We’re learning a lot very rapidly. But we’re excited to have this new dimension of compute now on the platform. And I think whether that was accelerated or not, this is a capability we wanted to add and excited to be able to get this done here in the middle of this year. I’m not going to comment on the process that led to the conversations and what led to our announcement of the Paperspace a month ago.
Quinton Gabrielli: Yes. Understand. And then, Matt, maybe for you. As I look at the customer segment, it looked like really the scalers is the segment of the business that saw some deceleration in the ARR growth. And I think you’ve been pretty clear that it’s really not churn. So is it fair to think that the optimizations hit this segment of your business, the heaviest compared to maybe some of the builders or learners?
Matt Steinfort: Yes. That’s very, very accurate. The larger customer, the more opportunity for optimization. And we’ve got big examples, Yancey, gave a few but examples where a customer — a large customer that’s storing a fair bit of data on our platform, might change the policy and say, what we used to store 60 days of data and we’ve kind of — we’ve rethought it and we think we can get away with 15 and we just don’t need as much given the consumption model, they can make that happen. But that typically happens in the larger customer base. That’s why you’ve seen the slowdown in the ARPU growth in the scalers versus some of the others. But it’s not — the scalers have the lowest churn of all of our segments. The customer gets on our platform and the more that they consume and the more products that they use, the lower their churn. So the churn in scalers is incredibly attractive churn level, just that we’re seeing more contraction in that area, as you expect.
Operator: And our final question will come from the line of Tim Horan with Oppenheimer.
Timothy Horan: Yancey, can you talk about how you balance free cash flow generation with growth here? And I think you said high 20% on the free cash flow, maybe some timing there. I mean I only mentioned because it’s basically insatiable demand for GPUs. If you doubled your CapEx spend you could probably double your revenue growth. So — and it seems like now is the opportunity to do that. So, can you just walk us through how you’re thinking about balancing that out?
Yancey Spruill: Well, I think what we’ve reflected today is what we see. I will say this, in the month that we’ve acquired Paper space, the potential growth that we see is significantly higher than we saw a month ago. I’m not going to put a quantitive on it but it’s pretty significant. And we’ve already stepped up capital purchases ahead of what we thought a month ago to get us through this year and to support acceleration of the growth rate which again, triple-digit growth rate, we already see our ability to accelerate that a month in. And we’re getting very focused right now on what’s the 2024 opportunity. I think 1 of the reasons we are sort of reframing expectations around capital allocation is this issue because to your point, if we can grow 500%, we will look to do that.
We’ll just see what the opportunity presents itself and we’re very focused on that. And I know we talked a lot about free cash flow this year in a year where the growth was uncertain. And I think — I hope people didn’t misread that as we were allergic to grow. We’ve always said we want to invest our primary uses of capital or whether it’s internal or externally generated growth and we’re demonstrating that now we’re excited. And I remember when we had the conversation with the Board that we’re going to take margins down from what they could have been to invest more in paper space and there was all hands in the air. So we’re excited about this. And we’ll see where it plays out. Obviously, we’ll have more of an update, a formal update at the next earnings call on what we’re seeing.
But I’ll just say that the pace of this opportunity continues as it has in the first 30 days, we’ll continue to see a lot of money going into paper space because it’s a very exciting and opportunity we have.
Timothy Horan: Congratulations on developing in an AI strategy and expense reductions looks really impressive.
Operator: I’ll now hand the conference back over to Yancey Spruill for closing remarks.
Yancey Spruill: Thank you and thanks, everybody, for joining us today. As usual, we really appreciate your support. And we’re looking forward to talking with you over the coming weeks and months about where we are and where we’re heading. And we hope that you all have a good rest of the day. Thank you so much.
Operator: That will conclude today’s conference call. We thank you all for joining and you may now disconnect.
