Frank Slootman: Telco is a really important segment for us. I mean, our largest customer — some of our largest customers are in that segment. They’re running massive amounts of data very focused on managing the service experience, cross-selling across very, very large customer bases. This is our fifth industry cloud that we have announced, and it’s really focused on bringing telco-specific data sets, data assets to it, data practices, applications and then really bring in that ecosystem of telcos, people that interact with each other. We have the opportunity to have the benefit of a data network like Snowflake. So we’re very high on — I mean, obviously, telcos are the cornerstone of every modern economy, and especially in a lot of secondary markets, I mean, telcos tend to be the biggest consumers for us.
Operator: Our next question comes from Brent Thill from Jefferies. Your line is open.
Brent Thill: Just as it relates to the overall guide, can you just give us a little more color kind of what you baked in, Mike, and ultimately, perhaps kind of what’s been the big change from your perspective?
Mike Scarpelli: The big change is really the — we’re seeing the younger cohorts that are coming into Snowflake are really ramping at a slower pace than what some of the early adopters of Snowflake did. They’re still consuming. These tend to be large organizations as we’ve been focused on those large G2Ks, and they just move slowly, but they’re still ramping their consumption just at a lower rate. And I think Snowflake is being deployed more efficiently for these customers. And I also just think too, as our base gets bigger that growth naturally slows down in the business, but customers are still consuming.
Brent Thill: And just from a rep productivity perspective, Mike, is there anything changing there where you’re seeing the reps productivity slow? Or is not consistent to what you’ve seen historically?
Mike Scarpelli: I would say we have a rep productivity issue in some of the international markets, and we are slowing down some of our hiring where we don’t see the productivity, but there’s other areas where productivity is doing well. The large enterprises is definitely doing well for us. North American enterprise continues to be strong for us. And we’re going to deploy resources where we think we can get those reps productive over the next 12 months.
Operator: We now turn to Keith Weiss from Morgan Stanley. Your line is open.
Unidentified Analyst: This is Deaton for Keith. You put up 158% net retention this quarter, which is still an impressive number, but slowing sequentially, I would love to understand what you’re seeing between the different customer cores in terms of expansion momentum but also maybe optimization and how that sort of changed over the last 90 days. Any way you could sort of parse that out between 1 million plus customers and then the rest of your customers?
Mike Scarpelli: First of all, the 158% was the exact net revenue retention, just as a reminder, when we went public, and I think there was a little bit of a reacceleration in our business and 2021, 2022, where there’s a lot of customers that maybe had spending out of control. Now that costs are a much bigger focus within almost every company today, I think people are using Snowflake more efficiently. Customers are having very detailed methodical deployment plans on Snowflake, which is slowing down that growth rate of customers’ consumption as they’re going through their implementations. But we’re not seeing any customers decrease their spend in any material way in Snowflake. Yes, we still had those three we pointed out at the beginning of last year that a few of those have dropped out of our top 10, but those guys have stabilized.
But in general, most of our customers continue to grow with us, albeit at a lower pace, and I think that’s more of a nature of controlling costs.
