And we’ve seen a handful of examples where I think with Slack, I think with Shopify, they’ve had price increases that have gone over well. And we’ve seen a handful of price increases from companies where there’s really been pushback that they’ve received. And I’m really happy that our customers, if anything, I think we were very pleasantly surprised how many of our customers said, over the course of the last 12 years, Cloudflare has added so much additional value that they want to pay us more. And so we’ve seen a substantial number of convert already to the annual billing, which is great because it’s helped us pull forward some cash, which is important. And then the second is that those people who — we had price increases for, and it was about a 25% price increase, that actually — so it went from $20 to $25, so not 25%.
That’s misspeaking. But that was well received and we have not seen elevated churn as a result of that. It went about as smoothly as we could possibly have hoped.
Phil Winslow: Operator, we have time for one last question.
Operator: And our final question today will come from Trevor Walsh, JMP Securities.
Trevor Walsh: Great. Thanks for squeezing me in and taking my question. Matthew, thanks for the color around the SLED business and congrats on hitting the FedRAMP certification. You’ve indicated that you thought 3% was I think low at only 3%. So just curious around that public sector business, kind of what you think the kind of the opportunities and maybe what held you back on that up to now? And if your sales and marketing, your new leaders there have kind of any plans to kind of help expand that part of the business. Thanks.
Matthew Prince: Yes. I think we have had some business around —
Thomas Seifert: We just lost Matthew. I’ll step in until he gets his line back. The Federal business, as you know, is a very local business. So getting all the certifications in place across the globe was one of the big targets. And we have made great progress both in Europe and now finally also here in the U.S. And as the certifications have been coming in and the products and the data centers get certified, we have been building up the teams in parallel, not only here in the U.S., but also outside of the U.S., especially in Europe, and we expect business to grow with it. And I would shy away from giving a concrete target or number for this year. But as you heard from Matthew, we think we have an overwhelming opportunity in front of us and now with the certifications in place and the team that gets hired, we are quite excited about this space.
Trevor Walsh: Great. Thank you.
Thomas Seifert: I wanted to — I think Alex was cut off on his last question. I think you wanted to find out how much of the price increase was baked in, in our guidance. I think it’s fair to assume, and you can draw that conclusion from Matthew’s comments, for this year it’s probably more a tailwind to cash flow than it is a tailwind to revenue. Most of the customers have opted in to convert to annual billing and lock in the historic prices for one more year. So less of a tailwind for revenue, but more a tailwind of free cash flow for this year, at least.
Matthew Prince: And apologies. My cell phone provider doesn’t use Cloudflare it turns out. So my call dropped. That’s a first. But I’m sure Thomas’ answers were exactly right.
Operator: And that does conclude our question-and-answer session. Did you have any closing remarks?
