My perception of the world is like skewed. Yeah. All right. So I think we're live. So welcome, everybody. Last morning's session here before lunch. Eric Heath, the Security and Data Software Analyst here at KeyBanc. Pleased to have you with us, CyberArk, and Erica, newly appointed CFO. So congrats in. Thank you. In person. Really excited for you. Appreciate that. So that's great. So maybe look, we had earnings, and it was a strong earnings for you. We had the analyst day. So maybe just starting with Q4, we'd love to maybe just get your perspective on what drove the strength, what metric, or what outcome that you saw in 4Q that was, I don't know, most notable for you. Yeah, so there were a number of things that I would point to, but I'm going to keep it to three. Got it. So the first is the success we had with Venafi right out of the gate, the fact that we were able to close the acquisition on October 1. F rom an integration and from an execution perspective, we felt like that went just as well as we expected, if not better. I think we were super excited about the opportunity there and our ability to be able to take that acquisition and really, we feel like, drive some performance or outperformance in EMEA in some larger deals that they probably wouldn't have been able to do if they had been or continued to be on a standalone basis. Related to that would be the success of secrets, right? So when you think about the whole machine identity space, which I'm sure we're going to talk a bit more about, but when you think about machine identities generally, we've been seeing for the last 18 months or so a really impressive growth rate around our secrets management business. I think in Q4 and throughout the year last year, we continued to see that momentum build, which I think when you combine that with Venafi as we roll into 2025, it has a really great setup for us. When you think about that secrets business, it really is the fact that the CISO is taking a more active role in the whole management of secrets. T hat's something that we were really excited about. T hen the third piece that I wanted to point to is the fact that we're increasingly selling those platform deals. When you think about those top three deals that we talked about that were new logos, so if you think about the last couple of years, the new logo environment, because the macro environment broadly has been challenged, we hadn't seen as many seven-figure deals. In the fourth quarter, there were four that were actually in the top 10 that were new logos that were seven-figure deals. The top three of the three deals that we signed in the quarter were actually for the full platform, and they were new logos. We were really excited about that too because it proved out our platform selling motion, but it also gave us more confidence in that new logo market and the fact that we were able to sign that number of large deals for the quarter. Yeah. That's interesting. So do you think the new logo environment is getting a little bit easier on the margin? So I think in the fourth quarter, we certainly saw an improvement in the new logo environment. I would say it's not there was no market change as if everything felt as if it opened up, but I think that as we progressed through the year, the fact that we were able to sign those bigger deals with new logos gave us more confidence. Now, the macro, as I said to you when we began the conversation here, there certainly is noise, right? From a business perspective, we feel confident. We're only two weeks out from giving our guidance. There's nothing materially has changed from when we provided guidance a couple of weeks ago, but certainly there's a lot of headlines that are out there in the news. Right. So I mean, the three things you talked about were kind of, I don't know, adjacencies. I mean, platform includes everything, but I mean, there's some of the newer products. T he core of it still seems like on fire, I guess, is my way to interpret it. So where are you still seeing the opportunities with just the core PAM market? Yeah. So I think our shift to selling solutions and the focus that we have on both the IT persona and the developer persona, I think, is really paying off. I think when you think about the basic blocking and tackling for privileged access, which is what sits in both of those personas, the threat landscape continues to keep that at the top of the priority list, right? When we think about penetration in our core base, we're still expanding. So that expand motion is really, really healthy. N ow we've also added on the fact that when those core IT people need to increasingly access cloud environments, we can do that through Zero Standing Privileges, which is our Secure Cloud Access solution, which is a different offering. Our customers were able to say, "Hey, we want to add on this new solution," or, "We want to upgrade our seat," right? "W e want to move to the enterprise edition where we'll get more of that functionality." So I think our ability to modernize PAM has really paid off. Plus, there's still so much opportunity within the core base to just expand broadly. We're still landing new logos, 85% of the new logos. We signed about 1,000 new logos last year, over 1,000 new logos last year, and 85% of them came from PAM. So you're still seeing customers start with the PAM use cases because it's an area where they have to control because it's the one control within cybersecurity that actually can stop a breach from progressing. 85% of new logos, so 850 of the 1,000, roughly speaking. Are they displacements? Are they greenfield, down market? So it's a mix. So I would say we started to see an increase in the displacement motion a couple of years ago, but the vast majority of those customers are landing with Privileged Cloud, and a lot of that would be greenfield in nature, which is surprising, right? I've been at CyberArk almost 10 years, and I think at year three, I was like, "We have to start seeing more displacements because doesn't everybody have PAM? Doesn't everybody have PAM? They don't. I t's one of those things where even within a large enterprise customer, they may create a new environment, right? They may open up a new AWS environment. They might have Delinea, or they might have a BeyondTrust, or they might have CyberArk in their on-prem estate, but they want to use CyberArk for that newer environment, which would be a greenfield opportunity because nothing is being secured in that environment with CyberArk. So when you have those complex environments, you oftentimes will have, or not often, but sometimes you will have multiple vendors in there. W e have seen an increase in some of those rip and replace in the last few years. Yeah. So on Venafi, can you just remind us the thesis on the Venafi acquisition, how this I always think of it as trying to understand the longer term 1+1=3 with secrets management and start there, and then maybe we'll come back to more machine agentic AI stuff later, but just remind us the high-level thesis on why you're excited about Venafi longer term. Yeah. I'm going to even start with the near term, and then I'll go into longer term. So when we think about the machine identity space, there is a number of dynamics that have been happening, right? First of all, there's just the sheer volume of certificates, the sheer volume of machine identities that are getting created. Now, independent of agentic AI, just AI in general is accelerating the creation of machine identities. If you're able to make a developer more efficient, that developer by nature is going to create more secrets because they're going to be developing more code. W hen you develop more code, you have more secrets. You have more certificates. You have more crypto keys. All of that, when you bring it together, creates this really great opportunity for CyberArk as it relates to the Venafi business with our secrets business because customers are struggling there. I mentioned secrets at the beginning of this conversation that it was one of the highlights of last year. When you combine that with the ability to manage the certificates for where the lion's share of Venafi's business comes today, that's something that every one of our customers, when we were having those conversations throughout 2024, was struggling with. Then when they're starting to hear the noise about Google saying that those certificates have to be rotated every 90 days, and then Apple comes out a few weeks later and says, "Those certificates have to be rotated every 45 days," that is not manageable from an Excel spreadsheet. So that, from our perspective, really creates a huge opportunity. Then when you combine that with secrets and our ability to be able to manage those and secure those non-human identities, we think we're in a really great position. P lus, also on the human side because all of those can be its privileged use cases. It gives our customers that visibility across their human and non-human estate. Yeah, and I know it's still early days, but what sort of uplift are you seeing with customers that are taking a Venafi? Yeah. So the Venafi deal sizes are actually pretty similar from an initial land perspective to what the CyberArk deal sizes from an initial land perspective are. O ne of the things that is interesting that we've been seeing is when we've been going into some of the customers, they can build into very nice average ARR in terms of a total lifetime value from the customer, right? So there's been a lot of instances where we've come in and that customer may be paying a couple thousand, $100,000 for CyberArk, but they're paying more than that on the certificate lifecycle side, which we think also gives us an opportunity in some of the other pieces of our business. W e do think that it can be equal to, if not just like secrets, equal to, if not more than a PAM opportunity when you're kind of all in. Yeah. Makes sense, and then another acquisition with Zilla recently, and I think the IGA space is quite interesting at the moment, so why now? Why was this the right time to move into IGA, and why was this the right acquisition to do it? Yeah. All really great questions. So I think if you think about why now, when we looked at our product portfolio and our platform play, IGA was an area modern IGA. So when you're thinking about the cloud workloads, we felt like that was an area where we had done some internal development, and we had also acquired a couple of companies a few years ago to give us lifecycle management and identity flows, which are governance use cases. We felt like it was an area where we really needed to bolster our capabilities in order to deliver on that vision, right? That vision of ours, which is to apply the right level of privilege controls across all identities, human and machines, given what that identity is doing. In order to execute against that vision, we felt like we needed more governance capabilities when it came to the cloud. Given that how the pace at which the change happens, embedding that into the platform, some of those capabilities, and also giving us another land spot or an expand spot was really attractive to us. That was the why. The why now is we've been looking at a number of different opportunities. Deepak, who is the founder of Zilla, is actually kind of, as Matt likes to call him, he's the Udi of IGA, right? So when you think about what he was able to do way back before SailPoint even existed, he actually was the first founder to kind of create an IGA solution in the market. Having his expertise in-house at CyberArk to help us shape and craft our vision over a longer time frame, we felt like made a lot of sense to CyberArk. They were also based in Boston, so we got to know them pretty well. A s you know, and some folks here may know, culture is really, really important to CyberArk. I think whenever you make an acquisition, having that cultural fit is one of those areas that can either kill a deal or help accelerate a deal. I t's always been important from our perspective to get that right cultural fit. W e felt like Zilla had that. Plus, the tech was pretty impressive. When you think about this coming year, 2025, I mean, two acquisitions now and now a very comprehensive portfolio. If you're selling a bigger portfolio, a bigger platform, it usually involves, I don't know, more of a C-suite sale. How are you thinking about adjustments to go-to-market to enable this broader platform sale? Yeah. So it's a great question, so I think the way we're kind of structuring the go-to-market is that we have our enterprise reps that have the full bag and are able to focus on going in and pitching or selling the entire platform story, but we've also kind of built on those speedboats that we've had previously, right? Or what we used to historically call speedboats, which are more of that specialized sales motion, and so the Zilla acquisition is actually going to go into the identity piece, the broader workforce identity piece of the puzzle, and then when you think about Venafi, we actually have a specialized sales force that will get into that depth, and that is going to be combined to a large extent with our secrets management business, so those two overlays are going to be working together hand in glove. And there's so many synergies there that we think that that training, which is now at this point complete, we should be able to benefit from. T hen from a marketing programs, something that we talked about last week at our investor day is that that CIO CISO marketing motion is something that we've also been increasing from a reach perspective because we think that that's something, an area when we sell into security teams, we've always done a really nice job of selling up into the organization. A s we go broader into the platform selling, we obviously have to increase that motion quite a bit. Yeah. So I mean, if the swim lanes are blurring, I think it's going to be one question for investors of like, "Okay, everybody has their starting point of strength. Why is PAM the right starting point of what makes you strategically have the advantage, upper hand, and consolidating the adjacencies? Yeah. It's a really great question and one that you can imagine I get every once in a while. So I think when I think about why, of course, I'm biased, but when you think about where identity sits in terms of the attack landscape, it's one of, if not the most frequently attacked vector, right? This is a security problem. This isn't an identity management problem. This isn't a governance problem. Identity is a security problem. F rom where we sit at CyberArk, we believe that the people best able to solve a security problem is a security vendor. I t's not to say that Okta isn't a really good company. They've got great technology. They really make life easier with their MFA and single sign-on. We also have MFA and single sign-on, but we are able to wrap security controls around that. When you think about what SailPoint does, really great company around governance. They've built out a wonderful technology on the governance side, particularly for their on-prem. W e think we can add some unique value when you're going into cloud environments because there's a lot of risk in the cloud. We think we, coming from PAM, are better able to address those use cases because it's one of the hardest things you have to do. Yeah. Hitting agents at a high level, we won't get too technical, and I think a lot of this is still just being figured out, and we're sorting through it still, but when we think about the portfolio, what do you think this benefits? Which part of the portfolio do you think benefits or is best aligned with the agentic opportunities? Is it Venafi? Is it secrets? Is it core PAM? So, I'm going to give you a can I take door number? Can I take the third door? You can take the third door. So we actually think it's the entire platform. So when you think about and we're not saying that you have to buy the whole platform. We're actually stay tuned. We're going to talk more about agentic. We kind of teed up some of what we're thinking about from agentic at our investor day. T he thing about real agentic AI, like when you're getting into an agent that acts like a human, it has to have human-level controls around authentication, around privileged access, around the ability to monitor and manage what those agents are doing. I t has to be done at the speed of light, right? It has to be done at the speed of a machine. When you're thinking about that combination, we think that we've got a really unique value proposition because we can take those human-like controls and we can apply them to those agents through our platform. T hen we can also take elements of secrets management and Venafi and combine that to be able to create a unique solution that will address those use cases. Now, you're right. This is still emerging. The good news is that we've had and done some pretty interesting work with Accenture to be able to validate some of what we think is going to be an appropriate level of controls around these agents. So we feel like we're in a really good position because of the work that we've already done. W e're going to talk more about it at our customer event in a couple of weeks. Yeah. Looking forward to it. Hopefully, I get an invite. Let's talk about the targets from the last week. It's all blurred at this point in time, but I think the guidance implies a bit of growth in net new ARR, which I think is a little bit different than your prior guidance. Maybe it was, I don't know, I could argue it was slightly more conservative in that sense. So why the different approach to the guidance and what gives you the confidence in that? I don't know. What seems like a little bit more optimistic in terms of net new ARR growth going forward? Yeah. So I think when you think about the guidance, I think our guidance methodology between myself and Josh is the same, right? We have not changed our approach in the way we look at the various pillars that go into our near-term guidance as well as our long-term guidance. So we look at the opportunity, we look at our ability to execute, and then we look at generally what any of the exogenous hurdles might be, like the macro environment would impact our ability to execute. So when we were talking about and contemplating the targets for 2028, one of the things that gave us confidence to put those targets forward was the fact that we really do have that broader platform and that we see really strong growth as you pointed out. The human identities are still growing. That piece of the business continues to have really healthy growth from not only a land perspective, but also expand. T hen we have this machine identity business that we have a high degree of confidence in our ability to execute against. I would even argue if you look at the pieces of the pie that we outlined for 2028, which is roughly 45% of the business coming from PAM, just over a quarter of the business coming from machines, and just under a quarter of the business coming from workforce, there probably or could be some optionality in that machine identity business because we do think it could grow faster. So I think we felt like the guidance was a nice guide for us to put out to kick off the 2028 view of the world. We feel like it just demonstrates the confidence we have in our ability to execute. So machine identity is probably something more optionality there. What about Zilla? Is much embedded in that? No, not much is embedded in that. I mean, we have some embedded in our guidance for Zilla. We kind of have, if you think about the Zilla trajectory, it's gone from $2.5 million last year to roughly $5 million at the end of this year, so more than doubled end of 2024. Our expectation is we can get it to $10 million by the end of 2024, 2025, excuse me. T hen when we look forward, we do have some conservative estimates for Zilla in that long-term guidance, but we do think that there's also optionality there. Yeah, and you also committed, right? It's a Rule of 45 each year for the next. We committed to it being a Rule of 45 company, yes. How should we think about the margin path? I think it was 22% free cash margins today, 27% in 2028. So we committed to $600 million in free cash flow for 2028. So I think the reason we wanted to anchor everyone on Rule of 45 is that if there were faster growth, we may not give you the same margin. The dollar amount. The dollar amount. We're committing to $600 million and being a Rule of 45 company. So the margin growth profile between those two might look a little bit different. We wanted to give ourselves a little bit more optionality to invest back in the business if we think we can continue to drive growth. We believe that we have the opportunity in front of us to continue to be a 20% grower, but that will take investment. So that $600 million is where we're committing to, and then where the margin falls on that Rule of 45 will be kind of a derivative. Yeah. I wanted to just ask you on the channel partnership opportunity, just where you still see some big opportunity going forward. I think MSPs is probably something that has been talked about. I don't know if we got much attention last earnings call or the analyst day, but where you see the opportunity from the channel perspective, MSPs in particular? Yeah. I think there was so much data that we gave at the investor day that some of the excitement around MSPs got lost in the noise. I think there was one statistic in there around the growth in the MSP business, which is that we're seeing really great growth there. It's off of small numbers, but I think Gartner is projecting that 30%-40% of all IT is going to be run through MSPs in the next few years. Our belief is that we're in a really good position to be able to capitalize on that. We've made some nice investments in that MSP channel. We've been seeing growth. I think the other piece that we didn't talk about in investor day or much on the earnings call was even some of the marketplaces. We think that we've got some nice opportunity there to get some leverage in the marketplaces, and we've also been making investments in the technology around product-led sales to make it easier for us to kind of go to market with something like Secure Cloud Access, which is solving a use case around those zero standing privileges that are ripe to be sold through those marketplaces. Yeah. One more I wanted to ask, but I didn't want to see if there's a question in the audience at all. On the Venafi Salesforce, did you say you were keeping them separate? So the Venafi sales force is now an overlay. So we've got the CyberArk Enterprise reps that have the Venafi solution in the bag. T hen we took the Venafi reps and we created an overlay sales force that is more of a technical support of our enterprise reps. You think Zilla is more adjacent to the core sales rep today than Venafi, correct? The IGA sales process. I actually, it's interesting because Venafi broadly is actually being bought by the same privileged buyer oftentimes. So even to the named human being that's associated with the budget. So that was one of the things that surprised me the most when we were going through diligence was how much overlap between the buying centers between Venafi and PAM there actually was. So I actually think when you think about both Zilla and Venafi, they're very complementary to the way we've been going to market. Yeah. L ast one I wanted to ask you, just because we're seeing obviously some weird pricing dynamics with not necessarily your competitors, but large security companies and flexible credits and platformizations and discounts and contract buyouts. Do you see any of that happening in the identity space in the foreseeable future as a possibility to enable adoption of the broader platform? So it's not something that we entertain and not something that we've done. I can't speak to what our competitors or peers within the identity market will do, but it's not been our approach to pricing is that you're able to sell for value, right? T hat's kind of always been our approach. When you think about privileged access, we've always sold at a price premium because we believe we give customers a heck of a lot more value because of what we're able to give them from a functionality perspective. G iving products away has never been part of our DNA, and I don't see CyberArk going down that path. Doesn't mean that some other vendors may not do that. Well, I mean, I think identity is not at the place, the maturity where it's a replacement market. I just think there's so much greenfield that's still to go. I totally agree with that. Yeah. So So all right. I think we're out of time. So I appreciate everybody sitting in and listening. Thank you so much, Erica. Of course. Thank you, Eric.