Ash Kulkarni: Yes. Hey Vinod, maybe I can touch upon this. So, we don’t break out discretely the growth percentage in terms of how APM is being adopted. We gave this data point primarily because as we have been driving customer adoption, not just across solutions, but within a solution, so Observability going from log analytics to APM metrics and so on, there is a growing need that we are seeing in growing interest and consolidation. And so this data point was one that we are sort of giving for the first time because it’s now pretty clear that our APM solution is one that is gaining a lot of traction, has gained a lot of traction. Matter of fact, one of the customer examples that I gave in my prepared remarks, the large eight-figure deal that we signed with a large financial services institution was really all about APM.
So, it’s being used at scale. It’s being used in very significant ways. And the way we tend to drive that expansion motion is in a couple of ways, right. So, one is the pricing model tends to be incredibly relevant in that scenario because our pricing model is completely based on consumption. So, it’s not like the customer has to start with going all in on Elastic on any of those newer use cases, we typically tend to suggest that they play with it. They tried for instrumenting a few applications at a time getting familiarity with the capabilities and then deciding if it’s something that they want to roll out across their entire real estate. And that’s how we have been growing in a very viral manner, the expansion scenarios. And it’s gotten to the point now where a significant percentage, like I mentioned, of our Observability customers using APM in some way, shape or form.
And we just expect that to continue growing. The other thing that we are doing is also making sure that, that’s the play that our sales teams are driving with all our enterprise and commercial customers. It’s that that land-and-expand motion that we really focus on. Once the customer lands and they typically tend to land on cloud, like we have talked about in the past, the real focus for the sales teams ends up becoming all around expansion. And that expansion is centered around starting from logs in Observability to APM to metrics. If the customer starts with security, specifically with SIEM then going from SIEM to XDR. I also gave some stats about the adoption that we have seen around XDR and some of our security use cases. So, we are starting to see that flywheel work quite nicely.
And that’s really going to be the focus going forward as well.
Vinod Srinivasaraghavan: Thanks. Appreciate that. And just one more for me. I think last quarter you mentioned that you weren’t seeing too much impact from macro on €“ from on-prem to cloud migrations, are you seeing an impact to there now, or is the slowdown mainly attributed to lower expansion like you said from SMB on the cloud?
Janesh Moorjani: Maybe I will take that one. So, on the self-managed side, we are actually quite pleased with the performance there. It grew 20% year-over-year in constant currency, which compares favorably to the prior quarter. So, we were pleased with what we saw there. In terms of the overall business perspective, there is nothing in particular I would call out other than customers just continuing to express a preference for cloud. So, we generally view that as a positive for the business. And in fact, as you know, encourage that preference as well. We do think that self-managed will continue to grow. And that growth over the long-term should just mimic where workloads reside. So, it’s not a substitution effect. We are not trying to do any kind of forced march.
It’s just that cloud workloads are growing faster than on-prem workloads. The way we think about it from a longer term perspective is that our opportunity set is large and our penetration rates are low. So, we should have plenty of room to grow in both the cloud and the self-managed formats.
Vinod Srinivasaraghavan: Understood. Thank you.
Operator: The next question will come from Matt Hedberg with RBC Capital Markets. Please go ahead.
Matt Swanson: Yes. Thanks. This is Matt Swanson on for Matt. Kind of a follow-up to the last question around consolidation. I mean obviously, this is a positive, but I would assume this is also making deals, maybe a little larger, but also more complicated. You mentioned the increased scrutiny that we are seeing in this macro. Could you just talk a little bit about how this consolidation theme might be impacting sales cycles? And then I mean you went into it a bit, but just kind of things you are doing to streamline this from a go-to-market perspective?
