Ragy Thomas: Thank you.
Operator: Thank you. Next question is coming from Michael Turits from KeyBanc. Your line is now live.
Michael Turits: Hi, Ragy and Manish. Congrats on strong performance all around both top line and bottom line. First question, I think, is around the services change. So maybe whether it’s Manish or Ragy, can you talk a little bit more about exactly where those low-margin services are that you can cut and maybe move to partners? And whether or not €“ and how you can €“ what €“ it seems like where you’re going is towards an even more sophisticated integrated type of an omnichannel offering. How can you do that with less services and some of it suggest that you need more?
Ragy Thomas: Yes, Michael, great question, and thank you for asking it. Now the approach we took in building the platform was to make it extremely powerful and extremely configurable, right? So we spent 10 years doing that. And so, pretty much everything in Sprinklr can be configured. Now that added a lot of complexity in our early years. In last three years, we significantly redid, we created our own UI models and paradigms and frameworks and simplified everything. And we made some pretty significant architectural and technology changes and created persona-based apps that allow each person to come and just see what they need to see. This last big one was verticalizing it, verticalizing the platform configuration. As a result, we’re able to load up configurations that get people a long way there as opposed to doing discoveries and doing it one by one and this is something that we’ve been doing steadily.
So I’d say standardizing on the solutions vertical markets, having our pre-build configuration kits, right, Sprinklr for financial services, Sprinklr for CPG into companies with standardized use cases and productizing more implementation is something that significantly helped us simplify. And it’s been a big part of our make it easier to sell and get value from Sprinklr moved that I think we’ve made the most progress on.
Michael Turits: Yes
Manish Sarin: Yes. And if I could add one other piece to it. So when we talk about lower margin, you’ve heard us talk about we’re building an ecosystem of service delivery partners around our product. And I think our hope here is as we enable the likes of Accenture to do more service delivery, we can rededicate our employee base to a higher-margin business, as I was referring to as managed services. And as we sell more CCaaS, what we are finding is these sophisticated customers are looking for a white glove service that we can provide through our own managed services consultants. So this is more around reconfiguring our own existing service delivery teams and actually enabling the service delivery partners to do a lot of the other implementation work that historically we’ve been focused on.
Michael Turits: Got it. And then in terms of the outlook, so you guided €“ it’s early in the year, good to be conservative, but you guided essentially back to mid-teens growth again and yet you had 20s plus RPO growth. Your net expansion rate granted. It’s a trailing 12 months, so at 1.24 , maybe it goes down further from here. But all €“ and you said that you had record bookings. So what leads the difference between what looks like 20% plus in many categories versus the 15% guide?
Ragy Thomas: Yes. And so thank you as always for parsing through the numbers. If you look at the subscription guide, you would see that is almost $10 million higher than consensus. Part of the reason that might be hidden is because of the services number that is down in our guide year-over-year. So the overall revenue number seems like it’s not moving up very much, but I would subject that as a subscription company, investors are to focus more on our subscription revenue and our beat here in Q4 is translating to a higher subscription number both in Q1 and for the full year FY2024.
Michael Turits: Okay. Thank you very much.
Operator: Thank you. Next question is coming from Matt VanVliet from BTIG. Your line is now live.
Matt VanVliet: Yes. Good afternoon. Thanks for taking the question. I guess looking at the Sprinklr Service offering, talking a lot about modernizing the contact center and recently added voice, but curious in terms of what mix some of those deals are coming in of actually including voice from there or you being brought in first to bring in the digital services create a more omni-channel environment and then go back and either try to win the voice or kind of deal with that later on.
Ragy Thomas: Matt, thank you for the question. It used to be that we were €“ we would be brought in for is messaging, social, digital, and then expanding the voice. But increasingly, the people who are looking at the platform and including us in a competitive RFP process they’re comfortable just starting with Sprinklr for everything. So that’s again remember this is where the new kid on the block with CCaaS and we’re very encouraged about what we see.
Matt VanVliet: Okay, helpful. And then with the shift to more of a productivity model on the sales side, how should we think about headcount growth from court of carrying reps or maybe even the whole go-to-market organization for fiscal 2024, understanding that you just did a little bit of a reduction and you’re looking to try productivity, but how should we think about total headcount growth in that group looking ahead?
Ragy Thomas: Yes. So I think from our perspective, we anticipate to drive a lot of incremental revenue from existing headcount. So at a very high level, you should probably assume sales headcount growth would be lower than overall revenue growth, which would make sense because as we get to our longer-term model, which I know we probably will detail in great detail as we talk about at Analyst Day, you’ll see us show a steady improvement in our spend across the Board. And sales and marketing obviously would be a big piece of it. And as we mentioned last quarter, we’ve committed to efficient growth and the Rule of 40 is something that, that is a goal for us.
Matt VanVliet: Very helpful. Thank you.
Ragy Thomas: Thank you.
Operator: Thank you. Next question is coming from Parker Lane from Stifel. Your line is now live.
