Workday, Inc. (WDAY) Earnings Call Transcript & Summary

Hey, it's Karl Keirstead. Thanks for joining this virtual fireside chat with Workday at the 2020 UBS TMT Conference. As you are likely aware, we've got Chano Fernandez, the Co-CEO of Workday. In terms of format, we'll stick to about 35, 40 minutes. You can ask questions if you'd like, either through the web link, I think all of you have or, of course, feel free to e-mail me directly at [email protected]. I'll also note that Workday's safe harbor provision applies for this discussion. So with that, welcome, Chano.

Good morning to you, Karl. Thanks for having me.

Yes. Our pleasure. So Chano, maybe I'll start just on a comment broadly about the demand curve over the last 9 months. I think despite ups and downs and what I'm sure are challenges, I think it's important, and maybe you would like to emphasize this, too, that in the end, Workday is likely to post subscription revenue backlog growth not that far off from what you were anticipating prior to COVID. So I must admit, Chano, I was nervous. Some investors were nervous that projects would get deferred. And in the end, you ended up pulling out growth that was actually remarkable given the pandemic. So maybe the opening question is just over the last 9 months, what has surprised you about the resiliency of Workday through the pandemic?

Thank you, Karl. And I want to start by -- well, saying hello to all of you, and thank you for making the time and joining. And also by thanking my team and the Workday team who has done an amazing job during this time. I mean we knew ahead of the pandemic starting that we had good resiliency of applications and that we have mission-critical applications that certainly have created stickiness as well on our customer base. But this pandemic, if anything, has demonstrated so as we were potentially nor even anticipating being with customers who have been adjusting their planning around their people and their money more than ever before, or they have had to be closing their books remotely or they had to understanding better the employee sentiment out there or identifying critical workers like in the health care industry, for nurses and doctors, that maybe they could bring back to work or maybe they were retired and they were needed in these times, how you identify those or just addressing better their diversity and belonging needs across the company, clearly has been very critical needs that those companies have been addressing, and we've been helping out through this pandemic. I would say as well that internally, the team have done a great job. If you look at the product teams, we continue with our normal innovations through remote, our 2 updates per year. That has been a lot of innovation in areas like the skills cloud investments or planning or accounting center. We clearly pivoted in sales to fully remote virtual cycle, and we've been able as well in services to bring a lot of customers remotely during this signing production. We mentioned in our last call customers like Walmart or Accenture or GE, among others, coming live fully remotely during this time. So it's been quite amazing what we've been observing and I think quite reassuring in terms of the resiliency of our business model as you were commending, Karl.

Yes. And Chano, you and Aneel mentioned a couple of calls ago that one shouldn't think of Workday's product set as being quote -- especially HCM, as being back office per se, that you were defining this as employee engagement systems and perhaps post COVID, there is a heightened interest actually in ensuring employee productivity. So do you mind giving us some additional color on that concept, Chano, that perhaps COVID has spurred a greater interest in using modern HCM systems to better engage with customers while we're all working from home? How real is that phenomenon out there?

Yes. It's a great question, Karl. I think what we've been saying is that, clearly, we see that COVID has resurface an acceleration for companies to realize their need to move to the cloud just because they're seeking that flexibility and that agility on some of the cases that I mentioned before and several others. So I think that place us in a really great position, right? I always say, Karl, to our customers that Workday is a great administrative system from either managing your employees from hire to retire or for managing your financials fully. But overall, it's a business application framework, no doubt about it, that is helping you out to get great insights and to make these issues, right? And the way you can do that, being it either if you are making organizational decisions or basically divesting or acquiring companies or complete need of flexibility in how you're changing your business model as a whole, we will be able to help you all greatly, right? Companies that have been making decisions onto splitting companies, changing models, just to do that into some of the legacy on-premise systems, it's hard. It cost a lot of money. It takes a lot of time. And in Workday, you can do that on a very, very agile way. So during this period, what companies have realized is that doing that remotely. And when you are able to have those corridors or coffee conversations with those face to face meetings, you're very comfort on how you do those changes. And companies have said, it is really the time to consider to move to the cloud, our back office applications as well, HCM and financials.

Got it. Okay. Great. That's a good backdrop, Chano. I wouldn't mind just because you reported your results a couple of weeks ago to maybe go back to your October quarter results and maybe offer a little bit more color. So I'd love to ask you 3 or 4 questions about the 3Q results before looking forward. So if you could unpack the drivers of that, I think, roughly 23% subscription backlog growth that Workday reported, it does feel like some deals that got stalled back in Q1 got pushed and closed in 2Q or 3Q. So maybe my first question to you, Chano, is how much of that 23% backlog growth in 3Q might have been some type of catch-up from deals that were pushed in prior quarters? Or maybe there are other key drivers that got you there.

Yes. I mean we always have some dynamics of deals that can move around from quarter-to-quarter, but I would not say that this was the story of Q3. I think if we take a step back and go back at the beginning of this environment in March and April, we took a pretty test -- did look into our pipeline. We really explained it and described it because we knew that this type of environment, it would be required that what we have out there is rock solid. And how we're looking into it, we would need to look with different lenses that potentially we'd look at that pipeline before, right? With -- so we have very clean pipeline. What clearly potentially surprise us in a positive way is that we were able to overperform or outperform onto the conversion rates that we've been discussing with you on that pipeline, maybe because it was very clean. And at the same time, clearly, many companies as well, more than we anticipated, mainly, were looking to move forward into this environment with some of these transformation projects, right? So that was really what happened in Q3. I think the other thing to impact the quarter that happen is that customers decided to sign contracts that we have been longer in duration than we anticipated, and that created a bit of tailwind on our backlog growth relative to our guidance.

Okay. Got it. Chano, one of the other highlights to me in the quarter was your disclosure that the installed base team generated 50% net new ACV growth. I think it was for the fourth quarter in a row. Do you mind unpacking that number a little bit? What drove that? What specific products might have contributed to that number? I know you cautioned us that it will likely slow going forward, but I'd love to focus on the 50% number and what products are getting you there.

Yes. I think we commented a couple of years ago, as our customer base was growing and is now over 3,500 customers or around 4,000 customers, we -- and as we were increasing the number of innovation and the number of SKUs that we have there to really upsell and cross-sell on deriving more value to these customers. We thought that we needed a higher focus onto the installed base as a whole. So we did some double down investments in terms of the global market sales. We moved some great sales talents as well from our net new business local to the installed business. And as a whole, in terms of putting the right dynamics and drive the business as our main business, which still is the most significant part of our business, but the new [indiscernible], as you know, and that has driven really great dividends, right? Across, I would say, many of the products that we've been commenting being core financials or learning or planning or pricing analytics or even Workday [indiscernible] more recently or were being extend and what they help. I mean there's been contribution for a lot of these new innovation on that -- those upselling efforts. That is -- it's same great dividends, right? As you commented, it's been the fourth quarter in a row that has been a 50% net new ACV growth. We cautioned you on Q4 that potentially that would be hard to beat. But that's just a question of the comparison towards last year. Last year, it was significant, much higher than that one, Q4 being our largest quarter. So that has nothing to do that we do not see this business being a significant growth driver going forward as we keep increasing our base that, of course, is coming from adding more new logos and b, we keep increasing investments and innovation that we can bring to this customer base, right? So our expectation is going to be healthy growth on the installed base as a whole going forward.

Okay. Great. Chano, another thing that stood out to me in the quarter was the accounting center impact on the financial side. We've started hearing this from our own customer chats that partners have flagged it as a significant feature improvement that should create a tailwind for Workday going forward. I know you called it out as being a potential contributor to Fifth Third Bank embracing Workday financials. But maybe, Chano, you could put in context how significant it is from the range of interesting feature improvement to something that is actually a real tailwind for next year and the year after. How material is it?

It is material. It is strategic, and it's very critical, especially to unpack and really provide growth to our core financials. You need to think about accounting center as a very simple way to bring operational data from third-party systems and making that automatic as part of the GL on the core accounting, right? And clearly, many verticals have that need. It was instrumental, as you commented, Karl, on Fifth Third Bank, but it was also in Fannie Mae, KeyBanc, among many others. We've started to focus more accounting center on the financial services industries as those peers, as you can imagine, those companies have a lot of operational data being it loans, being it claims, being it policies and several others that they need to bring back into the GL. Not only bring it back, but it's also the ability and capability to trail it back and audit back that transaction and that data point, where is it coming from? And that is quite unique that we are just able to do and others just have a hard time to do that. It can manage significant loads of data and scalability. And as we said, we focus initially more into the financial services industry, but you should see us utilizing accounting center in other verticals, like it could be telecommunications or retail or even manufacturing because it's only applicable to those, as I said, that any operational third-party data that it needs to be brought into the general layer as such. So very strategic, and should provide a good tailwind going forward.

So Chano, just to put it into perspective, is the notion of accounting center as a means to pull in operational data into the GL, is this something that SAP and Oracle have had for some time that Workday is now sort of catching up to? So it's no longer creating friction in the competitive process? Or is this something that your rivals don't have that takes you a little bit beyond? Can you describe that?

I would say different flavors, right? Ours is more modern, more built toward the cloud. I highlighted, for example, the capability of [ auditing ] and trailing back to the original data, where is that coming from, and that is something that competitors have a hard time to do, among other things. And then kind of the flexibility of how that data leads the -- is as much as -- is kind of looking to providing the right insights and visibility. So I would -- I don't know exactly the details of some of the competitive ones. I'm talking more on what I hear from our customers and I think it's really a differentiated capability that we bring now.

Got it. And maybe, Chano, while we're on the subject of core fin, can you bring everybody up to speed on how that end market feels right now? Obviously, these are still tough times. And I'm sure some CFOs and CIOs are reluctant to make significant changes to their core financials right now, but perhaps others are in a greater need to move forward. So what's the state of the core fin adoption right now, not just for Workday, but broadly across the end market?

Yes. I think you described it pretty well, right? I would say that on the environment right now, particularly on some of the net new logos, you may have seen more headwinds, some more reluctancy to right now move on your core fins, say, to the cloud or move your core existing of records. On the other hand, many of those organizations have been hampered, held high, has been either to close books remotely or to get the real insights and visibility. Sometimes it's even being sure that we are reporting the single version of the truth, right? And has been with no pain of my ability to do that. And clearly, that's creating the notion and nurturing the need for me to move towards a more flexible, an agile system, that is not hampering my strategic efficiency going forward, right? So that I think is part of what we see or expected on the pipeline where we're cautiously optimistic of how that pipeline is building up going forward around financials class overall and how that is becoming a bigger part of the mix of the pipeline that we see going forward.

Yes. And maybe, Chano, sticking to the financial area. With that as context, maybe you could describe how customer demand to move some of the adjacent [indiscernible] how that motion feels different, potentially better than the core fin side does? Maybe an update on the fin plus, if you'd like.

Yes. On the fin plus categories, like planning and sourcing, are 2 very typical and very important problems that companies are trying to solve right now, right? We've been commenting on some example on this environment that we think companies kind of planning 30x times, when they were running ahead of the pandemic because the plans from yesterday are not longer relevant for companies, and everyone is trying to plan on what if scenarios around my people and my money, what do they need, right? So clearly, the interest there has been significant and still is significant, right? On the sourcing and procurement side, I would say companies are reevaluating their suppliers and trying to find ways to optimize their spend. I think that's going to continue as we get out the pandemic. But clearly, on the times to come, that is going to remain very relevant in the near future. So this has been a great installed base motion when you were asking me and these SKUs either running or procurement or sourcing has been a significant part and contribution of the growth that we see on the installed base, and to be honest, on the growth opportunities that we see going forward when we look at the pipeline and the composition of that one.

Yes. And Chano, most of the investors listening in terms of category leaders, think of Coupa on the procurement side and perhaps at least among the more modern vendors, Anaplan, on the planning side. Can you talk a little bit about how you're working with your product team to take Workday procurement and Workday planning and make them increasingly competitive against those best-of-breed? Maybe it's feature improvements, maybe it's a sales motion to bring those organizations upmarket into Workday's core HCM base. Maybe describe some of the things you're doing to make yourself more competitive against the Coupa and Anaplans.

Yes. It's a great question. I think when we look into having solutions for our customers, we look into how do we make those best of breed, the best in market on its on merits, and on its own basis. Of course, there are some advantages of these solutions for customers that are already for the customers and it's the typical story of valuing kind of the very tight integration and what you're paying out of that versus kind of a stand-alone solution standing on its merits. As I said, we like to look onto both, right? And I think we made really great progress. If you look at planning, clearly bringing this solution at scale and to market, it was already great when it was part of the Adaptive. I think when it comes in terms of what has been improving from a Adaptive part of Workday and bringing the roadmap forward has been mainly around scalability and performance and to being able to serve the largest customers on the planet. And we now have a number of references of those that we are bringing successfully [ light ]. And then, of course, they're seeing investments that we discussed around the Power of One, and bringing part of the Workday family that have produced good dividends into customers seeing value, right? When you look at this, so far, it's really the worthy strategic sourcing. So it's really that selection of suppliers is created at running those RFP processes that are significantly cost driven and they pay on their own for companies. And [indiscernible] sourcing is a great product in terms of the UI, the ease of implementation and consumption, customers can be like in 2 to 3 weeks, already seeing value. So it has a tremendous ROI, Karl, and that is why it's very enjoyed by either the procuring or the financial departments of our prospects and customers out there. So that's how we -- that's how we're looking at today. So we're looking more into ourselves. And as I say, how those products become leaders on their own merits in terms of our ability to implement and meet customers principle as well our vision and overall [indiscernible] those solutions.

Got it. Okay. Great. Thank you for that, Chano. That's very helpful. And we were -- we've been talking so far about some of the 3Q drivers. So if you don't mind, let's flip to the forward-looking into the fourth quarter. I know you and Aneel and Robynne talked a little bit about some of the drivers behind the fourth quarter outlook. But that was probably the key issue around the stock after your results. The fourth quarter subscription backlog growth of 14% to 16%, which has decelerated from prior 20-plus percent growth. So Chano, I'd love to ask you, just to unpack that fourth quarter guidance, did anything change? Was it just tough comps? Maybe you could give us the 3 drivers behind that, perhaps conservative outlook, but I'd love to hear from you.

No. Nothing has really changed, right? We've had 2 quarters now in a row where we've seen stability in the market relative to what we saw in March and April and where new business trends have outperformed our initial reduced expectations when we first came into this environment, to be honest, right? We have been pleased by our RPO performance overall, relative to our expectations over the last couple of quarters. But we continue to have the same guidance philosophy, which is -- we guide based on our best views of the business as we have them today, right? The Q4 RPO guidance reflects our best deal given what we know. I mean in corporate, they're very difficult comparison from a year ago, where we saw meaningful acceleration in new ACT bookings, if you may recall, Karl, which we called even the pre-COVID to be a tough comparison at the year, right? More so in this new environment, where we face clearly some headwinds in terms of the net new business as well. And the uncertainty that remains in the environment, which we remain cautious about, right? And we also, as I mentioned before, we've also been getting some duration benefit the last couple of quarters. We are not expecting those to persist in Q4, but we'll see when we get through the quarter. As you know, it's our largest quarter as it happens for most of the software players, so it's a very significant one for basically picturing the near-term future growth and backlog as a whole.

So Chano, just on that, if you don't mind elaborating, why wouldn't Workday see similar duration benefits that you've seen in the last couple of quarters? What would have changed from 2Q, 3Q to 4Q? Or perhaps you just want to be conservative and not assume that, that benefit would continue. Maybe the distinction between Workday's conservatism around the duration versus maybe something you've seen that's changed?

Yes, it's a good question, and it's a difficult call out, Karl. I wouldn't like to say where this conservatism, I think is, of course, because we don't premium or push or try to convince our customers to go shorter or longer. At the end of the day, we ambition to have a long-term relationship with them, to be honest. But if our customer decides to be onto a 3 or 5 or our customers go 7 years is really more their decision on what their preference, how they are looking at the overall business case and the discussions they're having and how they would like to set up kind of this versus that in terms of the current strong relationship we're going to be having as far as going forward, right? So it's -- and of course, as you can imagine, that is more determined when you have some of these large deals that may create, of course, a bigger backlog. And it's difficult to say what exactly at this point, we're going to be ending up with that particular customer because those are more discussions that tend to happen until really later part of the cell cycle as a whole.

Got it. Okay. Thank you for that, Chano. That's very helpful. And if we stick to the forward outlook, but move beyond the fourth quarter, I know you haven't given any specifics, but maybe the question I'd love to ask you, Chano, is when you and Aneel and the rest of the leadership team and the Board sit down and talk about this post pandemic recovery that you expect. And this has become an interesting part of the Workday story where it's become an interesting potential recovery stock, let's say. But there's ambiguity among investors, Chano, as to what exactly post pandemic means. It's anybody's guess. I certainly don't hold you to having a perfect crystal ball that nobody does. But when Workday talks about post pandemic, what are we roughly talking about? Are we talking about sort of second half fiscal '22? Or realistically, do you mean fiscal '23? Can you try to bracket it for us?

Yes. Let me see if I can give you some color. And then let me know if you would let me to go more in detail, right? It's hard to really pin up an exact time line at this point, right? And we're still building pipeline for next year really actively. But certainly, we are cautiously optimistic that the net new business strength will be reaccelerating next year as some of these COVID headwinds subside. And as we continue to expand our rest of the world penetration and continue to go deeper with the office of the CFO solutions as a whole, right? I think it's important to note is that it will take time to impact on our subscription model, right, just like some of the headwinds this year will be more fully felt in next year's subscription, Karl, revenue, we are cautiously optimistic of new business improvement next year, but that will be lagging, right? So we're putting significant investment right now to help drive that pipeline growth and to capitalize on the post-COVID opportunity. As we commented, we are doing more investments as well from overall market perspective in sales and marketing overall. We are still facing -- or we're still expecting to face near-term headwinds, but we are starting to see -- we're starting to see encouraging trends in terms of that pipeline buildup, right? So I would just say, just bear in mind that, yes, we are expecting that post pandemic and that reacceleration. Yes, but that will not expect what you will be seeing in terms of the revenue growth in subscription as a whole, right? How do we define post pandemic? I guess everybody is thinking when everybody is being vaccinated, and that is no longer out there, but potentially more clear second half next year onwards, as you are saying, right? But I would be expecting that this reacceleration will start next year, and then you will be seeing it more on this revenue growth in that effect a few quarters later on.

Okay. And Chano, maybe one more question about the demand backdrop, but maybe through the lens of one of your immediate rivals, if you don't mind, one where, if I'm not mistaken, Chano, you worked for 6 years before you came aboard Workday. But SAP dropped a bit of a bomb on Wall Street several weeks ago with a fairly material guide down. And the nature from investors would need to interpret SAP's misfortunes as being illustrative of some broader demand trend. It's tough to figure out whether that's the correct interpretation or whether perhaps it's something SAP specific. I wouldn't normally ask the CEO of one of their rivals to comment on them. But just because they're such a big player in your market, I just wanted to ask you, Chano, if you could comment on how we should interpret that and whether there's any read through, let's say, to Workday? What are your views?

Well, we're really trying to focus on our business because that's what we honestly can't control, right? We can't control what's happening as well, right? I think to give you a little bit of view, SAPs making another pivot because they realize that what we have been realizing for quite some time now, which is the cloud, is very important for core foundational HR and FIN system, and we welcome that they're doing that pivot, to be honest, right? In terms of what we see, again, we have been encouraged by the trends during the last couple of quarters, I would say that companies continue to push forward with their initiatives right now. We've been very clear as well, of course, that there are some industries that are more hard hits than some others. And with that some bit harder. And we've been encouraged as well by the pipeline build and the pipeline creation and the activity we are seeing right now and the acceleration for COVID that we are expecting to have. And again, it's early days, but it's more reflecting on the pipeline stage, right? So I think that all in all, it's encouraging. Certainly, we need to be -- remain respectful of the environment and remain cautiously optimistic for what it is to come. But nobody knows right now on where we're going to be and exactly how it takes, right?

Okay. Great. Maybe, Chano, will move from the demand environment to maybe more internally at Workday around the sales effort, which is obviously near and dear to your heart. Are there any significant internal sales changes going on, obviously, post COVID, you've had to fairly dramatically change the way that you sell to upsell customers? But maybe you could describe how the process of your whole sales team globally shifting from high-touch to almost no-touch, how that has gone.

Yes. It's a great question. I mean at the beginning with the March-April time frame, was a lot about fearing out the right messaging. Because every week, the environment was changing so fast and we were testing out, but you have to be very sensitive of customers' environment, both from a professional and from a personnel point of view, right? Then it was about figuring out the right cadences in terms of engagement and how we could optimizing a virtual selling sell cycle, right? And that optimization we include a cause demoing and how we were doing that much more creative and interactive, was including, of course, the marketing campaigns and was including as well the overall engagement from our sales guys. And remember that in our case, we've been starting and we'll be building pipeline with a lot of many logos, in some cases, even Fortune 500 companies that have been added to the pipeline that we'd never made. We never made face to face, right? So obviously, when you think about that context, there is certainly good learnings there that will make a reflex and saying, what should we be taking going forward, right? And if you ask me, I don't think we go back to travel ever, at least in the foreseeable future, as much as we did before. And we'll question even myself when I'm just going to one city to have 1 hour customer meeting. So there would be certainly, when we're engaging remotely on demos or so there will be efficiencies there. I commented before on implementation, which is a very important part, Karl, we were doing 70% of implementation, 70%, 80% to operate remotely. We kind of churned to 100%, and we managed to bring it live very successfully huge questions, right? The ones I mentioned before, I would even ask customers like Shell and some others that we've done successfully. So those have been great lessons that necessarily we need to reflect how those play out going forward in terms of giving operational efficiencies for us and make it even easier from our teams and our customers, right? Certainly, I will tell you, our sales teams are really keen to go back to engage face-to-face with our customers. We are humans and our social beings that like to interact, that get energy from others. And I think that the dice are positive, right? I don't think it's going to be as much as it was before, but it is not going to be like everyone is going to be working from home 100% of the time. We're going to make it work that way.

And Chano, is there any internal directive from you or any of the other leaders at Workday around the timing of a return to office or a return to a more normal pre-COVID sales motion? What's the internal messaging you're giving your salespeople about when they might "return to normal?"

Yes. Right now, we -- well, first of all, it's market per market, right? Because if you go to Australia or Singapore today or New Zealand, we are operating almost business as usual. Obviously, because COVID is almost non-existent in some of those geographies, right? There have been some geographies in Europe, like it was Germany where we opened up with those. There were some areas in the U.S., like the Northeast, where we were in a good, better position, right now we're in a bit of worse position, right? So the short answer is it varies per market. As a general guidance, we are thinking that this is going to be most likely, as we discussed before, more normal potentially almost next year onwards. I don't have a crystal ball. But certainly, the safety and the well-being of our employees is where it will dictate that more than any of these things. Clearly, we've been very clear. We are employee first and taking care of our employees is thing that is more important to us. So when we can do that safely, we will do.

Okay. Got it. Maybe, Chano, in our last few minutes as we think even further out than next year. So 5 years out. One question I have is, what you would like Workday's product suite to look like. So when you think about the product strategic roadmap, do you envision Workday staying roughly within the HCM, financial, within that sandbox, Chano? Or can you envision a future where you step out of those 2 anchor end markets and create a third and really broaden out the suite? What's your vision around product over the next 5 years?

It's a great question. I think we ambition to be still within the same sandbox -- within the -- solving the critical challenges around HCM and financials overall. If you look at the market opportunity and the total addressable market we have within that scope, it is very significant, it is very exciting. We still see a lot of things to do and to build and to play out in terms of roadmap going forward. And that customers are requesting and are expecting worthy to do. That it is quite exciting. So that's what we will be expecting to do mostly. What I would say, we will do that mainly organically. Certainly, we will consider M&A when that makes sense. We always had a high bar there because it has to fit from a technology, from a strategic and from a culture point of view. But I think the one we've done has been quite successful, especially if I'm thinking about the significant ones, Adaptive or Scout [indiscernible] sourcing. And certainly, we'll keep continuously scouting the market and looking for those opportunities that would fit well, right? But this is an exciting area to be. I think we have a great competitive advantage. We have various stickiness. We're providing mission-critical application, and there is a lot of areas that we can still lap in terms of upsell and cross-sell that we're discussing with customers to provide even more opportunity and to keep increasing the worthy addressable market that we can take with.

Okay. Well, Chano, that's a good segue to our first question. And maybe it's informed partly by the Salesforce/Slack deal. But the question from one of the audience members is, could you envision an expansion of Workday's product suite into the space of cloud-based team collaboration, digital meetings, brain storming? Can you see Workday getting into the collaboration space, Chano? I suspect this is informed a little bit by the Salesforce/Slack deal.

Okay. It's a great question. I mean, depending how is that collaboration space defined. If it is define us understood by the Teams or the Slack channels or Google Meets or some of the others, the short answer is done. If it is like we know like any SaaS application today has to be relevant not only in terms of the engagement that you produce with your finance users, but the sense of creating that community and that engagement around those users, I think we've been there for quite a long time, and we certainly need to keep expanding down. When I say quite a long time is it starts by we're having one single application where all our customers are part of. That creates already a great sense of community, potentially more on the back end that ones that are not customers have not seen it, but where our customers are continuously collaborating, right, on potentials, features, on informing our product road map and so on and so forth. And that allows because of who we are and the technology we're bringing to market, right? So with that notion of collaboration and engagement, but within the worthy customer-based boundaries, you could say, yes, with the notion of more in terms of any competitive products of the Slack, of the Teams and going a stand-alone, I would say, no.

Okay. Got it. Chano, why don't we end there? I want to express my thanks for participating in this event. I learned a lot. And so thank you to you, Justin and for helping to make the UBS tech conference even more successful. So thank you for your time, Chano.

Karl, thanks a lot for inviting me, and thank you for waking up so early to make this happen. Okay? Stay safe and healthy. And thank you very much for joining. Thank you, Karl. Have a great day. Bye.

Okay, you, too. Bye-bye.