Hello, and welcome to Netskope First Quarter 2027 Financial Results conference call. At this time, all participants are in listen only mode. After the speaker's presentation, there will be a question-and-answer session. To ask the question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. I would now like to hand the conference over to Michelle Spolver. You may begin. Good afternoon, and thank you for joining us today. With me on the call are Netskope CEO and Co-Founder, Sanjay Beri, and CFO, Drew Del Matto. The press release announcing our financial results for the first quarter of fiscal 2027 was issued earlier today and is posted to our investor relations website at investors.netskope.com along with the supplemental presentation. Before we begin, let me remind everyone that certain statements we make on today's call are forward-looking, including statements related to our guidance for the second quarter and full 2027 fiscal year, market opportunity, growth prospects, sales ramping, competitive position, impact of AI, and demand for AI security. These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated by these statements. Additionally, these statements apply only as of today, and we undertake no obligation to update them in the future. For a detailed description of risks and uncertainties, please refer to our SEC filings as well as our earnings press release. Finally, unless otherwise noted, all financial metrics we discuss on this call, other than revenue, will be on an adjusted non-GAAP basis. We will have provided reconciliations of these non-GAAP financial measures against the most directly comparable GAAP financial measures in our earnings press release. Now, let me turn the call over to Sanjay to discuss our business momentum and highlights for our Q1's financial performance. Thanks, Michelle. Welcome, everybody, and thank you for joining us to discuss Netskope's First Quarter of Fiscal 2027 Results. Our results demonstrate that as customers are continuing their digital and AI transformations, moving to leverage AI in the cloud, and readying themselves for the reality of a large amount of autonomous AI agents in their environments, Netskope is a mission-critical innovative partner for now and the future. As customers look to solve these challenges, they understand that not all solutions are created equal, and that legacy network and security products cannot fulfill today's modern requirements. With an exploding amount of data and a vastly widening attack surface, businesses are faced with a trade-off between security and network performance that has seemed inevitable in the past. With Netskope as their trusted partner, they no longer have to make that trade-off. Our ability to deliver best-in-class networking, security, analytics, and AI with the unified common code base of our Netskope One platform built for the cloud and AI era, and our high-performance NewEdge private cloud is what differentiates us. It is why customers are choosing Netskope across SSE, SASE, AI security, and more, and sets us up well for our massive $336 billion market opportunity. I'll delve more into that in a bit, but let me first share a few highlights from our first quarter. We ended Q1 with ARR of $845 million, up 29% year-over-year, and our net new ARR of $34 million. Revenue grew 28% year-over-year to $202 million, ahead of our guidance. Our operating margin improved four percentage points year-over-year to -14%, also ahead of our guidance and a reflection of our continued commitment to drive leverage in our model. Beyond the headline financial results, several operating metrics stood out. First, we had an exceptionally strong quarter with the ARR from new logos, which in Q1 grew approximately 60% versus new logo ARR in Q1 last year, reflecting our continued success in landing larger deals and selling the breadth of our Netskope One platform. In addition to our success with new customers, we are also keeping existing ones very happy and partnering to chart their course to safe AI enablement and transformation. We have consistently operated with gross retention rates above the mid-nineties, and our GRR continues to improve, with Q1 representing the highest in our company history. Finally, we continue to see broadening platform adoption by customers. The number of customers spending more than $100,000 in ARR grew 23% year-over-year. 57% of our customers are now using four or more Netskope One products, up from 49% a year ago. On the execution front, we're continuing to hire sales reps and scale our go-to-market engine to capitalize on the significant opportunity ahead of us. Today, approximately half of our reps are either newly hired or still ramping. I'm genuinely excited about the talent and energy this team brings. It's also worth noting that we're lapping a particularly strong Q1 upsell quarter last year, which included several outside seven-figure upsell deals that set a very high upsell bar for comparison. We expect the increase in our number of reps to be a meaningful driver of growth in the back half of the year as they continue to mature and hit their stride. I'm pleased with what our team accomplished in the first quarter. I believe we're very well positioned to build on this momentum through fiscal 2027 and beyond. T he underlying demand for our business and platform's unique ability to address customers' modern security, cloud, and AI needs is strong and growing. I now want to spend some time addressing the favorable industry tailwinds of a widening AI security gap and growing attack surface that are driving durable demand for Netskope, how we are uniquely solving problems for our customers, and how our innovation engine is revving at historic rates to extend our technology advantages and leadership. During the past few months, I've had countless discussions with CIOs and CISOs, including nearly 100 at RSA alone. A constant in every conversation is safely and compliantly adopting AI at enterprise scale. They're excited about AI's potential to dramatically improve productivity and efficiency. At the same time, they recognize that attackers now have access to the same technologies and can exploit vulnerabilities at unprecedented speed and scale. We are already starting to see adversaries leverage AI to exploit vulnerabilities, showing that the barrier to entry for attackers has largely disappeared. This makes defense in depth more critical than ever before. Every agent must be treated with least privilege principles under the concept of Zero Trust, and companies should apply data, threat, and moderation guardrails for employees for safe AI usage and data protection. The average Global 2000 company tracked in Netskope's AI Index uses over 140 AI applications. Our AI Index also shows that approximately 90% of AI usage is led by business units, not IT. As a result, most of this activity occurs through shadow AI outside traditional governance controls. At the same time, AI is becoming a massive data generation engine. Netskope research indicates that for every gigabyte of data shared with AI tools, organizations may consume more than four gigabytes of AI-generated content in return. With context and data as the most valuable commodity in today's digital world, generative and a gentic AI becomes not just a technology challenge, but a complex security imperative that spans data, identity, real-time traffic, and governance. Organizations are facing a fast-widening gap between the speed of AI adoption and the security architecture needed to adopt it securely. This is precisely what Netskope was built for. From inception, we architected Netskope as an AI-native platform designed to understand the modern language and context of the internet, including API and JSON traffic, which is also the language of AI. As a result, while legacy vendors rely heavily on out-of-band inspection and post-event analysis, we understand the semantic context and intent behind them, enabling customers to apply granular dynamic policy controls without compromising user or agent experience or performance. Our platform intelligence has been forged over more than 10 years of processing real-world traffic across AI, web, cloud, private applications, and more, understanding it not just at the network layer, but at the deepest level of content and context, including APIs, data payloads, and behavioral patterns. The aggregate anonymized insights and data derived from that experience are embedded throughout our platform and represent a significant and compounding proprietary advantage that we believe is very difficult for existing or any new entrants to replicate. Our Netskope One platform unifies more than 25 security, networking, analytics, and AI products through one engine, one console, one network, and one code base. Underpinning all of this is our NewEdge private cloud, which runs Netskope's full stack of products at high speed and resilience with dynamic orchestration in our more than 120 data centers. With NewEdge, we also deliver globally distributed and highly regulated customers the data sovereignty and regulatory compliance that they require. Importantly, the same architecture that differentiates us in SSE and SASE also distinctly positions us in AI security. We've talked about being the secure and fast on-ramp for everything enterprises access today. While that nature of that traffic is changing and the volume is growing exponentially, the highway it uses is the same, and no one understands that flow of traffic at a deeper level than Netskope does. In today's enterprises, AI-powered assistants connect enterprise systems through a range of pathways, from APIs and CLIs to Model Context Protocol, or MCP, which has quickly become the dominant standard for agent integrations. As enterprises move deeper into Agentic AI adoption, the need for independent, real-time, granular security enforcement becomes even more critical, and the opportunity for Netskope becomes even more compelling. The frontier model releases we've seen, including Anthropic's Mythos and OpenAI's GPT-5.5, are genuine inflection points for the industry and will deliver real and important progress in upstream software, operating systems, browsers, and critical open-source libraries. However, they do not touch the vector that is already active inside environments now. The data flowing through AI agents, cloud applications, and enterprise workflows that authenticate as your users, operate at the privilege level of your people, and move sensitive information to destinations your security team has never reviewed. The security industry has spent years evolving security and network architectures to assume breach for human users, but that same rigor has not been applied to the AI agents now operating inside organizations. Our Netskope One platform is optimally positioned to solve this problem because of both where we sit and what we can see. Most security and networking systems see that a connection is happening. Our NewEdge infrastructure sees what's deep inside it and brings deep context to it. All this is backed by Netskope AI Labs, which develops more than 190 domain-specific models deployed throughout our products, applied where they can make the greatest difference across data protection, threat defense, AI security, and more. The pace of agentic AI adoption makes our role more essential every quarter. Every transaction, regardless of whether it originates from a person, a device, or an AI agent, needs to be inspected, governed, and controlled in real time at the point where it happens. This is what we do across trillions of transactions for enterprises around the world. At Netskope, we've always believed defense is never about one layer, and the most important layer is the one closest to the data. Our Netskope Threat Labs data shows that the median enterprise is now running 60 distinct AI apps, and power users are interacting with more than 500. Sensitive data is flowing in and out at a pace and scale most security teams simply cannot see. That data and real-time transaction problem, one where context matters, is growing more urgent by the day as AI adoption accelerates. The depth of our AI ecosystem involvement reflects how central Netskope has become to how the industry is responding to this moment. We have joined Anthropic's Project Glasswing, in which we will use our access to Claude Mythos Preview to identify vulnerabilities and harden our own defenses for our customers. In addition, we'll share our findings with the Glasswing Coalition and the security community. Our technology collaboration with Anthropic also includes integration with the Claude Compliance API, connecting our unified data governance and compliance controls directly to Claude usage, giving shared customers real-time visibility, policy enforcement, and data security across their Claude deployments. Additionally, we're also a member of OpenAI's Data Program, using GPT-5.5 with trusted access for cyber, recognizing us alongside a select group of security vendors as a trusted defender of critical enterprise infrastructure for the AI era. In addition, we partnered with Google and introduced AI Guardrails powered by Google Cloud TPUs and Vertex AI, enabling enterprises to deploy high-performance generative AI and agentic workflows with inline safety checks and local data processing at scale. Our AI Guardrails solution is also natively optimized to run on NVIDIA GPUs. With Netskope products available on the AWS, Azure, and the Google Cloud marketplaces, wherever enterprises are building and running their AI workloads, Netskope is the security layer they can reach for. Now, let's dive deeper into our own rapidly developing AI security product suite. The combination of network reach, deep context, and content intelligence, and the ability to take dynamic action at the moment of risk, is what allows us to detect sensitive data moving towards models or unauthorized agents, and stop it without slowing down valid users or agents performing valid actions or disrupting their workflows. This allows our customers to move beyond blunt block or allow decisions and instead give their organizations the confidence to embrace AI fully, what we call the AI Fast Lane. Last quarter, we announced the first four products of our AI security suite, all built on and extending the Netskope One Platform. Our Agentic Broker provides visibility and control over all MCP transactions. AI Guardrails defends against AI-specific threats like prompt injection and jailbreaking. AI Gateway inspects and enforces policies across AI applications and LLMs. These products are priced per transaction, meaning each prompt and its response, making them straightforward to deploy and scale. The market response has been immediate. These new AI security products generated significant excitement and early pipeline right out of the gate, translating into some initial early deals closed with beta customers. Among these early wins was a U.S. fintech customer that expanded to purchase our full suite of AI security products, AI Gateway, AI Guardrails, Agentic Broker, and Red Teaming, to solve the issue of legacy proxies lacking visibility, context, and control into AI traffic flows. We also expanded with a large U.S. bank who was an early beta customer of the AI security products and deployed Netskope AI Guardrails for real-time visibility and control, DLP enforcement, user behavior analytics, and inline threat protection to prevent exposure of sensitive financial information, enabling them to safely adopt AI and meet strict regulatory and compliance requirements. While still early from a financial standpoint, since these solutions were just released this past quarter, we're extremely encouraged by customer engagement and response and the growth in our AI security product pipeline, which is the fastest we have seen for any new product category in our history. We've continued and will continue to innovate and broaden our AI solutions. Earlier this week, we announced the release of our AI Command Center, which brings end-to-end operational intelligence that broadens and unifies how customers discover AI, manage its risk, and autonomously remediate issues across the entire enterprise AI ecosystem. Our AI Command Center does three things. First, it provides complete visibility across an organization's entire AI footprint. AI lives and communicates on endpoints, networks, clouds, the internet, and private infrastructure, is embedded in servers, consumed through third-party services, and woven throughout supply chains, making visibility a complex challenge. Our enhanced discovery capabilities extend visibility across our customers' entire AI landscape, capturing managed tools and shadow AI alike to identify AI operating inside and outside your security program. It helps customers gain a real-time connected view of risk. Discovery alone does not tell you where risk lives. Netskope's AI Command Center unifies AI assets, data flows, and model connections across an enterprise into a single real-time view, giving security leaders the context to understand not just what AI exists in their environments, but how it behaves, what data it touches, and where exposure is greatest. Third, it guides customers to act on risks. Identified risks are automatically prioritized by recommending contextual policy optimizations and providing remediation workflows to mitigate or remediate the identified risks. For security teams struggling to keep up with the speed at which AI can introduce risk to tools and data, this represents a fundamental shift from reactive tactical firefighting to preemptive policy-driven autonomous operations. We also recently unveiled AgentSkope, an architectural foundation built into our Netskope One platform that allows organizations to deploy AI agents capable of running end-to-end security and networking workflows autonomously. To assist SecOps and NetOps teams bogged down by capacity constraints, complexity, and manual triage. In our recent release announcing AgentSkope, Anthropic's head of cybersecurity products was quoted saying that Netskope AgentSkope brings the platform data and SecOps expertise to apply it across security workflows. AgentSkope is a strong example of how the two can help teams keep pace with today's threats. The first of six AgentSkope agents we released is a DLP AISecOps agent, which evaluates millions of alerts and potential violations to find the needles in the haystack and bring forward a small set of meaningful contextualized risks in the system to the customer. It can then agentically triage, investigate, and drive remediation actions to dramatically reduce mean time to resolution for risks. During our beta trials, a global consulting firm that was generating over 14 million alerts and 2 million incidents per day was able to contextualize all that data into approximately 100 actionable cases for human review using the Netskope DLP AISecOps agent, dramatically improving operational efficiency. We also introduced five more Netskope agents, including agents for digital user experience troubleshooting and insights, which distills millions of telemetry data points, including from the NewEdge network, into a clear view of digital health to proactively surface critical incidents, performance bottlenecks, and macro trends before they can impact workforce productivity. In addition, an agent for accelerating Zero Trust migration and auditing, and a supply chain risk assessment agent for SaaS and AI apps. Finally, as data sovereignty becomes increasingly critical in the AI era, Netskope continues to enhance our NewEdge private cloud. We enable organizations to enforce local data processing for any type of traffic and entity generating it. Customers can define geo-based policies to control exactly where their security networking processing occurs, giving them increased sovereignty over their data wherever it flows. Through our NewEdge network spanning more than 120 data centers across every major region in the world, no other platform can match this combination of global reach and granular control. I talked a bit about the growing number of customers adopting Netskope's differentiated Netskope One unified platform. Let me share a few Q1 wins across some common use cases. During the quarter, we landed a seven-figure network and security modernization deal with a Fortune 500 U.S. financial services company that showcased the breadth of our Netskope One security networking, analytics, and AI platform. The customer purchased 15 Netskope products. The deciding factor for this competitive win was our ability to provide a modern platform with robust DLP controls that could be applied to multiple channels: endpoint, email, internet, cloud, data at rest and motion, as well as visibility into and control of AI usage. We also landed a leading utility company in Latin America that will use Netskope to modernize their infrastructure, enable secure and flexible remote access, improve data visibility and control, and enable Zero Trust at scale. In a competitive displacement deal, they chose Netskope over several other competitors for our unmatched depth and breadth of data protection across their expansive environment, which was key for meeting local data privacy laws. A leading telecom and managed service provider in APJ chose Netskope for a large SASE branch modernization project. This customer purchased Netskope's SD-WAN appliances and SSE products for deployment in over 5,000 managed sites for hundreds of customers who will migrate away from legacy SD-WAN and firewall solutions onto Netskope's advanced SASE offering. We won this deal over several competitors for our ability to deliver both advanced SD-WAN and SSE. Finally, a large manufacturer chose Netskope to modernize its infrastructure, protect against advanced threats, prevent data loss, improve visibility into and control of AI usage, and address security needs globally. In a competitive bake-off, Netskope outperformed two direct competitors for this deal, which included our full SSE suite, endpoint DLP, Enterprise Browser, Digital Experience Management, and Remote Browser Isolation products. These and many other wins demonstrate our customers are gravitating towards Netskope for our ability to modernize their security and networking infrastructure, eliminate the burden of disjointed legacy and first-generation cloud security solutions, consolidate vendors onto a unified platform, and migrate to our high-performance private cloud as they adopt more AI and cloud. This also applies to our growing ecosystem of telcos and MSP partners who are using Netskope products as the foundation for a variety of managed security service offerings for thousands of businesses around the world. In Q1, for example, we expanded our alliance with Deloitte to include a managed SASE service for enterprise customers seeking to transform their infrastructure, modernize security and networking, and drive secure AI adoption. As AI transforms every industry and operating model, we also are transforming how Netskope itself operates. When we founded the company, we architected our platform to be AI native. Today, we're applying that same philosophy internally, particularly in R&D. AI is accelerating how we work across the entire development life cycle, from how we identify customer needs and prioritize roadmap to how we architect, develop, test, and iterate on solutions. Projects that historically required large teams and extended timelines can now move significantly faster, allowing us to respond to customer needs more rapidly and bring platform-expanding products to market at a pace that would not have been possible before. To put this into context, historically, Netskope launched two to three major products annually. Less than halfway through this year, we've already delivered more than double that pace. This is what it means to be a truly AI-native company, not just building for the AI era, but running in it. In closing, I want to leave you with a few takeaways. First, the durable tailwinds of digitization, the move to cloud, and the transformational impact of AI mean customers no longer have the option of compromising on security or performance. Every entity generating traffic, users, devices, and AI agents, needs to be governed and protected in real time wherever they are. They are turning to Netskope to relieve them of that burden, and we are uniquely built to do it. The AI ecosystem we have built, including Anthropic, AWS, Google Cloud, Microsoft, OpenAI, and more, reflects how central Netskope has become to enterprises safely adopting AI. That trust is not easily replicated. Our NewE dge network and data sovereignty capabilities give us a structural and global advantage that is increasingly a requirement in the AI era, not a nice-to-have. Lastly, we're well on our way to scaling our go-to-market organization to capitalize on the massive opportunity the AI super cycle has created. Our hiring is tracking according to plan, we expect productivity to ramp and deliver further benefit from these investments in the second half of the year. We are very encouraged by our strong pace of innovation and the excitement building around our platform expansion and new AI security products. The plumbing of the AI era is being laid right now. Our strategy's built for the long haul, and as the market catches up to the reality of the AI super cycle, Netskope is primed to be the foundation they stand on. We are only just getting started on our journey, not just as a public company, but in building what we believe can be a legendary company. Before I turn the call over to Drew, I'd like to share an update regarding our long-term succession planning. As we announced today, Drew, working closely with me and the rest of our board, has announced his intention to retire following more than seven years with Netskope. I want to thank Drew for his partnership, leadership, and many contributions. During his tenure, he has played a critical role in helping us scale to where we are today, including leading the company through its recent IPO, strengthening our financial and strategic foundation, and building a world-class finance organization. We will be initiating a formal search for an exceptional financial leader to help guide our next phase of growth. Importantly, Drew remains fully committed to Netskope and will continue serving as Chief Financial Officer through the search process and hiring of his eventual successor, and will transition to an advisory role for Netskope thereafter. This planned transition does not change our strategy, our priorities, or our confidence in the opportunities ahead. I look forward to continuing to partner closely with him over the months ahead. With that, let me now turn the call over to Drew. Thank you, Sanjay. Hello, everyone. As Sanjay shared, Netskope had a strong first quarter to start our new fiscal year. Underlying demand for our business remains healthy. Our platform continues to gain momentum, and our sales reps are ramping as we innovate at a rapid pace. Before I share more about our Q1 results, let me remind you that all financial comparisons are on both a year-over-year and non-GAAP basis, unless stated otherwise. Moving on to the Q1 results. ARR grew 29% to $845 million at the end of Q1. Importantly, we saw strong ARR growth from new logos, which increased 59% year-over-year. Net new ARR was $34 million compared to $39 million in Q1 of last year. As Sanjay mentioned, we faced a tough year-over-year comparison with Q1 2026 benefiting from multiple seven-figure expansion deals that drove outsized net new ARR growth of 79% year-over-year. Q1 revenue grew 28% to $201.6 million ahead of our guidance. We experienced strength across geographies. In Q1, revenue in the Americas grew 27%, EMEA grew 31%, and APJ grew 25%. Our Q1 net retention rate, or NRR, was 113%. Remaining performance obligations, or RPO, grew 33% year-over-year to over $1.2 billion, with contracted future billings growing 71%. Moving on to our customer metrics. The number of customers generating more than $100,000 in ARR in Q1 grew 23% year-over-year to 1,600. Enterprise and large enterprise customers are our focus, and more than 85% of our ARR comes from $100,000-plus ARR customers. This is indicative of our success in both securing significant new enterprise deployments and expanding in our existing installed base. Adoption of our Netskope One platform continues to increase. At the end of Q1, 57% of our customers were using four or more products versus 49% a year ago, and 28% were using six or more products, up from 23% a year ago. We're pleased with this progress and believe our broad platform of more than 25 products gives us a clear opportunity to land both larger deals and continually expand with our growing customer base. Moving on to the rest of the income statement, where we continued to see the benefits of Netskope being built to scale. Gross margin was 77%, an increase of approximately three percentage points from Q1 of last year as our NewEdge architecture continues to deliver scale economies. Q1 operating expenses totaled $184 million, improving four percentage points year over year to - 14%. R&D expenses improved about 300 basis points year over year to 37% of revenue as we continue to unlock the structural leverage and velocity of our unified common code fabric. Sales and marketing expenses increased as a percent of revenue as we continued to invest in quota-carrying sales reps. Our consistent improvement in gross margin and operating margin reflect the leverage we've unlocked as our strategic investments in infrastructure and talent begin to compound. Net loss per share was $0.06 using 400 million weighted average shares outstanding. Fully diluted share count using the treasury stock method was approximately 508 million shares as of April 30th, 2026. Free cash flow was - $57 million, in line with our guidance, as we continue to transition customers with multi-year contracts to annual billing. More on that in a moment. Finally, we ended the first quarter with $1.1 billion in cash equivalents, and marketable securities. Before I share the details of our guidance for the second quarter and fiscal year 2027, here are a few modeling points and assumptions underlying our outlook. As Sanjay noted, we continue to ramp many sales reps into the second half of this fiscal year, impacting our year-over-year Q2 comparison. We expect to return to more historical ARR growth trends in fiscal 2027, with a larger portion of our net new ARR to come in the second half of the year. Additionally, the transition to annual billings I referenced earlier continues to progress faster than we initially expected, which shifts cash collections into later periods and creates predictable future cash flows. We expect Q1 free cash flow was the low-water mark of that transition, with an improvement in Q2 relative to Q1, and a return to positive quarterly free cash flow in the back half of the year. For the full year, we still expect to have positive free cash flow margin of 2%-4%. The benefit of the transition is illustrated in the future collections visibility of our 71% growth in contracted future billings. We've highlighted these modeling points in the appendix of our investor presentation. As our results show, we continue to be focused on driving efficiencies across Netskope. We remain committed to delivering leverage in our model, while at the same time, investing for future growth. Our disciplined, high-impact, and high ROI investments position us as a significant beneficiary of the AI super cycle. At the same time, we are early in the year, and as discussed, still have a large portion of our sales reps ramping. Let me now provide our guidance for Q2 and updated outlook for the full fiscal 2027. As a reminder, these numbers are all non-GAAP unless stated otherwise. For Q2 fiscal 2027, we expect revenue in the range of $213 million-$215 million, representing growth of approximately 25% at the midpoint. Operating margin of approximately - 14% to -15%, and net loss per share of $0.06 to $0.07, using approximately 410 million weighted average common shares outstanding. Moving on to our updated guidance for the full year fiscal 2027, we now expect revenue in the range of $879 million-$883 million, representing growth of approximately 24% at the midpoint. We are pleased to be able to raise our full-year revenue guidance by more than our revenue beat in Q1. This reflects the confidence in our business and durability of demand. Gross margin of approximately 77%, operating margin of approximately - 9.5% to -10%, net loss per share of $0.18 using approximately 415 million weighted average common shares outstanding, and positive free cash flow margin in the range of 2%-4%. In closing, I'd like to briefly comment on today's announcement. It has been one of the great privileges of my 40-year career to be part of Netskope's journey over the past seven years, helping scale the company from approximately $70 million of ARR to where we are today. I want to thank Sanjay for his confidence, partnership, and friendship, as well as our employees, board, customers, partners, investors, and analysts for their support throughout this journey. I remain fully committed to Netskope and will continue to serving as CFO throughout this transition to help ensure a seamless handoff to my successor. Finally, demand for the Netskope One platform remains strong. Momentum across the business continues to build, and our pace of innovation remains high. I have never been more confident in Netskope's future or its ability to help define the future of cybersecurity. With that, operator, let's open the line for questions. Thank you. Ladies and gentlemen, as a reminder to ask the question, please press star one one on your telephone, then wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Brad Zelnick with Deutsche Bank. Your line is open. Great. Thank you so much for taking the question. Drew, congrats on your retirement. It's been a wild run. I feel like we know each other, it's nearly 20 years. I know you're committed until you hit the golf course more regularly. Again, wonderful run. Thank you very much, Brad. You got it. Listen, Sanjay, Netskope's technology is super well-regarded by every practitioner we speak to, and as you say, you're uniquely positioned for the AI super cycle, but how can you be confident of your product market fit in the AI era and that SSE isn't commoditizing, as we're seeing AI companies literally add tens of billions of dollars in run rate revenue in Q1 alone, and your net new ARR. Appreciate that you're up against a tough comp, but even on just a whole dollar basis, it's the lowest dollar amount in nearly two years, despite your sales and marketing spend up nearly 50% or so over that time. Yeah. Great question. A couple of things. If you look at our AI security products, we actually just released those last quarter. We just released today or just earlier this week, our AI Command Center. We view the AI super cycle and securing it in its infancy. Often security catches up from the perspective of AI adoption, and that's why we're so excited about it. For us, we have an over 80% win rate when we get to POV. That hasn't changed. For us, when customers try our technology, they love it. We have the highest GRR we've ever had in our history. We grew new logos by close to 60% year-over-year. For us, new logos are great. Our customers are happy. They want more from us, and from a product perspective, and that's what we've given them. That's why we mentioned with over half of our reps ramping, and we'll see that in the second half where those products hit stride and our reps hit stride. Really what we're seeing is that net new acceleration, net new ARR acceleration will happen in that second half. Thank you. That's really helpful. Maybe just a quick follow-up for Drew. Drew, how are you feeling about the full year ARR plan, relative to 90 or so days ago, and any hints that you can share around seasonality would be great. Thanks again. Yeah. The way the rep ramping aligns with the product announcements, again, we announced five new products since the beginning of the year, all AI. We're seeing nice demand build for those. I think Sanjay just said we expect to see net new ARR acceleration in the second half. Look, we guided up on revenue by the revenue beat in Q1 plus about the same amount for the year. We still expect ARR to be within a point of revenue growth. ARR growth to be within a point of revenue growth. Perfect. Thanks again. Thank you. Our next question comes from the line of Meta Marshall with Morgan Stanley. Your line is open. Great, thanks. Maybe building on that question, just I would imagine with the five new modules that have come out earlier in the year, that you're seeing good adoption there. Can you just speak to adoption trends of the other portions of the portfolio, and any trends that you're seeing there? As a second question, just are those kind of modules easier for reps to sell or just the packages that the reps are having the most success within selling? Thanks. Yeah. Great question. First of all, from the AI security perspective, we released those products just this last quarter. We've never seen a product pipeline grow like it has for the AI security products. Every conversation I'm in, within six minutes, they want to talk about that. Obviously, that's why we're very energized and enthused about the pivotal role we'll play in the AI super cycle. The proof is in that growth that we see both in pipeline and then also even the early adoption from our beta customers. One of the large financials adopting those products. Now, when you look at the other product areas for us, you see that the average customer now has over four products, and that continually marches upwards every year. That comes from those other products. Since we just released the AI security ones. Our Next Gen Secure Web Gateway product with our unified data protection, our ZTNA product, for example, our Digital Experience Management product. We gave an example in the earnings call of our win on the Enterprise Browser side. All of these really for us are One platform, and that's what's unique about us. All of our growth is organic. If you look at our products, they run on the same console, same network. It's the same. We don't ask people to have three consoles and three networks. What does that mean? It's the answer to your question. It is very easy for us and our customers to adopt new products for us because when they buy one or two, they don't have to move to a different framework for policies or our graphical user interface or our network. We want to make it operationally easier. These new AI security products, they run on the same platform. They were organically built, and as a result, they'll be easy for people to operate. Great. Thanks. Thank you. Our next question comes from the line of Matt Hedberg with RBC Capital Markets. Your line is open. Hey, guys. This is Simran on for Matt Hedberg. Thanks for taking our question. I guess to start, could you double-click a bit on the competitive landscape and how you're thinking about these new products from a pricing perspective? Yeah, it's a great question. First of all the new AI security products are priced by transaction. A transaction is like a prompt and a response. If you look at the product we announced this week, the AI Command Center, in a similar framework. It's really based on the number of agents you have, and beyond. For us, pricing in the way that people consume things, that's been our philosophy. If you look at AgentSkope and our AI agents, which is a whole separate product line that we just announced as well, which is our first AI agents. It's outcome-based pricing, which is, if you look at our DLP AISecOps agents, how is it priced? It's priced by the outcome, the value, right? How many incidents and cases do we solve? That's the pricing model. I think that is the pricing model for the future for new products, and that's what we have adopted. In addition to that, you mentioned that from a competitive perspective, our win rates from POV, POC are over 80%. Our whole focus, and that includes across all our products. Really for us, it's just continuing that march of getting those 50% of our sales reps, which are ramping, getting them ramped, expanding the partnerships like we announced by expanding the Deloitte partnership from a SASE perspective and our managed service partnerships. We know that when a customer tests and tries, and they see our AI security and our Command Center products, we'll maintain those win rates. For us, the focus is get in there and get the at-bat. Okay, got it. That's super helpful. Just from a guidance perspective, it seems like you raised the 2027 revenue guide a bit higher than the beat in the quarter. Can you just talk a little bit about what's driving the increased confidence around the guide and any additional commentary on the visibility that you have? Look, sure. Again, we have the bulk of our hiring, really the peak of our hiring last year on the sales reps was in the second half of the year. We believe we'll start to see the return of that as they become fully productive. It's the ramping of the reps, as we've mentioned many times before. The other thing is, as Sanjay just mentioned, we're seeing strong demand in the AI, the uptake of the five new AI products released. Our expectations is that will provide a benefit. As I just noted, we expect net new ARR to re-accelerate in the second half of the year. Okay, great. Thanks, guys, and congrats, Drew. Thank you very much. Our next question comes from the line of Shaul Eyal with TD Cowen. Your line is open. Thank you. Good afternoon, everyone. Drew, it was, still is, pleasure working with you over the past decade, and congrats on what comes next. Sanjay, maybe more of a philosophical, maybe strategic question here. With the renewed momentum we're seeing on the hardware side of things, how do you see that capitalizing Netskope's business given it is a company that was originally born in the cloud? I think a couple of things. One is, when you think about organizations, they are more distributed than ever, and agents are more distributed than ever, right? They're on laptop servers, and beyond what they're using is distributed. For us, we're firm believers in this notion that people will want to consume their security and networking everywhere. They don't want to do truck rolls into offices and branches and so on. They're modernizing their edges to put as much as possible outside. That's sort of what we see. The infrastructure that we run, NewEdge, it is the world's most performant infrastructure from a private cloud network perspective. For us, you can think about the NewEdge infrastructure. It is their new network hardware, right? It is their new network cloud. It gives you better performance, better connectivity. I remember sitting with a CISO and a CIO a few weeks ago on the East Coast, and he told me, "Sanjay, I am so distributed. I got contractors, partners, I got new places I'm building up. I may have private data centers, I may use cloud. I don't want to have a network. I want to use your network. You provide it to me globally. You take care of that. I can focus on my core competency." For us, one of our big advantages is that we modernize and consolidate your infrastructure, which includes your edge and your network. That's what we're seeing over time, and that's what we continue to see. I think with the AI super cycle, it becomes more important. AI, when you look at agentic traffic, it is back and forth, right, highly distributed. You got agents making tool calls to cloud apps, private apps everywhere. The AI Fast Path that we introduced, which is the fastest way for inference, that's another big benefit for us from a network perspective. Thank you so much. Thank you. Our next question comes from the line of Brian Essex with JP Morgan. Your line is open. Good afternoon. Thank you for taking the question. Drew, congratulations from me as well. Well deserved. Sanjay, for you, just this one question. I'd love to get your insight of, with access to the foundation models that you've had, how have you utilized that in the platform? Any kind of initial observations. What kind of value has that access provided to the Netskope platform? Yeah. If you look at the foundation models, both part of Daybreak program, Glasswing, and to be blunt, even leveraging the open weight models, what we do is we built a harness and we basically leverage them all, and we use that in terms of our internal development cycles to test, to validate as part of our pipeline. That's what you should do. You already did that with other systems, and now you have these capabilities in the frontier models to find vulnerabilities early, and integrate that into your CI/CD process. That's what we do. Like I mentioned, we have a harness that does that, so we can leverage many models over time. As you've seen, right, there's a new frontier model every four to six weeks, and you want to be able to have diversity, and you want to be able to leverage them, to frankly, drive quality and security. We leverage that. As far as externally, we have our AI Labs team. We've had it for eight-plus years. We have 190+ of our own deep learning and other models. One of the proprietary advantages we have is over the decade, we have processed at a most granular fashion, for enterprises across the world, their access to cloud, now AI, to their private apps, at probably the most granular level you'll see of any company in the world. What we've gained and the gleaned insights from that and the behaviors, that's proprietary data. That lets us develop some amazing deep learning models that we leverage across data, threat, our network acceleration and beyond. So really for us, I mentioned this in the earnings, just previous to this, that we've transformed and are transformed really into this, not only AI-first from how we build our products and how we test them, but also just from our mindset, right, of how we develop, how we market. I think that's a journey that we're highly committed to, and we feel very energized by it. All right, thoughtful color. Thank you very much. Thank you. Please stand by for our next question. Our next question comes from the line of Keith Bachman with BMO. Your line is open. Hi, many thanks. Drew, I also echo congratulations. I hope your golf game improves in the process. Two things for me. One related, Sanjay, for you is I did spend two days down at Gartner Group's security conference this year, and what seemed to surface more so in past years is obviously some tech trends, but also the notion of consolidation of spend. Even the Gartner Groups were advocating this more so in past years. I'm wondering, as you think about your competitive landscape, when folks like Palo Alto are using their platform to crowd out other areas, how do you think about pricing? Has pricing been any different, say, in the last 90 days? How do you think about that pricing playing a role as we're going through this dynamic time of technology transition? My follow-up to Drew, sort of related is, Drew, the net retention rate was a little lower than at least I was thinking. It's a backward-looking number, but how do you think that trend plays out for the year? That's it for me. Many thanks. Yep. Great question. I think a couple of things. One, when I step back, and you look at the networking and security and AI market, I've never been a believer there is one platform for all of that, and nor do I believe that CIOs and CISOs want one. They don't want a hundred, but they don't want one. They want a few core platforms that are open. I think I've seen that, when I talk to CIOs and CISOs. For us, we are one of those core platforms. We consolidate over 20+ different point areas, and we become the new highway and the new on-ramp to the internet for agents and for users, and for apps and beyond. That's really what we do. When you step back a second, for us, we measure ourselves very closely on our POC win rates, and I mentioned those are consistently above 80%. When you think about pricing as within that, we aren't the company that is going to win because of pricing. We're going to win because of the value and the technology we bring, and then the operational savings because we are not a price list integrated platform where we put a bunch of things on a price list. No, everything we ship, we have a rule. It must be same console, same network, same client, same policies, so it's operationally easier. For us, where we win on the cost side is, well, it's easier to operate these guys, right? What I have seen, yeah, you're right. In the pricing, sometimes you'll see some competitors try to lowball on pricing once they know they've lost. I think we've learned, and I think customers have learned that doesn't work. There's a reason you pick, in this case, that win rate of over 80%. That's what we've seen. As far as net retention, I'll let Drew take that question as well. I think one thing to just think about in net retention before I give it to Drew is we're seeing right now in this Q1, historically high GRR. We've always been above the mid-90s, but our customers, they really like us. I think for us, NRR fluctuates, right? Quarter to quarter. We'd always said we'll be in this range. We were obviously following a tough comp, right, where Q1 of last year, our net new ARR grew 80% or so. It's definitely a tough comp. From an upsell perspective, what we're very bullish about and what we're focused on is that AI pipeline is strong, right? Customers really want on the platform we have the ability to secure and accelerate their AI usage, and we feel very great about delivering some amazing products to them in that realm. Yeah, Keith. As Sanjay said, look, GRR is at a record high, so we certainly have strength on the customer retention side. Look, the mix of deals can vary quarter to quarter. Q1 of last year, upsell grew 116% on the heels of multiple seven-figure deals, right? Very strong upsell quarter, and it can vary quarter to quarter. The next quarter, it was sort of half and half upsell. The growth came half upsell, half new business. This quarter we saw strength in new logos. The new logo growth was 59%, for instance. It's going to vary quarter to quarter, as we said before. When you think about it just in terms of the long-term, we really think mid-teens is the right way to think about where NRR should be. I think we're probably at the lower end of that right now. Obviously with the strong AI pipeline and the reps ramping, we think we have an opportunity to certainly go up from there. Okay, great. Thanks, Drew. Thank you. Our next question comes from the line of Rob Owens with Piper Sandler. Your line is open. Wonderful. Hey, thanks for taking my question. Would love to get a sense of how customer conversations have changed over the past couple of months. Obviously, a tremendous amount of activity, I guess from a couple perspectives. Number one, the strategic positioning of SASE, what are the different types of problems that customers are looking to a Netskope to help them solve at this point? Yeah, it's a good question. When I look at use cases and the reality is, SASE has become broader and broader and broader, right? More and more things put into it and consolidated. I like the way you think about it, which is, hey, what are those use cases? For us, from a use case perspective, one, customers want to be able to secure and accelerate their broad internet access for web, for class, for AI. That could originate from a human, could originate from an agent, could originate from a robot, whatever it is. They know that, wait a minute, at some point, a user, an agent, a robot, it needs to go hit something and access something to get information. Well, wait a minute, what's the best way and the best path to get that information? What's the best network? That's for us, NewEdge, right? Two is, okay, when I'm doing that, how do I know what data is transacting? How do I know this is valid? How do I know this AI agent is supposed to be making a tool call and supposed to be getting that information from Slack or OneDrive or my private app? Really it comes down to, hey, what is the best path as information flows, and what is the best way to govern what data those things that are requesting that transaction should have access to? That is one of our top use cases, and that really speaks to this notion of distributed security and networking for this cloud and AI era. The second, obviously within that, there's many use cases. The other one is, obviously partners, third-party risk, and contractors, right? This is a big notion in the hyper-connected world. How do I enable people and agents who are not part of my organization to still have access to what they need? That comes to modernization of what used to be their remote access and VPN infrastructure and move to the Zero Trust concept. Then the third is unification, modernization and unification of data protection. As you know, for us, we use neural networks and deep learning models, and we cover your data no matter where it is. We look at every prompt, we look at every response, we look at every MCP transaction, and we say, "Is this data supposed to be transacting in this way?" If it isn't, we stop it. Right. For us, data protection across the AI ecosystem, across your endpoint, across your email, across your on-prem apps, private apps, and your data stores and data lakes, we bring unification to that with a modern way of classifying it and protecting it. That's another big use case. The fourth is, look, for many of our customers, they're consolidating and converging their network infrastructure, and they're taking a lot of cost out of what they used to spend on dedicated network infrastructure and leveraging NewEdge for that. Those are some of the top use cases. Thanks. Thank you. Our next question comes from the line of Richard Poland with Wells Fargo. Your line is open. Hey, guys. Thanks for taking my question. I guess for AI products specifically, AI Command Center, AgentSkope, Agentic Broker, are there any early signals on maybe how those sales cycles compare to core SASE sales cycles? When we think about AI, are you seeing an established budget owner yet on the other side of the table? Is it coming out of existing security budgets or is this like a net new area of spend in security? Yeah. I think when you look at the most enterprises, they are trying to figure out, how do I secure this unstoppable usage of AI? 90% of AI usage is shadow or end user business unit led. I think they're in the infancy, and we're in the early days of AI security. We've obviously seen fastest growing pipeline we've ever had for a product with AI security. I think that budget is a mix. Some of it comes from a net new budget as they roll out AI programs. There's generally, just like you roll out an app, there's generally a percentage of that attached to security. Some of that will come from your app budget, some of that will come from your infrastructure and security. I think people are generally figuring that out. Anyways, that's how we've seen it. I think AI Command Center, for example, a product we released this week, we developed that with many of our customers because they wanted unification of how they could view AI. For us, usually when we release something, we generally know it'll hit the mark because we had a lot of customer involvement as we built it. Great. Thank you. Thank you. Our next question comes from the line of Catharine Trebnick with Rosenblatt. Your line is open. Hello. Thanks for fitting me in. Much appreciated. I want to go back and ask you about the 80% win rate you're seeing with the POCs. Are you seeing any change in who is initiating the POCs? Is it more displacement or greenfield? Any change in the competitive shortlist changing? Thank you. Great question. When you look at the POCs, generally, if you look at the buyer for us, it crosses the CISO, the Head of Infrastructure and Ops, and the CIO, and often the CIO has these people reporting to them, right? He or she, in addition, may have a peer now called the Head of AI. The Head of AI is a newer role, doesn't necessarily have a large group, but is, I would say, an influencer as they drive AI security. That would probably be the one change, that you have this new role that some companies have, which is Head of AI. Otherwise, you have the common cast of folks who are often making these decisions. From a competitive perspective, from a win rate perspective, we don't see a difference. We are broad now, we have over 20, 25+ products. Depending on the area, you may see some different folks. You may see, for example, when you're looking at modernizing remote access, you would have seen what I would call two generations ago incumbents. You may see the traditional VPN vendors from the past. When you look at AI security, nobody has anything. It's all greenfield, right? Really when you think about the use case, some is greenfield, some is I would say two generations ago replacements, and then some is what I'd call first-gen replacements, which are first-generation SaaS where people get frustrated because they don't let them put the business policies they want, they don't let them protect their data and beyond. It is a mix. Great. Thank you. Drew, sorry I won't get to work with you much. I came on the stock too late. Thank you. Our next question comes from the line of Eric Heath with KeyBanc Capital Markets. Your line is open. Hey, this is Ishan on for Eric. Thanks for taking the question. Sanjay, expectations were that security budgets would start to expand ahead of Mythos-like models becoming available, yet peer numbers seem to not be seeing that clear inflection yet. Is it fair to say that maybe rather than urgency, customers are still more in an evaluation phase? If so, when do you expect to see that shift and demand for security budgets to meaningfully inflect? Thanks for the question. Great. Appreciate it. I think in reality, I have a rule. I talk to generally two CXOs at least a day. Obviously, I have big events, I talk to hundreds, but one to one, I try to talk to two CXOs a day. When I talk to them about AI, the reality is they know they need something. They know they need to secure it. What we say is, "Hey, you need to enable it, and you need to secure it." How they do that, the reality is there's no article or book or text that they read to say, "How do I do this?" This is hitting them, too, to say, "Wait a minute, how do I do this? What's the best practice?" For us, just for example, we're running something called AI Fast Lane in cities across the world, and we literally do this. We show them what to do, we bring in a customer who's done it, and beyond. I think what you're seeing is that, as I mentioned, the pipeline that we've seen for AI security, fastest growing we've ever seen. People are in the infancy. We do see adoption starting, at least in our case, more in the second half. I think over time, over the years, people will definitely mature and AI security will be, here's the way to do it. Right now, they're learning. Thank you. Our next question comes from the line of Shrenik Kothari with Baird. Your line is open. Great. Thanks, guys. This is Zach on for Shrenik. Thanks for taking the question. You've highlighted stronger engagement with large GSIs and strategic partners, including some major enterprise transformation work. I guess the question is, are partners mostly helping with implementation still, or are they becoming maybe a real source of pipeline for you guys? Thanks. Yeah, it's a great question. I think the answer is really both. The reality is when you look at partners, you can segment them. You could have alliance partners, and obviously you have strong alliance partners, folks like Okta. We were named Microsoft Security Partner of the Year last year, CrowdStrike, others. You work with them in the field and beyond, and you want to make sure you integrate and they have great products and platforms and beyond. Then you will generate and share often in the pipeline. Then you have what I'd call resellers and distributors and so on. Great for procurement and also for sourcing, right? You want to have portion of your deals where they're sourcing it, and we do see that. Then you have, of course, the system integrators, where their focus is implementation services, managed services, consulting services, right? Less so, "Hey, I want to resell what you do or beyond." Theirs were, I mentioned, for example, on the earnings call, the managed SaaS offerings with Deloitte and other system integrators. Really for us, we think about it that way, implementation services partners who can source and sell and make procurement easy. In the mid-market, managed service providers who really do the whole thing. They sell, they implement, and they manage. Our focus is really all of those to make sure that we cover the different needs of enterprises. Great. Thank you. Thank you. Our next question comes from the line of Trevor Rambo with BTIG. Your line is open. Hey, great. This is Trevor on for Gray Powell. Thanks for taking my question, squeezing me in. Just one for me, maybe for Sanjay. What has been the demand or attach rate of the networking products, like an SD-WAN, looking like in new deals today versus a year ago? Is the networking side of the equation gaining more traction this year, or is it still more predominantly on the security side? Thanks. Yeah, it's a good question. When we think about what we do, we always think about it as security and networking. The reason is that if you think about our customers, we have customers who have hundreds and thousands of employees. They have now tons of AI agents. All that traffic goes through us. One of the first things they do from a security side is obviously they do what I said, which is test the data protection and make sure the policies work and so on. In parallel, the infrastructure and network person, they need to make sure that, wait a minute, what's my end user experience? Or my end AI agent experience? They're validating that. We do view every sale of ours as security and a networking sell, because NewEdge is becoming their new network, right? That's how I would think about it. From a specific product perspective, while we don't break out SD-WAN, one of the things that we have seen is that our SD-WAN is really a integration of security and networking functionality together to modernize the edge, right? You want as little as possible on-prem at the branch edge or factory edge. That's really what that is meant to do, put as little as possible and as much as you can in the cloud. We've seen good uptick in that, and we mentioned some great wins, and as well, folks wanting single vendor SASE, we're one of the vendors who truly can deliver it in a unified way. Thank you. Ladies and gentlemen, I'm showing no further questions in the queue. I would now like to turn the call back over to Michelle for closing remarks. Thank you, everyone. As we wrap up, Sanjay, Drew, and I want to say we thank you for joining us today and especially staying over a bit longer. We're pleased with our Q1 results and the momentum we're seeing across the business. We remain focused on helping our customers with their cloud and AI transformation journeys. We appreciate your continued support. We look forward to speaking with many of you over the coming months and weeks. With that, we can close the call. Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.