David Wadhwani: Yes. I’m happy to jump in and Shantanu can add anything. So at a high level, if you look at what we’ve talked about at Analyst Day, our strategy is very clear, which is new users and retention are the core drivers and focus areas. As Shantanu mentioned, we’re being very focused and very intentional in terms of those two things. When it comes to new subscribers, we added more new commercial subscribers this year than we’ve ever added in our history. And that is a really important intentional sort of activities we are doing. Many of those new users are — tend to be nonprofessionals, right, or they tend to be earlier in career professionals. And so, they are coming in and leveraging our initial single app plan or Adobe Express, as an example, and we’re very happy to have them take that on because we believe very strongly that the opportunities to drive and upsell them from Express to single app and from single app to all apps, is going to be something that is persistent and something that is very ready and available to us at the time we need.
The main thing, though, is about getting them into the products and making them successful. And so with that focus, we’ve been very — we’ve also been maniacally operational about retention of those bases. I think people have asked questions, as you broaden the net, you bring in other users that are not typical Adobe users, what’s happening to the retention rates. I think we also shared that we’re seeing usage of products continues to stay very strong as we bring in these new audiences. And we’re starting — and we’re seeing retention continue to tick up and improve. And in fact, retention now is better than it was pre-pandemic as an example. So, we continue to bring in new users. We continue to retain those new users and we see organic opportunities to move them up and upgrade them.
Shantanu mentioned a great example of education. We continue to see a lot of people come in with our education pricing. And then, we have the opportunity, two years or three years later when they graduate to upgrade them to full commercial pricing. And those activities are playing out as expected, and we see a lot more opportunity to it. But it all comes down to bringing new users in, getting them using the products a lot and retaining them.
Shantanu Narayen: And maybe to add to that, Keith. I mean, when you think about the newer businesses that we’re talking about, video just continues to be a really key growth driver, 3D and immersive imaging and photography. But if you take a step back, I think that two things happening in the macroeconomic environment that are actually going to be tailwinds. The first is the fact that it is the golden age of design. Everybody would like to express themselves. There are more screens on which all of this content is being consumed. So, I think the insatiable consumer demand for content, I think, is certainly driving a lot of more content that’s being created. One of the exciting areas that I think David and Anil have talked about is what we are calling content supply chain.
And when you take even the larger companies, they are all trying to get a handle of as they engage digitally with customers how much content is being created? Where is it being created? Where is it being delivered? How do I localize it? What’s the efficacy of that content? And so, I think this content supply chain and everything we have with our creative applications, our asset management, the fact that we then deliver that content, I think we continue to believe that that’s going to be a growth driver for the entire business as well. So, I wouldn’t underestimate the insatiable consumer demand but I also wouldn’t underestimate what’s happening as enterprises recognize that the way to engage with people is to personalize that content.
Jonathan Vaas: Hey operator, we’re at the top of the hour. We’ll make time for one more question, and then we’ll wrap up. Thanks.
Operator: You bet. We’ll go ahead and take our last question from Alex Zukin with Wolf Research. Please go ahead.
Alex Zukin: I apologize for any background noise. I guess we’ve heard a lot about the continuing growth initiatives in the demand environment, sounding like it’s pretty resistant to any macro pressures I believe you’re seeing at the moment. I’ll ask the kind of other side of the equation. As you think about the levers that you have on the margin side, the discipline that you’ve been exhibiting. It does seem like over the last quarter and maybe the past few quarters, that margin story, that margin discipline has continued to exceed at least our expectations. So, as we look at the next year, as you think about the levers that you have in the business if the parts of the business should slow. Can you go through maybe walk through a little bit of where you see the opportunity to either, A, lean in or B, pull back? And also, how we should think about cash conversion in that scenario from a cash flow perspective. Thanks again.
Dan Durn: Yes. So from an operating performance standpoint, you rightfully point out, the Company is performing really, really well. But we’re doing what we’ve always done inside the company, which is drive growth, deliver industry-leading products and innovation to our customers, help them become more effective on the critical path of driving revenue for their business. But we do it in a very disciplined way that drives margin and cash flow while driving growth. And we talked a lot about Rule of 40 at our FA day. If I were to take a step back and reflect on FY22, it’s complicated macro environment, and we’re operating at a rule of 60 for the year. So, we feel really good about our ability to operate. And so as I look forward into next year, we’re going to continue to lead.
We’re going to continue to innovate. We’re going to continue to make our customers successful, but we’ll continue to do what we’ve always done, which is ruthlessly prioritized where we make our investments, constantly review the portfolio, prioritize the things that are going to drive long-term value for our customers and do it in a very disciplined way. So, that’s the operating tone inside the company. Nothing’s changed on that front. We feel really good about how we’re executing in the environment and the momentum we’re carrying into 2023. From a cash flow standpoint, it all starts with driving that discipline in the business and we’ll continue to drive cash flow and deploy that excess cash on a quarterly basis to create value with the shareholders.
Shantanu Narayen: And Alex, given that was the last question, let me start off by saying as we celebrate our 40th anniversary, it’s both humbling and inspiring to think about the impact that Adobe has had on the communication world and what we’ve been able to do. And it’s rare to be able to say at this level that we believe that our best years are ahead of us. If I take a step back and I look at what we had done in 2022, there are three things that stand out for me, the Digital Media ARR and just continuing to drive new customer acquisition and deliver innovative products across both, the Creative Cloud and Document Cloud. We’ve done a really good job of demonstrating why creativity and design is going to be more important and also combining creativity with productivity.
