Jacob Shulman: Yes. Thanks for this question, John. JFrog Artifactory, and JFrog platform overall is based on an open red API, working with all the major CICD tools in the market. We are actively supporting GitHub Action, Jenkins, GitHub CI-CD, Circle CI, and obviously others. It’s also mandatory for everyone who use CI to use the binary repository because the moment CI on top of your source code repository, you create a binary. And then the deployment into Artifactory and putting out from Artifactory by CICD and automating the full software supply chain is being made in and out from Artifactory. Regarding JFrog pipeline, JFrog Pipeline is accelerating the automation of the JFrog platform integrates with all the CI/CD tools and help you promote binaries from every quality gate all the way to production.
JFrog pipelines also provide a friendly UI for users to manage their dependencies and to manage the source of all binary. We don’t see JFrog Pipeline as a catalyst for the adoption of our platform or major catalysts for ARR. Actually, what we see is that using JFrog pipeline makes our users more faster and secured as they secure their pipeline by using it.
Jonathan Ruykhaver: Okay. So it’s having a strong impact in terms of the value proposition, but it’s not necessarily impacting ARR or the adoption of the Enterprise Plus package, correct?
Jacob Shulman: Correct.
Operator: Okay. Thank you. Looks like our next call is from Michael Cikos from Needham & Company
Michael Cikos: Great. And I apologize if I missed this in the prepared remarks for the Q&A. I know I’m struggling in a couple different earnings calls, like I imagine my peers are as well. But I think the first question, if I could, for Shlomi. We were kind of struck last quarter when the Company was saying that the optimization headwinds were largely behind the Company. And I apologize if I missed this, but could you provide us an update? Does that still stand here where we are today? Is it fair to think that those optimization headwinds for JFrog are now firmly in the rearview mirror? And then I just had one follow-up.
Shlomi Haim: Yes, Mike, we did talk about the usage trends, and we continue to see continued growth of usage. So we do believe that this wave of optimization is behind us. We continue to see the adoption of our platform by larger customers on marketplaces. However, having said that, we also see a slower pace of migrations comparing to prior year. So definitely, macro headwinds in terms of impact on pace of migration is still there, but cloud usage continues to grow, and that trend that we’ve been experiencing for a couple of quarters now.
Michael Cikos: Got it. Got it. Okay. And I think maybe one other item. I think earlier this year as well, I know the Company was trying to adjust its free tier. And I think that you guys had decided to limit the number of users that fell under that free tier and maybe by creating that limited capacity, there was a thought that, that could benefit the model and some capacity from a monetization standpoint. Can you remind us what the initial findings on conversion or benefit to revenue, if any, have come through the model at this point?
Jacob Shulman: Yes, Mike, when we decided to kind of building the top of the funnel without free tier earlier in 2022. The main reason was all the additions that we provided with security and IoT capabilities. If you cannot just add on a 3-tier basic DevOp solution, it didn’t serve not the strategic product strategy and not the go-to-market strategy, which became top-down strategic enterprise sales. The conversion that we’ve seen from the free tier where customers, usually small groups of developers that converted to Artifactory and the power subscription, and we decided that it doesn’t serve the top of the funnel, I’m happy to report that you can see that what we have built now with our enterprise sales and the strategic sales per foot, one of the results being demonstrated this quarter with the amount of customers that are going over $100,000 over $1 million. This is not coming from pretty as you probably understand.
