And so I think what that does is it clearly creates an opportunity to bundle and package more things together in the form of upsells and it advantages companies who have broader offerings. And I just think that, that cycle will continue I’m not going to predict whether it gets a little bit — whether it’s a little bit less or a little bit more focused in the enterprise on the efficiency work this year. I just — I don’t think it’s done, and I think we’ll continue to see smart management teams will think about how to — just the same way we are, how do I operate more efficiently and where is the opportunities for us, those are really, really — those are actually better conversations than I think some of the competitive challenges we face when kind of every vertical software was competing for a budget that was, I think, a lot more elastic than it is today.
As far as your question about the kind of smaller or what we would call the mid-market and the enterprise, I think we see similar dynamics now across those different groups. We are certainly focusing on the higher end of the mid-market and the enterprise. And one of the benefits of having a really robust reseller channel is that which is primarily how we access SMBs is that the area between SMB and the smaller end of the mid-market can get pretty blurry. And so we’re very much focused on enabling our partners to access — to move upmarket from just pure SMBs and into more of the mid-market because that allows us to focus our resources and our time much more on the — what we would call the higher end of the mid-market and the enterprise.
Unidentified Analyst: Okay, got it. Thank you. And then also, I guess, my next question is, you had talked about it in the last earnings call, you also mentioned it in the prepared remarks, but the impact of the churn from the large customer in the fourth quarter I was wondering how that’s going to impact fiscal year ’25, the next few quarters, growth and comps.
Darryl Bond: Yes. So I think we mentioned it was about an $11 million customer and their contract ended at the end of December. So we saw one month of impact to revenue in this Q4. And then as we get into this Q1, we’ll see a full three months of impact. And obviously, it comes out of ARR, it comes out of revenue through the fiscal year.
Unidentified Analyst: Got it. Thanks.
Mike Walrath: I think it will — just to add to that, it’ll — it will impact a lot of metrics that we’ll do our best to share the effect of sort of ex that singular customer churn. So for example, our net — I’m sorry, our gross retention — we’ve mentioned that we — this has been in the high 80s for — since we started giving this metric, and we said we’re going to let you know if it changes. With the effect of that large churn, it would have dipped into the mid-80s when we take that out, we were still sitting in the high 80s there. So it will certainly be a headwind in terms of revenue growth, in terms of revenue, which you can see in Q1 and in terms of things like net retention and the gross ARR retention as we go through the year until we lap that next — at the end of next December. But all of that is baked into our guidance, and we do anticipate that in spite of that, we’ll see reacceleration of ARR growth into the high single digits by the end of the year.
Operator: The next question is from Ryan MacDonald with Needham. Please go ahead.
Ryan MacDonald: All right, thanks for taking my questions. Mike, maybe to start on the sort of strong pull line commentary. Can you just talk about perhaps sort of what products you’re seeing the most demand for whether it’s listing, search, pages reviews. If there’s any new verticals that maybe you’ve been able to sort of unlock with some of the marketing and demand generation. And then as we’re getting through the early stages of the year here, are you seeing better signs or maybe signs of quicker progression through that pipeline that’s given you some of the confidence on, I think, the idea of reaccelerating growth in the back half of the year? Thanks.
Mike Walrath: Yes, sure. I’m happy to get into it. I think there’s a bunch of different things there. So one of the things we mentioned in the letter is Boomerang customers. So we’re seeing — and it’s well — I think it’s well documented that there was a lot of competition around listings and some of the other products for particular listings over the last few years. So we saw — we’re seeing an acceleration of boomerang customers. We’re seeing — I think we said — we called out 20 direct customers last year and 10 of those were in Q4. I think some of that is the way that we’re engaging with former customers and the commitment that we’re making to focus on the things that are important to them as well as what they’re — I think some of the dynamics I’ve described, which is they’re seeing that they can do more with us than they can with some of the smaller, more vertical solutions in an environment where they want it.
They want to be able to do more. I also think it’s partly what I talked about on the demand generation side of things, which is when you really start matching up marketing campaigns and messages and content, and we just had a great virtual customer Summit with, I think, record attendance numbers for virtual events at Yext. All of these things create opportunities that you can actually action faster, because the kind of the prospect is ultimately coming in through a door where they understand what it is. When I juxtapose that against some of the campaigns that we ran last year that were maybe a little bit mismatched with what the customers sort of near-term need is. It’s not that you don’t have the opportunity with that customer. It’s just that more of your time goes into requalifying that customer and reestablishing the customer need.
