Nutanix, Inc. (NTNX) Earnings Call Transcript & Summary

Hi, and welcome to Courageous Leadership in Times of Global Crisis and Uncertainty, an HMG Live! virtual briefing covering what matters most to drive a winning agenda and make the future a better place. A warm welcome to today's host, lead principal and CEO of HMG Strategy, Hunter Muller.

Hi, and thank you for joining us this morning for the 2020 Boston CIO Virtual Summit. I'm Tom Hoffman at HMG Strategy, and I'm stepping in temporarily for Hunter Muller, who is experiencing some technical difficulties. So we're delighted to have you here this morning. A warm welcome from our team and each of the speakers. I wanted to thank our partners for all their support in helping to support today's summit. Our partners for today include Illumio, Nutanix, Zoom, Adobe and Fortinet. Thank you so much for your support. You've been wonderful partners to work with and very progressive, helping members of the HMG community to power forward with their initiatives as well. So we've had a number of virtual events since the pandemic went into full force in early March. We hosted 10 virtual events in the first 30 days. And over the next 2 months, we have more than 40 events lined up, including virtual CIO summits, CISO summits as well as webinars and other events. So stay tuned and please stay with us. Well, we also have a number of events coming up in the coming weeks. Next week, we have the Chicago Virtual CIO Summit on June 2. Be sure to tune in tomorrow, we have an important CISO Summit coming from Washington, D.C. with a very impressive list of speakers from both the public and private sectors who will be talking about the role of CISOs in helping to move the business forward and to reimagine the business as well as to help address the future of work. I think it reflects how the role of the CISO has really evolved in recent years, and especially as we're seeing in this current crisis that we're going through. So thanks again for Zooming in. And at this point, we'd like to kick off the event. At this point, I'd like to invite Sebastian Goodwin to join us. Sebastian is Vice President of Cybersecurity at Nutanix. And Sebastian, thanks so much for joining us this morning.

Good morning. Thanks for having me.

Pleasure to have you.

So Sebastian, to get started, could you just share with us a little bit about your background and your role at Nutanix?

Sure. So my name is Sebastian Goodwin. Nutanix is a software company. We've got about 7,000 remote employees now around the globe. We're a software company with over $1 billion revenue operating globally. And so it's my role to keep our infrastructure, which consists of our own data centers, public cloud infrastructure and multiple clouds, a true hybrid environment, it's my job to keep all that secure.

Excellent. Thanks. Well, I see that Hunter has rejoined us. Hunter, can you come into the call now?

Great. Yes. Can you hear me okay, Tom?

Sure thing. You sound great, Hunter.

Thanks for helping out, Tom. Good to see you. Sebastian, I did a little research on you, which I like to do with all of our guests, and a little review. Your background is amazing. Let's -- walk us through your background because you're really, truly a thought leader, a sought-after keynote speaker as well as adviser. And you've authored 2 books.

Yes, well, let's see. My background in security goes all the way back to like high school, where I was trying to hack into our computer systems and giving my computer teacher a hard time. But over the years, I've spent time in consulting with a number of organizations, IBM Global Services and others, and CISO at a couple of companies. I also teach a course in managing cyber risk in a new Master's degree in cybersecurity program at UC Berkeley, which has been really interesting to help create that program and create that course. And then yes, like you said, over the years, I've written some books in cybersecurity, on the technical side of things as well.

Do you have advice for folks? You have such a diverse background. It's -- and to see somebody who's put together a career of sent with so many different industry data points.

Advice? Well, I try to get different angles on the cybersecurity industry. And one part of my background that I didn't mention is that I also spent a few years working in the marketing department, which I never thought I would do. But I led a product marketing team at Palo Alto Networks for a few years that focused on launching a new endpoint security product. So really, my goal in my career has been to not stay in the IT department the whole time, but to spend some time as a consultant, trusted adviser, sometime in the IT department, some time on the product side of things, launching products and launching go-to-market and a little bit of time in academia.

Excellent. So when you think of leading Nutanix' security efforts in the whole work-from-home initiative over the past 10 weeks, what were the lessons learned? And what worked?

Yes. So our -- a number of lessons learned. Our priorities when we made this shift was really about enabling everyone to work from anywhere, any device seamlessly and very rapidly. And we -- like most companies, we had some remote access capabilities already in place, but we had to instantly pivot to supporting at scale 100% of our workforce working remotely. And so we focused on making it easy with things like our -- we have Nutanix Frame Desktop-as-a-Service, which gives people the ability to use any device to access a virtual desktop from anywhere. So we had to quickly scale that out, make it available to everyone, and in multiple regions, because one of the things about virtual desktops is some folks want one that's local to them for performance reasons and other folks want one that's actually local to the applications, resources, servers that they need to access. And so what we ended up doing was creating a bot and slack where somebody can just go in there and say, "Hey, I need a virtual desktop." And it responds and it says, "Well, which region do you want it in? Do you want it in APAC, EMEA, Americas?" And they can just click on one and it says, "Look, here you go, I just provisioned it for you." So it's those types of quick, simple interactions for our employees that we wanted to create and really with a focus on our front line, our employees who support our customers, because obviously our customers are also going through these rapid transitions, and we have to be there for them. So our first objective there was to make sure that our support was able to operate without any downtime.

Sebastian, have you ever seen such a fast pivot to another architecture that needed to be safely secured, number one? And what were the lessons learned?

Yes. No, so I haven't seen such a rapid pivot like this. And one of the things we learned was that we really needed to think about which tools in our environment and which processes gave us resilience, which ones were resilient. Those are our bright spots that we need to focus on and say, here's something that worked. And on the flip side, what are some of the tools and processes that became liabilities throughout this process? And we focused a lot on -- in our security operation center, on resilience, which tools are working for us, shifting from this brand-new SOC, actually that we have just built, one of those security operations centers with all the nice big screens on the walls and the dashboards. And then all of a sudden, we can't work there anymore, right? So people are home. And so what are the tools and processes in that SOC that we're able to quickly flip over? And those are the things that we've learned to focus on. We've also learned during this crisis that we can't miss a beat in the SOC, in security operations. We can't take a few days off to kind of reconfigure things, right? Some of the folks in the audience might know that a few weeks back, there was a big vulnerability announced in a popular software that a lot of companies used called SaltStack, right? So in the midst of this pivot of our SOC, we had to deal with that. And teams had to react very rapidly. So if you were kind of in the middle of reconfiguring your SOC and getting people adjusted to work from home, and you missed that alert or you missed that -- the ability to respond to it very quickly and patch it, that caused a lot of companies to have a crisis within a crisis now because their systems are getting compromised. So we had to really stay on top of that. Another lesson learned that I find interesting is that, during this time when our offices are empty for the most part, it's actually a really interesting time for security teams to look at the network traffic going in and out of these offices, right? It's a very unique opportunity to see a quiet network. And we're always looking for needles in haystacks in the security field. But now you've got most of the noise out of the system because you don't have a bunch of employees there with their day-to-day web traffic. And you can look for things like rogue devices. You can look for, does one of our TVs in the conference room or the conference room phone systems, is it acting strangely on the network? Because that can be indicators of malware. And these systems do get compromised. So it's a great opportunity to do that as well.

Sebastian, thanks so much for coming on the program today. It's -- what a challenging time. Nutanix has been a great partner of HMG and the HMG platform and network for community for years. Really appreciate your support and the events powered by Nutanix and our other partners here today. Well, give us a ray of hope. Is this an exciting time to be a tech leader, the most interesting time?

Yes, it's a really interesting time. And I've seen some really amazing things coming out of our teams. One thing that I found really uplifting is some teams within Nutanix and even collaborating with some of our customers have been involved in an initiative called Folding@home. And this initiative basically allows you to donate CPU resources from your infrastructure from -- even from your own laptop to -- toward medical organizations that need that CPU resource to find vaccines for things like COVID, right? And so they're pooling resources, and it's really interesting to see the teams come together. And there's a scoreboard. And for -- sometimes, the Nutanix team was up there pretty high. And that's been really fun to see.

Hey, Sebastian, thank you so much for coming on today's program. Great job. Looking forward to more experiences and meetings with you in the future. Thanks for coming to the program.

Thank you.