Good day, and thank you for standing by. Welcome to CyberArk Fourth Quarter and Full Year 2021 Earnings Call. At this time, all participants are in a listen-only mode. After the speaker 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, Erica Smith. Please go ahead. Thank you, April. Good morning. Thank you for joining us today to review CyberArk's fourth quarter and year-end 2021 financial results. With me on the call today are Udi Mokady, Chairman and Chief Executive Officer, and Josh Siegel, Chief Financial Officer. After prepared remarks, we will open the call up to a question-and-answer session. Before we begin, let me remind you that certain statements made on the call today may be considered forward-looking statements, which reflects management's best judgment based on currently available information. I refer specifically to the discussion of our expectations and beliefs regarding our projected results of operations for the first quarter and full year 2022. Our actual results might differ materially from those projected in these forward-looking statements. I direct your attention to the risk factors contained in the company's annual report on Form 20-F, filed with the U.S. Securities and Exchange Commission, and those referenced in today's press release that are posted to CyberArk's website. As well as risks regarding our ability to continue to transition the business to a subscription model, the duration and scope of the COVID-19 pandemic, its related impact on global economies, and our ability to adjust in response to the COVID-19 pandemic. CyberArk expressly disclaims any application or undertaking to release publicly any updates or revisions to any forward-looking statements made today. Additionally, non-GAAP financial measures will be discussed on this conference call. Reconciliations to the most directly comparable GAAP financial measures are also available in today's press release, as well as in an updated investor presentation that outlines the financial discussion in today's call. We also wanna remind you that we provide the calculated revenue headwind for additional color on the impact of our subscription bookings mix shift, but it should not be viewed as comparable to or a substitute for reported GAAP revenues or other GAAP metrics. A webcast of today's call is also available on our website in the IR section. With that, I would like to turn the call over to our Chairman and Chief Executive Officer, Udi Mokady. Udi? Thanks, Erica, and thanks everyone for joining the call this morning. It was a record-breaking year for CyberArk, best characterized by transformation, outperformance, and acceleration. Momentum continued to build as we moved through 2021, culminating in a record fourth quarter. The most important takeaway from Q4 is that we experienced another step function increase in demand for our platform, with our SaaS solutions driving our performance. We delivered the largest-ever sequential increase in ARR, off an incredible record Q3. Subscription ARR reached $183 million, and growth accelerated to 146%. Total ARR reached $393 million, and growth accelerated to 44%. Again, in the fourth quarter, we significantly beat our bookings assumptions, resulting in total revenue of $151 million and a 71% booking mix with a $33 million calculated revenue headwind, all above the guidance framework. While the subscription transition masks the underlying growth of the business, if you adjust for mix of bookings, our license line grew by about 40% in the fourth quarter. Geographically, we had another perfect game. Every region outperformed our guidance framework. From every angle, it was a stellar quarter. Operationally, we outperformed against our strategic imperatives to drive growth, execute our subscription transition, continue to deliver innovation, and profitably scale our operations. I will frame today's discussion around these pillars, starting with growth. We are in one of the best positions, if not the best position, to drive long-term sustainable growth. The strong secular tailwinds of digital transformation, cloud migration, and attacker innovation gathered more steam in the fourth quarter and continued to push identity security to the center of every customer discussion. As we all know, 2021 kicked off under the dark cloud of SolarWinds, and we ended the year with the Log4j vulnerability, with countless attacks in between. Most recently, CISA published an advisory of a state-sponsored advanced persistent threat or APT. In this attack and others throughout the year, stolen credentials were the common denominator leveraged in the attack chain. The threat landscape is the most aggressive that I have ever seen. With our foundation in PAM, we are in the best position of any vendor to address the identity security challenge. Our results demonstrate that enterprises agree. While post-breach activity is a small part of our business, we have been pulled into engagements in the wake of these attacks as the second call behind remediation firms because of our trusted advisor status as cybersecurity experts. Beyond secular tailwinds, we made the right strategic moves at the right time, supercharging the acceleration of our business. We formally rolled out our transformation program early in 2021, creating centers of excellence in PAM, access, and DevSecOps, unifying our experience under one umbrella, our customer experience under one umbrella, and driving the business towards a recurring revenue. Each quarter in 2021 was significantly better than the previous, with our execution kicking into an even higher gear in Q4 off an incredible third quarter, as I mentioned. Importantly, productivity is back well above 2019 levels. This, combined with the increased sales capacity, creates a strong foundation for growth in the quarters ahead. SaaS reached yet another record with particular strength in Privileged Cloud, Endpoint Privilege Manager, and CyberArk Identity. The growth in our privileged access solutions outstripped industry estimates for 2021. On the access and DevSecOps front, the increased focus and specialized resources significantly improved our competitive position. From a bookings perspective, access more than doubled in 2021, and we had key competitive enterprise wins for Secrets Manager. We will talk about innovation in a bit, but Secure Web Sessions and Dynamic Privileged Access are game changers, moving us further ahead of competition. Optimizing our go-to-market machine paved the way for our record new business quarter, with more than 375 new logos added during the quarter and a material increase in new business deal sizes. A few new wins to highlight. As part of its digital transformation, a large broadcaster bought our identity security platform because of its foundation in PAM, including Privileged Cloud, Endpoint Privilege Manager, Secrets Manager, Remote Access, and Cloud Entitlements Manager. A travel and transportation company that had outgrown a competitive PAM offering is moving to Privileged Cloud because of our scalability and fast time to value. This customer is one among many turning to CyberArk to meet today's rigorous cyber insurance requirements, a trend we expect to pick up in 2022. The crippling effects of ransomware contributed to our record year for EPM and also the strong growth in PAM. Our two largest deals in the quarter were expansion from PAM into EPM. We signed our largest ever EPM deal with a European manufacturing company and a major deal into a large U.S. bank. In fact, EPM was in eight of our top 10 deals in the quarter. With our subscription model resonating and SaaS taking off, the velocity of our business is picking up steam, with customers adding on both more users and more products faster. As examples, expanding from PAM into identity, a regional investment bank that has been a CyberArk customer since 2012 and required the efficiency of Workforce Identity for all of its users and is also to Secure Web Sessions. As part of a broad PAM program, an existing insurance company customer needed a single pane of glass for managing all human and non-human identities and expanded from core privileged access into Secrets Management. Traditionally, our customers have leveraged PAM as a jumping-off point for their identity security programs. As our platform motion is gaining momentum, we are excited to see newer EPM and CyberArk Identity customers expand into PAM. In Q4, a global food manufacturing company and CyberArk Identity customer expanded their CyberArk program with Privileged Cloud, Remote Vendor Access, and EPM. Strengthening our partner program was another focus area in 2021. We are deepening our relationships across our VARs, global system integrators and advisories, managed security service providers, cloud marketplace, and C3 partners. On the cloud marketplace side, our business with AWS continued to gain traction in the fourth quarter, and our pipeline quadrupled. Marketplaces are a productive, efficient, highly scalable, complementary new route to market for CyberArk. Moving to subscription transition, our transformation is well on its way, and as we mentioned, we outperformed again in the fourth quarter. Our SaaS products continued to lead the way, and we are already seeing the flywheel effect. We are confident this will result in higher lifetime value. We now have more than 890 customers with over $100,000 in annual recurring revenue. Given our success in 2021, we are accelerating the transition exit and expect to reach about 85% of bookings from subscription in the second quarter of 2022 or in just six quarters, which is well ahead of our initial timeline outlined in February of 2021. Innovation is a core pillar of our growth strategy, and in 2021, we introduced Secure Web Sessions and Dynamic Privileged Access. The pace of demand for Secure Web Sessions is incredibly strong. In the first few weeks after GA, we have key wins and strong pipeline heading into 2022. Secure Web Sessions harnesses the power of both IDaaS and PAM, providing PAM security and controls with a frictionless user experience. It is an elegant solution, and no other vendor in the market can provide this level of operational efficiency and security in a single platform. We also won early Dynamic Privileged Access for DPA customers in Q4. DPA uniquely positions CyberArk as the only vendor who secures both standing and dynamic privileges regardless of environment, from born in the cloud to hybrid to self-hosted. We are hearing from customers that the combination of DPA and Secure Web Sessions changes the competitive landscape for identity security. I will wrap up my discussion with some comments on profitability. Our investments in 2021 delivered exceptional returns. With our strong execution, the inflection in the demand environment, and our incredibly favorable competitive position across PAM, access, and DevSecOps, we plan to invest in growth and innovation in 2022. Our investments demonstrate the confidence in our unprecedented opportunity as identity-centric security models are now a requirement. Our approach to investment hasn't changed. We invest in step with the demand, are focused on impactful spending, and given our track record, are confident in our ability to deliver long-term profitable growth. Our priorities heading into 2022 include completing our subscription transition by the second quarter. Invest in our global sales organization, including our partner ecosystem, to drive growth. Protect our ARR by investing in customer success, support and services, and invest in research and development to enhance our identity security platform and drive innovation. With our turbocharge performance in the fourth quarter, we are in an incredible position to execute against our massive opportunity. I will now turn the call over to Josh, who will discuss our financial results in more detail and provide you our outlook for the first quarter and full year 2022. Over to you, Josh. Thanks, Udi. We'd like to remind you that we posted slides to the website that will be helpful as we walk through our results. As Udi mentioned, we had a record fourth quarter, capping off an incredible year of acceleration, outperformance, and transformation. In terms of the headline P&L, we generated record total revenue above the high end of the range of $151.3 million in the fourth quarter, with a 71% mix of subscription bookings. That is ahead of our guidance framework of the 68% mix. We were thrilled to again see both revenue and mix outperformance really a great demonstration of the strength in our bookings. Before digging deeper into the P&L revenue, I wanna highlight our annual recurring revenue, which illustrates the step function change in the demand environment for the fourth quarter. We experienced our largest ever sequential increase, adding $44 million to the subscription ARR in the fourth quarter alone. The subscription portion of our annual recurring revenue reached $183 million, representing over 46% of the total, and year-over-year growth accelerating to 146%. Just one year ago, the subscription portion was only $74 million or 27% of total. Our total ARR was $393 million. That is an acceleration to 44% year-over-year versus 38% year-over-year growth that we showed in the third quarter of 2021. The maintenance portion was $210 million at December 31 and reflects our strong renewal rates. The acceleration in our ARR is driven by the strong demand environment, transformation of our business, and great execution of our go-to-market engine, all of which sets us up very well for 2022 and beyond. In addition, we are pleased with our increased visibility from the strong execution of our transition. We ended 2021 with remaining performance obligation of $516 million. That is 42% growth from year-end 2020. Moving to revenue. Subscription revenue that includes SaaS and self-hosted subscription reached $47.6 million and represented 31% of total revenue in the fourth quarter. That's increasing 142%. Consistent with our transition progress, perpetual license revenue declined to $38.7 million. Our maintenance and professional services revenue was $65.1 million, with $55.3 million coming from recurring maintenance and $9.8 million in professional services revenue. Recurring revenue, defined as our total subscription plus our maintenance related to perpetual license revenue, reached $102.9 million or 68% of total revenue, growing 48% year-on-year. We continue to have a SaaS-heavy transition, with nearly 50% of our total bookings coming from SaaS. With our mix reaching 71% in the fourth quarter, we have made great progress transforming CyberArk into a subscription company. Economically, the headwind created by the mix was approximately $33 million in the fourth quarter when we compare it like-for-like to the mix in the fourth quarter of 2020. Normalizing for the mix shift, growth in the license portion of the business, our SaaS, self-hosted subscription, and perpetual would have grown about 40% and demonstrates the underlying growth in the business. Taking the calculated revenue into consideration, total revenue growth would have accelerated to 28% year-on-year. New business also accelerated in the quarter. We signed more than 375 new customers, and that's a record. New business average deal sizes also increased by just over 20% in the fourth quarter, driven by strong demand for SaaS in particular. Geographically, the business is well-diversified. The Americas generated $86.2 million in revenue, representing 57% of total revenue. The Americas again had the strongest percentage of SaaS bookings during the quarter. EMEA had $49.3 million in revenue, or 33% of total revenue, with SaaS bookings more than doubling over the last year. APJ generated $15.8 million in revenue, or 10% of total revenue, with SaaS and subscription now over 50% of bookings for that quarter. If we look across the geographies adjusted for the calculated revenue headwind created by the mix, each region would have grown by over 25% in licensed revenue, with our license line growing over 25% in EMEA, about 45% in the Americas, and over 60% in APJ. Normalizing for the revenue headwind, our license line grew over 30% in each region on a full year basis. All line items of the P&L will now be discussed on a non-GAAP basis. Please see the full GAAP to non-GAAP reconciliation in the tables of our press release. Our fourth quarter gross profit was $130.1 million, or an 86% gross margin. That's compared with 88% gross margin in the fourth quarter last year, primarily the result of the increase in our SaaS business in 2021. We continue to make investments to drive innovation and growth, resulting in operating expenses of $113.8 million, a 31% increase year-over-year, and operating income of $16.3 million in the quarter, significantly beating the high end of our guidance. It is important to remember that our operating income is lowered by $2.2 million from foreign exchange and the approximately $33 million calculated revenue headwind. Isolating for the calculated revenue headwind, our operating margin would have been approximately 26%. Adjusting for the FX impact, the margin would have increased by another 2 points to 28% in the fourth quarter of 2021. Net income was $11.8 million or 28 cents per diluted share for the fourth quarter. For the full year, revenue was over $500 million, and that's a great milestone for CyberArk, reaching $502.9 million with a 66% subscription bookings mix for the year. This resulted in a $74 million calculated headwind for the full year. Taking the economic impact from the headwind into consideration, the year-on-year comparison would be over 35% licensed revenue growth and 24% total revenue growth. To underscore how great a year 2021 was for CyberArk, I wanted to reflect on the guidance we set in February 2021. The top of our revenue range was $496 million, and that assumed a 55% mix and a $39 million headwind. We generated revenue above the range, and our mix reached 66% or 11 percentage points above our framework, which resulted in a total calculated revenue headwind in 2021 of $74 million. The bookings underlying our results materially beat the assumptions in our guidance. As Udi mentioned, there was a step-up function increase in demand for our solutions, with momentum building both in our bookings and in our pipeline as we moved through the year. Moving to the full year P&L, operating expenses increased by 31% as we invested to deliver against the strong demand. Operating income was $23.9 million, and our EPS was $0.33 per diluted share for the full year. We continue to attract and retain top talent, a testament to our culture and our success in the market, adding 450 new employees in 2021, the highest number in a single year. We ended December with over 2,100 employees worldwide, with 942 employees in sales and marketing. For the full year 2021, free cash flow was $65.8 million or a 13% free cash flow margin. This cash flow contributed to our strong balance sheet, and we now ended the quarter with $1.2 billion in cash and investments. Turning to our guidance. Our guidance for the first quarter of 2022 and the full year reflects the robust industry tailwinds, our record pipeline build, incredible execution, and the acceleration in our bookings. For the first quarter of 2022, we expect total revenue of $125 million-$133 million. We expect a non-GAAP operating loss of about $16 million to $9 million for the first quarter. We expect our EPS to range from a non-GAAP net loss of -$0.42 to -$0.25 per basic and diluted share. The guidance assumes a jump up to about 79% of subscription bookings mix and a calculated revenue and profitability headwind of approximately $13 million for the first quarter of 2022. If you isolate our license lines of SaaS, self-hosted, subscription, and perpetual, the normalized growth rate, taking into account the calculated revenue headwind for the first quarter, would be over 50% year-on-year for just the licensed portion. Similarly, for the total revenue, the growth rate would be at 26% at the midpoint of the range, taking in the headwind into account. Our guidance also assumes 40.3 million basic and diluted shares and about $2 million in taxes. Looking at the full year 2022, we expect total revenue in the range of $582 million-$598 million. The mix assumption underlying our guidance for the full year is 85% from subscription bookings, and our revenue headwind is approximately $53 million. Now moving down the P&L. For the full year, we expect non-GAAP operating loss to be between $34 million and $20 million. We expect our non-GAAP net loss per basic and diluted share to be in the range of $0.98-$0.64. For the full year, we expect about 40.7 million basic and diluted shares and about $10 million in taxes. For the full year, the increase in our expenses are related to four more major areas, increasing investments in our cloud infrastructure to support our record SaaS bookings in 2021, which will lower our gross margin for the full year to between about 80%-81%. Changes in exchange rates are increasing our expenses by about $7 million over 2021, in particular for R&D and G&A. We are continuing to make critical investments in R&D, including our SaaS and self-hosted solutions. Lastly, the investments in sales and marketing. We have deep conviction in the opportunity and our incredibly strong competitive position. More importantly, our productivity levels continue to increase, our win rates are strong, and our pipeline is at record levels, which supports productively stepping up our investments to help ensure we capture the opportunity and sustain our strong growth in 2022 and beyond. At our Investor Day in March of 2021, we discussed the trajectory of the transition, which we expected to take eight-10 quarters and ARR to grow at about 30% through the transition. Given our success in 2021, we now expect to hit our original transition target of about an 85% mix from subscription bookings already in the second quarter of this year, or only six quarters from when the transition kicked off in the first quarter last year. As we have consistently pulled in the subscription timeline, it impacts both the growth and profitability curves of the transition. The rebound in revenue is already starting in 2022, with 17% growth and about 32% growth in the license lines expected at the midpoint of the guidance range. As with any transition, a faster timeline has an impact on the bottom line, creating a deeper near-term bottom in margins. While the shape of the transition in terms of revenue growth and operating margin is relatively consistent, the slope of the curves we talked about in March last year are steeper with a faster transition now. Given the acceleration in our business, we expect annual recurring revenue to be between $530 million and $536 million at December 31, 2022, or 36% growth year-on-year at the midpoint. As we look into 2022, we do expect the maintenance portion of ARR to begin to decline. While this will drag the total growth rate, we expect rapid growth in the subscription portion. With our strong performance in 2021, we are on our way to meet $1 billion ARR target, which we now believe we can achieve already by June of 2025. In terms of free cash flow, we anticipate that it will be in line with our non-GAAP net income margin over a 12-month period. We also expect capital expenditures to be in the range of $15 million-$16 million, which represents just about under 3% of revenue at the midpoint. The fourth quarter was a standout quarter to round off an amazing year at CyberArk. The business is firing on all cylinders. As we look ahead, we expect to hit our subscription transition target goal much faster than we originally anticipated. Our sustainable growth drivers, paired with outstanding execution from our team, put us in a great position to deliver long-term growth and profitability. I will now turn the call over to the operator for Q&A. 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 or hash key. Please try to limit yourself to one question. We'll pause for just a moment to compile the Q&A roster. Your first question is from Saket Kalia with Barclays Capital. Okay, great. Hey, guys. Thanks for taking my question here. Great to see the ARR acceleration. Thank you, Saket. Maybe if I can just a two-part question that's kind of related for both of you. Udi, again, on the ARR acceleration, just starting high level, what do you think is driving the demand? It sounds different, so I'm just kinda curious how you'd position that. Josh, for you, the guide for next year assumes nice growth in net new. You know, you touched on some of this in your prepared remarks, but can you just kinda lay out a little bit more about sort of what gives you the confidence in guiding to that healthy net new ARR? Sorry, there's a lot there, but does all that make sense? Absolutely. I'll kick it off. We really executed. I would say executed and fired all cylinders against a strong and growing demand environment. What we're seeing is that companies are recognizing the importance of PAM and identity security as that layer and the platform you need in an assumed breach environment, in this heightened threat environment, whether it's back to vulnerabilities like Log4j or SolarWinds and others. You have to assume breach, and we call it assume identity. What are the attackers gonna go after? How will they propagate the attack? Also identity as a landing point. Our organizations are aware of the importance of this layer with Privileged Access Management at the center and of course expanding to identity security controls. They partner with the market leader in the space that can support their complex hybrid environment and continuously invest in innovation. I would say that we're in one of the most best competitive positions we've ever been. It's very clear if you look at the growth of the business in 2021 that in light of industry reports, analyst reports, that we're taking market share going after this demand and executing against it and always innovating so that the customers see that we have their back for the long run. Yeah. Saket, I'll add to the follow-up of your question. You know, based also on what Udi just talked about in terms of the demand environment, you know, I can look under the hood, and we talked about record pipeline growth during last year. We look at our pipeline levels and our win rates. We also looked at the execution that we're coming out of Q4 with, that we're going into this year with, and our productivity levels from our go-to-market teams in the last quarter and really over the last several quarters. I think the third point is that we, you know, we talked about the hiring this year. We have built capacity to be able to meet that accelerating demand environment. We really are confident about how we look at 2022. Makes sense. Thanks, guys. Thank you. Your next question is from Jonathan Ho with William Blair. Hi, good morning, and let me echo my congratulations on a very strong quarter as well. I guess one thing I wanted to understand a little bit better is, you know, where do you see this opportunity to incrementally invest on the sales and marketing side? Are there any particular geographies or verticals or, you know, that these new marketplaces? Can you just really help us understand, you know, just given the strong backdrop on, you know, where you can have the most impact? Thank you. Yeah. Right now, we're seeing demand increase both in enterprise and in our commercial business, and we're growing across those two dimensions and globally, the global opportunity across the organization. Of course, the partners are right in step with us. There's investment in everything that has to do with increasing our work with the channel partners around the world. Of course, everything that we're doing around securing the ARR around customer success and walking our customers through this cycle. We're very excited to see the platform in play and some of the examples I gave of customers really moving cross products, taking more users, but also going cross product. Of course, we have the speed boats that are a unique motion for us, for both access and DevSecOps, and that's another part of our investment. In all of the above, we're confident that we're like we saw in 2021, that we'll see great returns on that. Your next question is from Hamza Fodderwala with Morgan Stanley. Hey, guys. Thanks for taking my question. I wanted to follow- up on a question in line with what Saket asked. Josh, for you, Udi obviously did a great job highlighting a lot of the growth drivers for 2022. If I look at your ARR guide, and I assume, you know, maintenance, let's assume it just stays flat. You're guiding for about 30% growth in net new sub ARR after what was a really strong acceleration in 2021. I'm curious how much of that is attributed to this demand inflection that you've spoken so clearly about in the back half of last year versus a faster transition? To put it bluntly, do you feel like you've given yourself enough wiggle room to really outperform like you did last year? You know, thanks. I think you got it right, and it was important that you talked about the maintenance piece of the ARR as well, because we do actually, and I called it out in my prepared remarks, that we will probably start to see the decline even on the maintenance ARR, but then the super growth rate on the subscription piece of the ARR. You know, the confidence, again, it's really coming from first of all, the faster transition and also the SaaS heavy side of the transition. We're seeing Privileged Cloud really being a big piece of that. And not just, we're also seeing Privileged Cloud also going even further up market. We talked a little bit about our average deal sizes going up, as well, especially for new logos. It's really tied to Privileged Cloud success also further upmarket and the value that our customers and the enterprises are seeing in the subscription packages and on for the self-hosted, as well. You know, I think that we feel confident about the ARR growth, you know, about overachieving. You know, we put out the number in our guidance, you know, that we feel comfortable, given what, given the information we have in front of us. You know, we had great execution in 2021, but, you know, for now, the guide is the guide. Absolutely, the demand environment is there for us to invest in. Your next question is from Sterling Auty with JP Morgan. Hey, this is Doug on for Sterling. Thank you for taking my question. In regards to the growth in subscription revenue, can you talk about how much of that is coming from new versus existing customers? Yeah. If we look at our ARR incremental, we're seeing about 1/3 of it coming from new customers and the balance coming from existing customers. Okay, great. Thank you. Thanks, Doug. Your next question is from Rob Owens with Piper Sandler. Great. Good morning, guys. Thanks for taking my question. Want to double-click a little bit around the DevSecOps portfolio to understand, is a lot of that coming from new customers? Is it an add-on? Is it being added into deals? Is it the actual tip of the spear with new customer acquisition in some cases, or are you seeing it more, as part of a suite as customers are looking at this more holistically? Thanks. Absolutely, Rob. Yeah, I would say new tips of the spear are much more EPM and CyberArk Identity as new landing places for us. Strategically, that was our plan. The Secrets Management and the DevSecOps portfolio is much more of an add-on business to existing customers as they expand from the humans to machine identities. As we really support that motion with an overlay team to cater to those needs. Of course, customers want that full platform that covers both the human and machine. That's primarily the case, and it's part of the CyberArk Blueprint on how we guide customers to go deep in identity security. Thank you. Thank you. Your next question is from Gregg Moskowitz with Mizuho. Yes. Hi, this is Mike on for Greg. Thanks for taking the question. I was just wondering, have you made any changes to your sales incentives in 2022 to increase the emphasis of SaaS vis-a-vis perpetual licenses or perhaps even term licenses? Yeah, I would say the major transitions were in 2021. I would say that we further ratcheted it up in 2022. We recently had our global kickoff, and it's very clear that we are incentivizing our team to sell SaaS and subscription for sure. I would say a further ratchet up on some of the things we put in motion in 2021 already. Great. Thanks. Thank you. Your next question is from Brian Essex with Goldman Sachs. Hi, good morning, and thank you for taking the question. Maybe just one for Udi. You know, and maybe more of a longer-term strategic type of a question, but if we think about the growing number of enterprise class companies with cloud-native architecture, I'm thinking more like a, I don't know, Zoom or Airbnb. I know it's early stages, but maybe you can hit on three areas in particular. Curious to see how you're seeing those types of customers invest in Privileged Cloud or privileged access differently than those more traditional or hybrid models. How do their privileged access strategy and attach evolve over time? How different is your go to market for those deals as you know, as you're establishing CyberArk to compete in those markets? No, absolutely. I think one of the important strategic initiatives for us is to cater to all types of enterprises, and we're actually seeing a growing success in born-in-the-cloud type entities because we give them so much optionality. They can consume Privileged Cloud as a service. They can consume our EPM as a landing point for least privilege on the endpoint, and also our new innovations around like DPA, Dynamic Privileged Access, allows them to manage workloads in a just-in-time environment. I would say with some of them, the landing and the beginning part would be different from a hybrid environment. They may look at more traditional core assets to start with first, defending Active Directory, defending critical servers. The opportunity is very large. They typically have a large number of users, cloud native or born in the cloud, a large number of users, both from a privileged user definition and of course from a workforce definition, and a large number of machine identities that we can help solve with our secrets management. Great. Very helpful. Thank you. Thank you. Your next question is from Tal Liani with Bank of America. Hi, guys. I have two questions. First is, can you talk about seasonality? I see that fourth quarter last year was also strong, and I'm wondering if there is any new seasonality that we need to consider that fourth quarter is becoming so strong. Second, demand is being created somehow. You spoke about very strong demand. I'm trying to understand if the demand just happened or you helped it through sales channel relationship or anything that could explain this demand. I have a question on margins. All right. Great, Tal. I'll kick off maybe with your second question on channel and hand it over to Josh to talk about seasonality. I think as I started, first off, the biggest change is in the demand environment and the centrality and the importance of Privileged Access Management and identity security. As we have been investing in taking a leadership position in what's making money for our channels. I mean, many of our large VARs out there, we would be in their top five, top 10 vendors, and they're giving it more attention, advisories, building practices around CyberArk. New motions around, if you talk about some new motions around MSSP and what I mentioned with the AWS Marketplace. I would say the ongoing investment and the growing priority within the customer and within the channel helped us really execute on the strong pipeline that we've built. Yes, some new channel motions introduced as well. On seasonality, Tal, no, I think, you know, we're still very much, you know, an enterprise security software vendor. This is kind of the nature of the beast. We're seeing, I think, strong fourth quarters as we have for a while. We don't necessarily anticipate, you know, a change at this point. I think it's pretty much then. Got it. Josh, just on margins. You're going through an investment phase now in cloud infrastructure. What's the outlook? I'm not looking for specific numbers beyond, but what's the outlook? Is this gonna be multiple years of elevated investments, or is it more of an initial investment followed by margin improvement as your volume goes up? I'm trying to understand to what extent you need to invest over the next few years. Yeah, you know, I think we're continuing to invest really into 2022 the same way that we've been looking at it over the last, you know, since you've been following us since the public offering, which is investing with the growth and the demand of the market and investing ahead of it to ensure that not only are we going to be able to meet the current year's growth, but we're always looking at it kind of for multiple years, and we wanna set ourselves up for going into the following year to be able to meet the new capacity and the new growth for the following year as well. So I don't think anything's really changed. There isn't a specific, you know, incremental investment for 2022 that isn't more of because we're seeing a bigger demand and we're scaling the company. At this point, that's what I would say, looking forward as well. Okay, thanks. Your next question is from Adam Borg with Stifel. Great, thanks so much for taking the question. Maybe just for Udi on Endpoint Privilege Manager, it was great to hear the success and some of the deals you called out earlier. Maybe just remind us kind of where we stand now as in terms of the mix of ARR and what kind of uplift it provides relative to a traditional PAM deal. I'm sorry. Can you repeat the last part of the question? Yeah, absolutely. What kind of an uplift does EPM provide relative to, if you just started with core PAM or Privileged Cloud, what does EPM uplift look like? Yeah. You know, first of all, in terms of the outlook for the EPM, it's basically can be, you know, when we're looking at it on a SaaS perspective, Erica, do you have that number? Sure, yeah. I think he started off with what EPM was as a percent of the ARR, which is about 22%, and so right north of 20. Yeah. We're north of 20% now of the EPM portion of the ARR. Great. And- Yeah, no worries. Any color on if a standard core PAS or Privileged Cloud deal is $1, what kind of uplift EPM looks relative to that? Probably about, I would call it about half of that, an additional 50% on top of core PAS. Awesome. Thanks so much. Your next question is from Jonathan Ruykhaver with Baird. Yeah. Hey, guys. Congrats on the strong performance. Udi, you've talked about PAM-like controls for adaptive, you know, Secure Web Sessions particularly, which seems to be doing extremely well. I'm curious if you could just talk broadly how you're thinking about this, you know, identity security positioning strategically, just given the importance of privilege and, you know, what could we see in terms of additional security controls for the product portfolio that further differentiate? Thanks, Jonathan. The fresh new things that we've rolled out are, like I mentioned, Secure Web Sessions and Dynamic Privileged Access. You'll see us, and again, as Secure Web Sessions is very new, but we're seeing great excitement from customers to be able to defend the regular user. It could be somebody in HR, finance, and others, but to be able to put controls and protection over their session that are PAM-like, but in a transparent way to the user, you know, even the ability to protect the session itself. That's new, and you'll see us extending that notion of bringing PAM-like controls in a transparent way to the regular user. It also will take place in how we continue to advance our continuous authentication, making sure that we work in a continuous Zero Trust and continuous verification model. The other long-term and continuous investment we have is everything just-in-time to give more and more optionality for our customers to protect standing access, but more and more just-in-time scenarios like Dynamic Privileged Access, which is brand new, and is a great differentiator for us. Stay tuned. I think that's gonna be why customers select CyberArk. They know that it's coming from the makers of PAM. We're now coming to you with solutions for your workforce, for your vendors, for your third parties, leveraging the same platform. That's helpful. Thanks, Udi. Thank you. Your next question is from Ittai Kidron with Oppenheimer. Yeah. Hey, guys. Great quarter. A couple for me, maybe, Udi, for you on the SaaS side. I wanna double-click on that a little bit. Is there any way you can unpack this for us a little bit in the context of how's the adoption between new customers and existing ones? With respect to new ones, is it bringing to the table new customers that you didn't have access to before? I'm just kinda trying to understand how this changes the landscape from a customer standpoint. For you, Josh, just wanna make sure on your guidance for the year, you know, with inflation all around, are there any price increases that you're implementing? And if so, how have they been worked into the guide? Thanks. I would say that the SaaS solutions definitely have opened up, and we're seeing that proof in new opportunities. If you take a look at the new logos, just the record new logos in Q4, about half of them would be what we would call from the commercial market, which are still kind of the small type of enterprise, but a new expansion for us and really across verticals. The ability to be able to consume Privileged Cloud and EPM SaaS, and of course, our CyberArk Identity, it opened up opportunities further down market. I would say cross enterprise, the fact that they can get quicker time to value in such an important layer against this threat environment, it just really expanded our opportunity to give so much optionality to customers. It's really across the board there. Yes, with regard to the prices, Ittai, so basically, we didn't do across the board because of inflation increases, but we did absolutely have some price increases across certain products and services. It is included in terms of the context of our guide as well. Very good. Thank you. Your next question is from Fatima Boolani with Citi. Good morning. Thank you for taking my questions. Josh, this one's for you, just with respect to free cash flow. It was nice to see the outperformance this quarter. If you can help walk us through some of the thought process for calendar 2022 as you reinvest, as you accelerate the timeframe, by which you are going to complete your subscription transition, as well as, you know, some of the drag from maybe the perpetual maintenance are fading away. Anything you can help us, you know, vis-a-vis those factors and how we should be thinking about the shape and the complexion of free cash flow in 2022, that'd be really helpful. Thank you. Yeah. Great. You know, in the cash flow, we will definitely see some seasonality in the cash flow. We probably will see it being on the positive side in the beginning of the year, in the early quarter. During the middle of the year, it'll go down. Towards the end of the year, we can see again some improvement on the cash flow. It'll be kind of strong in the middle quarters. It'll be weaker, and then towards the end, it could be stronger again. Thank you. Good to have you here, Fatima. Your next question Thank you Udi. is from Joshua Tilton with Wolfe Research. Yeah, guys, thanks for taking my question. Historically, you guys have kind of been the 800-pound gorilla in the room in the on-premise PAM market. As you move to the cloud, would you say your win rates suggest that you kind of maintain this status? Have you maybe become the 1,000-pound gorilla? Any commentary on kind of the competitive environment and how your position has changed, as the PAM market moves to the cloud would be great. Yeah, yeah. Absolutely. That's one of the most exciting elements for us is that we are the market leader, no matter how you slice it, in PAM and in Privileged Cloud. The solution, it basically has, you know, in past investments caught up and then went beyond what we offer on-prem. Customers can really get the full solution with Privileged Cloud, and we're seeing great win rates and the ability for the customer, like I said earlier, to get quick time to value and expand faster. I don't know what props to give it there. You know, if we were to just slice it and say, "Hey, how's the leadership from a PAM perspective in SaaS where the clear market leader is there, just like we showed up on the Gartner Magic Quadrant three years in a row. In this space, we're seeing that the PAM players have been continuously disrupted by PE and changing hands over the last couple years and really didn't invest in R&D, while CyberArk has continued to invest in R&D and innovation and continued to open up a strong gap. Take it into the platform approach where we're approaching everything as a platform sale, and customers can see, well, we're starting with you with Privileged Cloud, but wow, you can also secure me on the endpoint, in Secrets Management or on my workforce and vendors. So that's really another great differentiator there for the SaaS function. Udi, I want to interject here and just call out a correction. We said earlier that the EPM was 20% of total ARR, and I want to make sure that it was clear that it was 20% of subscription ARR was for EPM. Sorry for that. Your next question is from Roger Boyd with UBS. Oh, thanks for taking my questions, and congrats on the nice end of the year. Udi, you had mentioned the impact of the tighter cyber insurance market at the tail end. I'm just wondering relative to what we're seeing there, higher premiums, lower capacity. Is it possible to talk about maybe what% of new deals you're seeing being influenced by cyber insurance conditions and maybe how you expect that tailwind to hold up in 2022? No, no, thanks for that. I would say it's still not a percentage I could put out there. It's more anecdotal, but it's coming up in conversations as another reason. I don't think we're dependent on this driver in any shape or form, but it's an additional driver that's added to everything we've seen before. First of all, the clear understanding that organizations need it, but now they're already getting asked for it for different elements of identity security, Privileged Access, Secrets Management, elements of MFA and protecting the workforce. The fact that they're clearly asked for it as a condition for cyber insurance is, I would say, an additional tailwind. We do expect it to persist. We think that it's just emerging. The cyber insurance companies and we know many of them, they're finding that all of their subscribers are in some shape or form getting attacked, and they wanna put meaningful layers in place to minimize damage. Privileged Access Management and identity security is one of those no-brainer layers. Terrific. Thanks a lot. Thank you. Your next question is from Imtiaz with Guggenheim Partners. Hey, guys. Fine. I had a question about Idaptive. It's been almost six quarters since you acquired the company. Do you have the ability to hold the ARR run rate for Idaptive today? I have a follow-up. Sorry, I didn't hear the end of that. He wanted. The Idaptive, the ARR contribution from Idaptive, your, the identity product. Yeah. Basically It continues to increase. After the first year, where we saw the migration into CyberArk, we've now seen two quarters in a row where we've sequentially increased it by. I think it's closing in on around $20 million number. Got it. Thanks. And then, for the ARR growth next year, as we complete the transition in the middle of next year, is the free cash flow or the ARR growth, I guess, ramps up in the first half and then slows down because now we are ending the transition and then ARR growth will converge more with the revenue growth. How do you feel about the trajectory of the ARR growth, I guess, first half, second half next year? I think if you're asking about whether or not there'll be seasonality within the ARR growth, I think we're not guiding to ARR, you know, from quarter to quarter. You know, we continue to anticipate, you know, growing the ARR every quarter, but we're not gonna talk about guiding for every quarter here. Your next question is from Alex Henderson with Needham. Great. Thank you very much. I was hoping you could talk a little bit about the competitive landscape and not in the way that I think most people are thinking about it. There's a lot of blurring of swim lanes with people like SailPoint, Okta into your space. My sense is that that actually has resulted in an increase in demand for your products as they have stimulated awareness but not necessarily impacted the share. In fact, customers will see them come in, hear the pitch, and then realize they need the technology and therefore come to you as opposed to going with the slimmed down initial versions of their products. Are we seeing a stimulation in demand for Privileged Access as a result of the lightweight competitive entry? Thanks, Alex. I love your angle here. I think first and foremost is the increased demand environment and our increased leadership position based on merit. You know, having the better products that address all of the broad use cases in identity, definitely Privileged Access Management and expanding to identity. I do agree that there's been more publicity to the space from that perspective with announcements of entry that you know of very early products where we do not see those products in the field. Customers have heard of those pre-announcements. I don't know how much we factor that into the awareness, but the awareness is up across the board for identity security. That may be a probable contributing factor, but the biggest thing are the demand drivers and you know all of these years of focusing on the customers and focusing on being a broad platform for identity is bearing fruit for us in a very strong competitive position, the strongest I can remember. Great. Thanks. Thank you. I will now pass the call back over to Udi Mokady for closing remarks. Great. Thank you very much. 2021 was an incredible year of transformation for CyberArk, and I wanna thank our customers, partners, and our global employees for contributing to this historic year. Thank you very much. This concludes today's conference call. Thank you for participating. You may now disconnect.