAAP operating margin to be in the range of 18%-18.5%, representing 150 basis point sequential improvement at the high end of this range. Including the $0.04 impact I just discussed, we expect our non-GAAP EPS to be in the range of $0.17-$0.18, and GAAP EPS to be in the range of negative $0.13 to negative $0.12 on approximately 167 million and 160 million shares, respectively. We expect our billings growth rate to be in the mid-single digit range, which includes the $5 million impact from early renewals that I mentioned earlier. Combined with our strong Q1 billings results, this would result in year-over-year billings growth of roughly 13% for the first half of FY22, ahead of revenue growth and an acceleration from our billings growth in the first half of last year. For the full year ending January 31st, 2022, we are raising our full year revenue guidance, and we now expect our FY22 revenue to be in the range of $845 million-$853 million, representing approximately 11% year-over-year growth at the high end of this range. We expect non-GAAP operating margin to be in the range of 18%-18.5% above our initial FY22 expectations. The high end of this range represents a 320 basis point improvement from last year's results of 15.3%. Our stronger business performance drives a $0.04 improvement in our EPS expectations for FY22 versus our initial guidance. At the same time, our full year EPS guidance incorporates the $0.09 reduction for the preferred stock accounting charges that I mentioned previously. As a result of these various factors, we now expect our FY 2022 non-GAAP EPS to be in the range of $0.71-$0.76 on approximately 161 million diluted shares. Our GAAP EPS is expected to be in the range of negative $0.50 to negative $0.45 on approximately 154 million shares. We continue to expect billings growth to be slightly above revenue growth for the full year of FY 2022. For the back half of FY 2022, our billings growth should be roughly in line with revenue growth. We expect RPO growth to outpace both revenue and billings growth for the full year of FY 2022. Q1 was an excellent start to our fiscal year, fueled by strong momentum in large deals and suites attach rates. Our results, most notably accelerated revenue, billings, and RPO growth, combined with significant operating margin improvements, clearly indicate that our strategy is working as customers are placing more emphasis on the value of their content. As the leading Content Cloud, Box is uniquely positioned to solve a wide variety of high-value use cases for our customers. As we build on this leadership position, we're very confident in achieving our FY 2024 targets two years from now of a 12%-16% growth rate and operating margin in the range of 23%-27%. With that, I would like to open it up for questions. Operator? As a reminder, to ask a question, you will need to press star one on your telephone. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. Your first question comes from George Iwanyc from Oppenheimer. Thank you for taking my question. Aaron, with the success you're showing with selling Suite, can you give a sense of how you feel about your sales investment and whether you think you are at a point where you can maybe be a little bit more aggressive with hiring and kind of focusing on particular verticals and maybe regional expansion? Yeah. Thanks for the call-out. We are definitely seeing really healthy acceleration on things like our multi-product selling and, as we call out with the $100,000-plus deal stat, nearly 50% growth year-over-year, which is, I think, the highest metric that I can at least recall in the past few years. Really great start of the year on that front. As it relates to our sales investment, and Dylan called this out last quarter, we're going to be definitely investing incrementally in sales capacity, in particular in key regions and segments where we're seeing high productivity rates. We obviously want to drive efficient and profitable growth, but we do see an opportunity to invest more, and obviously, that's in the guidance from a top and bottom line standpoint. As you look at verticals, this is another area of increasing focus for us. We see really tremendous momentum in areas like financial services, life sciences, public sector, both at the federal level and even state level. Any business doing large global collaboration, so global manufacturing, professional services, the technology sector has been very attractive for us. I think you'll see us continue to incrementally invest in these high-growth verticals where data security matters, where protecting and enabling the collaboration and workflows around content is incredibly critical. We will be making further investment in those areas. This is Dylan, and just to build on that a bit, we do expect to continue improving sales force productivity for the trends that Aaron mentioned. As you said before, that was up, overall, 13% last year. While we have more modest expectations for the rate of sales productivity improvements going forward, we do expect to continue making those improvements even as we grow our sales force. In Q1, for both enterprise and SMB, we saw a strong increase in the percentage of AEs who achieved their quota, as well as a year-over-year improvement in average sales force attainment. Just one quick follow-up to that. As you see that productivity kind of tick up, and your retention rate kind of also tick up, with the growth that you're anticipating in the later part of the year, do you feel that that's something that can maybe get back to the 105%, 106% type of level that you saw early last year? Would say that based on the trends that we've been seeing from a customer expansion and churn rate, we do expect to deliver a continued improvement on our net retention rate this year. We've set the expectation that we'd end this year making a year-over-year improvement of a couple of points, so to 104%. Certainly, if we do continue to see these trends playing out, then there could be some upside to that, certainly over time. That's how we're thinking about our net retention rate currently. Thank you. Your next question comes from Josh Baer from Morgan Stanley. Thanks for the question. I was hoping to double-click on the hiring, actually. I think the growth in Salesforce that you were looking to do this year, from what Dylan mentioned last quarter, was low teens. I'm just wondering if there's an update there, if that's still the right number, how that's been tracking. We've definitely been hearing about challenging hiring environment and some companies seeing longer time to ramp there. Just looking for an update on your hiring efforts. Yeah. This is Aaron. We still intend for that metric to be the goal that we're executing on. That will be throughout the year. Overall, definitely it's an environment where there's really great opportunities for sales talent and we think we have a very attractive opportunity, and we've been ramping up on the hiring side pretty aggressively on that front. We do intend to hit that metric. Got it. With the commentary around RPO growth outpace revenue and billings growth this year, sort of setting up to see an acceleration in those revenue and billings growth metrics in the following year? Yes, I would think about that overall as being a leading indicator of top-line growth. To tease it apart, as we mentioned on the call, deferred revenues up 15% year on year, backlog up 23% year on year. Would say that backlog, because most of that's driven from the long-term backlog and in long-term RPO, doesn't necessarily get impact over revenue over the next 12 months. The overall trends that we're seeing in RPO, including healthy growth in our short-term RPO of 14% year-on-year, does definitely indicate a lot of the momentum that we're seeing and part of what leads to the confidence that we have in improving our growth rates over time. Great. Thanks. Your next question comes from Alexander Sklar from Raymond James. Great. Thank you. Aaron, you touched on return to work at the outset of your prepared remarks as being a potential driver for the business. I'm curious what you've seen so far in terms of either late stage or early stage pipeline with some of your existing customers, in terms of propensity to buy newer or incremental solutions in Box. Yeah. I think the way I would capture the two periods that we've been in would be at the first half, to some extent bleeding into Q3 of last year, it was really this remote work triage mode that customers were dealing with the backdrop of obviously a lot of economic disruption for most of businesses globally, and that's where we saw things like an SMB slowdown. We saw lower professional services slowdown as an example, the use cases customers were coming to us were really just basic remote work, file sharing, and access use cases. As we went into Q4 of last year, and certainly Q1 of this year, our conversations with customers are much more around longer term digital transformation and IT trends that we think align to our strategy. Remote work moving more into hybrid work. The benefit of that for Box is that companies are really going to need to look again at how they're managing their content as employees are working from multiple locations, as they need to be able to work from the office and from anywhere, be able to collaborate with their partners and employees and clients from all around the world. We're starting to see much longer term IT transformation initiatives emerge within our pipeline as opposed to just the rapid fire triage that we saw last year. So when you look at that metric in Q1 of nearly 50% growth in $100,000-plus deals, that's about as good as evidence as I think we could ever put up that shows customers are now being much more strategic about their long-term IT strategy, moving more content to the Content Cloud, shutting down legacy fragmented architectures, moving more of that to Box. We think we're really set up for being right at the center of these mega trends of remote and hybrid work, digital-first experiences, and data security and compliance, really driving a new way to manage content. Okay, great. Then maybe just one on the partner channel. I know typically it's been a source of strength internationally, but as you've expanded the product portfolio here, some of the things we've already talked about, and with Box Sign coming GA a little bit later, does the partnership channel look incremental? I'm just curious if it looks incrementally more or less strategic than it did previously. Yeah, it definitely looks a lot more strategic for us. International has been very strong, in particular in Japan, where it's an environment where we have very strong global partners there. As we look throughout this year, in particular as Sign comes to market and as some new functionality around platform and workflow continues to come to market, I think you'll see us have incremental focus and investments on things like system integrators, both on a global and industry basis. Whether that's in Europe, where we have a new president that's onboarding, that we'll have a focus in that area as well, as well as as we go deeper in industries like financial services, public sector, life sciences, and other spaces. I think you'll see our system integrator partnerships be even more important to that strategy. All right. Great. Thank you. Your next question comes from Jason Ader from William Blair. Yeah, thank you. You guys did very well with the $100,000-plus deals. Can you talk about what's happening with seven-figure deals and also if you've seen any recovery in the commercial segment, the sub-$100,000 segment? Yeah. On the seven-figure deals, just basically steady on a year-over-year basis. I think what we're, and what we pointed to in Q4, we wanted to move more to focusing the attention on customers with a total account value of certain thresholds, just because we think that's more indicative of our land and expand motion. As an example, that 50% growth in $100,000-plus deals is a much more meaningful metric because it moves customers into different size buckets of total spend, so we're very excited about that. Do you mind repeating the second part of the question? Yeah, just the sub $100,000 deals, the commercial segment. Yeah. Very strong momentum in the commercial segment and SMB. I think as we noted last year, there were some headwinds, mostly around the economic environment. You had SMBs that were really dealing with just the impact of COVID, not spending a lot on long-term IT infrastructure. In some cases, we saw higher churn rates in the low end of the market. As we noted in Q4, really meaningful recovery starting in Q4 and in Q1, I don't think we could be happier about the momentum that we saw in that SMB mid-market segment of the business. Really strong momentum. Obviously we only cut out the $100,000-plus deal band, but very meaningful suite sales in the SMB and mid-market segment below the $100,000 threshold. Again, really, I think that's a part of the market that's on fire for us right now. This is Dylan. The only thing I'd add is that even in that 100K-plus deal count, up 48% year-on-year, there was a pretty material contribution even from those SMB and mid-market segments, up very dramatically from where we were a year ago. Because of suites, largely, for especially the customers that are at the higher end or the larger end of that segment where that sales force serves, that was a big driver of the strength that we saw. Great, then one quick follow-up. Aaron, you guys are growing around 10% revenue this year. How do you articulate to an investor the bridge from the current kind of 10%-ish growth rate to the 12%-16% that you hope to get to? Firstly, we did just raise guidance coming in around 11% growth for the year. That's the first bridge. Second, we did have a headwind that we noted on last quarter's call around professional services that was really a flow-through from bookings last year where customers didn't need as much professional services, which obviously turns into revenue growth headwind this year in professional services. That's something that obviously we're carrying this year on the growth rate. When we look at our Q1 performance as it relates to whether it's billings growth, suites growth, customers moving into $100,000-plus deal segments, it's very evident that 12%-16% growth rate can be achieved with our current strategy. Obviously we want to continue to expand the markets that we're going after and the opportunity, but we feel very confident in achieving those long-term growth rates. Thank you. Good luck. Thank you. Your next question comes from Steve Enders from KeyBanc Capital Markets. Okay, great. Thanks for taking my question. I guess I just want to get a better understanding of the billings pull forward that you mentioned in the quarter. What would you consider kind of drove that? Was it any new product capabilities that were being upsold or any incentives that drove the contract to land this quarter instead of in Q2? Sure. No specific incentives and really the demand, and I think just desire to get onto some of these and adopt some of these more advanced capabilities faster, and suites I would really call out as the main catalyst of those early renewals, where you'd have a customer who would've ordinarily renewed in the second quarter, but given just kind of combination of being sold on the value of some of the products and capabilities they didn't yet have, and in a couple of cases, just a really strong seat growth within those companies that they were in overage is what drove those customers to ultimately renew and upsize those contracts earlier in Q1, which is what drove that $5 million of movement from expected Q2 billings into Q1. Okay. Got you. That's helpful. Then just want to touch a little bit on the guidance on the op margin side. Looks like it's coming in kind of a point or more above what you were expecting, or what the consensus was at, just kind of wondering what you're seeing or what's leading to that uptick on the margin front that's providing that upside there. Yeah. Really a combination of the stronger revenue outlook for the year based on the momentum that we're seeing, as well as been really pleased with a lot of the expense management initiatives, and especially around our infrastructure and workforce expenses, as we've driven a lot of those savings. That's what translates into that roughly 1% improvement in our operating margin expectations. Okay, great. Thank you. Your next question comes from Brent Thill from Jefferies. Hi, guys. Thanks for taking my question. I guess on capital allocation, how are you guys thinking about that? I know the funds from KKR are going to be used to repurchase shares, but I guess as we look beyond that, you do have a sizable cash position on the balance sheet. Do we think that should be more M&A driven or maybe more repurchase driven? Just maybe help outline your strategy there. We certainly look at capital allocation through the lens of what's going to deliver the most value to our shareholders. We expect to use our capital primarily to fuel growth and capture more of the market opportunity ahead of us, including M&A when it makes sense for the business and our strategy while still preserving a strong balance sheet and flexibility. Because of now our strong cash flow generation that we're seeing, we do also regularly have the conversations around things like share repurchases with the board. As mentioned, because we did raise $500 million recently on top of an already strong balance sheet is why we expect to launch our self-tender offer next week, and we'll announce all of those details at that time. Perfect. Can I have just one follow-up on Box Sign and SignRequest? I guess in your annual revenue guide, how much revenue is coming from SignRequest? On the SignRequest front, virtually nothing, so very immaterial to revenue. Certainly from Box Sign, once that's introduced and becomes generally available in the summer, very optimistic about the type of impact that can have, especially in terms of the contribution and adoption of suites. The standalone business you can think about as very immaterial. Is Box Sign currently in your updated guidance, or would that kind of just be an upside to your current guidance? That is incorporated into our current guidance. Understood. Thanks, guys. Appreciate it. Your next question comes from Chad Bennett from Craig-Hallum. Great. Thanks for taking the question. Just on the billings front, your normalized billings growth indicated was 13% for the first half. Considering the attach rates and success you've had with suites and ancillary products, why would billings growth decelerate second half? I understand comps are a bit easier in the first half, is there something that you're seeing? Everything, it sounds like from a secondary metric standpoint, seems like it would be accelerating, any kind of indication on seasonality or comps or anything that would kind of cause that? Sure. Nothing in terms of the underlying business, and continue to be very optimistic about the trajectory that the business is on. Would say that, to your point, there is not just seasonality, but did see more challenging comps in the back half of last year. Also, we just, given the timing, have a lot more confidence and predictability in terms of the sales cycles and everything that influences billings near in. We certainly do see upside to that growth, and we do expect billings growth to exceed revenue growth for the full year. There's nothing in terms of the underlying trends that we're seeing in the business that drives that. Okay, maybe one follow-up real quick. I think last quarter you spoke of, Dylan, I think you gave kind of a net new bookings growth metric. I think it was up something like 24%. Is there any update to how that performed this quarter? Not sure what you're referring to. Could you clarify which metric? We don't typically talk about our bookings for the business overall. Yeah, I guess trying to get an indication of kind of net new logo bookings and how that trended in the quarter. Okay, got it. Yeah, that's been pretty consistent with what's been the past few quarters. I think we did call out that in Q4 it was particularly strong because of some large net new wins, both in SMB as well as in Japan. It's back at pretty normal levels, where we tend to see about 70% or so of our bookings coming from our existing customers and about 30% coming from net new customers. Okay. Thanks much. Your next question comes from Erik Suppiger from JMP Securities. Yeah, thanks for taking the question. First off, you noted the billings growth will be faster than the revenue growth. Can you give us some flavor or context around the difference that you would anticipate, obviously, that was meaningful in the first quarter here, but how's that going to be as we progress forward? How is that difference going to evolve? Yeah. Would say that for now, we'd think about the billings growth in the back half of this year to be fairly consistent with our revenue growth in the back half. The slightly higher expectations that we're setting are based on the first half 13% year-on-year growth that we've seen. Certainly, as we move and head into next quarter, we'll give more color into how our billings expectations are shaping up for the back half of the year. Okay. Very good. Thank you. That was our last question at this time. I will turn the call back over to the presenters. Great. Well, thank you. We, again, very excited about the momentum in Q1 and looking forward to following up with all of you soon. This concludes today's conference call. Thank you for participating. You may now disconnect.