SecureWorks Corp. (NASDAQ:SCWX) Q4 2023 Earnings Call Transcript

Madeline Brooks: Hi, Wendy and Paul. Good morning. Thanks for taking my questions. Just two here for me. I guess the first is the restructuring and I’m thinking about how we try and reaccelerate growth once the transition is complete? Do you feel comfortable that the staff that you have now, especially from a go to market perspective, will be able to deliver on growth once we do get past some of these economic headwinds? And my second question too is, just a follow-up on the net new customers. Is there any chance that you’re providing, you know, complete net new customers outside of cross-sell? Thank you.

Wendy Thomas: Let me take the first one and then I’ll let you take the second one. So, in terms of the restructuring think about €“ and then I’ll answer the sales kind of headcount. We have essentially two businesses that we are managing through. Obviously, the restructuring is related to the end of life date for our other MSS business outside of Japan, February 3. And so, obviously the staffing and the cost structure related to that, we had a set of restructuring actions related to manage our cost structure down relative to the sunset of many of those lines of business. And we will continue to manage that process as we end this year as Paul said, less than 5% of the ARR on the other MSS revenue line. When you then separate that out, there’s other parts of the business, of course, where we are growing the organization, different set of field sets.

Sales are certainly one of those. One of the key things for us on the sales and marketing side is that we had a number of sales professionals who were focused on re-solutioning. So, not quite a third of our quota-carrying headcount and we transition those at the end of the year again outside of handful in Japan to hunting to new territories where they also can benefit from cross-sell and up-sell opportunities as well, but their primary role is focused on new business from new customers. So, we get sort of a lift, if you will, in terms of from that transition as they ramp their territories, but in total, that’s remaining about the same as it was before the total sales quota-carrying headcount.

Paul Parrish: And then for the split of new logo and cross-sell, we’re thinking about half and half between the new logo’s and cross-sell and that’s how we’re getting our site set for FY 2024.

Madeline Brooks: Great. Thanks so much.

Operator: We currently have no further questions. I would like to hand back to Mr. Toomey for final remarks.

Kevin Toomey: Great. Now that wraps the Q&A and today’s call. A replay of this webcast will be available on our Investor Relations page at secureworks.com along with our Q4 supplemental deck with additional financial tables. Thanks again for joining us today.

Operator: Ladies and gentlemen, this concludes today’s call. You can now disconnect your lines. Thank you.