Varonis Systems, Inc. (NASDAQ:VRNS) Q4 2022 Earnings Call Transcript

Guy Melamed : So the quarter actually behaved very similar in terms of seasonality. We didn’t see any abnormal behavior when we look at kind of the seasonality, where similar to other software enterprise businesses, we do have a large component of the business come in the last couple of weeks of every quarter. So we didn’t see any major trends there. In terms of the turnover, I can tell you that the reception of the SaaS offering, as we’ve mentioned several times on this call has been extremely positive. But some of the lessons that we’ve taken from kind of the move from perpetual to on-prem is some increased turnover, which we baked into our guidance and factor that in. So that’s kind of the way we thought about it. But as of now, everything is kind of going in line with our expectations.

Operator: And our final question comes from the line of Shebly Seyrafi with FBN Securities. Please proceed with your question.

Shebly Seyrafi : Yes. Thank you very much. So I want to delve into the 13-point deceleration in North America growth, from 30% to 17%. How much of that was the SaaS headwind? Can you talk about like the different trends you saw between the large customers and smaller customers? And finally, did you see in January or February, early February, this month, a noticeable pickup in North American business versus the end of last year?

Guy Melamed : Now when we gave guidance last quarter, we said that we expected to see some spillover from the macroeconomic conditions in EMEA to North America with some increased deal scrutiny and longer sales cycles in the region. And that was in line with our expectations. So the results kind of that we saw in Q4 were kind of in line with how we saw it when we guided last quarter. There was about 300 basis points of headwind from the SaaS mix shift that impacted our North America reported revenue in Q4. And in terms of January and February, February has only just started. But I could tell you, we gave guidance. We feel good with the guidance that we have provided, and we’ll update as we kind of progress and we’ll give some color on the SaaS transition during our Investor Day on March 14.

Operator: At this time, there are no further questions. Now I’d like to turn the floor back over to Tim Perz for any closing comments.

Tim Perz: Thanks for joining us today. We look forward to seeing you all at our Investor Day on March 14 in New York.

Operator: This concludes today’s teleconference. You may now disconnect your end at this time. Thank you for your participation. And have a great day.