Operator: Credit Suisse, Fred Lee has the next question.
Fred Lee: All right. Thank you for taking my question. I was wondering if you could talk a little bit about the macro impact on Phone adoption and maybe give us an update on Zoom Phone adoption overall as you have over the past couple of quarters?
Kelly Steckelberg: Yeah. So we continue to see strength in Zoom Phone. As a reminder, we announced on the last call that we had crossed over the 4 million seat mark. We also added nine customers in Q3 that have purchased over 10,000 seats and that brings us to a total of 64 customers in that category. So I think it shows continued strength, especially in the up market even in these challenging economic times. So we’re excited about the prospects that we continue to see there and as we keep promising you all, we will break it out when it gets 10% of revenue. So you will be able to see that then a little more clearly.
Eric Yuan: Yeah. Fred, to add on to what Kelly said, more and more customers are increasingly looking at our Zoom platform, Zoom One UC platform, usually look at a product, phone or Meetings or webinar or team chat. Now look at a full UC stack, because that will give you a better experience in terms of the total ownership of cost is also much better. That’s why more and more customers are moving towards our full, like, Zoom One platform and I am very excited about the opportunities there.
Fred Lee: Great. Thank you very much.
Eric Yuan: Thank you.
Operator: Now moving on to Michael Turrin with Wells Fargo.
Michael Turrin: Hey. Thanks. Good afternoon. Appreciate you taking the question. On the front-end loaded renewal seasonality, you had a useful tidbit on the deferred revenue growth you are expecting in Q4. Can you just maybe walk through how you gear up for that as a company given it’s a little bit outside the norm on general calendar cycles that we’re used to seeing. What kind of visibility do you have into that cohort currently and is there anything you can do to shift that profile or is it just kind of gradual as this rolls forward and you have gotten just accustomed to it internally thus far? Thank you.
Kelly Steckelberg: Yeah. So, as a reminder, this occurred, right, due to the significant increase of customers we had during Q1 in the early stages of the pandemic. And what has happened is due to the practice that we have internally of making it easy for our customers, we co-term when they add on additional products or expand their seat count, for example, so it’s continued to actually exacerbate, if you will, when we’re upselling customers that front-end loaded phenomenon. So it will start to level out over time as we see customers in Q2 and Q4 being our largest seasonal quarters due to the six-month quotas of our upmarket reps. But as you say, we are used to it now internally, everybody knows this is how it works. We are coming into, I guess, our third renewal period and we have seen strength in each of the last two cycles.
So We are able to accommodate, we know how it works and it’s just something we know that it’s not aligned with most of the rest of the industry, which is why we keep reminding you and trying to give you as much color as possible around that.
Michael Turrin: Appreciate that. Thank you.
Kelly Steckelberg: Yeah.
Operator: And our next question will come from Kash Rangan with Goldman Sachs.
