Koji Ikeda. I am one of the software analysts here at Bank of America. Welcome to day three of our tech conference. I am absolutely thrilled to be hosting GitLab for a fireside chat. We have Bill Staples, CEO, and Jessica Ross, CFO, with us today. Thanks so much for joining us. Absolutely. Hello, everyone. Thank you. Hello. I think you guys just reported results this week. It's been a busy week. I've been running around the tech conference, and so maybe even just to help me, would you recap the first quarter results, the big news coming out of it, and how we're thinking about guidance going forward? Yeah. Why don't you kick off with the numbers and I'll fill in some color. The numbers? Yeah. I know we had a very strong first quarter, very excited. We beat on both revenue and profitability. Revenue was $264 million, growing 23% year-over-year. We delivered 14.2% in NGLI margin, which was a 200-basis point increase year-over-year. Our enterprise business is strong. We are growing seats. We saw strength across all geographies, and we saw some particular strength in PubSec in AMER. We're very excited about that. A couple of other just data points. Our 100K customer cohort grew 18%. We just crossed a big milestone with GitLab Dedicated with $70 million in ARR, and overall, the business is very strong. Yeah. Maybe I'll just add a few other data points and color around leading indicators for growth. We shared this quarter we had 30% year-over-year increase in first orders, so new customers coming into the business. That's been a focus for us because we've traditionally been a land and expand business, but have never focused as a company on winning new logos per se. It's always been take what comes. Now as a billion-dollar revenue company, we've decided to specialize our sales force and have dedicated focus on first orders, as well as a product-led growth motion that we've rebooted, and that's starting to pay off. Customers tend to land small with us but grow over time. It also demonstrates our competitive position and ability to win in this very dynamic market. Second, we also shared a number of activity metrics in the platform. We're the beneficiary of all of the AI coding dynamics that are underway with Claude, Cursor, Codex, and multiple other players. All of that code that gets generated drives demand for GitLab, and while our business model currently doesn't capture that because we've always had a seat-based business model that allows engineers to use whatever coding tools they want to use GitLab to productize that code, we see the platform usage surging. Last quarter, we shared, for example, 60% growth in projects that use our security capabilities. This quarter, we shared nearly 50% increase in year-over-year in code pushes, so more code getting pushed into GitLab. Also significant growth in pipelines. Those are the things that take code and verify it, secure it, get it ready for deployment, and then push it out. We saw that go from the 20s in the last half of FY 2026, growing month-over-month now to 38% year-over-year growth in Q1. Those are all leading indicators that we're really benefiting from the AI coding work that's going on around the industry. I shared during the quarter five new architectural bets that we're making that set us up not only to deliver more value for customers but also capture that value over time. One last data point for the quarter, which is it was the first quarter that we've actually had our new agent platform product in market. This is us taking LLMs and providing agents across the software life cycle to help with all the tasks that engineers have to do to not only write the code but actually ship the code out to their customers. In our first quarter, we captured more net new ARR than any previous quarter combined across our prior two AI products. It was a very strong start. We also shared an interesting early data point around consumption because this new Agent Platform is a new pricing model that's a consumption-based model, not our seat-based model. In the first quarter, we saw a $20 million consumption run rate. That's a measure of both committed credits and on-demand credits that were built up both pre-GA and then in our first quarter of business. Felt that was a very strong start. Nothing that you should depend on in terms of $20 million on the other side. It's a run rate based on one quarter only, so we're not building it into our forecasts. We thought it was valuable to share, nonetheless. I guess maybe a couple other things. Sure. There was a lot of goodness in the quarter. We did also highlight, though, that the quarter saw some churn and contraction related to layoffs and also some unique contraction related to M&A, where you view those both as temporal, especially the M&A side unique, but without that, the quarter would've been even stronger. I think just I know you asked about guidance too, so just maybe stepping back for those newer to the story. When we gave guidance at the beginning of the year, we gave a very wide range, 15%-17%, in terms of revenue growth. There's a lot of moving parts which we'll talk about as we have this conversation. We really positioned this year as a year of investment and execution. I think the big message this quarter is that is playing out as planned. Our assumptions are playing out. This is a quarter of tighter execution, which gave us confidence to raise the guide. We've narrowed that to 16%-17% and really just, again, excited about the year ahead. Is there a metric that investors should be focusing on as the best leading indicator of the ability to not only achieve the guide but potentially beat it? Is it billings, RPO, the Duo Agent Platform, 20 million metrics. What should investors be focusing on as an indicator of health? I think we've really laid out five growth initiatives. I don't think it's one. I think with our business, it's really about us firing on all cylinders. I think that's why we're very intentional about laying out the metrics that Bill talked about. At the end of the day, though, in terms of our guide, we have a ratable revenue model, and that gives us a lot of visibility. We really focus on revenue as our forward metric that you should also be focused on as well. Okay. A couple of weeks ago, you guys announced that there might be some changes within the organization, and then you fully laid it out on Tuesday of this week. Help us understand the strategy behind it, what you think will be the benefits of it, and then how to think about headcount growth going forward. A couple of weeks ago, I published a letter. If you haven't read it's published on our website, and it's called Act Two. GitLab Act One has been an incredibly successful effort. We're now over $1 billion in revenue, growing at 23% this quarter, and we serve over 50% of the Fortune 100. Some of the largest companies and organizations around the world depend on GitLab. We're incredibly proud of what we've built and what we have. At the same time, you all see it, I'm sure, the way software engineering is happening is changing. It's changing rapidly. We sit down with our customers all the time, but this quarter in particular, we had several opportunities to have our advisory board, these are some of our largest, most strategic customers, come together in person with us and talk about the future of software engineering, where we believe it's going, and what the opportunities are for GitLab to add value and solve their problems. We came up with five architectural bets that we believe set GitLab up to benefit from the AI structural tailwinds that are happening around coding. These are investments that often relate to the scale of infrastructure that we provide, as well as the capability that we already provide for humans, but now are needed across humans and agents. I can walk through them if you're interested, the bet starts there. The Act Two starts, we realize in order to serve our customers going forward in this agentic era, we need to focus on the scale and the capability of what we do across both humans and agents. We also, as a management team, this was the first quarter since I became CEO six quarters ago now, where I've had the entire exec team together. We've gone through some executive changes since I joined. Jessica joined just a few weeks before the quarter began, as did my CTO. As an executive team, we got together, we looked at that strategy, those architectural bets, and we feel very confident and convicted that those are the right things for us to go laser focus on and execute. We also asked ourselves, though, what else do we need to change to move faster as an organization to capture this opportunity while it's right here in front of us? That led to a discussion around a restructuring and changing both the operational footprint of GitLab as well as the organizational layers and some of the culture dynamics. When we looked at the operating footprint of GitLab really came into its own amidst the COVID era. It was really unique in defining a remote-first async culture that was native to that era. The hiring strategy at one point was hire in any country where there is talent. We ended up with 60 plus different countries where we have employees, and for a company our size, that is pretty unwieldy. We had a long tail of countries where we had one, two, or three employees, and we've decided to shrink that. We reduced the number of countries by 22, and now we're smaller in that regard. We also looked at our management layers. We had eight layers of management, and we decided in order to streamline communications, prioritization, decision-making, we wanted to shrink that to five. We've done that. Third, we looked at how we execute, how we focus as an organization. Our previous core values were really centered around flexibility. Again, born in that COVID era when everyone was struggling to figure out how to do remote work and how to work from home. We decided that for the agentic era, the number one thing to focus on is speed. We're shifting from flexibility to speed with quality is our number one operating principle. Second operating principle that we've defined is ownership mindset. We want to truly empower every individual in the organization to think like an owner of the business, to be able to own decisions and execute, versus just take actions and check boxes on tasks. Third, our third operating principle is all about customer outcomes. We want every individual in the organization thinking about the reason we exist is to serve customers and deliver value to them. Everything we do, can we clearly define the customer benefit or customer outcome that that work produces? Those are the three new operating norms that we created, or operating principles. Those are the structural changes we made. When I introduced these changes to the company, we decided, given the magnitude of opportunity and the magnitude of change that we're introducing, we would explain all of that to our company transparently and also do the restructuring openly. We spent a couple of weeks with all leaders in the hierarchy to work through exactly how the reorganization would work, and we offered the opportunity for every employee to decide if they wanted to opt out of all of this change and be part of the restructuring. We felt like that was important because, again, the magnitude of change is great, and this is an opportunity to exit the restructure with an aligned, committed team, versus a team that feels like change is being thrust upon them, and then they have to go find something different if they don't like it. It's been a tough couple of weeks at the company, but I can say I think we're coming out of it much stronger as a result of the approach we took to the restructuring, and a new energy kind of infusing in the company now. Next week, we have a customer event. It's an annual customer event that we do at the start of every major release. It's in London, but it's broadcast here if you'd like to watch it. We're going to be unveiling a bunch of new innovation, including several of the architectural bets that I shared in that Act Two letter, which you're definitely going to be interested in watching if you get a chance. I recommend it. Layering on how that works from a financial impact perspective as well. Just to be clear, this restructuring was never intended to be a cost-cutting or margin exercise. This is really about aligning the organization strategically to win in this agentic era. Ultimately, with all the decisions, we ultimately reduced our workforce by about 14%, 350 of our team members. We are recognizing a restructuring charge of about $30 million-$35 million, $19 million in Q2, with the remainder through the rest of the year. We are reinvesting the intent of all of those savings in the architectural bets that Bill has outlined. We're really looking at it in three ways: people, technology, process. This is a big cultural shift for GitLab, and we are asking a lot of our Act Two team members, so we're investing in our people. Secondly, again, from a technology lens, I think Koji, you were asking about headcount strategy, especially in R&D. This is about making sure we have the right talent to really capitalize on this moment. We're probably going to be growing and investing in R&D. From a process lens, we are looking at every single workflow across the business and reconfiguring that to be AI first. Really excited about those and the opportunity ahead. With such a big change, one thing I think about is culture, maybe near-term risk, but also long-term benefit. I love the speed with quality. For any technology company, that makes a lot of sense, and especially anybody working in software development, speed with quality is paramount. As much as you can, how do you think about building culture from here going forward within the company? Yeah. One of the things that's really interesting is I've been building software for 30 years, and I've been working with software engineering teams. I came up through a product and engineering background, so I've seen a lot of software and how teams build software. Even within GitLab, it's been interesting to watch how the engineering team has evolved in accepting new ways of building software with agents. Even within GitLab, I see the full spectrum of attitudes, skill sets, and approaches, right? On the one hand, I have an engineering team that will be shipping next week at Transcend, who literally writes and delivers more code than the average of the organization by 20 times. 20 times. Yeah. They have the luxury of a brand-new service built from scratch in a modern stack using AI tools, and what they built is phenomenal. I have other teams that are struggling because they have an enormous amount of legacy code that was built over the last 10-plus years. There's technical debt there, and they're using AI. Their usage of even our own platform, GitLab Duo Agent Platform, has accelerated them two to four times faster than our historical average. That's awesome to see. I also see others in the engineering organization who feel like AI is a threat. AI is taking over their jobs, reducing the importance of skills that they've spent decades building. I understand how that can feel. At the same time, over 30 years, I've watched how the engineering practice has changed so many times that I feel like this is just another evolution of the same thing, right? We've tried to give the coaching, the encouragement, the space to adapt toward this new modern ways of engineering. To your culture question, what we're now saying is, look, we've identified what it looks like to be highly successful in agentic engineering. We have several of these teams that are going multiples faster than our historical norms. Let's snap that as the cultural icon. Let's find ways to train and enable and give tools to everyone to reach that new standard, because that's going to not only benefit you and your careers and your ability to harness the best technology to build software, but it's going to help us prove our platform, live it first as customer zero, and share with the rest of the world that depend on us how to take advantage of AI tools in this new era. That was what Act Two was about, was taking those bright spots, those early wins that are already within our organization, and setting that as the new standard for everyone. That's how we got to where we're going. GitLab Transcend next week. Be excited to tune in as much as you can tell us what should we be focusing on? I know there's a somewhat of a new pricing model you alluded to on the call, GitLab Flex. Tell us as much as you can about GitLab Flex, because I know you're going to talk about it a lot next week. Maybe I'll talk about some of the cool technology. Yeah. You can talk about Flex. Yep. Next week is going to be amazing. We're going to have incredible customers on stage, partners on stage, and do demos of a whole bunch of new innovation that we've been building out over the last quarter. I'm so excited about it. You can expect to see, for example, one of the architectural bets that's really unique to GitLab is the first part of our name is Git. It's same as GitHub, our competitor, based on an open source layer where code gets stored and version controlled. GitLab is the number one contributor to that project in the world today. The top, I think, three of the top five contributors are GitLab employees. We have decided that that scale of infrastructure that was built for humans is not going to meet the needs of agents. We believe agents are going to push it 100x beyond what it is capable of doing today. So we've joined forces with an AI lab, and we are building a new architecture and a new set of capabilities for agents for that infrastructure layer, and we'll be demoing it next week with our partner at 100x scale. It is impressive to watch. You'll see both GitLab Duo Agent Platform and Cloud Code and other external agents driving volumes of code that is impossible today. That's an exciting one. We're also going to be debuting our new GitLab Orbit service. GitLab Orbit is we take all of the data inside GitLab, everything from all of your code, obviously, but all of the connections to that code. The people who wrote it, the changes over time, the plans and bugs against it, the security scans, the builds, everything. We stitch it together into this graph. We then provide an API for agents to read that context. The reason that's so important is agents thrive on context. The better quality context you give them, the better quality outcomes they produce, and they can do it at lower cost. You'll see just how much quality and cost GitLab Orbit provides next week. There will be several other amazing demos. I don't want to steal the whole show, but those are some of the highlights to look forward to. Just on flex pricing, not much to share here. You'll have to tune in. As we're thinking about the future for our customers, it's really about providing optionality, and we're really solving for cost, value, and predictability. Flex pricing will be a contract that would allow customers to have both seats and GitLab credits. To be able to access our consumption-related products, which we'll be talking about some of those more next week, and we are really excited about this offering. We've had early conversations with customers. I think they're very excited about it. Our sales force is excited to sell it. We'll come back with more next week. Please tune in and then follow up with all the fun financial details when we get to Q2. Bill, I wanted to follow up with you on the AI lab that you mentioned. Both bullish, I want to be measured here. Anytime a company says AI lab, we could kind of get over our skis. I want to stay measured I really want to ask around, why would an AI lab want to partner with GitLab? A common bear thesis out there is an AI lab could just build the entire software development lifecycle tool chain themselves. Yeah. Sometimes non-technical people look at how powerful AI agents are and LLMs are and think, "Oh, well, they can build anything," right? Theoretically, that's true, but practically speaking it's a lot harder than it looks. As I mentioned, for this infrastructure layer where we're partnering, we are the number one contributors in the world. There's both domain expertise and historical momentum and buy-in from the community that they get by working with us. Second, we actually are the Git provider for a number of the AI startups and AI labs. In particular, this one is a customer of GitLab. It's the respectful and beneficial partnership in action, I think, as we work together because we're also a consumer of their products and services. Third, I think, as I said before, we support hundreds of thousands of organizations around the world. We have more than 50% of the Fortune 100 that use GitLab today. They see us also as a distribution channel. When we can support agents at 100x load, that's going to mean they can drive more volumes of tokens through their agents. It benefits them by partnering with us because then their agents running on our infrastructure go way faster and lead to more value for everybody. I can't believe we made it 26 minutes without talking about Duo Agent Platform or DAP that you guys always talk about it on the calls. You guys gave a $20 million metric. It's a CR consumption run rate. That's right. What exactly is in that $20 million? How do we think about it? With any time a company gives a metric, what is the expectation on the frequency of when we might hear this metric? We're very excited about this, but it is an early green shoot. Essentially what consumption run rate is it takes our committed DAP credits plus overages over 28 days and annualizes that number as a run rate. We are very excited about it. Again, this is we're a quarter in, it's data that is just a signal of product market fit. It's a signal of we're excited that the product is launched, it's doing very well. Just I think one point of clarification because on the call, there was a couple of questions about this. It doesn't include any of our prior AI products, Duo Enterprise or Duo, but it does include a small minority of conversions from those products into DAP. I think the big takeaway is that this is additive. I think the other thing that Bill highlighted at the beginning of the call is that, first quarter out, we have higher ARR from Duo Agent Platform compared to either of our prior AI products combined. Again, very excited about it and as the business evolves, we will continue to come back with metrics on a more frequent basis. Not a quarterly metric, but a milestone. A milestone metric. Okay. I think that's a great way. That's right. think about it. That's great. Yeah. Okay. How are you guys, Duo Agent Platform's been out in the market for some time with your beta customers, and it went live earlier this year? How are you going to market with it, and how should we broadly be thinking about adoption, consumption? How does it show up in the model? Yeah, we go to market, both product-led motions as well as sales-led motions. On the product-led side, we introduced $12 in premium credits for every premium seat and 24 for every ultimate customer seat, which allows engineers that are already in GitLab to begin to experiment and try the platform, without having to have their organization make a commitment. The organization does have to unlock the feature, but once they've unlocked it, there's no monetary commitment required. That is kind of the product-led growth motion. The sales-led growth motion is we have now enabled our sales force this quarter, Q1, once again, our first quarter, to go and sell Duo Agent Platform as repo side, so server side, agentic engineering across the software life cycle. That is in contrast to what Cursor or Codex do, which are more client side or developer side authoring the code, where we run on the organization or the server side where the code is stored to do all of the actions, not just coding, but all of the security, all of the planning, all of the pipeline remediation on the repo side. It's a complement. Our sales force often goes in and helps educate the customer on the use cases that we provide that are different and additive to what Claude or Cursor, whatever their tooling strategy is, and how those two can come together to accelerate the full software development lifecycle. Then there was another part of your question I'm missing around. I forgot too. Okay. In the last 30 seconds here, I wanted to ask you on security. Security offering is very good, very strong from GitLab. What is top of mind for your customers around software development and security? Yeah. You've probably seen in the news a lot of software supply chain attacks going on. Hackers or attackers are using LLMs now to discover and exploit software vulnerabilities in record time. Agents make that easy too. It is more important than ever that companies put security practices in place, not on production code, but before the code ever ships. Because once it's in production, you're exposed and the hacker's time to find that and exploit it is lower than ever. What GitLab does is we provide the real-time security scanning in the code pipeline before the code gets deployed. That's a really powerful value proposition and always has been, but even more critical today. Got it. We're all out of time. Bill, Jessica, thank you so much for doing this. We appreciate it. We'll see you soon. Thanks, Koji. Thank you. See you next week. Thanks so much. See you next week at Transcend.