Hey, good morning, everyone. Welcome to day one of the Barclays TMT Conference. My name is Saket Kalia. I cover software here at Barclays. Very happy to have with us the team from Fortinet. We've got Ken Xie, our Co-founder and Chief Executive Officer. We've also got Peter Salkowski, Head of Investor Relations. We've got about 30 minutes together. Maybe what we could do just to frame this is, we'll spend maybe 20 or 25 minutes just with some fireside chat here with the team. I'd love to make this interactive. If you have any questions, just pop up your hand. We can have a mic run around and we'd love to make best use of these guys' time. Maybe with that, Ken, Peter, thank you so much for the time. Okay. Thank you. Happy to be here. Absolutely. Quick safe harbor? Please, please do, Peter. Yes, absolutely. There it is. Look at that. It's up on the screen. You can all read that at your leisure. Please do. Quick apologies. Keith Jensen, our CFO, is home with the flu today. Won't be able to make it, unfortunately. I'm filling in for him. I'm not gonna read that completely. You can all read it at your leisure. It's up on our website, I'm sure many, many places, so we'll just turn it back to you. Oh, absolutely. Yeah. Absolutely. We wish Keith a swift recovery there. Ken, I'd love to start with you. I was wondering if we could just talk about some of the points from last quarter's results that you were particularly proud of. Pete, Peter, maybe for you, maybe you could just help us fill in some, you know, some more of the financial details just to help level set us all as we dig deeper into the business. I think, like 3, 4 area we feel we're doing quite well, much better than the other competitors. One is the SD-WAN and the OT still growing very, very strong. Mm. The SD-WAN growing like 45% year-over-year, and now probably about 15%, 16% of the business now, continue to grow very, very strong. I do believe SD-WAN market itself will keeping grow like 30% year-over-year in the next 5-10 years. At the same time, we're keeping gaining market share there, because compared to a few other competitor, whether C isco, VMware, HP, Palo Alto Networks, they all come from acquisition, and also their product also cannot integrate well with their existing product and also, kinda way behind on the function and the performance. Mm. OT also I believe will be bigger market than SD-WAN. So we have about 10% business in OT, grow 75% year-over-year. Also very, very strong growth, eventually will be much bigger market than SD-WAN. Also we started more invest in the enterprise sales. It's quite different than the strategy we have earlier days, now more focused on channel. Enterprise sales need a direct marketing, direct sales force. So we're happy, like last quarter, the enterprise sales, like a Forbes Global 2000 company, almost double year-over-year. The same time, the deal over $1 million grow 85% year-over-year, and the dollar value is more than double. You can see, a lot of bigger deal, big enterprise starting kind of, like become a focus, new growth area. Yeah. We are still have a small% come from enterprise, but I do see the momentum very, very strong, and also the pipeline also very, very strong this quarter. We feel is a pretty strong position to keeping gaining market share. That's great. Yeah. I think just to add on the, on the deals over $1 million, and we had a record quarter for deals over $5 million, which we haven't really spoke about in the past. Yeah. Just to kind of give you a sense. I think the other thing to be interesting that I think the Street was waiting for over the last several quarters is service revenue. You're starting to see service revenue growth accelerate. I think we were just over 28% this last quarter. I think our guidance for the full year implies about a 29%-ish growth for service revenue in the fourth quarter. You know, if you go back to earlier in the year, I think there was some concern that we weren't seeing the price increases showing up in services revenue. As we've been trying to point out is if you look at the change in short-term deferred, it gives you a sense of what's going to happen eventually in the service revenue because the income statement's a backward-looking number in terms of services. That's right. I think, you know, seeing that starting to show up in the income statement, I think is something that I think can give people a little more confidence. One more point, right. Right now it's the first time we called Enhanced Technology, which is not under non-FortiGate 40F sales. It's about one-third. The first time over 30%. That part grow 45% year-over-year. Mm. Will continue growing, because more come from consolidation, also the strong position in the Fabric, which all automate, integrate together. Because most product we have, we traditionally call the Fabric or Enhanced Tech, all internal develop, which give us better integration from day one, better automation from day one, compared to pretty much all the other competitor. They all come from acquisition, to build something beyond their core product. So we have all the FortiOS integrate a lot of function, but also the Fabric, semi-discretional product all designed, mostly designed internally to automate, integrate much better. Well, there's a lot of fun stuff in both those comments that I would just love to dig into, but maybe another place to dig into with you, Ken. I mean, you've been in the security industry for decades now. You know, you've seen different cycles come and go. We've had a couple healthy years of product revenue following COVID, which kind of supported the idea that there's been a refresh cycle or a catch-up cycle, whatever you wanna call it. I guess the question for you, Ken, is: Where do you think we're at in that cycle, and how do you think it looks going into 2023 from an industry perspective? I believe 2023 will go back to normal before pandemic, which the product revenue grow probably between 10%-20%. I'm not giving any forecast. Mm. It's just, since we'll be going back to a little bit more normal. Because if you look in last two years, there's a two thing driven, some product revenue growth. One thing is the supply chain issue. We somehow managed to be better than other competitors because We have own operational manufacturer, kind of, more under own control. On average, we keep about six months inventory. When the supply chain issue happened in Q2 last year, we have no problem for Q2, Q3, which also grow like a 40%, something like that. The Q4 is the first time where. We're the only security company give disclose our booking some backlog issue because majority backlog also come from the FortiGate. Now the scenes are different now. That's why starting last quarter, we feel the backlog information probably a little bit misleading or too much information because the majority of backlog more go back to the switch and routing, or AP, which is more network related, no longer is a FortiGate. The same time, the backlog no longer grows, starting flat out or even going down now. That's why I feel. If you look at overall space, they do have the traditional firewall continuing refresh every four, five years, because just like any other network device, after four, five years will be too slow. Now the security, network security try to address the market more, much more beyond security for a traditional security firewall. You really go to the WAN side, the SD-WAN, like the 5G, and also, OT security, and also go internal to the Internal Segmentation, and also go to the cloud. All this much bigger than the refresh. If you re-refresh, really not much material to us. Mm. Even could be little bit slowed down. We do see in that last recession in 2002, 2008, some customer may delay purchase of some of the traditional firewall. Because right now they address so many new issue, like we say, SD-WAN. Actually, SD-WAN cost around, I have to say about 40%-50% cost if they deploy SD-WAN today. Mm. That's also we have press release actually this morning. It's a study by Forrester. That's where for, there's a few big enterprise customer from their study, they show an ROI will be 300%. The payback period to deploy our SD-WAN solution. Eight months. Eight months. Yeah. Exactly. That's where it's a more cost saving for the customer, even during the recession. They also can consolidate a few different solution into a single box. That's really more benefit the customer, even during the recession. That we see is a huge opportunity to continue to drive the product revenue growth. Got it. Got it. I think, Zack, the interesting thing, everybody wants to try to figure out what product revenue growth is gonna be in 2023. It's been the number one question that I get repeatedly over the last several weeks. I think one of the things to think about is just the operating system. At the end of the day, one of the things that really drives our business is the ability to have multiple different capabilities built into the operating system. When we talk about things like Single-Vendor SASE, which is a press release we had about a month ago, that didn't get a lot of press, or universal Zero Trust Network Access. What we're talking about there is the ability to deliver in multiple different form factors, whether it's on-prem, in a software form factor or in the cloud, and across multiple different capabilities all built into one operating system. That gives us a lot of different growth drivers, whether it's SD-WAN or OT or Zero Trust or SASE or whatever, typical firewalling, if you will. Let's go back to the basics. The operating system is what allows us to do that. The robustness of that operating system, the fact that it's primarily been integrated and created in-house by our own R&D development group, which by the way, we have 3,000 R&D people in our company, and about two-thirds of those are software engineers writing that software, really gives us an advantage to integrate and provide a single platform across any of those different points of the attack surface and in whatever form factor the customer wants. What that does to product revenue growth in 2023 versus 2024 versus 2025, the drivers are really that operating system and its ability to provide those different capabilities. The long-term drivers, which I'm sure we'll talk about repeatedly today, is convergence and consolidation. Right. The concept that security and networking are getting closer together. The concept that companies have too many point products. They are looking. You've heard that over the last month through all of the different cybersecurity companies that have reported since, you know, their October quarters, they're all talking about consolidation, right? They're also talking about profitability and growth, which we've been talking about for years. You're hearing those same messages being repeated by others. Yeah. Absolutely. Yeah. One other interesting area is customer and also even partner starting to inquire us already the last two months, it never happened before, was the power consumption of the product. That's where starting like the last earning call, I think maybe six few weeks ago. Mm-hmm. We started also disclose every new product, what's the power consumption. We'll be able to save more than 80% energy power consumption compared to industry average, compared to other competitors. That's on the system level. In the chip level, on the FortiASIC chip, for the same secure computation compared to general purpose CPU, the FortiASIC chip can only using like 2% to 3% of power consumption. That's also lot of service provider, cloud provider like that idea a lot because the power consumption probably the biggest cost for a lot of cloud computing, for a lot of other things. That's where the technology we spend more than 20 years to develop. Eventually, what we also not only increase the performance and also can add more function at same time, it's much lower power consumption. That's starting to get pretty interesting from a lot of customers. Yeah, absolutely. I mean, if I kind of take what both of you have talked about here in terms of, you know, the OS and the power consumption, really the way that I would summarize it would be additional value for performance that you guys have consistently provided, right? Listen, given the supply chain constraints, I think industry-wide, I think, You know, I think that most firewall, if probably all firewall vendors, right, have responded to sort of those increased component costs with price increases of themselves. Now price adjustments maybe for you, Peter, can you just remind us what those pricing actions have been over the last year or so? You talked about the revenue piece. I'm curious if you can talk just about how should we think about that trickling into billings as well. Does that make sense? Yeah, I mean, we did 2 price increases in 2021. one in August, beginning of August, one in the beginning of November. Combined those we disclosed those as being in a total basis on a gross basis of 12%. we probably net somewhere in the 4, you know, 5%-5.5% net back to us in terms of those price increases. Sure. We've done 3 additional price increases in 2022, one every quarter, not as big as the first 2, but additional price increases. Basically, the reason for those price increases have been to offset cost increases, right. The expedite fees we've had to pay for getting supply, the higher transportation costs that we've had to pay to get things shipped to us quickly as opposed to sending them by boat across the ocean. Really trying to maintain our product gross margins. If you look at the numbers, I think we've kind of stuck in the low 60% range, which is kinda where product margins have been for a long time. Sure. We have been able to, so far, offset those cost increases with our price increases. The thing with the income statement, and kind of going back to my service comment earlier, is the price increases for products show up immediately, right? Right. 'Cause they're sold in period. Right. The service revenue or the services are sold as a percentage of product. The price increases are getting attached to the services. The difference is they get deferred to the balance sheet in deferred revenue before they ever show up on the income statement. You're starting to see the benefit this year, you know, certainly in the second and third quarters, you're starting to see the benefit of the price increases showing up on the services line. You can really see it if you look at the short-term deferred. If you go back to the fourth quarter of 2020, the growth in short-term deferred on a year-over-year basis was 20.5%. Seven quarters later, it's 31.7%. Right. You're seeing the price increases showing up on the short-term deferred. You should start to see that flow into the income statement at some point. Got it. Got it. You know, Ken, I'd actually love to move to the SD-WAN market, right? Because you've obviously disrupted the SD-WAN market by bumndling this with the firewall, and I think that goes back to, you know, the benefits of the OES that you called out earlier. Maybe the question for you is, how much room is left for adoption there? Are there any different approaches that you wanna take with the SD-WAN business, open-ended, in 2023, if at all? The secure SD-WAN fit our, we call it a convergence of networking and security quite well. SD-WAN actually is not the first networking function we tried. We actually, 15 years ago, we also tried secure Wi-Fi, but that time maybe when the Wi-Fi market go too quick or we're too small, so we did not make much impact. We also started to develop the secure SDN, eventually also benefit a lot of secure SD-WAN. Last we started release like 5, 6 years ago, and then quickly gaining market share because whether the competitor most come acquisition which much slower on innovation, all these things. Also we're have perfect timing to go to the market, so we're large enough, started making the impact in the space. I do believe long-term wise, SD-WAN will be replaced majority of the routing, and the same time, will be continued to, like I mentioned, grow like 30% year-over-year in the next 5 to 10 years. At the same time, it's a more fragmented market. We do believe we're keeping gaining market share. So we are knowing our probably number 2, number 3 in the space, but you can look at the number 1, number 2 or other top 5, with only one internal develop and internal integrate together. It's the same OS, same system. It's the leader in both SD-WAN market, in the network firewall market, and also, part of the SASE and other solution there. It's the integrate single solution, single-pass, single wide solution has a huge benefit to customer. That we see the huge value we can provide a customer, drive a lot of strong growth. Even like today's press release, there's a lot of customers they see the huge benefit of using the Fortinet SD-WAN. Yeah. Yeah. I think Ken made the comment there used the word in his comment there that I want to reinforce, and that is SASE, right? Gartner's definition of SASE has changed over the last 4 years since they've kind of talked about it as a definition. About 1 year ago or so, they started talking about it as a hybrid cloud solution, right? Initially, they set it up all cloud delivered, and they realized that First of all, the companies aren't ready to go all cloud. I don't think they ever will. I think it's going to be a hybrid cloud world for a really long time. Gartner changed the definition of SASE to say some of these things need to be delivered on-premise, some of these things can be delivered... CASB and WAF are cloud delivered security, they have to be delivered in the cloud. They've changed the definition again recently to be SD-WAN plus Security Service Edge. Right? SD-WAN is the delivery method for the data throughout the Security Service Edge. Owning that real estate, call it a bottleneck, if you will, we kinda look at it as the Cloud On-Ramp, right? The SD-WAN is what's delivering the data to the cloud and receiving the data back from the cloud. Owning that real estate, kinda being in that bottleneck position, gives us an advantage. We can follow the data back to the data center, out to the cloud, wherever it goes, but we're directing the traffic. We're controlling where the traffic is flowing. We think that's really important. Having an operating system that can provide all of the capabilities of the SASE solution within one operating system not only becomes attractive to enterprise customers, becomes really attractive to service providers. At the end of the day, service providers want to provide a SASE solution to their customers, but they want to provide it from one operating system. They don't want to have to go out and buy CASB and WAF from one vendor and SD-WAN from another vendor, and then all the other different components of SASE from, you know, other vendors and having to cobble it together. They want one solution. They want one operating system. Having a Single-Vendor SASE solution, which is what we're talking about, is extremely important to them. I mean, couldn't have teed it up, you know, as cleanly as that. I mean, maybe for you, Ken, I mean, you know, I mean, I think SASE has been very topical in the, in the industry. How do you think about Fortinet's SASE initiative in 2023? I mean, certainly we nearly own the SD-WAN market, certainly in the firewall. You know, what else does Fortinet need to really have a full SASE solution? And, you know, how do you make that more well-known, I guess, from a, from a marketing perspective? I put it this way, a secure service or security for a lot of service provider will continue to be one of the biggest market in the cybersecurity space. A lot of service provider, including a lot of telecom company, they are a little bit behind in the last few years... Mm. stay within the traditional firewall VPN service. They're not can go up additional service like whether the CASB, the sandboxing, some WAF, some other service. That's where traditionally like a service provider count about 30% or more of Fortinet business if you look back to 30 years ago, not 30, 10 years ago. That's where we do believe the service provider business will keep coming back, but they do need to offer additional service beyond the traditional firewall VPN. SASE is one good example. They are much broader service as a service model. For SASE itself, I feel the technology is still not quite mature enough so that they need to be more distributed. Because if you look at some SASE provider, they claim they have 100 POP worldwide. Customer have to forward their traffic to their POP being processed, and then sending back. Within their POP, they have quite a lot of different system to handle different security functions. Some do the traditional networking firewall VPN, some do like CASB, some do all this sandboxing or WAF. It's super inefficient across all these multiple box within the POP to process all the secure computing there. For us, I do believe a SASE function, just like some other traditional security service, they need to be offered in the same OS, in the same system and to be very efficient, integrate together. A lot of different SASE service, they're not well integrated, like SD-WAN, different box compared to the traditional security, compared to all the CASB, some other things, right. If you can integrate in the same OS and then use the same system, they can be more distributed and be more efficient and also reduce all the latency and better performance. That I see today's SASE using, provided by some SASE provider is not quite mature. They need to keep improving. That's where starting like a few years ago, we do promoting our own SASE should be developed in the same OS, using the same system, and will be more easily to be distributed and to be managed by the lot of service provider. Even some customer, they can manage some of themselves. That's where we continually invest in this area. Like last year, we first released FortiOS 7.0, we build in all the SASE, ZTNA. This year, we're keeping improving the 7.2 FortiOS, have all the SASE, ZTNA, all the CASB, all the things within the same OS. Some of the function already using ASIC for accelerate, some of the function not yet, still using the general purpose CPU. Give us a few more years, where we have a most function being accelerated by the ASIC, will be much better performance, low cost, at the same time, will be more easier to deploy. I think the market will continue to evolving, and I do believe long-term, the service provider, including a lot of cloud provider, like whether Microsoft or Google, whatever, they can easily jump into this market because they have the infrastructure. They own a lot of data center, lot of POP. They can easily turn this on compared with some of the SASE provider today. They have some advantage. We are more prefer to partner with this kind of bigger cloud provider telecom company. That's also, instead of competing with them for the customer, which using their infrastructure, which they have cost relation, we would rather promoting together, the solution with them and also develop a core technology which we are very, very good. Integrate OS using ASIC for accelerate and also better security service, helping them to provide service for customer. That's where we continue to invest a lot in this area, but will be more integrated and more kinda using ASIC for accelerate and eventually more leverage service provider instead of more approach ourself. We do have a lot of POP in ourself, I do feel this is not a long-term solution. Yeah. That's where leverage the infrastructure from telecom, from cloud provider will be much more efficient. Also SASE has to be more distributed and more in real time, more pushed toward the edge instead of all this kinda go to the power process and back and forth multiple system. It's kind of a need to be the architecture not mature enough. Very interesting. We've got about 7 or 8 minutes left here. I'm gonna shift to some financial questions here. Before I do that, any questions here from the audience? Peter, maybe for you, I wanna jump back to Q3 results where Ken and Keith provided a Q4 guide. It certainly came through. I think we considered a bit of macro uncertainty here. I was wondering if you could just walk us through your approach to setting that Q4 guide, you know, you know, anecdotally, right? Maybe any detail you can provide just on the macro assumptions embedded in that guide. How you thought about it, just given all the uncertainty that we have right now. Yeah. I mean, I think the change that occurred, if you look at the guidance we gave from a billings perspective for the fourth quarter, it's interesting. If you look at the guidance that we gave, pretty much every number went up in terms of revenue, margins. The only one that really changed was billings, which is a forward-looking metric. If you look back to when we gave guidance for the third quarter on the second quarter call, which would have been in August, versus the November call for the third quarter, and then giving explicit guidance for fourth quarter, the reason billings came down slightly was really concerns about macro in the sense that if you look just at our million-dollar deals, right? We just talked about how successful we were in the third quarter, 153 deals over $1 million. In the fourth quarter of last year was the first time we went over 100 deals over $1 million. Think about that. As we look at the fourth quarter, what we were seeing is, a lot of deals over $1 million, which is great, but at the same time, looking at sort of the progression of those deals through the sales cycle, they seem to be going slower than they have been in the past. Then having conversations with the sales, you know, head of sales and the sales teams, the conversation being that, you know, we're very confident in the fact that we have these transactions in play, we just don't know if they're going to close in the next 2 months, right? 'Cause to land in the fourth quarter, you get 2 months, right? From November to the end of December. We took a little bit more of a conservative approach with regards to where we think the, you know, the number of deals that will close over $1 million. That led to, I think, a 3% decline in what the billings guidance was. We went back and looked, 'cause we didn't show this on the, on the earnings call, we went back and looked after the call and said, "Well, look, how many deals are in the pipeline for over $1 million as of October 1st, right?" This sort of a snapshot that potentially could close this quarter. Mm-hmm. They all won't close, that never happens, right? Just what's in the pipeline, what's happening. Then looked back the same snapshot a year ago. If you look at just the number of deals over $1 million, the number of deals was up 50% year-over-year in terms of deals over $1 million sitting in the pipeline as of October 1st, that potentially could close. The billings on those deals are up 60% on a year-over-year basis. We're seeing the transactions. We're involved in these as, as possible deals to close, but they are getting longer scrutiny. They are more scrutiny, longer times to look at it. I think companies are just, you know... You're not gonna say, "Oh, we'll give you a 2%, 5% discount," and they'll close on you. That's not the way they operate. They'll close when they're ready to close, when the customer's ready to sign something. I think taking a more conservative approach on that is what really led us to lower our guidance. I think that's a really prudent approach and a really interesting tidbit there just on the $1 million-plus deals. I mean, Peter, just to stay with you, because, you know, it's funny, there, you know, it's always the forest and the trees, right? When you're thinking about, when you're thinking about a business included. We've talked a lot about the trees. I wanna zoom out on the forest a little bit, right? Just talk about some of the medium-term financial targets. Maybe just for the benefit of the group, can you just recap what those, some of those medium-term financial targets are? Then I've got a follow-up on the back of that here for Ken. Sure. We had an analyst day back in May. We reiterated these numbers on the earnings call in November. We said the medium-term guidance is for 2025. We're guiding to $10 billion in billings for 2025, $8 billion in revenue, at greater than or equal to average 25% non-GAAP operating margin over that period of time from 2022 to 2025, and adjusted free cash flow margin in the mid to high 30%. Those are the numbers we gave. Got it. Got it. Ken, maybe for you. I'd love to think about the profitability here. I mean, even to Peter's point, just the margin target of 25% plus through fiscal 2025. I think Fortinet's done such a great job of actually outperforming that through this time. Maybe the question for you is, how are you thinking about investing in the business and sort of balancing top-line growth with margin expansion going forward? I think we always want to keep a healthy margin. So if you were 25% above, we'll be pretty healthy margin. Also, company has been GAAP profit since the IPO 13 years ago. On the other side, if you consider the space, still rather fragmented space, we do have a lot good technology we can keep gaining market share. That's why we also need to invest in some of the growth. Like I mentioned earlier, for the enterprise sales, sometimes they take a longer sales cycle. On average, maybe take about 12 months to see some good return there. That's where we need to continue to invest. That's what compared to a few other competitors in the space. Some of them probably just more about growth, almost no profit on the CapEx. Some other maybe two profit has no growth. We want to have a little bit both, healthy margin at the same time, maintain above market growth. That's the strategy we have been doing for the last 20 years. Yeah, absolutely. Absolutely. We've just got another minute or so left here. One of the questions we're trying to ask all of our companies here at the conference is, given the all the uncertainty around macro, I'll, you know, maybe Peter, I'll direct this one to you. It's a little bit more financial. What% of your annual billings, revenue, whatever metric you wanna speak to, comes from new logo business? Can you talk about how that new business has performed in prior recessions? New business is about 10% on the quarter. I think this last quarter, we added somewhere in the range of, I think it was 6,100 new customers in the third quarter. Obviously, a lot of that's gonna be at the S&P level when you have that magnitude of new logos. Certainly some of those are gonna be on the enterprise level as well. They represent about 10% of billings. The interesting statistic, you know, from a going forward perspective, if you look at the service revenue, for example, if you look at the percentage of deferred revenue in the third quarter that came from new customers, it wouldn't even be new. Any service contract that was signed in the third quarter would have captured all of the price increases we've done over the last 5 quarters. I said earlier, we've done 5 price increases over 5 quarters. Yeah. Yeah. Only 10% of Deferred revenue that would have been signed in the third quarter, actually has all 5 price increases. Other service contracts that are sitting in deferred revenue that haven't come into the income statement, either have 4, 3, 2, 1, or could have no price increases in it yet because it takes, you know, our average contract length is 2 and a half years, basically. Right. We have contracts still sitting in deferred revenue that don't have any price increases in them. As they come up for renewal over the next year and a half, they'll have to catch up to those price increases. That alone should help drive our service revenue on a going forward basis. The point is, to your question, about 10% is from new logos, and so that's kind of what's represented in the deferred revenue. Got it. Last question. We got one in email just through the webcast. And maybe Ken, I'll direct this to you. You know, particularly some of the companies that have reported in the last week or two have kind of called out weakness in small medium business or softness in small medium business. Any comments that you've got just on the health of small medium business reporting them? The small, medium business do have a pretty small percentage, have a network security solution there. Goes through our channel partner, we still see pretty strong demand in there. Especially right now, a lot of ransomware starting target some small medium business now. Right. Before it's more bigger co-company, now they're all going down. That we see, there's a pretty strong demand in that area. Understood. I think Gwen just last comment on that, 'cause that certainly has come up in. For sure. ... the last couple of weeks here with some of the companies reporting. We have a very diversified business model, right? 50% of our billings come from 100 countries, not one of which is 3% of billings. A lot of that's being handled by the channel, right? We have a very diversified business model by customer segment, right? A third large, a third mid, and a third small enterprises. I think, by the way, on the SMB 1, keep in mind, we define SMB as companies at or below $50 million in revenue. It's a pretty big company. We're not talking the mom and pop shop in terms of that. We do think there's a lot of opportunity still in the SMB business. We provide a greater value to our customers than our competition does, and we really leverage the channel to do a lot of that. All right. Couldn't think of a better place to end, guys. Ken, Peter, thank you so much for your time. Thank you. Thank you very good. Thanks, Ken.