Sid Sijbrandij: Yes. Thanks for that, Matt. Security is getting more and more important. And not only is secured again and more important, people are recognizing security needs to be an integral part of the DevSecOps life cycle. You need to shift security left. And as a DevOps platform, we are leading in the number of features we offer within that security tier. Static and dynamic analysis, container scanning, secret detection, we have the best security offering, and that is resonating in the market. And this quarter, we also put a focus on Govern because it’s not enough to just have all the security functionality. When the auditors walk into your company and say, “Hey, that environment tell me what runs there, who signed off on that code.
Did another person sign off on the code? Did you run all the tests?” You need answers. You need documented answers that you did that. And the alternative for GitLab is building that yourself and no company wants to do that, especially not in this economy. So, we’re super excited that we not only have the most security technology, we also allow you to prove it that you did all of that.
Sharlene Seemungal: Our next question comes from Michael at KeyBanc.
Michael Turits: I wanted to ask about sort of the macro question in the sense that, obviously, headcount expansions are going to reverse. In some cases, there are other cuts. How is it that you’re doing well to expand with customers within that? Is that because you’re getting greater penetration? Or is it more a function of expansion from an ARPU perspective? And so, we’ll start to see that in more ultimate percentage at some point, which has flattened a bit.
Brian Robbins: Thanks, Michael. Appreciate the question. We talked about this before as because it’s a bottoms-up land when we land a new customer, it’s typically 50 to 100 licenses. In some cases, they have thousands and thousands of engineers and expand over time. And that’s why the cohorts are still expanding. The number one — sorry, on net dollar retention rate, the number one reason why they’re expanding as seat expansion. The second is for tier upgrade to Ultimate. And then the third is increased yield from the customer. When we set our sales compensation, we don’t differentiate from Premium versus Ultimate. We try to remove the friction out of the buy process as well as the sell process. And so when you’re buying Self-Managed and SaaS is priced exactly the same.
From an accounting standpoint, it’s relatively the same revenue recognition and cash upfront. And from a sales standpoint, we want to go in and see how we can drive quick time to value and a business outcome, so they can actually get the ROI in the Forrester report that we had talked about in the prepared remarks, 427% over three years. And so it’s not that we’re fully insulated from it, but — and I did say we are seeing some impacts to the macro, such as just overall people looking at every expenses, higher level of people looking at them. But when you have a mission-critical platform and everybody needs to basically drive quicker time to value, you’re seeing a move to a platform, and those returns are paying off for those companies.
Sharlene Seemungal: Now we’ll move on to Derrick at Cowen.
Derrick Wood: Great. Congrats on a solid quarter. Brian, just could you double click on the macro and talk about kind of what you’re seeing across enterprise versus mid-market versus SMB and maybe kind of U.S. versus international. Just kind of tease out a little bit more around where there’s a little bit more macro pressure. And then I guess just as a follow-up, we’ve heard of instances of when people make expense reductions. This can be a catalyst to replatform to GitLab. I’m sure that’s not a common reason. But are you seeing this as being the case more frequently in this environment?
